/raid1/www/Hosts/bankrupt/TCR_Public/130521.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, May 21, 2013, Vol. 17, No. 139
Headlines
4LICENSING CORP: Incurs $1 Million Net Loss in First Quarter
A & E TWO ASSOCIATES: Voluntary Chapter 11 Case Summary
AAA COFFEE: Case Summary & 15 Largest Unsecured Creditors
ACCENTIA BIOPHARMACEUTICALS: Delays 10-Q for Limited Funds, Staff
ADVANCED LIVING: Hiring of Horhmann Taube & RBC Capital Approved
ADVANCED LIVING: May Employ SWBC as Tax Advisor
ADVANCED LIVING: Taps Agnew & Foster as Special Litigation Counsel
ADVANCED LIVING: Taps LTC Consulting for Billing and Collection
AGSTAR FINANCIAL: S&P Rates Proposed Preferred Stock Offering 'BB'
AGY HOLDING: Moody's Changes PDR to 'Ca-PD' & Keeps CFR at 'Caa2'
AGY HOLDING: S&P Lowers Corporate Credit Rating to 'D'
AJ & M: Case Summary & 16 Unsecured Creditors
ALLY FINANCIAL: S&P Puts 'B+' Credit Rating on Watch Positive
AMERICAN AIRLINES: Seeks Formal OK of Plan-Support Agreement
AMF BOWLING: Files New Chapter 11 Plan & Disclosure Statement
AMKOR TECHNOLOGY: S&P Rates $200MM Sr. Unsecured Notes 'BB'
ARCAPITA BANK: Test Case on Subordination of Stock-Fraud Claims
ARTEL LLC: Slow Orders Cue Moody's to Change Outlook to Negative
ARZBERG-PORZELLAN: German Tableware Maker Files Chapter 15
ATLANTIC & PACIFIC: Claims v. Yucaipa in Securities Suit Junked
ATLANTIC COAST: Incurs $2 Million Net Loss in First Quarter
ATLANTIC COAST: Two Opposing Directors Demand CEO's Resignation
ATLANTIC COAST: Amin Ali Held 9.5% Equity Stake at March 11
ATLANTIC POWER: S&P Puts 'BB-' CCR on CreditWatch Negative
BBX CAPITAL: Incurs $6.5 Million Net Loss in First Quarter
BEAZER HOMES: S&P Revises Outlook to Stable & Affirms 'B-' CCR
BEBO.COM INC.: Case Summary & 19 Largest Unsecured Creditors
BERNARD L. MADOFF: Starts Appeal to Revive $10-Bil. in Suits
BRONX PARKING: Yankee Stadium Parking Lot in Forbearance
BROOKLYN NAVY: S&P Retains 'CCC' Rating on Senior Debt
CAPITOL BANCORP: Files Liquidating Plan, to Sell Remaining Banks
CAPITOL BANCORP: Incurs $2.5 Million Net Loss in First Quarter
CHEM RX: McKesson Wins Summary Judgment in Avoidance Suit
CHESAPEAKE ENERGY: Fitch Affirms 'BB+' Issuer Default Rating
CHINA NATURAL: Reports $4.6 Million Net Income in First Quarter
CLEAN BURN FUELS: Ch.7 Trustee May Avoid Perdue Unperfected Lien
CLEAR CHANNEL: Moody's Keeps 'Caa2' CFR Over Upsized Loan
CLEAR CHANNEL: S&P Keeps 'CCC+' Secured Debt Rating on Loan Upsize
CRESTWOOD HOLDINGS: Moody's Rates New $365MM Term Loan 'Caa1'
CS PROPERTY: Case Summary & 2 Unsecured Creditors
CUMULUS MEDIA: Stockholders Elect Seven Directors
D & M ROLNICK: Case Summary & 2 Unsecured Creditors
DCP MIDSTREAM: S&P Rates New Jr. Sub. Unsecured Notes Due 2043 BB+
DDR CORP: S&P Retains 'BB+' Corporate Credit Rating
DELTA OIL: Incurs $155K Net Loss in First Quarter
DEX MEDIA: S&P Assigns 'B-' CCR & Rates 4 New Secured Loans 'CCC+'
DOLE FOOD: S&P Retains B CCR After Upsized Credit Facilities
DOUGLAS DYNAMICS: Moody's Affirms 'B1' Corp. Family Rating
DOWNSTREAM DEVELOPMENT: S&P Revises Ratings Outlook to Negative
DYNAVOX INC: Posts $6.6MM Net Loss in 3Q FY 2013; In Debt Default
DRYSHIPS INC: To Release First Quarter 2013 Results on May 22
EASTMAN KODAK: Files Details of Consumer Sale, U.K. Settlement
ECAST CORP: Cerner Multum to Have $12,855 Ch.11 Admin. Claim
EDISON MISSION: Exclusive Plan Filing Extended Until Nov. 7
EDISON MISSION: Has Court OK to Hire Novack as Litigation Counsel
EDISON MISSION: 3 Units File Schedules of Assets and Liabilities
ENERGY FUTURE: Lower-Ranking Lenders May Recover Nothing
ENJOI TRANSPORTATION: Case Summary & Creditors List
FERRELLGAS PARTNERS: S&P Raises Senior Unsecured Rating to 'B'
FIRE CONTROL: Voluntary Chapter 11 Case Summary
FIRST DATA: S&P Rates Subordinate Notes Due 2021 'CCC+'
FIRST FINANCIAL: Presented at 2013 Annual Shareholders Meeting
FIRST INDUSTRIAL: S&P Raises CCR to BB & Rates Preferred Stock B
FIRST MARINER: Incurs $2.3 Million Net Loss in First Quarter
FIRST NATIONAL: Reports $1.7 Million Net Income in First Quarter
FIRST SECURITY: Incurs $7.9 Million Net Loss in First Quarter
FONTENOT'S PRECISION: Case Summary & Creditors List
FOX VALLEY: Case Summary & 20 Largest Unsecured Creditors
FREESCALE SEMICONDUCTOR: S&P Assigns 'B' Rating to 1st Lien Notes
FULLCIRCLE REGISTRY: Incurs $27,900 Net Loss in First Quarter
GAME TRADING: Settles Baltimore County's Claim
GROWLIFE INC: Incurs $1.18-Mil. Net Loss in 1st Quarter
HANDY HARDWARE: Littlejohn Working on Plan to Acquire Business
HARLAND CLARKE: S&P Keeps 'B+' Notes Rating on $50MM Add-On
HELLER EHRMAN: No Appeal Yet on Montali's 'Jewel' Opinion
HOTEL OUTSOURCE: Incurs $412,000 Net Loss in 1st Quarter
ISRA HOMES: Case Summary & 16 Unsecured Creditors
INVESTORS GROUP: Voluntary Chapter 11 Case Summary
J.C. PENNEY: Tender Offer Expiration Extended to June 4
JEFFERIES LOANCORE: S&P Assigns 'B+' Issuer Credit Rating
JEVIC TRANSPORTATION: Court Trims Claims in WARN Act Class Suit
KIT DIGITAL: Shareholders Have Alternative to Prepack
KRONOS WORLDWIDE: Moody's Affirms 'Ba2' Corp. Family Rating
LMK PROPERTIES: Case Summary & 3 Unsecured Creditors
LODGE PARTNERS: Case Summary & 20 Largest Unsecured Creditors
MACKINAW POWER: Fitch Affirms 'BB-' Rating on $147MM Secured Loan
MAGNA CHIROPRACTIC: Case Summary & 15 Largest Unsecured Creditors
MAMS LLC: Case Summary & Unsecured Creditor
MEDIACOM BROADBAND: S&P Assigns 'BB-' Rating to $450MM Term Loan
METEX MFG: Seeks to Participate in The Home Liquidation Proceeding
MF GLOBAL: Wins Court Approval of NY-717 Fifth Settlement
MIDTOWN SCOUTS: Case Summary & 20 Largest Unsecured Creditors
MILAGRO OIL: Commences Private Exchange Offer for 10.500% Notes
MILL US: S&P Assigns 'B' CCR & Rates $650MM 1st-Lien Loan 'B+'
MINT LEASING: Delays Form 10-Q for First Quarter
MONARCH COMMUNITY: Had $328,000 Net Loss in First Quarter
MTS LAND: Martori & Company Approved as Real Estate Appraiser
MURRAY ENERGY: S&P Lowers Issue Rating to 'B-' & Affirms 'B' CCR
NANTAHALA CABINS: Case Summary & 3 Unsecured Creditors
NAVISTAR INTERNATIONAL: To Present at Wolfe Trahan Conference
NATIONAL PROPERTY ANALYSTS: Incurs $2.1-Mil. Net Loss in 1st Qtr.
NCI BUILDING: S&P Raises CCR to 'B+' & Rates $240MM Loan 'BB-'
NECH LLC: Plan Disclosures Denied, Chapter 11 Case Dismissed
NEWSTAR FINANCIAL: S&P Assigns 'BB-' ICR & Rates $200MM Loan 'BB-'
NEXT MART: Case Summary & 4 Unsecured Creditors
NII HOLDINGS: S&P Assigns 'B-' Rating to $500MM Sr. Unsec. Notes
NORTH COUNTRY: Case Summary & 20 Largest Unsecured Creditors
OLD SECOND: Reports $4.2 Million Net Income in First Quarter
ORECK CORP: Oreck Family to Buy Back Vacuum Biz. for $21.9-Mil.
PATRIOT COAL: Deregisters 2.2 Million Common Shares
PATRIOT COAL: Judge Approves Bonuses for Hundreds of Workers
PITTSBURGH CORNING: Gets Conditional Approval of Chapter 11 Plan
PORTER BANCORP: Files Form 10-Q, Had $524,000 Net Loss in Q1
PRE-PAID LEGAL: S&P Rates Proposed $405MM Secured Refinancing 'B'
PROGUARD ACQUISITION: Incurs $125K Net Loss in 1st Quarter
RED OAK: S&P Lowers Rating on $384MM Sr. Secured Bonds to 'B+'
RENTAL SYSTEMS: Case Summary & 16 Unsecured Creditors
RESIDENTIAL CAPITAL: Plan Filing Deadline Extended to June 6
RESIDENTIAL CAPITAL: Seeks to Cap Sr. Exec. Bonuses at $272K
RESIDENTIAL CAPITAL: May 23 Pretrial Conference on RMBS Deal
RESIDENTIAL CAPITAL: Sues Junior Noteholders Over Liens
REVSTONE INDUSTRIES: Has Secret Deal to Settle Trustee Motion
REVSTONE INDUSTRIES: Greenwood May Access Cash Thru May 31
REYNOLDS OIL: Voluntary Chapter 11 Case Summary
RG STEEL: Settles Environmental Claims for $20 Million
RICEBRAN TECHNOLOGIES: Incurs $6.3-Mil. Net Loss in 1st Quarter
RIVIERA HOLDINGS: Incurs $7.5 Million Net Loss in First Quarter
ROCKWELL MEDICAL: Plans Public Offering of Common Stock
ROTECH HEALTHCARE: Copy of Credit Agreement with Silverpoint
ROTHSTEIN ROSENFELDT: New Plan May Head Off Replacing Trustee
S & R GRANDVIEW: Case Summary & 20 Largest Unsecured Creditors
SCHOOL SPECIALTY: Files Loan Documents to Accompany Plan
SCIENTIFIC GAMES: S&P Assigns 'BB-' Rating to $2.6BB Facility
SCOTTS MIRACLE-GRO: S&P Affirms 'BB+' CCR & Revises Outlook
SEAGATE TECHNOLOGY: S&P Rates Sr. Unsecured Notes 'BB+'
SM ENERGY: S&P Assigns 'BB' Rating to $400MM Sr. Unsecured Notes
SM ENERGY: S&P Lowers Sr. Unsecured Notes Rating to 'BB-'
SPECTRASCIENCE INC: Delays Q1 Form 10-Q, Expects $2.6MM Loss
SPOKANE COUNTRY: Case Summary & 20 Largest Unsecured Creditors
SPRINGS INDUSTRIES: S&P Assigns 'B' CCR; Outlook Stable
STELZER-JAMES L.P.: Case Summary & 10 Unsecured Creditors
STONERIVER GROUP: S&P Assigns 'B' CCR & Rates $570MM Facility 'B+'
SUNSTATE EQUIPMENT: S&P Raises Rating on $170MM Sr. Notes to 'BB'
SUPERVALU INC: S&P Rates $400MM Sr. Unsecured Notes 'B-'
TENET HEALTHCARE: S&P Rates $1.05BB Senior Secured Notes 'B+'
TENNECO INC: Moody's Revises Outlook on 'Ba3' CFR to Positive
TLO LLC: Case Summary & 20 Largest Unsecured Creditors
TOUSA INC: Files Creditors-Backed Liquidating Plan
TRANZYME INC: Incurs $3.4-Mil. Net Loss in 1st Quarter
UNIVISION COMMUNICATIONS: Fitch Rates Term Loan & Sec. Notes 'B+'
UNIVISION COMMUNICATIONS: S&P Rates New Debt 'B+'; Outlook Stable
UNIVITA HEALTH: S&P Cuts CCR to 'B-' & Alters Outlook to Negative
UROLOGIX INC: Incurs $1-Mil. Net Loss in Fiscal 3rd Quarter
VERIS GOLD: Incurs $6.5-Mil. Net Loss in First Quarter
WALLDESIGN INC: CRO May Abandon Title to Aircraft
WESTWOOD PLAZA: Case Summary & 8 Unsecured Creditors
WYNN RESORTS: S&P Retains 'BB+' Corporate Credit Rating
* Bankrupts in Chapter 13 Have Standing to Sue, 4th Cir. Says
* Challenges Remain in Homeownership & Housing Markets
* Large Companies With Insolvent Balance Sheet
*********
4LICENSING CORP: Incurs $1 Million Net Loss in First Quarter
------------------------------------------------------------
4Licensing Corporation filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $1 million on $257,000 of total net revenues for the three
months ended March 31, 2013, as compared with net income of $4.02
million on $1.26 million of total net revenues for the same period
during the prior year.
The Company's balance sheet at March 31, 2013, showed $7.85
million in total assets, $5.09 million in total liabilities and
$2.76 million in total equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/UjwTlY
About 4Licensing Corporation
4Licensing Corporation is a licensing company specializing in the
youth oriented market. Through its subsidiaries, 4LC licenses
merchandising rights to popular children's television series,
properties and product concepts, builds up brands through
licensing, develops ideas and concepts for licensing and plans to
forge new license relationships in the sports licensing industry
and develop private label goods that will be sold to retail or
directly to consumers.
4Kids filed for bankruptcy protection under Chapter 11 of the
Bankruptcy Code to protect its most valuable asset -- its rights
under an exclusive license relating to the popular Yu-Gi-Oh!
series of animated television programs -- from efforts by the
licensor, a consortium of Japanese companies, to terminate
the license and force 4Kids out of business.
4Kids and affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y.
Lead Case No. 11-11607) on April 6, 2011. Kaye Scholer LLP is the
Debtors' restructuring counsel. Epiq Bankruptcy Solutions, LLC,
is the Debtors' claims and notice agent. BDO Capital Advisors,
LLC, is the financial advisor and investment banker. EisnerAmper
LLP fka Eisner LLP serves as auditor and tax advisor. 4Kids
Entertainment disclosed $78,397,971 in assets and $86,515,395 in
liabilities as of the Chapter 11 filing.
Hahn & Hessen LLP serves as counsel to the Official Committee of
Unsecured Creditors. Epiq Bankruptcy Solutions LLC serves as its
information agent for the Committee.
The Consortium consists of TV Tokyo Corporation, which owns and
operates a television station in Japan; ASATSU-DK Inc., a Japanese
advertising company; and Nihon Ad Systems, ADK's wholly owned
subsidiary. The Consortium is represented by Kyle C. Bisceglie,
Esq., Michael S. Fox, Esq., Ellen V. Holloman, Esq., and Mason
Barney, Esq., at Olshan Grundman Frome Rosenzweig & Wolosky LLP,
in New York.
In January 2012, the bankruptcy judge ruled in favor of 4Kids,
deciding that the Yu-Gi-Oh! property license agreement between the
Debtor and the licensor was not effectively terminated prior to
the bankruptcy filing. Following the ruling, 4Kids entered into a
settlement where it would receive $8 million to end the dispute
over its valuable Yu-Gi-Oh! Property.
As reported by the TCR on Dec. 17, 2012, U.S. Bankruptcy
Judge Shelley C. Chapman confirmed the Debtor's Chapter 11 plan.
4Licensing Corporation disclosed net income of $9.54 million on
$3.32 million of total net revenues for the year ended Dec. 31,
2012, as compared with a net loss of $17.08 million on $8.07
million of total net revenues in 2011.
EisnerAmper LLP, in New York, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012. "[T]he Company emerged from Chapter 11
bankruptcy proceedings on December 21, 2012. However, the Company
has suffered recurring losses from operations, and the continuing
costs in connection with its bankruptcy cases, and potential
settlement of the remaining material unresolved claims may have
adverse impact on the Company's liquidity. The above conditions
raise substantial doubt about the Company's ability to continue as
a going concern.
A & E TWO ASSOCIATES: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: A & E Two Associates, LLC
17038 West Dixie Highway, Suite 236
North Miami Beach, FL 33160
Bankruptcy Case No.: 13-21069
Chapter 11 Petition Date: May 13, 2013
Court: U.S. Bankruptcy Court
Southern District of Florida (Miami)
Judge: Robert A Mark
Debtor's Counsel: Joel M. Aresty, Esq.
JOEL M. ARESTY, P.A.
13499 Biscayne Boulevard, #T-3
No. Miami, FL 33181
Tel: (305) 899-9876
Fax: (305) 723-7893
E-mail: aresty@mac.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Eliahu Abukasis, managing member.
AAA COFFEE: Case Summary & 15 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: AAA Coffee Break Service Inc.
P.O. Box 9505
San Juan, PR 00908
Bankruptcy Case No.: 13-03866
Chapter 11 Petition Date: May 10, 2013
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Judge: Enrique S. Lamoutte Inclan
Debtor's Counsel: Carmen D Conde Torres, Esq.
C. CONDE & ASSOCIATES
254 San Jose Street, 5th Floor
San Juan, PR 00901-1523
Tel: (787) 729-2900
Fax: (787) 729-2203
E-mail: notices@condelaw.com
Scheduled Assets: $2,254,784
Scheduled Liabilities: $5,897,328
A copy of the Company's list of its 15 largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/prb13-3866.pdf
The petition was signed by Luis Alonso, president.
ACCENTIA BIOPHARMACEUTICALS: Delays 10-Q for Limited Funds, Staff
-----------------------------------------------------------------
Due to Accentia Biopharmaceuticals, Inc.'s decrease in operating
funds and along with its decrease in personnel, it has caused the
Company to be unable to complete and timely file its quarterly
report on Form 10-Q for period ended March 31, 2013, due on
May 15, 2013.
About Accentia Biopharmaceuticals
Headquartered in Tampa, Florida, Accentia Biopharmaceuticals, Inc.
(PINK: "ABPI") -- http://www.Accentia.net/-- is a biotechnology
company that is developing Revimmune as a system of care for the
treatment of autoimmune diseases. Through subsidiary, Biovest
International, Inc., it is developing BiovaxID as a therapeutic
cancer vaccine for treatment of follicular non-Hodgkin's lymphoma
(FL) and mantle cell lymphoma (MCL). Through subsidiary,
Analytica International, Inc., it conducts a health economics
research and consulting business, which it market to the
pharmaceutical and biotechnology industries, using its operating
cash flow to support its corporate administration and product
development activities.
Accentia BioPharmaceuticals and nine affiliates filed for
Chapter 11 protection (Bankr. M.D. Fla. Lead Case No. 08-17795) on
Nov. 10, 2008. Accentia emerged from bankruptcy on Nov. 17, 2012,
after receiving confirmation of a reorganization plan on Nov. 2,
2010.
The Company incurred a net loss of $9.18 million for the year
ended Sept. 30, 2012, compared with a net loss of $15.65 million
during the prior year.
The Company's balance sheet at Dec. 31, 2012, showed $2.81 million
in total assets, $89.21 million in total liabilities, and a
$86.39 million total stockholders' deficit.
ADVANCED LIVING: Hiring of Horhmann Taube & RBC Capital Approved
----------------------------------------------------------------
The Hon. H. Christopher Mott of the U.S. Bankruptcy Court for
the Western District of Texas has authorized Advanced Living
Technologies, Inc., to employ Horhmann, Taube & Summers, L.L.P.,
as counsel.
As reported by the Troubled Company Reporter on March 1, 2013,
Horhmann Taube will be employed under a general retainer agreement
nunc pro tunc to the Petition Date. The firm's hourly rates range
from $225 to $550 per hour for attorneys and $80 to $165 per hour
for paralegals. The firm has received a $135,000 retainer, which
includes the filing fee. To the best of the Debtor's knowledge,
the firm represents no interest adverse to nor connected with the
Debtor or the estate on matters upon which it is to be engaged.
The Court also has authorized the Debtor to employ RBC Capital
Markets as broker and marketing agent during the course of the
bankruptcy case.
As reported by the TCR on Feb. 28, 2013, the Debtor hired RBC, and
specifically managing director David B. Fields, to market the
Debtor's facilities and guide the Debtor through the marketing and
sale process. RBC prepared marketing materials and a virtual data
room and has worked with four prospective parties to execute a
non-disclosure and confidentiality agreements. Two parties
emerged as potential stalking horse bidders, and RBC negotiated
with both parties.
Subject to the Court's approval, RBC would be compensated as
follows: (i) a base fee of $50,000; (ii) a success fee of 3% of
gross sale proceeds; and (iii) reimbursement of actual and
necessary expenses incurred. RBC will be paid a minimum fee of
$250,000 upon the consummation of a transaction. RBC will apply
to the Court for payment of compensation and reimbursement of
expenses. The firm's allowed fees and expenses will be payable
upon the closing of the sale of the Facilities.
RBC does not have an outstanding balance due from the Debtor for
billed unpaid prepetition work for which it would have a claim
against the estate.
To the best of the Debtor's knowledge, information and belief, RBC
represents no other entity in connection with the Debtor's case,
is a "disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.
As reported by the TCR on May 16, the Debtor won permission to
sell its six not-for-profit Texas nursing homes for $18 million
to Southern TX SNF Realty LLC. The Court approved the sale on
May 10.
About Advanced Living Technologies
Advanced Living Technologies, Inc., owner of six skilled nursing
facilities throughout Texas, filed a Chapter 11 petition (Bankr.
W.D. Tex. Case No. 13-10313) on Feb. 20, 2013, with plans to sell
substantially the facilities as a going-concern in two months.
The Debtor previously sought Chapter 11 protection in January 2008
(Bankr. W.D. Tex. Case No. 08-50040) and exited bankruptcy in May
2008.
In the new Chapter 11 case, the Debtor has tapped Horhmann, Taube
& Summers, LLP, as counsel, CohnReznick LLP, as financial advisor,
and RBC Capital Markets, LLC, as investment banker.
As of the new Chapter 11 filing, the Debtor disclosed $12,095,711
in assets and $27,768,993 in liabilities as of the Chapter 11
filing.
U.S. Trustee for Region 7, Judy A. Robbins, appointed three
members to the Official Unsecured Creditors' Committee in 2013
case. Greenberg Traurig, LLP represents the Committee.
The U.S. Trustee appointed Pamela Rose as patient care ombudsman
for the Debtor.
ADVANCED LIVING: May Employ SWBC as Tax Advisor
-----------------------------------------------
The Hon. H. Christopher Mott of the U.S. Bankruptcy Court for the
Western District of Texas authorized Advanced Living Technologies,
Inc., to employ SWBC as ad valorem tax advisor.
The Debtor has retained SWBC for approximately 20 years in
connection with obtaining absolute exemptions for each of the
facilities, annually filing personal property renditions and
applications for exemption status with six different appraisal
districts, and assisting the law fir of Harrison & Duncan, PLLC in
several lawsuits challenging the exemptions.
SWBC as ad valorem tax advisor will, among other things:
1. set up and maintain in its database all properties
evidences by the property tax accounts identified by the
Debtor for representation, and will verify the accuracy
of all tax assessment information relating therto with
information provided by the client;
2. prepare renditions of the parcels comprising the
property, when applicable, or required by the law; and
3. assign a value appeal(s) to a third-party consultant when
it is determined to be in the Debtor's best interest.
The hourly rate of SWBC's professional agent is $195.
SWVC is scheduled by the Debtor as holding an undisputed general
unsecured claim of $8,398, therefore, SWBC does not hold any
interest adverse to the Debtor or the estate.
About Advanced Living Technologies
Advanced Living Technologies, Inc., owner of six skilled nursing
facilities throughout Texas, filed a Chapter 11 petition (Bankr.
W.D. Tex. Case No. 13-10313) on Feb. 20, 2013, with plans to sell
substantially the facilities as a going-concern in two months.
The Debtor previously sought Chapter 11 protection in January 2008
(Bankr. W.D. Tex. Case No. 08-50040) and exited bankruptcy in May
2008.
In the new Chapter 11 case, the Debtor has tapped Horhmann, Taube
& Summers, LLP, as counsel, CohnReznick LLP, as financial advisor,
and RBC Capital Markets, LLC, as investment banker.
As of the new Chapter 11 filing, the Debtor disclosed $12,095,711
in assets and $27,768,993 in liabilities as of the Chapter 11
filing.
U.S. Trustee for Region 7, Judy A. Robbins, appointed three
members to the Official Unsecured Creditors' Committee in 2013
case. Greenberg Traurig, LLP represents the Committee.
The U.S. Trustee appointed Pamela Rose as patient care ombudsman
for the Debtor.
In May 2013, the Debtor won permission to sell its six not-for-
profit Texas nursing homes for $18 million to Southern TX SNF
Realty LLC. The Court approved the sale on May 10.
ADVANCED LIVING: Taps Agnew & Foster as Special Litigation Counsel
------------------------------------------------------------------
Advanced Living Technologies, Inc. asks the U.S. Bankruptcy Court
for the Western District of Texas for permission to employ Agnew &
Foster PLLC as special litigation counsel.
Agnew Foster will provide assistance to the Debtor and the
Debtor's other professionals in connection with the advising and
representation of the Debtor in the appeal of a Federal Civil
Money Penalty received by the Manor Oaks Nursing Center in
relation to its Federal Survey.
The hourly rates of Agnew Foster's personnel are:
Partners $260
Administrative/Paraprofessional $95 - $180
Agnew Foster has represented the Debtor prior to the Petition
Date.
Agnew Foster is scheduled by the Debtor as holding an undisputed
general unsecured claim of $8,320. In addition, Richard Agnew,
one of the partners in Agnew Foster, is also the sole director of
the Debtor. Agnew has no interest adverse to the Debtor.
A May 23, 2013 hearing at 10 a.m., has been set on the matter.
About Advanced Living Technologies
Advanced Living Technologies, Inc., owner of six skilled nursing
facilities throughout Texas, filed a Chapter 11 petition (Bankr.
W.D. Tex. Case No. 13-10313) on Feb. 20, 2013, with plans to sell
substantially the facilities as a going-concern in two months.
The Debtor previously sought Chapter 11 protection in January 2008
(Bankr. W.D. Tex. Case No. 08-50040) and exited bankruptcy in May
2008.
In the new Chapter 11 case, the Debtor has tapped Horhmann, Taube
& Summers, LLP, as counsel, CohnReznick LLP, as financial advisor,
and RBC Capital Markets, LLC, as investment banker.
As of the new Chapter 11 filing, the Debtor disclosed $12,095,711
in assets and $27,768,993 in liabilities as of the Chapter 11
filing.
U.S. Trustee for Region 7, Judy A. Robbins, appointed three
members to the Official Unsecured Creditors' Committee in 2013
case. Greenberg Traurig, LLP represents the Committee.
The U.S. Trustee appointed Pamela Rose as patient care ombudsman
for the Debtor.
In May 2013, the Debtor won permission to sell its six not-for-
profit Texas nursing homes for $18 million to Southern TX SNF
Realty LLC. The Court approved the sale on May 10.
ADVANCED LIVING: Taps LTC Consulting for Billing and Collection
---------------------------------------------------------------
Advanced Living Technologies, Inc., seeks permission from the U.S.
Bankruptcy Court for the Western District of Texas to employ
Dickman Weston Group, doing business as LTC Consulting Associates,
to perform billing and collection services.
Under the compensation arrangement, the Debtor will pay LTC a
contingency fee for cash receipts per the following:
Phase 1 Contingency fee:
a) 18 percent of cash receipts for accounts with dates of
service 12/31/2012 and prior,
b) 30 percent of the cash receipts for accounts with dates
of services 3-31/2012 and prior; and
Phase 2 (after buildings are sold or control is changed)
Contingency Fee:
a) 18 percent of cash receipts for accounts with date
of service prior to change of control, and
b) 30 percent of cash receipts for accounts with dates
of service 3/31/2012 and prior.
LTC has agreed to a consulting fee of $85 per hour plus expenses,
only if authorized in writing by the Debtor.
To the best of the Debtor's knowledge, LTC has no interest adverse
to the Debtor.
A May 23, 2013 hearing has been set on the matter.
About Advanced Living Technologies
Advanced Living Technologies, Inc., owner of six skilled nursing
facilities throughout Texas, filed a Chapter 11 petition (Bankr.
W.D. Tex. Case No. 13-10313) on Feb. 20, 2013, with plans to sell
substantially the facilities as a going-concern in two months.
The Debtor previously sought Chapter 11 protection in January 2008
(Bankr. W.D. Tex. Case No. 08-50040) and exited bankruptcy in May
2008.
In the new Chapter 11 case, the Debtor has tapped Horhmann, Taube
& Summers, LLP, as counsel, CohnReznick LLP, as financial advisor,
and RBC Capital Markets, LLC, as investment banker.
As of the new Chapter 11 filing, the Debtor disclosed $12,095,711
in assets and $27,768,993 in liabilities as of the Chapter 11
filing.
U.S. Trustee for Region 7, Judy A. Robbins, appointed three
members to the Official Unsecured Creditors' Committee in 2013
case. Greenberg Traurig, LLP represents the Committee.
The U.S. Trustee appointed Pamela Rose as patient care ombudsman
for the Debtor.
In May 2013, the Debtor won permission to sell its six not-for-
profit Texas nursing homes for $18 million to Southern TX SNF
Realty LLC. The Court approved the sale on May 10.
AGSTAR FINANCIAL: S&P Rates Proposed Preferred Stock Offering 'BB'
------------------------------------------------------------------
Standard & Poor's Ratings Services' said it assigned its 'BBB-'
issuer credit rating to AgStar Financial Services ACA. The
outlook is stable. At the same time, S&P assigned a 'BB' issue-
level rating on its proposed preferred stock offering.
"Our 'BBB-' long-term issuer credit rating on AgStar Financial
Services ACA reflects the association's strong asset quality,
track record, stable and low-cost funding profile, and high
regulatory capital measures," said Standard & Poor's credit
analyst Shakir Taylor.
The rating incorporates the ongoing benefits that the company
receives as a government-related entity (GRE) and as part of the
Farm Credit System. S&P also factored into the rating its
assessment that there is a "low" (as S&P's criteria define the
term) likelihood that the U.S. government would provide timely and
sufficient extraordinary support to AgStar in the event of
financial distress. Therefore, AgStar's issuer credit rating does
not incorporate any uplift for extraordinary government support.
In determining AgStar's issuer credit rating, S&P first assign a
stand-alone credit profile and then determine whether AgStar would
receive extraordinary government support in the event of financial
distress.
AgStar's stand-alone credit profile is 'bbb-', based on the
association's fundamental strength, in conjunction with the
ongoing funding advantages that it inherently receives as a member
of the Farm Credit System, which is a government-sponsored entity
(GSE). AgStar, like other associations, is not authorized to take
retail deposits from customers and, as a result, funds its
operations primarily through a line of credit from AgriBank FCS.
These funds are match funded to the credit that AgStar provides
its borrowers, which virtually removes interest rate risk from its
balance sheet. The interest rates on these funds from AgriBank
are very low and sourced from the Federal Farm Credit Banks
Funding Corp., which issues and markets Systemwide Debt Securities
that S&P rates 'AA+'. AgriBank not only serves as AgStar's
primary funding source but also monitors AgStar's underwriting
trends and capital measures to ensure adequacy.
"The stable outlook reflects our expectation that AgStar will
maintain strong capital levels and consistent earnings growth,
without loosening underwriting standards or deteriorating its
credit quality," said Mr. Taylor.
S&P could lower the rating if conditions in commodity and
agricultural real estate markets deteriorate significantly,
causing asset quality to decline. AgStar has historically
employed a conservative business model and careful lending
policies, which its track record of relatively low loan losses
demonstrates; consequently, S&P could downgrade the association if
net charge-offs rise above 1.2% of the portfolio. Another factor
that could lead S&P to lower AgStar's rating is an adverse
regulatory change as a result of budget sequestration and broader
GSE reform that affects the Farm Credit System or its end-
borrowers (farmers and ranchers). S&P expects the new farm bill,
which is still pending Congressional approval, to reflect
significant cuts to programs that benefit borrowers with
protection against various income risks (yield or natural
disasters). If the new farm bill materially cuts government
safety nets, S&P may view it as a negative ratings factor because
it would adverserly affect a large share of AgStar's borrowers.
S&P could raise AgStar's rating over time if AgStar is able to
successfully monetize its diversification efforts without
loosening underwriting standards or sacrificing its currently
strong profit margins.
AGY HOLDING: Moody's Changes PDR to 'Ca-PD' & Keeps CFR at 'Caa2'
-----------------------------------------------------------------
Moody's Investors Service downgraded AGY Holding Corp.'s
Probability of Default Rating to Ca-PD from Caa2-PD following the
company's announcement of an agreement that significantly
increases the likelihood of a distressed debt exchange in the very
near term.
Moody's also affirmed the Caa2 Corporate Family Rating, Caa3
rating on the 11% Second Lien Senior Secured Notes due 2014, and
the SGL-4 Speculative Grade Liquidity Rating. The rating outlook
is negative.
"The agreement is consistent with our view that leverage is too
high to enable a full refinancing and that a debt restructuring is
necessary to reduce leverage to a more sustainable level," said
Ben Nelson, Moody's lead analyst for AGY Holding Corp.
Issuer: AGY Holding Corp.
Corporate Family Rating, Affirmed Caa2
Probability of Default Rating, Downgraded to Ca-PD from Caa2-PD
Senior Secured Notes due November 2014, Affirmed Caa3 (LGD4 61%)
Speculative Grade Liquidity Rating, Affirmed SGL-4
Outlook, Negative
AGY did not make the May 15 coupon payment on its 11% Second Lien
Senior Secured Notes due 2014; instead, the company announced that
it had reached agreement with the vast majority of its bondholders
on an out of court restructuring plan. Following the expiration of
the thirty day grace period on the missed coupon payments in the
indenture governing the 11% Senior Secured Notes due 2014 or the
completion of the proposed debt restructuring plan, Moody's
expects to append an /LD designation to the Probability of Default
Rating.
Per the terms of the Restructuring and Support Agreement contained
in an 8K filed on May 15, 2013, participating holders of the 2014
notes will exchange the outstanding notes for: (i) new 11% Second
Lien Senior Secured Notes due December 15, 2016 worth roughly $100
million; and (ii) convertible preferred shares. Accrued and unpaid
interest will be paid 50% in cash and 50% in new convertible
preferred shares. The convertible preferred shares will convert
into 51% of the common equity following the closing of the debt
exchange. Approximately 92% of the required 97% of holders have
agreed to the debt restructuring transaction. The transaction is
also subject to the company and majority holders using
commercially reasonable efforts to amend or replace the revolving
credit facility, amend or replace the master lease agreement,
obtain a new $15 million term loan provided by existing
bondholders, and amend or sign other new agreements. Existing
revolver and master lease agreements have been amended to forbear
the exercise of rights related to the missed interest payment on
the notes. Failure to consummate the Restructuring and Support
Agreement by July 15, 2013, could invalidate these agreements and
in such a scenario Moody's cannot rule out a bankruptcy filing.
Ratings Rationale:
The Caa2 Corporate Family Rating is constrained primarily by weak
liquidity and the impending debt restructuring transaction. The
rating also considers modest size, exposure to cyclical end
markets, and product and customer concentration. Cost reduction
activities and increased focus on higher-margin specialty products
should continue to benefit the company's operating performance.
The negative rating outlook reflects the potential for a rating
downgrade if the company is unable to complete its Restructuring
and Support Agreement. Moody's could downgrade the rating if it
becomes evident that the company will not be able to meet the
terms of the agreement such that a bankruptcy filing is more
likely. Moody's could upgrade the rating if AGY reaches
restructures its debt in a fashion that positions the company with
a more sustainable leverage position, prospects for free cash
flow, and adequate liquidity to support operations.
The principal methodology used in this rating was the Global
Chemical Industry Methodology published in December 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
AGY Holding Corp. manufactures advanced glass fibers used as
reinforcing materials. These products are used in applications
ranging from aircraft laminates, ballistic armor, roofing
membranes, continuous filament mat, architectural fabrics, and
specialty electronics in end markets such as aerospace, defense,
construction, and electronics. Private equity firm Kohlberg &
Company acquired the company in 2006.
AGY HOLDING: S&P Lowers Corporate Credit Rating to 'D'
------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on AGY Holding Corp. to 'D' from 'CCC-'. S&P also
lowered its issue-level rating on its $175 million 11% second lien
notes ($172 million outstanding) due 2014 to 'D' from 'C'. S&P's
recovery rating on the notes is '6', indicating its expectation
for negligible (0%-10%) recovery.
"The rating actions follow the company's announcement that it has
not made approximately $10 million in interest payments due
May 15, 2013 on its 11% second-lien notes maturing 2014," said
Standard & Poor's credit analyst Paul Kurias.
The company also announced it has entered into an agreement with
holders of 92% of its 11% senior unsecured notes to exchange the
notes for preference shares and new second-lien notes maturing
Dec. 15, 2016. The exchange offer expires on July 15, 2013. In
connection with this exchange offer the company says it has
entered into forbearance agreements through July 15, 2013, with
creditors on the notes, its asset-based revolving credit facility
(which is unrated), and a metals lease facility, which has been
extended through July 15, 2013.
AGY and its operating subsidiaries manufacture glass yarns with
varying degrees of specialization and technological complexity.
The company's products are geared to niche, and sometimes
customized, applications in end markets that include aerospace,
defense, construction, and electronics. Privately owned, AGY
typically sells its products to an intermediary that weaves yarns
for its own customers, although AGY is significantly involved in
the marketing of its products to end users. In recent quarters,
the company has been unable to generate adequate business volume
or to demonstrate sufficient pricing power to offset its high
fixed costs. Very onerous debt levels have exacerbated AGY's weak
operating performance, contributing to a high interest outflow in
excess of cash generation. Several quarters of weak operating
performance and weak liquidity eroded financial flexibility and
the willingness of creditors to extend critical working capital
facilities on a long-term basis.
The private investment company Kohlberg & Co. LLC, through its
affiliates, acquired AGY during April 2006. AGY emerged from
Chapter 11 protection in April 2004. In December 2002, the
predecessor company, Advanced Glassfiber Yarns LLC, had filed for
Chapter 11 following a sharp decline in its revenues and profit
margins because of an unexpected decline in some customer
segments.
AJ & M: Case Summary & 16 Unsecured Creditors
---------------------------------------------
Debtor: AJ & M Enterprises Corp
aka Texaco Trujillo Alto Plaza
Diaz Service Station
P.O. Box 159
Trujillo Alto, PR 00977
Bankruptcy Case No.: 13-03763
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
District of Puerto Rico (Old San Juan)
Judge: Enrique S. Lamoutte Inclan
Debtor's Counsel: William M. Vidal, Esq.
WILLIAM VIDAL CARVAJAL LAW OFFICES
255 Ponce De Leon Avenue, Suite 801
San Juan, PR 00917
Tel: (787) 764-6867
(787) 399-6415
Fax: 787-764-6496
E-mail: william.m.vidal@gmail.com
Scheduled Assets: $2,206,130
Scheduled Liabilities: $3,373,779
The Company's list of its 16 largest unsecured creditors filed
with the petition is available for free at:
http://bankrupt.com/misc/prb13-03763.pdf
The petition was signed by Jacinto Diaz Marrero, president.
ALLY FINANCIAL: S&P Puts 'B+' Credit Rating on Watch Positive
-------------------------------------------------------------
Standard & Poor's Ratings Services said it placed its ratings,
including its 'B+' long- and 'C' short-term counterparty credit
ratings, on Ally Financial Inc. (Ally) on CreditWatch with
positive implications
On May 14, Ally announced that it has entered into a plan support
agreement with the bankruptcy estate of its former subsidiary
Residential Capital LLC (ResCap) and with ResCap creditors.
Although the terms of the agreed plan have not yet been announced,
Ally has stated that the plan will "settle all existing and
potential claims" on Ally relating to ResCap liabilities and
securitization-related legal claims (other than two specific
claims that are not covered by the agreement).
"The possible release of Ally from ResCap-related liabilities and
claims would remove a significant element of financial risk and
uncertainty from Ally's credit profile, and also eliminate what we
view as a source of potential distraction for Ally's management,"
said Standard & Poor's credit analyst Thomas Connell. S&P has
previously stated that it would consider raising the ratings if
the company secures a release from ResCap-related claims on terms
that are not unduly punitive to Ally, and assuming there have been
no other offsetting developments.
S&P has consistently viewed uncertainty relating to Ally's
potential exposure to ResCap-related liabilities and legal claims
as a significant drag on Ally's credit profile. ResCap's Chapter
11 bankruptcy filing in May 2012 contained a proposed plan that
recognized $8.7 of litigation-related claims, in addition to
ResCap's direct secured and unsecured liabilities. On May 17,
2012, S&P revised the outlook on Ally to positive from stable,
recognizing the potential for the ResCap bankruptcy process to
lead to Ally's release from ResCap-related liabilities.
As part of an original proposal to extinguish its exposure to
ResCap claims, Ally had proffered a cash contribution of
$750 million to the ResCap bankruptcy estate, along with other
measures to support the value of the estate to creditors. S&P
expects that the agreement announced this week entails an
additional contribution from Ally. Due to the recent sale of the
company's international operations (with a pro forma 200-basis
point positive impact on Ally's Tier 1 common capital ratio at
first-quarter 2013), S&P believes that Ally has financial capacity
to provide some additional consideration to the ResCap estate to
attain a release from ResCap-related claims. The combination of
manageable financial impact of this settlement, and the related
reduction in uncertainty regarding potential future legal claims,
would likely provide a basis for an upgrade.
The positive CreditWatch reflects S&P's view of the potential for
the plan support agreement to eliminate certain ResCap-related
risks that S&P has incorporated into its view of Ally's risk
profile. Subject to S&P's review of the agreement, and followed
by its finalization and implementation, it could raise the
counterparty credit ratings on Ally by one notch. If the
agreement is sufficiently onerous such that its impact on Ally's
financial profile offsets the benefit from reduced risk and
uncertainty, S&P could affirm the ratings at the current levels.
AMERICAN AIRLINES: Seeks Formal OK of Plan-Support Agreement
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that AMR Corp.'s announcement in February it would merge
with US Airways Group Inc. as the basis for a reorganization plan
at the time was supported by holders of $1.2 billion in claims.
Since then, other creditors joined the so-called plan-support
agreement, raising the total to $1.6 billion.
According to the report, the parent of American Airlines Inc.
filed papers with the bankruptcy court seeking formal approval of
the support agreement. The approval hearing is set for June 4.
The agreement lays out terms of the plan where AMR constituencies
will receive 72 percent of the stock of the merged airlines.
Depending on the price the stock fetches in the market, AMR
creditors could be paid in full. AMR shareholders are to receive
a minimum of 3.5 percent of the stock. The agreement entails
payment of professional fees incurred by the ad hoc creditor group
that is part of the support agreement.
On May 30, the bankruptcy court will hold a hearing to approve
disclosure materials explaining the reorganization plan
incorporating the merger with US Airways.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements. AMR, previously the world's largest airline prior to
mergers by other airlines, is the last of the so-called U.S.
legacy airlines to seek court protection from creditors.
Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the
Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, are on board as special counsel. Rothschild
Inc., is the financial advisor. Garden City Group Inc. is the
claims and notice agent.
Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and
Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP
serve as counsel to the Official Committee of Unsecured Creditors
in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the
co-counsel for conflicts and other matters; Moelis & Company LLC
is the investment banker, and Mesirow Financial Consulting, LLC,
is the financial advisor.
The Retiree Committee is represented by Jenner & Block LLP's
Catherine L. Steege, Esq., Charles B. Sklarsky, Esq., and Marc B.
Hankin, Esq.
AMR and US Airways Group, Inc., on Feb. 14, 2013, announced a
definitive merger agreement under which the companies will combine
to create a premier global carrier, which will have an implied
combined equity value of approximately $11 billion. The deal is
subject to clearance by U.S. and foreign regulators and by the
bankruptcy judge overseeing AMR's bankruptcy case.
In April 2013, AMR filed a Chapter 11 plan of reorganization that
will carry out the merger. By distributing stock in the merged
airlines, the plan is designed to pay all creditors in full, with
interest.
Bankruptcy Creditors' Service, Inc., publishes AMERICAN AIRLINES
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by AMR Corp. and its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000).
AMF BOWLING: Files New Chapter 11 Plan & Disclosure Statement
-------------------------------------------------------------
AMF Bowling Worldwide, Inc. and certain of its affiliates filed a
new chapter 11 plan of reorganization and disclosure statement on
May 18 sponsored by Strike Holdings LLC (known as "Bowlmor"), and
certain of AMF's second lien lenders, including Cerberus Series
Four Holdings, LLC, and Credit Suisse.
The plan provides that AMF will be reorganized and combined with
Bowlmor to form a company that will be known as Bowlmor AMF, which
would be the largest operator of bowling centers in the world with
7,500 employees, 276 bowling centers and combined annual revenues
of approximately $450 million. The plan provides that AMF's
second lien lenders will convert their debt into equity in Bowlmor
AMF, so that Bowlmor AMF will be owned jointly by the financial
institutions that hold AMF's second lien debt and by equity
holders in Bowlmor. Credit Suisse will provide a term loan
facility in the principal amount of $230 million, and a revolving
loan facility in the principal amount of $30 million. The largest
holders of AMF's existing second lien debt have expressed their
confidence in the new company by providing $50 million of backstop
financing, which will be used to provide working capital for
Bowlmor AMF and to pay cash distributions in varying amounts to
AMF's other creditors. In addition to second lien lenders, the
plan has the support of the Official Committee of Unsecured
Creditors. AMF's first lien lenders will receive payment in full,
in cash, of principal, interest at the non-default rate, and their
fees.
"The prospect of combining Bowlmor's proven approach to operations
and marketing with the AMF brand, its large number of locations
and national market penetration represents an exciting opportunity
for both companies," said Bowlmor's Founder and CEO Tom Shannon,
who will serve as the Chairman, CEO and President of the combined
company. "The combination will not only result in a strong
company but also the best bowling experience possible. We are
committed to making Bowlmor AMF a truly great company for the
bowling public, our partners and our employees."
Joining Shannon on Bowlmor AMF's executive team will be Bowlmor's
President and Chief Financial Officer, Brett Parker, who will
become Vice Chairman, CFO and EVP of Bowlmor AMF. The new Bowlmor
AMF will be jointly owned by AMF's existing second lien lenders,
who will hold 77.53%, and Shannon and Parker, who will
collectively hold 22.47% of the new company.
Steve Satterwhite, AMF's Chief Operating Officer and Chief
Financial Officer said, "AMF's operational and financial
performance through our reorganization process has set the stage
for a successful emergence from bankruptcy. It is thanks to the
dedication and hard work of AMF's employees and management team
that we recently posted the best same store sales growth since
2007 and the highest profitability since 2009, achieving
impressive results despite the challenges of the restructuring and
economic conditions."
The next step in this process is a hearing set for May 23, 2013 at
which the Bankruptcy Court in Virginia overseeing AMF's chapter 11
case will be asked to approve the disclosure statement so that the
plan can be sent to AMF's creditors for approval. Assuming that
the Bankruptcy Court approves the disclosure statement on May 23,
the plan will be sent out for a vote and the Bankruptcy Court will
schedule a hearing to confirm the plan. Pending court approval,
AMF could emerge from bankruptcy and combine with Bowlmor by the
end of June.
More information about AMF's restructuring is available at
http://www.AMF.com/restructuring
Court filings and claims information are available at
http://www.kccllc.net/AMF
About Bowlmor
With headquarters in New York City, Bowlmor operates upscale
bowling and entertainment venues that specialize in corporate and
team building events, private parties, fundraisers, and social
events, as well as offer walk-in retail bowling. Bowlmor creates
imaginative, exciting, and memorable entertainment that features
high-end, stylish bowling in a chic, modern lounge setting.
Bowlmor locations have often earned several hundred thousand
dollars per lane per year making it one of the best performing
bowling facility operators in North America.
About AMF Bowling
AMF is the world's largest owner and operator of bowling centers.
