/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/130625.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, June 25, 2013, Vol. 17, No. 174 Headlines 501 GRANT: Files Second Amended Disclosure Statement AFA INVESTMENT: Seeks Approval of Settlement with Key Creditors ALLIED NEVADA: S&P Revises Outlook to Negative & Affirms 'B' CCR AMG FACTORY: Voluntary Chapter 11 Case Summary ASPECT SOFTWARE: Debt Increase Cues Moody's to Cut CFR to 'B3' ATLS ACQUISITION: Seeks to Extend Plan Filing Deadline to Oct. 7 BLUEGREEN CORP: S&P Raises Corporate Credit Rating to 'B' BOSTON PROPERTIES: Fitch Currently Rates Preferred Stock 'BB+' CHANDY INC: Case Summary & 19 Largest Unsecured Creditors CHG HEALTHCARE: Moody's Rates $110MM Loan B1 & $40MM Loan Caa1 CMGT INC: 7th Circ. Affirms Toss of Mayer Brown Malpractice Suit CONTROLS INC: Case Summary & 2 Unsecured Creditors COREL CORP: S&P Affirms 'CCC+' Corp. Credit Rating; Outlook Stable DETROIT, MI: Emergency Manager Orr Orders Probe of Pensions DEWEY STRIP: Owner of 23 Acres on Las Vegas Strip in Ch. 11 DOWNSTREAM DEVELOPMENT: Moody's Cuts CFR to Caa1 on Poor Profits E-BIOFUELS: Imperial Finalizes Settlement on Debt Guarantee EASTMAN KODAK: BNY, Travelers File Objections to Plan Outline EASTMAN KODAK: Seeks Court Approval to Obtain $895 Million Loan EASTMAN KODAK: Asks Court to Approve Rights Offerings Procedures EASTMAN KODAK: Committee Wins Approval to Hire Buck as Consultant EASTMAN KODAK: Scores Deal to Avoid Environmental Liabilities EASTMAN KODAK: Drops Change in Ownership Provision in Exec. Plan EDISON MISSION: Approved to Refinance Viento Wind Power Projects ENERGY SERVICES: Forbearance with United Bank Extended to July 31 ENGLOBAL CORP: Expects to Release $7MM in Collateral to Lender ENPRO TECHNOLOGIES: Case Summary & 20 Largest Unsecured Creditors EVERGREEN OIL: Names Clean Harbors as Stalking Horse FOURTH QUARTER PROPERTIES: Can Obtain DIP Loans to Pay Appraiser FOURTH QUARTER PROPERTIES: Employs Pardue & Company as Appraiser HANDY HARDWARE: Littlejohn to Get Ownership via Plan HERON LAKE: Inks Management Services Agreement with EMS IMAGEWARE SYSTEMS: Bruce Toll Held 6.7% Equity Stake at June 18 IZEA INC: Obtains $170,000 Financing From Director JEH COMPANY: Hearing Today on Use of Frost Bank's Cash Collateral JERRY'S NUGGET: Asks Court to Extend Plan Solicitation Deadline JM SMUCKER: False Ad Plaintiff Can Recover Fees, Judge Rules K-V PHARMACEUTICAL: Exclusivity Tolled Over DIP Lenders' Objection K-V PHARMACEUTICAL: Settlement with Texas and Ven-A-Care Approved LEE BRICK: Has Until June 28 to Solicit Plan Votes LEHMAN BROTHERS: Brokerage Lawyers Awarded $62 Million LOGAN'S ROADHOUSE: Moody's Lowers CFR & Notes Rating to 'Caa2' LPATH INC: Stockholders Elect Six Directors MAIN STREET: No Bids Competing With Insiders to Buy Daily Voice MASTRO'S RESTAURANTS: S&P Raises CCR to 'B'; Outlook Stable MCCLATCHY COMPANY: Amends 2012 Annual Report MERIDIAN SUNRISE: Wants Cash Access Until Plan Effective Date MESA ACQUISITION: Voluntary Chapter 11 Case Summary MONARCH COMMUNITY: Gets Preliminary Approval of Recapitalization MOORE FREIGHT: Reaches Adequate Protection Terms with Creditors NEW ENTERPRISE: Moody's Changes Ratings Outlook to Negative OCEAN DRIVE: Court Dismisses Chapter 11 Cases OP-TECH ENVIRONMENTAL: Inks $6MM Financing Agreement with Accord ORCHARD SUPPLY: Section 341(a) Meeting Set on July 23 ORECK CORP: Wants to Hire Carl Marks as Crisis Manager ORECK CORP: Creditors Have Until Sept. 13 to File Claims ORECK CORP: Files Schedules of Assets and Liabilities OTTER TAIL: S&P Raises Senior Unsecured Debt Rating From 'BB+' PARK CENTER: Case Summary & Unsecured Creditors PERDUE PROPERTIES: Case Summary & 9 Unsecured Creditors PROFILE TECHNOLOGIES: WaveTrue Plan Takes Effect; Exits Chapter 11 PHOENIX COMPANIES: Moody's Eyes Downgrade for 'Caa1' Debt Rating PNM RESOURCES: Moody's Changes Ratings Outlook to Positive PROPHOTONIX LTD: Enters Into Credit Facility Agreement with Tiger REVSTONE INDUSTRIES: Committee Wants Units in Ch. 11 Before Sale ROCKWELL MEDICAL: Grants 310,000 Restricted Shares to Executives ROTECH HEALTHCARE: Douglas County Objects to 2nd Amended Plan ROTECH HEALTHCARE: Equity Committee Can Tap Baker as Counsel ROTECH HEALTHCARE: Equity Committee Can Tap Bifferato as Counsel ROTHSTEIN ROSENFELDT: Judge OKs Settlement Over Investor's Claims ROSETTA GENOMICS: Annual General Shareholders' Meeting on July 29 SAN BERNARDINO, CA: NPFGC Hires Weil Gotshal After Winston DQ SEVEN COUNTIES: Has Authority to Employ Hall Render as IT Counsel SMART ONLINE: Stockholders OK Name Change to "MobileSmith Inc." SOLYNDRA LLC: Lien Fight Must Stay in Delaware, Judge Says SPIRE CORP: Maturity of Silicon Valley Facility Moved to Aug. 30 STEBNER REAL ESTATE: Court Dismisses Chapter 11 Case STOCKTON, CA: NPFGC Hires Weil Gotshal After Winston DQ STX PAN OCEAN: Chapter 15 Case Summary SUNTECH POWER: European Subsidiary Granted Definitive Moratorium SUN RIVER: Joe Laakman Held 16.5% Equity Stake at March 19 T-L CHEROKEE: Files 100% Recovery Plan for Unsecured Creditors TMT USA: Seeks to Use Frozen Cash, Pay Critical Vendors TMT USA: Sues Lenders to Recover Seized Vessels TOUSA INC: Liquidating Plan Set for Aug. 1 Confirmation TRIAD GUARANTY: Hiring Approvals Sought TRIAD GUARANTY: Taps Donlin Recano as Claims & Noticing Agent UNI-PIXEL INC: Completes Build-Out of UniBoss Wet Lab Facility VAIL LAKE: Sec. 341 Creditors' Meeting Set for July 9 VERITY CORP: Take Flight Owned 19.6% Equity Stake at May 1 VHGI HOLDINGS: Obtains $65MM Replacement Financing From Al Rami VISTA HERMOSA: Case Summary & 3 Unsecured Creditors VISUALANT INC: Sues Ascendiant Over 1.7MM Undelivered Shares VITERA HEALTHCARE: S&P Assigns 'B' CCR; Outlook Negative VITESSE SEMICONDUCTOR: Offering 16.3 Million Common Shares VYSTAR CORP: Matthew Clark to Serve as Consultant VYSTAR CORP: Brio Capital Held 9.4% Equity Stake at June 18 WAVE SYSTEMS: Amends 1.8 Million Shares Resale Prospectus ZOGENIX INC: Stockholders Elect Two Directors * Bank of Tokyo to Pay $250MM to N.Y. in Money-Laundering Case * Federal Reserve Eyes End of Bond Buying * FTC Is Said to Plan Inquiry of Frivolous Patent Lawsuits * HSBC Unit Liability on Verdict $1.5 Billion, Lawyer Says * Libor Case Ensnares More Banks * Virginia Lawyer Gets 15 Years for SBA Loan Fraud * Moody's Reports on Covenant Protections for Metal Miners * Weil Gotshal Cuts 60 Associates, Reduces Pay for Some Partners * Large Companies With Insolvent Balance Sheets ********* 501 GRANT: Files Second Amended Disclosure Statement ---------------------------------------------------- 501 Grant Street Partners, LLC, filed a second amended disclosure statement explaining its Chapter 11 plan of reorganization, which contemplates the sale of 100% of the Debtor's equity to special purpose entity to be formed by Clarity Realty Partners LLC, a third-party investor, in exchange for an $18.23 million investment into the Debtor. Upon funding of the Plan, (a) the Debtor's secured obligation to SA Challenger, Inc., will be reduced to the current value of the property located at 501 Grant Street, in Philadelphia, Pennsylvania, restructured and repaid over time at market terms; (b) the Debtor's secured tax obligation, to the extent it remains outstanding, will be paid in full following the Effective Date of the Plan; (c) the Debtor's alleged mechanics lien holders will either be paid in full with interest, if the lien is valid, or otherwise receive the same treatment as the Debtor's general unsecured creditors; (d) the Debtor's priority tax claim will be paid in full on the Effective Date of the Plan; and (e) the Debtor's unsecured creditors, including the Lender's deficiency claim, will receive each creditor's pro rata share of $3,150,000 payable in 13 quarterly payments after the Effective Date of the Plan. If the Lender makes an election to treat its entire claim as secured pursuant to Section 1111(b) of the Bankruptcy Code, the repayment term of the restructured note will be extended until the time as the claim amount (estimated to be approx. $45 million) is paid. The funds allocated to unsecured creditors will then be paid until claims are paid in full and the remainder will be available for the reorganized Debtor for reserves and other needs of operation. A full-text copy of the Second Amended Disclosure Statement is available for free at http://bankrupt.com/misc/501GRANTds0612.pdf A hearing to consider the adequacy of the Second Amended Disclosure Statement will be held on June 26, 2013, at 02:00 PM. David B. Golubchik, Esq., at Levene, Neale, Bender, Yoo & Brill L.L.P., in Los Angeles, California, filed the Disclosure Statement on behalf of the Debtor. About 501 Grant An involuntary Chapter 11 bankruptcy petition was filed against 501 Grant Street Partners LLC, based in Woodland Hills, California (Bankr. C.D. Cal. Case No. 12-20066) on Nov. 14, 2012. 501 Grant Street Partners owns the Union Trust Building in downtown Pittsburgh, Pennsylvania. It sought Chapter 11 protection (Bankr. W.D. Pa. Case No. 12-23890) on Aug. 3, 2012, to avert a sheriff sale of the building. The August petition estimated under $50,000 in both assets and debts. In November 2012, U.S. Bankruptcy Judge Judith K. Fitzgerald dismissed 501 Grant Street Partners' Chapter 11 petition, paving for the sheriff sale of the Union Trust Building on Jan. 7, 2013. SA Challenger Inc., which acquired interest in the building's mortgage by U.S. Bank, has sought to foreclose on the Debtor's property. SA Challenger is seeking to collect $41.4 million. Earlier in November, at the lender's request, Judge Ward appointed the real estate firm CBRE to serve as receiver for the building, overseeing its operation and management until the sheriff sale takes place. The bankruptcy judge approved an involuntary Chapter 11 petition for 501 Grant, entering an order for relief on Dec. 13, 2012. The petitioning creditors are