Since the introduction of the automated pinspotter in 1946, AMF
has been a leader in the bowling industry. More than 20 million
bowlers per year make AMF their bowling destination of choice. AMF
is where America goes bowling.
AMKOR TECHNOLOGY: S&P Rates $200MM Sr. Unsecured Notes 'BB'
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' rating to
Chandler, Ariz.-based outsourced semiconductor packaging and
testing services supplier Amkor Technology Inc.'s proposed
$200 million senior unsecured notes due 2022 (the same level as
the corporate credit rating on the company). The recovery rating
on the notes is '4'. The company will use the proceeds, along
with cash on hand, for general corporate purposes.
This transaction does not affect S&P's 'BB' corporate credit
rating on the company. However, S&P has revised the recovery
rating on the company's existing senior unsecured notes to '4'
from '3', indicating the expectation for average (30% to 50%)
recovery in the event of a payment default. Concurrent with the
$200 million senior unsecured notes, Amkor will induce the
conversion of its $250 million convertible senior subordinated
notes due 2014. In S&P's view, Amkor's financial profile will
remain intact and be consistent with a "significant" financial
risk profile over a typical industry cycle. S&P expects adjusted
leverage to be at about the 3x area over the next year.
RATINGS LIST
Amkor Technology Inc.
Corporate Credit Rating BB/Stable/--
New Ratings
Amkor Technology Inc.
Senior Unsecured
$200M notes due 2022 BB
Recovery Rating 4
Recovery Rating Revised
To From
Amkor Technology Inc.
Senior Unsecured Notes BB BB
Recovery Rating 4 3
ARCAPITA BANK: Test Case on Subordination of Stock-Fraud Claims
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the almost-completed reorganization of Bahraini
investment bank Arcapita Bank BSC will give U.S. Bankruptcy Judge
Sean Lane an opportunity to clarify an ambiguity in bankruptcy law
dealing with the automatic subordination of claims based on fraud
in the sale of securities.
According to the report, three years ago Arcapita unit Falcon Gas
Storage Inc. sold NorTex Gas Storage LLC to Tide Natural Gas
Storage I LP and an affiliate for $515 million. Before the year
was out, Tide sued Falcon and Arcapita for fraud. Tide followed
up by filing a claim in Arcapita and Falcon's bankruptcy.
The claim, the report relates, raises the question of whether any
liability owing to Tide is subordinated and, if so, how deeply.
Judge Lane is scheduled to hold a June 10 hearing on the question.
Section 510 of the U.S. Bankruptcy Code teaches that a claim based
on sale of a security is automatically subordinated to "all claims
or interests that are senior to or equal the claim or interest
represented by such security."
Mr. Rochelle reports the first question for Judge Lane is whether
automatic subordination even applies given that Tide didn't buy
stock; it bought interests in a limited liability company.
Assuming Arcapita prevails on the first question, the next issue
is to what level is Tide's claim subordinated. The second
question invokes a proviso in Section 510 saying that if the claim
is based on a sale of "common stock," the claim is subordinated to
the same level as common stock, not below stock.
Arcapita takes the position that the proviso for common stock
doesn't apply because common stock and interests in an LLC are not
the same. Arcapita therefore would have Tide's claim subordinated
below ownership interests.
Tide is scheduled to file papers on May 29.
About Arcapita Bank
Arcapita Bank B.S.C., also known as First Islamic Investment Bank
B.S.C., along with affiliates, filed for Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19,
2012. The Debtors said they do not have the liquidity necessary
to repay a US$1.1 billion syndicated unsecured facility when it
comes due on March 28, 2012.
Falcon Gas Storage Company, Inc., filed a Chapter 11 petition
(Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas
is an indirect wholly owned subsidiary of Arcapita that previously
owned the natural gas storage business NorTex Gas Storage Company
LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a
Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II,
L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock
of NorTex from Falcon Gas for $515 million. Arcapita guaranteed
certain of Falcon Gas' obligations under the NorTex Purchase
Agreement.
The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy
counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP
as international counsel on Bahrain matters, Hatim S Zu'bi &
Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild
Inc. and financial advisor, and GCG Inc. as notice and claims
agent.
Milbank, Tweed, Hadley & McCloy LLP represents the Official
Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc.,
serves as its financial advisor and investment banker.
Founded in 1996, Arcapita is a global manager of Shari'ah-
compliant alternative investments and operates as an investment
bank. Arcapita is not a domestic bank licensed in the United
States. Arcapita is headquartered in Bahrain and is regulated
under an Islamic wholesale banking license issued by the Central
Bank of Bahrain. The Arcapita Group employs 268 people and has
offices in Atlanta, London, Hong Kong and Singapore in addition to
its Bahrain headquarters. The Arcapita Group's principal
activities include investing on its own account and providing
investment opportunities to third-party investors in conformity
with Islamic Shari'ah rules and principles.
The Arcapita Group had roughly US$7 billion in assets under
management. On a consolidated basis, the Arcapita Group owns
assets valued at roughly US$3.06 billion and has liabilities of
roughly US$2.55 billion. The Debtors owe US$96.7 million under
two secured facilities made available by Standard Chartered Bank.
Arcapita explored out-of-court restructuring scenarios but was
unable to achieve 100% lender consent required to effectuate the
terms of an out-of-court restructuring.
Subsequent to the Chapter 11 filing, Arcapita Investment Holdings
Limited, a wholly owned Debtor subsidiary of Arcapita in the
Cayman Islands, issued a summons seeking ancillary relief from the
Grand Court of the Cayman Islands with a view to facilitating the
Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as
provisional liquidator.
The Debtors' Chapter 11 plan contemplates, among others, the entry
of the Debtors into a $185 million Murabaha exit facility that
will allow the Debtors to wind down their businesses and assets
for the benefit of all creditors and stakeholders.
Creditors are voting on Arcapita's reorganization plan in advance
of a June 11 confirmation hearing.
ARTEL LLC: Slow Orders Cue Moody's to Change Outlook to Negative
----------------------------------------------------------------
Moody's Investors Service has revised the rating outlook of Artel,
LLC to Negative from Stable. Concurrently, all ratings, including
the B3 Corporate Family Rating, have been affirmed.
Ratings:
Corporate Family, affirmed at B3
Probability of Default, affirmed at B3-PD
$15 million first lien revolver due 2017, affirmed at B2, LGD3,
38%
$100 million first lien term loan due 2017, affirmed at B2, LGD3,
38%
Rating Outlook:
To Negative from Stable
Ratings Rationale:
The Negative rating outlook reflects a slower than expected rate
of new task awards that the company has been experiencing under
one of its key contract vehicles (Custom SATCOM Solutions, "CS2").
Without a greater flow of new orders, Artel's backlog will
probably not grow over 2013 as was envisioned in October 2012 when
the rating was initially assigned. Without backlog growth, ability
to meet near-term covenant test step-downs will probably diminish,
taking with it adequacy of Artel's liquidity profile. Budget
pressures from sequestration may continue limiting Artel's task
order wins.
The B3 Corporate Family Rating has nonetheless been affirmed
because the company's credit metrics are expected to remain on par
with the rating category despite the lack of backlog growth. On a
Moody's adjusted basis (which includes partial equity credit for
preferred stock), debt to EBITDA below 6x in 2013 still seems
achievable. With good working capital management and no revenue
erosion, Artel should be able to generate free cash flow in excess
of its scheduled debt amortizations. The CEO change that occurred
soon after Artel closed its $115 million credit facility in 2012
was unanticipated and could have been disruptive since the prior
CEO was in the process of negotiating a significant marketing
agreement between Boeing and Artel. The agreement, as planned, was
to bring Artel capacity rights on three satellites planned for
launch over the next two years. The satellite access would offer
significant revenue opportunity for Artel since the resulting high
capacity bandwidth will likely be attractive to the federal
government. Artel's rights to the bandwidth could improve its odds
of winning profitable task orders and expanding its business
franchise. But as outlined, the agreement also carried significant
capital and lease payment obligations, tempering considerations in
light of the company's modest scale and liquidity. The new CEO
successfully re-directed the negotiations and ultimately executed
the agreement in a way that should make Artel's financial
commitment under it less onerous than was previously anticipated.
Operational restructuring efforts underway to lower the fixed cost
base seem similarly prudent in light of the choppy US defense
funding environment ahead.
The rating would be downgraded if likelihood of a financial
covenant breach grows, or if debt to EBITDA exceeds 6x or if the
free cash flow expectation weakens. The outlook would be
stabilized with debt to EBITDA in the 5x to 6x range and
likelihood of an ongoing adequate liquidity profile. The rating
would be upgraded with funded backlog growth and expectation of
debt to EBITDA at 5x or below.
The principal methodology used in this rating was the Global
Aerospace and Defense Industry Methodology published in June 2010.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Artel, LLC designs and delivers managed network services involving
land-based and commercial satellite capacity to U.S. government
customers. The company is majority-owned by the financial sponsors
TPG Growth, LLC and Torch Hill Investment Partners LLC. In 2012
revenues of the parent holding company, Artel Holdings, LLC, were
about $320 million.
ARZBERG-PORZELLAN: German Tableware Maker Files Chapter 15
----------------------------------------------------------
Arzberg-Porzellan GmbH, a 125-year-old German tableware
manufacturer, filed a petition for Chapter 15 protection on
May 6 in St. Louis, Missouri (Bankr. E.D. Mo. Case No. 13-44255).
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Schirnding, Germany-based company became the
subject of reorganization proceedings in Germany in January.
The company's foreign representative filed the Chapter 15 petition
to stop a breach-of-contract lawsuit in Missouri state court.
Assets are 9.56 million euros ($12.3 million) and debt totals 4.63
million euros.
ATLANTIC & PACIFIC: Claims v. Yucaipa in Securities Suit Junked
---------------------------------------------------------------
Lead Plaintiffs City of New Haven Employees' Retirement System and
Plumbers and Pipefitters Locals 502 & 633 Pension Trust Fund filed
a federal securities class action on behalf of purchasers of the
securities of The Great Atlantic & Pacific Tea Company (A&P)
between July 23, 2009 and December 10, 2010. The Plaintiffs
alleged that, throughout the Class Period, the A&P Defendants
falsely stated that A&P was making progress in implementing its
turnaround initiatives but the truth was that A&P's operational
and financial conditions were continuing to rapidly deteriorate,
and the Company's turnaround efforts were constrained by its high
rate of cash burn and worsening liquidity crisis. On December 12,
2010, A&P confirmed that it filed a petition for bankruptcy
protection under Chapter 11.
On March 16, 2012, the Plaintiffs filed an Amended Complaint
against Christian W. E. Haub, Eric Claus, Brenda M. Galgano,
Ronald Marshall, Samuel Martin, and Frederic Brace (the A&P
Defendants); and The Yucaipa Companies LLC and Ronald Burkle (the
Yucaipa Defendants). The Amended Complaint asserts two causes of
action: (1) Count 1: violation of Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5; and (2) Count 2: violation of
Section 20(a) of the Exchange Act.
The A&P Defendants and the Yucaipa Defendants moved to dismiss
both counts.
On April 30, 2013, District Judge William J. Martini granted in
part, and denied in part the A&P Defendants' motion to dismiss.
The A&P Defendants' motion to dismiss Count 1 is denied with
respect to Defendants Claus, Galgano, Haub, and Brace. The motion
to dismiss Count 1 is granted with respect to Defendants Marshall
and Martin, as they were not responsible for any of the
misstatements or omissions, ruled Judge Martini. The A&P
Defendants' motion to dismiss Count 2 is denied as to Claus,
Galgano, Haub, and Brace, and granted as to Marshall and Martin.
With respect to the Yucaipa Defendants, the Plaintiffs raise two
different theories of liability under Rule 10b-5. The Court finds
that both theories fail because the Plaintiffs failed to allege
scienter. Because the Plaintiffs failed to state a claim for an
underlying Section 10(b) violation, the Plaintiffs cannot state a
claim under Section 20(a) either.
Accordingly, the Yucaipa Defendants' motion to dismiss is granted,
and the claims against Yucaipa are dismissed with prejudice, Judge
Martini concluded.
The case is RICKY DUDLEY, individually and on behalf of all others
similarly situated, Plaintiff, v. CHRISTIAN W.E. HAUB, et al.,
Defendants, Civ. No. 2:11-cv-05196 (WJM), (D. N.J.).
A copy of the District Court's April 30, 2013 Opinion is available
at http://is.gd/0kIxysfrom Leagle.com.
About Great Atlantic & Pacific
Founded in 1859, Montvale, New Jersey-based Great Atlantic &
Pacific is a supermarket retailer, operating under a variety of
well-known trade names, or "banners" across the mid-Atlantic and
Northeastern United States.
A&P and its affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y.
Case No. 10-24549) on Dec. 12, 2010, in White Plains, New York.
Before filing for bankruptcy in 2010, A&P operated 429 stores in
eight states and the District of Columbia under the following
trade names: A&P, Waldbaum's, Pathmark, Pathmark Sav-a-Center,
Best Cellars, The Food Emporium, Super Foodmart, Super Fresh and
Food Basics. A&P had 41,000 employees prior to the bankruptcy
filing.
In its petition, A&P reported total assets of $2.5 billion and
liabilities of $3.2 billion as of Sept. 11, 2010.
Paul M. Basta, Esq., James H.M. Sprayregen, Esq., and Ray C.
Schrock, Esq., at Kirkland & Ellis, LLP, in New York, and James J.
Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois,
served as counsel to the Debtors. Kurtzman Carson Consultants LLC
acted as the claims and notice agent. Lazard Freres & Co. LLC
served as the financial advisor. Huron Consulting Group served as
management consultant. Dennis F. Dunne, Esq., Matthew S. Barr,
Esq., and Abhilash M. Raval, Esq., at Milbank, Tweed, Hadley &
McCloy LLP, represented the Official Committee of Unsecured
Creditors.
The Bankruptcy Court entered an order Feb. 27, 2012, confirming a
First Amended Joint Plan of Reorganization filed Feb. 17, 2012.
A&P consummated its financial restructuring and emerged from
Chapter 11 as a privately held company in March 2012.
A&P sold or closed stores during the bankruptcy proceedings. It
emerged from bankruptcy with 320 supermarkets. Among others, A&P
sold 12 Super-Fresh stores in the Baltimore-Washington area for
$37.83 million, plus the value of inventory. Thirteen other
locations didn't attract buyers at auction and were closed mid-
July 2011.
Mount Kellett Capital Management LP, The Yucaipa Companies LLC and
investment funds managed by Goldman Sachs Asset Management, L.P.,
provided $490 million in debt and equity financing to sponsor
A&P's reorganization plan and complete its balance sheet
restructuring. JP Morgan and Credit Suisse arranged a
$645 million exit financing facility.
ATLANTIC COAST: Incurs $2 Million Net Loss in First Quarter
-----------------------------------------------------------
Atlantic Coast Financial Corporation filed with the U.S.
Securities and Exchange Commission its quarterly report on Form
10-Q disclosing a net loss of $2.03 million on $7.53 million of
total interest and dividend income for the three months ended
March 31, 2013, as compared with a net loss of $1.71 million on
$8.74 million of total interest and dividend income for the same
period a year ago.
The Company's balance sheet at March 31, 2013, showed $747.57
million in total assets, $710.23 million in total liabilities and
$37.34 million in total stockholders' equity.
Commenting on the first quarter results, G. Thomas Frankland,
president and chief executive officer, said, "We continue to see
measurable improvement in credit quality as indicated by reduced
non-performing loans and lower net loan charge-offs.
Notwithstanding this progress, other issues remain pressing,
particularly the immediate need for the Company to address capital
levels mandated by our regulators and the impact of our high-cost
wholesale debt, which continues to pressure our net interest
margin and drag on our liquidity. The significance of the
wholesale debt is evident in its fair-value which as of March 31,
2013 exceeded the book value by $27.7 million due to the high
interest rate of the debt and remaining term. As we announced
earlier, our pending merger with Bond Street Holdings, Inc.
focuses specifically on those issues - immediately satisfying our
capital mandate and resolving our high-cost debt, and as a result,
we believe this transaction will successfully achieve the
Company's goal of providing maximum value to our stockholders.
Additionally, after the merger this strategic alternative should
result in a sound banking platform for the long term as part of a
large and strong community bank, with the least amount of
execution risk."
A copy of the Form 10-Q is available for free at:
http://is.gd/cmCGpo
About Atlantic Coast
Jacksonville, Florida-based Atlantic Coast Financial Corporation
is the holding company for Atlantic Coast Bank, a federally
chartered and insured stock savings bank. It is a community-
oriented financial institution serving northeastern Florida and
southeastern Georgia markets through 12 locations, with a focus on
the Jacksonville metropolitan area.
The Company reported a net loss of $6.66 million on $33.50 million
of total interest and dividend income for the year ended Dec. 31,
2012, as compared with a net loss of $10.28 million on $38.28
million of total interest and dividend income in 2011.
McGladrey LLP, in Jacksonville, Florida, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012. The independent auditors noted that the
Company has suffered recurring losses from operations that have
adversely impacted capital at Atlantic Coast Bank. The failure to
comply with the regulatory consent order may result in Atlantic
Coast Bank being deemed undercapitalized for purposes of the
consent order and additional corrective actions being imposed that
could adversely impact the Company's operations. This raises
substantial doubt about the Company's ability to continue as a
going concern.
ATLANTIC COAST: Two Opposing Directors Demand CEO's Resignation
---------------------------------------------------------------
Messrs. Jay S. Sidhu and Bhanu Choudhrie delivered an additional
letter on May 13 to the Board of Directors reaffirming their
opposition to the merger between Atlantic Coast Financial
Corporation and Bond Street Holdings, Inc., and their continuing
intention to vote against the Merger because of the inadequacy of
the price.
"As we have noted in our earlier correspondence, we believe that
the $5 per share offer by Bond Street to cash out ACFC's
stockholders greatly undervalues ACFC," Messrs. Sidhu and
Choudhrie assert.
Messrs. Sidhu and Choudhrie, two of the Company's directors, also
demanded the calling of the Company's 2013 Annual Meeting and the
resignation of Thomas Frankland, the Company's Chief Executive
Officer.
"For a variety of reasons, we do not believe that Mr. Frankland is
capable of providing the type of leadership needed for ACFC to
achieve its goals," the letter stated.
A copy of the May 13 Letter is available for free at:
http://is.gd/tLyA9g
About Atlantic Coast
Jacksonville, Florida-based Atlantic Coast Financial Corporation
is the holding company for Atlantic Coast Bank, a federally
chartered and insured stock savings bank. It is a community-
oriented financial institution serving northeastern Florida and
southeastern Georgia markets through 12 locations, with a focus on
the Jacksonville metropolitan area.
The Company reported a net loss of $6.66 million on $33.50 million
of total interest and dividend income for the year ended Dec. 31,
2012, as compared with a net loss of $10.28 million on $38.28
million of total interest and dividend income in 2011.
The Company's balance sheet at March 31, 2013, showed $747.57
million in total assets, $710.23 million in total liabilities and
$37.34 million in total stockholders' equity.
McGladrey LLP, in Jacksonville, Florida, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012. The independent auditors noted that the
Company has suffered recurring losses from operations that have
adversely impacted capital at Atlantic Coast Bank. The failure to
comply with the regulatory consent order may result in Atlantic
Coast Bank being deemed undercapitalized for purposes of the
consent order and additional corrective actions being imposed that
could adversely impact the Company's operations. This raises
substantial doubt about the Company's ability to continue as a
going concern.
ATLANTIC COAST: Amin Ali Held 9.5% Equity Stake at March 11
-----------------------------------------------------------
In an amended Schedule 13D filing with the U.S. Securities and
Exchange Commission, Mr. Amin Fadul Ali disclosed that, as of
March 11, 2013, he beneficially owned 250,000 shares of common
stock of Atlantic Coast Financial Corporation representing 9.5% of
the shares outstanding. A copy of the regulatory filing is
available for free at http://is.gd/UtpILo
About Atlantic Coast
Jacksonville, Florida-based Atlantic Coast Financial Corporation
is the holding company for Atlantic Coast Bank, a federally
chartered and insured stock savings bank. It is a community-
oriented financial institution serving northeastern Florida and
southeastern Georgia markets through 12 locations, with a focus on
the Jacksonville metropolitan area.
The Company reported a net loss of $6.66 million on $33.50 million
of total interest and dividend income for the year ended Dec. 31,
2012, as compared with a net loss of $10.28 million on $38.28
million of total interest and dividend income in 2011.
The Company's balance sheet at March 31, 2013, showed $747.57
million in total assets, $710.23 million in total liabilities and
$37.34 million in total stockholders' equity.
McGladrey LLP, in Jacksonville, Florida, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012. The independent auditors noted that the
Company has suffered recurring losses from operations that have
adversely impacted capital at Atlantic Coast Bank. The failure to
comply with the regulatory consent order may result in Atlantic
Coast Bank being deemed undercapitalized for purposes of the
consent order and additional corrective actions being imposed that
could adversely impact the Company's operations. This raises
substantial doubt about the Company's ability to continue as a
going concern.
ATLANTIC POWER: S&P Puts 'BB-' CCR on CreditWatch Negative
----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit rating on Atlantic Power Corp. on CreditWatch with negative
implications.
The CreditWatch placement reflects the potential covenant trip and
what S&P believes to be a deterioration in the credit quality of
the company, demonstrated by a continued deterioration in key
credit measures, as well as Atlantic Power's announcement that,
based on current projections, it may not be able to meet the
interest coverage ratio test under its senior revolving credit
facility beginning in the third quarter of this year. The
potential covenant trip is being driven primarily by revisions to
the timing and return on the anticipated investment of
$140 million to $150 million in proceeds from asset divestitures
(due in part to an increased share of these investments going into
construction and development, which contributes to cash flow lag),
as well as uncertainties surrounding the timing and level of 2013
financial results at the Piedmont Green Power project. The senior
revolving credit facility is Atlantic Power's primary source of
liquidity and matures in November 2015.
"We expect to resolve the CreditWatch listing after the potential
covenant violation issues are resolved. In the interim, we will
also reassess our financial projections for the company given
recent developments to ascertain whether near-term forecasted
credit ratios remain commensurate with a 'BB-' or lower rating.
We expect to complete this review over the next two to three
weeks," said Standard & Poor's credit analyst Rubina Zaida.
To maintain ratings, S&P would expect average cash flow after debt
service (CFADS) to debt and CFADS to interest coverage to be at
least 17% and 2.4x, respectively. A downgrade could occur if the
company's CFADS to debt and CFADS to interest coverage drops below
the aforementioned levels.
BBX CAPITAL: Incurs $6.5 Million Net Loss in First Quarter
----------------------------------------------------------
BBX Capital Corporation filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $6.53 million on $5.59 million of total revenues for
the three months ended March 31, 2013, as compared with a net loss
of $14.21 million on $9.75 million of total revenues for the same
period a year ago.
The Company's balance sheet at March 31, 2013, showed $432.48
million in total assets, $198.13 million in total liabilities and
$234.35 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/nnDarA
BBX Capital
BBX Capital (NYSE: BBX), formerly known as BankAtlantic Bancorp,is
a diversified investment and asset management company. The
business of BBX Capital includes real estate ownership, direct
acquisition and joint venture equity in real estate, specialty
finance, and the acquisition of controlling and non controlling
investments in operating businesses.
BBX Capital disclosing net income of $235.76 million in 2012, a
net loss of $28.74 million ncome in 2011 and a net loss of $143.25
million in 2010.
* * *
As reported by the TCR on March 1, 2011, Fitch has affirmed its
current Issuer Default Ratings for BankAtlantic Bancorp and its
main subsidiary, BankAtlantic FSB at 'CC'/'C' following the
announcement regarding the regulatory order with the Office of
Thrift Supervision.
BankAtlantic has announced that it has entered into a Cease and
Desist Order with the OTS at both the bank and holding company
level. The regulatory order includes increased regulatory capital
requirements, limits to the size of the balance sheet, no new
commercial real estate lending and improvements to its credit risk
and administration areas. Furthermore, the holding company must
also submit a capital plan to maintain and enhance its capital
position.
BEAZER HOMES: S&P Revises Outlook to Stable & Affirms 'B-' CCR
--------------------------------------------------------------
Standard & Poor's Ratings Services said it revised the outlook on
Atlanta-based homebuilder Beazer Homes USA Inc. (Beazer) to stable
from negative. At the same time, S&P affirmed its 'B-' corporate
credit rating on Beazer and its issue ratings on its debt. The
recovery rating on the company's senior secured notes remains '2',
indicating S&P's expectation for substantial (70%-90%) recovery in
the event of a payment default. The recovery rating on the
company's senior unsecured notes remains '6', indicating S&P's
expectation for negligible (0%-10%) recovery in the event of a
payment default.
"The outlook revision reflects Beazer's improved operating
performance and our expectation that the company will now meet or
exceed our base-case projection for EBITDA in 2013," said Standard
& Poor's credit analyst Matthew Lynam.
Better-than-expected recent results were driven by strong year-
over-year growth in deliveries, average sales price (ASP), and
margin expansion. S&P believes community count expansion
beginning in 2014 will better position the company to sustain
momentum into next year. Current ratings acknowledge the
company's highly leveraged balance sheet and the need for further
operational improvement, offset by adequate liquidity and the lack
of near-term debt maturities.
Standard & Poor's ratings on Beazer reflect the company's "highly
leveraged" financial risk profile, as measured by a heavy debt
load and sizable interest obligations. However, S&P also
acknowledges the company's success in pushing scheduled debt
maturities to 2016 and beyond and boosting its liquidity position.
S&P considers the homebuilder's business risk profile to be
"vulnerable" given the considerable operating improvements
necessary to reach profitability and its larger presence in
relatively weaker Southeast, Northeast, and Midwest markets.
"The stable outlook anticipates further strengthening of EBITDA as
the housing recovery continues such that debt to EBITDA declines
to the 9x-12x range in fiscal year 2014, and the maintenance of an
"adequate" liquidity profile. We would take a negative rating
action if the company's EBITDA growth fails to meet our base-case
expectations in 2014 and liquidity becomes constrained. An
upgrade is unlikely over the next year given the company's high
leverage and weak credit metrics. Longer term, a positive rating
action would require substantial deleveraging and existing cash
balances to be sufficient to fund land investment needed to meet
our expectations for growth," S&P said.
BEBO.COM INC.: Case Summary & 19 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Bebo.com, Inc.
aka Bebo, Inc., Buckaroo Acquisition Corporation
10951 W Pico Boulevard, Suite 204
Los Angeles, CA 90064
Bankruptcy Case No.: 13-22205
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Central District of California (Los Angeles)
Judge: Ernest M. Robles
Debtor's Counsel: William F. Govier, Esq.
LESNICK PRINCE & PAPPAS, LLP
315 W. 9th Street, Suite 705
Los Angeles, CA 90015
Tel: (213) 493-6496
Fax: (213) 493-6596
E-mail: wgovier@lesnickprince.com
- and ?
Matthew A. Lesnick, Esq.
LESNICK PRINCE & PAPPAS, LLP
185 Pier Avenue, Suite 103
Santa Monica, CA 90405
Tel: (310) 396-0964
Fax: (310) 396-0963
E-mail: matt@lesnickprince.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 19 largest unsecured creditors
is available for free at http://bankrupt.com/misc/cacb13-22205.pdf
The petition was signed by Michael Ong, receiver.
BERNARD L. MADOFF: Starts Appeal to Revive $10-Bil. in Suits
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee liquidating Bernard L. Madoff Investment
Securities LLC began an appeal that will determine whether he can
revive about $10 billion in lawsuits, where success could mean
full recovery of the approximately $17 billion customers invested
in the Ponzi scheme.
The report relates that Madoff trustee Irving Picard filed about
1,000 lawsuits to recover so-called fictitious profits that
customers took out of their accounts in six years before
bankruptcy. Because Madoff never bought a single security with
customers' investments, Picard worked from the theory that
everything a customer received by definition was stolen from other
customers.
Under Mr. Picard's theory of bankruptcy law regarding fraudulent
transfers, even a customer with no hint of fraud is liable to
return fictitious profits, or money taken out in excess of cash
invested going back six years before bankruptcy.
The report recounts that U.S. District Judge Jed Rakoff ruled in
April 2012 that the so-called safe harbor in bankruptcy law
prevents Mr. Picard from suing more than two years before
bankruptcy.
With his lawsuits cut back from six years to two, Mr. Picard
appealed and filed his brief last week in the U.S. Court of
Appeals in Manhattan.
Judge Rakoff reasoned that the safe harbor, designed to prevent
traders in securities from being sued in bankruptcy, protects
customers' reasonable expectations, even though there were no
actual securities traded.
In his 78-page brief May 15, Mr. Picard said that Judge Rakoff was
the first judge to apply the safe harbor when there were no
securities traded. To buttress his argument, Mr. Picard referred
to the appeals court's decision in the Madoff case refusing to
recognize the fiction that there were actual securities traded and
ruling that customers' claims were limited to cash invested less
cash taken out. Mr. Picard said that Judge Rakoff "gave legal
effect" to the same fiction the appeals court refused to
recognize. Mr. Picard argues that the safe harbor doesn't apply
by the language of the law itself. He said that "honoring the
expectations of customers who received fictitious profits would
not further the statutory goal" of the safe harbor.
The appeal also asks the circuit court to rule that Judge Rakoff
was wrong when he took hundreds of cases out of bankruptcy court
to rule on the safe harbor. Mr. Picard wants the appeals court to
rule that he can similarly reinstate lawsuits for preferences, or
money taken out within 90 days of bankruptcy.
If Mr. Picard wins, he said last year that he could restore claims
against customers for about $2.6 billion in fictitious profits,
some $7 billion in claims against customers or feeder funds who
had reason to believe there was fraud, and about $160 million in
preferences.
Mr. Picard has already collected about $11 billion, toward
customers' claims of $17 billion, including money forfeited to the
government that will be distributed to customers. Victory on
appeal, success in ensuing lawsuits, and the ability to collect
from customers could bring Mr. Picard near generating enough cash
for full payment on claims.
The outcome of the appeal will be significant for individual
customers. In his brief, Mr. Picard mentions one customer who
received $150 million in fictitious profits within six years of
bankruptcy. Another took home $6 million in six-year fictitious
profits and $44 million in preferences.
The Securities Investor Protection Corp. filed a brief in support
of the trustee. Customers will file their papers in support of
Judge Rakoff's opinion in a month.
The appeal is Picard v. Ida Fishman Revocable Trust (In re
Bernard L. Madoff Investment Securities LLC), 12-2557, Second
U.S. Circuit Court of Appeals (Manhattan).
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.).
Mr. Picard has made three distributions, paying more than half of
smaller claims in full and satisfying just over 50 percent of
larger customer claims totaling more than $17 billion.
BRONX PARKING: Yankee Stadium Parking Lot in Forbearance
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Bronx Parking Development Corp., the operator of
parking garages at rebuilt Yankee Stadium, has until July 15 to
work out an agreement with holders of $240 million in defaulted
bonds to stave off a bankruptcy filing.
Revenue isn't covering debt service because more fans are taking
public transportation to the games than anticipated.
Bronx Parking missed a $6.9 million payment due April 1 on more
than $237 million in tax-exempt bonds arranged by the Bloomberg
administration back in 2007, making it one of the biggest New York
City-sponsored bond defaults in decades.
BROOKLYN NAVY: S&P Retains 'CCC' Rating on Senior Debt
------------------------------------------------------
Standard & Poor's Ratings Services revised its CreditWatch
placement of the ratings on Brooklyn Navy Yard Cogeneration
Partners L.P.'s to positive from developing.
"The revision in CreditWatch reflects improvement in BNYCP's
liquidity position from the timely receipt of insurance proceeds,
positive cash generation from restart of the plant, and
expectations that the new project owner, EIF, will likely bolster
liquidity in the near term," said Standard & Poor's credit analyst
Jatinder Mall.
The rating on BNYCP's senior debt remains at 'CCC' and continues
to reflect S&P's view of its heavy debt burden, weak liquidity
position, and inability to withstand an unanticipated outage at
the plant. The recovery rating remains at '4', indicating S&P's
anticipation of average (30% to 50%) recovery in the event of a
default. The ratings were placed on CreditWatch developing on
Dec. 6, 2012.
BNYCP is a 220 megawatt (MW) to 300 MW gas- and oil-fired
cogeneration facility in Brooklyn, N.Y., which can produce up to 1
million pounds of steam per hour. It has a 40-year power and
steam purchase agreement (energy sales agreement) with
Consolidated Edison Co. of New York Inc. (A-/Stable/A-2),
which expires in 2036. The plant began operations in November
1996.
The plant came back online in January 2013 after experiencing a
forced outage event for close to two months due to hurricane
Sandy. During the forced outage, the project did not generate any
cash flow. Given capital expenditures of around $28 million
related to restoration of the project, uncertainty of the timing
of insurance proceed receipt, and scheduled debt payment,
liquidity has been the project's primary risk in S&P's view.
Since restart, the plant has achieved an availability factor of
more than 98% as of March 2013 and has been generating positive
cash flow. The costs related to restoration of the plant have
been fully paid from a combination of insurance proceeds and cash
on hand. To date, the project has received $20 million in
insurance proceeds with the remainder expected by the third
quarter of this year.
Despite the receipt of insurance proceeds and the generation of
the project of cash flow, liquidity remains constrained due to the
increased debt burden, and S&P views a default to be a possibility
in the next 12 months if the plant incurred any additional
outages. The project's projected debt service coverage ratio is
expected to decline to below 1.0x by the first quarter of 2014,
and S&P expects its cash balances to pay debt obligations to
dwindle. Somewhat mitigating the liquidity risk is the recent
acquisition of the project by EIF. S&P believes that the new
owners have incentives to bolster liquidity.
CAPITOL BANCORP: Files Liquidating Plan, to Sell Remaining Banks
----------------------------------------------------------------
Capitol Bancorp Ltd. and Financial Commerce Corporation proposed a
joint liquidation plan where all of their remaining non-debtor
subsidiary banks will be sold off. The liquidation plan replaces
the prepackaged plan of reorganization the Debtors proposed last
year, according to Maria Chutchian of BankruptcyLaw360.
The Debtors stated in their liquidating plan that they are
presently unable to estimate a recovery for any of the Classes of
Claims and Equity Security Interests of Capitol. The extent of
the recovery, if any, will be dependent on the results of the Sale
Process or Reorganization.
To the extent the Sale Process or Reorganization results in
Proceeds or other value, which the Federal Deposit Insurance
Corporation and other Bank Regulators may, to the extent of their
authority, have the power to restrict and permit the Debtors to
distribute in furtherance of the Plan, the distribution, if any,
will be made upon completion of the Sale Process and liquidation
of any remaining assets of the Debtors' Estates pursuant to the
provisions of the Liquidating Trust.
All classes of claims -- Class 1 ? Senior Note Claims, Class 2 ?
Trust Preferred Securities Claims, Class 3 - Other Priority
Claims, Class 4 - General Unsecured Claims, Class 5 ? Company's
Series A Preferred Stock, Class 6 ? Company's Common Stock, and
Class 7 ? Intercompany Claims for Capital Bancorp, and Class 1 ?
Intercompany Claims and Class 2 ? FCC's Equity Security Interests
for FCC -- are impaired under the Plan.
Sale of Banks
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Capitol Bancorp is trying to sell some of the banks
to stave off regulatory takeovers of the remainder.
The report relates that regulators this month took over three
banks and attempted to take over a fourth. According to a court
filing, Capitol obtained an injunction from state court
prohibiting regulators from taking over.
Along with the plan and proposed disclosure statement, Capitol
filed papers to sell as many banks as buyers are willing to
purchase. Even if some banks are sold, the proceeds can't go to
creditors. Instead, they must be held in trust under a prior
agreement with the Federal Deposit Insurance Corp. and presumably
used to augment capital at sister banks with capital deficiencies.
The holding company said it has been unable to locate an equity
investor willing to sponsor a reorganization plan.
About Capitol Bancorp
Capitol Bancorp Ltd. and Financial Commerce Corporation filed
voluntary Chapter 11 bankruptcy petitions (Bankr. E.D. Mich. Case
Nos. 12-58409 and 12-58406) on Aug. 9, 2012.
Capitol Bancorp -- http://www.capitolbancorp.com/-- is a
community banking company with a network of individual banks and
bank operations in 10 states and total consolidated assets of
roughly $2.0 billion as of June 30, 2012. CBC owns roughly 97% of
FCC, with a number of CBC affiliates owning the remainder. FCC,
in turn, is the holding company for five of the banks in CBC's
network. CBC is registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended, 12 U.S.C. Sec. 1841,
et seq., and trades on the OTCQB under the symbol "CBCR."
Lawyers at Honigman Miller Schwartz and Cohn LLP represent the
Debtors as counsel. John A. Simon, Esq., of Foley & Lardner LLP
represents the Official Committee of Unsecured Creditors as
counsel.
In its petition, Capitol Bancorp scheduled $112,634,112 in total
assets and $195,644,527 in total liabilities. The petitions were
signed by Cristin K. Reid, corporate president.
The Company's balance sheet at Sept. 30, 2012, showed
$1.749 billion in total assets, $1.891 billion in total
liabilities, and a stockholders' deficit of $141.8 million.
Prepetition, the Debtor arranged a reorganization plan that was
accepted by the requisite majorities of creditors and equity
holders in all classes. Problems arose when affiliates of
Valstone Partners LLC declined to proceed with a tentative
agreement to fund the reorganization by paying $50 million for
common and preferred stock while buying $207 million in face
amount of defaulted commercial and residential mortgages.
CAPITOL BANCORP: Incurs $2.5 Million Net Loss in First Quarter
--------------------------------------------------------------
Capitol Bancorp Ltd. filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $2.50 million on $15.74 million of total interest income for
the three months ended March31, 2013, as compared with a net loss
of $8.23 million on $20.83 million of total interest income for
the three months ended March 31, 2012.
The Company's balance sheet at March 31, 2013, showed $1.40
billion in total assets, $1.54 billion in total liabilities and a
$145.54 million total deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/u6XwUG
About Capitol Bancorp
Capitol Bancorp Ltd. and Financial Commerce Corporation filed
voluntary Chapter 11 bankruptcy petitions (Bankr. E.D. Mich. Case
Nos. 12-58409 and 12-58406) on Aug. 9, 2012.
Capitol Bancorp -- http://www.capitolbancorp.com/-- is a
community banking company with a network of individual banks and
bank operations in 10 states and total consolidated assets of
roughly $2.0 billion as of June 30, 2012. CBC owns roughly 97% of
FCC, with a number of CBC affiliates owning the remainder. FCC,
in turn, is the holding company for five of the banks in CBC's
network. CBC is registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended, 12 U.S.C. Sec. 1841,
et seq., and trades on the OTCQB under the symbol "CBCR."
Lawyers at Honigman Miller Schwartz and Cohn LLP represent the
Debtors as counsel. John A. Simon, Esq., of Foley & Lardner LLP
represents the Official Committee of Unsecured Creditors as
counsel.
In its petition, Capitol Bancorp scheduled $112,634,112 in total
assets and $195,644,527 in total liabilities. The petitions were
signed by Cristin K. Reid, corporate president.
Prepetition, the Debtor arranged a reorganization plan that was
accepted by the requisite majorities of creditors and equity
holders in all classes. Problems arose when affiliates of
Valstone Partners LLC declined to proceed with a tentative
agreement to fund the reorganization by paying $50 million for
common and preferred stock while buying $207 million in face
amount of defaulted commercial and residential mortgages.
CHEM RX: McKesson Wins Summary Judgment in Avoidance Suit
---------------------------------------------------------
Bankruptcy Judge Mary F. Walrath granted the Motion of McKesson
Corporation for Summary Judgment on the Complaint filed by AP
Services, LLC, as Trustee of the Litigation Trust established in
the Chapter 11 cases of Chem RX Corporation. The Complaint seeks
to avoid transfers and recover property pursuant to sections 547,
548, 549, and 550 of the Bankruptcy Code and to disallow
McKesson's claim pursuant to section 502(d).
McKesson is a wholesale distributor of pharmaceutical products.
Beginning in 2004, McKesson sold pharmaceutical products to the
Debtors through a computerized and highly automated process that
tracked orders, payments, and shipments. From February 10 through
May 11, 2010, the Debtors made 64 wire transfers to McKesson in an
aggregate amount of not less than $9,874,843.
On February 14, 2013, McKesson filed its Motion for Summary
Judgment on all counts in which it asserts that there are no
triable issues of material fact. In its Response, the Trustee
conceded summary judgment regarding its Count II fraudulent
conveyance claim.
The Court agrees with McKesson that the daily ordering/prepayment
relationship of the parties resulted in payment in advance for all
deliveries. The wire transfer always cleared before the delivery
of McKesson's pharmaceutical product. Therefore, the Transfers
were advance payments and did not satisfy antecedent debt. Thus,
the Court will grant McKesson's Motion for Summary Judgment on
Count I of the Complaint.
The Court also held that the Last Transfer cleared on May 10,
2010, the day before the Petition Date. Therefore, the Last
Transfer does not constitute a post-petition transfer avoidable
pursuant to section 549.
Because the Court grants summary judgment in favor of McKesson on
the Trustee's avoidance claims, the related claims to recover the
value of the Transfers under section 550(a) and to disallow
McKesson's claim under section 502(d) also will be denied. As a
result, the Court will grant McKesson's Motion for Summary
Judgment on all counts of the Trustee's Complaint.
The case is, AP SERVICES, LLC, AS TRUSTEE OF THE CRC LITIGATION
TRUST Plaintiff, v. McKESSON CORPORATION, Defendant, Adv. Proc.
No. 12-50701 (Bankr. D. Del.). A copy of the Court's May 16, 2013
Memorandum Opinion is available at http://is.gd/x91ADAfrom
Leagle.com.
About Chem RX Corp.
Long Beach, N.Y.-based Chem RX Corporation, aka Paramount
Acquisition Corp. -- http://www.chemrx.net/-- was a major
institutional pharmacy serving the New York City metropolitan
area, as well as parts of New Jersey, upstate New York,
Pennsylvania and Florida. The Company and five affiliates sought
Chapter 11 protection (Bankr. D. Del. Case No. 10-11567) on May
11, 2010. Dennis A. Meloro, Esq., and Scott D. Cousins, Esq., at
Greenberg Traurig, LLP, in Delaware, represented the Company in
its restructuring. Cypress Holdings, LLC, served as the Company's
financial advisor. RSR Consulting, LLC, provided a chief
restructuring officer. Brunswick Group LLP served as the
Company's public relations consultant. Grant Thornton LLP served
as the Company's independent auditor. Lazard Middle Market LLC
acted as the Company's investment banker. Eichen & Dimeglio PC
was the Company's tax advisor. Kurtzman Carson Consultants was
the Company's claims and notice agent.
Attorneys at White & Case and Fox Rothschild LLP served as
co-counsel to the Official Committee of Unsecured Creditors
Chanin Capital Partners LLC served as Restructuring and Financial
Advisor for the Official Committee of Unsecured Creditors.
The Company disclosed $169,690,868 in assets and $178,281,128 in
debts as of Feb. 28, 2010.
Chem Rx changed its name to CRC Parent Corp. following the sale of
its business to PharMerica Corp. at a bankruptcy court-sanctioned
auction. PharMerica paid $70.6 million and assumed specified
liabilities. The deal enabled PharMerica to move into the New
York and New Jersey markets.
On April 11, 2011, the Court entered an Order confirming the
Debtors' Second Amended Joint Plan of Liquidation.
CHESAPEAKE ENERGY: Fitch Affirms 'BB+' Issuer Default Rating
------------------------------------------------------------
Fitch Ratings has affirmed the Long-term Issuer Default Rating (LT
IDR) and senior unsecured ratings for Chesapeake Energy
Corporation. In addition, Fitch has affirmed the ratings on the
company's secured credit facility and its preferred stock.
Approximately $16 billion in rated securities is affected by this
rating action. The Rating Outlook has been revised to Stable from
Negative.
Key Rating Drivers
Chesapeake's ratings reflect a very large asset base and
production profile coupled with relatively high adjusted leverage
for a firm its size. The company is second largest natural gas
producer in the U.S., accounting for approximately 4% of total
production, and the 11th largest producer of oil and natural gas
liquids in the U.S. Proved reserves at the end of 2012 totaled 2.6
billion boe and production in first quarter 2013 (1Q'13) was
666,600 boe/d split approximately 76% natural gas, 16% crude oil
and 8% natural gas liquids (NGLs). Total balance sheet debt at the
end of the first quarter was approximately $13.5 billion, which
translated to an LTM unadjusted debt/EBITDA of approximately 3.6x.
While balance sheet debt was approximately $13.5 billion at the
end of March, Fitch makes adjustments, such as adding minority
interests, Volumetric Production Payment obligations, asset
retirement obligations, other long-term obligations, etc. After
these adjustments are made, adjusted debt is approximately $18.8
billion. After preferred stock of $3 billion the figure rises to
over $21 billion. As a result, adjusted debt/Proved Developed was
$11.76/PD at the end of 2012 and adjusted debt/daily production
was approximately $27,000/boe per day. Adjusted debt plus
preferreds/PD was $13.81/PD and adjusted debt plus
preferreds/daily production was approximately $31,700 at the end
of last year.
For 2013, Fitch estimates EBITDA for Chesapeake should rise to
between $4.5 billion-$5 billion, resulting in an unadjusted
debt/EBITDA of near 3x. Given those EBITDA expectations,
Chesapeake should not have difficulty with revised revolver
covenants for 2013 (4.5x for June 30, 2013, 4.25x for Sept.30,
2013 and 4x for Dec. 31, 2013). Fitch's free cash flow (FCF)
expectation for 2013 is that the company will be have a FCF
deficit of approximately $3.5 billion which will be funded with a
minimum of $4 billion in assets sales. This deficit is
significantly smaller than last year's. Expectations for 2014 are
for a somewhat smaller funding gap which will again be funded with
asset sales. These deficits continue near-term as result of the
company's efforts to increase liquids production that have higher
realizations and margins than that of natural gas.
OPERATIONS
Operationally, Chesapeake expects roughly flat production this
year versus 2012. This follows a 19% production increase in 2012
and 15% increase for 2011. Liquids production continues to
increase quarterly and now stands at approximately 24% of total
production compared to less than 10% three years ago. Expectations
are for further single-digit percentage production increases in
2014. In terms of reserve and costs, Chesapeake's three-year
average finding, development and acquisition costs are
approximately $20 per barrel of oil equivalent, which is
competitive within its peer group.
LIQUIDITY
Chesapeake's liquidity comes primarily from its $4 billion secured
credit facility that expires in 2015. As of the end of the first
quarter, the company had slightly over $3.1 billion in available
liquidity on this facility after drawings of $832 million and
letters of credit of $31 million. The company also derives
liquidity from a secured credit facility ($500 million) at its
oilfield services unit that was mostly drawn at quarter-end as
well as from continuing asset sales. Going forward, Fitch expects
that the company will maintain a larger liquidity buffer than it
has historically. The company's next major maturities occur in
2015 when approximately $2.5 billion potentially comes due.
OUTLOOK REVISION
The Outlook revision reflects a stronger natural gas price outlook
for 2013 and 2014 and, as a result, a stronger outlook for cash
flows. Additionally factored into the revision is better available
liquidity, expected completion of at least $4 billion in asset
sales before year-end, and Fitch's expectations of a more
conservative financial strategy given the revamp in the Board of
Directors over course of the last year.
RATING SENSITIVITIES
Positive: Future developments that may, individually or
collectively, lead to positive rating action include:
-- Material progress in deleveraging the balance sheet relative
to reserves and production;
-- Much stronger cash flow generation leading to consistent and
significant positive free cash flow generation.
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
-- Increased debt levels relative to reserves and production;
-- Weak natural gas or crude prices leading to a reduction in
expected cash flow;
-- Marked decrease in production levels or proved developed
reserves relative to debt;
-- Reduction in available liquidity.
Fitch affirms Chesapeake as follows:
-- LT IDR at 'BB-';
-- Unsecured Term Loan at 'BB-';
-- Senior unsecured notes at 'BB-';
-- Senior secured revolving credit facility at 'BBB-';
-- Convertible preferred stock at 'B''.
The Rating Outlook is now Stable.
CHINA NATURAL: Reports $4.6 Million Net Income in First Quarter
---------------------------------------------------------------
China Natural Gas, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income of $4.66 million on $35.49 million of revenue for the
three months ended March 31, 2013, as compared with net income of
$1.94 million on $32.27 million of revenue for the same period
during the prior year.
The Company's balance sheet at March 31, 2013, showed $293.53
million in total assets, $83.18 million in total liabilities and
$210.35 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/meGB9X
Headquartered in Xi'an, Shaanxi Province, P.R.C., China Natural
Gas, Inc., was incorporated in the State of Delaware on March 31,
1999. The Company through its wholly owned subsidiaries and
variable interest entity, Xi';an Xilan Natural Gas Co., Ltd., and
subsidiaries of its VIE, which are located in Hong Kong, Shaanxi
Province, Henan Province and Hubei Province in the People's
Republic of China ("PRC"), engages in sales and distribution of
natural gas and gasoline to commercial, industrial and residential
customers through fueling stations and pipelines, construction of
pipeline networks, installation of natural gas fittings and parts
for end-users, and conversions of gasoline-fueled vehicles to
hybrid (natural gas/gasoline) powered vehicles at 0ptmobile
conversion sites.