Allied Barton Security Services LLC, owed $960 for security services; Cost Company LP, $5,900 owed for masonry work; and MSA Systems Integration Inc., owed $2,401 for unpaid invoice. Malhar S. Pagay, Esq., at Pachulski Stang Ziehl & Jones LLP, represents the petitioning creditors. Attorneys at Levene, Neale, Bender, Yoo & Brill LLP, in Los Angeles, Calif., represent the Debtor in the involuntary Chapter 11 proceeding. AFA INVESTMENT: Seeks Approval of Settlement with Key Creditors --------------------------------------------------------------- AFA Investment, Inc., and its debtor affiliates ask the U.S. Bankruptcy Court for the U.S. Bankruptcy Court for the District of Delaware to approve a revised global settlement resolving substantially all key disputes between the Debtors and the settlement parties, namely the Official Committee of Unsecured Creditors, the Term B Loan Lenders, the Second Lien Agent, Beef Products, Inc., American Capital, Ltd., the other Second Lien Lenders and the claimants in the class action alleging violations of The Worker Adjustment and Retraining Notification Act. The revised settlement, which is a modification of the settlement entered in October last year, contemplates the entry of a final order authorizing the Debtors' use of cash collateral at the consent of the Second Lien Agent in accordance with the terms of a budget to be approved by the Second Lien Agent in its sole discretion. According to the Debtors, the revised settlement omits elements that the Court determined are appropriately reserved for a Chapter 11 plan or otherwise are improper. In particular, the Revised Settlement contains no waiver of Preference Claims. Rather, the Preference Claims and other claims under Sections 542, 543, 544, 545, 548, 550, 551 and 553 of the Bankruptcy Code now will be managed by a committee representing the interests of the WARN Claimants, Yucaipa Corporate Initiatives Fund II, LLC, and the Creditors' Committee, with the net proceeds of the Avoidance Actions being distributed, first, in a certain amount to the WARN Claimants; second, in a certain amount to the Second Lien Agent; and third, to the Debtors' estates. The Revised Settlement also resolves the disputed claims of ACAS and incorporates a settlement of the claims asserted (or that could have been asserted) by the WARN Claimants in the WARN Action. The recovery for the members of the putative class in the WARN Action will be funded solely by the first $1,650,000 in net recoveries from the Avoidance Actions. A full-text copy of the revised settlement dated June 14, 2013, is available for free at: http://bankrupt.com/misc/AFAINVESTMENTdeal0614.pdf A hearing on the request will be held on June 25, 2013, at 10:30 a.m. Peter J. Keane, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware; Tobias S. Keller, Esq., at Jones Day, in San Francisco, California; and Jeffrey B. Ellman, Esq., and Brett J. Berlin, Esq., at Jones Day, in Atlanta, Georgia, represent the Debtors. Brian J. Koenig, Esq., at Koley Jessen P.C., L.L.O., in Omaha, Nebraska, represent Beef Products, Inc., and NBPCo Holdings, LLC. Jeremy W. Ryan, Esq., at Potter Anderson & Corroon LLP, in Wilmington, Delaware, and Sean D. Malloy, Esq., and Scott N. Opincar, Esq., at McDonald Hopkins LLC, in Cleveland, Ohio, represent the Creditors' Committee. Robert J. Dehney, Esq., and Andrew R. Remming, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Deleware; and Thomas Walper, Esq., at Munger, Tolles & Olson LLP, in Los Angeles, California, represent Yucaipa, as Administrative Agent, the Term B Loan Lenders, and the special purpose vehicles. Frederick B. Rosner, Esq., and Julia Klein, Esq., at The Rosner Law Group LLC, in Wilmington, Delaware; and Jack A. Raisner, Esq., and Rene S. Roupinian, Esq., at Outten & Golden LLP, in New York, represent the WARN Claimants. Joseph M. Barry, Esq., at Young Conaway Stargatt Taylor, LLP, in Wilmington, Delaware; and Michael L. Bernstein, Esq., and Dana B. Yankowitz, Esq., at Arnold & Porter LLP, in Washington, D.C., represent ACAS. About AFA Investment King of Prussia, Pennsylvania-based AFA Foods Inc. was one of the largest processors of ground beef products in the United States. The Company had five processing facilities and two ancillary facilities across the country with annual processing capacity of 800 million pounds. AFA had seven facilities capable of producing 800 million pound of ground beef annually. Revenue in 2011 was $958 million. Yucaipa Cos. acquired the business in 2008 and currently owns 92% of the common stock and all of the preferred stock. AFA Foods, AFA Investment Inc. and other affiliates filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-11127) on April 2, 2012, after recent changes in the market for its ground beef products and the impact of negative media coverage related to boneless lean beef trimmings (BLBT) affected sales. Judge Mary Walrath presides over the case. Peter I Keane, Esq., Laura Davis Jones, Esq., Timothy P. Cairns, Esq., and Peter J. Keane, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware; Tobias S. Keller, Esq., at Jones Day, in San Francisco, California; and Jeffrey B. Ellman, Esq., and Brett J. Berlin, Esq., at Jones Day, in Atlanta, Georgia, represent the Debtors. FTI Consulting Inc. serves as financial advisors and Imperial Capital LLC serves as marketing consultants. Kurtzman Carson Consultants LLC serves as noticing and claims agent. As of Feb. 29, 2012, on a consolidated basis, the Debtors' books and records reflected approximately $219 million in assets and $197 million in liabilities. AFA Foods, Inc., disclosed $615,859,574 in assets and $544,499,689 in liabilities as of the Petition Date. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven members to the official committee of unsecured creditors in the Chapter 11 cases of AFA Investment Inc., AFA Foods and their debtor-affiliates. The Committee has obtained approval to hire McDonald Hopkins LLC as lead counsel and Potter Anderson & Corroon LLP serves as co-counsel. The Committee also obtained approval to retain J.H. Cohn LLP as its financial advisor, nunc pro tunc to April 13, 2012. AFA, in its Chapter 11 case, sold plants and paid off the first- lien lenders and the loan financing the Chapter 11 effort. Remaining assets are $14 million cash and the right to file lawsuits. General Electric Capital Corp. and Bank of America Corp. provided about $60 million in DIP financing. The loan was paid off in July. In October 2012, the Bankruptcy Court denied a settlement that would have released Yucaipa Cos., the owner and junior lender to AFA Foods, from claims and lawsuits the creditors might otherwise bring, in exchange for cash to pay unsecured creditors' claims under a liquidating Chapter 11 plan. Under the deal, Yucaipa would receive $11.2 million from the $14 million, with the remainder earmarked for unsecured creditors. Asset recoveries above $14 million would be split with Yucaipa receiving 90% and creditors 10%. Proceeds from lawsuits would be divided roughly 50-50. ALLIED NEVADA: S&P Revises Outlook to Negative & Affirms 'B' CCR ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its rating outlook on U.S.-based gold miner Allied Nevada Gold Corp. to negative from stable. At the same time, S&P affirmed the 'B' corporate credit rating on the company. In addition, S&P lowered its issue-level rating on the company's unsecured notes to 'B-' from 'B', in conjunction with its revision of the recovery rating to '5' from '3'. S&P revised its outlook to negative to reflect Allied Nevada's limited flexibility to absorb production shortfalls in 2013 given a recent drop in the price of gold. Leverage could exceed 5x EBITDA and liquidity could become constrained if the company misses its production targets or if gold prices drop further. The negative outlook reflects the potential that leverage could top 5x EBITDA and covenant cushion could tighten meaningfully under a number of scenarios that include another sharp drop in gold prices or production shortfalls (as occurred in 2012). S&P's base case scenario indicates that leverage would remain in the 4x to 5x range if gold prices recover to above $1,300 an ounce. However, this assumes the company hits the midpoint of its 225,000 to 250,000 ounce gold production guidance in 2013. A sustained price below $1,300 or another production shortfall would result in a downgrade. "We would revise our outlook to stable under conditions that include higher and relatively steady gold prices, with production in line with the company's guidance. In our view, this would result in EBITDA in excess of $110 million, with leverage less than 5x," said Standard & Poor's credit analyst James Fielding. In addition, the stable outlook would be predicated on expectations for higher gold production in 2014 to offset another likely capital raise such that Allied Nevada could fund additional capital expansion costs while maintaining leverage at less than 5x in 2014. AMG FACTORY: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: AMG Factory, LLC 7144 NW Progress Court Hillsboro, OR 97124 Bankruptcy Case No.: 13-33940 Chapter 11 Petition Date: June 19, 2013 Court: U.S. Bankruptcy Court District of Oregon Judge: Elizabeth L. Perris Debtor's Counsel: Nicholas J. Henderson, Esq. MOTSCHENBACHER & BLATTNER, LLP 117 SW Taylor Street, #200 Portland, OR 97204 Tel: (503) 417-0508 E-mail: nhenderson@portlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company's list of its largest unsecured creditors filed with the petition does not contain any entry. The petition was signed by Devin Wright, member. ASPECT SOFTWARE: Debt Increase Cues Moody's to Cut CFR to 'B3' -------------------------------------------------------------- Moody's Investors Service downgraded Aspect Software, Inc.'s corporate family rating to B3 from B2 and revised company's ratings outlook to stable from negative. The ratings of the