On Feb. 8, 2013, an involuntary petition for bankruptcy was filed
against the Company by three of the Company's creditors, Abax
Lotus Ltd., Abax Nai Xin A Ltd., and Lake Street Fund LP (Bankr.
S.D.N.Y. Case No. 13-10419). The Petitioners claimed that they
have debts totaling $42,218,956.88 as a result of the Company's
failure to make payments on the 5% Guaranteed Senior Notes issued
in 2008. The Company says it intends to oppose the motion.
Adam P. Strochak, Esq., at Weil, Gotshal & Manges, LLP, in
Washington, D.C., represents the Petitioners as counsel.
CLEAN BURN FUELS: Ch.7 Trustee May Avoid Perdue Unperfected Lien
----------------------------------------------------------------
In the case, CLEAN BURN FUELS, LLC, Plaintiff, v. PURDUE
BIOENERGY, LLC, Defendant, Adv. Proc. No. 11-09046 (Bankr.
M.D.N.C.), Bankruptcy Judge Thomas W. Waldrep, Jr., ruled on cross
motions for partial summary judgment filed on January 24, 2013,
one filed by the Chapter 7 trustee for Clean Burn Fuels, LLC, and
the other filed by Perdue BioEnergy, LLC.
In November 2009, Clean Burn Fuels and Perdue BioEnergy entered
into a series of agreements regarding the supply and delivery of
corn to the Debtor's ethanol plant. Perdue supplied corn to the
plant until the plant closed in early 2011. Thereafter, the
Debtor filed a Chapter 11 bankruptcy petition and initiated the
adversary proceeding, which seeks a declaratory judgment that the
corn being housed in the bins at the Debtor's plant was property
of the estate. The case was converted to Chapter 7 in 2012, and
Sara A. Conti, Chapter 7 trustee was substituted for the Debtor in
the adversary proceeding.
The Trustee Motion contends that even though the contracts between
the Debtor and Perdue provide that Perdue is the owner of the
Corn, because the Corn was delivered to the Debtor, the Uniform
Commercial Code limits Perdue to the retention of a security
interest in the Corn. Furthermore, because Perdue did not perfect
a security interest in the Corn, its interest is avoidable
pursuant to 11 U.S.C. Section 544. The Perdue Motion asserts that
delivery to the Debtor did not occur until the Corn was removed
from the bins and crossed a weighbelt. Therefore, because the Corn
remained in the bins, Perdue retained possession and ownership of
the Corn. Perdue also seeks summary judgment on the Trustee's
breach of contract claim, asserting that it had a right to setoff
that cannot be avoided by the Trustee.
In a May 16, 2013 Memorandum Opinion available at
http://is.gd/QH3tW4from Leagle.com, Judge Waldrep concludes that
the Corn is property of the estate, Perdue holds an unperfected
security interest in the Corn and its proceeds, and the Trustee
may avoid Perdue's unperfected security interest pursuant to
Section 544(a) of the Bankruptcy Code. As to Perdue's right of
setoff, the Court concludes that there are material facts in
controversy. Thus, the Trustee Motion will be granted and the
Perdue Motion denied.
About Clean Burn Fuels
Founded in 2005, Clean Burn Fuels LLC was the first company to
produce ethanol in North Carolina. It completed the construction
of its ethanol plant in Raeford, North Carolina, in August 2010
and started producing and selling ethanol and dried distillers
grains with solubles (DDGS) shortly thereafter.
Clean Burn filed for Chapter 11 bankruptcy protection (Bankr.
M.D.N.C. Case No. 11-80562) on April 3, 2011. John A. Northen,
Esq., at Northen Blue, L.L.P., in Chapel Hill, N.C., represented
the Debtor. Anderson Bauman Tourtellot Vos & Co. served as
financial consultant and chief restructuring officer. Smith,
Anderson, Blount, Dorsett, Mitchell & Jernigan, LLP served as
special counsel to assist the Debtor in its state court litigation
matters, including various lawsuits pending in Hoke County, North
Carolina. The Debtor disclosed $79,516,062 in assets and
$79,218,681 in liabilities as of the Chapter 11 filing.
The Debtor lost its assets when the bankruptcy court in Durham,
North Carolina permitted foreclosure in July 2011. The
foreclosing lender was Cape Fear Farm Credit ACA, owed $66
million. In January 2012, the bankruptcy court appointed a
Chapter 11 trustee.
Sara A. Conti, Chapter 11 trustee for the Debtor, tapped Northen
Blue as special counsel. Charles M. Ivey, Esq., at Ivey McClellan
Gatton, in Greensboro, N.C., represented the Creditors' Committee
as counsel.
In September 2012, the case was converted to Chapter 7 and Ms.
Conti was named Chapter 7 trustee.
CLEAR CHANNEL: Moody's Keeps 'Caa2' CFR Over Upsized Loan
---------------------------------------------------------
Moody's Investors Service said that Clear Channel Communications,
Inc.'s upsize of the term loan D to $4 billion from $1.5 billion
will not impact the Caa1 facility rating assigned. Clear Channel's
Corporate Family Rating is unchanged at Caa2. The outlook remains
Stable.
The upsize of the term loan D to $4 billion will be issued in
exchange for term loan B &C's and would reduce the amount of bank
loans that mature in January 2016 to $4.2 billion from $8.2
billion. $1.6 billion of cash pay and toggle notes mature in
August 2016 and an additional $250 million of legacy notes mature
in December 2016. The maturity of the term loan D will be extended
out to January 2019 instead of July 2018 as originally proposed.
The security package and guarantee package is expected to be
identical to the existing term loans, but there would be no
amortization required on the term loan D and any paydowns would be
applied first to the 2016 bank loan facilities.
While the amendment and extend offer substantially reduces Clear
Channel's 2016 maturity wall, it does come at a price as debt with
an interest rate spread of L+3.65 is exchanged for debt with a
L+6.75 spread. Annual interest expenses would increase by $124
million compared to approximately $35 million from the amendment
as originally proposed. Moody's anticipates free cash flow is
likely to be only slightly positive (less than 0.2% free cash flow
to total debt) at the end of 2013 before turning modestly negative
in 2014 as the full year impact of higher interest rates takes
effect.
Extending debt maturities at materially higher interest rates may
only be exchanging the risk of a default at maturity for a payment
default if the economy enters another economic downturn. However,
it does provide the company additional time to improve results and
look for future opportunities to delever the balance sheet and
potentially offset the impact of higher interest expense. It may
also provide the company with the opportunity to extend the
maturity of debt that is subordinate to the bank debt in the
capital structure. Clear Channel's radio and outdoor business have
always been heavily influenced by the economy, but higher interest
expense make the company especially sensitive to an economic
recession in the future if EBITDA levels decline which has the
potential to cause a liquidity event.
CLEAR CHANNEL: S&P Keeps 'CCC+' Secured Debt Rating on Loan Upsize
------------------------------------------------------------------
Standard & Poor's Ratings Services announced that its issue-level
rating on San Antonio, Texas-based Clear Channel Communications
Inc.'s senior secured term loan remains unchanged at 'CCC+'
following the company's upsize of the loan to $4 billion from
$1.5 billion. The recovery rating on the debt also remains
unchanged, at '4', indicating S&P's expectation for average (30%
to 50%) recovery in the event of a payment default. The $4
billion term loan will mature in January 2019. The proposed
transaction lowers 2016 maturities to about $6 billion.
The rating on parent company CC Media Holdings Inc. remains at
'CCC+' with a negative outlook, which reflects the risks
surrounding the long-term viability of the company's capital
structure. Leverage remains extremely high, at 11.8x, as of
March 31, 2013, but is unchanged by the transaction.
As result of higher interest expense on the new term loan, S&P now
expects that discretionary cash flow will likely turn negative in
2013, which could make it difficult for the company to address
2014 maturities of about $461 million. S&P expects that EBITDA
coverage of interest will remain in the very low-1x area in 2013.
S&P still views a significant increase in the average cost of debt
or deterioration in operating performance--whether for cyclical,
structural, or competitive reasons--as major risks as CC Media
deals with its 2016 maturities. In addition, S&P believes CC
Media may need additional equity to succeed with the refinancing.
RATINGS LIST
CC Media Holdings Inc.
Corporate Credit Rating CCC+/Negative/--
Ratings Unchanged
Clear Channel Communications Inc.
Senior Secured
$4B term loan D* CCC+
Recovery Rating 4
* After upsize from $1.5 billion.
CRESTWOOD HOLDINGS: Moody's Rates New $365MM Term Loan 'Caa1'
-------------------------------------------------------------
Moody's Investors Service assigned a Caa1 rating to the proposed
$365 million secured term loan due 2019 of Crestwood Holdings,
LLC. Concurrently, Moody's placed the new debt under review for
upgrade with the expectation that the term loan and Crestwood's B2
Corporate Family Rating will be rated up to two notches higher
following successful completion of certain initial steps outlined
in the announcement of a merger between Crestwood and Crestwood
Midstream Partners, LP (CMLP), and Inergy LP (NRGY) and Inergy
Midstream LP (NRGM; collectively with NRGY, Inergy).
Crestwood's B2 CFR and CMLP's B3 senior unsecured rating remain
under review for upgrade. Proceeds from the new term loan, along
with cash on hand, will be used to refinance Crestwood's current
term loan and for the purchase of NRGY's general partner (GP)
interests.
Rating Rationale:
Crestwood's proposed term loan is rated the same as the current
term loan, which will be withdrawn once it is repaid using the
proceeds from the proposed term loan. Based on their ultimate
position in the new capital structure in the merged entity, CMLP's
notes also could be upgraded by one or two notches.
As outlined, Crestwood will acquire the GP interests of NRGY and
will contribute the GP and incentive distribution rights of CMLP
to NRGY in exchange for NRGY limited partner units. These steps
expected to be completed by June 2013 will precede the acquisition
of CMLP and assumption of its debt by NRGM. The merger transaction
is expected to close by September 2013.
The review for upgrade on Crestwood's proposed secured term loan
and CFR reflects the likely benefit of the proposed merger with
Inergy. Crestwood would be reliant on cash distributions from NRGY
and NRGM for the units it would hold to service its debt. The
proposed transaction is credit positive for Crestwood since the
combined company (which Crestwood would control) will be larger,
more diversified, and likely a better capitalized company with
stronger credit metrics. The pro forma consolidated business
profile and credit metrics should be stronger than Crestwood on a
standalone basis. However, Crestwood's debt will be structurally
subordinated to the debt at CMLP, NRGM and NRGY, and therefore the
new term loan is likely to be rated two notches below the expected
CFR.
The principal methodology used in this rating was Global Midstream
Energy published in December 2010. Other methodologies used
include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.
Crestwood Holdings LLC is a private holding company owned
primarily by First Reserve Corporation. The company controls and
owns a majority ownership interest in Crestwood Midstream Partners
LP, a publicly traded midstream master limited partnership that
provides natural gas gathering and processing services.
CS PROPERTY: Case Summary & 2 Unsecured Creditors
-------------------------------------------------
Debtor: CS Property, Inc.
dba Pioneer Motel
301 Maple Ave West, Ste 620
Vienna, VA 22180
Bankruptcy Case No.: 13-12179
Chapter 11 Petition Date: May 10, 2013
Court: United States Bankruptcy Court
Eastern District of Virginia (Alexandria)
Judge: Robert G. Mayer
Debtor's Counsel: Hyunkweon Ryu, Esq.
RYU & RYU, PLC
301 Maple Ave. West. Ste 620
Vienna, VA 22180
Tel: (703) 319-0001
E-mail: mikeryu@ryulawgroup.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
The list of 20 largest unsecured creditors contains only two
entries. A copy of the document filed together with the petition
is available for free at http://bankrupt.com/misc/vaeb13-12179.pdf
The petition was signed by Stacey Kim, president.
CUMULUS MEDIA: Stockholders Elect Seven Directors
-------------------------------------------------
The 2013 annual meeting of stockholders of Cumulus Media Inc. was
held on May 10, 2013, at which seven directors were elected to the
Board, namely:
(1) Lewis W. Dickey, Jr.;
(2) Ralph B. Everett;
(3) Alexis Glick;
(4) Jeffrey A. Marcus;
(5) Arthur J. Reimers;
(6) Robert H. Sheridan, III; and
(7) David M. Tolley.
The stockholders ratified the appointment of
PricewaterhouseCoopers LLP as the Company's independent registered
public accounting firm for 2013. An advisory vote on executive
compensation was approved. The stockholders also approved a
holding of an advisory vote on executive compensation every year.
About Cumulus Media
Founded in 1998, Atlanta, Georgia-based Cumulus Media Inc.
(NASDAQ: CMLS) -- http://www.cumulus.com/-- is the second largest
operator of radio stations, currently serving 110 metro markets
with more than 525 stations. In the third quarter of 2011,
Cumulus Media purchased Citadel Broadcasting, adding more than 200
stations and increasing its reach in 7 of the Top 10 US metros.
Cumulus also acquired the Citadel/ABC Radio Network, which serves
4,000+ radio stations and 121 million listeners, in the
transaction
Cumulus Media said in its annual report for the year ended
Dec. 31, 2011, that lenders under the 2011 Credit Facilities have
taken security interests in substantially all of the Company's
consolidated assets, and the Company has pledged the stock of
certain of its subsidiaries to secure the debt under the 2011
Credit Facilities. If the lenders accelerate the repayment of
borrowings, the Company may be forced to liquidate certain assets
to repay all or part of such borrowings, and the Company cannot
assure that sufficient assets will remain after it has paid all of
the borrowings under those 2011 Credit Facilities. If the Company
was unable to repay those amounts, the lenders could proceed
against the collateral granted to them to secure that indebtedness
and the Company could be forced into bankruptcy or liquidation.
Cumulus Media put AR Broadcasting Holdings Inc. and three other
units to Chapter 11 protection (Bankr. D. Del. Lead Case No.
11-13674) in 2011 after struggling to pay off debts that topped
$97 million as of June 30, 2011. Holdings estimated debts between
$50 million and $100 million but said assets are worth less than
$50 million. AR Broadcasting operated radio stations in Missouri
and Texas.
The Company's balance sheet at March 31, 2013, showed $3.71
billion in total assets, $3.40 billion in total liabilities,
$72.36 million in total redeemable preferred stock, and $236.56
million in total stockholders' equity.
* * *
Standard & Poor's Ratings Services in October 2011 affirmed is 'B'
corporate credit rating on Cumulus Media.
"The ratings reflect continued economic weakness and higher post-
acquisition leverage than we initially expected," said Standard &
Poor's credit analyst Jeanne Shoesmith. "They also reflect the
combined company's sizable presence in both large and midsize
markets throughout the U.S."
As reported by the TCR on Nov. 20, 2012, Moody's Investors Service
affirmed the B1 Corporate Family Rating of Cumulus Media. The
company's B1 corporate family rating is forward looking and
reflects Moody's expectation that management will continue to
reduce debt balances with free cash flow resulting in net debt-to-
EBITDA ratios of less than 6.0x (including Moody's standard
adjustments, and treating preferred shares as 75% debt) over the
rating horizon, with further improvement thereafter consistent
with management's 4.0x reported leverage target.
As reported by the TCR on April 3, 2013, Moody's Investors Service
downgraded Cumulus Media, Inc.'s Corporate Family Rating to B2
from B1 and Probability of Default Rating to B2-PD from B1-PD.
The downgrades reflect Moody's view that the pace of debt
repayment and delevering will be slower than expected. Although
EBITDA for 4Q2012 reflects growth over the same period in the
prior year, results fell short of Moody's expectations.
D & M ROLNICK: Case Summary & 2 Unsecured Creditors
---------------------------------------------------
Debtor: D & M Rolnick Enterprises LLC
10 Maple Street
Port Washington, NY 11050
Bankruptcy Case No.: 13-72495
Chapter 11 Petition Date: May 10, 2013
Court: United States Bankruptcy Court
Eastern District of New York (Central Islip)
Judge: Dorothy Eisenberg
Debtor's Counsel: Gerard R. Luckman, Esq.
SILVERMANACAMPORA LLP
100 Jericho Quadrangle Ste 300
Jericho, NY 11753
Tel: (516) 479-6300
E-mail: efilings@spallp.com
Scheduled Assets: $3,002,800
Scheduled Liabilities: $891,086
A copy of the Company's list of its top unsecured creditors, filed
together with the petition, is available for free at
http://bankrupt.com/misc/nyeb13-72495.pdf
The petition was signed by Danny Rolnick, member.
DCP MIDSTREAM: S&P Rates New Jr. Sub. Unsecured Notes Due 2043 BB+
------------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'BB+'
issue-level rating to U.S. midstream energy company DCP Midstream
LLC's proposed junior subordinated unsecured notes offering due
2043. DCP Midstream intends to use the net proceeds to repay
outstanding commercial paper and for general partnership purposes.
The subordinated notes will receive "intermediate" (50%) equity
credit under S&P's hybrid criteria for financial ratio analysis.
As of March 31, 2013, DCP Midstream had $5.49 billion in
consolidated balance-sheet debt.
Denver-based DCP Midstream is one of the largest natural gas
gatherers, processors, and marketers, and the largest natural gas
liquids producer, in the U.S. S&P rates the company, a joint
venture owned equally between Spectra Energy Corp. and Phillips
66, 'BBB' and the outlook is negative.
RATINGS LIST
DCP Midstream LLC
Corp. credit rating BBB/Negative/--
New Rating
Junior subordinated unsecured notes due 2043 BB+
DDR CORP: S&P Retains 'BB+' Corporate Credit Rating
---------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BBB-' issue-level
rating to DDR Corp.'s proposed $300 million 10-year senior
unsecured notes. S&P also assigned a '2' recovery rating to the
notes indicating its expectation for substantial (70%-90%)
recovery in the event of a payment default.
The notes will be used to fund the $1.46 billion acquisition of
Blackstone's 95% interest in 30 of the 44 assets held in the
Blackstone/DDR joint venture. The proposed funding is roughly
leverage-neutral (nearly 45% debt-55% equity), with $675 million
of new common equity, $146 million of DDR preferred equity and
prior mezzanine loan repayments, $398 million of assumed mortgaged
debt (four-year weighted average duration), and $300 million of
new 10-year senior unsecured notes. Credit metrics are flat to
modestly stronger on a pro forma basis upon closing. Near-term
credit metrics will be modestly weaker due to the timing of new
senior unsecured debt funding prior to the Oct. 1, 2013 scheduled
closing of the acquisition.
The transaction will improve the company's exposure to major
markets (50% of portfolio net operating income (NOI) comes from
the top 20 metropolitan statistical areas) and allows DDR to
acquire assets it is very familiar with in an off-market deal. Of
the 30 properties, 21 will be unencumbered, increasing the overall
size of DDR's unencumbered portfolio while the percentage of total
NOI from its unencumbered assets remains roughly unchanged at
approximately two-thirds. DDR will retain its 5% common equity
interest and $40 million preferred equity investment in the 14
assets remaining in the Blackstone/DDR joint venture.
The stable outlook signifies S&P's expectation for continued
improvement in the company's operating performance and modest
balance sheet deleveraging over the next 12 months. S&P expects
Standard & Poor's-calculated fixed-charge coverage (FCC) to
approach 2.0x by year-end 2013. S&P expects Standard & Poor's-
calculated debt to EBITDA (which includes preferred shares and
does not net cash) to continue to tick down over the next year to
the mid-8x range.
S&P would consider raising its corporate credit rating if DDR's
credit metrics approached those of investment-grade peers, such
that Standard & Poor's-calculated FCC strengthens to 2.1x, the
company continues to adequately cover the common dividend, and
Standard & Poor's-calculated debt to EBITDA falls to the mid-7x
area. Per S&P's criteria, it would not raise its debt issue-level
ratings (including the senior unsecured rating) after a one-notch
upgrade of the company, as S&P neither perform a recovery analysis
of nor notch up issue-level ratings on investment-grade companies.
Although S&P presently believes it is unlikely in the near term,
it would consider lowering the corporate credit rating if leverage
or liquidity materially weakened.
RATINGS LIST
DDR Corp.
Corporate Credit Rating BB+/Stable/--
New Rating
$300 mil. 10-year notes
Senior Unsecured BBB-
Recovery Rating 2
DELTA OIL: Incurs $155K Net Loss in First Quarter
-------------------------------------------------
Delta Oil & Gas, Inc., filed its quarterly report on Form 10-Q,
reporting a net loss of $155,102 on $146,711 of revenue for the
three months ended March 31, 2013, compared with a net loss of
$104,253 on $126,718 of revenue for the same period last year.
The Company's balance sheet at March 31, 2013, showed $1.7 million
in total assets, $94,202 in total liabilities, and stockholders'
equity of $1.6 million.
The Company has incurred a net loss of $6.1 million since
inception.
A copy of the Form 10-Q is available at http://is.gd/lIfr6T
Headquartered in Vancouver, Canada, Delta Oil & Gas, Inc., was
incorporated under the laws of the State of Colorado on Jan. 9,
2001. The Company is engaged in the acquisition, development and
production of oil and natural gas properties in North America.
The Company's current focus is on the exploration of its Core land
portfolio comprised of working interests in acreage in Eastern
Texas, King City, California and the Lonestar Prospect in Colusa
County, California.
* * *
As reported in the TCR on April 15, 2013, Excelsis Accounting
Group, in Reno, Nev., expressed substantial doubt about Delta
Oil's ability to continue as a going concern, citing the Company's
recurring losses from operations.
DEX MEDIA: S&P Assigns 'B-' CCR & Rates 4 New Secured Loans 'CCC+'
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned U.S. marketing
solutions provider Dex Media Inc. a long-term corporate credit
rating of 'B-'. The outlook is negative.
At the same time, S&P assigned the company's four new senior
secured term loans due 2016 an issue-level rating of 'CCC+', with
a recovery rating of '5', indicating S&P's expectation for modest
(10%-30%) recovery for lenders in the event of a payment default.
Each of the following issued one of the four new term loans: Dex
Media East Inc., Dex Media West Inc., SuperMedia Inc., and R.H.
Donnelley Inc.
In addition, S&P assigned Dex Media Inc.'s subordinated notes due
2017 an issue-level rating of 'CCC', with a recovery rating of
'6', indicating S&P's expectation for negligible (0%-10%) recovery
for lenders in the event of a payment default.
S&P's rating on Dex Media Inc. reflects its assessment of the
company's business risk profile as "vulnerable."
Dex Media's yellow pages directory segment faces steady structural
declines as advertisers and advertising spending migrates to the
Internet. The company will need to continually and aggressively
manage its cost structure to maintain segment profitability while
facing mid-teen percentage annual revenue decline (based on S&P's
expectations). S&P views the financial profile as "highly
leveraged" based on adjusted debt to EBITDA as of March 31, 2013,
of 3.4x, and the potential for rapid decline in revenue and
EBITDA. We assess Dex Media's management and governance as "fair."
Dex Media has a large national presence in the U.S. print and
online advertising marketplace through its yellow pages print
directories and online and mobile local-search and marketing
solutions. In 2012 Dex Media, pro forma for the SuperMedia Inc.
merger, held a leading market position in the yellow pages print
directories category. The consolidated entity generated about
$2.2 billion in revenue from its U.S. yellow pages print and about
$500 million in revenue from its digital business.
In recent years, revenue has declined at a low- to high-teens
annual percentage rate, and S&P expects revenue to continue its
downward spiral with the shift of advertising spending to digital
and mobile advertising. S&P also expects steady EBITDA margin
erosion from the low-40% area to the mid-30% range over the next
few years as the company struggles to reduce cost in line with
revenue declines, and as ad dollars shift away from higher-margin
print advertising toward lower-margin bundled digital offerings.
DOLE FOOD: S&P Retains B CCR After Upsized Credit Facilities
------------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings and
outlook on Westlake Village, Calif.-based Dole Food Co. Inc.
(B/Stable/--) are unchanged following the recent amendment of the
company's credit agreement, which included a $30 million increase
of the revolving credit facility commitment (to $180 million) and
a $50 million increase of the term loan B (which, including the
original $125 million delayed draw term loan, now totals
$675 million). The issue-level rating on the revised credit
facilities remains 'B+', one notch higher than the 'B' corporate
credit rating. The recovery rating on these facilities remains
'2', indicating S&P's expectation for substantial (70% to 90%)
recovery for senior secured lenders in the event of a payment
default. The outlook remains stable.
The ratings on Dole reflects S&P's view of the company's "highly
leveraged" financial risk profile and "weak" business risk
profile. Following the recent divestiture of Dole's worldwide
packaged food and Asia fresh produce businesses, and associated
debt repayment and refinancing transactions, S&P estimates Dole's
ratio of lease- and pension-adjusted total debt to EBITDA remains
within S&P's "highly leveraged" indicative ratio range of greater
than 5x. From a leverage perspective, the company's reduction in
debt levels is largely offset by the loss of earnings from its
sold operations. Given S&P's expectation of continued softness in
fresh fruit segment earnings during 2013, it projects leverage to
increase to closer to 6x by the end of the year.
S&P believes the divestiture of the Dole Asia businesses weakens
Dole's business risk profile as it reduces Dole's product
diversity and profitability, with the surviving commodity-like
produce business being characterized by more-volatile earnings.
Other key credit factors in S&P's assessment of Dole's business
risk profile include the company's participation in the
competitive, commodity-oriented, seasonal, and volatile fresh
produce industry, which is subject to political and economic
risks. S&P also considers the benefits of Dole's strong market
positions; good geographical, product, and customer
diversification (albeit diminished as a result of the completed
divestiture); and its well-recognized brand name.
RATINGS LIST
Dole Food Co. Inc.
Corporate credit rating B/Stable/--
Ratings Unchanged
Dole Food Co. Inc.
Senior secured B+
Recovery rating 2
DOUGLAS DYNAMICS: Moody's Affirms 'B1' Corp. Family Rating
----------------------------------------------------------
Moody's Investors Service assigned an SGL-3 Speculative Grade
Liquidity Rating to snow plow manufacturer Douglas Dynamics L.L.C,
indicating adequate liquidity to support operations in the near-
term. Moody's also affirmed the company's existing long-term
credit ratings, including the B1 Corporate Family Rating and B1
senior secured ratings. The rating outlook is stable.
"Douglas Dynamics is still recovering from the mild winter of
2011-2012, one of the weakest snow seasons in its markets quite
some time, but we expect the company will maintain an adequate
liquidity cushion at the seasonal tight point in the third quarter
despite drawing down the revolver recently to fund a strategic
acquisition," said Ben Nelson, Moody's lead analyst for Douglas
Dynamics L.L.C.
Issuer: Douglas Dynamics, L.L.C.
Corporate Family Rating, Affirmed B1
Probability of Default Rating, Affirmed B1-PD
Senior Secured Term Loan due 2018, Affirmed B1 (LGD3 47% from 48%)
Speculative Grade Liquidity Rating, Assigned SGL-3
Outlook, Stable
The affirmation of the long-term credit ratings reflects Moody's
view that recent deterioration in credit measures and dividend
payments in excess of free cash flow stem largely from the impact
of extremely unfavorable weather trends during the winter of 2011-
2012. Demand for snowplows and related products tends to correlate
to winter weather and frequency of significant snowfalls, with
some additional variation related to new truck sales and
availability of financing for customers. Credit measures weakened
substantially with leverage in excess of 4 times and negative free
cash flow for the twelve months ended December 31, 2012, and
improved only modestly with better year-over-year quarter
performance in the first quarter of 2013. After another mild
start, strong late season snow in key markets brought the full
year back towards an average snowfall year. These factors,
combined with an adequate liquidity position, help offset concerns
related to a temporary deterioration in credit measures outside of
the expected range in 2012. Moody's believes that operating
results will show modest improvement in 2013 and that normalized
credit measures remain appropriate for the B1 rating level.
The assignment of the SGL-3 rating reflects adequate liquidity to
support operations over the next four quarters. Moody's expects
the company will generate positive free cash flow on an annual
basis and maintain at least $20-30 million of collateral cushion
at the seasonal tight point in the third quarter. Douglas reported
$11 million of cash and an undrawn $80 million asset-based
revolving credit facility at March 31, 2013. Moody's expects that
liquidity will narrow in the second and third quarters due to
normal seasonal working capital trends as builds inventory for the
winter selling season and the acquisition of salt spreader company
TrynEx for $29 million. Moody's expects a significant unwind of
working capital in the fourth quarter will result in positive free
cash flow in 2013.
Ratings Rationale:
The B1 CFR reflects the company's strong market position in snow
and ice control equipment, extensive distribution network,
variable cost structure, demonstrated ability to generate cash
flow through business cycles, and adequate liquidity position. The
rating is constrained primarily by small scale, unpredictable
weather-dependent demand, and shareholder-friendly financial
policies.
The stable outlook assumes the company will maintain adequate
liquidity and take the measures necessary to maintain reasonable
credit metrics if late season snowfall in early 2013 does not
translate into improved order activity heading into the next
winter season. Moody's could downgrade the rating if leverage is
expected to remain above 4 times or free cash flow does not
improve beyond 2013, or if available liquidity falls below Moody's
expectations. Continued dividends in excess of free cash flow
could also have negative rating implications. The company's small
scale, weather-dependent seasonal demand, and stated dividend
policy limit upward rating momentum.
The principal methodology used in this rating was the Global
Automotive Supplier Industry published in January 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Douglas Dynamics L.L.C. designs, manufactures, sells, and supports
snow and ice control equipment for light trucks. Headquartered in
Milwaukee, Wisconsin, the company generated approximately $146
million of revenue for the twelve months ended March 31, 2013.
DOWNSTREAM DEVELOPMENT: S&P Revises Ratings Outlook to Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its rating outlook on
Quapaw, Okla.-based casino operator Downstream Development
Authority to negative from stable. At the same time, S&P affirmed
all ratings, including its 'B' issuer credit rating.
"The outlook revision to negative reflects our expectation that
EBITDA coverage of fixed charges will decline close to 1x over the
next few quarters," said Standard & Poor's credit analyst Ariel
Silverberg.
Notwithstanding a high-single-digit percent increase in revenue in
the first half of fiscal-year 2013 (the fiscal year ends
Sept. 30), Downstream's EBITDA declined in the low-teens percent
area largely from incremental expenses associated with the
December 2012 opening of a new hotel tower, as well as increased
expenses related to its food and beverage offerings. Although
Downstream has already taken steps to better align its cost
structure with demand, S&P expects that, at least through the
remainder of the fiscal year, EBITDA will decline to a level that
will just cover fixed charges. S&P expects fixed charges
(including interest expense, capital spending, tribal
distributions, and debt amortization payments) to be $57 million
in the 12 months ended March 2014. Partly offsetting thin
coverage, S&P expects Downstream will retain good excess cash
balances, which it believes support its near-term liquidity
position.
In addition, S&P expects a near-term covenant violation under
Downstream's furniture, fixtures, and equipment (FF&E) loan and
its term loan. Downstream's FF&E and term loan represent a
relatively small amount (about 11%) of its total debt, and in the
absence of an acceleration event, S&P expects Downstream would
likely be able to liquidate outstanding balances over the
intermediate term. As a result, S&P believes Downstream is likely
to receive a waiver and amendment for the expected covenant
violations and that any increase in interest expense as a result
of a potential amendment would not meaningfully further impair
fixed charge coverage. Nevertheless, in the event S&P believes
lenders would not be amenable to waiving and amending covenants,
S&P could consider lowering the ratings.
The negative outlook reflects S&P's expectation for EBITDA
coverage of fixed charges to decline to close to 1x in the next
few quarters, a level that is weak for the current rating. S&P
could consider lowering the ratings if, in the next few quarters,
EBITDA declines more than it currently expects, resulting in fixed
charge coverage falling below 1x. S&P could also consider
lowering the ratings if it believes lenders would not be amenable
to a waiver and amendment for the expected covenant violations and
if it believed this would result in an acceleration of debt
repayment.
S&P could consider revising the rating outlook to stable if the
current EBITDA decline abates and it believes the company can
sustain EBITDA at a level to comfortably cover fixed charges with
at least a 5% cushion.
DYNAVOX INC: Posts $6.6MM Net Loss in 3Q FY 2013; In Debt Default
-----------------------------------------------------------------
DynaVox on May 17 reported results for the third quarter ended
March 29, 2013.
Results for the Thirteen Weeks Ended March 29, 2013
Net sales were $14.9 million, a decrease of 38%, compared to net
sales of $24.0 million for the third quarter ended March 30, 2012.
Sales for the Company's speech generating devices decreased 39% to
$12.5 million and sales from its special education software
declined 28% to $2.4 million from the prior year.
Gross profit for the third quarter of fiscal year 2013 decreased
40% to $10.4 million, compared to gross profit of $17.4 million in
the third quarter of the prior fiscal year. The Company's gross
margin for the third quarter decreased 230 basis points to 70.0%,
compared to a gross margin of 72.3% in the third quarter of the
prior fiscal year. The decrease in margin is mainly the result of
lower sales volume in both devices and special education software
and changes within the mix of product sales.
Operating expenses, excluding impairment losses, in the third
quarter of fiscal year 2013 decreased 18% to $11.4 million,
compared to $13.9 million in the prior fiscal year. Operating
income (loss), excluding impairment charges, for the third quarter
was $(0.9) million, compared to $3.5 million in the same period a
year ago. An impairment charge of $2.0 million was recorded in
the third quarter of fiscal year 2013 of which $1.9 million
related to indefinite-lived intangible assets and $0.1 million
related to the abandonment of certain leasehold improvements.
Operating expenses in the third quarter of fiscal year 2012
included impairment charges of $62.1 million related to goodwill
and other intangible assets.
GAAP net loss for the third quarter of fiscal year 2013 was $(6.6)
million, or $(0.58) per share, compared to GAAP net loss of
$(14.1) million, or $(1.33) per share, for the same quarter a year
ago. GAAP net loss for the third quarter of fiscal year 2013
reflects other income of $43.9 million for a change in estimate
relating to amounts payable to related parties pursuant to a tax
receivable agreement and income tax expense of $49.4 million
related to a substantial valuation allowance on deferred tax
assets.
Adjusted pro forma net income (loss), as defined below, was $(1.2)
million, or $(0.04) per share, compared to adjusted pro forma net
income of $1.8 million, or $0.06 per share, in the prior fiscal
year.
Adjusted EBITDA, as defined below, decreased 87% to $0.6 million,
compared to $5.0 million in the previous fiscal year.
Results for the Thirty-Nine Weeks Ended March 29, 2013
For the first thirty-nine weeks of fiscal 2013, net sales
decreased 30% to $51.1 million from $73.4 million in the same
period last fiscal year.
Gross profit for the first thirty-nine weeks of fiscal 2013
decreased 31% to $36.7 million. The Company's gross profit margin
decreased 50 basis points to 71.7% from 72.2% in the same period
last fiscal year.
Operating income, excluding impairment losses of, for the first
thirty-nine weeks of fiscal year 2013 decreased 92% to $0.7
million, compared to operating income of $8.7 million in the prior
fiscal year. Operating expenses in the first thirty-nine weeks of
fiscal year 2013 included an impairment charge of $2.0 million of
which $1.9 million related to indefinite-lived intangible assets
and $0.1 million related to the abandonment of certain leasehold
improvements. Operating expenses in the first thirty-nine weeks
of fiscal year 2012 included impairment charges of $62.1 million
related to goodwill and other intangible assets.
GAAP net loss for the first thirty-nine weeks of fiscal year 2013
was $(6.7) million, or $(0.60) per share, compared to GAAP net
loss of $(13.3) million, or $(1.29) per share, a year ago. GAAP
net loss for the first thirty-nine weeks of fiscal year 2013
reflects other income of $43.9 million for a change in estimate
relating to amounts payable to related parties pursuant to a tax
receivable agreement and income tax expense of $49.4 million
related to a substantial valuation allowance on deferred tax
assets. Adjusted pro forma net income (loss), as defined below,
was $(0.5) million for the first thirty-nine weeks, compared to
$4.4 million in the prior year and adjusted pro forma net income
(loss) per share for the first thirty-nine weeks was $(0.02) per
share, compared to $0.15 per share in the prior year.
For the first thirty-nine weeks of fiscal 2013, Adjusted EBITDA
was $5.1 million, a decrease of 63%, from $13.7 million in the
same period last year.
Default under the Credit Agreement
Due to the continued declining operating performance and limited
visibility on future liquidity, the Company's Board of Directors
determined that, in order to preserve cash, the Company would not
make a voluntary prepayment on its outstanding indebtedness that
would have been due on or before March 29, 2013 to maintain
financial covenant compliance. A voluntary prepayment of $4.0
million would have been required to maintain financial covenant
compliance. Accordingly, the Company is in violation of the Net
Senior Debt to EBITDA financial covenant under its credit
agreement as of March 29, 2013 and has received a notice of events
of default from its primary lender. The Notice states that the
lenders are not required to make further loans or incur further
obligations under the revolving loan portion of the credit
agreement and are entitled to exercise any and all default-related
rights and remedies under the agreement. The Company has
classified all of its $25.2 million of outstanding debt as a
current liability on its March 29, 2013 balance sheet. The
Company continues to engage in active and continuing discussions
with its lenders. There can be no assurance that the Company can
reach a resolution with the lenders, obtain sufficient financing
or enter into other transactions to satisfy its obligations in a
timely manner, or at all. If the Company is unable to resolve its
situation with the lenders and/or to raise sufficient additional
funds, it would be required to reduce operating expenses by, among
other things, curtailing significantly or delaying or eliminating
part or all of its new product development programs and/or scaling
back its commercial operations. In addition, at any time, the
holders of 50% or more of the outstanding principal amount under
the credit agreement can accelerate the Company's obligations
under the agreement and require payment of the full outstanding
principal amount plus accrued and unpaid interest. The Company
does not have sufficient cash resources to pay the amount that
would become payable in the event of an acceleration of these
amounts, and even if the Company could obtain additional
financing, it is unlikely that it could obtain an amount
sufficient to repay the outstanding indebtedness under the credit
agreement in full. In the event of an acceleration of its
obligations and its failure to pay the amount that would then
become due, the holders of the credit facility could seek to
foreclose on the Company's assets, as a result of which the
Company would likely need to seek protection under the provisions
of the U.S. Bankruptcy Code. In that event, the Company could
seek to reorganize its business, or the Company or a trustee
appointed by the court could be required to liquidate the
Company's assets. In either of these events, whether the
stockholders receive any value for their shares is highly
uncertain.
Delisting and Deregistration of Class A Common Stock
On April 15, 2013, the Company's Class A common stock was delisted
from the NASDAQ Global Select Market and began trading on the OTC
Markets OTCQB marketplace on April 16, 2013.
The Company intends to file a Form 15 with the Securities and
Exchange Commission after the end of the fiscal year 2013 to
effect (i) the voluntary deregistration of its Class A common
stock under the Securities Exchange Act of 1934, as amended, and
(ii) the suspension of its reporting obligations with respect to
its Class A common shares under the Exchange Act. Upon the filing
of the Form 15, the Company's obligations to file certain reports
(including periodic reports and proxy statements) with the SEC
will cease although the Company will be required to file an Annual
Report on Form 10-K for fiscal year 2013. Subject to satisfaction
of certain regulatory requirements, the Company expects
deregistration of its Class A common stock to become effective 90
days after the filing of the Form 15.
The Company intends to deregister its Class A common stock because
the Company believes the incremental cost of compliance with the
provisions of the Sarbanes-Oxley Act of 2002 and other public
company reporting requirements outweighs any discernable benefit
to the Company or its shareholders from continued registration,
and that continuing to incur such costs is not in the best
interests of the Company or its shareholders. Factors influencing
the Company's decision to deregister its Class A common shares
include the following:
-- the ever increasing accounting, legal and administrative costs
of preparing and filing periodic reports and other filings with
the SEC;
-- the amount of time senior management is required to devote to
matters related to the Company's public reporting obligations,
compared to time concentrating on the Company's business; and
-- the already limited trading volume and liquidity in the
Company's Class A common shares.
As a result of the deregistration, investors will have
significantly less information about the Company and may find it
more difficult to dispose of or obtain accurate quotations as to
the market value of the Company's Class A common stock. In
addition, the Company expects there will be a substantial decrease
in the liquidity in the Class A common stock and that the ability
of shareholders to sell the Company's securities in the secondary
market may be materially limited. Further, the market's
interpretation of the Company's motivation for "going dark" could
vary from cost savings, to negative changes in the Company's
prospects, to serving insider interests, all of which may affect
the overall price and liquidity of the Company's Class A common
stock and its ability to raise capital on terms acceptable to the
Company or at all.
DynaVox Inc. -- http://www.dynavoxtech.com-- is a holding Company
with its headquarters in Pittsburgh, Pennsylvania, whose primary
operating entities are DynaVox Systems LLC and Mayer-Johnson LLC.
DynaVox provides speech generating devices and symbol-adapted
special education software to assist individuals in overcoming
their speech, language and learning challenges.
DRYSHIPS INC: To Release First Quarter 2013 Results on May 22
-------------------------------------------------------------
DryShips Inc. on May 17 disclosed that it will release its results
for the first quarter 2013 after the market closes in New York on
Wednesday, May 22, 2013.
DryShips' management team will host a conference call the
following day on Thursday, May 23, 2013, at 9:00 a.m. EDT to
discuss the Company's financial results.
Conference Call details: Participants should dial into the call 10
minutes before the scheduled time using the following numbers:
1(866) 819-7111 (from the US), 0(800) 953-0329 (from the UK) or
+(44) (0) 1452 542 301 (from outside the US). Please quote
"DryShips."
A replay of the conference call will be available until Thursday,
May 30, 2013. The United States replay number is 1(866) 247-4222;
from the UK 0(800) 953-1533; the standard international replay
number is (+44) (0) 1452 550 000 and the access code required for
the replay is: 2133051#.
Slides and audio webcast: There will also be a simultaneous live
webcast over the Internet, through the DryShips Inc. website
(www.dryships.com). Participants to the live webcast should
register on the website approximately 10 minutes prior to the
start of the webcast.
About DryShips Inc.
Headquartered in Athens, Greece, DryShips Inc. (NASDAQ: DRYS) is
an owner of drybulk carriers and tankers that operate worldwide.
Through its majority owned subsidiary, Ocean Rig UDW Inc.,
DryShips owns and operates 10 offshore ultra deepwater drilling
units, comprising of 2 ultra deepwater semisubmersible drilling
rigs and 8 ultra deepwater drillships, 3 of which remain to be
delivered to Ocean Rig during 2013 and 1 is scheduled for
delivery during 2015. DryShips owns a fleet of 46 drybulk
carriers (including newbuildings), comprising of 12 Capesize, 28
Panamax, 2 Supramax and 4 Very Large Ore Carriers (VLOC) with a
combined deadweight tonnage of about 5.1 million tons, and 10
tankers, comprising 4 Suezmax and 6 Aframax, with a combined
deadweight tonnage of over 1.3 million tons.
The Company reported a net loss of US$288.6 million on
US$1.210 billion of revenues in 2012, compared with a net loss of
US$47.3 million on US$1.078 billion of revenues in 2011.
The Company's balance sheet at Dec. 31, 2012, showed
US$8.878 billion in total assets, US$5.010 billion in total
liabilities, and shareholders' equity of US$3.868 billion.
Going Concern Doubt
Ernst & Young (Hellas), in Athens, Greece, expressed substantial
doubt about DryShips Inc.'s ability to continue as a going
concern, citing the Company's working capital deficit of
US$670 million at Dec. 31, 2012, and in addition, the non-
compliance by the shipping segment with certain covenants of its
loan agreements with banks.
As of Dec. 31, 2012, the shipping segment was not in compliance
with certain loan-to-value ratios contained in certain of its
loan agreements. In addition, as of Dec. 31, 2012, the shipping
segment was in breach of certain financial covenants, mainly the
interest coverage ratio, contained in the Company's loan
agreements relating to US$769,098,000 of the Company's debt. As
a result of this non-compliance and of the cross default
provisions contained in all bank loan agreements of the shipping
segment and in accordance with guidance related to the
classification of obligations that are callable by the creditor,
the Company has classified all of its shipping segment's bank
loans in breach amounting to US$941,339,000 as current at
Dec. 31, 2012.
EASTMAN KODAK: Files Details of Consumer Sale, U.K. Settlement
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Eastman Kodak Co. filed papers in pursuit of formal
court approval of a settlement announced in late April where the
company's U.K. pension plan will give up a $2.84 billion claim
while purchasing the consumer-imaging and document-imaging
businesses for about $650 million in cash and notes. The hearing
for approval of the settlement will take place June 20.
The report notes that the settlement won't be carried out until
Kodak implements its Chapter 11 reorganization plan.
According to papers filed in bankruptcy court on May 15, by virtue
of a guarantee given in 2007, Kodak agreed to make good on any
underfunding in the U.K. pension plan. Kodak has been carrying a
$1.5 billion liability on its books. The pension plan filed a
claim against Kodak for $2.84 billion, representing the largest
unsecured claim in the bankruptcy. The pension plan will pay
$325 million in cash, waive the claim and give Kodak another
$325 million in notes.
Kodak previously said the U.K. pension plan has assets of about 1
billion pounds ($1.53 billion) and a deficit of 1.9 billion
pounds. The company said the settlement was "the best outcome
that could be achieved in Kodak's current circumstances."
About Eastman Kodak
Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.
Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras. Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies
with strong balance sheets and an awareness of Kodak's liquidity
challenges.
In recent years, Kodak has been working to transform itself from
a business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies. Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.
Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. FTI Consulting,
Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is
the investment banker. Kurtzman Carson Consultants LLC is the
claims agent.
The Official Committee of Unsecured Creditors has tapped Milbank,
Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.
Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
Unofficial Second Lien Noteholders Committee.
The Retirees Committee has hired Haskell Slaughter Young &
Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper,
LLC, as Bankruptcy Consultants and Financial Advisors; and the
Segal Company, as Actuarial Advisors.
Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato,
Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners
II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth
S. Grossman; and Paul Martin.
Kodak completed the $527 million sale of digital-imaging
technology on Feb. 1, 2013. Kodak intends to reorganize by
focusing on the commercial printing business.
At the end of April 2013, Kodak filed a proposed reorganization
plan offering 85 percent of the stock to holders of the remaining
$375 million in second-lien notes. The other 15 percent is for
unsecured creditors with $2.7 billion in claims and retirees who
have a $635 million claim from the loss of retirement benefits.
There will be a hearing on June 13 for the U.S. Bankruptcy Court
in New York to consider approving disclosure materials so
creditors can begin voting on Kodak's plan.
ECAST CORP: Cerner Multum to Have $12,855 Ch.11 Admin. Claim
------------------------------------------------------------
Bankruptcy Judge J. Rich Leonard denied Cerner Multum, Inc.'s
motion to compel the cure payment called for under a license
agreement executed by Cerner Multum and eCast Corporation.
David M. Warren, the Chapter 7 trustee, objected.
On December 28, 2006, Cerner Multum and the debtor executed a
license agreement, under which the debtor was granted a license to
use certain drug-specific information and intellectual property to
operate its proprietary electronic medical record software. In
exchange, the license agreement required the debtor to remit an
annual fee, which was calculated based on the number of end-users
utilizing the debtor's EMR. As of the petition date, the debtor
owed Cerner Multum an annual fee under the license agreement in
the amount of $12,855.
On November 15, 2012, the bankruptcy court entered an order
allowing the debtor's emergency motion to sell certain assets
(including software, licenses, hardware, code, patents, customers
lists, books, records and training materials) necessary for the
operation of its proprietary EMR operations to Global Record
Systems for $100,000. Included in the assets purchased by Global
Record Systems were the rights previously licensed to the debtor
by Cerner Multum. Despite acquiring and continuing to use the
license, neither the debtor nor Global Record Systems paid the
$12,855 owed under the license agreement.
Prior to the conversion to chapter 7, Cerner Multum filed the
motion currently before the court, seeking an order compelling the
payment of the cure payment, $12,855, which it is owed under the
license agreement. Despite Global Record Systems' continued use of
the license, Cerner Multum contends that neither Global Record
Systems nor the debtor paid the $12,855 cure payment required for
assumption and subsequent assignment of the license agreement. On
April 8, 2013, the trustee filed a response objecting to the
relief requested by Cerner Multum.
According to Judge Leonard, with the conversion of the debtor's
case to one under chapter 7, Cerner Multum's claim for the unpaid
amount due under the license agreement, like all allowed pre-
conversion administrative expenses, is subordinated to the post-
conversion administrative expenses allowed under 11 U.S.C. Sec.
503(b). Judge Leonard said Cerner Multum's motion to compel is
denied, and Cerner Multum will be allowed a chapter 11
administrative expense claim for $12,855, which is subordinate to
the post-conversion administrative expense claims allowed pursuant
to Sections 503(b) and 726(b).
A copy of the Court's May 16, 2013 Order is available at
http://is.gd/QKyx8xfrom Leagle.com.
About eCast Corporation
eCast Corporation was formed in 1999 to provide physicians,
independent practice associations, and other medical organizations
with medical records information through an integrated platform of
web-based components. eCast filed a voluntary chapter 11 petition
(Bankr. E.D.N.C. Case No. 12-06564) on September 13, 2012. By
consent order entered on March 7, 2013, David M. Warren was
appointed as chapter 11 trustee to administer the case. On April
12, 2013 and after determining that the debtor was unable to
effectuate a plan of reorganization, the debtor's case was
converted to one under chapter 7.
EDISON MISSION: Exclusive Plan Filing Extended Until Nov. 7
-----------------------------------------------------------
Judge Jacqueline P. Cox of the U.S. Bankruptcy Court for the
Northern District of Illinois, Eastern Division, further extended
Edison Mission Energy, et al.'s exclusive plan filing period
through and including Nov. 7, 2013, provided that the hearing to
further extend the exclusive periods must be held on Nov. 6.
The Debtors' exclusive period to solicit acceptances of the plan
is extended until Jan. 6, 2014.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
EDISON MISSION: Has Court OK to Hire Novack as Litigation Counsel
-----------------------------------------------------------------
Judge Jacqueline P. Cox of the U.S. Bankruptcy Court for the
Northern District of Illinois, Eastern Division, authorized Edison
Mission Energy, et al., to employ Novack and Macey LLP as special
litigation counsel.
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
EDISON MISSION: 3 Units File Schedules of Assets and Liabilities
----------------------------------------------------------------
Three of Edison Mission Energy's debtor affiliates delivered to
the U.S. Bankruptcy Court Northern District of Illinois its
schedules of assets and liabilities disclosing the following:
Debtor Entity Assets Liabilities
------------- ------ -----------
Edison Mission Finance Co. $624,131,870 $24,469
EME Homer City Generation L.P. $6,779,399 $584,331,101
Homer City Property Holdings, Inc. $295,130 $0
Full-text copies of EMFC's Schedules are available for free
at http://bankrupt.com/misc/EDISONMISSIONemfcsal.pdf
Full-text copies of EME Homer's Schedules are available for free
at http://bankrupt.com/misc/EDISONMISSIONemehomersal.pdf
Full-text copies of Homer City's Schedules are available for free
at http://bankrupt.com/misc/EDISONMISSIONhomersal.pdf
About Edison Mission
Santa Ana, California-based Edison Mission Energy is a holding
company whose subsidiaries and affiliates are engaged in the
business of developing, acquiring, owning or leasing, operating
and selling energy and capacity from independent power production
facilities. EME also engages in hedging and energy trading
activities in power markets through its subsidiary Edison Mission
Marketing & Trading, Inc.
EME was formed in 1986 and is an indirect subsidiary of Edison
International. Edison International also owns Southern California
Edison Company, one of the largest electric utilities in the
United States.
EME and its affiliates sought Chapter 11 protection (Bankr. N.D.
Ill. Lead Case No. 12-49219) on Dec. 17, 2012.
EME has reached an agreement with the holders of a majority of
EME's $3.7 billion of outstanding public indebtedness and its
parent company, Edison International EIX, that, pursuant to a plan
of reorganization and pending court approval, would transition
Edison International's equity interest to EME's creditors, retire
existing public debt and enhance EME's access to liquidity.
The Company's balance sheet at Sept. 30, 2012, showed
$8.17 billion in total assets, $6.68 billion in total liabilities
and $1.48 billion in total equity.
In its schedules, Edison Mission Energy disclosed total assets of
assets of $5,721,559,170 and total liabilities of $6,202,215,094
as of the Petition Date.
Kirkland & Ellis LLP is serving as legal counsel to EME, Perella
Weinberg Partners, LP is acting as financial advisor and McKinsey
Recovery & Transformation Services U.S., LLC is acting as
restructuring advisor. GCG, Inc., is the claims and notice agent.
An official committee of unsecured creditors has been appointed in
the case and is represented by the law firms Akin Gump and Perkins
Coie. The Committee also has tapped Blackstone Advisory Partners
as investment banker and FTI Consulting as financial advisor.
ENERGY FUTURE: Lower-Ranking Lenders May Recover Nothing
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that when Energy Future Holdings Corp. ends up in
bankruptcy, the value of the Texas power plant owner won't be
sufficient to cover the $22.6 billion in first-lien debt owing by
unit Texas Competitive Electric Holdings Co., according to a
report last week by Morningstar Institutional Credit Research.
The report relates that a Morningstar analyst, Joseph DeSapri,
said there may be little if not "zero value" left for second-lien
and unsecured creditors of TCEH. Morningstar's judgment about the
outcome of a bankruptcy or prepackaged Chapter 11 reorganization
is in line with current debt trading prices, where purchasers on
May 17 were offering 79.625 cents on the dollar for TCEH's 11.5
percent first-lien notes due 2020.
The outcome is driven by Morningstar's opinion that the company's
80 percent interest in the Oncor regulated utility is worth $13.7
billion to $14.3 billion.
On the other hand, Mr. DeSapri sees the enterprise value worth
"considerably more" three to five years from now when power prices
rise as supply and demand for natural gas "stabilize."
In an effort to restructure TCEH's approximately $32 billion in
debt, the company disclosed last month that it had proposed that
TCEH's first-lien lenders exchange debt for $5 billion cash or new
long-term debt of TCEH plus 85 percent of the parent's equity.
The creditors turned down the offer. Absent agreement with
creditors, Morningstar sees bankruptcy as being precipitated by a
loan-covenant violation late this year on senior debt or inability
to refinance a $3.8 billion TCEH term loan that matures in October
2014.
About Energy Future Holdings, fka TXU Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80%-owned entity within the EFH group, is the largest regulated
transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
Energy Future incurred a net loss of $3.36 billion on $5.63
billion of operating revenues for 2012. This follows net losses
of $1.91 billion in 2011 and $2.81 billion in 2010.
The Company's balance sheet at Dec. 31, 2012, showed $40.97
billion in total assets, $51.89 billion in total liabilities and a
$10.92 billion total deficit.
Restructuring Talks With Creditors
In April 2013, Energy Future Holdings Corp., Energy Future
Competitive Holdings Company, Texas Competitive Electric Holdings
Company LLC, and Energy Future Intermediate Holding Company LLC
confirmed in a regulatory filing that they are in restructuring
talks with certain unaffiliated holders of first lien senior
secured claims concerning the Companies' capital structure. The
proposed changes to the Companies' capital structure discussed
with the Creditors included a consensual restructuring of TCEH's
approximately $32 billion of debt (as of December 31, 2012). To
effect the Restructuring Proposal, EFCH, TCEH, and certain of
TCEH's subsidiaries would implement a prepackaged plan of
reorganization by commencing voluntary cases under Chapter 11 of
the U.S. Bankruptcy Code. The TCEH first lien creditors would
exchange their claims for a combination of EFH Corp. equity, in an
amount to be negotiated, and their pro rata share of $5.0 billion
of cash or new long-term debt of TCEH and its subsidiaries on
market terms. Following the issuance of EFH Corp. equity
interests to the TCEH first lien lenders under the proposed plan
of reorganization, the Sponsors would hold a to-be-negotiated
amount of the equity interests in EFH Corp.
Following implementation of the Restructuring Proposal, EFH Corp.
would continue to hold all of the equity interests in EFCH and
EFIH, EFCH would continue to hold all of the equity interests in
TCEH, and EFIH would continue to hold all of the equity interests
of Oncor Holdings. TCEH also would obtain access to $3.0 billion
of new liquidity through a $2.0 billion first lien revolver and a
$1.0 billion letter of credit facility. TCEH would also issue $5.0
billion of new long-term debt.
Substantially contemporaneously with the Companies' transmittal of
the Restructuring Proposal to the Creditors, the Sponsors informed
the Creditors that they would support the Restructuring Proposal
if the Sponsors retained 15% of EFH Corp.'s equity interests, with
the TCEH first lien creditors receiving, in the aggregate, the
remaining 85% of EFH Corp.'s equity interests, in each case
subject to dilution from any agreed-upon employee equity incentive
plan.
The Companies and the Creditors have not reached agreement on the
terms of any change in the Companies' capital structure. However,
the Creditors conveyed to the Companies that they would be willing
to consider the Restructuring Proposal, if among other things, (i)
the Restructuring Proposal adequately addresses and compensates
Creditors for the risks and consequences of exchanging a portion
of the Creditors' senior secured claims against TCEH into EFH
Corp. equity, (ii) the amount of post-reorganization debt at TCEH
to be distributed to TCEH first lien creditors were materially
increased, (iii) in the allocation of EFH Corp.'s equity between
TCEH and EFH Corp. stated in the Sponsor Proposal, the value of
TCEH and EFH Corp. were materially modified such that the TCEH
first lien creditors would receive materially greater value, and
(iv) EFIH's negative free cash flow is addressed and a sustainable
debt capital structure is achieved for EFIH and EFH Corp. without
reliance on TCEH's cash flows.
The Companies expect to continue to explore all available
restructuring alternatives to facilitate the creation of
sustainable capital structures for the Companies and to otherwise
attempt to address the Creditors' concerns with the Restructuring
Proposal and Sponsor Proposal.
The Companies have retained Kirkland & Ellis LLP and Evercore
Partners to advise the Companies with respect to the potential
changes to the Companies' capital structure and to assist in the
evaluation and implementation of other potential restructuring
options.
The Creditors have retained Paul, Weiss, Rifkind, Wharton &
Garrison LLP and Millstein & Co., L.P. to advise the Creditors and
to assist in the Creditors' evaluation of potential restructuring
options involving the Companies.
According to a Wall Street Journal report, people familiar with
the matter said Apollo Global Management LLC, Oaktree Capital
Management, Centerbridge Partners and GSO Capital Partners, the
credit arm of buyout firm Blackstone Group LP, all hold large
chunks of Energy Future Holdings' senior debt. Many of these
firms belong to a group being advised by Jim Millstein, a
restructuring expert who helped the U.S. government revamp
American International Group Inc.
According to the Journal, people familiar with Apollo's thinking
said Apollo recently enlisted investment bank Moelis & Co. for
additional advice to ensure it gets as much attention as possible
on the case given its large debt holdings.
* * *
In the Feb. 1, 2013, edition of the TCR, Fitch Ratings has lowered
the Issuer Default Ratings (IDR) of Energy Future Holdings Corp
(EFH) and Energy Future Intermediate Holding Company LLC (EFIH) to
'Restricted Default' (RD) from 'CCC' on the conclusion of the debt
exchange and removed the Rating Watch Negative.
As reported by the TCR on Feb. 4, 2013, Standard & Poor's Ratings
Services said it raised its corporate credit ratings on EFH, EFIH,
TCEH, and Energy Future Competitive Holdings Co. (EFCH) to 'CCC'
from 'D' following the completion of several debt exchanges, each
of which S&P considers distressed.
As reported by the TCR on Aug. 15, 2012, Moody's downgraded the
Corporate Family Rating (CFR) of EFH to Caa3 from Caa2 and
affirmed its Caa3 Probability of Default Rating (PDR) and SGL-4
Speculative Grade Liquidity Rating. The downgrade of EFH's CFR to
Caa3 from Caa2 reflects the company's financial distress and
limited financial flexibility.
In February 2013 , Moody's Investors Service withdraw Energy
Future Holdings Corp.'s Caa3 Corporate Family Rating, Caa3-PD
Probability of Default Rating, SGL-4 Speculative Grade Liquidity
Rating and developing rating outlook. At the same time, Moody's
assigned a Ca CFR to Energy Future Competitive Holdings Company
and a B3 CFR to Energy Future Intermediate Holdings Company LLC.
Both EFCH and EFIH are intermediate subsidiary holding companies
wholly-owned by EFH. EFCH's rating outlook is negative. EFIH's
rating outlook is negative.
"We see different default probabilities between EFCH and EFIH,"
said Jim Hempstead, senior vice president. "We believe EFCH has a
high likelihood of default over the next 6 to 12 months, because
it is projected to run out of cash in early 2014. EFIH has a much
lower likelihood of default owing to the credit separateness that
EFH is creating between EFIH and Texas Competitive Electric
Holdings Company LLC along with EFIH's reliance on stable cash
flows from its regulated transmission and distribution utility,
Oncor Electric Delivery Company."
The withdrawal of EFH's CFR reflects a series of recent actions
taken by EFH to insulate both EFH and EFIH from its more
distressed subsidiary, EFCH, which appears to have a much higher
probability of default within the consolidated corporate family.
ENJOI TRANSPORTATION: Case Summary & Creditors List
---------------------------------------------------
Debtor: Enjoi Transportation, L.L.C.
dba Enjoi Shuttle, L.L.C.
Renaissance Sedan & Shuttle, L.L.C.
Enjoi Transportation Solutions, LLC
1545 Clay Street
Detroit, MI 48211
Bankruptcy Case No.: 13-49751
Chapter 11 Petition Date: May 13, 2013
Court: U.S. Bankruptcy Court
Eastern District of Michigan (Detroit)
Judge: Marci B. McIvor
Debtor's Counsel: Edward J. Gudeman, Esq.
GUDEMAN & ASSOCIATES, P.C.
26862 Woodward Avenue, Suite 103
Royal Oak, MI 48067
Tel: (248) 546-2800
E-mail: ejgudeman@gudemanlaw.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/mieb13-49751.pdf
The petition was signed by Paulette Hamilton, managing member.
FERRELLGAS PARTNERS: S&P Raises Senior Unsecured Rating to 'B'
--------------------------------------------------------------
Standard & Poor's Ratings Services revised the rating outlook on
Ferrellgas Partners L.P. and its operating subsidiary Ferrellgas
L.P. to positive from stable. S&P also affirmed its 'B' corporate
credit rating on the companies. At the same time, S&P raised its
senior unsecured rating on Ferrellgas L.P. to 'B' from 'B-' and
revised the recovery rating to '4' from '5', which indicates S&P's
expectations for average (30%-50%) recovery for lenders if a
payment default occurs. The 'CCC+' issue-level rating with a '6'
recovery rating on Ferrellgas Partners remain unchanged. As of
Jan. 31, 2013, Ferrellgas Partners had about $1.3 billion of
balance-sheet debt.
The positive outlook reflects S&P's view that the partnership's
credit profile is improving, with expected debt to EBITDA of 4.75x
to 5x and a distribution coverage ratio of more than 1x in 2013.
"We could raise the rating if Ferrellgas is able to maintain
retail margins of about 70 cents per gallon and increase its total
propane volumes, such that debt to EBITDA is in the low 5x area
and distribution coverage is at least 1x through the next winter
heating season. This target leverage ratio likely correlates to
5.5x to 5.75x during winter months when working capital borrowings
peak, depending on commodity prices. S&P could revise the outlook
to stable if debt leverage is sustained at about 6x and
distribution coverage is less than 1x," said Standard & Poor's
credit analyst Michael Grande.
FIRE CONTROL: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Fire Control Electrical Systems, Inc.
320 Essex Street, Suite 3
Stirling, NJ 07980
Bankruptcy Case No.: 13-20189
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
District of New Jersey (Newark)
Judge: Rosemary Gambardella
Debtors' Counsel: William R. McClure, Esq.
PICINICH & MCCLURE, LLC
201 West Passaic Street, Suite 204
Rochelle Park, NJ 07662
Tel: (201) 820-4595
Fax: (201) 820-4594
E-mail: wrmesq@verizon.net
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
Affiliates that simultaneously filed for Chapter 11:
Debtor Case No.
------ --------
Meadowlands Electronics, Inc. 13-20190
Assets: $500,001 to $1,000,000
Debts: $1,000,001 to $10,000,000
Somerset International Group, Inc. 13-20191
Assets: $500,001 to $1,000,000
Debts: $1,000,001 to $10,000,000
Secure System, Inc. 13-20186
The petitions were signed by John X. Adiletta, chief executive
officer.
The Debtors did not file a list of top unsecured creditors
together with the petitions.
FIRST DATA: S&P Rates Subordinate Notes Due 2021 'CCC+'
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC+' issue-level
rating to First Data Corp.'s subordinated notes due 2021. The
recovery rating on this debt is '6' indicating expectations of
negligible (0% to 10%) recovery for lenders in a payment default.
The company intends to use the proceeds from the proposed notes
for the repayment of a like amount of existing subordinated notes
due 2016.
"Our 'B' corporate credit and other ratings and stable outlook on
First data reflect its leading market presence as a provider of
payment processing services for merchants and financial
institutions, which we regard as a "strong" business risk profile.
The ratings also reflect the company's highly leveraged financial
profile reflects a debt to EBITDA ratio that remains very high for
the rating at about 10x as of March 31, 2013. Given our
expectations for revenue and EBITDA growth, we do not expect
material improvement in credit metrics through 2013," S&P said.
RATINGS LIST
First Data Corp.
Corporate Credit Rating B/Stable/--
New Rating
First Data Corp.
Subordinated Notes CCC+
Recovery Rating 6
FIRST FINANCIAL: Presented at 2013 Annual Shareholders Meeting
--------------------------------------------------------------
First Financial Service Corporation delivered to the U.S.
Securities and Exchange Commission a copy of the presentation that
was used at the annual meeting of the shareholders of the Company
on May 15, 2013, in Elizabethtown, Kentucky. The Company
disclosed that its main objectives for 2013 are: (1) return to
profitability, (2) capital restoration, and (3) asset quality
remediation. A copy of the presentation is available for free at:
http://is.gd/thQqWu
About First Financial
Elizabethtown, Kentucky-based First Financial Service Corporation
is the parent bank holding company of First Federal Savings Bank
of Elizabethtown, which was chartered in 1923. The Bank serves
six contiguous counties encompassing central Kentucky and the
Louisville metropolitan area, through its 17 full-service banking
centers and a commercial private banking center.
In its 2012 Consent Order, the Bank agreed to achieve and maintain
a Tier 1 capital ratio of 9.0% and a total risk-based capital
ratio of 12.0% by June 30, 2012.
"At December 31, 2012, the Bank's Tier 1 capital ratio was 6.53%
and the total risk-based capital ratio was 12.21%. We notified
the bank regulatory agencies that one of the two capital ratios
would not be achieved and are continuing our efforts to meet and
maintain the required regulatory capital levels and all of the
other consent order issues for the Bank," the Company said in its
annual report for the year ended Dec. 31, 2012.
First Financial disclosed a net loss attributable to common
shareholders of $9.44 million in 2012, a net loss attributable to
common shareholders of $24.21 million in 2011 and a net loss
attributable to common shareholders of $10.45 million in 2010.
The Company's balance sheet at Dec. 31, 2012, showed $1 billion in
total assets, $962.69 million in total liabilities and $44.37
million in total stockholders' equity.
Crowe Horwath LLP, in Louisville, Kentucky, said in its report on
the consolidated financial statements for the year ended Dec. 31,
2012, "[T]he Company has recently incurred substantial losses,
largely as a result of elevated provisions for loan losses and
other credit related costs. In addition, both the Company and its
bank subsidiary, First Federal Savings Bank, are under regulatory
enforcement orders issued by their primary regulators. First
Federal Savings Bank is not in compliance with its regulatory
enforcement order which requires, among other things, increased
minimum regulatory capital ratios. First Federal Savings Bank's
continued non-compliance with its regulatory enforcement order may
result in additional adverse regulatory action."
FIRST INDUSTRIAL: S&P Raises CCR to BB & Rates Preferred Stock B
----------------------------------------------------------------
Standard & Poor's Ratings Services said it raised its corporate
credit rating on First Industrial Realty Trust and First
Industrial L.P. (collectively First Industrial) to 'BB' from
'BB-'. The outlook is stable.
At the same time, S&P raised its rating on the company's preferred
stock to 'B' from 'B-'. S&P also raised its issue-level rating on
the company's senior unsecured notes to 'BB+' from 'BB'; the
recovery rating for the unsecured debt remains '2'.
"The upgrade acknowledges First Industrial's improved debt
coverage measures, lower leverage, and strengthened property
fundamentals," said Standard & Poor's credit analyst Elizabeth
Campbell. "As a result we have revised our view of First
Industrial's financial risk profile to significant from
aggressive, she added.
Standard & Poor's view of First Industrial's business risk
profile, though modestly improved, remains unchanged at "fair,"
which acknowledges its sizable industrial portfolio's good
geographic and tenant diversity. S&P expects First Industrial to
continue to modestly improve portfolio occupancy and rents this
year, such that same-store NOI grows in the low single digits.
S&P also expects First Industrial to continue to pursue
speculative development in a prudent manner, such that it
maintains its recently improved leverage, liquidity, and
debt coverage measures.
Chicago-based First Industrial, with a $2.6 billion asset base,
owns and operates industrial properties with an aggregate 63.2
million square feet of gross leasable space.
S&P's stable outlook acknowledges its expectation that the
improvements in the company's portfolio occupancy, rent, and NOI
and debt coverage measures are sustainable. Recent deleveraging
and contribution from the lease-up of recently stabilized
development projects should support further modest improvement in
FCC measures this year.
Longer term, S&P would consider raising the corporate credit
rating again if FCC improves above 2.3x, as this would alter its
view of the company's financial risk profile to "intermediate."
Under this scenario, improvements would likely be due to rent and
occupancy gains and the modest pursuit of profitable new
development.
Given the recent upgrade, S&P currently do not foresee taking any
negative rating actions in the near term, unless First Industrial
were to reverse its previously noted balance sheet and liquidity
improvements (perhaps through the pursuit of debt-financed
speculative development, although S&P considers this unlikely).
FIRST MARINER: Incurs $2.3 Million Net Loss in First Quarter
------------------------------------------------------------
First Mariner Bancorp filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $2.27 million on $11.13 million of total interest income for
the three months ended March 31, 2013, as compared with net income
of $1.82 million on $11.61 million of total interest income for
the same period during the prior year.
The Company's balance sheet at March 31, 2013, showed $1.30
billion in total assets, $1.31 billion in total liabilities and a
$11.12 million total stockholders' deficit.
A copy of the Form 10-Q is available for free at:
http://is.gd/LAfRVo
About First Mariner
Headquartered in Baltimore, Maryland, First Mariner Bancorp
-- http://www.1stmarinerbancorp.com/-- is a bank holding company
whose business is conducted primarily through its wholly owned
operating subsidiary, First Mariner Bank, which is engaged in the
general general commercial banking business. First Mariner was
established in 1995 and has total assets in excess of $1.3 billion
as of Dec. 31, 2010.
First Mariner disclosed net income of $16.11 million in 2012, as
compared with a net loss of $30.24 million in 2011.
Stegman & Company, in Baltimore, Maryland, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that the Company has insufficient capital per regulatory
guidelines and has failed to reach capital levels required in the
Cease and Desist Order issued by the Federal Deposit Insurance
Corporation in September 2009. These matters raise substantial
doubt about the Company's ability to continue as a going concern.
Regulatory matters and capital adequacy
Various regulatory capital requirements administered by the
federal banking agencies apply to First Mariner and the Bank.
Failure to meet minimum capital requirements can initiate certain
mandatory, and possibly additional discretionary, actions by
regulators that, if undertaken, could have a direct material
effect on the Company's financial statements. Under capital
adequacy guidelines and the regulatory framework for prompt
corrective action, the Bank must meet specific capital guidelines
that involve quantitative measures of assets, liabilities, and
certain off-balance sheet items as calculated under regulatory
accounting practices. The Bank's capital amounts and
classification are also subject to qualitative judgments by the
regulators about components, risk weightings, and other factors.
Quantitative measures established by regulation to ensure capital
adequacy require the Bank to maintain minimum amounts and ratios
of total and Tier I capital to risk-weighted assets, and of Tier I
capital to average quarterly assets. As of both March 31, 2013,
and Dec. 31, 2012, the Bank was "undercapitalized" under the
regulatory framework for prompt corrective action.
FIRST NATIONAL: Reports $1.7 Million Net Income in First Quarter
----------------------------------------------------------------
First National Community Bancorp, Inc., filed with the U.S.
Securities and Exchange Commission its quarterly report on Form
10-Q disclosing net income of $1.73 million on $8.21 million of
total interest income for the three months ended March 31, 2013,
as compared with a net loss of $1.16 million on $9.74 million of
total interest income for the same period a year ago.
The Company's balance sheet at March 31, 2013, showed $929.52
million in total assets, $892.70 million in total liabilities and
$36.81 million in total shareholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/9kbPyX
About First National
Headquartered in Dunmore, Pa., First National Community Bancorp,
Inc., is a Pennsylvania corporation, incorporated in 1997 and is
registered as a bank holding company under the Bank Holding
Company Act ("BHCA") of 1956, as amended. The Company became an
active bank holding company on July 1, 1998, when it acquired
ownership of First National Community Bank (the "Bank"). The Bank
is a wholly-owned subsidiary of the Company.
The Company's primary activity consists of owning and operating
the Bank, which provides customary retail and commercial banking
services to individuals and businesses. The Bank provides
practically all of the Company's earnings as a result of its
banking services.
First National disclosed a net loss of $13.71 million on $37.02
million of total interest income for the year ended Dec. 31, 2012,
as compared with a net loss of $335,000 on $42.93 million of total
interest income in 2011.
Regulatory Matters
The Bank is under a Consent Order from the Office of the
Comptroller of the Currency dated Sept. 1, 2010. The Company is
also subject to a Written Agreement with the Federal Reserve Bank
of Philadelphia dated Nov. 24, 2010.
The Bank, pursuant to a Stipulation and Consent to the Issuance of
a Consent Order dated Sept. 1, 2010, without admitting or denying
any wrongdoing, consented and agreed to the issuance of the Order
by the OCC, the Bank's primary regulator. The Order requires the
Bank to undertake certain actions within designated timeframes,
and to operate in compliance with the provisions thereof during
its term. The Order is based on the results of an examination of
the Bank as of March 31, 2009. Since the examination, management
has engaged in discussions with the OCC and has taken steps to
improve the condition, policies and procedures of the Bank.
Compliance with the Order is monitored by a committee of at least
three directors, none of whom is an employee or controlling
shareholder of the Bank or its affiliates or a family member of
any such person. The Committee is required to submit written
progress reports on a monthly basis to the OCC and the Agreement
requires the Bank to make periodic reports and filings with the
Federal Reserve Bank. The members of the Committee are John P.
Moses, Joseph Coccia, Joseph J. Gentile and Thomas J. Melone.
Banking regulations also limit the amount of dividends that may be
paid without prior approval of the Bank's regulatory agency. At
Dec. 31, 2012, the Company and the Bank are restricted from paying
any dividends, without regulatory approval.
FIRST SECURITY: Incurs $7.9 Million Net Loss in First Quarter
-------------------------------------------------------------
First Security Group filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
allocated to common shareholders of $7.90 million on $7.81 million
of total interest income for the three months ended March 31,
2013, as compared with a net loss allocated to common shareholders
of $6.34 million on $9.68 million of total interest income for the
same period during the prior year.
The Company's balance sheet at March 31, 2013, showed $1.04
billion in total assets, $1.01 billion in total liabilities and
$20.99 million in total shareholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/sayvJv
First Security separately filed a post-effective amendment to the
Form S-1 registration statement for the purpose of removing from
registration shares of the Company's Fixed Rate Cumulative
Perpetual Preferred Stock, Series A, no par value, a warrant to
purchase Common Stock, $0.01 par value per share, and shares of
Common Stock issuable upon exercise of the Warrant, in each case
remaining unsold at the termination of an offering.
The Post-Effective Amendment No. 1 amends the Registration
Statement on Form S-3 originally filed with the SEC on Feb. 9,
2009. The Company filed the Registration Statement to register
the potential resale of shares of Preferred Stock, the Warrant and
shares of Common Stock issuable upon exercise of the Warrant by
selling securityholders.
The Company issued shares of Preferred Stock and the Warrant to
the United States Department of the Treasury in January 2009
pursuant to the Capital Purchase Program established by Treasury
under the Troubled Asset Relief Program.
In April 2013, the Company redeemed from Treasury all shares of
Preferred Stock and the Warrant held by Treasury. No portion of
the Warrant had been previously exercised. As a result, as of
May 15, 2013, all of the securities issued to the Treasury have
been redeemed by the Company.
A copy of the Amendment is available for free at:
http://is.gd/ye5cUa
About First Security Group
First Security Group, Inc., is a bank holding company
headquartered in Chattanooga, Tennessee, with $1.2 billion in
assets as of Sept. 30, 2010. Founded in 1999, First
Security's community bank subsidiary, FSGBank, N.A., has 37 full-
service banking offices, including the headquarters, along the
interstate corridors of eastern and middle Tennessee and northern
Georgia and 325 full-time equivalent employees. In Dalton,
Georgia, FSGBank operates under the name of Dalton Whitfield Bank;
along the Interstate 40 corridor in Tennessee, FSGBank operates
under the name of Jackson Bank & Trust.
In the auditors' report accompanying the financial statements for
year ended Dec. 31, 2011, Joseph Decosimo and Company, PLLC, in
Chattanooga, Tennessee, expressed substantial doubt about the
Company's ability to continue as a going concern. The independent
auditors noted that the Company has recently incurred substantial
losses. The Company is also operating under formal supervisory
agreements with the Federal Reserve Bank of Atlanta and the Office
of the Comptroller of the Currency and is not in compliance with
all provisions of the Agreements. Failure to achieve all of the
Agreements' requirements may lead to additional regulatory
actions.
The Company reported a net loss of $23.06 million in 2011, a net
loss of $44.34 million in 2010, and a net loss of $33.45 million
in 2009.
FONTENOT'S PRECISION: Case Summary & Creditors List
---------------------------------------------------
Debtor: Fontenot's Precision Iron Works, LLC
P.O. Box 254
Berwick, LA 70342-0000
Bankruptcy Case No.: 13-50528
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Western District of Louisiana (Lafayette)
Judge: Robert Summerhays
Debtor's Counsel: William C. Vidrine, Esq.
VIDRINE & VIDRINE
711 West Pinhook Road
Lafayette, LA 70503
Tel: (337) 233-5195
E-mail: williamv@vidrinelaw.com
Scheduled Assets: $818,235
Scheduled Liabilities: $1,328,210
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/lawb13-50528.pdf
The petition was signed by David Fontenot, president.
FOX VALLEY: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Fox Valley Women & Children's Health Partners, Ltd.
3310 W. Main Street, Suite 200
St. Charles, IL 60175
Bankruptcy Case No.: 13-20024
Chapter 11 Petition Date: May 10, 2013
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Timothy A. Barnes
Debtor's Counsel: Bruce E de'Medici, Esq.
834 Forest Avenue
Oak Park, IL 60302
Tel: (312) 731-6778
E-mail: bdemedici@gmail.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/ilnb13-20024.pdf
The petition was signed by Seven D. Bush, president.
Affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
Seven D. Bush 12-46302 11/26/12
FREESCALE SEMICONDUCTOR: S&P Assigns 'B' Rating to 1st Lien Notes
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' issue-level
rating to Freescale Semiconductor Inc.'s first-lien notes due
2021. The recovery rating on this debt is '3', indicating
expectations of meaningful (50% to 70%) recovery for lenders in a
payment default. The company intends to use the proceeds from the
proposed notes for the repayment of a portion of its existing
first-lien notes due 2018. S&P rates the new notes the same as
the corporate credit rating on the company.
The 'B' corporate credit and other ratings and stable outlook
reflect the company's position as one of the leading providers of
automotive semiconductor products, moderated by its U.S. and
European automotive client concentration and its exposure to
cyclical market conditions, which contribute to a "fair" business
risk profile. While Freescale's revenues and earnings declined in
2012 due to cyclical market weakness and the secular downturn of
its cellular handset business, S&P expects modest revenue growth
and flat earnings performance over the coming year, such that
leverage remains elevated at about 9x during 2013 and subsides to
the mid-8x area in late 2013. Consequently, the company's
financial risk profile remains "highly leveraged".
RATINGS LIST
Freescale Semiconductor Inc.
Corporate Credit Rating B/Stable/--
New Rating
Freescale Semiconductor Inc.
First-Lien Notes Due 2021 B
Recovery Rating 3
FULLCIRCLE REGISTRY: Incurs $27,900 Net Loss in First Quarter
-------------------------------------------------------------
FullCircle Registry, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $27,983 on $454,301 of revenues for the three months
ended March 31, 2013, as compared with a net loss of $68,242 on
$444,643 of revenues for the same period during the prior year.
The Company's balance sheet at March 31, 2013, showed $6.09
million in total assets, $6.06 million in total liabilities and
$34,231 in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/tMuTFn
About FullCircle Registry
Shelbyville, Kentucky-based FullCircle Registry, Inc., targets the
acquisition of small profitable businesses. FullCircle Registry,
Inc., has become a holding company with three subsidiaries. They
are FullCircle Entertainment, Inc., FullCircle Insurance Agency,
Inc. and FullCircle Prescription Services, Inc. Target companies
for future acquisition are those in search of exit plans for the
owners and are intended to continue autonomous operations as
current ownership is phased out over a period of 3-5 years.
In its report on the consolidated financial statements for the
year ended Dec. 31, 2012, Rodefer Moss & Co., PLLC, in New Albany,
Indiana, expressed substantial doubt about FullCircle Registry's
ability to continue as a going concern, citing the Company's
recurring losses from operations and net working capital
deficiency.
The Company reported a net loss of $369,784 on $1.9 million of
revenues in 2012, compared with a net loss of $570,302 on
$1.3 million of revenues in 2011.
GAME TRADING: Settles Baltimore County's Claim
----------------------------------------------
Bankruptcy Judge Nancy V. Alquist signed off on a stipulation and
consent order between Peter Chadwick, in his capacity as
Responsible Officer for the estates of Game Trading Technologies,
Inc. and Gamers Factory, Inc.; and Baltimore County, Maryland.
On May 23, 2012, Baltimore County filed Claim No. 16-1 in Case No.
12-11522, asserting a $14,230.05 unsecured priority claim for
personal property taxes allegedly owed by Gamers Factory to
Baltimore County. On August 10, 2012, Baltimore County filed
Claim No. 16-2 in Case No. 12-11522 in the total amount of
$14,680.05, which amended and superseded Claim No. 16-1, to add a
$450.00 general unsecured claim for false fire alarm fees to the
initial claim. On February 19, 2013, Baltimore County filed its
Motion to Allow Filing of Second Amended Proof of Claim.
The Responsible Officer objected. A hearing on the Motion to
Amend is currently scheduled for July 3, 2013 at 10:00 a.m.
On May 10, 2013, the parties agreed to the principal terms of an
agreement resolving the Motion to Amend and the Claim Objection.
The parties determined that it was in the best interest of the
estate and Baltimore County to settle the Claim.
The parties agree that:
1) The Motion to Amend is withdrawn, with prejudice.
2) The First Amended Claim [Claim No. 16-2], is allowed in
full and classified as:
a) Baltimore County will have an allowed unsecured
priority claim under 11 U.S.C. Sec. 507(a)(8) in the
amount of $7,115.03.
b) Baltimore County will have an allowed general
unsecured claim in the amount of $7,565.02.
3) Baltimore County will have no further claims in the
bankruptcy cases.
A copy of the May 13, 2013 Stipulation and Consent Order is
available at http://is.gd/QOgXokfrom Leagle.com.
Baltimore County is represented by:
Bambi Glenn, Esq.
Baltimore County Office of Law
400 Washington Avenue, Room 219
Towson, MD 21204
Tel: (410) 887-4420
E-mail: bglenn@baltimorecountymd.gov
About Game Trading Technologies
Game Trading Technologies Inc., fka City Language Exchange, Inc.,
(OTC BB: GMTD) filed for Chapter 11 protection (Bankr. D. Md. Lead
Case No. 12-11519) on Jan. 30, 2012. James Edward Van Horn, Jr.,
Esq., at McGuirewoods LLP, represents the Debtor.
WeinsweigAdvisors LLC's Marc Weinsweig serves as chief
restructuring officer.
When it filed for bankruptcy, Game Trading estimated $0 to $50,000
in assets and $1 million to $10 million in debts. Affiliate
Gamers Factory, Inc., filed a separate petition for Chapter 11
relief (Bankr. D. Md. Case No. 12-11522) on the same day, listing
$1 million to $10 million in both assets and debts.
An Official Committee of Unsecured Creditors has been appointed in
the case. The panel is represented by Gary H. Leibowitz, Esq.,
and G. David Dean, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A.
On Feb. 8, 2012, the Debtors filed their proposed plan of
reorganization and motion to establish bidding procedures for and
sale of substantially all of the companies' assets. Pursuant to
the sale and bid procedures motion, the companies seek to sell,
subject to higher and better offers and bankruptcy Court approval,
substantially all of their assets to two stalking horse bidders,
DK Trading Partners, LLC, and Mantomi Sales, LLC, respectively.
Mantomi Sales, LLC, is 100% owned by Todd Hayes, the Debtors'
president and CEO. Pursuant to the Mantomi Sales LLC asset
purchase agreement, (i) Mr. Hays was required to resign as
President and CEO of the companies on or before the execution of
the Mantomi APA; (ii) the companies' Chief Restructuring Officer
may employ Mr. Hays as an independent consultant to the companies
in matters unrelated to the sale; and (iii) nothing in the Mantomi
APA constitutes or will be deemed a breach of the employment
agreement between Mr. Hays and the companies.
Counsel for the Official Committee of Unsecured Creditors are Gary
H. Leibowitz, Esq., and G. David Dean, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, P.A.
GROWLIFE INC: Incurs $1.18-Mil. Net Loss in 1st Quarter
-------------------------------------------------------
GrowLife, Inc., filed its quarterly report on Form 10-Q, reporting
a net loss of $1.18 million on $760,709 of net revenue for the
three months ended March 31, 2013, compared with a net loss of
$121,686 on $91,809 of net revenue for the same period last year.
The increase in net revenue was mainly due to the successful
implementation of the Company's acquisition program.
During the quarter ended March 31, 2013, the Company incurred
other expenses totaling $723,219 versus only $4,584 during the
same period in fiscal year 2012. Included in the $723,219 first
quarter charge is $667,541 of non-cash expense related to
conversion features associated with the 6% Notes issued during
fiscal year 2012 and the 10% Convertible Notes issued in January
2013. There was no similar expense incurred during the three
month period ended March 31, 2012.
The Company's balance sheet at March 31, 2013, showed
$1.44 million in total assets, $1.27 million in total liabilities,
and stockholders' equity of $172,341.
According to the regulatory filing, for the three months ended
March 31, 2013, the Company incurred a net loss of $1,182,962,
cash used in operations was $318,214, and had stockholders' equity
of $172,341. "The Company has experienced recurring operating
losses and negative operating cash flows since inception, and has
financed its working capital requirements during this period
primarily through the recurring issuance of notes payable and
advances from a related party. These facts indicate that the
Company substantial doubt of the Company's continuation as a going
concern."
A copy of the Form 10-Q is available at http://is.gd/NskKkr
Woodland Hills, Calif.-based GrowLife, Inc., manufactures and
supplies branded equipment and expendables that promote and
enhance the characteristics of quality and quantity of indoor and
outdoor urban gardening.
HANDY HARDWARE: Littlejohn Working on Plan to Acquire Business
--------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Handy Hardware Wholesale Inc., a Houston-based buying
cooperative for 1,300 retail stores, is in talks for Littlejohn
Management Holdings to acquire the company as a going concern by
financing a Chapter 11 reorganization plan.
To deal with Handy's default on the $30 million in bankruptcy
financing supplied by Wells Fargo Bank NA, the bankruptcy court in
Delaware approved an amendment to the loan agreement where
Littlejohn will increase the facility by $4 million.
Approved by the court, the revised loan's maturity is extended
until Aug. 9 and the default is cleared. The revised loan
requires holding a hearing by June 19 for approval of disclosure
materials explaining the reorganization plan. Littlejohn already
delivered a non-binding letter of intent. Creditors are working
with Littlejohn on a plan-support agreement, according to a court
filing.
About Handy Hardware
Handy Hardware Wholesale, Inc., filed a Chapter 11 petition
(Bankr. D. Del. Case No. 13-10060) on Jan. 11, 2013.
Handy Hardware is engaged in the business of buying goods from
vendors and selling those goods at a discounted price to its
members for sale in their retail stores. Handy Hardware, which
has 300 employees, is operating on a cooperative basis and is
completely member-owned, with over 1,000 members. The Debtor's
warehouse facilities are located in Houston, Texas, and in
Meridian, Mississippi. Trucking services are provided by Averitt
Express, Inc., and Trans Power Corp. Its members operate 1,300
retail stores, home centers, and lumber yards. The members are
located in 14 states throughout the U.S. as well as in Mexico,
South America, and Puerto Rico.
Bankruptcy Judge Mary F. Walrath oversees the case. Lawyers at
Ashby & Geddes, P.A., serve as the Debtor's counsel. MCA
Financial serves as financial advisor. Donlin Recano serves as
claims and noticing agent. The Debtor disclosed $79,169,106 in
assets and $77,605,085 plus an unknown in liabilities as of the
Chapter 11 filing.
A seven-member official committee of unsecured creditors has been
appointed in the case.
Wells Fargo is providing a $30 million revolving credit to finance
operations in Chapter 11.
HARLAND CLARKE: S&P Keeps 'B+' Notes Rating on $50MM Add-On
-----------------------------------------------------------
Standard & Poor's Ratings Services said that its 'B+' rating on
Harland Clarke Holdings Corp.'s (HCHC's) senior secured notes due
2018 remains unchanged following the proposed $50 million add-on.
The recovery rating on this debt is '3', indicating S&P's
expectation of meaningful (50%-70%) recovery for lenders in the
event of a payment default. The company plans to use the proceeds
to repay a portion of its senior fixed rate notes due 2015.
Pro forma for the transaction, HCHC will have $285 million
outstanding under its senior secured notes due 2018 and
$221 million outstanding under its senior fixed rate notes due May
2015. The transaction does not change debt leverage and does not
materially change annual interest expense.
The 'B+' issue rating on the notes is at the same level as S&P's
'B+' corporate credit rating on HCHC. The corporate credit rating
reflects S&P's expectation that leverage will decline over the
next few years, but still remain high; that check usage will
continue to decline at a mid-single-digit percentage rate; and
that the financial policy of HCHC's parent, private-equity
investor M&F Worldwide Corp. (MFW), will remain aggressive.
HCHC's financial policy and that of MFW, combined with HCHC's high
leverage, are the principal reasons S&P considers its financial
risk profile "aggressive."
HCHC's business risk profile is "weak," in S&P's opinion, based on
its exposure to a secular shift from printed check usage to
alternative forms of payment. S&P believes these dynamics will
result in continued pressure on cash flow generation.
S&P views the company's management and governance as "fair,"
despite the company's high leverage, history of dividends, and its
sponsor's practice of moving assets between entities. Under S&P's
base-case scenario, it expects revenue to remain relatively flat
or decline at a low-single-digit percent rate in 2013. For the
same period, S&P expects EBITDA to increase in the low-single-
digit percent rate, primarily due to cost reductions. S&P expects
HCHC's leverage to decline over the intermediate term, aided by
the company's high mandatory debt amortization requirements.
RATINGS LIST
Harland Clarke Holdings Corp.
Corporate credit rating B+/Stable/--
Senior secured B+
Recovery rating 3
HELLER EHRMAN: No Appeal Yet on Montali's 'Jewel' Opinion
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the liquidation of the law firm Heller Ehrman LLC
won't entail a ruling in the near term by an appellate court on
the pivotal question of whether a law firm that completes business
begun by the failed firm must pay income or profit on that
business to the trustee for the defunct firm.
The report recounts that in March, U.S. Bankruptcy Judge Dennis
Montali in San Francisco wrote a 39-page opinion ruling that firms
taking on lawyers from a failing legal practice are automatically
liable to the failed firm for profits on business those lawyers
bring to their new firms.
A reorganization plan for the firm was court-approved in August
2010. The administrator under the plan sued law firms that took
on former partners. Most settled. Four that didn't were Davis
Wright Tremaine LLP, Foley & Lardner LLP, Jones Day and Orrick
Herrington & Sutcliffe LLP.
The report relates that the firms, having lost in Judge Montali's
March opinion, the firms sought permission from the district court
to appeal, even though the lawsuits weren't completed. The
district judge denied the request for a so-called interlocutory
appeal. Consequently, the firms won't be able to appeal until
conclusion of a trial, unless they settle beforehand.
Mr. Rochelle notes that the law firms' liability turns on a
California appellate decision from a case called Jewel. There is
controversy in the legal community about whether Jewel is good law
countrywide, or even in California, in view of changes in
partnership law. Whether there is liability for completing
unfinished business is currently on appeal in federal court in New
York involving other failed law firms.
Partners at California-based Heller Ehrman voted to dissolve in
September 2008. At the same time, they voted to waive potential
liabilities under the Jewel doctrine. Judge Montali
found that the so-called Jewel waiver in itself was a fraudulent
transfer. For a discussion of Montali's opinion, click here for
the March 14 Bloomberg bankruptcy report.
In a decision in December 2011, a district judge ruled in the
Heller Ehrman case that Judge Montali can't make final rulings in
the fraudulent-transfer cases.
One of the lawsuits is Heller Ehrman LLP v. Jones Day (In re
Heller Ehrman LLP), 10-3221, U.S. Bankruptcy Court, Northern
District of California (San Francisco).
About Heller Ehrman
Headquartered in San Francisco, California, Heller Ehrman, LLP
-- http://www.hewm.com/-- was an international law firm of more
than 730 attorneys in 15 offices in the United States, Europe, and
Asia. Heller Ehrman filed a voluntary Chapter 11 petition (Bankr.
N.D. Cal., Case No. 08-32514) on Dec. 28, 2008. Members of the
firm's dissolution committee led by Peter J. Benvenutti approved a
plan dated Sept. 26, 2008, to dissolve the firm. The Hon. Dennis
Montali presides over the case. Pachulski Stang Ziehl & Jones LLP
assisted the Debtor in its restructuring effort. The Official
Committee of Unsecured Creditors is represented by Felderstein
Fitzgerald Willoughby & Pascuzzi LLP. The firm estimated assets
and debts at $50 million to $100 million as of the Petition Date.
According to reports, the firm had roughly $63 million in assets
and 54 employees at the time of its filing. On Aug. 13, 2010, the
Court confirmed Heller's Joint Plan of Liquidation.
HOTEL OUTSOURCE: Incurs $412,000 Net Loss in 1st Quarter
--------------------------------------------------------
Hotel Outsource Management International, Inc., filed its
quarterly report on Form 10-Q, reporting a net loss of $412,000 on
$982,000 of revenues for the three months ended March 31, 2013,
compared with a net loss of $317,000 on $858,000 of revenues for
the same period last year.
The Company's balance sheet at March 31, 2013, showed $5.0 million
in total assets, $4.0 million in total liabilities, and
stockholders' equity of $986,000.
A copy of the Form 10-Q is available at http://is.gd/COVVg1
Hotel Outsource Management International, Inc., is engaged in the
distribution, marketing and operation of computerized minibars in
hotels located in the United States, Europe, Israel and Canada.
The Company is headquartered in New York City.
* * *
As reported in the TCR on April 19, 2013, Barzily & Co., in
Jerusalem, Israel, expressed substantial doubt about Hotel
Outsource's ability to continue as a going concern, citing the
Company's recurring losses from operations and net working capital
deficiency.
ISRA HOMES: Case Summary & 16 Unsecured Creditors
-------------------------------------------------
Debtor: Isra Homes, Inc.
1509 49th Street S.
Gulfport, FL 33707
Bankruptcy Case No.: 13-06256
Chapter 11 Petition Date: May 12, 2013
Court: United States Bankruptcy Court
Middle District of Florida (Tampa)
Judge: Catherine Peek McEwen
Debtor's Counsel: Joel S. Treuhaft, Esq.
PALM HARBOR LAW GROUP, P.A.
2997 Alt 19 Ste B
Palm Harbor, FL 34683-1907
Tel: (727) 797-7799
Fax: (727) 213-6933
E-mail: jstreuhaft@yahoo.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 16 largest unsecured creditors
is available for free at http://bankrupt.com/misc/flmb13-6256.pdf
The petition was signed by Ariel S. Bergerman, president.
INVESTORS GROUP: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Investors Group, LLC
fka WE Investors Group, LLC
5001 Spring Valley Road, 5th Floor
Addison, TX 75244
Bankruptcy Case No.: 13-32488
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Stacey G. Jernigan
Debtor's Counsel: Jason Patrick Kathman, Esq.
PRONSKE & PATEL, P.C.
2200 Ross Avenue, Suite 5350
Dallas, TX 75201
Tel: (214) 658-6500
Fax: (214) 658-6509
E-mail: jkathman@pronskepatel.com
- and ?
Gerrit M. Pronske, Esq.
PRONSKE & PATEL, P.C.
2200 Ross Avenue, Suite 5350
Dallas, TX 75201
Tel: (214) 658-6500
Fax: (214) 658-6509
E-mail: gpronske@pronskepatel.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Company did not file a list of creditors together with its
petition.
The petition was signed by Roscoe F. White, III, manager.