first and second lien debt were also downgraded and the proposed delayed draw first lien rated B1. The downgrade was driven by the potential increase in debt and leverage with the proposed financing at a time when leverage is already high, cash flow weak and the company in the midst of attempting to offset significant declines in its legacy software business. The following ratings were downgraded: Corporate Family Rating -- to B3 from B2 Probability of Default Rating -- to B3-PD from B2-PD $30 million senior secured revolving facility due 2014 -- to B1, LGD2, 29% from Ba3, LGD3, 30% $408 million first lien term loan due 2016 -- to B1, LGD2, 29% from Ba3, LGD3, 30% $295 million second lien notes due 2017 -- to Caa2, LGD5 84% from Caa1, LGD5, 81% The following ratings were assigned: $85 million delayed draw first lien term loan due 2016 -- B1, LGD2, 29% Outlook: Stable Ratings Rationale: B3 rating reflects Moody's concern over Aspect's very high debt load at a time when the company faces challenges in turning around its revenues in the evolving contact center software market. Debt/EBITA before the debt increase is in the mid 6x range, and likely weakens further pro forma for the proposed debt increase, depending on EBITDA acquired using the cash raised. New debt further strains Aspect's weak credit metrics and free cash flow which has declined significantly since 2011. Aspect is expected to use the delayed draw loans to make acquisitions that strengthen its next generation product offerings. Success of new offerings, especially Tiger Shark, remains critical as Aspect battles declines in its legacy ACD ("Automatic Call Distribution") business. While Aspect's unified IP product, Tiger Shark, has exhibited encouraging bookings and average deal size trends, revenue currently generated does not completely offset the continued decline of Aspect's Signature and other legacy products. Aspect remains particularly exposed to being displaced from its legacy installed base as customers consider contact center purchases as part of enterprise wide PBX build-outs rather than stand-alone decisions - a shift that benefits some of Aspect's key competitors. While Moody's recognizes Aspect's longstanding leadership position in the contact center industry, the business is evolving and it is unclear if the landscape will favor Aspect's full suite hardware and software competitors. Moody's expects low single digits growth from the company's Work Force Optimization product line over the next twelve to eighteen months, helped by the company's approach towards providing integrated products compared to stand alone WFO competitors. Incentive programs will encourage some legacy customers to convert to Aspect's new products, but cash flow is expected to remain impacted in the medium term. While management has executed on various initiatives planned to refocus the business, decline in the legacy products continues to have a negative impact on results. Liquidity is adequate based on cash on hand, an undrawn $30 million revolver and expectations of positive free cash flow over the next twelve months. Covenant cushion remains thin but could be potentially helped by the proposed amendment. Amended covenants should allow more time to execute their plan though Moody's adjusted leverage will likely remain elevated and free cash flow will be well below historic levels in the interim. The ratings could be downgraded if revenues, EBITDA and free cash flow do not show signs of stabilizing and ultimately improving. Ratings could be upgraded if the company is able to grow revenues, EBITDA and cash flow and leverage is sustainably below 6x. The principal methodology used in this rating was Global Software Industry published in October 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Aspect is a provider of software systems for call centers with $433 million of revenue for the twelve months ended March 2013. The company, headquartered in Chelmsford, MA, is owned by private equity firm, Golden Gate Capital. ATLS ACQUISITION: Seeks to Extend Plan Filing Deadline to Oct. 7 ---------------------------------------------------------------- ATLS Acquisition LLC filed a motion with the U.S. Bankruptcy Court seeking to extend until Oct. 7, 2013, the deadline to file its Chapter 11 plan and disclosure statement. When the Debtors filed the Chapter 11 Cases, the Debtors recognized that there were a number of issues that needed to be resolved in order for the Debtors to determine the best strategy for maximizing the value in the Debtors' estates. Among other things, the Debtors intended to use these Chapter 11 Cases to (i) resolve a dispute regarding the scope of the Option Agreement, dated as of Dec. 3, 2012, by and between ATLS Acquisition, LLC and FGST Investments, Inc. on the one hand and the Alere Parties on the other, (ii) develop and implement a business plan for the remainder of the Debtors' business, (iii) resolve the outstanding recoupment claims