J.C. PENNEY: Tender Offer Expiration Extended to June 4
-------------------------------------------------------
J. C. Penney Company, Inc., as co-obligor on the Notes, and J. C.
Penney Corporation, Inc., a wholly owned subsidiary of the
Company, as issuer of the Notes, announced that, in connection
with the cash tender offer to purchase any and all of JCP's
outstanding 7 1/8 percent Debentures Due 2023 and related
solicitation of consents to previously described amendments to the
indenture, as amended and supplemented, governing the Notes, JCP
has increased the tender offer consideration payable in the tender
offer from $1,300 to $1,400 per $1,000 principal amount of Notes,
has extended the expiration date of the consent solicitation from
May 13, 2013, to May 20, 2013, at 5:00 p.m., New York City time,
and has extended the expiration of the tender offer from May 28,
2013, to June 4, 2013, at 11:59 p.m., New York City time.
As a result, holders of Notes that have validly tendered their
Notes prior to the Consent Expiration, as extended, will be
eligible to receive total consideration of $1,450 per $1,000
principal amount of Notes, which consists of the Tender Offer
Consideration plus a consent payment in an amount equal to $50 per
$1,000 principal amount of Notes. Holders of Notes that validly
tender their Notes after the Consent Expiration, as extended, but
prior to the Expiration Time, as extended, will be eligible to
receive only the Tender Offer Consideration. Holders whose Notes
are accepted for purchase in the tender offer will also receive
accrued and unpaid interest to, but not including, the applicable
payment date for the Notes. Holders of Notes who validly tender
their Notes pursuant to the tender offer will be deemed to consent
to the Proposed Amendments.
Tendered Notes may no longer be withdrawn. Holders who have
previously tendered (and have not validly withdrawn) their Notes
do not need to re-tender their Notes or take any other action in
order to receive the increase in the Tender Offer Consideration.
JCP may, but is not required to, select an initial settlement date
for Notes validly tendered prior to the Consent Expiration, which
would be a business day it chooses following both the Consent
Expiration and the satisfaction or waiver of the conditions to the
consummation of the tender offer and consent solicitation.
If JCP does not receive sufficient consents to effect the Proposed
Amendments, JCP currently intends to satisfy and discharge under
the Indenture any and all Notes not tendered, though there is no
guarantee JCP will effect such satisfaction and discharge.
Goldman, Sachs & Co. is acting as dealer manager and solicitation
agent for the tender offer and consent solicitation. Questions
regarding the tender offer and consent solicitation may be
directed to Goldman, Sachs & Co. at (800) 828-3182 (toll-free) or
(212) 902-5183 (collect).
D.F. King & Co., Inc. is acting as tender and information agent
for the tender offer and consent solicitation. Requests for copies
of the Offer Documents may be directed to D.F. King & Co., Inc. at
(212) 269-5550 (banks and brokers) or (800) 290-6427 (toll-free).
About J.C. Penney
Plano, Texas-based J.C. Penney Company, Inc. is one of the U.S.'s
largest department store operators with about 1,100 locations in
the United States and Puerto Rico.
J.C. Penney disclosed a net loss of $985 million in 2012, as
compared with a net loss of $152 million in 2011. The Company's
balance sheet at Feb. 2, 2013, showed $9.78 billion in total
assets, $6.61 billion in total liabilities and $3.17 billion in
total stockholders' equity.
* * *
As reported by the TCR on May 2, 2013, Moody's Investors Service
downgraded the long term ratings of J.C. Penney Company, Inc.,
including its Corporate Family Rating to Caa1 from B3. The
downgrade follows JCP's announcement that it had entered into
a commitment letter with Goldman Sachs under which Goldman Sachs
has committed to provide a $1.75 billion senior secured term loan.
Early in March 2013, Standard & Poor's Ratings Services lowered
its corporate credit rating on Penney to 'CCC+' from 'B-'. The
outlook is negative. At the same time, S&P lowered the issue-
level rating on the company's unsecured debt to 'CCC+' from 'B-'
and maintained its '3' recovery rating on this debt, indicating
S&P's expectation of meaningful (50% to 70%) recovery for
debtholders in the event of a payment default.
"The downgrade reflects the performance erosion that has
accelerated throughout the previous year and seems likely to
persist over the next 12 months," explained Standard & Poor's
credit analyst David Kuntz.
At the same time, Fitch Ratings downgraded the Company's Issuer
Default Ratings to 'B-' from 'B'. The Rating Outlook is Negative.
The rating downgrades reflect Fitch's concerns that there is a
lack of visibility in terms of the Company's ability to stabilize
its business in 2013 and beyond after a precipitous decline in
revenues leading to negative EBITDA of $270 million in 2012.
Penney, Fitch said, will need to tap into additional funding to
cover a projected FCF shortfall of $1.3 billion to $1.5 billion in
2013, which could begin to strain its existing sources of
liquidity.
In February 2013, Penney received a notice of default from a law
firm representing more than 50% of its 7.4% Debentures due 2037.
The Company has filed a lawsuit in Delaware Chancery Court seeking
to block efforts by the bondholder group to declare a default on
the 2037 bonds. Penney also asked lawyers at Brown Rudnick LLP to
identify the investors they represent.
In March 2013, Penney received a letter from bondholders
withdrawing and rescinding the Notice of Default.
On April 12, 2013, Penney borrowed $850 million out of its $1.85
billion committed revolving credit facility with JPMorgan Chase
Bank, N.A., as Administrative Agent, and Wells Fargo Bank,
National Association, as LC Agent. Penney said the move was to
enhance the Company's financial flexibility and position.
JEFFERIES LOANCORE: S&P Assigns 'B+' Issuer Credit Rating
---------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B+'
issuer credit rating on Jefferies LoanCore LLC (JLC). The outlook
is stable. S&P also assigned a 'B' rating on Jefferies Finance
LLC and JLC Finance Corp.'s proposed issuance of $250 million in
senior unsecured notes.
"Our rating on JLC reflects the company's short operating history
and concentration in commercial real estate, capital base that
fluctuates substantially from quarter to quarter, and dependence
on repurchase agreement funding facilities," said Standard &
Poor's credit analyst Brendan Browne. "The credit and
distribution support the company's joint venture owners provide
and favorable market conditions for CRE originators are positive
rating factors." To arrive at the 'B+' issuer credit rating, S&P
adds one notch to its 'b' stand-alone credit profile on JLC
because it believes one of its owners, Jefferies Group LLC
(Jefferies), would support the entity under some circumstances of
stress.
Greenwich, Conn.-based JLC originates and sells CRE loans into the
securitization market. Founded in 2011, the company has a short
operating history and less than 50 employees, and it relies
heavily on third parties for many of its accounting, finance,
legal, and back-office functions. Jefferies and GICRE, an
affiliate of Singapore's sovereign wealth fund (Government of
Singapore Investment Corp.), each owns 48.5% of JLC and control
most of the company's board and credit committee. Management and
other investors own the remaining 3%.
The stable outlook on JLC reflects S&P's expectation that the
company will continue to generate strong earnings over the next
year without significantly loosening its underwriting standards.
For instance, S&P expects the company to continue to primarily
underwrite loans at LTV ratios of about 65%-75% and to maintain
mezzanine loans at no higher than roughly 10% of total loans. S&P
also expects the company to maintain at least $300 million of
total equity, subject to any losses, and to contribute loans to
its fourth securitization by the end of May 2013 at a spread not
materially lower than it earned on its first three
securitizations.
S&P could lower its rating on JLC if the company fails to meet any
of those expectations, particularly if it begins to take on more
risk through loans with higher LTV ratios or more mezzanine loans.
S&P also would likely lower the rating if Jefferies or GICRE
looked to terminate their equity commitment in the company.
S&P could raise its rating on JLC if it builds a higher level of
permanent capital, further diversifies and improves its funding,
and develops a longer track record of profitability.
JEVIC TRANSPORTATION: Court Trims Claims in WARN Act Class Suit
---------------------------------------------------------------
Jevic Transportation, Inc., Jevic Holding Corp., and Creek Road
Properties LLC filed voluntary petitions in U.S. Bankruptcy Court
for the District of Delaware under Chapter 11 of the Bankruptcy
Code on May 20, 2008.
Casimir Czyzewski, Melvin L. Myers, Jeffrey Oehlers, Arthur E.
Perigard, and Daniel C. Richards, on behalf of themselves and all
others similarly situated, filed an amended class action complaint
(Adv. Proc. No. 08-50662) against the Debtors and Sun Capital
Partners, Inc., the Debtors' ultimate parent, alleging WARN Act
and New Jersey WARN Act violations for failing to provide
employees with the requisite 60-day notice before a plant closing
or mass layoff. The Court certified the class and directed the
named Plaintiffs as the class representatives.
On September 26, 2012, Sun Cap filed a motion for summary judgment
arguing that it cannot be held liable under either the WARN Act or
the New Jersey WARN Act because it did not employ the Class
Plaintiffs, cannot be characterized as a "single employer" with
the Debtors, and cannot be held liable for actions of any other
Sun Cap entities. In response, the Class Plaintiffs filed a
motion for partial summary judgment on October 16, 2012, arguing
that Sun Cap was a "single employer" with the Debtors, and as
such, is liable under the WARN Act and the New Jersey WARN Act.
The Class Plaintiffs also filed a separate motion for summary
judgment on November 15, 2012, arguing that the Debtors are liable
under the WARN Act and the New Jersey WARN Act because they did
not give employees sufficient notice of termination and further
contending that the Debtors cannot demonstrate that they should be
excused from complying with these statutes.
On May 10, 2013, Judge Brendan Linehan Shannon granted Sun Cap's
motion for summary judgment and denied the Class Plaintiffs'
partial summary judgment motion.
"The Court finds that there is no genuine dispute of material fact
that Sun Cap was not a "single employer" for purposes of the Class
Plaintiffs' claims under the WARN Act and the New Jersey WARN
Act," Judge Shannon said. "The record reflects that Sun Cap and
the Debtors operated two distinct and separate businesses that
were not dependent on each other. It is undisputed that Jevic
maintained separate books and records, had its own bank accounts,
and prepared its own financial statements. . . The Court is
satisfied, and the record reflects, that there is no unity of
personnel policies between the Debtors and Defendant Sun Cap," he
added.
In a separate ruling, Judge Shannon granted in part and denied in
part the Class Plaintiffs' November 15 Summary Judgment Motion,
holding that the Debtors are insulated from liability by the
Unforeseeable Business Circumstances exception to the WARN Act.
According to Judge Shannon, it is undisputed that the Debtors
violated the WARN Act by not providing its employees with the
required 60-day notice before terminating its employees. However,
the WARN Act provides for certain exceptions to the 60-day notice
requirement. Specifically, he continued, the WARN Act provides
that "[a]n employer may order a plant closing or mass layoff
before the conclusion of the 60-day period if the closing or mass
layoff is caused by business circumstances that were not
reasonably foreseeable as of the time that notice would have been
required."
Having exhausted all of its options in financing and after CIT's
refusal to extend a forbearance under the parties' credit
facility, the Debtors then had no other choice but to file for
bankruptcy, Judge Shannon said. He added that the Debtors'
layoffs were caused by CIT's refusal to extend forbearance. Thus,
"the Court finds that . . . the Debtors are entitled to the
Unforeseeable Business Circumstances exception," he said.
While the Court finds that the Debtors satisfy the Unforeseeable
Business Circumstances exception under the federal WARN Act, there
is no such exception under the New Jersey WARN Act, Judge Shannon
added. Therefore, the Court ruled that the Class Plaintiffs are
entitled to recovery under the New Jersey WARN Act.
The case is Casimir Czyzewski, Melvin L. Myers, Jeffrey Oehlers,
Arthur E. Perigard, and Daniel C. Richards, on behalf of
themselves and all others similarly situated, Plaintiffs, v.
Jevic Transportation, Inc., Jevic Holding Corp., Creek Road
Properties, LLC, Sun Capital Partners, Inc., and John Does 1-10,
Defendants, Adv. Proc. No. 08-50662.
A copy of the Bankruptcy Court's May 10, 2013 Opinions are
available at http://is.gd/oBoy0nand http://is.gd/NFFNTXfrom
Leagle.com.
About Jevic Transportation
Based in Delanco, New Jersey, Jevic Transportation Inc. --
http://www.jevic.com/-- provided trucking services. Two
affiliates -- Jevic Holding Corp. and Creek Road Properties --
have no assets or operations. Jevic et al. sought Chapter 11
protection (Bankr. D. Del. Case No. 08-11008) on May 20, 2008.
Domenic E. Pacitti, Esq., and Michael W. Yurkewicz, Esq., at Klehr
Harrison Harvey Branzburg & Ellers, in Wilmington, Del., represent
the Debtors. The U.S. Trustee for Region 3 appointed five
creditors to serve on an Official Committee of Unsecured
Creditors. Robert J. Feinstein, Esq., Bruce Grohsgal, Esq., and
Maria A. Bove, Esq., at Pachulski Stang Ziehl & Jones LLP, in
Wilmington, Del., represent the Official Committee of Unsecured
Creditors.
Before filing for bankruptcy, the Debtors initiated an orderly
wind-down process. As a part of the wind-down process, the
Debtors ceased substantially all of their business and
terminated roughly 90% of their employees. The Debtors continue
to manage the wind-down process in an attempt to deliver all
freight in their system and to retrieve their assets.
When the Debtors sought protection from their creditors, they
estimated assets and debts between $50 million and $100 million.
At Oct. 31, 2010, the Debtor had total assets of $424,567, total
liabilities of $12.2 million, and a stockholders' deficit of
$11.8 million. The Debtor ended the period with $362,104 in cash,
which includes restricted cash of $66,977.
KIT DIGITAL: Shareholders Have Alternative to Prepack
-----------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Kit Digital Inc. shareholders and a prospective buyer
are seeking to derail a prepackaged Chapter 11 reorganization
begun April 25 under which a group of shareholders including the
company's chief executive officer would buy the developer of
software for digital-video management.
According to the report, the company's plan calls for three
existing shareholders to pay $25 million for 89.3 percent of the
stock. The shareholders are Prescott Group Capital Management,
JEC Capital Partners and Stichting Bewaarder Ratio Capital
Partners. According to an ad hoc group of other stockholders, JEC
is a private-equity investor affiliated with Kit's CEO.
The report relates that an ad hoc group owning 1.4 million Kit
shares filed papers objecting to $3 million in financing provided
by one of the buyers.
The ad hoc shareholder group said in a court paper that it has a
proposal for an alternative plan giving a higher recovery on
existing equity without requiring stockholders to make a new
investment.
Irdeto BV, a creditor and stockholder, also filed papers opposing
the financing and plan-support agreement. Netherlands-based
Irdeto said it made an offer with more than $10 million in
additional cash which the company turned down. Irdeto is also
opposing the approval of $2.5 million in fees to the insiders that
would limit the ability to obtain other offers. Irdeto opposes a
so-called no-shop clause in the plan-support agreement precluding
Kit from seeking other bids.
The report relates that if the acquisition from the insider group
goes ahead, the $3 million loan will be converted into 10.7
percent of the equity when the plan is implemented. The group
would pay $25 million in cash for the other 89.3 percent. The
insider group is offering existing shareholders 30-day warrants to
purchase stock at the same price as the three buyers. Half of
proceeds from exercise of warrants will go to the buyers, with the
other half used for working capital. Unsecured creditors would be
paid in full, without interest. Plaintiffs in securities lawsuits
would be limited to recoveries from insurance, if any.
A May 20 hearing was set both to approve the loan and the so-
called plan-support agreement outlining the acquisition worked out
before the Chapter 11 filing.
About KIT digital
New York-based KIT digital Inc. -- http://www.kitd.com/-- is a
video management software and services company. KIT digital
services nearly 2,500 clients in 50+ countries including some of
the world's biggest brands, such as Airbus, The Associated Press,
AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky
Deutschland, Sky Italia, Telecom Argentina, Telecom Italia,
Telefonica, Universal Studios, Verizon, Vodafone VRT and
Volkswagen.
KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case
No. 13-11298) in Manhattan on April 25, 2013k, estimating more
than $10 million in both assets and debts.
KIT's operating subsidiaries, including Ioko 365, Polymedia,
Kewego, Multicast and Megahertz are not included in the Chapter 11
filing.
Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell &
Giuliani LLP, in New York, serve as counsel to the Debtor.
American Legal Claims Services LLC is the claims and noticing
agent and the administrative agent.
KRONOS WORLDWIDE: Moody's Affirms 'Ba2' Corp. Family Rating
-----------------------------------------------------------
Moody's Investors Service moved Kronos Worldwide Inc.'s
Speculative Grade Liquidity rating to SGL-3 from SGL-1. The change
reflects the potential that Kronos will not meet one of its
financial covenants under its term loan or revolving credit
facility agreements. Moody's also affirmed the company's Ba2
Corporate Family Rating and stable outlook due to the significant
reduction in its term loan in the first quarter of 2013.
Kronos Worldwide Inc.
Speculative Grade Liquidity assessment to SGL-3 from SGL-1
Ratings affirmed:
Corporate Family Rating at Ba2
Probability of Default Rating at Ba2-PD
Senior Secured Term Loan B due 2019 at Ba3 (LGD5, 76%) from Ba3
(LGD4, 66%)
Outlook -- Stable
Ratings Rationale:
The Speculative Grade Liquidity rating (which reflects adequate
liquidity) for Kronos was moved to SGL-3 from SGL-1 due to the
decline in the firm's first quarter 2013 profit margins and cash
flows, as well as the potential that it may not generate
sufficient EBITDA in 2013 to meet its maximum leverage covenant
under its term loan. However, Kronos recently repaid $290 million
of its term loan leaving $100 million remaining outstanding and
balance sheet cash of $102 million at the end of the first quarter
of 2013.
Titanium dioxide industry margins (and Kronos' margins) were
negatively impacted in the second half of 2012 by additional
exports from China and a decline in demand, which caused prices to
decline by roughly 21% in Q1 2013 versus the prior year quarter.
Additionally, ore prices increased significantly squeezing
margins. In the first quarter of 2013, Kronos' gross profit
plummeted to $4 million, a 99% decline from the prior year level,
despite record sales volumes. Moody's believes that many TiO2
customers have taken advantage of the lower prices and have
started rebuilding inventories, accounting for Kronos' record
volumes. Given the additional inventories in the channel, it is
difficult to predict the degree to which Kronos' margins will
rebound in the second and third quarter; and if profits will be
sufficient for Kronos to meet its term loan financial covenant
(maximum net debt / EBITDA of 3.50x). Should the company not meet
the term loan financial covenant, the agreement has a six month
forbearance clause which would delay a default under the agreement
or the acceleration of the debt.
Kronos had $300 million of debt as of March 31, 2013. In the first
quarter, Kronos borrowed $190 million from its indirect parent
Contran Corporation and used balance sheet cash to reduce
outstandings under the term loan to $100 million from $390
million. Kronos had $102 million of cash at March 31, 2013, and
access to a EUR120 million revolving credit facility ($13 million
drawn as of March 31, 2013). The firm is likely to remain in
compliance the financial covenants in its European facility (Net
Secured Debt/EBITDA and Net Financial Debt/Equity). Additionally,
the company has the ability to borrow an additional $100 million
from Contran, subject to their approval. Between its balance sheet
cash, the European revolver and the Contran facility, Moody's
believes that Kronos has sufficient liquidity to navigate this
unusually severe downturn in its financial performance. Kronos
also has access to a $125 million revolver in the US which has a
financial covenant requiring it to maintain a fixed charge
coverage ratio in excess of 1.0x, if drawn above a certain level.
However, Moody's is concerned that it may not be able to remain in
compliance with the financial covenant in this facility in 2013.
The stable outlook reflects Moody's expectations that Kronos's
profit margins will return to more reasonable levels in the second
half of 2013, but remain well below its performance in 2012.
Should sales volumes and/or prices decline in the second quarter,
Moody's would likely move to a negative outlook.
The principal methodology used in this rating was the Global
Chemical Industry Methodology published in December 2009. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Kronos Worldwide, Inc., headquartered in Dallas, TX, produces and
markets TiO2 pigments in the U.S., Canada and Europe. The company
reported sales of $1.9 billion for the twelve months ended March
31, 2013.
LMK PROPERTIES: Case Summary & 3 Unsecured Creditors
----------------------------------------------------
Debtor: LMK Properties, Inc.
4820 N. Leonard Dr.
Norridge, IL 60706
Bankruptcy Case No.: 13-19873
Chapter 11 Petition Date: May 10, 2013
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Eugene R. Wedoff
Debtor's Counsel: Ben L Schneider, Esq.
SCHNEIDER & STONE
8424 Skokie Blvd., Suite 200
Skokie, IL 60077
Tel: (847) 933-0300
Fax: (847) 676-2676
E-mail: ben@windycitylawgroup.com
Scheduled Assets: $1,061,700
Scheduled Liabilities: $510,200
A copy of the Company's list of its largest unsecured creditors,
filed together with the petition, is available for free at
http://bankrupt.com/misc/ilnb13-19873.pdf
The petition was signed by Michael Levine, president.
LODGE PARTNERS: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Lodge Partners, LLC
dba Lodge On The Desert
7114 East Stetson Drive Suite 205
Scottsdale, AZ 85251
Bankruptcy Case No.: 13-07952
Chapter 11 Petition Date: May 12, 2013
Court: United States Bankruptcy Court
District of Arizona (Tucson)
Judge: Eileen W. Hollowell
Debtor's Counsel: Michael W. Mcgrath, Esq.
Kasey C. Nye, Esq.
MESCH CLARK & ROTHSCHILD
259 North Meyer Avenue
Tucson, AZ 85701-1090
Tel: (520) 624-8886
Fax: (520) 798-1037
E-mail: ecfbk@mcrazlaw.com
knye@mcrazlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $10,000,001 to $50,000,000
A copy of the Company's list of its 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/azb13-7952.pdf
The petition was signed by Daniel J. Donahoe III, president.
MACKINAW POWER: Fitch Affirms 'BB-' Rating on $147MM Secured Loan
-----------------------------------------------------------------
Fitch Ratings has affirmed the 'BBB-' rating on Mackinaw Power,
LLC's $288.9 million ($200 million outstanding) senior secured
bonds (senior bonds), and affirms the 'BB-' rating on Mackinaw
Power Holdings, LLC's $147 million ($114 million outstanding)
senior secured term loan (term loan). The ratings affirmations and
Stable Outlooks are based on continued stable operational
performance and the addition of new tolling agreements at two
generation units.
KEY RATING DRIVERS
-- Substantially Contracted Portfolio: The facilities are nearly
fully contracted under tolling agreements with investment-grade
off-takers through 2015. Beyond 2015, approximately 75% of
total portfolio capacity is contracted through the senior notes
maturity in 2023. There is adequate cost recovery for
operations and fuel under the contracts based on dispatch.
-- Stable Historical Performance: Plants utilize conventional
technology and proven natural-gas fired generation with
operational and maintenance risk diversified across the four
facilities. Operating costs, heat rates, and availability have
been consistent with expectations.
-- Adequate Supply: Fuel supply is provided by investment-grade
off-takers.
-- Investment-Grade Senior Bonds Profile: Mackinaw receives
distributions from facilities with no project-level debt.
Although cash flow is expected to come from both contracted and
non-contracted sources during the term of the bonds, debt
service coverage is evaluated using contracted-only cash flows.
Fitch projects a contracted-only DSCR average of 1.73x,
consistent with the senior bonds rating.
-- Manageable Refinance Risk: Fitch expects a bullet refinancing
of approximately $100 million upon maturity of the term loan at
MPH. Refinance risk is mitigated by adequate residual cash flow
from Mackinaw to MPH in Fitch's refinancing case.
RATING SENSITIVITIES
-- Owner decision to transfer the Effingham and/or Washington
(units 1 and 4) from Mackinaw to MPH;
-- Contract renewal or replacement at the Effingham facility;
-- Significant shift in the regional merchant power market;
-- Material change in the cost profile of the portfolio;
-- Substantial deviation in term loan principal amortization
relative to projected levels.
SECURITY
The notes are secured by a perfected first priority security
interest in all tangible and intangible assets of Mackinaw and the
Project Companies, the membership interests in Mackinaw held by
MPH, the debt service reserve and the major maintenance reserve.
The term loan is secured by a perfected first priority security
interest in all tangible and intangible assets of MPH, and the
letter of credit-funded debt service reserve.
CREDIT UPDATE
The ratings affirmations for the senior bonds and term loan are
based on continued stable operational performance of the portfolio
and the addition of new tolling agreements at two generation units
(Washington 1 and 4). The tolling agreements were signed with two
Georgia cooperatives whose credit quality is not a constraint on
the ratings. These agreements begin in 2016 and add a material
amount of contracted cash flow to the portfolio.
Under Fitch's rating case, which applies a combination of stresses
to costs, availability, and heat rates across the portfolio,
contracted cash flows are sufficient to reach the investment-grade
threshold. With the addition of Washington 1 and 4's new
agreements, the average DSCR for the senior bonds is 1.73x, with a
minimum of 1.32x in 2015.
Fitch notes that the indenture permits the option to transfer
Washington 1 and 4 and the Effingham facility to MPH in late 2015.
Under a scenario in which these assets are transferred out of the
senior bonds cash flow, the DSCR average could fall to 1.34x and
could warrant negative rating action. This flexibility to move
some assets directly to MPH in 2015 could also reduce refinance
risk for the term loan.
The term loan rating reflects consolidated debt service coverage
for both principal and interest on the senior bonds and interest
payments on the structurally subordinated term loan under Fitch's
combined stress rating case. From 2013-2015, the term loan
consolidated DSCR averages 1.16x, with a minimum of 1.10x. Fitch
expects that principal payments on the term loan via the cash
sweep mechanism will reduce the bullet that will need to be
refinanced at maturity to approximately $100 million.
To assess refinancing risk, Fitch constructed a refinancing
scenario that assumes fixed amortization at an interest rate of 9%
over an eight-year term with debt maturing in 2023, six months
before the expiration of several tolling agreements. Fitch notes
that the tolling agreements signed at Washington 1 and 4 extend
beyond 2023, reflecting additional flexibility for refinancing the
bullet. Overall, refinancing at MPH is viewed as midrange risk.
The projects held by Mackinaw and MPH sell energy and capacity
under long-term fixed-price power purchase agreements (PPAs) with
Constellation Energy Commodities Group (owned by Exelon, IDR
'BBB+'; Stable Outlook by Fitch), Georgia Power Company (GPC, IDR
'A'; Stable Outlook), and two Georgia cooperatives. The PPAs are
structured as tolling agreements, and the off-takers are
responsible for providing natural gas fuel. PPA cash flows are the
primary source of income to the senior bonds. Excess cash flow, if
any, is distributed to MPH and used to make interest payments on
the term loan. Fifty percent of any remaining cash flow at MPH is
used for term loan principal repayments.
Equity interests in the projects are owned indirectly by majority
owner ArcLight Energy Partners Fund III, LP, as well as minority
owner affiliates of GE Capital and Government of Singapore
Investment Corporation.
MAGNA CHIROPRACTIC: Case Summary & 15 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Magna Chiropractic, LLC
2424 Airway Dr., Ste. B
Bowling Green, KY 42103
Bankruptcy Case No.: 13-10596
Chapter 11 Petition Date: May 10, 2013
Court: United States Bankruptcy Court
Western District of Kentucky (Bowling Green)
Judge: Joan A. Lloyd
Debtor's Counsel: Scott A. Bachert, Esq.
324 E 10th St., P.O. Box 1270
Bowling Green, KY 42102
Tel: (270) 782-3938
E-mail: bachert@hbmfirm.com
Estimated Assets: $50,001 to $100,001
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its largest unsecured creditors,
filed together with the petition, is available for free at
http://bankrupt.com/misc/kywb13-10596.pdf
The petition was signed by Bryan K. Hawley, member.
MAMS LLC: Case Summary & Unsecured Creditor
-------------------------------------------
Debtor: MAMS, LLC
9101 Parkers Landing
Orlando, FL 32824
Bankruptcy Case No.: 13-05976
Chapter 11 Petition Date: May 13, 2013
Court: U.S. Bankruptcy Court
Middle District of Florida (Orlando)
Judge: Karen S. Jennemann
Debtor's Counsel: C. Andrew Roy, Esq.
WINDERWEEDLE, HAINES, WARD & WOODMAN, P.A.
P.O. Box 1391
Orlando, FL 32802-1391
Tel: (407) 246-8808
Fax: (407) 423-7014
E-mail: aroy@whww.com
Scheduled Assets: $2,200,000
Scheduled Liabilities: $3,136,884
The petition was signed by Cheryl Leonard, managing member.
The Company's list of its largest unsecured creditors filed with
the petition contains only one entry:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Florida Department of Revenue
Maitland Service Center
2301 Maitland Center Parkway, Suite 160
Maitland, FL 32751-4192
MEDIACOM BROADBAND: S&P Assigns 'BB-' Rating to $450MM Term Loan
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' issue-level
rating and '2' recovery rating to the proposed $450 million term
loan H due 2021 issued by Mediacom Broadband Group
(B+/Positive/--). The '2' recovery rating indicates S&P's
expectations of substantial (70% to 90%) recovery for lenders in
the event of a payment default. The issuer is a subsidiary of
Middletown, N.Y.-based cable-TV operator Mediacom Communications
Corp. (B+/Positive/--). S&P expects proceeds, along with modest
revolver borrowings, will be used to repay a portion of the
company's term loan F under its existing bank credit facility due
2017. As a result, S&P expects adjusted leverage to remain
unchanged, at about 5.8x as of March 31, 2013, which under its
base-case scenario, S&P believes could decline to the mid-5x area
in 2013.
Mediacom has continued to reduce the pace of video subscriber
losses in the first quarter of 2013 to 5.7%, from 6.5% in the
fourth quarter of 2012. S&P expects basic subscriber losses will
remain in the mid-single-digit percent area in 2013, partially
offset by healthy average revenue per unit (ARPU) growth due to
rate increases. Growth in data and telephone subscribers has also
continued into the first quarter (increasing 6% and 3%,
respectively), although slightly down from the fourth quarter
(7.5% and 5%, respectively). Similar to peers, the company is
benefiting from healthy growth in data and business services
revenue, which increased 9% and 20%, respectively, in the first
quarter. As a result of these trends, S&P expects low-single-
digit percent total revenue growth in 2013, and relatively stable
EBITDA margins. The positive outlook reflects the potential for
an upgrade this year if operating metrics continues at current
trends and S&P believes leverage will decline below 5.5x and
remain at that level on a sustained basis. Assuming low-single-
digit percent EBITDA growth and modest debt repayment, S&P
believes that it can achieve these credit measures in 2013. An
upgrade scenario would also incorporate S&P's view on the
company's financial policy.
RATINGS LIST
Mediacom Broadband Group
Mediacom Communications Corp.
Corporate Credit Rating B+/Positive/--
New Rating
Mediacom Broadband Group
$450 Mil. Term Loan H Due 2021 BB-
Recovery Rating 2
METEX MFG: Seeks to Participate in The Home Liquidation Proceeding
------------------------------------------------------------------
Metex Mfg. Corporation, f/k/a Kentile Floors, Inc., seeks
authority from the U.S. Bankruptcy Court for the Southern District
of New York to use estate assets to seek intervention and
participate in a disputed claims proceeding for the purpose of
protecting their interest in certain insurance policies issued by
The Home Insurance Company that provide coverage for asbestos
personal injury claims against Kentile Floors, Inc.
Kentile has coverage under five umbrella insurance policies issued
by The Home. Each of The Home Policies has a $5 million limit,
excess of five now exhausted $1 million primary policies, bringing
the total aggregate limits of The Home Policies to $25 million.
The Home Policies provide coverage for Kentile asbestos personal
injury claims.
In 2003, The Home became, and remains, the subject of a
liquidation proceeding in the Merrimack County Superior Court,
State of New Hampshire. Roger A. Sevigny, the Commissioner of the
Insurance for the State of New Hampshire, was appointed by the
Superior Court as the liquidator for The Home. On June 10, 2004,
Metex filed a timely proof of claim in The Home Liquidation
Proceeding seeking insurance coverage for, inter alia, the
asbestos personal injury claims that have been made against
Kentile.
The Debtor relates that there is a pending claims dispute in The
Home Liquidation Proceeding, which could result to the impairment
of the limits of The Home Policies and, therefore, result in a
dollar for dollar reduction in the amount that will be paid by to
the Debtor.
A hearing on the request will be held on June 5, 2013. Objections
are due May 29.
About Metex
Great Neck, New York-based Metex Mfg. Corporation, formerly known
as Kentile Floors, Inc., started business in the late 1800's as a
manufacturer of cork tile, and thereafter progressed to making
composite tile for commercial and residential use. It filed for
Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 12-
14554) on Nov. 9, 2012. The petition was signed by Anthony J.
Miceli, president. The Debtor estimated its assets and debts at
$100 million to $500 million. Judge Burton R. Lifland presides
over the case.
Affiliate Kentile Floors, Inc., filed a separate Chapter 11
petition (Bankr. S.D.N.Y. Case No. 92-46466) on Nov. 20, 1992.
Caplin & Drysdale, Chartered, represents the Official Committee of
unsecured Creditors in the Debtor's case.
MF GLOBAL: Wins Court Approval of NY-717 Fifth Settlement
---------------------------------------------------------
U.S. Bankruptcy Judge Martin Glenn approved the agreement between
MF Global Holdings Ltd.'s trustee and NY-717 Fifth Avenue LLC.
The agreement resolves a dispute between the companies over
whether NY-717 timely filed two separate claims against MF Global
and MF Global Holdings USA Inc. Under the deal, both sides agreed
that NY-717 timely filed a $20.625 million general unsecured claim
against each of the companies.
The claims stemmed from a 2007 contract, which allowed MF Global
Holdings USA to lease office space from NY-717. The lease was
guaranteed by the MF Global parent.
About MF Global
New York-based MF Global -- http://www.mfglobal.com/-- was one of
the world's leading brokers of commodities and listed derivatives.
MF Global provides access to more than 70 exchanges around the
world. The firm also was one of 22 primary dealers authorized to
trade U.S. government securities with the Federal Reserve Bank of
New York. MF Global's roots go back nearly 230 years to a sugar
brokerage on the banks of the Thames River in London.
On Oct. 31, 2011, MF Global Holdings Ltd. and MF Global Finance
USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 11-15059 and 11-5058), after a planned sale to
Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF
Global had $41,046,594,000 in total assets and $39,683,915,000 in
total liabilities.
On Nov. 7, 2011, the United States Trustee appointed the statutory
creditors' committee in the Debtors' cases. At the behest of the
Statutory Creditor's Committee, the Court directed the U.S.
Trustee to appoint a chapter 11 trustee. On Nov. 28, 2011, the
Bankruptcy Court entered an order approving the appointment of
Louis J. Freeh, Esq., of Freeh Group International Solutions, LLC,
as Chapter 11 trustee.
On Dec. 19, 2011, MF Global Capital LLC, MF Global Market Services
LLC and MF Global FX Clear LLC filed voluntary Chapter 11
petitions (Bankr. S.D.N.Y. Case Nos. 11-15808, 11-15809 and
11-15810). On Dec. 27, the Court entered an order installing Mr.
Freeh as Chapter 11 Trustee of the New Debtors.
On March 2, 2012, MF Global Holdings USA Inc. filed a voluntary
Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-10863), and Mr.
Freeh also was installed as its Chapter 11 Trustee.
Judge Honorable Martin Glenn presides over the Chapter 11 case.
J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric
Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve
as bankruptcy counsel. The Garden City Group, Inc., serves as
claims and noticing agent. The petition was signed by Bradley I.
Abelow, Executive Vice President and Chief Executive Officer of MF
Global Finance USA Inc.
The Chapter 11 Trustee has tapped (i) Freeh Sporkin & Sullivan
LLP, as investigative counsel; (ii) FTI Consulting Inc., as
restructuring advisors; (iii) Morrison & Foerster LLP, as
bankruptcy counsel; and (iv) Pepper Hamilton as special counsel.
The Official Committee of Unsecured Creditors has retained
Capstone Advisory Group LLC as financial advisor, while lawyers at
Proskauer Rose LLP serve as counsel.
The Securities Investor Protection Corporation commenced
liquidation proceedings against MF Global Inc. to protect
customers. James W. Giddens was appointed as trustee pursuant to
the Securities Investor Protection Act. He is a partner at Hughes
Hubbard & Reed LLP in New York.
Jon Corzine, the former New Jersey governor and co-CEO of
Goldman Sachs Group Inc., stepped down as chairman and chief
executive officer of MF Global just days after the bankruptcy
filing.
In April 2013, the Bankruptcy Court approved MF Global Holdings'
plan to liquidate its assets. Bloomberg News reported that the
court-approved disclosure statement initially told
creditors with $1.134 billion in unsecured claims against the
parent holding company why they could expect a recovery of 13.4%
to 39.1% from the plan. As a consequence of a settlement with
JPMorgan, supplemental materials informed unsecured creditors
their recovery was reduced to the range of 11.4% to 34.4%. Bank
lenders will have the same recovery on their $1.174 billion claim
against the holding company. As a consequence of the settlement,
the predicted recovery became 18% to 41.5% for holders of $1.19
billion in unsecured claims against the finance subsidiary,
one of the companies under the umbrella of the holding company
trustee. Previously, the predicted recovery was 14.7% to 34% on
bank lenders' claims against the finance subsidiary.
MIDTOWN SCOUTS: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Midtown Scouts Square Property, LP
8305 Knight Road
Houston, TX 77054
Bankruptcy Case No.: 13-32920
Affiliate that filed separate Chapter 11 petition:
Entity Case No.
------ --------
Midtown Scouts Square, LLC 13-32924
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Southern District of Texas (Houston)
Judge: Karen K. Brown
Debtors' Counsel: T. Josh Judd, Esq.
HOOVER SLOVACEK, LLP
5847 San Felipe, Suite 2200
Houston, TX 77057
Tel: (713) 735-4165
Fax: (713) 977-5395
E-mail: judd@hooverslovacek.com
- and ?
Edward L. Rothberg, Esq.
HOOVER SLOVACEK, LLP
5847 San Felipe, Suite 2200
Houston, TX 77057
Tel: (713) 977-8686
Fax: (713) 977-5395
E-mail: rothberg@hooverslovacek.com
MSS Property's Estimated Assets: $10,000,001 to $50,000,000
MSS Property's Estimated Debts: $10,000,001 to $50,000,000
MSS LLC's Estimated Assets: $0 to $50,000
MSS LLC's Estimated Debts: $10,000,001 to $50,000,000
The petitions were signed by Erich Mundinger, president of general
partner.
A. A copy of Midtown Scouts Square, LLC's list of its 20 largest
unsecured creditors filed with the petition is available for free
at:
http://bankrupt.com/misc/txsb13-32924.pdf
B. Midtown Scouts Square Property's List of Its 20 Largest
Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Richey Family Limited Partnership -- $1,400,000
P.O. Box 2569
Stafford, TX 77497
Hicham Nafaa, Ali Bendella, and -- $436,000
Neptunes Restaurant, LLC
c/o Daniel D. Horowitz, III
800 Commerce Street
Houston, TX 77002-1776
Wholesale Restaurant Supply -- $81,999
1949 Single Road
Houston, TX 77055
Harrell Architects -- $34,403
BlackFinn American Grille Security Deposit $25,305
Trio Electric Ltd. -- $15,193
Lone Star Advantage -- $10,199
Discovery Construction -- $8,793
Summit Landscaping Services, Inc. -- $7,361
US Canvas & Awning Corporation -- $6,319
Scott Youngblood CPA -- $6,000
Cueto, James -- $4,736
Greenberg Traurig -- $3,941
State Parking Services, Inc. -- $2,883
Krenek Architects, Inc. -- $1,950
Associated Time & Parking -- $1,435
Controls
Belknap Concrete Cutting -- $1,353
and Drilling
AWP Services -- $875
Allied Waste Services -- $785
Pyrotex Systems, Inc. -- $350
MILAGRO OIL: Commences Private Exchange Offer for 10.500% Notes
---------------------------------------------------------------
Milagro Oil & Gas, Inc., Vanquish Energy, LLC, a newly formed
Delaware limited liability company to which Milagro will transfer
substantially all of its assets in connection with the
consummation of the Exchange Offer, and Vanquish Finance, Inc., a
Delaware corporation on May 17 disclosed that they have commenced
a private exchange offer to exchange any and all of Milagro's
outstanding 10.500% Senior Secured Second Lien Notes due 2016
issued under the Indenture dated as of May 11, 2010 among Milagro,
the guarantors party thereto and Wells Fargo Bank, N.A., as
Trustee, for either (i) Class A Units of Vanquish and 10.500%
Senior Secured Second Lien Notes due 2017 of the Issuers or (ii)
cash for up to a maximum of $65.0 million aggregate principal
amount of the Old Notes, all on the terms and subject to the
conditions as set forth in a confidential offering circular and
consent solicitation statement. In connection with the Exchange
Offer, Milagro is soliciting consents from holders of the Existing
Notes to certain proposed amendments to the Indenture.
The following table sets forth the material economic terms of the
Exchange Offer:
Notes to be CUSIP No. Outstanding Prior to the
Consent
Exchanged
10.500% Senior
Secured Second
Lien Notes due 2016 59870W AB8 $250,000,000
Consideration per $1,000
Principal Amount of
Old Notes Tendered
Prior to the Consent On or After the Consent
Date
Date
$500 principal amount of New Notes $475 principal amount of New
Notes AND
500 Class A Units 475 Class A Units
OR OR
$750 in cash $700 in cash
Eligible holders who tender their Old Notes and deliver their
Consents (as defined below) by 5:00 P.M., New York City time, on
May 31, 2013, unless extended by Milagro, will receive additional
consideration as described in the table above if their Old Notes
are accepted for payment.
The maximum aggregate principal amount of Old Notes that may be
tendered for cash in the Exchange Offer is an amount equal to the
greater of (i) $40.0 million and (ii) the lesser of (a) $65.0
million and (b) $40.0 million, plus the amount by which the
aggregate New Capital Investment exceeds $130.0 million multiplied
by 1.33. In the event that the aggregate principal amount of Old
Notes validly tendered for cash exceeds the Cash Limit, then the
cash option of the Exchange Offer will be oversubscribed, and, if
the Company accepts for purchase Old Notes in the Exchange Offer,
it will accept for purchase such validly tendered Old Notes for
cash on a prorated basis, with the aggregate principal amount of a
holder's validly tendered Old Notes accepted for purchase for cash
determined by multiplying such holder's tender by the proration
factor, and rounding the product down to the nearest $1,000. The
proration factor will be determined such that the aggregate
prorated principal amount of Old Notes validly tendered for cash
equals the Cash Limit. So long as the other terms and conditions
described herein are satisfied, and subject to the Cash Limit, the
Company intends to accept all Old Notes validly tendered (and not
validly withdrawn), and Proration will only occur if the aggregate
amount of Old Notes validly tendered for cash (and not validly
withdrawn) exceeds the Cash Limit. In the event of Proration,
eligible holders that have elected to receive cash will receive
New Securities in the ratio set forth in the table above (in an
amount based on whether they tender before or after the Consent
Date) for the portion of their tendered Old Notes for which they
will not receive cash. The Company does not intend to reinstate
withdrawal rights if Proration occurs. Eligible holders electing
to receive cash should be aware that in the event of Proration,
they may receive New Securities in respect of a portion of Old
Notes for which they wished to receive cash.
The New Notes will have substantially the same terms as the Old
Notes, with the exception of certain modifications described in
the Offering Circular. The New Notes will be fully and
unconditionally guaranteed by each of Newco's existing and future
material U.S. restricted subsidiaries. The New Notes are not and
will not be, however, guaranteed by Newco's foreign subsidiaries
or our unrestricted subsidiaries. The coupon on the New Notes
will be 10.500% per annum, payable 50% in cash and 50% by
increasing the aggregate principal amount of the outstanding notes
or by issuing additional New Notes.
In connection with the Exchange Offer, Milagro is soliciting
Consents from holders of the Old Notes to certain proposed
amendments, which would eliminate or waive substantially all of
the restrictive covenants contained in the Indenture and the Old
Notes themselves, release the collateral and guarantees securing
the Old Notes, eliminate certain events of default, modify
covenants regarding mergers and consolidations, and modify or
eliminate certain other provisions contained in the Indenture and
the Old Notes. Holders of the Old Notes may not tender their Old
Notes in the Exchange Offer without delivering the related
Consents and Holders may not deliver Consents in the Consent
Solicitation without tendering their Old Notes in the Exchange
Offer. Holders may revoke their Consents only by validly
withdrawing the previously tendered Old Notes to which such
Consents relate. In addition, in connection with the proposed
amendments, the guarantees of the Old Notes by the subsidiary
guarantors will be released.
The Exchange Offer is conditioned on a minimum principal amount of
at least $237.5 million of the outstanding principal amount of the
Old Notes being tendered and also on the receipt of the requisite
Consents to the proposed amendments with respect to all series of
Old Notes. The Exchange Offers are subject to certain other
conditions, as more fully described in the Offering Circular. In
addition, Milagro has the right to terminate or withdraw the
Exchange Offer at any time and for any reason, including if any of
the conditions described in the Offering Circular are not
satisfied.
Holders of approximately 66.5% of the Old Notes have agreed to
tender into the Exchange Offer, subject to certain terms and
conditions.
The Exchange Offer will expire at midnight, New York City time, on
June 14, 2013, unless any of them is extended.
Tenders in any of the Offers may be withdrawn prior to 5:00 p.m.,
New York City time, on May 31, 2013 unless extended by the
Issuers. Holders may withdraw Old Notes tendered in any of the
Offers at any time prior to the Withdrawal Deadline but holders
may not withdraw Old Notes tendered in any of the Offers, on or
thereafter. A withdrawal of Old Notes tendered in the Exchange
Offer will be deemed revocation of the related Consent. In order
for a holder to revoke a Consent delivered in connection with the
Exchange Offer, such holder must withdraw the related tender of
Old Notes.
The complete terms and conditions of the Exchange Offer and
consent solicitation are described in the Offering Circular,
copies of which may be obtained by eligible holders by contacting
D.F. King & Co., Inc., the information agent, at 48 Wall Street,
22nd Floor, New York, New York 10005, (212) 269-5550 (collect) or
(800) 290-6427 (toll free), or milagro@dfking.com
The New Notes will accrue interest from and including the
settlement date. Holders who exchange Old Notes for New Notes in
the Exchange Offer will receive accrued and unpaid interest to,
but not including, the settlement date, in the form of New Notes.
The New Securities have not been registered under the Securities
Act of 1933, as amended, and may not be offered or sold in the
United States absent registration or an applicable exemption from
the registration requirements of the Securities Act.
The Exchange Offer is being made only to qualified institutional
buyers and accredited investors and to certain non-U.S. investors
located outside the United States. The Exchange Offer is made
only by, and pursuant to, the terms set forth in the Offering
Circular and the information in this press release is qualified by
reference to the Offering Circular and the letter of transmittal
accompanying the Offering Circular. Subject to applicable law and
the consent of the Participants, Milagro may amend, extend or
terminate the Exchange Offer.
Documents relating to the Exchange Offer, including the Offering
Circular, will only be distributed to holders who complete and
return a letter of eligibility confirming that they are within the
category of eligible investors for the Exchange Offer.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any security and shall not
constitute an offer, solicitation or sale in any jurisdiction in
which such offering, solicitation or sale would be unlawful.
About Milagro
Milagro Oil & Gas, Inc. is an independent energy company based in
Houston, Texas that is engaged in the acquisition, development,
exploitation, and production of oil and natural gas. Milagro's
historic geographic focus has been along the onshore Gulf Coast
area, primarily in Texas, Louisiana, and Mississippi. Milagro
operates a significant portfolio of oil and natural gas producing
properties and mineral interests in this region and has expanded
its footprint through the acquisition and development of
additional producing or prospective properties in North Texas and
Western Oklahoma.
As reported by the Troubled Company Reporter on April 22, 2013,
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Houston-based Milagro Oil & Gas Inc. to 'CCC-'
from 'CCC'. The outlook is negative. S&P also placed the 'CCC'
rating on the company's $250 million senior secured notes on
CreditWatch with developing implications. The CreditWatch on the
notes will be resolved upon further review of the company's
reserves at year-end 2012 based on S&P's recovery price deck
assumptions.
MILL US: S&P Assigns 'B' CCR & Rates $650MM 1st-Lien Loan 'B+'
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Mill US Acquisition LLC, which will be doing
business as CSM Bakery Supplies. The outlook is stable.
At the same time, S&P assigned a 'B+' issue-level rating to the
company's proposed $650 million first-lien senior secured term
loan due 2020. The recovery rating is '2', indicating S&P's
expectation for substantial (70% to 90%) recovery for lenders in
the event of a payment default. S&P also assigned a 'CCC+' issue-
level rating to the company's proposed $200 million second-lien
senior secured term loan due 2021, with a recovery rating of '6',
indicating S&P's expectation for negligible (0% to 10%) recovery
in the event of default. The ratings are based on proposed terms
and are subject to review upon receipt of final documentation.
Proceeds from the new term loans along with equity from entities
affiliated with Rhone Capital will primarily be used to finance
the acquisition of CSM Bakery Supplies from CSM NV for an
enterprise value of EUR1,050 million. At the close of the
transaction, S&P estimates CSM Bakery Supplies will have about
$870 million in total debt outstanding.
The ratings on CSM Bakery Supplies reflect S&P's view of the
company's narrow business focus in a highly competitive and
fragmented industry, exposure to volatile commodity costs, and low
margins. Other key credit factors include the company's breadth
of product offerings within the bakery products and ingredients
markets, geographic and customer diversification, and scale as one
of the largest bakery supply companies in North America and
Europe. The ratings also reflect credit measures following the
transaction that S&P estimates will include adjusted leverage of
more than 5x and a ratio of funds from operations to total debt of
less than 12%.
"We expect CSM Bakery Supplies will maintain adequate liquidity
and improve operating performance and EBITDA margins over the next
year as profitability improves from cost saving and pricing
actions," said Standard & Poor's credit analyst Rick Joy.
MINT LEASING: Delays Form 10-Q for First Quarter
------------------------------------------------
The Mint Leasing, Inc., has experienced delays in completing its
financial statements for the quarter ended March 31, 2013, as its
auditor has not had sufficient time to review the financial
statements for the quarter ended March 31, 2013. As a result, the
Company is delayed in filing its Quarterly Report on Form 10-Q for
the quarter ended March 31, 2013.
About Mint Leasing
Houston, Texas-based The Mint Leasing, Inc., is in the business of
leasing automobiles and fleet vehicles throughout the United
States.
In its report on the consolidated financial statements for the
year ended Dec. 31, 2012, M&K CPAS, PLLC, in Houston, Texas,
expressed substantial doubt about Mint Leasing's ability to
continue as a going concern. The independent auditors noted that
Mint Leasing has a significant amount of debt due within the next
12 months, and may not be successful in obtaining renewals or
renegotiating its loans.
The Company reported a net loss of $238,969 on $10.0 million of
revenues in 2012, compared with a net loss of $1.6 million on
$10.8 million of revenues in 2011.
MONARCH COMMUNITY: Had $328,000 Net Loss in First Quarter
---------------------------------------------------------
Monarch Community Bancorp, Inc., filed with the U.S. Securities
and Exchange Commission its quarterly report on Form 10-Q
disclosing a net loss of $328,000 on $1.95 million of total
interest income for the three months ended March 31, 2013, as
compared with a net loss of $401,000 on $2.30 million of total
interest income for the same period during the prior year.
The Company's balance sheet at March 31, 2013, showed $196.66
million in total assets, $186.62 million in total liabilities and
$10.04 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/DR01Kd
About Monarch Community
Coldwater, Michigan-based Monarch Community Bancorp, Inc. (OTC QB:
MCBF) is the parent company of Monarch Community Bank. The Bank
operates five full service retail offices in Branch, Calhoun and
Hillsdale counties and eight loan production offices in Kalamazoo,
Calhoun, Berrien, Ingham, Lenawee, Kent, Livingston and Jackson
counties and one in Steuben county, Indiana.
Plante & Moran, PLLC, in Grand Rapids, Michigan, expressed
substantial doubt about Monarch Community's ability to continue as
a going concern, noting that the Corporation has suffered
recurring losses from operations and as of Dec. 31, 2012, did not
meet the minimum capital requirements as established by its
regulators.
The Company reported a net loss of $353,000 on net interest income
of $6.5 million in 2012, compared with a net loss of $353,000 on
net interest income of $6.8 million in 2011.
MTS LAND: Martori & Company Approved as Real Estate Appraiser
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona authorized
MTS Land LLC and MTS Golf LLC to employ Martori & Company LLC as
real estate appraiser and valuation expert.
Martori will, among other things:
i) provide the R-43 zoning valuation and updated SUP valuation
of the property; and
ii) if necessary, provide testimony regarding the appraisal
reports in conjunction with the cases.
Prepetition, Martori was engaged to provide an appraisal report of
the Debtors' property.
The Debtors have agreed to pay Martori $5,000 for the appraisal
report containing the R-43 zoning valuation and $8,000 for an
updated SUP valuation. If both appraisal reports are requested
the total compensation for the appraisal reports will be $13,000.
In the event that depositions, court testimony, and related
preparation are required with respect to the appraisal reports,
Martori requests compensation at the billing rate of $350 per
hour.
To the best of the Debtors' knowledge, Martori is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About MTS Land
MTS Land, LLC, and MTS Golf, LLC, own and operate the now dormant
Mountain Shadows Golf Club. They filed separate Chapter 11
petitions (Bankr. D. Ariz. Case Nos. 12-16257 and 12-16257) in
Phoenix on July 19, 2012. Mountain Shadows Golf Club --
http://www.mountainshadowsgolfclub.com/-- is an 18 hole, par 56
course located at Paradise Valley. Nestled in the foothills of
Camelback Mountain, the 3,081-yard Executive course claims to be
one of the most scenic golf courses in Arizona. MTS Land and MTS
Golf are affiliates of Irvine, Cal.-based Crown Realty &
Development Inc. MTS Land and MTS Golf each estimated assets and
debts of $10 million to $50 million.
Judge Charles G. Case II oversees the Debtors' cases. Lawyers at
Gordon Silver serve as the Debtors' counsel. The petition was
signed by Robert A. Flaxman, administrative agent.
Lender U.S. Bank is represented by Steven D. Jerome, Esq., and
Evans O'Brien, Esq., at Snell & Wilmer L.L.P.
The Plan filed in the Debtors' cases provides that all creditors
with allowed claims will be paid the amount of their allowed
claims in full through the Plan. Holders of equity securities of
Debtors will retain all of their legal interests.
The U.S. Trustee for Region 14 advised the Court that an official
committee of unsecured creditors has not been appointed because an
insufficient number of persons holding unsecured claims against
the Debtors have expressed interest in serving on a committee.
The U.S. Trustee reserves the right to appoint a committee if
interest develop among the creditors.
MURRAY ENERGY: S&P Lowers Issue Rating to 'B-' & Affirms 'B' CCR
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its issue rating to
'B-' from 'B' on St. Clairsville, Ohio-based coal producer Murray
Energy Corp.'s (Murray) second-lien secured notes that are part of
the refinancing due to a downsizing to $350 million from
$400 million. The recovery rating is revised to '5' from '4',
indicating S&P's expectation of modest (10% to 30%) recovery. S&P
also affirmed its 'BB-' issue rating on Murray's first-lien term
loan, which has been upsized to $350 million from $300 million.
The recovery rating is '1', indicating S&P's expectation of a very
high (90% to 100%) recovery in the event of a payment default.
At the same time, S&P affirmed the 'B' corporate credit rating and
the 'B' issue rating on Murray's $688 million in senior secured
notes due 2015. The recovery rating on the notes is '3',
indicating S&P's expectation of a meaningful (50% to 70%)
recovery. The outlook remains stable.
"The company expects to use proceeds from the new first-lien term
loan and second-lien notes to redeem its existing $688 million in
senior secured notes," said Standard & Poor's credit analyst Chiza
Vitta.
Murray will also have an unrated $50 million asset-based revolving
credit facility upsized from $25 million as part of this
transaction. S&P expects to withdraw the issue rating on the
existing senior secured notes when the transaction closes.
The corporate credit rating reflects Murray's combination of a
"vulnerable" business profile with an "aggressive" financial
profile. S&P's view stems from the company's relatively small
size, lack of end market diversity, high customer concentration,
and significant debt levels. However, the company maintains a
favorable cost profile, sells coal under long-term contracts, and
has a customer base consisting of the coal-fired plants that S&P
views as less likely to be retired in the near future.
The stable outlook reflects S&P's view that Murray's contracted
sales and low cost position will support cash flow until currently
weak thermal coal conditions start to improve later this year.
S&P expects credit measures to remain in line with its view of the
company's aggressive financial risk profile, which along with the
vulnerable business risk profile are commensurate with the current
rating. S&P expects 2013 adjusted debt to EBITDA of about 5x and
FFO to debt of about 14.5%.
S&P views Murray as having limited financial cushion under its
aggressive financial risk profile. S&P would consider a downgrade
if credit measures weaken any further, or if it views liquidity to
be "less than adequate". In particular, S&P could lower the
rating if debt to EBITDA does not improve or if free operating
cash flow (cash flow from operations less capital spending) is
negative. This could occur if margins decline, or as a result of
a mine stoppage due to unforeseen reasons.
S&P would consider an upgrade if Murray's credit measures
improved. An upgrade would likely require leverage to fall below
4x and would be most likely to occur if S&P was to see a
concurrent improvement in demand for thermal coal.
NANTAHALA CABINS: Case Summary & 3 Unsecured Creditors
------------------------------------------------------
Debtor: Nantahala Cabins, Inc.
580 Nantahala Cabins Lane
Bryson City, NC 28713
Bankruptcy Case No.: 13-20079
Chapter 11 Petition Date: May 10, 2013
Court: United States Bankruptcy Court
Western District of North Carolina (Bryson City)
Judge: George R. Hodges
Debtor's Counsel: D. Rodney Kight, Jr., Esq.
KIGHT LAW OFFICE PC
56 College Street, Suite 302
Asheville, NC 28801
Tel: (828) 255-9881
Fax: (828) 255-9886
E-mail: info@kightlaw.com
Scheduled Assets: $4,750
Scheduled Liabilities: $1,369,998
A copy of the Company's list of its three largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/ncwb13-20079.pdf
The petition was signed by Jeanette Marceau, vice president.
NAVISTAR INTERNATIONAL: To Present at Wolfe Trahan Conference
-------------------------------------------------------------
Navistar International Corporation said that Jack Allen, executive
vice president and chief operating officer, will discuss business
matters related the Company during the 6th Annual Wolfe Trahan &
Co. Global Transportation Conference in New York on Thursday,
May 23, which is scheduled to start at 1:15 pm Eastern.
Live audio webcasts will be available for the presentation at
http://ir.navistar.com/events.cfm. Investors are advised to log
on to the Web site at least 15 minutes prior to the presentation
to allow sufficient time for downloading any necessary software.
The web cast will be available for replay at the same address
approximately three hours following its conclusion, and will
remain available for a period of 12 months or earlier, if the
information is superseded or replaced by more current information.
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.Navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar incurred a net loss attributable to the Company of $3.01
billion for the year ended Oct. 31, 2012, compared with net income
attributable to the Company of $1.72 billion during the prior
year. The Company's balance sheet at Oct. 31, 2012, showed $9.10
billion in total assets, $12.36 billion in total liabilities and a
$3.26 billion total stockholders' deficit.
* * *
In the Aug. 3, 2012, edition of the TCR, Moody's Investors Service
lowered Navistar International Corporation's Corporate Family
Rating (CFR), Probability of Default Rating (PDR), and senior note
rating to B2 from B1. The downgrade of Navistar's ratings
reflects the significant challenges the company will face during
the next eighteen months in re-establishing the profitability and
competitiveness of its US and Canadian truck operations in light
of the failure to achieve EPA certification of its EGR emissions
technology, the significant reductions in military revenues and
substantially higher engine warranty reserves.
As reported by the TCR on June 13, 2012, Standard & Poor's Ratings
Services lowered its ratings on Navistar International Corp.,
including the corporate credit rating to 'B+', from 'BB-'. "The
downgrade and CreditWatch placement reflect the company's
operational and financial setbacks in recent months," said
Standard & Poor's credit analyst Sol Samson.
As reported by the TCR on Jan. 24, 2013, Fitch Ratings has
affirmed the Issuer Default Ratings (IDR) for Navistar
International Corporation and Navistar Financial Corporation at
'CCC' and removed the Negative Outlook on the ratings. The
removal reflects Fitch's view that immediate concerns about
liquidity have lessened, although liquidity remains an important
rating consideration as NAV implements its selective catalytic
reduction (SCR) engine strategy. Other rating concerns are already
incorporated in the 'CCC' rating.
NATIONAL PROPERTY ANALYSTS: Incurs $2.1-Mil. Net Loss in 1st Qtr.
-----------------------------------------------------------------
National Property Analysts Master Limited Partnership filed its
quarterly report on Form 10-Q, reporting a net loss of
$2.1 million on total income of $3.8 million for the three months
ended March 31, 2013, compared with a net loss of $1.9 million on
$3.6 million of total income for the same period last year.
Results for the first quarter ended March 31, 2012, includes
income from discontinued operations of $310,000 relating to the
operating activity of two properties (Seven Hills, Ohio and
Kalamazoo, Michigan) that were disposed of during 2012. Income
from discontinued operations of $310,000 for the three months
ended March 31, 2012m consists of a gain on disposal of the Seven
Hills property of $356,000 offset by a net loss from operations of
$46,000. There was no discontinued operations activity for the
three months ended March 31, 2013.
The Partnership's balance sheet at March 31, 2013, showed
$59.2 million in total assets, $130.5 million in total
liabilities, and a partners' deficit of $71.3 million.
The Partnership said, "Although NPAMLP expects to collect
approximately $6,922,000 in future minimum rent in 2013 and has
$1,969,000 of unrestricted cash and $1,545,000 available under its
line of credit as of March 31, 2013, to satisfy future short-term
obligations, it does not have the ability to satisfy its
wraparound mortgage obligations, totaling $128,241,000 as of
March 31, 2013, which mature and are due in full on Dec. 31, 2013.
As disclosed in Note 5, NPAMLP has agreed to deliver deeds of
future interest or assignments of future leasehold interest in all
of its property holdings in exchange for the satisfaction of the
wraparound mortgage indebtedness. As a result, these conditions
raise substantial doubt about the NPAMLP's ability to continue as
a going concern."
A copy of the Form 10-Q is available at http://is.gd/OBPGmG
Philadelphia, Pa.-based National Property Analysts Master Limited
Partnership was formed effective January 1, 1990. NPAMLP is owned
99% by the limited partners and 1% collectively by EBL&S, Inc.,
the managing general partner, and Feldman International, Inc.
("FII"), the equity general partner.
The properties included in NPAMLP consist primarily of regional
shopping centers or malls with national retailers as anchor
tenants. The ownership and operations of these properties have
been combined in NPAMLP.
In accordance with the partnership agreement, the partnership is
scheduled to terminate on Dec. 31, 2013, however, the managing
general partner has not formally approved a plan for liquidation
of NPAMLP at this time. As such, NPAMLP will continue to report
its combined condensed financial statements on a going concern
basis until a formal plan of liquidation is approved by the
managing general partner.
NPAMLP's primary anchor tenants are Sun Microsystems (the tenant
at the tenant-in-common property), Sears Holdings Corporation and
its subsidiaries and CVS Corporation.
NCI BUILDING: S&P Raises CCR to 'B+' & Rates $240MM Loan 'BB-'
--------------------------------------------------------------
Standard & Poor's Ratings Services said it raised its corporate
credit rating on Houston-based NCI Building Systems Inc. to 'B+'
from 'B'. The outlook is positive.
At the same time, S&P assigned its 'BB-' issue-level rating (one
notch above the corporate credit rating) to the company's proposed
$240 million bank term loan. The recovery rating is '2', which
indicates S&P's expectation of substantial (70% to 90%) recovery
for lenders in the event of a default.
"The upgrade to 'B+' and the positive outlook reflects our view
that private equity owner Clayton, Dubilier & Rice's (CD&R) action
to convert all of its preferred equity share holdings in NCI to
common equity increases the likelihood that CD&R will begin to
reduce its ownership interest in the company and that leverage is
likely to remain below 4x," said Standard & Poor's credit analyst
Thomas Nadramia.
Also, S&P's rating action and outlook reflects NCI's proposed
amended credit agreement, which will extend the maturity of the
existing $240 million term loan to 2019, increase financial
flexibility via a covenant-lite structure (i.e., no financial
ratio maintenance requirements), and lower overall interest costs.
Finally, it is S&P's view that NCI's credit measures should
continue to improve over the next 12 to 24 months as slowly
recovering nonresidential construction markets increase demand for
steel buildings.
The corporate credit rating also reflects S&P's view of the
company's "weak" business risk profile, and "aggressive" financial
risk profile as S&P's criteria defines these terms.
The positive rating outlook reflects S&P's view that NCI's credit
measures should continue to improve as a result of continued slow
recovery in nonresidential construction markets, increasing the
potential for an upgrade if NCI's operating performance improves
closer to historical averages (specifically EBITDA greater than
$100 million) and if CD&R relinquishes its effective control and
ownership below the 40% level as indicated in S&P's criteria for
companies owned by financial sponsors.
S&P could take a negative rating action if sales and EBITDA were
to deteriorate from current trends due to weaker-than-expected
operating conditions, causing leverage to revert to 5x or higher
with little prospect of near-term recovery. S&P could also lower
the rating if CD&R delays or is unable to reduce its investment in
NCI and instead pursues a financial policy that includes debt-
financed dividends or acquisitions that causes leverage to rise
above 5x.
NCI is one of North America's largest integrated manufacturers and
marketers of engineered building systems, metal components, and
coatings services for the nonresidential construction industry.
NECH LLC: Plan Disclosures Denied, Chapter 11 Case Dismissed
------------------------------------------------------------
Judge Richard M. Nieter of the U.S. Bankruptcy Court for the
Central District of California, Los Angeles Division, denied
approval of the disclosure statement explaining Nech, LLC's plan,
and subsequently dismissed the case for reasons stated on the
record during the May 9, 2013 hearing.
About NECH LLC
Baldwin Park, California-based NECH, LLC, filed its Chapter 11
petition on Aug. 12, 2012, in the U.S. Bankruptcy Court Central
District of California (Los Angeles), with Case No. 12-39607,
under Judge Richard M. Neiter. NECH disclosed $9,836,584 in
assets and $286,628,147 in liabilities. Bank of America, N.A.,
which holds a $283,790,245 claim, is the largest unsecured
creditor.
NEWSTAR FINANCIAL: S&P Assigns 'BB-' ICR & Rates $200MM Loan 'BB-'
------------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned a 'BB-' issuer
credit rating on NewStar Financial Inc. The outlook on the rating
is stable. At the same time, S&P assigned a 'BB-' rating on the
company's $200 million senior secured term loan.
"Our ratings on NewStar reflect the company's concentration in
leveraged loans to middle-market companies, its dependence on
collateralized loan obligation funding, and its highly encumbered
balance sheet and low asset liquidity," said Standard & Poor's
credit analyst Brendan Browne. "Its focus on first-lien senior
debt, its diversification across industries and obligors, and its
improving credit quality are positive rating factors."
NewStar focuses on cash-flow loans to middle-market companies, an
asset class that can be cyclical and sometimes difficult to
finance, in a sometimes highly competitive industry. The credit
quality of these loans can deteriorate quickly in a recession, and
the availability of funding for new loans can ebb. For instance,
in 2008 and 2009, NewStar's credit quality deteriorated, its loan
originations dropped sharply, and its balance sheet shrank. As a
result, it reported a large loss in 2009 and relatively weak
earnings in 2010 and 2011. The competition for leveraged loans
can also be intense, driving down loan yields and weakening
underwriting in the industry. In fact, S&P believes that
increasing competition for leveraged loans over the past year has
limited NewStar's asset growth and could affect its profitability
and credit risk.
The company's secured funding profile leaves it with a reliance on
wholesale funding sources, such as CLOs, and a heavily encumbered
balance sheet. As of March 31, 2012, CLO and other secured
funding lines accounted for nearly all of the company's funding.
The market for new CLOs backed by middle-market loans largely
dried up for most of 2009 and 2010. During that time, NewStar
used the revolving periods of its existing CLOs and even issued
one of the market's few CLOs in early 2010. The CLO market has
reopened--the company issued one in late 2012--and it currently
has sufficient available capacity in its financing facilities to
run its business. S&P expects CLO issuance throughout the
industry to be strong in 2013.
The stable outlook reflects S&P's expectation that the company
will work to increase its leverage to greater than 3.0x in the
next 12-18 months through asset growth but maintain its recent
track record of careful underwriting and declining nonperforming
assets. For instance, S&P expects NewStar to underwrite new
leveraged loans generally with senior debt-to-equity ratios of
less than 3.5x. However, S&P believes stiff competition in the
leveraged loan market may limit its ability to expand.
S&P could lower the rating if the company loosens its credit
standards--perhaps if it begins to underwrite loans with senior
debt-to-EBITDA ratios materially higher than 3.5x--or shows a rise
in nonperforming assets. The rating could also come under
pressure if the company's leverage increases more than S&P
expects--to 3.7x or higher faster than it expects.
S&P could raise the rating if the company diversifies its funding
sources more than it expects and improves its balance sheet
liquidity. For instance, S&P would likely look favorably on a
greater mix of unsecured debt, which could unencumber a larger
portion of the company's assets.
NEXT MART: Case Summary & 4 Unsecured Creditors
-----------------------------------------------
Debtor: Next Mart, Inc.
aka University Food Mart
480 N. Glassell
Orange, CA 92866
Bankruptcy Case No.: 13-14187
Chapter 11 Petition Date: May 12, 2013
Court: United States Bankruptcy Court
Central District of California (Santa Ana)
Debtor's Counsel: Rebekah L. Parker, Esq.
LAW OFFICE OF REBEKAH PARKER
445 S Figueroa St., #2600
Los Angeles, CA 90071
Tel: (213) 687-1145
E-mail: RebekahLenParker@aol.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its four largest unsecured
creditors, filed together with the petition, is available for free
at http://bankrupt.com/misc/cacb13-14187.pdf
The petition was signed by Vahid Tavokoli Farson, authorized
agent.
Affiliate that filed separate Chapter 11 petition:
Petition
Debtor Case No. Date
------ -------- ----
Vahid Tavokoli Farson 12-10002 01/01/01
NII HOLDINGS: S&P Assigns 'B-' Rating to $500MM Sr. Unsec. Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' issue-level
rating and '3' recovery rating to NII Holdings Inc.'s (NII)
proposed $500 million of senior unsecured notes due 2019 to be
issued by wholly owned subsidiary NII International Telecoms
S.C.A. (NII International). The '3' recovery rating indicates
S&P's expectation for meaningful (50% to 70%) recovery in the
event of payment default. At the same time, S&P raised the issue-
level rating on the existing debt at this entity one notch to 'B-'
from 'CCC+' and revised the recovery rating to '3' from '5'.
The higher issue-level rating is based on S&P's expectation that
the company will use the proceeds from the notes to repay in full
bank debt at Mexico and a portion of a bank loan in Brazil, which
are structurally senior to debt at NII International, thereby
improving recovery prospects at this entity.
S&P's 'B-' corporate credit rating and stable outlook on Reston,
Va.-based NII are not affected by the new debt since S&P expects
the transaction to be leverage neutral. Total debt to EBITDA was
about 7.2x as of March 31, 2013, and S&P's rating incorporates the
expectation that leverage will rise to the 10x area in 2013
because of substantially lower EBITDA and higher debt balances,
before improving thereafter. Moreover, S&P expects NII to record
large free operating cash flow deficits over the next few years.
RATINGS LIST
NII Holdings Inc.
Corporate Credit Rating B-/Stable/--
New Rating
NII International Telecoms S.C.A.
$500 Mil. Senior Unsecured Notes Due 2019 3
Upgraded; Recovery Ratings Revised
To From
NII International Telecoms S.C.A.
Senior Unsecured B- CCC+
Recovery Rating 3 5
NORTH COUNTRY: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: North Country Building Center, Inc.
P.O. Box 28
Chewelah, WA 99109
Bankruptcy Case No.: 13-02005
Chapter 11 Petition Date: May 13, 2013
Court: U.S. Bankruptcy Court
Eastern District of Washington (Spokane/Yakima)
Judge: Patricia C. Williams
Debtor's Counsel: Bruce K. Medeiros, Esq.
DAVIDSON BACKMAN MEDEIROS, PLLC
601 West Riverside Avenue, Suite 1550
Spokane, WA 99201
Tel: (509) 624-4600
Fax: (509) 623-1660
E-mail: bmedeiros@dbm-law.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/waeb13-02005.pdf
The petition was signed by Mike D. Steinbach, president.
OLD SECOND: Reports $4.2 Million Net Income in First Quarter
------------------------------------------------------------
Old Second Bancorp, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income available to common shareholders of $4.18 million on
$17.49 million of total interest and dividend income for the three
months ended March 31, 2013, as compared with a net loss available
to common shareholders of $4.19 million on $19.45 million of total
interest and dividend income for the same period during the prior
year.
The Company's balance sheet at March 31, 2013, showed $1.95
billion in total assets, $1.87 billion in total liabilities and
$75.85 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/pU04Z9
About Old Second
Old Second Bancorp, Inc., is a financial services company with its
main headquarters located in Aurora, Illinois. The Company is the
holding company of Old Second National Bank, a national banking
organization headquartered in Aurora, Illinois and provides
commercial and retail banking services, as well as a full
complement of trust and wealth management services. The Company
has offices located in Cook, Kane, Kendall, DeKalb, DuPage,
LaSalle and Will counties in Illinois.
Old Second reported a net loss available to common stockholders of
$5.05 million in 2012, as compared with a net loss available to
common stockholders of $11.22 million in 2011.
ORECK CORP: Oreck Family to Buy Back Vacuum Biz. for $21.9-Mil.
---------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Oreck family, which sold Oreck Corp. in 2003 in a
$272 million transaction, will buy the business back in bankruptcy
for $21.9 million, assuming there are no better offers.
According to the report, the Oreck family has signed a contract to
buy the business under a $21.9 million contract including
$14.5 million cash. The remainder of the price will be paid by
assumption of liabilities, including as much as $3.8 million on
customer warranties, $1.4 million for returns and $1 million in
customers' credit balances.
There will be a hearing May 21 for approval of sale procedures.
If the judge goes along with the schedule, competing bids will be
due June 28, followed by an auction on July 8.
Private-equity investor American Securities Capital Partners LP
bought the business 10 years ago. Tom Oreck had only a nominal
continuing interest, although he served as a company spokesman.
He intends to continue manufacturing in the U.S. Debt of
Nashville-based Oreck includes $4.2 million owing to Wells Fargo
Bank NA on a first-lien revolving credit in the maximum amount of
$20 million. There is a $5.5 million second-lien revolving credit
owing to Broadpoint Products Corp.
About Oreck Corp.
Oreck Corporation and eight affiliates sought Chapter 11
protection (Bankr. M.D. Tenn. Lead Case NO. 13-04006) in
Nashville, Tennessee on May 6, 2013, with plans to sell the
business as a going concern.
Oreck has been in the business of manufacturing, marketing and
selling vacuum cleaners and related products since the late 1960s.
The corporate offices are located in Nashville, and the
manufacturing and call center is located in Cookeville, Tennessee.
Oreck has 70 employees in Nashville, 250 employees at its plant in
Cookeville and 325 employees operating 96 company-owned and
managed retail stores.
Bradley Arant Boult Cummings LLP serves as counsel to the Debtor.
BMC Group Inc. is the claims and notice agent.
PATRIOT COAL: Deregisters 2.2 Million Common Shares
---------------------------------------------------
Patriot Coal Corporation filed with the U.S. Securities and
Exchange Commission a post-effective amendment no.1 to the Form
S-8 registration statement relating to the Registration Statement
on Form S-8 filed with the SEC on Feb. 12, 2009, registering the
offer and sale of 3,000,000 shares of common stock of the Company,
issuable pursuant to the Patriot Coal Corporation 401(k)
Retirement Plan, and an indeterminate amount of interests to be
offered or sold pursuant to that Plan.
The Company filed the amendment to to deregister any and all
unsold securities registered pursuant to, and to terminate the
effectiveness of, the Registration Statement. Effective June 28,
2012, the Company ceased offering the Common Stock pursuant to the
Plan and all shares of the Common Stock then held in the Patriot
Stock Fund of the Plan were sold. Participants can no longer
invest in the Common Stock through the Plan. The Company
deregistered 2,236,405 shares of the Common Stock and associated
Plan interests, all of which remained unissued.
A copy of the Amended Prospectus is available for free at:
http://is.gd/83sxgy
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The U.S. Trustee appointed a seven-member creditors committee.
Kramer Levin Naftalis & Frankel LLP serves as its counsel.
Houlihan Lokey Capital, Inc., serves as its financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as its
information agent.
On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's
bankruptcy case to St. Louis. The order formally sending the
reorganization to Missouri was signed December 19 by the
bankruptcy judge. The New York Judge in a Jan. 23, 2013 order
denied motions to transfer the venue to the U.S. Bankruptcy Court
for the Southern District of West Virginia.
PATRIOT COAL: Judge Approves Bonuses for Hundreds of Workers
------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the Patriot Coal Corp. management bonus program
passed muster in the 25-page opinion handed down May 19 by U.S.
Bankruptcy Judge Kathy A. Surratt-States in St. Louis.
The report relates that the $6.9 million program was opposed by
the mine workers' union, which argued that bonuses were either
inequitable in view of concessions demanded from hourly workers or
were prohibited by Congress. The judge disagreed.
The program, the report discloses, consists of two parts, an
incentive plan for 225 employees and a retention program for 113.
Some managers could participate in both. Patriot's six top
executive are eligible for neither. With regard to the incentive
plan, the decline in coal prices means targets required for
earnings bonuses can't be met by merely showing up for work, the
judge said. She said the program is "incentive in nature and
design" and thus doesn't conflict with the statutory prohibition
against retention bonuses for senior managers.
The judge approved the retention bonuses partly because the
program is less rewarding than the bonuses the company handed out
before bankruptcy. If maximum bonuses are earned, the cost to the
company would be 0.36 percent of annual revenue, according to the
opinion. The judge said it's "highly unlikely" that all the
bonuses will be earned.
A copy of the May 16 Order is available at http://is.gd/9tihsq
from Leagle.com.
About Patriot Coal
St. Louis-based Patriot Coal Corporation (NYSE: PCX) is a producer
and marketer of coal in the eastern United States, with 13 active
mining complexes in Appalachia and the Illinois Basin. The
Company ships to domestic and international electricity
generators, industrial users and metallurgical coal customers, and
controls roughly 1.9 billion tons of proven and probable coal
reserves.
Patriot Coal and nearly 100 affiliates filed voluntary Chapter 11
petitions in U.S. bankruptcy court in Manhattan (Bankr. S.D.N.Y.
Lead Case No. 12-12900) on July 9, 2012. Patriot said it had
$3.57 billion of assets and $3.07 billion of debts, and has
arranged $802 million of financing to continue operations during
the reorganization.
Davis Polk & Wardwell LLP is serving as legal advisor, Blackstone
Advisory Partners LP is serving as financial advisor, and AP
Services, LLC is providing interim management services to Patriot
in connection with the reorganization. Ted Stenger, a Managing
Director at AlixPartners LLP, the parent company of AP Services,
has been named Chief Restructuring Officer of Patriot, reporting
to the Chairman and CEO. GCG, Inc. serves as claims and noticing
agent.
The U.S. Trustee appointed a seven-member creditors committee.
Kramer Levin Naftalis & Frankel LLP serves as its counsel.
Houlihan Lokey Capital, Inc., serves as its financial advisor and
investment banker. Epiq Bankruptcy Solutions, LLC, serves as its
information agent.
On Nov. 27, 2012, the New York bankruptcy judge moved Patriot's
bankruptcy case to St. Louis. The order formally sending the
reorganization to Missouri was signed December 19 by the
bankruptcy judge. The New York Judge in a Jan. 23, 2013 order
denied motions to transfer the venue to the U.S. Bankruptcy Court
for the Southern District of West Virginia.
The union and the company are awaiting the judge's ruling on
whether Patriot can modify union contracts and retiree health
benefits. To finance a lower level of health benefits for retired
miners, Patriot is offering 35 percent of the reorganized
company's equity plus royalties on every ton of coal mined.
PITTSBURGH CORNING: Gets Conditional Approval of Chapter 11 Plan
----------------------------------------------------------------
PPG Industries on May 17 disclosed that the United States
Bankruptcy Court for the Western District of Pennsylvania issued
an opinion and interim order confirming the current Pittsburgh
Corning plan of reorganization. PPG and Corning Incorporated are
each 50 percent shareholders of Pittsburgh Corning, which filed
for Chapter 11 bankruptcy protection in 2000. The court also set
a deadline of May 21, 2013, for submission of motions for
reconsideration, which will be heard on May 23, 2013. The court
stated that after hearing such motions, the court will issue a
final confirmation order.
Under the terms of the current plan, which includes the PPG
asbestos settlement arrangement, all current and future personal
injury claims against PPG relating to exposure to asbestos-
containing products manufactured, distributed or sold by
Pittsburgh Corning will be channeled to a trust for resolution.
The final confirmation order will be subject to a customary
appeals process and, if the confirmation order is upheld and all
conditions are met, the plan of reorganization would become
effective. Under the plan of reorganization, PPG and its
participating insurers are to make their initial payments to the
trust 30 business days after the plan becomes effective and all
conditions to funding have been met.
Under the PPG settlement arrangement, PPG's obligation to the
trust consists of cash payments totaling approximately $825
million to be made according to a fixed payment schedule over a
period ending in 2023, about 1.4 million shares of PPG stock or
cash equivalent, and surrendering its shares in Pittsburgh Corning
and Pittsburgh Corning Europe. At March 31, 2013, PPG's accrued
liability related to the settlement arrangement, including the
pre-tax present value of the cash payments, totaled approximately
$800 million of which approximately $550 million was the current
portion. In addition to PPG's obligation to the trust, the
company's participating historical insurance carriers are to make
cash payments to the trust of approximately $1.7 billion in a
series of payments ending in 2027.
Conditional Approval
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Pittsburgh Corning Corp., a joint venture between
Corning Inc. and PPG Industries Inc., received conditional
approval from the bankruptcy court of a Chapter 11 plan, bringing
the company nearer the ability to exit bankruptcy court after more
than 13 years in reorganization.
The report relates that U.S. Bankruptcy Judge Judith K. Fitzgerald
wrote a 139-page opinion on May 16 explaining why Pittsburgh
Corning finally produced a plan satisfying the requirements of
Chapter 11 for dealing with asbestos claims. To ensure she
treated all objections properly, Judge Fitzgerald will hold
another hearing on May 23 if any creditor wants her to reconsider
the ruling. Assuming there are no motions for reconsideration or
she overrules objections, Judge Fitzgerald said, she would sign a
final confirmation order approving the plan.
Mr. Rochelle notes that to show how slowly reorganizations
progress in complex asbestos cases, the plan Judge Fitzgerald
tentatively approved was filed in April 2012 and came on for a
first confirmation hearing in October. There were several
hearings and modifications since. The newest iteration of the
plan resulted from Judge Fitzgerald's ruling in June 2011 when for
a second time she refused to confirm a reorganization plan
designed to shed the company, Corning and PPG of liability for
asbestos claims arising from Pittsburgh Corning's business. She
refused to approve a prior version of the plan in 2006. In 2011,
Judge Fitzgerald turned down the plan because it would have barred
claims that were independent of Pittsburg Corning's business. She
said the plan didn't comply with the so-called insurance
neutrality test because it was ambiguous and might be interpreted
to alter insurance company's rights to resist payment of asbestos
claims. Although rejected by the judge, the prior plan was
accepted by 99 percent of asbestos claimants. When confirmed and
implemented, the plan will allow both Corning and PPG to shed
liabilities by channeling asbestos claims into a trust to be
funded with insurance proceeds.
The newest plan, like its predecessors, is supported by the
asbestos claimants' committee and the representative of future
claimants. It deals with 140,000 claims arising from an asbestos
pipe insulation not manufactured after 1972.
About Pittsburgh Corning
Pittsburgh Corning Corporation filed for Chapter 11 bankruptcy
protection (Bankr. W.D. Pa. Case No. 00-22876) on April 16, 2000,
to address numerous claims alleging personal injury from exposure
to asbestos. At the time of the bankruptcy filing, there were
about 11,800 claims pending against the Company in state court
lawsuits alleging various theories of liability based on exposure
to Pittsburgh Corning's asbestos products and typically requesting
monetary damages in excess of $1 million per claim.
The Hon. Judith K. Fitzgerald presides over the case. Reed Smith
LLP serves as counsel and Deloitte & Touche LLP as accountants to
the Debtor.
The United States Trustee appointed a Committee of Unsecured Trade
Creditors on April 28, 2000. The Bankruptcy Court authorized the
retention of Leech, Tishman, Fuscaldo & Lampl, LLC, as counsel to
the Committee of Unsecured Trade Creditors, and Pascarella &
Wiker, LLP, as financial advisor.
The U.S. Trustee also appointed a Committee of Asbestos Creditors
on April 28, 2000. The Bankruptcy Court authorized the retention
of these professionals by the Committee of Asbestos Creditors: (i)
Caplin & Drysdale, Chartered as Committee Counsel; (ii) Campbell &
Levine as local counsel; (iii) Anderson Kill & Olick, P.C. as
special insurance counsel; (iv) Legal Analysis Systems, Inc., as
Asbestos-Related Bodily Injury Consultant; (v) defunct firm,
L. Tersigni Consulting, P.C. as financial advisor, and (vi)
Professor Elizabeth Warren, as a consultant to Caplin & Drysdale,
Chartered.
On Feb. 16, 2001, the Court approved the appointment of Lawrence
Fitzpatrick as the Future Claimants' Representative. The
Bankruptcy Court authorized the retention of Meyer, Unkovic &
Scott LLP as his counsel, Young Conaway Stargatt & Taylor, LLP, as
his special counsel, and Analysis, Research and Planning
Corporation as his claims consultant.
In 2003, a plan of reorganization was agreed to by various
parties-in-interest, but, on Dec. 21, 2006, the Bankruptcy Court
issued an order denying the confirmation of that plan, citing that
the plan was too broad in addressing independent asbestos claims
that were not associated with Pittsburgh Corning.
On Jan. 29, 2009, an amended plan of reorganization (the Amended
PCC Plan) -- which addressed the issues raised by the Court when
it denied confirmation of the 2003 Plan -- was filed with the
Bankruptcy Court.
As reported by the TCR on April 25, 2012, Pittsburgh Corning
Corp., a joint venture between Corning Inc. and PPG Industries
Inc., filed another amendment to its reorganization plan designed
to wrap up a Chapter 11 begun 12 years ago.
The Company's balance sheet at Sept. 30, 2012, showed
$29.41 billion in total assets, $7.52 billion in total liabilities
and $21.88 billion in total equity.
PORTER BANCORP: Files Form 10-Q, Had $524,000 Net Loss in Q1
------------------------------------------------------------
Porter Bancorp, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
attributable to common shareholders of $524,000 on $11.25 million
of interest income for the three months ended March 31, 2013, as
compared with net income attributable to common shareholders of
$985,000 on $15.75 million of interest income for the same period
during the prior year.
The Company's balance sheet at March 31, 2013, showed $1.13
billion in total assets, $1.08 billion in total liabilities and
$46.73 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/08gyEA
About Porter Bancorp
Porter Bancorp, Inc., is a bank holding company headquartered in
Louisville, Kentucky. Through its wholly-owned subsidiary PBI
Bank, the Company operates 18 full-service banking offices in
12 counties in Kentucky.
Porter Bancorp disclosed a net loss of $32.93 million in 2012, a
net loss of $107.30 million in 2011 and a net loss of $4.38
million in 2010.
Crowe Horwath, LLP, in Louisville, Kentucky, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that the Company has incurred substantial losses in 2012, 2011 and
2010, largely as a result of asset impairments. In addition, the
Company's bank subsidiary is not in compliance with a regulatory
enforcement order issued by its primary federal regulator
requiring, among other things, increased minimum regulatory
capital ratios. Additional significant asset impairments or
continued failure to comply with the regulatory enforcement order
may result in additional adverse regulatory action. These events
raise substantial doubt about the Company's ability
to continue as a going concern.
PRE-PAID LEGAL: S&P Rates Proposed $405MM Secured Refinancing 'B'
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B'
senior secured debt rating to Ada, Okla.-based Pre-Paid Legal
Services Inc.'s proposed $405 million senior secured first-lien
credit facility (composed of a $30 million revolver and
$375 million first-lien term loan). The recovery rating on the
first-lien debt is '3', indicating S&P's expectation of meaningful
recovery (50%-70%) in a payment default scenario. S&P also
assigned a 'B-' issue-level rating on the company's proposed
$110 million secured second-lien debt. The recovery rating on the
second-lien debt is '5', indicating S&P's expectation of modest
recovery (10%-30%) in a payment default scenario.
"We expect the company to use proceeds from the proposed
transaction to refinance about $395 million of outstanding debt
under its existing senior secured credit facility and about
$79 million of preferred stock. We estimate adjusted leverage
(which included preferred stock treated as debt) was in the low-4x
area for the year ended Dec. 31, 2012, and that pro forma for this
proposed transaction, leverage is essentially unchanged. The
proposed refinancing extends debt maturities and lowers pricing.
We expect steady credit metrics over the next year, including
adjusted leverage near the current low-4x area and a ratio of
funds from operations to total debt of over 12%, which is in line
with the indicative financial ratios for an "aggressive" financial
risk profile. This is supported by our expectation of continued
steady operating performance, including flat sales and EBITDA
margins remaining near current levels based on revenue generated
from recurring members over the next year," S&P said.
The ratings on Pre-Paid reflect S&P's view that the company's
financial risk profile is aggressive, based on the company's
financial policy (highlighted by its ownership by a financial
sponsor, and its willingness to fund dividends with debt), fairly
steady cash flow from operations, and adequate liquidity. The
ratings also reflect the company's "vulnerable" business risk
profile, which is supported by the company's narrow product focus
in the highly competitive and fragmented subscription-based legal
service plans market (which S&P believes could be susceptible to
weak economic conditions and declining membership base) and its
limited geographic diversity.
RATINGS LIST
Corporate credit rating B/Stable/--
New Ratings
Pre-Paid Legal Services Inc.
Senior secured
$30 mil. revolver B
Recovery rating 3
$375 mil. first-lien term loan B
Recovery rating 3
$110 mil. second-lien debt B-
Recovery rating 5
PROGUARD ACQUISITION: Incurs $125K Net Loss in 1st Quarter
----------------------------------------------------------
Proguard Acquisition Corp. filed its quarterly report on Form
10-Q, reporting a net loss of $124,659 on net sales of
$2.92 million for the three months ended March 31, 2013, compared
with a net loss of $110,051 on net sales of $4.02 million for the
same period last year.
The Company's balance sheet at March 31, 2013, showed
$1.21 million in total assets, $1.35 million in total liabilities,
and a stockholders' deficit of $140,223.
According to the regulatory filing, the Company anticipates
further losses in the development of its business raising
substantial doubt about the Company's ability to continue as a
going concern.
A copy of the Form 10-Q is available at http://is.gd/5xhXIV
About Proguard Acquisition
Proguard Acquisition Corp. (OTC BB: PGRD), headquartered in
Lauderdale, Florida, is a Business to Business (B2B) reseller of
all general line office and business products.
* * *
As reported in the TCR on April 11, 2013, Pruzansky, P.A., in Boca
Raton, Florida, expressed substantial doubt about Proguard
Acquisition's ability to continue as a going concern, citing the
Company's net loss and net cash used in operations of $445,016 and
$173,189, respectively, during the year ended Dec. 31, 2012, and
stockholders' deficit and accumulated deficit of $49,314 and
$1.42 million, respectively, at Dec. 31, 2012.
RED OAK: S&P Lowers Rating on $384MM Sr. Secured Bonds to 'B+'
--------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its rating on
Red Oak Power LLC's's $384 million senior secured bonds
($224 million 8.54% bonds due 2019 and $160 million 9.2% bonds due
2029) to 'B+' from 'BB-'. S&P removed the ratings from
CreditWatch, where it placed them with negative implications on
Feb. 4, 2013. The recovery rating is unchanged at '2'. The
outlook is negative. Total debt outstanding as of Dec. 31, 2012
(including the debt service reserve term loan) was
$301.3 million (i.e., about $363 per kilowatt).
S&P estimates the effect on total gross margins will be about
$9.3 million spread over 2012 (Red Oak lost some margin in 2012
due to Hurricane Sandy), 2013, and 2014. However, the biggest
effect will be felt during 2013, when S&P expects a lost margin of
more than $6 million. This estimated erosion is largely the loss
of capacity payment revenues due to a lower unforced capacity rate
(and availability). Red Oak has business-interruption insurance,
which is subject to a 45-day deductible post-incident, and will
likely cover a portion of the lost margin. Of the $9.3 million in
lost margins, the company expects to submit a claim for
$4.6 million, which it hopes to recover in late 2013 and early
2014. In addition, although the project expects to recover the
property-related damage of $3.6 million from insurers, there is a
$500,000 deductible.
Given the reduced payments in 2013, S&P expects that the 2013 DSCR
will be close to 1x, not accounting for any potential business-
interruption insurance recovery. Red Oak has about $18.6 million
in its debt service reserve account, and will likely use about
$3 million of that to fund debt service over the next few months.
In addition, Red Oak will use a subordinated loan from the parent
of $600,000 to fund the debt service reserve term loan payment.
S&P expects an improvement in DSCR to about 1.15x in 2014.
"Our ratings reflect that debt service coverage levels that will
remain low through the bond term. Still, a 20-year power purchase
agreement (PPA) mitigates market exposure through 2022. However,
while providing predictability, contractual terms of the PPA have
the effect of impairing cash flow at high capacity factors because
the plant is heat rate deficient (actual unit heat rates are
higher than guaranteed performance). Without this PPA, the
project would operate under merchant power market conditions and
would likely generate higher debt service coverage under
prevailing commodity conditions, but would experience high
volatility in cash flows that would occasionally result in weak
debt service coverage through the debt's term because of commodity
price fluctuations. Also, despite a merchant tail, we anticipate
that by the time the PPA expires, debt will drop to levels that
will allow the project to manage commodity fluctuations to
maintain ratings," S&P said.
The outlook on Red Oak is negative. The plant returned to service
on April 2, 2013 and S&P do not expect any further operational
difficulties. However, the negative outlook reflects the low
coverage level and the need for the project to draw on the debt
service reserve fund over the next few months. Future operational
difficulties that further stress DSCRs and cause the project to
continue to use the debt service reserve fund could lead to a
downgrade. A ratings upgrade -- not currently contemplated --
could occur if Red Oak's DSCR improves and sustains at about 1.15x
(or a DSCR of about 1.1x after ongoing subordinated market-based
management fee payments).
RENTAL SYSTEMS: Case Summary & 16 Unsecured Creditors
-----------------------------------------------------
Debtor: Rental Systems, L.L.C.
dba Rental Systems Construction
12040 Raymond Court
Huntley, IL 60142
Bankruptcy Case No.: 13-81734
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Northern District of Illinois (Rockford)
Judge: Thomas M. Lynch
Debtor's Counsel: Neal L. Wolf, Esq.
NEAL WOLF & ASSOCIATES, LLC
155 N. Wacker Drive, Suite 1910
Chicago, IL 60606
Tel: (312) 228-4990
Fax: (312) 228-4988
E-mail: nwolf@nealwolflaw.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $10,000,001 to $50,000,000
A copy of the Company's list of its 16 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/ilnb13-81734.pdf
The petition was signed by Raymond E. Plote, manager and as
trustee of the sole member.
RESIDENTIAL CAPITAL: Plan Filing Deadline Extended to June 6
------------------------------------------------------------
Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern
District of New York further extended Residential Capital, LLC,
and its debtor affiliates' exclusive plan filing period until
June 6, 2013, and their exclusive plan solicitation period until
Aug. 5.
Before the Court approved the extension, the Official Committee of
Unsecured Creditors and Wilmington Trust National Association as
indenture trustee, said they generally support further extension
of the Debtors' exclusive periods but pushed for a limited
exclusive period extension of up to 30 days instead of the 64 days
originally sought by the Debtors.
The Committee and the Indenture Trustee believe that terminating
the exclusive periods while the mediation is ongoing is
counterproductive and could imperil the successful resolution of
the Chapter 11 cases.
The ad hoc group of junior secured noteholders and a creditor,
Wendy Alison Nora, on the other hand, oppose further extension of
the Debtors' exclusive periods. The Ad Hoc Group complains that a
delay in the prosecution of the Chapter 11 plan process directly
erodes the likely recoveries for general unsecured creditors and
even thereafter the recoveries of secured and administrative
claimants. The Ad Hoc Group also complains of the Debtors'
"tactical delay" when the Debtors incentivize the parties holding
contingent claims to opt to preserve their litigation claims until
the time as they can maximize both the size of their claims and
their recoveries. Ms. Nora complains that the Debtors are not
engaging in negotiations with the class of contingent, unsecured
claimants who are or were homeowners and who have been injured by
fraudulent foreclosures throughout the nation.
In response to the objections and statements, Debtors maintained
that their exclusive periods should be extended as the request is
supported by both the Creditors' Committee and the Indenture
Trustee, two parties who are major economic stakeholders in their
Chapter 11 cases.
The Debtors pointed out that the only economic stakeholder to
object to the request was the Ad Hoc Group, which they assert has
done so to promote their undersecured position and transform that
position -- through an attempt to gain control of the Chapter 11
cases -- into one that is oversecured and pays them postpetition
interest. The Ad Hoc Group displays remarkable cognitive
dissonance in its objection by raising concerns regarding
administrative insolvency, while at the same time demanding
hundreds of millions of dollars in postpetition interest, the
Debtors asserted.