asserted against the Debtors by CMS, (iv) resolve the litigation and/or the claims asserted in the Civil Litigation and (v) resolve certain claims against Medco related to the terms of the MBO Transaction. The Debtors understood that only after they made substantial progress on these issues could they determine the most effective way to resolve these Chapter 11 Cases. The Debtors have made progress on a number of those issues and intend to use the extension of the Exclusive Periods to make further progress on these issues. The Debtors believe that a further extension of the Exclusive Periods beyond the extensions requested in the current Motion will be necessary to resolve the issues in these Chapter 11 Cases. However, the Debtors have agreed with the Committee to shorter extensions of the Exclusive Periods -- that is, until October. That agreement is without prejudice to the Debtors' ability to seek further extensions and without prejudice to the Committee's right to contest such extensions or otherwise. Entities that own diabetics supply provider Liberty Medical led by ATLS Acquisition, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10262) on Feb. 15, 2013, just less than three months after a management buy-out and amid a notice by the lender who financed the transaction that it's exercising an option to acquire the business. Liberty has been in business for 22 years serving the needs of both type 1 and type 2 diabetic patients. Liberty is a mail order provider of diabetes testing supplies. In addition to diabetes testing supplies, the Debtors also sell insulin pumps and insulin pump supplies, ostomy, catheter and CPAP supplies and operate a large mail order pharmacy. Liberty operates in seven different locations and has 1,684 employees. The Debtors have tapped Greenberg Traurig, LLP as counsel; Ernst & Young LLP to provide investment banking advice; and Epiq Bankruptcy Solutions, LLC, as claims and noticing agent for the Clerk of the Bankruptcy Court. BLUEGREEN CORP: S&P Raises Corporate Credit Rating to 'B' --------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Boca Raton, Fl.-based Bluegreen Corp. to 'B' from 'B-'. The rating outlook is stable. "The upgrade reflects our expectation that financial policy decisions by Woodbridge Holdings LLC will not impair Bluegreen's liquidity position. As a result, we expect that Bluegreen's credit measures will be in line with the current 'B' rating over the intermediate term. Bluegreen recently completed the merger with BFC Financial Corp.'s subsidiary, Woodbridge Holdings LLC (which previously controlled 53% of Bluegreen's common stock at December 2012). Bluegreen issued $75 million of senior secured notes and used the proceeds, together with $14 million in cash, to fund a portion of the merger consideration. We currently expect that the financial policy of Woodbridge Holdings, specifically with regards to dividends, will not meaningfully impair Bluegreen's liquidity position. We believe Bluegreen will continue to remain in compliance with liquidity covenants found in its current credit facilities and that Bluegreen will maintain an adequate liquidity cushion relative to its near-term operating needs as a wholly owned subsidiary of Woodbridge Holdings," S&P said. In addition, the upgrade reflects improved operating performance and cash flow generation over the past several quarters due to an increase in commission-based sales of third-party timeshare inventory. In 2012, sales of third-party inventory were approximately 36% of system-wide sales, compared with 36% in 2011 and 27% in 2010. Fee-based revenue from sales of third-party inventory allows Bluegreen to expand the level of sales not requiring inventory development spending or financing by Bluegreen. As a result, adjusted debt to EBITDA improved to the low-4x area as of March 2013, which is good for the current rating. Although commission-based sales of third-party inventory have enhanced Bluegreen's profitability in recent periods, S&P continues to expect Bluegreen to rely heavily on its lines of credit, receivables-based warehouse facilities, and access to the timeshare securitization market to fund timeshare sales of Bluegreen developed inventory. S&P's corporate credit rating reflects its assessment of the company's business risk profile as "vulnerable" and its assessment of its financial risk profile as "aggressive," according to its criteria. S&P's business risk profile assessment of vulnerable reflects the capital-intensive nature of timeshare development and Bluegreen's need to finance a significant level of its sales activity. Dependence on consumer spending in order to drive growth also factored into S&P's assessment. Bluegreen develops, markets, and sells timeshare interests in 60 resorts, located primarily in the Southeast, Southwest, and Midwest regions of the U.S. S&P's assessment of Bluegreen's financial risk profile as aggressive reflects leverage S&P anticipates to be in the