The Debtors related that, in consultation with the Committee, they
have determined to amend their request for an extension to file a
Chapter 11 plan through and including June 6, 2013, and an
extension of the period during which they have the exclusive right
to solicit acceptances of that plan through and including Aug. 5,
2013.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Seeks to Cap Sr. Exec. Bonuses at $272K
------------------------------------------------------------
Since the inception of the bankruptcy proceeding, Residential
Capital LLC and its affiliates have continued administering the
ResCap Severance Plan and honoring their obligations to their
employees under the plan. Recently, during the April 11, 2013
hearing on the Debtors' Key Employee Motion, the Office of the
U.S. Trustee questioned the severance amounts being paid to
certain of the Debtors' insiders. The Debtors agreed to come back
to Court for severance for these covered employees. In the
interim, the Debtors proposed to the U.S. Trustee that the parties
try to consensually resolve any issues between them and submit a
stipulated order to the Court, but such a course of action was not
acceptable to the U.S. Trustee.
The U.S. Trustee purportedly disagrees with the method by which
the Debtors calculate the statutory cap under Section 503(c)(2) of
the Bankruptcy Code. The Debtors propose to set the mean
severance payment to non-management employees by determining the
mean of the total payments to all eligible employees at the start
of the calendar year. The Debtors assert that this method of
calculation is the most fair and equitable manner of calculating
the statutory cap and will not prejudice their insider employees.
Accordingly, the Debtors request that the Court set the statutory
cap for a severance payment to an insider at $136,042. The
severance payment will each be made to two individuals in the
executive key employee incentive plan.
One of the executives resigned May 3 after being with the company
for three years and the other is a 20-year employee who may leave
by the end of May, Bill Rochelle, the bankruptcy columnist for
Bloomberg News said. Both men had been eligible for bonus
payments approved in April. Under two bonus plans, the company
may pay key workers as much as $7.8 million, with almost half the
money going to eight top executives. Had the men remained, they
would have been "entitled to sums well in excess of the $136,000
cap," the company said in court papers.
A hearing on the Debtors' request has been set for May 23, 2013,
at 10:00 a.m. (ET). Objections are due May 16.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: May 23 Pretrial Conference on RMBS Deal
------------------------------------------------------------
Parties to the proposed $8.7 billion settlement with residential
mortgage-backed securities trusts filed motions to exclude
testimonies from the hearing on the approval of the settlement.
The Debtors seek to exclude the testimony offered by:
-- MBIA Insurance Corporation's C.J. Brown because he lacks
the expert qualifications to criticize the analysis of the
Debtors' potential representation and warranty liabilities
in the MBS industry; and
-- Financial Guaranty Insurance Company's Clifford Rossi
because he is not an expert on board processes, he has no
legal training, and he arrives at his opinion using
unreliable methodology.
The Debtors also ask the Court to strike the objection and exclude
the evidence of the Official Committee of Unsecured Creditors to
the motion for approval of the proposed settlement of RMBS claims
because three of the members of the Committee failed to recuse
themselves from the Committee's deliberations and vote on whether
the Committee should support the settlement. The Debtors argue
that FGIC, MBIA and Wilmington have all evidenced a conflict of
interest regarding the matter that disabled them from being biased
and objective in connection with the Committee's deliberation and
vote on the matter.
The Official Committee of Unsecured Creditors seeks to exclude the
testimony offered by:
-- Talcott J. Franklin of Talcott Franklin P.C. because the
Court has refused to permit the depositions of either the
Debtors' outside counsel or the counsel representing the
two sets of investors, including Talcott Franklin;
-- the Debtors' chief financial officer and board member,
James Whitlinger, who will offer a so-called "rebuttal"
witness because the deadline for designating all fact
witnesses has expired more than four months ago;
-- the Debtors' lead RMBS defense counsel, Jeffrey A. Lipps,
because his opinions do not pass muster under the rules
governing expert testimony; and
-- Timothy Devine, Ally Financial, Inc.'s chief counsel
litigation and sole witness from AFI designated to testify
at trial, as he is the principal architect of the RMBS
settlement and the contemporaneous plan support agreements
that provide AFI with broad estate and third-party releases
in exchange for a capped $750 million contribution to the
estates
FGIC and MBIA support and join in the Committee's motions to
exclude the proposed trial testimony of Messrs. Franklin,
Whitlinger, Lipps, and Devine.
A pretrial conference will be held on May 23, 2013. Oral argument
on any motion in limine, Daubert motion, or motion to preclude
witnesses will be heard at the pretrial conference.
Evidentiary hearing on the Motion will be held from May 28 to 31
and on June 3. The hearing will be limited to 30 hours. The
parties supporting the Motion will be allowed 12 hours, and the
parties opposing the motion will be allowed 18 hours.
Closing arguments will be heard on July 1.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RESIDENTIAL CAPITAL: Sues Junior Noteholders Over Liens
-------------------------------------------------------
Residential Capital, LLC, and its debtor affiliates filed an
adversary proceeding against UMB Bank, N.A., as indenture trustee,
and Wells Fargo Bank, Na., as third priority collateral agent and
collateral control agent, for the 9.625% junior secured guaranteed
notes due 2015, to seek a declaratory judgment with respect to the
JSN's liens and adequate protection.
The Debtors allege that the Ad Hoc Group is advancing a position
ostensibly on behalf of a group of significantly undersecured
Junior Secured Noteholders (the "JSNs") who are aggressively vying
to wrest control of these Chapter 11 Cases through the plan
process. To accomplish this task, the Ad Hoc Group -- in
pleadings filed in court and in correspondence with the Debtors'
advisors -- attempt to manufacture an oversecured position that
allegedly entitles the JSNs to postpetition interest through the
misguided creation of collateral value that is premised upon
factual and legal fallacies, Gary S. Lee, Esq., at Morrison &
Foerster LLP, in New York, tells the Court.
According to Mr. Lee, the JSNs collectively assert secured claims
in the amount of $2.22 billion, including principal and accrued
prepetition interest. The Debtors believe that the value of the
collateral securing the Notes is approximately $1.511 billion.
Mr. Less says the Debtors' valuation is based upon (i) the value
attributed to those assets by their purchasers, Ocwen Loan
Servicing, LLC, Walter Investment Management Corp., and Berkshire
Hathaway Inc.; and (ii) the value ascribed to those assets by the
Debtors and their financial advisors. Thus, he asserts, the JSNs
are not entitled to receive postpetition interest because they are
undersecured, even without giving effect to the pending adversary
proceeding commenced by the Official Committee of Unsecured
Creditors, which could potentially reduce the JSNs' secured claim
by hundreds of millions of dollars.
The Official Committee of Unsecured Creditors, on behalf of the
Debtors, commenced an adversary proceeding against UMB Bank and
Wells Fargo seeking declaratory judgment, avoidance of liens, and
disallowance of claims.
In the Committee complaint, the Committee asks the Court to
declare that certain property of the Debtors is not subject to
liens or security interests asserted by the Collateral Agent for
the benefit of the Indenture Trustee and the Junior Secured
Noteholders and that certain liens or security interests asserted
by the Secured Parties on property of the Debtors are unperfected.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities as of March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
REVSTONE INDUSTRIES: Has Secret Deal to Settle Trustee Motion
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Revstone Industries LLC was facing a request by the
official creditors' committee for appointment of a trustee. The
motion was set for hearings on May 14 and 15.
The creditors' reasons for having a trustee were never revealed
because the papers were filed under seal. The settlement hashed
out last week is also a secret.
In response to Revstone's motion for an expansion of the exclusive
right to propose a Chapter 11 plan, the bankruptcy judge in
Delaware signed an order providing that the committee can file a
plan of its own if Revstone doesn't comply with specified
"milestones." What they are is unknown because the settlement is
under seal.
If there is no violation of the milestones, Revstone's exclusivity
was extended to July 31.
In addition to the committee, a trustee was being sought by the
Pension Benefit Guaranty Corp., General Motors Co. and the U.S.
Labor Department.
It is known that the government sued Revstone Chairman George
Hofmeister in August for causing company pension funds to make
improper loans to support the business.
About Revstone Industries, Greenwood Forgings,
& US Tool & Engineering
Lexington, Kentucky-based Revstone Industries LLC, a maker of
truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon
oversees the case. In its petition, Revstone estimated under
$50 million in assets and debts.
Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del.
Case No. 12-13263) on Dec. 3, 2012.
Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No.
13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No.
13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013.
Judge Shannon also oversees the cases.
A motion for joint administration of the cases has been filed.
Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy
counsel to Greenwood and US Tool. Greenwood estimated $1 million
to $10 million in assets and $10 million to $50 million in debts.
US Tool & Engineering estimated under $1 million in assets and
$1 million to $10 million in debts. The petitions were signed by
George S. Homeister, chairman.
REVSTONE INDUSTRIES: Greenwood May Access Cash Thru May 31
----------------------------------------------------------
A May 28, 2013 hearing at 10 a.m. has been set to consider debtor
Greenwood Forgings LLC's continued use of cash collateral.
On April 8, the U.S. Bankruptcy Court for the District of Delaware
authorized Greenwood Forgings' use of cash collateral. The Court
has already entered five interim agreed orders allowing the Debtor
to use cash collateral.
The Debtor may use the cash collateral of Bridgeport Capital
Funding LLC and Boston Finance Group LLC until May 31 for working
capital purposes to preserve the value of assets.
As reported in the Troubled Company Reporter on April 12, 2013, as
adequate protection, the Debtor proposes to grant Bridgeport
replacement liens in all Collateral, which Replacement Lien will
not extend to causes of action commenced to that may be commenced
pursuant to Chapter 5 of the Bankruptcy Code.
Ad adequate protection, the Debtor proposes to grant BFG
replacement liens in the Debtor's accounts and all proceeds,
subject to the Bridgeport Replacement Lien and other lien
priorities. The BFG Replacement will not extend to any causes of
actions commenced or that may be commenced pursuant to Chapter 5
of the Bankruptcy Code.
Bridgeport has a first priority secured lien on all of the
Debtor's assets. BFG, on the other hand, asserts a first priority
lien on the Debtor's machinery and equipment and proceeds and a
second priority lien on certain of the Debtor's cash collateral.
A copy of the proposed fifth interim cash collateral order is
available at http://bankrupt.com/misc/revstone.doc456.pdf
About Revstone Industries, Greenwood Forgings,
& US Tool & Engineering
Lexington, Kentucky-based Revstone Industries LLC, a maker of
truck parts, filed for Chapter 11 bankruptcy (Bankr. D. Del. Case
No. 12-13262) on Dec. 3, 2012. Judge Brendan Linehan Shannon
oversees the case. In its petition, Revstone estimated under
$50 million in assets and debts.
Affiliate Spara LLC filed its Chapter 11 petition (Bankr. D. Del.
Case No. 12-13263) on Dec. 3, 2012.
Lexington-based Greenwood Forgings, LLC (Bankr. D. Del. Case No.
13-10027) and US Tool & Engineering LLC (Bankr. D. Del. Case No.
13-10028) filed separate Chapter 11 petitions on Jan. 7, 2013.
Judge Shannon also oversees the cases.
A motion for joint administration of the cases has been filed.
Duane David Werb, Esq., at Werb & Sullivan, serves as bankruptcy
counsel to Greenwood and US Tool. Greenwood estimated $1 million
to $10 million in assets and $10 million to $50 million in debts.
US Tool & Engineering estimated under $1 million in assets and
$1 million to $10 million in debts. The petitions were signed by
George S. Homeister, chairman.
REYNOLDS OIL: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Reynolds Oil Company, Inc.
P.O. Box Drawer 1879
Lewisburg, WV 24901
Bankruptcy Case No.: 13-50093
Chapter 11 Petition Date: May 13, 2013
Court: U.S. Bankruptcy Court
Southern District of West Virginia (Beckley)
Judge: Ronald G. Pearson
Debtor's Counsel: George L. Lemon, Esq.
122 1/2 North Court Street
P.O. Box 1250
Lewisburg, WV 24901
Tel: (304) 645-3773
E-mail: georgelemon@frontier.com
Scheduled Assets: $1,254,150
Scheduled Liabilities: $4,974,103
The Company did not file a list of creditors together with its
petition.
The petition was signed by Thomas P. Reynolds, president.
RG STEEL: Settles Environmental Claims for $20 Million
------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that RG Steel LLC settled a pair of federal environmental
claims by giving the government approved unsecured claims for
about $20 million.
According to the report, the U.S. Environmental Protection Agency
was seeking civil penalties against RG in connection with plants
in Ohio and West Virginia. At a hearing on July 30, the
settlements will come to bankruptcy court in Delaware for
approval.
The EPA will have a pre-bankruptcy unsecured claim for
$15.75 million against RG Steel Wheeling LLC and a $4.13 million
claim against RG Steel Warren LLC. The settlements don't affect
other claims the EPA can assert.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owned Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture
LLC, sought bankruptcy protection (Bankr. D. Del. Lead Case No.
12-11661) on May 31, 2012. Bankruptcy was precipitated by
liquidity shortfall and a dispute with Mountain State Carbon, LLC,
and a Severstal affiliate, that restricted the shipment of coke
used in the steel production process.
The Debtors estimated assets and debts in excess of $1 billion.
As of the bankruptcy filing, the Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial
advisor and The Seaport Group serves as lead investment banker.
Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman
Carson Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's financial advisor.
The Debtor has sold off the principal plants. The sale of
the Wheeling Corrugating division to Nucor Corp. brought in
$7 million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
RICEBRAN TECHNOLOGIES: Incurs $6.3-Mil. Net Loss in 1st Quarter
---------------------------------------------------------------
RiceBran Technologies filed its quarterly report on Form 10-Q,
reporting a net loss of $6.3 million on $8.7 million of revenues
for the three months ended March 31, 2013, compared with a net
loss of $9.4 million on $9.7 million of revenues in the same
period last year.
The Company's balance sheet at March 31, 2013, showed
$48.1 million in total assets, $40.3 million in total liabilities,
$8.8 million in temporary equity, and an equity deficit
attributable to RiceBran Technologies shareholders of
$1.0 million.
As reported in the TCR on April 15, 2013, BDO USA, LLP, in
Phoenix, Arizona, expressed substantial doubt about RiceBran
Technologies' ability to continue as a going concern. The
independent auditors noted that the Company has suffered recurring
losses from operations resulting in an accumulated deficit of
$204.4 million at Dec. 31, 2012. "Although the Company emerged
from bankruptcy in November 2010, there continues to be
substantial doubt about its ability to continue as a going
concern."
The Company has an accumulated deficit of $210.3 million as of
March 31, 2013.
A copy of the Form 10-Q is available at http://is.gd/Kmr17q
Scottsdale, Ariz.-based RiceBran Technologies, a California
corporation, is a human food ingredient and animal nutrition
company focused on the procurement, bio-refining and marketing of
numerous products derived from rice bran.
RIVIERA HOLDINGS: Incurs $7.5 Million Net Loss in First Quarter
---------------------------------------------------------------
Riviera Holdings Corporation filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $7.54 million on $14.88 million of net revenues for
the three months ended March 31, 2013, as compared with a net loss
of $4.02 million on $20.86 million of net revenues for the three
months ended March 31, 2012.
The Company's balance sheet at March 31, 2013, showed $218.99
million in total assets, $114.25 million in total liabilities and
$104.74 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/Y4vpnE
About Riviera Holdings
Riviera Holdings Corporation, through its wholly owned subsidiary,
Riviera Operating Corporation, owns and operates the Riviera Hotel
& Casino located in Las Vegas, Nevada, which consists of a hotel
comprised of five towers with 2,075 guest rooms, including 177
suites, and which has traditional Las Vegas-style gaming,
entertainment and other amenities.
In addition, Riviera Holdings, through its wholly-owned
subsidiary, Riviera Black Hawk, Inc., owns and operates the
Riviera Black Hawk Casino, a casino in Black Hawk, Colorado and
has various non-gaming amenities, including parking, buffet-styled
restaurant, delicatessen, a casino bar and a ballroom.
Riviera Holdings together with the two affiliates filed for
Chapter 11 on July 12, 2010 in Las Vegas, Nevada (Bankr. D. Nev.
Case No. 10-22910). Riviera Holdings estimated assets and debts
of $100 million to $500 million in its petition. Thomas H. Fell,
Esq., at Gordon Silver, represents the Debtors in the Chapter 11
cases. XRoads Solutions Group, LLC, is the financial and
restructuring advisor. Garden City Group Inc. is the claims and
notice agent.
Riviera Holdings' Second Amended Joint Plan of Reorganization was
confirmed on Nov. 17, 2010. Under the Plan, nearly $280 million
in debt will be replaced with a $50 million loan. Creditors will
receive new stock relative to what they are owed, and holders of
current stock will receive nothing. A total of $10 million in
working capital will come from the new owners, along with $20
million in loans to cover investments in the Las Vegas hotel.
The Plan of Reorganization became effective on Dec. 1, 2010, but
the Plan of Reorganization cannot be substantially consummated
until various regulatory and third party approvals are obtained.
The Substantial Consummation Date will be the 3rd business day
following the day the last approval is obtained.
Riviera Holdings disclosed a net loss of $29.62 million on $86.27
million of total revenues for the period from Jan. 1, 2012,
through Dec. 31, 2012. The Company incurred a net loss of $14.07
million on $70.38 million of total revenues for the period from
April 1, 2011, through Dec. 31, 2011.
* * *
In the July 9, 2012, edition of the TCR, Moody's Investors Service
downgraded Riviera Holdings Corporation's Corporate Family and
Probability of Default ratings to Caa2 from Caa1. The downgrade
of Riviera's Corporate Family Rating to Caa2 reflects heightened
concern on Moody's part regarding Rivera's ability to achieve
profitability over the next few years given that Riviera Las
Vegas, the company's only asset, generates negative EBITDA.
As reported by the TCR on July 5, 2011, Standard & Poor's Ratings
Services assigned its 'CCC+' corporate credit rating to Riviera
Holdings Corp.
"The 'CCC+' corporate credit rating reflects the company's high
debt leverage and vulnerable business position. Riviera operates
two properties (located in Blackhawk, Colo. and Las Vegas, Nev.)
with second-tier market positions in the highly competitive
markets," said Standard & Poor's credit analyst Michael Halchak.
"The rating also factors in the company's excess cash, which we
believe would support the company in the event of a moderate
decline in operating performance."
ROCKWELL MEDICAL: Plans Public Offering of Common Stock
-------------------------------------------------------
Rockwell Medical, Inc., intends to offer shares of its common
stock in an underwritten public offering. Rockwell also expects
to grant the underwriters a 30-day option to purchase up to an
additional 15 percent of the shares of common stock offered in the
public offering to cover over-allotments, if any.
Chardan Capital Markets, LLC, is acting as the sole book-running
manager for the offering.
The offering is subject to market conditions, and there can be no
assurance as to whether or when the offering may be completed, or
as to the actual size or terms of the offering.
Rockwell intends to offer and sell these securities pursuant to
its existing shelf registration statement (File No. 333-181003)
previously filed with, and declared effective by, the Securities
and Exchange Commission. A preliminary prospectus supplement
describing the terms of the offering will be filed with the
Securities and Exchange Commission. Copies of the preliminary
prospectus supplement and accompanying prospectus relating to the
offering may be obtained, when available, by contacting Chardan
Capital Markets LLC, Attention: Scott Blakeman, Director of
Operations, 17 State Street, Suite 1600, New York, NY 10004, or by
calling (646) 465-9025. An electronic copy of the preliminary
prospectus supplement and accompanying prospectus relating to the
offering will be available on the Web site of the Securities and
Exchange Commission at www.sec.gov.
About Rockwell
Rockwell Medical, Inc. (Nasdaq: RMTI), headquartered in Wixom,
Michigan, is a fully-integrated biopharmaceutical company
targeting end-stage renal disease ("ESRD") and chronic kidney
disease ("CKD") with innovative products and services for the
treatment of iron deficiency, secondary hyperparathyroidism and
hemodialysis (also referred to as "HD" or "dialysis").
Rockwell's lead investigational drug is in late stage clinical
development for iron therapy treatment in CKD-HD patients. It is
called Soluble Ferric Pyrophosphate ("SFP"). SFP delivers iron to
the bone marrow in a non-invasive, physiologic manner to
hemodialysis patients via dialysate during their regular dialysis
treatment.
In its report on the consolidated financial statements for the
year ended Dec. 31, 2012, Plante & Moran, PLLC, in Clinton
Township, Michigan, expressed substantial doubt about Rockwell
Medical's ability to continue as a going concern, citing the
Company's recurring losses from operations, negative working
capital, and insufficient liquidity.
The Company reported a net loss of $54.0 million on $49.8 million
of sales in 2012, compared with a net loss of $21.4 million on
$49.0 million of sales in 2011. The Company's balance sheet at
Dec. 31, 2012, showed $17.0 million in total assets, $27.0 million
in total current liabilities, and a stockholders' deficit of $10.0
million.
ROTECH HEALTHCARE: Copy of Credit Agreement with Silverpoint
------------------------------------------------------------
Rotech Healthcare Inc. has amended its current report with the
Securities and Exchange Commission to revise the exhibit index and
attach an amended Exhibit to reflect the revised confidential
treatment request. No other changes have been made to the
Original Report.
On Dec. 21, 2012, the Company entered into a new term loan credit
agreement with Silver Point Finance, LLC, as administrative agent
thereunder and SPCP Group, LLC (an affiliate of Silver Point
Finance, LLC), as initial lender thereunder relating to a term
loan credit facility in an aggregate principal amount of $25
million. Pursuant to the Credit Agreement, the Company borrowed
$23.5 million of the Facility on Dec. 21, 2012. The remaining
$1.5 million portion of the Facility that is not borrowed at such
time may be borrowed on or before Jan. 1, 2014, so long as certain
limited conditions as set forth in the Credit Agreement are
satisfied.
The Facility replaces and repays commitments and loans under the
Company's Credit Agreement, dated as of March 17, 2011, and,
assuming the Company will borrow $1.5 million under the Delayed
Draw Facility, increases available liquidity in the Company by
approximately $15 million. In addition to repaying amounts
outstanding under the 2011 Credit Agreement and fees and expenses
associated with the Facility, the proceeds of the Facility should
provide the Company with additional flexibility to address
anticipated competitive changes and opportunities in the industry
and working capital needs supporting the Company's business plans.
The loans under the Facility will mature on April 30, 2015. The
Credit Agreement does not require any amortization payments in
respect of the loans and the entire principal amount is due at
maturity. All borrowings under the Facility participate in a
first priority security interest in substantially all of the
Company's and the subsidiary guarantor's assets with the Company's
$230 million in aggregate principal amount of 10.75% senior
secured notes due Oct. 15, 2015.
A copy of the Credit Agreement is available for free at:
http://is.gd/U2iq28
About Rotech Healthcare
Based in Orlando, Florida, Rotech Healthcare Inc. (NASDAQ: ROHI)
-- http://www.rotech.com/-- provides home medical equipment and
related products and services in the United States, with a
comprehensive offering of respiratory therapy and durable home
medical equipment and related services. The company provides
equipment and services in 48 states through approximately 500
operating centers located primarily in non-urban markets.
The Company reported a net loss of $14.76 million in 2011, a net
loss of $4.20 million in 2010, and a net loss of $21.08 million
in 2009.
The Company's balance sheet at Sept. 30, 2012, showed
$255.76 million in total assets, $601.98 million in total
liabilities, and a $346.22 million total stockholders' deficiency.
On April 8, 2013, Rotech Healthcare and 114 subsidiary companies
filed petitions seeking relief under chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Lead Case No. 13-10741) to implement a pre-
arranged plan negotiated with secured lenders.
Attorneys at Proskauer Rose LLP, and Young, Conaway, Stargatt &
Taylor serve as counsel to the Debtors; Foley & Lardner LLP is the
healthcare regulatory counsel; Akin Gump Strauss Hauer & Feld LLP
is the special healthcare regulatory counsel; Barclays Capital
Inc. is the financial advisor; Alix Partners, LLP is the
restructuring advisor; and Epiq Bankruptcy Solutions LLC is the
claims agent.
Prepetition term loan lender and DIP lender Silver Point Capital
and other consenting noteholders are represented by Wachtell,
Lipton, Rosen & Katz, and Richards Layton & Finger PA.
The U.S. Trustee at the end of April appointed an official
committee of equity holders. Members include Alden Global
Recovery Master Fund LP, Varana Capital Master LP, Wynnefield
Partners Small Cap Value LP I, Bastogne Capital Partners, LP, and
Kenneth S. Grossman P.C. Pension Plan.
A hearing is scheduled for May 16 on approval of disclosure
materials explaining the plan. The plan is supported by holders
of a majority of the first- and second-lien secured notes. The
$290 million in 10.5 percent second-lien notes are to be exchanged
for the new equity. Trade suppliers are to be paid in full, if
they agree to continue providing credit. The existing $23.5
million term loan would be paid in full, and the $230 million in
10.75 percent first-lien notes will be amended.
ROTHSTEIN ROSENFELDT: New Plan May Head Off Replacing Trustee
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the trustee for law firm Rothstein Rosenfeldt Adler
PA and the official creditors' committee came to agreement on a
revised Chapter 11 plan filed this month. The new plan is
designed to defuse a movement by dissident creditors for
conversion of the Chapter 11 case to liquidation in Chapter 7.
The report recounts that last month, the bankruptcy judge in Fort
Lauderdale, Florida, refused to approve disclosure materials
accompanying the liquidating Chapter 11 plan filed by trustee
Herbert Stettin. Instead, the judge scheduled a hearing on May 30
to consider the dissident creditors' request for converting the
case to Chapter 7 liquidation.
According to the report, opposing conversion, the committee came
together with Mr. Stettin on a revised plan they jointly filed
May 8. The bankruptcy judge in turn scheduled a May 29 hearing
for approval of the new disclosure statement accompanying the
revised plan. The judge presumably won't go ahead on May 30 with
the motion for conversion if he decides the disclosure statement
is adequate and creditors can vote on the revised plan.
The revised plan addresses issues some creditors found
unacceptable in the prior iteration. The $72.4 million settlement
payment from TD Bank NA comes in sooner and so-called third party
releases were cut back to enhance the chance of court approval.
The committee now selects the liquidating trustee, and it's
expected that unsecured creditors will be paid in full.
The new plan provides for a first distribution immediately after
the plan becomes effective.
About Rothstein Rosenfeldt
Scott Rothstein, co-founder of law firm Rothstein Rosenfeldt Adler
PA -- http://www.rra-law.com/-- was suspected of running a
$1.2 billion Ponzi scheme. U.S. authorities claimed in a civil
forfeiture lawsuit filed Nov. 9, 2009, that Mr. Rothstein, the
firm's former chief executive officer, sold investments in non-
existent legal settlements. Mr. Rothstein pleaded guilty to five
counts of conspiracy and wire fraud on Jan. 27, 2010.
Creditors of Rothstein Rosenfeldt Adler signed a petition sending
the Florida law firm to bankruptcy (Bankr. S.D. Fla. Case No.
09-34791). The petitioners include Bonnie Barnett, who says she
lost $500,000 in legal settlement investments; Aran Development,
Inc., which said it lost $345,000 in investments; and trade
creditor Universal Legal, identified as a recruitment firm, which
said it is owed $7,800. The creditors alleged being owed money
invested in lawsuit settlements.
Herbert M. Stettin, the state-court appointed receiver for
Rothstein Rosenfeldt, was officially carried over as the
Chapter 11 trustee in the involuntary bankruptcy case.
On June 10, 2010, Mr. Rothstein was sentenced to 50 years in
prison.
The official committee of unsecured creditors appointed in the
case is represented by Michael Goldberg, Esq., at Akerman
Senterfitt.
S & R GRANDVIEW: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: S & R Grandview, LLC
P.O. Box 673
Wrightsville Beach, NC 28480
Bankruptcy Case No.: 13-03098
Chapter 11 Petition Date: May 13, 2013
Court: U.S. Bankruptcy Court
Eastern District of North Carolina (Wilson)
Judge: Randy D. Doub
Debtor's Counsel: Dean R. Davis, Esq.
LAW OFFICE OF DEAN R. DAVIS
1508 Military Cutoff Road, Suite 102
Wilmington, NC 28403
Tel: (910) 256-6558
Fax: (910) 256-6538
E-mail: juliec@amdpllc.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/nceb13-03098.pdf
The petition was signed by Donald J. Rhine, manager.
SCHOOL SPECIALTY: Files Loan Documents to Accompany Plan
--------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that School Specialty Inc. prepared for the May 20
confirmation hearing to approve the reorganization plan by filing
loan documents for the $300 million in financing to kick in on
emergence from Chapter 11.
There will be a $125 million term loan maturing in six years and a
$175 million asset-backed loan maturing in five. Credit Suisse
Group AG is agent for lenders on both.
The bankruptcy judge only gave conditional approval to disclosure
materials last month. At the confirmation hearing, the court must
first conclude that disclosure was adequate.
Assuming the plan is approved, lenders who provided $155 million
in replacement financing will receive $88 million cash and 87.5
percent of the reorganized company's stock, for a predicted full
recovery. Noteholders owed $170.7 million take the other 12.5
percent of the stock. Their recovery is an estimated 6 percent,
according to the disclosure statement. Trade suppliers, with
$35.6 million in claims, are to be paid 20 percent in cash,
although not until almost seven years after confirmation. The
claims in the meantime will accrue interest at 5 percent.
Alternatively, trade suppliers who continue to provide trade
credit will be paid 45 percent in about seven years, with interest
accruing at 10 percent.
About School Specialty
Based in Greenville, Wisconsin, School Specialty is a supplier of
educational products for kindergarten through 12th grade. Revenue
in 2012 was $731.9 million through sales to 70% of the
country's 130,000 schools.
School Specialty and certain of its subsidiaries filed voluntary
petitions for reorganization under Chapter 11 (Bankr. D. Del.
Lead Case No. 13-10125) on Jan. 28, 2013. The petition estimated
assets of $494.5 million and debt of $394.6 million.
The Debtors are represented by lawyers at Paul, Weiss, Rifkind,
Wharton & Garrison LLP and Young, Conaway, Stargatt & Taylor, LLP.
Alvarez & Marsal North America LLC is the restructuring advisor
and Perella Weinberg Partners LP is the investment banker.
Kurtzman Carson Consultants LLC is the claims and notice agent.
The ABL Lenders are represented by lawyers at Goldberg Kohn and
Richards, Layton and Finger, P.A. The Ad Hoc DIP Lenders led by
U.S. Bank are represented by lawyers at Stroock & Stroock & Lavan
LLP, and Duane Morris LLP. The lending consortium consists of
some of the holders of School Specialty Inc.'s 3.75% Convertible
Subordinated Notes Due 2026.
The Official Committee of Unsecured Creditors appointed in the
case is represented by lawyers at Brown Rudnick LLP and Venable
LLP.
Bayside is represented by Pepper Hamilton LLP and Akin Gump
Strauss Hauer & Feld LLP.
School Specialty in April 2013 decided to reorganize rather than
sell. The company filed a so-called dual track plan that called
for selling the business at auction on May 8 or reorganizing while
giving stock to lenders and unsecured creditors. The company
later served a notice that the auction was canceled and the plan
would proceed by swapping debt for stock to be owned by lenders,
noteholders, and unsecured creditors.
SCIENTIFIC GAMES: S&P Assigns 'BB-' Rating to $2.6BB Facility
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on New York-based gaming services provider Scientific Games
Corp. to 'BB-' from 'BB', and removed the rating from CreditWatch,
where it was placed with negative implications on Jan. 31, 2013.
The outlook is negative.
At the same time, S&P assigned Scientific Games' proposed
$2.6 billion senior secured credit facility our preliminary issue-
level rating of 'BB-' (at the same level as the corporate credit
rating) with a preliminary recovery rating of '3', indicating
S&P's expectation for meaningful (50% to 70%) recovery for lenders
in the event of a payment default. The company will use proceeds
from the new senior secured credit facilities to finance
Scientific Games' $1.5 billion acquisition of WMS Industries Inc.,
to refinancing existing debt, and to pay related fees and
expenses.
In addition, S&P lowered its issue-level rating on the company's
existing secured credit facilities to 'BB+' from 'BBB-'. S&P's
recovery rating on these loans remains '1'. S&P also removed
these ratings from CreditWatch negative.
S&P also lowered its issue-level rating on the company's existing
senior subordinated debt to 'B+' from 'BB-'. The rating remains
on CreditWatch with negative implications. Upon closing of the
new secured credit facilities, S&P expects to revise its recovery
rating on the subordinated debt to '6' (0% to 10% recovery
expectation) from '5' (10% to 30% recovery expectation) and lower
its issue-level rating to 'B' from 'B+', in accordance with S&P's
notching criteria. The revised recovery rating would reflect a
greater amount of secured debt outstanding under S&P's simulated
default scenario versus the company's existing debt structure.
This reduces the recovery prospects for the subordinated debt
enough to warrant a downward revision of S&P's recovery rating.
S&P will finalize its issue-level and recovery ratings on the new
$2.6 billion senior secured credit facilities upon completion of
the acquisition, closing and funding of the debt, and S&P's review
of final documentation. At that time, S&P will also withdraw the
ratings on Scientific Games' existing senior secured credit
facility, which the company will repay as part of the transaction.
The downgrade reflects S&P's expectation that following the
acquisition of WMS, Scientific Games' leverage, as S&P measures
it, will remain above 5x through 2015. This is above S&P's
maximum threshold for its previously assigned financial risk score
of "aggressive," and in line with its new assessment of financial
risk of "highly leveraged." The acquisition demonstrates a
financial policy that is more aggressive than what S&P had
previously factored into the rating. The downgrade also reflects
S&P's view that the company faces a high degree of integration
risk with the acquisition of WMS. S&P believes risks exist
particularly in integrating the research & development and
manufacturing functions, and that these functions are important
for the company to maintain its market position in both
businesses. Scientific Games expects to achieve $100 million in
annual cost savings following the acquisition, and anticipates
that integration costs will total $66 million. S&P's expectation
is that the company will be able to achieve about $70 million in
annual cost savings from the acquisition by the end of the second
year.
SCOTTS MIRACLE-GRO: S&P Affirms 'BB+' CCR & Revises Outlook
-----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit rating on Ohio-based Scotts Miracle-Gro Co. and revised the
outlook to negative from stable.
S&P also affirmed its 'BB-' rating on all of the company's senior
unsecured debt. The recovery ratings remain unchanged at '6',
indicating S&P's expectation for negligible (0% to 10%) recovery
for noteholders in the event of a payment default.
"The company's financial risk profile has weakened as a result
continued tepid operating performance," said Standard & Poor's
credit analyst Linda Phelps. "In particular, the company's
operating performance for the recent quarter was hurt by a late
start to the spring lawn and garden season."
Though heavily dependent upon operating performance during
remainder of its peak operating season, Standard & Poor's
estimates Scotts' debt-to-EBITDA leverage could decline back
towards the mid-2x area over the next 12 months, particularly
given the management's renewed focus on profitability and reducing
leverage in line with its unadjusted leverage target of 2.0x to
2.5x.
As such, S&P views the company's financial risk profile as
continuing to be "significant," given the company's moderate
financial policy and S&P's expectations for credit metrics to
improve. The ratings on Scotts also incorporate S&P's assessment
of the company's strong market positions, well-recognized brand
names, and favorable long-term demographic trends in the consumer
lawn and garden care segment.
"We could lower the rating if average leverage remains over 3x,
possibly as a result of continued weak operating performance or
pursuit of a more aggressive financial policy," said Ms. Phelps.
SEAGATE TECHNOLOGY: S&P Rates Sr. Unsecured Notes 'BB+'
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' issue-level
rating to senior unsecured notes with an intermediate maturity
issued by Seagate HDD Cayman, a subsidiary of Seagate Technology
PLC. The company intends to use the proceeds from the proposed
notes for general corporate purposes, including repayment of
existing debt. S&P rates the new notes the same as the corporate
credit rating on the company.
The 'BB+' corporate credit and other ratings and stable outlook on
Seagate Technology reflects its business concentration within the
hard disk drive (HDD) sector, which is cyclical and threatened by
a secular migration to solid state disk drive (SSD) technology,
resulting in S&P's assessment of the company's business risk
profile as "fair". Although Seagate's pro forma leverage will
approximate 1.0x, the company has demonstrated a willingness at
times to repurchase shares in excess of free cash flow and to
pursue material acquisitions, which results in S&P's assessment of
its financial risk profile as "intermediate". Nonetheless, S&P
expects leverage to remain under 3.0x as is appropriate for the
rating.
RATINGS LIST
Seagate Technology PLC
Corporate Credit Rating BB+/Stable/--
New Ratings
Seagate HDD Cayman
Senior Unsecured Notes BB+
Recovery Rating 3
SM ENERGY: S&P Assigns 'BB' Rating to $400MM Sr. Unsecured Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services on May 16, 2013, said it
assigned its 'BB' senior unsecured issue rating to Denver-based
exploration and production (E&P) company SM Energy Co.'s proposed
$400 million senior unsecured notes due 2024. The recovery rating
on the notes is '4', (the same as the corporate credit rating)
indicating S&P's expectation of average (30% to 50%) recovery in
the event of a payment default.
SM Energy's 'BB' corporate credit rating and stable outlook are
unchanged.
"The recovery prospects with respect to the proposed note issuance
will be on the low end of the '4' recovery range, and should debt
levels or capacity increase, could have a negative effect on the
issue and recovery ratings," said Standard & Poor's credit analyst
Susan Ding.
The company intends to use proceeds to repay outstanding
borrowings on its credit facility and for general corporate
purposes.
The ratings on Denver, Colo.-based SM Energy Co. reflect Standard
& Poor's assessment of the company's "weak" business risk as a
midsize player in the volatile and capital-intensive oil and
natural gas E&P industry. The ratings also reflect the company's
"significant" financial risk.
SM Energy's production base -- 690 million cubic feet equivalent
per day in the first quarter 2013 is comparable with other rated
midsize U.S. E&P companies. The company has increased its
production rapidly in recent years. For full-year 2012,
production was about 219 billion cubic feet equivalent, up about
28% from 2011 production. Management expects a further 17% to 22%
increase in production for 2013 compared with 2012. S&P believes
SM Energy is well-positioned in the Eagle Ford (in Texas) and
Bakken (centered on North Dakota) fields, where ongoing drilling
efforts should enable the company to realize its growth goals.
RATING LIST
SM Energy Co.
Corporate credit rating BB/Stable/--
New Rating
$400 million senior unsecured notes due 2024 BB
Recovery rating 4
SM ENERGY: S&P Lowers Sr. Unsecured Notes Rating to 'BB-'
---------------------------------------------------------
Standard & Poor's Ratings Services said on May 16, 2013, it
lowered its issue ratings to 'BB-' from 'BB' on Denver-based
exploration and production (E&P) company SM Energy Co.'s senior
unsecured notes with various maturities. S&P also revised the
recovery rating on the notes to '5' from '4', (one notch lower
than the corporate credit rating), indicating S&P's expectation of
modest (10% to 30%) recovery in the event of a payment default.
SM Energy's 'BB' corporate credit rating and stable outlook are
unchanged.
"We lowered the recovery and issue ratings due to the company's
increased secured revolver debt capacity resulting from its higher
borrowing base, which is senior in ranking to the unsecured notes
in the event of a payment default, and the higher amount of debt
resulting from the recent $500 million note issuance," said
Standard & Poor's credit analyst Susan Ding.
The ratings on Denver, Colo.-based SM Energy Co. reflect Standard
& Poor's assessment of the company's "weak" business risk as a
midsize player in the volatile and capital-intensive oil and
natural gas E&P industry.
The ratings also reflect the company's "significant" financial
risk.
SM Energy's production base -- 690 million cubic feet equivalent
per day in the first quarter 2013 is comparable with other rated
midsize U.S. E&P companies. The company has increased its
production rapidly in recent years. For full-year 2012,
production was about 219 billion cubic feet equivalent, which is
up about 28% from 2011 production. Management expects a further
17% to 22% increase in production for 2013 compared with 2012.
S&P believes SM Energy is well-positioned in the Eagle Ford
(Texas) and Bakken (centered in North Dakota) fields, where
ongoing drilling efforts should enable the company to realize its
growth goals.
RATING LIST
SM Energy Co.
Corporate credit rating BB/Stable
Ratings Lowered; Recovery Rating Revised
SM Energy Co.
To From
Sr unsecd nts BB- BB
Recovery rating 5 4
SPECTRASCIENCE INC: Delays Q1 Form 10-Q, Expects $2.6MM Loss
------------------------------------------------------------
SpectraScience, Inc., said its Form 10-Q for the period ended
March 31, 2013, could not be filed within the prescribed time
period without unreasonable effort or expense due to the delay in
filing the Company's Form 10-K for the period ended Dec. 31, 2012,
and complexity of accounting for certain convertible debentures
issued by the Company.
Based on preliminary results, non-operating expense decreased
approximately $254,000 as a result of non-cash income and expense
related to the Company's convertible debt issuance comprised of
approximate decreases in the fair value of warrant and derivative
liabilities of $653,000 offset by increases in amortization of
derivative and warrant liability discount of approximately
$300,000, increased amortization of debt issuance costs and
original issue discount of approximately $47,000, loss on
extinguishment of debt of $31,000, increased interest expense of
approximately $19,000 and increases in other non-operating expense
of approximately $2,000.
As a result, the approximate net loss decreased by $529,000 for
the three months ended March 31, 2013, compared to March 31, 2012,
from approximately ($3,152,000) to ($2,623,000).
San Diego, Calif.-based SpectraScience, Inc., focuses on
developing its WavSTAT(R) Optical Biopsy System. The WavSTAT
employs a non-significant risk technology that optically
illuminates tissue in real-time to distinguish between normal and
pre-cancerous or cancerous tissue.
McGladrey LLP, in Des Moines, Iowa, expressed substantial doubt
about SpectraScience, Inc.'s ability to continue as a going
concern. The independent auditors noted that the Company has
suffered recurring losses from operations and its ability to
continue as a going concern is dependent on the Company's ability
to attract investors and generate cash through issuance of equity
instruments and convertible debt.
The Company reported a net loss of $9.1 million on $461,296 of
revenue in 2012, compared with a net loss of $4.8 million on
$26,735 of revenue in 2011.
SPOKANE COUNTRY: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Spokane Country Club
2010 West Waikiki Road
Spokane, WA 99218
Bankruptcy Case No.: 13-01959
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Eastern District Of Washington (Spokane/Yakima)
Judge: Patricia C. Williams
Debtor's Counsel: Barry W. Davidson, Esq.
DAVIDSON BACKMAN MEDEIROS, PLLC
601 W. Riverside Avenue, Suite 1550
Spokane, WA 99201
Tel: (509) 624-4600
Fax: (509) 623-1660
E-mail: bdavidson@dbm-law.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 20 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/waeb13-01959.pdf
The petition was signed by Dan R. Loewen, president.
SPRINGS INDUSTRIES: S&P Assigns 'B' CCR; Outlook Stable
-------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' corporate credit
rating to Middleton, Wis.-based Springs Industries Inc. The
outlook is stable.
"At the same time, we assigned a 'B' issue rating to the company's
proposed $470 million eight-year senior secured notes. The
recovery rating for these notes is '4', indicating our expectation
of average (30%-50%) recovery in the event of a payment default.
The company's $75 million asset-backed (ABL) revolving credit
facility due 2018 is not rated. Issue-level ratings are based
upon preliminary documentation and are subject to review upon
final documentation. Also, upon transaction close, we will
withdraw the corporate credit and issue-level ratings on Springs
Window Fashions LLC (the issuer where the existing debt is
currently held)," S&P said.
The ratings on Springs reflect Standard & Poor's assessment that
the company's financial risk profile will continue to be "highly
leveraged" following the proposed transaction. S&P estimates the
company's pro forma adjusted leverage is high and increases to
about 6x after the transaction, from about 5x as of Dec. 31, 2012.
S&P views the company's financial policy as very aggressive,
supported by the proposed debt-heavy structure that does not
require annual amortization. The ratings also reflect S&P's view
of a "vulnerable" business risk profile, based on the company's
narrow business focus in a cyclical industry, customer
concentration, and participation in an intensely competitive
industry.
"We expect credit metrics will modestly improve as the housing
market continues on a gradual path towards recovery," said
Standard & Poor's credit analyst Jacqueline Hui. "We also expect
liquidity to remain adequate."
Standard & Poor's could consider lowering the ratings if EBITDA
weakens from current levels and economic conditions weaken such
that operating performance deteriorates, and leverage is sustained
above 6x. S&P could consider an upgrade if the company
strengthens its business risk profile, possibly by further
diversifying its customer base, product offerings, and/or
geographic reach.
STELZER-JAMES L.P.: Case Summary & 10 Unsecured Creditors
---------------------------------------------------------
Debtor: Stelzer-James L.P.
3895 Stoneridge Lane
Dublin, OH 43017
Bankruptcy Case No.: 13-53768
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Southern District of Ohio (Columbus)
Judge: Charles M. Caldwell
Debtor's Counsel: Richard K. Stovall, Esq.
ALLEN KUEHNLE STOVALL & NEUMAN, LLP
17 South High Street, Suite 1220
Columbus, OH 43215
Tel: (614) 221-8500
Fax: (614) 221-5988
E-mail: stovall@aksnlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its 10 largest unsecured creditors
filed with the petition is available for free at:
http://bankrupt.com/misc/ohsb13-53768.pdf
The petition was signed by P. Ronald Sabatino, president of
Stelzer-James Corporation, general partner.
STONERIVER GROUP: S&P Assigns 'B' CCR & Rates $570MM Facility 'B+'
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Brookfield, Wisc.-based StoneRiver Group L.P.
The outlook is stable.
At the same time, S&P assigned its 'B+' issue-level rating and '2'
recovery rating to the company's proposed $570 million first-lien
senior secured credit facility, consisting of a $50 million
revolving credit facility and $520 million term loan B. The '2'
recovery rating indicates S&P's expectation for substantial (70%
to 90%) recovery in the event of a payment default.
S&P also assigned its 'CCC+' issue-level rating and '6' recovery
rating to the company's proposed $150 million second-lien term
loan. The '6' recovery rating indicates S&P's expectation for
negligible (0% to 10%) recovery in the event of a payment default.
"Our ratings on StoneRiver reflect its "weak" business risk
profile and "highly leveraged" financial risk profile," said
Standard & Poor's credit analyst Alfred Bonfantini. "Our business
risk assessment is based on the company's meaningful contract
concentration, narrow addressable markets, and a fragmented,
highly competitive landscape in its core workers' compensation
pharmacy benefits manager (PBM) sector. The financial risk
assessment incorporates pro forma leverage in the low-6x area and
a history of debt-financed dividends. Partially offsetting these
negative attributes are the company's consistent profitability and
positive free cash operating flow (FOCF) across its four
businesses, and leading positions in the workers' compensation PBM
and national flood business process outsourcer (BPO) industries,
with high contract renewal rates".
"Our near-term ratings assumptions include: low single digit
organic revenue growth, primarily as a result of low- to mid-
single-digit revenue growth in the PBM division from new client
wins and pharmaceutical price increases; 25 to 50 basis point (bp)
increase in EBITDA margin resulting from increasing higher margin
in-network and mail order revenue in the PBM segment; and only
about a 0.25x annual decline in leverage because the company uses
most FOCF after the excess cash flow sweep for acquisitions," S&P
said.
The stable outlook reflects StoneRiver's leading positions in its
niche worker's compensation PBM and national flood insurance
business process outsourcing business segments, consistent profit
margins, and positive FOCF.
S&P's expectation that the company's private equity majority
ownership will preclude sustained deleveraging, coupled with its
current business risk assessment limit a possible upgrade over the
near term.
S&P could lower the rating to 'B-' if the company sustains
leverage at or above 7.5x as a result of additional debt-funded
dividends or acquisitions, or if increased competition leads to
the loss of plan sponsor/payor relationships or a dwindling
pharmacy network that impedes growth and pressures margins.
SUNSTATE EQUIPMENT: S&P Raises Rating on $170MM Sr. Notes to 'BB'
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it raised its secured
debt rating on Sunstate Equipment Co. LLC's $170 million senior
secured notes due 2016 to 'BB' from 'B+'. S&P also revised the
recovery rating on the notes to '1' from '4'. The '1' recovery
rating indicates S&P's expectation for very high (90%-100%)
recovery in the event of a default.
The higher issue rating reflects improved recovery prospects
stemming from the new security ranking of the notes. The notes
are now secured on a first-priority basis. This priority changed
because Sunstate installed a new unsecured revolving credit
facility that replaced and fully repaid the company's first-lien
asset-based loan facilities that were previously senior to the
notes. Now the entire collateral value is fully available to the
noteholders on a first-priority basis.
The ratings on Phoenix, Ariz.-based Sunstate reflect S&P's
assessment of the company's "weak" business risk profile. The
company is a regional operator in the highly fragmented and
competitive construction equipment rental industry. The ratings
also reflect its limited diversity, capital-intensive equipment
purchases, aggressive leverage, and, before Sumitomo's expanded
interest, somewhat limited financial flexibility. S&P considers
the company's management and governance as "satisfactory."
RATINGS LIST
Sunstate Equipment Co. LLC
Corporate credit rating B+/Stable/--
Rating Raised, Recovery Rating Revised
To From
Sunstate Equipment Co. LLC
Sunstate Equipment Co. Inc.