low-4x area in 2013 and a somewhat constrained long-term liquidity profile because of the company's reliance on securitization markets to periodically free up availability under short-term receivable-based facilities to finance its sales activity. In addition, Bluegreen faces the need to extend a portion of its receivable-based facility commitments or put into place additional lending sources over the near-to-intermediate term. S&P's financial risk assessment also takes into account its expectation that Bluegreen will maintain an adequate liquidity profile as a wholly owned subsidiary of Woodbridge Holdings LLC. BOSTON PROPERTIES: Fitch Currently Rates Preferred Stock 'BB+' -------------------------------------------------------------- Fitch Ratings has assigned a credit rating of 'BBB' to the $700 million 3.80% senior unsecured notes due Feb. 1, 2024 issued by Boston Properties, L.P., the operating partnership of Boston Properties, Inc. (NYSE: BXP; collectively, the company). The notes were issued at 99.694% of par to yield 3.835%. The notes were issued at a 165 basis point spread to Treasuries and net proceeds from the offering of $691.9 million will be used for general corporate purposes including investment opportunities and debt reduction. Fitch currently rates the company as follows: Boston Properties, Inc. -- Issuer Default Rating (IDR) 'BBB'; -- $200 million Preferred Stock 'BB+'. Boston Properties, L.P. -- IDR 'BBB'; -- $750 million unsecured revolving credit facility 'BBB'; -- $5.4 billion senior unsecured notes 'BBB'; -- $1.2 billion exchangeable senior unsecured notes 'BBB'. The Rating Outlook is Stable. Key Rating Drivers The ratings are supported by the company's superior asset quality, appropriate leverage and fixed-charge coverage for the rating. The ratings also reflect BXP's adequate liquidity position that is supported by its large unrestricted cash balance, retained free cash flow, near full availability under its $750 million revolving credit facility and its large unencumbered pool of high quality assets in markets with excellent transaction and financing liquidity characteristics. Fitch expects that BXP will continue to have access to a wide range of capital sources to help it meet its manageable debt maturity schedule and other financial obligations. The ratings are balanced by the company's moderately concentrated geographical footprint and related exposure to finance, legal and government and defense industry tenants. Execution and liquidity risk associated with the company's development platform are also a credit concern. Superior Asset Quality BXP owns a high-quality portfolio of predominantly class A office properties located in supply-constrained central business district (CBD) markets. The company's CBD properties compete for the highest profile tenants in their regions and many are leading properties in their submarkets, and would likely attract significant investor and lender interest, providing contingent liquidity to the company. Appropriate Leverage and Coverage BXP's net debt to recurring operating EBITDA for the trailing 12 months (TTM) was 6.7x as of March 31, 2013. Leverage was 6.8x in 2012, 6.3x in 2011 and 7.6x in 2010. Fitch assumes that leverage will be unchanged following the offering as Fitch expects proceeds to be used to repay outstanding unsecured debt. Fixed-charge coverage was 2.2x for the TTM ended March 31, 2013, compared to 2.1x in 2012, 2.2x in 2011 and 1.8x in 2010. The company's leverage and fixed-charge coverage are appropriate for a 'BBB' rated office REIT with BXP's large size and high asset quality. Long-Term Leases The company's revenue is supported by long-term leases. The company's in-service portfolio was 91.7% leased at March 31, 2013. BXP's lease profile is strong relative to its office REIT peers, which ensures that the company is not overly exposed to leasing risk at any given time, notwithstanding tenant bankruptcies. Average annual lease expirations comprise less than 8% of annualized base rent through 2022, with a maximum annual maturity of 13% in 2017. The company has historically been proactive in renewing tenants in advance of lease maturities to minimize downtime and leasing costs, which Fitch views as a risk adverse strategy that strengthens the credit by reducing cash flow volatility. Adequate Liquidity The company maintains an adequate liquidity position pro forma the $700 million unsecured notes issuance. For the period April 1, 2013 to Dec. 31, 2014, the company's base case liquidity coverage ratio is 1.5x. BXP's liquidity coverage would improve to 1.7x assuming the company refinances maturing mortgages at 80% of current balances. The $746 million of exchangeable notes that mature in Feb. 2014 represent the company's next largest funding requirement. Unfunded development commitments were the second largest use of capital at $670 million, not including the Transbay Tower in San Francisco for which Fitch anticipates the