Senior secured BB B+
Recovery rating 1 4
SUPERVALU INC: S&P Rates $400MM Sr. Unsecured Notes 'B-'
--------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' issue-level
rating to SUPERVALU's proposed $400 million senior unsecured notes
due 2021, with a '6' recovery rating. S&P also assigned a 'B+'
issue-level rating to the amended and restated $1.5 billion term
loan ue 2019, with a '3' recovery rating.
According to the company, it will use proceeds from the new notes
to fund the tender offer for up to $300 million of its existing
$1.0 billion senior unsecured notes due 2016. S&P affirmed all
other ratings, including the 'B+' corporate credit rating. The
outlook is stable.
"The ratings on SUPERVALU reflect Standard & Poor's Ratings
Services' assessment that the company's business risk profile will
remain "weak" and its financial risk profile will be "aggressive"
over the next year," said credit analyst Ana Lai. "We believe
SUPERVALU's more-focused operations should help it stabilize sales
and improve margins after the divestiture of its underperforming
retail banners. Pro forma for the asset sale transaction,
SUPERVALU will generate about 47% of its revenue from its
independent business (food wholesale) division, 25% from Save-A-
Lot, and 28% from the five regional food retailing banners: Cub,
Farm Fresh, Shoppers, Shop 'n Save, and Hornbacher's."
The stable outlook reflects S&P's view that a more-focused
SUPERVALU has the potential to stabilize its performance, achieve
modest sales growth, and improve its profitability following the
asset sale of the underperforming food retailing assets. S&P
believes SUPERVALU will maintain debt leverage in the mid-4x area
from slow improvement in sales and modest debt reduction.
S&P could lower the rating if SUPERVALU is unable to stabilize
sales and profitability falls below S&P's expectations due to
competitive pressure or poor execution. An increase in debt
leverage toward the mid-5x area could be driven by a 2% decline in
revenue while gross margin declines 70 bps.
While S&P do not expect to raise the rating in the next year, it
could upgrade the company if its debt leverage declines to below
4x and sustains it at that level. This could occur if sales
growth exceeds 5% and gross margin improves by more than 50 bps.
TENET HEALTHCARE: S&P Rates $1.05BB Senior Secured Notes 'B+'
-------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B+'
rating to Tenet Healthcare Corp.'s proposed $1.05 billion senior
secured notes due 2022, with a '2' recovery rating, indicating
prospects of substantial recovery (70%-90%) of principal in the
event of a default. This financing, which will refinance the
company's senior secured notes due in 2019, is nearly debt
leverage neutral, and will lower interest rates.
S&P's ratings on Dallas-based Tenet Healthcare Corp. reflect its
"weak" business risk profile highlighted by reimbursement risk and
concentration in only three states: Florida, California, and
Texas. In addition, Tenet operates in several large markets that
we believe are competitive.
S&P's expectation of adjusted debt leverage averaging in the high-
4x range is consistent with the company's "aggressive" financial
risk profile. Significant capacity on its revolving credit
facility and lack of covenant pressure support its "adequate"
liquidity.
RATINGS LIST
Tenet Healthcare Corp.
Corporate Credit Rating B/Stable/--
New Rating
Tenet Healthcare Corp.
$1.05 billion senior secured
notes due 2022 B+
Recovery Rating 2
TENNECO INC: Moody's Revises Outlook on 'Ba3' CFR to Positive
-------------------------------------------------------------
Moody's Investors Service raised the rating outlook of Tenneco
Inc. to positive. In a related action, Moody's affirmed Tenneco's
Corporate Family and Probability of Default Ratings at Ba3 and
Ba3-PD, respectively, and affirmed the ratings on the company's
senior secured bank debt at Baa3, and senior unsecured debt at B1.
The Speculative Grade Liquidity Rating also was affirmed at SGL-2.
Ratings affirmed:
Corporate Family rating, at Ba3;
Probability of Default rating, at Ba3-PD;
Speculative Grade Liquidity Rating, at SGL- 2;
Senior secured revolving credit facility due 2017, at Baa3 (LGD2,
12%);
Senior secured term loan A facility due 2017, at Baa3 (LGD2, 12%);
6 7/8% senior unsecured notes due 2020, at B1 (LGD4, 67%);
7.75% senior unsecured notes due 2018, to B1 (LGD4, 67%)
Ratings Rationale:
The change in Tenneco's rating outlook to positive reflects the
company's improved debt service profile resulting from the
combination of debt refinancing completed in 2012 and the ability
to sustain profitability despite growth pressures in the company's
commercial vehicle and European markets. As a result, Moody's
expects the company to sustain EBIT/Interest above 4.0x on an LTM
basis over the intermediate term. For the LTM period ending March
31, 2013, Tenneco's EBIT/Interest coverage (including Moody's
standard adjustments) was 3.9x. Over the intermediate-term
Tenneco's growth prospects in its clean air division along with
gradual profit margin improvements in this segment should support
further debt reduction under the company's revolving credit
facility. Tenneco's ability to demonstrate sustainably lower debt
levels while growing its clean air division, assuming continued
prudence related to shareholder return initiatives, could support
a positive rating action.
Tenneco's Ba3 Corporate Family Rating continues to incorporate the
company's modest leverage and strong competitive position within
the auto parts supplier sector. As of March 31, 2013, Tenneco's
Debt/EBITDA was 3.1x. Tenneco's revenue growth over the
intermediate term is expected to be driven by new business growth
in the company's clean air division (about 67% of 2012 revenues)
as stricter emissions control regulations come into effect. Much
of the clean air division's growth is expected to be driven by the
global commercial vehicle and specialty markets which are expected
to expand, and the company's penetration of new commercial vehicle
customers. However, growth in China is expected to expand at
slower rates than in the past. This growth should also improve
margins. Yet, Tenneco's revenue growth over the near-term will be
pressured by ongoing weakness in the European Automotive market,
and weakness in the North American commercial vehicle market.
These regional issues are also impacting Tenneco's ride
performance business (33% of revenues).
Tenneco's SGL-2 Speculative Grade Liquidity rating reflects a good
liquidity profile that is expected to continue to be supported
over the near-term by the company's cash balances, free cash flow
generation, and revolving credit availability. As of March 31,
2013, the company maintained cash and cash equivalents of $233
million. Tenneco is anticipated to generate positive free cash
flow on an annual basis over the near-term as moderating growth
trends require less cash investment in working capital. The $850
million senior secured revolving credit facility, which matures in
2017, had $280 million of borrowings and $39 million of
outstanding letters of credit, as of March 31, 2013, and supports
operating flexibility. Moody's expects Tenneco's performance over
the next twelve months to provide ample cushion under the
financial covenants of the bank credit facilities, supporting
access to the commitments. Alternative sources of liquidity are
restricted by additional indebtedness baskets under the bank
credit facilities.
Future events that could drive Tenneco's ratings higher include
continued improvement in production levels in the company's
overall global automotive and commercial vehicle markets leading
to continued improvement in profitability and free cash flow
generation. Consideration for a higher rating could arise if these
factors, in Moody's view, lead to EBIT/Interest being sustained at
over 4.4x and Debt/EBITDA at 2.5x.
Future events that could drive Tenneco's outlook or ratings lower
include declines in global OEM production without successful
implementation of offsetting restructuring actions; elevated
working capital levels resulting in negative free cash flow; or
deteriorating liquidity. Consideration for a lower rating could
arise if these factors were to lead to Debt/EBITDA approaching
3.5x or EBIT/Interest coverage approaching 3.0x times.
The principal methodology used in this rating was the Global
Automotive Supplier Industry Methodology published in January
2009. Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
Tenneco, headquartered in Lake Forest, Illinois, is a leading
manufacturer of automotive emissions control (approximately 67% of
sales) and ride control (approximately 33% of sales) products and
systems for both the worldwide original equipment market and
aftermarket. Leading brands include Monroe, Rancho, Clevite, and
Fric Rot ride control products and Walker, Fonos, and Gillet
emission control products. Net sales in 2012 were approximately
$7.4 billion.
TLO LLC: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------
Debtor: TLO, LLC
4530 Conference Way South
Boca Raton, FL 33431
Bankruptcy Case No.: 13-20853
Chapter 11 Petition Date: May 9, 2013
Court: U.S. Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Paul G. Hyman, Jr.
Debtor's Counsel: Robert C. Furr, Esq.
FURR & COHEN
2255 Glades Road, #337W
Boca Raton, FL 33431
Tel: (561) 395-0500
Fax: (561) 338-7532
E-mail: bnasralla@furrcohen.com
- and ?
Alvin S. Goldstein, Esq.
FURR & COHEN
2255 Glades Road, #337W
Boca Raton, FL 33431
Tel: (561) 395-0500
E-mail: mmitchell@furrcohen.com
Scheduled Assets: $46,613,364
Scheduled Liabilities: $109,925,549
The petition was signed by E. Desiree Asher, CEO.
Affiliate that filed separate Chapter 11 petition:
Entity Case No. Petition Date
------ -------- -------------
Greencook Services LLC 13-20846 05/09/13
TLO, LLC's List of Its 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Equifax Credit Mktg. Inv#151490 $11,973,125
Services (LLC/Corp)
P.O. Box 945510
Atlanta, GA 30394
Dell Financial Services Computer Equipment $4,640,939
(Lease Contr)
Payment Processing Center
P.O. Box 6549
Carol Stream, IL 60197-6549
Experian ? 2983 -- $1,258,937
P.O. Box 886133
Los Angeles, CA 90088-6133
Corelogic Information Master License $697,083
Solutions, Inc. Agreement
P.O. Box 847239
Dallas, TX 75284-7239
BRE Boca Corporate Center, LLC Office Lease $505,332
39174 Treasury Center
Chicago, IL 60694-9100
Dun & Bradstreet Inc. -- $498,509
P.O. Box 75434
Chicago, IL 60675-5434
Experian - 7485 (Inc.) Inv#CD13120 $441,667
P.O. Box 886133
Los Angeles, CA 90088-6133
CoreLogic Teletrack, Inc. Master Lease $281,250
P.O. Box 847075
Dallas, TX 75284-7075
Infutor Data Solutions, Inc. Data License $150,000
Agreement
Experian ? 3812 CD13120 $79,340
LSSiData Corp. Inv #L0019814 $77,000
SMA Communications, LLC -- $70,000
DTE Boca Raton, LLC (Corp.) -- $69,205
Sunera LLC ASV S $61,262
TransUnion, LLC Cust IDxxxx900 $52,523
Experian ? 3664 Inv CD#1 $50,833
Factiva Inc. -- $50,000
Tracers Information Data Breach $48,172
Specialists, Inc.
Experian ? 9430 #CD1310014016 $37,500
Accutrend Data Corp. Data License $30,000
Agreement
TOUSA INC: Files Creditors-Backed Liquidating Plan
--------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that following mediation, Tousa Inc. and its official
unsecured creditors' committee have filed a proposed liquidating
Chapter 11 plan.
The parties filed an 86-page plan and 182-page disclosure
statement following a settlement between the Debtor and creditors
and other settlements crafted by mediator Peter L. Borowitz.
The chart describing distributions to the various creditor classes
by itself is 116 pages long. There will be a 56 percent recovery
on a $206 million term loan. In addition, the lenders will
receive a 50 percent recovery on a $16.6 million claim for
interest at the higher default rate. Second-lien term-loan
lenders with $320.4 million in claims are in line for a 4 percent
recovery, according to the distribution chart attached to the
plan. Senior note claimants, with $573.5 million in claims, are
projected for a 58 percent recovery. General unsecured creditors
with $106.7 million in claims should have a 5 percent recovery,
according to the chart. Subordinated noteholders with $532.8
million in claims receive nothing.
Distributions are made possible in part by the $308 million
pool of cash Tousa was holding at the end of March from the sale
of assets and other recoveries.
The report relates that the impetus for settlement was a decision
in May 2012 by the U.S. Court of Appeals in Atlanta finding that
banks received fraudulent transfers exceeding $400 million.
The hearing for approval of disclosure materials is set for
June 20, so Tousa could hold a confirmation hearing in August for
approval of the plan.
About TOUSA Inc.
Headquartered in Hollywood, Florida, TOUSA, Inc. (Pink Sheets:
TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A.
Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P.,
TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder
in the United States, operating in various metropolitan markets in
10 states located in four major geographic regions: Florida, the
Mid-Atlantic, Texas, and the West.
The Debtor and its debtor-affiliates filed for separate
Chapter 11 protection on Jan. 29, 2008 (Bankr. S.D. Fla. Case
No. 08-10928). Richard M. Cieri, Esq., M. Natasha Labovitz,
Esq., and Joshua A. Sussberg, Esq., at Kirkland & Ellis LLP, in
New York, N.Y.; and Paul S. Singerman, Esq., at Berger Singerman,
in Miami, Fla., represent the Debtors in their restructuring
efforts. Lazard Freres & Co. LLC is the Debtors' investment
banker. Ernst & Young LLP is the Debtors' independent auditor and
tax services provider. Kurtzman Carson Consultants LLC acts as
the Debtors' Notice, Claims & Balloting Agent.
TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba
Eagle Homes, filed for Chapter 11 Protection on July 30, 2008
(Bankr. S.D. Fla. Case No. 08-20746). It estimated assets and
debts of $1 million to $10 million in its Chapter 11 petition.
The official committee of unsecured creditors has filed a proposed
chapter 11 liquidating plan for Tousa. However, the committee
said it would no longer pursue approval of its liquidation plan
because of the pending appeal of its fraudulent transfer case in
the U.S. Court of Appeals for the Eleventh Circuit. A district
court in February 2011 held that the bankruptcy judge was wrong in
ruling that lenders who were paid off received fraudulent
transfers when Tousa gave liens on subsidiaries' properties to
bail out and refinance a joint venture. Daniel H. Golden, Esq.,
and Philip C. Dublin, Esq., at Akin Gump Strauss Hauer & Feld LLP,
in New York, N.Y., represent the creditors committee.
The Tousa committee filed a Chapter 11 plan in July 2010 based on
an assumption it would win the appeal.
TRANZYME INC: Incurs $3.4-Mil. Net Loss in 1st Quarter
------------------------------------------------------
Tranzyme, Inc., filed its quarterly report on Form 10-Q, reporting
a net loss of $3.4 million on $599,000 of revenues for the three
months ended March 31, 2013, compared with a net loss of
$8.4 million on $2.6 million of revenues for the same period last
year.
The Company's balance sheet at March 31, 2013, showed
$13.0 million in total assets, $1.8 million in total liabilities,
and stockholders' equity of $11.2 million.
The Company said: "We have incurred significant losses since our
inception. As of March 31, 2013 our accumulated deficit was
approximately $132.9 million. We expect to incur significant
operating losses over the next several years as we continue to
develop our product candidates, pursue other strategic
opportunities and operating as a public company.
A copy of the Form 10-Q is available at http://is.gd/2JkXXB
Durham, N.C.-based Tranzyme, Inc. (NASDAQ: TZYM), is a
biopharmaceutical company focused on discovering, developing and
commercializing novel, mechanism-based therapeutics.
* * *
As reported in the TCR on April 11, 2013, Ernst & Young LLP, in
Raleigh, North Carolina, expressed substantial doubt about
Tranzyme's ability to continue as a going concern, citing the
Company's recurring losses from operations and net capital
deficiency.
UNIVISION COMMUNICATIONS: Fitch Rates Term Loan & Sec. Notes 'B+'
-----------------------------------------------------------------
Fitch Ratings has assigned a 'B+/RR3' rating to Univision
Communications' 10-year senior secured notes offering and its
proposed term loan due 2020. Fitch currently has a 'B' Issuer
Default Rating (IDR) for Univision. The Rating Outlook is Stable.
Fitch expects the proceeds of both issuances will be used to repay
borrowings under the A/R facility ($300 million outstanding),
revolver ($85 million outstanding) and to repay term loans due
2014 ($153 million outstanding) and 2017 ($1.4 billion
outstanding).
As proposed, Fitch views the transactions favorably as it will
extend Univision's near-term maturities, and further reduce its
2017 maturity. It follows a series of similar refinancing
transactions taken over the past two years that have substantially
reduced the company's near-term obligations. Not adjusting for the
proposed transaction, long-dated maturities include:
-- $1.4 billion due in 2017;
-- $1.2 billion in 2019;
-- $4.2 billion in 2020; and
-- $2.7 billion due 2021 and thereafter.
Key Rating Drivers:
The ratings incorporate Fitch's positive view on the U.S. Hispanic
broadcasting industry, given anticipated continued growth in
number and spending power of the Hispanic demographic.
Additionally, Univision benefits from a premier industry position,
with duopoly television and radio stations in most of the top
Hispanic markets, with a national overlay of broadcast and cable
networks. The company's networks garner significant market share
of Hispanic viewers and generate strong and stable ratings. This
large and concentrated audience provides advertisers with an
effective way to reach the growing U.S. Hispanic population.
Ratings concerns center on the highly leveraged capital structure,
limited free cash flow generation relative to total debt, as well
as the company's significant exposure to advertising revenue.
Univision is saddled with significant leverage from the 2007 LBO,
with Fitch estimated total leverage (including the subordinated
convertible preferred debentures due to Televisa) and secured
leverage of 10.8x and 8.8x, respectively, at March 31, 2013. Given
Fitch's free cash flow expectations ($100 to $200 million in
annual FCF), material debt reduction is not expected; rather
deleveraging will come more from EBITDA growth.
Fitch believes that the private equity owners, Televisa, and the
secured lenders remain motivated to facilitate Univision's long-
term viability, as refinancing an improved operating and credit
profile will provide more value than bankruptcy/debt
restructuring.
Fitch expects Hispanic population growth to mitigate the impact of
longer-term secular issues that are challenging the overall media
& entertainment sector, namely, audience fragmentation and its
impact on advertising revenue. While the Hispanic broadcast
television audience is not immune to these pressures, Fitch
expects that its growing total size will offset the impact of any
audience fragmentation and drive ongoing ratings strength at
Univision's television properties. This should result in mid-
single-digit top-line growth at the television segment. Although a
higher royalty payment and investments in its television business
will likely result in moderate margin pressure over the next one
to two years, Fitch believes positive operating leverage from top-
line growth and growth in high-margin retransmission revenue will
result in subsequent margin improvement.
Rating Sensitivities:
Negative ratings actions could occur if operating results and FCF
are materially lower than Fitch's expectations. This would be
contradictory to Fitch's constructive view on the Spanish language
broadcasting industry and Univision's positioning within it, and
could indicate that the company is more susceptible to secular
challenges than previously anticipated.
Positive ratings actions could occur if Univision delevers
significantly from current levels, with indications that the
company is on target to reach 7x-9x and 5x-6x total and secured
leverage targets, respectively, by 2015/2016. Fitch expects
deleveraging could occur largely through EBITDA growth, as well as
modest debt reduction.
At March 31, 2013, Univision had total debt of $10.4 billion,
which consisted primarily of:
-- $4.9 billion senior secured term loan facility, $153 million
of which is due September 2014, $1.4 billion due 2017 and
$3.4 billion due March 2020;
-- $85 million outstanding under the RCF due 2018;
-- $1.2 billion 6.875% senior secured notes due 2019;
-- $750 million 7.875% senior secured notes due 2020;
-- $815 million 8.5% senior unsecured notes due 2021;
-- $1.2 billion 6.75% senior secured notes due 2022;
-- $300 million outstanding under the A/R securitization facility,
due March 2016;
-- $1.125 billion 1.5% subordinated convertible debentures issued
to Televisa, due 2025. This note is a direct obligation of the
parent HoldCo, Broadcasting Media Partners, Inc., but is
serviced by dividends paid by Univision.
Fitch currently rates Univision as follows:
-- IDR 'B';
-- Senior secured 'B+/RR3';
-- Senior unsecured 'CCC/RR6'.
UNIVISION COMMUNICATIONS: S&P Rates New Debt 'B+'; Outlook Stable
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned New York City-based
Spanish-language TV and radio broadcaster Univision Communications
Inc.'s proposed $500 million term loan due 2020 and $700 million
senior secured notes due 2023 an issue-level rating of 'B+' (one
notch above S&P's 'B' corporate credit rating on the company),
with a recovery rating of '2', indicating S&P's expectation for
substantial (70% to 90%) recovery for lenders in the event of a
payment default.
The corporate credit rating on Univision Communications Inc., the
leader in U.S. Hispanic media, reflects the company's steep debt
leverage and weak interest coverage because of its 2007 leveraged
buyout (LBO), advertising pricing that is not commensurate with
its audience share, and weak trends in radio advertising. S&P
regards Univision's financial risk profile as "highly leveraged,"
(based on S&P's criteria), because of the company's extremely high
pro forma debt to EBITDA of 11.5x as of March 31, 2013. The
proposed transaction causes EBITDA coverage of interest to decline
to 1.55x pro forma for the slightly higher debt and interest
expense from 1.6x as of March 31, 2013. Univision's business risk
profile is "satisfactory," supported by its position as the
market-leading U.S.-based Spanish-language TV and radio
broadcaster. S&P expects Univision to maintain "adequate"
liquidity, supplemented by positive discretionary cash flow,
despite leverage remaining very high. As a result of recent
refinancing activity, the company's 2017 maturities have been
reduced to about $736 million, pro forma for the proposed
transaction. Univision's ability to refinance the remainder of
its 2017 maturities will likely rely on its ability to repay debt
and grow EBITDA over the next few years. S&P assess Univision's
management and governance as "fair."
Univision's operations include TV and cable networks and TV
station groups, radio stations, and online content. It is the
largest Spanish-language radio broadcaster in the U.S.
Univision's market-leading position relies on its popular
primetime programming under a favorable low-cost, long-term
contract with Grupo Televisa S.A., and has held its leading
position despite several new competitors. The Univision network
reaches virtually all U.S. Hispanic households, and often
generates audience ratings higher than some of the four major
English-language TV networks. Univision has not narrowed the gap
between Spanish language and English language advertising rates
for several years, but revenue and EBITDA growth have been
sustained by an increase in advertising sales volumes and higher
retransmission fees from multichannel video providers.
UNIVITA HEALTH: S&P Cuts CCR to 'B-' & Alters Outlook to Negative
-----------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Univita Health Inc. to 'B-' from 'B' and revised
the outlook to negative from stable.
S&P also lowered the rating on the company's senior secured term
loan to 'B-' (the same as the corporate credit rating) from 'B'.
Our '3' recovery rating, on the company's senior secured term loan
remains unchanged, and reflects S&P's expectation for meaningful
(50%-70%) recovery in the event of payment default.
"The downgrade reflects weaker than expected EBITDA and covenant
cushions that tightened to 10% in the quarter ended Dec. 31, 2012,
resulting from ongoing expansion and integration challenges in the
integrated health care (IHC) segment," said credit analyst David
Kaplan. "EBITDA has been pressured by system and integration
issues from rapid expansion because of the acquisition of All-Med,
recent contract wins, and entrance into new states, together with
higher than expected All-Med integration costs and utilization
under capitated contracts. Moreover, Univita had an extremely
thin cash balance and free cash outflows in fiscal 2012, requiring
them to borrow under the revolving credit facility. Currently, it
can access the $8 million remaining under the $20 million
revolver, without breaching covenants, but continued negative free
cash outflows could deplete that availability over the next 12
months. We consider Univita's liquidity to be "less than
adequate"."
Recent contract wins and the continued integration of All-Med will
result in higher revenues. However, the negative outlook reflects
S&P's expectation that EBITDA will increase only modestly because
of lower margins and higher operating expenses and that free cash
flow will be minimal, at best, because of ongoing investments to
fund business growth. As a result, S&P believes liquidity will
remain thin over the near term.
S&P could lower the rating if liquidity tightens further and the
company is unable to obtain relief from the lenders. Although the
company can currently access the $8 million available under the
$20 million revolver, Univita will likely run out of revolver
capacity over the next year if the company continues to experience
negative free cash outflows.
S&P could revise the outlook to stable once the company is able to
generate positive free cash flow, sustain it for several quarters,
and use it to build on hand cash or reduce revolver borrowings.
Univita could achieve this if they are able to successfully
resolve current operating issues and onboard recently awarded
contracts. This would occur if Univita generated revenue growth
of at least 26% and generated a minimum EBITDA margin of 17%.
UROLOGIX INC: Incurs $1-Mil. Net Loss in Fiscal 3rd Quarter
-----------------------------------------------------------
Urologix, Inc., filed its quarterly report on Form 10-Q, reporting
a net loss of $1.0 million on $4.1 million of sales for the three
months ended March 31, 2013, compared with a net loss of $968,000
on $4.7 million of sales for the prior fiscal period.
The Company reported a net loss of $3.0 million on $12.4 million
of sales for the nine months ended March 31, 2013, compared with a
net loss of $3.5 million on $12.5 million of sales for the nine
months ended March 31, 2012.
The Company recorded a one-time gain of $321,000 for the three and
nine-month periods ended March 31, 2013, resulting from the
demutualization of the Company's products liability insurance
carrier.
The Company's balance sheet at March 31, 2013, showed
$16.3 million in total assets, $14.7 million in total liabilities,
and stockholders' equity of $1.6 million.
The Company said, "During the first quarter of fiscal 2013, the
Company completed a follow-on offering in which we sold 5,980,000
shares of common stock at a price of $0.75 per share which
contributed approximately $3.8 million of net proceeds after
deducting underwriting discounts and commissions and other
expenses payable by the Company. However, as a result of the
Company's history of operating losses and negative cash flows from
operations, and the licensing fee, royalties and inventory
payments related to the Prostiva acquisition, there is substantial
doubt about our ability to continue as a going concern."
A copy of the Form 10-Q is available at http://is.gd/hE1ilY
About Urologix, Inc.
Minneapolis, Minnesota-based Urologix, Inc., develops,
manufactures, and markets non-surgical, office-based therapies for
the treatment of the symptoms and obstruction resulting from non-
cancerous prostate enlargement also known as benign prostatic
hyperplasia (BPH).
* * *
KPMG LLP, in Minneapolis, Minnesota, expressed substantial doubt
about Urologix, Inc.'s ability to continue as a going concern.
The independent auditors noted that the Company has suffered
recurring losses from operations and negative operating cash flows
and has significant current obligations related to the Sept. 6,
2011 acquisition of the Prostiva(R) Radio Frequency (RF) Therapy
System from Medtronic, Inc.
VERIS GOLD: Incurs $6.5-Mil. Net Loss in First Quarter
------------------------------------------------------
Veris Gold Corp. submitted to the U.S. Securities and Exchange
Commission on May 14, 2013, its consolidated financial statements
for the three months ended March 31, 2013.
The Company reported a net loss of US6.5 million on
US$45.4 million of revenue for the three months ended March 31,
2013, compared with a net loss of US$7.8 million on
US$20.9 million of revenue for the same period last year.
The Company's balance sheet at Dec. 31, 2012, showed
US$341.2 million in total assets, US$249.5 million in total
liabilities, and shareholders' equity of US$91.7 million.
The Company had a loss from operations of US$5.5 million for the
three months ended March 31, 2013 (2012 - loss of US$5.4 million),
and a US$1.0 million inflow of cash from operations for the same
period (2012 - outflow of US$6.5 million). At March 31, 2013, the
Company had a working capital deficiency of US$78.9 million
(Dec. 31, 2012 - US$34.3 million) and an accumulated deficit of
US$385.5 million (Dec. 31, 2012 - US$379.0 million).
A copy of the consolidated financial statements for the three
months ended March 31, 2013, is available at http://is.gd/MQjPlD
About Veris Gold
Veris Gold Corporation, headquartered in Vancouver, Canada, is a
gold metal producer engaged in the mining, exploration and
development of mineral properties located in Canada and the United
States. The Company is incorporated under the laws of the
Province of British Columbia, Canada and its shares are listed on
the Toronto Stock Exchange and the Frankfurt Exchange.
* * *
As reported in the TCR on April 11, 2013, Deloitte LLP, in
Vancouver, Canada, expressed substantial doubt about Veris Gold's
ability to continue as a going concern, citing the Company's net
losses over the past several years, working capital deficit in the
amount of US$34.3 million and accumulated deficit of
US$379.0 million as at Dec. 31, 2012.
WALLDESIGN INC: CRO May Abandon Title to Aircraft
-------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
has approved a stipulation directing Walldesign, Inc.'s chief
restructuring officer to abandon title to collateral via bill of
sale and "professional user entity" authorization.
The stipulation was entered among the Debtor and VFS Financing,
Inc., and the Official Committee of Unsecured Creditors. The
stipulation was signed off by the Court on March 5.
In January 2013, VFS filed a motion seeking an order granting
relief from the automatic stay. The personal property which is
the subject of the Motion is a Hawker Beechcraft, Model No. 900XP,
Serial No. HA0063, U.S. Registration No. N288MB and two Honeywell
model TFE731-50R aircraft engines bearing manufacturer's serial
numbers P122232 and P122233.
VFS also sought orders:
(a) directing the Debtor, via its court-appointed CRO, to
demand turnover of funds, if any held by third parties,
including Delta Private Jets and/or Michael R. Bello, that
constitute cash collateral resulting from the unauthorized
lease of the Aircraft, and to pay such funds, if any,
constituting VFS's cash collateral to VFS;
(b) directing the Debtor, via its court-appointed CRO, to notify
Delta Private Jets that the lease agreement it executed in
connection with the Aircraft was not authorized by the Debtor
or the Bankruptcy Court, and is not an effective agreement;
and
(c) directing the Debtor, via its CRO or other representative of
the Debtor's estate, to execute any documentation necessary to
effectuate transfer of title to the Collateral to VFS or its
designee, including but not limited to a bill of sale, the
appointment of VFS or its designee as a professional user
entity ("PUE") on the International Registry, and any
reasonably necessary antecedent steps necessary to effectuate
such appointment including any reinstatement of the Debtor's
status on the International Registry (the "Title Transfer
Request").
The Committee responded that if VFS enters into an agreement to
sell, lease, or transfer any interest in the Collateral to Michael
R. Bello or any entity controlled by Mr. Bello, the agreement be
subject to the review and approval of the Debtor and the Committee
and, if either objects to the terms of the agreement, to the
approval of the Bankruptcy Court.
Counsel for VFS, the Committee and the Debtor met and conferred
regarding the Title Transfer Request. The parties later reached a
resolution on the matter. The deal requires VFS to give no less
than 10 days' notice to the Committee and the Debtor regarding any
agreement by VFS to sell, lease, or transfer any interest in the
Collateral to Mr. Bello or any entity controlled by Mr. Bello. If
the Committee or the Debtor object to the terms of any agreement,
the parties will attempt to resolve any issues, and if they
cannot, VFS will seek from the Bankruptcy Court approval of the
sale to Mr. Bello or an entity controlled by Mr. Bello.
About Walldesign
Walldesign Inc., incorporated in 1983, has been in the business of
installing drywall, insulation, plaster and providing related
services to single and multi-family construction projects
throughout California, Nevada and Arizona for over 20 years.
Customers include some of the largest homebuilders in the United
States, such as Pulte, DR Horton, K. Hovnanian, Toll Brothers and
KB Homes. In fiscal 2011, Walldesign generated more than $43.5
million in annual revenues.
Walldesign, based in Newport Beach, California, said the global
credit crisis that occurred in the third quarter of 2008 had a
severe negative impact on its business: capital for construction
projects dried up, buyers vacated the market for new homes and
profit margins on new jobs eroded. Although it has significantly
downsized its operations in an effort to remain profitable in the
recessionary conditions, cash flow problems arose during this
process. These problems slowed payments to vendors, precipitating
collection lawsuits forcing it to seek Chapter 11 protection
(Bankr. C.D. Calif. Case No. 12-10105) on Jan. 4, 2012.
Judge Robert N. Kwan presides over the case. Marc J. Winthrop,
Esq., Sean A. O'Keefe, Esq., and Jeannie Kim, Esq., at Winthrop
Couchot, serve as the Debtor's counsel. In its petition, the
Debtor estimated $10 million to $50 million in assets and debts.
The petition was signed by Michael Bello, chief executive officer.
An official committee of unsecured creditors has been appointed in
the case. The Committee tapped Jones Day as its counsel.
WESTWOOD PLAZA: Case Summary & 8 Unsecured Creditors
----------------------------------------------------
Debtor: Westwood Plaza LLC
1705 S. 42nd Street
West Des Moines, IA 50265
Bankruptcy Case No.: 13-01407
Chapter 11 Petition Date: May 13, 2013
Court: U.S. Bankruptcy Court
Southern District of Iowa (Des Moines)
Judge: Lee M. Jackwig
Debtor's Counsel: Jeffrey D. Goetz, Esq.
BRADSHAW, FOWLER, PROCTOR & FAIRGRAVE, P.C.
801 Grand Avenue, Suite 3700
Des Moines, IA 50309-8004
Tel: (515) 246-5817
Fax: (515) 246-5808
E-mail: bankruptcyefile@bradshawlaw.com
- and ?
Chet A. Mellema, Esq.
BRADSHAW, FOWLER, PROCTOR & FAIRGRAVE, P.C.
801 Grand Avenue, Suite 3700
Des Moines, IA 50309-8004
Tel: (515) 246-5822
Fax: (515) 246-5808
E-mail: mellema.chet@bradshawlaw.com
- and ?
Donald F. Neiman, Esq.
BRADSHAW, FOWLER, PROCTOR & FAIRGRAVE, P.C.
801 Grand Avenue, Suite 3700
Des Moines, IA 50309-8004
Tel: (515) 246-5877
Fax: (515) 246-5808
E-mail: neiman.donald@bradshawlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A copy of the Company's list of its eight largest unsecured
creditors filed with the petition is available for free at:
http://bankrupt.com/misc/iasb13-01407.pdf
The petition was signed by Arun Kalra, managing member.
WYNN RESORTS: S&P Retains 'BB+' Corporate Credit Rating
-------------------------------------------------------
Standard & Poor's Ratings Services assigned Las Vegas-based casino
operator Wynn Resorts Ltd.'s proposed $500 million senior notes
due 2023 its 'BBB-' issue-level rating, with a recovery rating of
'2', indicating S&P's expectation for substantial (70% to 90%)
recovery for noteholders in the event of a payment default. The
notes will be secured by a first-priority pledge of Wynn Resorts'
equity interest in Wynn Las Vegas LLC (WLV), which is the same
security for the existing first mortgage notes issues. The notes
will be co-issued by subsidiaries WLV and Wynn Las Vegas Capital
Corp.
The company plans to use proceeds from the notes offering to
purchase its outstanding 7.875% first mortgage notes due 2017
through a tender offering and to use any remaining net proceeds to
redeem 2017 notes not tendered. S&P will withdraw its issue-level
and recovery ratings on the 2017 notes when they are fully
redeemed.
S&P's 'BB+' corporate credit rating on Wynn Resorts represents its
assessment of the company's business risk profile as
"satisfactory" and its financial risk profile as "significant."
"Our assessment of Wynn's business risk profile as satisfactory
reflects its leading presence in two of the largest global gaming
markets, its high-quality assets and well-known brand, and an
experienced management team. These business strengths are
somewhat offset by the gaming industry's vulnerability to economic
cycles given its discretionary nature and the high levels of
competition in the Las Vegas and Macau gaming markets.
Management's relatively aggressive expansion strategy (including
substantial expected debt-financed development spending in Cotai
over the next several years) is also a business risk factor,
although we believe management will employ a measured pace of
development, given Steve Wynn's intimate involvement in the design
of each of Wynn's resorts," S&P said.
"Our assessment of Wynn's financial risk profile as "significant"
reflects its large debt burden and the planned largely debt-
financed expansion in Cotai, which should preclude any meaningful
improvement in leverage from about 4x at March 31, 2013. Our
financial risk profile assessment also reflects Wynn's track
record of returning substantial capital to shareholders. We
expect Wynn's strong liquidity position will help it to pursue and
finance developments in a manner that preserves credit quality in
line with the current rating on Wynn," S&P added.
RATINGS LIST
Wynn Resorts Ltd.
Corporate Credit Rating BB+/Stable/--
New Rating
Wynn Las Vegas LLC
Wynn Las Vegas Capital Corp.
$500M senior notes due 2023 BBB-
Recovery Rating 2
* Bankrupts in Chapter 13 Have Standing to Sue, 4th Cir. Says
-------------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that the U.S. Court of Appeals in Richmond, Virginia,
became the sixth circuit court to rule that individual bankrupts
in Chapter 13 have standing, or the right to bring lawsuits
asserting claims arising before bankruptcy.
According to the report, the Fourth Circuit in Richmond said
standing rules applicable to bankrupts in Chapter 7 don't apply in
Chapter 13 where the individual maintains ownership of estate
property. The appeal involved an employment discrimination suit
commenced by an individual after filing in Chapter 13. The
bankrupt properly listed the lawsuit as an asset.
The district judge denied the employer's motion to dismiss. Like
the circuit court on appeal, the district court concluded that the
bankrupt had standing. Unfortunately for the employee, the
district and circuit courts agreed his claim had no merit.
The case is Wilson v. Dollar General Corp., 12-1573, 4th U.S.
Circuit Court of Appeals (Richmond).
* Challenges Remain in Homeownership & Housing Markets
------------------------------------------------------
The shape of homeownership and housing markets has changed
dramatically over time and will continue to change in the face of
new housing opportunities and challenges. That's according to
panelists at the "Challenges and Opportunities in Housing and
Homeownership" session on May 17 during the Realtors(R) 2013
Midyear Legislative Meetings & Trade Expo here.
During the session academics from DePaul University, George Mason
University, University of North Carolina and the University of
Maryland presented various research and data illustrating the
impact of shifting demographics, new mobility patterns and an
uncertain interest rate environment on future housing prices,
availability and affordability. Funding for some of the research
was provided by the REALTOR(R) University Center for Real Estate
Studies.
"The residential mobility rate in the U.S. has been falling
steadily since the 1990s, when it was approximately 20 percent, to
its current level of 12 percent," said National Association of
Realtors(R) Chief Economist Lawrence Yun. "The decline is
unwelcome news since it may imply a reduction in economic
mobility. Mobility is currently being impacted by the lack of
housing inventory since fewer homes are available. In the future,
proposed regulations requiring larger down payments could also
significantly reduce mobility since fewer homeowners may be able
to afford a home."
Lisa Sturtevant from George Mason University's Center for Regional
Analysis said recent trends in residential mobility are most
likely the result of changes in the age distribution of the
population. She said the two largest segments of the population -
- baby boomers and millennials -- are delaying many major
lifecycle events that have been traditional for their respective
life stages, like marriage, children and retirement. That also
means they are not moving as much as members of previous
generations at the same life stages, which could be dragging down
the overall residential mobility rate.
"Homeownership rates have declined fastest for millennials, most
likely the result of fewer job opportunities and higher student
debt; however, I believe they still want to become owners and will
eventually make their way into the housing market," said
Sturtevant. "When they do enter the market they'll care about
different things than previous generations too; I foresee more
single people buying smaller homes in urban areas."
Yun agreed that the recent housing downturn hasn't changed younger
buyers' attitudes about homeownership, despite many of them
delaying their entrance into the market. "Rather, reduced home
prices and lower interest rates have provided an opportunity for
younger buyers to affordably enter the housing market," he said.
James D. Shilling from DePaul University's Institute for Housing
Studies shared his insights into recent trends in household
mobility and its future impact on the single-family housing
market.
"Higher home prices will unlock a large number of households with
negative or low equity and incentivize them to get off the
sidelines and into the housing market. However, combined with
future increases in interest rates, the net effect is likely an
overall reduction in residential real estate transactions and
household mobility," said Mr. Shilling.
He anticipates the Federal Reserve will keep mortgages rates low
through 2013 and most likely into 2014; consequently the majority
of current homeowners will have mortgages with loans rates near
record lows, and when rates start to rise they will not be
incentivized to give up those low-rate loans to buy a new home
with a higher rate mortgage.
Lucy Gorham from the Center for Community Capital at the
University of North Carolina offered her perspective into housing
policy implications for homeowners, including proposed regulations
requiring higher down payments from home buyers. She said while
restrictive underwriting helps lower loan defaults, it
disenfranchises a higher percentage of creditworthy borrowers; if
20 percent down payments were required, as many as 60 percent of
current buyers could be outside of the qualified mortgage criteria
and potentially face higher interest rates or fees.
"Despite the recent housing crisis, homeownership continues to
help build wealth for lower to middle-income households. A safe
mortgage product with good underwriting helps lower loan defaults;
requiring greater down payments simply closes off access to a
greater percentage of borrowers," said Ms. Gorham.
Imposing higher down payment requirements would negatively affect
low- and moderate-income households and disproportionately impact
minority homebuyers, she said. Ms. Gorham said minority families
tend to have lower wealth and greater need for access to
mainstream sustainable loan products, and that more will need to
be done to meet their credit requirements since minority families
are expected to be the greatest source of future housing demand.
Margaret McFarland, Colvin Institute of Real Estate Development at
the University of Maryland, agreed that excessive risk reductions
requiring higher down payments and credit scores exclude too many
well performing loans from the market.
"Federal Housing Administration loans are an important financing
option for affordable homeownership," she said. "Veterans Affairs
home loans also perform very well in relation to other mortgage
products, even with a zero down payment."
The National Association of Realtors(R), "The Voice for Real
Estate," is America's largest trade association, representing 1
million members involved in all aspects of the residential and
commercial real estate industries.
* Large Companies With Insolvent Balance Sheet
----------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABT CN 120.5 (14.1) (11.1)
ADA-ES INC ADES US 92.5 (39.8) (11.0)
AK STEEL HLDG AKS US 3,906.1 (109.7) 604.0
AMC NETWORKS-A AMCX US 2,568.3 (825.3) 620.4
AMER AXLE & MFG AXL US 3,029.6 (107.9) 354.0
AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2)
AMERISTAR CASINO ASCA US 2,125.6 (2.6) (60.2)
AMR CORP AAMRQ US 23,852.0 (8,376.0) (2,465.0)
AMYLIN PHARMACEU AMLN US 1,998.7 (42.4) 263.0
ANACOR PHARMACEU ANAC US 37.4 (8.0) 9.5
ANGIE'S LIST INC ANGI US 108.3 (0.1) 3.3
ARRAY BIOPHARMA ARRY US 107.4 (52.4) 40.0
AUTOZONE INC AZO US 6,662.2 (1,550.1) (1,108.4)
BERRY PLASTICS G BERY US 5,082.0 (315.0) 517.0
CABLEVISION SY-A CVC US 7,143.2 (5,676.0) (266.5)
CAESARS ENTERTAI CZR US 27,475.0 (560.0) 1,227.1
CAPMARK FINANCIA CPMK US 20,085.1 (933.1) -
CC MEDIA-A CCMO US 15,519.2 (8,209.7) 1,053.5
CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1)
CHIMERIX INC CMRX US 26.3 (2.1) 15.9
CHINA XUEFENG EN CXEE US 0.0 (0.0) (0.0)
CHOICE HOTELS CHH US 546.0 (539.3) 56.8
CIENA CORP CIEN US 1,885.2 (78.6) 741.2
CINCINNATI BELL CBB US 2,151.5 (727.8) (93.4)
COMVERSE INC CNSI US 823.2 (28.4) (48.9)
DELTA AIR LI DAL US 45,068.0 (1,943.0) (5,427.0)
DENDREON CORP DNDN US 639.0 (35.9) 339.3
DEX MEDIA INC DXM US 2,658.8 (17.7) (13.5)
DIRECTV DTV US 20,650.0 (5,748.0) 69.0
DOMINO'S PIZZA DPZ US 476.6 (1,323.4) 85.0
DUN & BRADSTREET DNB US 1,902.0 (1,097.0) (194.9)
FAIRPOINT COMMUN FRP US 1,656.5 (360.7) 5.5
FERRELLGAS-LP FGP US 1,503.0 (42.3) (22.2)
FIFTH & PACIFIC FNP US 826.3 (170.2) (17.7)
FOREST OIL CORP FST US 1,895.0 (104.8) (127.8)
FREESCALE SEMICO FSL US 3,139.0 (4,540.0) 1,209.0
GENCORP INC GY US 1,385.2 (379.1) 32.0
GLG PARTNERS INC GLG US 400.0 (285.6) 156.9
GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9
GOLD RESERVE INC GRZ CN 78.3 (25.8) 56.9
GOLD RESERVE INC GDRZF US 78.3 (25.8) 56.9
GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5
HALOGEN SOFTWARE HGN CN 22.8 (46.2) (9.4)
HCA HOLDINGS INC HCA US 27,882.0 (8,012.0) 1,796.0
HOVNANIAN ENT-A HOV US 1,580.3 (481.2) 935.2
HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8)
HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8)
INCYTE CORP INCY US 330.3 (163.5) 178.7
INFOR US INC LWSN US 5,846.1 (480.0) (306.6)
INSYS THERAPEUTI NEOL US 14.5 (30.8) (41.8)
INSYS THERAPEUTI INSY US 14.5 (30.8) (41.8)
IPCS INC IPCS US 559.2 (33.0) 72.1
ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2
JUST ENERGY GROU JE CN 1,510.8 (273.1) (287.1)
JUST ENERGY GROU JE US 1,510.8 (273.1) (287.1)
L BRANDS INC LTD US 6,019.0 (1,014.0) 667.0
LIN TV CORP-CL A TVL US 1,201.4 (86.6) (101.7)
LORILLARD INC LO US 3,749.0 (1,796.0) 1,158.0
MANNKIND CORP MNKD US 215.2 (146.8) (231.9)
MARRIOTT INTL-A MAR US 6,523.0 (1,377.0) (732.0)
MDC PARTNERS-A MDCA US 1,418.5 (12.4) (165.9)
MDC PARTNERS-A MDZ/A CN 1,418.5 (12.4) (165.9)
MEDIA GENERAL-A MEG US 734.7 (191.7) 38.1
MERITOR INC MTOR US 2,337.0 (1,014.0) 208.0
MERRIMACK PHARMA MACK US 127.3 (32.1) 58.4
MONEYGRAM INTERN MGI US 4,892.0 (171.7) 14.1
MORGANS HOTEL GR MHGC US 583.6 (148.2) 110.7
MPG OFFICE TRUST MPG US 1,450.5 (530.6) -
NATIONAL CINEMED NCMI US 831.0 (308.8) 122.2
NAVISTAR INTL NAV US 8,531.0 (3,309.0) 1,517.0
NEKTAR THERAPEUT NKTR US 447.9 (2.6) 183.8
NPS PHARM INC NPSP US 188.5 (4.2) 133.4
NYMOX PHARMACEUT NYMX US 1.8 (7.4) (1.9)
ODYSSEY MARINE OMEX US 28.0 (7.1) (15.5)
OMEROS CORP OMER US 17.7 (15.9) 5.2
ORGANOVO HOLDING ONVO US 16.7 (5.3) (6.2)
PALM INC PALM US 1,007.2 (6.2) 141.7
PDL BIOPHARMA IN PDLI US 312.8 (93.7) 189.9
PHILIP MORRIS IN PM US 37,418.0 (2,732.0) 2,152.0
PHILIP MRS-BDR PHMO11B BZ 37,418.0 (2,732.0) 2,152.0
PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9)
PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9)
PROTECTION ONE PONE US 562.9 (61.8) (7.6)
QUALITY DISTRIBU QLTY US 510.5 (11.1) 88.5
RALLY SOFTWARE D RALY US 35.8 (1.1) 1.3
REGAL ENTERTAI-A RGC US 2,451.8 (706.2) 117.1
RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4)
RENTPATH INC PRM US 208.0 (91.7) 3.6
RESVERLOGIX CORP RVX CN 14.0 (20.2) (4.7)
REVLON INC-A REV US 1,241.9 (655.1) 152.9
RURAL/METRO CORP RURL US 303.7 (92.1) 72.4
SALLY BEAUTY HOL SBH US 1,892.1 (280.5) 523.4
SILVER SPRING NE SSNI US 494.3 (104.0) 60.1
SINCLAIR BROAD-A SBGI US 2,734.5 (97.3) (18.2)
SUPERVALU INC SVU US 11,034.0 (1,415.0) (1,380.0)
TAUBMAN CENTERS TCO US 3,302.5 (184.4) -
THRESHOLD PHARMA THLD US 113.9 (21.8) 88.3
TOWN SPORTS INTE CLUB US 406.2 (50.7) (13.2)
ULTRA PETROLEUM UPL US 2,035.4 (562.2) (293.0)
UNISYS CORP UIS US 2,323.2 (1,545.4) 453.1
VECTOR GROUP LTD VGR US 1,066.8 (108.3) 422.2
VERISIGN INC VRSN US 2,071.1 (39.1) (91.2)
VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3)
VISKASE COS I VKSC US 334.7 (3.4) 113.5
WEIGHT WATCHERS WTW US 1,314.7 (1,620.7) (312.5)
WEST CORP WSTC US 3,940.9 (850.2) 297.8
WESTMORELAND COA WLB US 943.0 (286.5) (3.0)
XOMA CORP XOMA US 88.9 (0.9) 60.6
YRC WORLDWIDE IN YRCW US 2,200.9 (642.6) 111.1
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers"
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors" Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez,
Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl
Joy P. Olano, Ivy B. Magdadaro, Carlo Fernandez, Christopher G.
Patalinghug, and Peter A. Chapman, Editors.
Copyright 2013. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000 or Nina Novak at 202-241-8200.
*** End of Transmission ***