company will start below-grade construction in late 2013. BXP likely has some flexibility to defer spending if market conditions weaken unexpectedly and materially. BXP's liquidity coverage ratio would improve to 2.1x absent said expenditures. Fitch defines liquidity coverage as sources of liquidity (unrestricted cash, availability under the company's unsecured credit facility and expected retained cash flows from operating activities after dividends) divided by uses of liquidity (pro rata debt maturities, expected recurring capital expenditures and development costs). BXP maintains a large unencumbered pool of 124 assets that comprised 66% of NOI as of March 31, 2013. Fitch views the company's unencumbered asset base as a strong source of contingent liquidity that supports its unsecured obligations. Capitalizing annualized first quarter 2013 (1Q'13) cash NOI generated by the unencumbered pool at a stressed capitalization rate of 7% yields unencumbered asset coverage of approximately 2.1x, which is adequate for the 'BBB' IDR. Well-Laddered Debt Maturities BXP's debt maturities are generally well-laddered, with less than 10% of total debt maturing in any given year through 2016. The company does have an unusually large 17.2% of consolidated debt maturing in 2017 that increases to 24.2% of total debt maturing when including the $975 million of unconsolidated JV debt maturing at BXP's pro-rata share. Fitch views these maturities as an intermediate-term risk that is mitigated by the quality of the properties securing these mortgages, which include 599 Lexington Avenue and 767 Fifth Avenue (The GM Building) in Manhattan, and the John Hancock Tower in Boston. Significant Tenant Industry Concentration The company has elevated exposure to financial, legal and government related tenants in its portfolio. Tenants in these segments represented approximately 28%, 25% and 6% of gross rent, respectively, for a combined total of 59% as of March 31, 2013. Lower trading volumes and increased regulation are key issues that are challenging financial services companies resulting in delayed leasing decisions, at best, and, in many instances, led to reductions in space demand. Legal tenants continue to optimize their space needs and are often shrinking their office footprints when leases expire. Finally, the U.S. Government (BXP's largest tenant at 6.4% of leased square feet) and related government contractors are demanding less space due in large part to the impact sequestration, particularly within the Washington D.C. metro area. Development Risk Development is a key component of BXP's strategy and the company has historically allowed its pipeline of projects under construction to become a large percentage of its portfolio. For example, the total pipeline grew to 20.3% of total assets in 2Q'08, with the unfunded obligation representing 11% of total assets. The total estimated investment of BXP's development pipeline was $1.9 billion at March 31, 2013, which represented 10.1% of total assets with the unfunded portion comprising a materially smaller 3.6% of total assets. Fitch would view cautiously a pipeline that grows close to 20% of total assets or approaching 10% of remaining funding, absent significant pre- leasing. Preferred Stock Notching The two-notch differential between BXP's IDR and its preferred stock rating is consistent with Fitch's criteria for corporate entities with an IDR of 'BBB'. Based on Fitch's research on 'Treatment and Notching of Hybrids in Nonfinancial Corporate and REIT Credit Analysis,' these preferred securities are deeply subordinated and have loss absorption elements that would likely result in poor recoveries in the event of a corporate default. Stable Rating Outlook The Stable Outlook reflects Fitch's expectations that fixed-charge coverage and leverage will sustain at the current levels over the next 12-24 months. Rating Sensitivities The following factors could result in positive momentum in the ratings and/or Outlook: -- Fitch's expectation of fixed-charge coverage sustaining above 2.5x for several consecutive quarters (coverage was 2.2x for the TTM ended March 31, 2013); -- Fitch's expectation of net debt to recurring operating EBITDA sustaining below 5.5x (leverage was 6.7x as of March 31, 2013). Conversely, the following factors may result in negative momentum in the ratings and/or Outlook: -- Fitch's expectation of fixed-charge coverage sustaining below 1.7x; -- Fitch's expectation of net debt to recurring operating EBITDA sustaining above 7.0x; -- A liquidity shortfall. CHANDY INC: Case Summary & 19 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Chandy, Inc. 176 Cold Branch Road Eatonton, GA 31024 Bankruptcy Case No.: 13-51550 Chapter 11 Petition Date: June 19, 2013 Court: U.S. Bankruptcy Court Middle District of Georgia (Macon) Debtor's Counsel: Wesley J. Boyer, Esq. KATZ, FLATAU, POPSON AND BOYER, LLP 355 Cotton Avenue Macon, GA 31201 Tel: (478) 742-6481 E-mail: wjboyer_2000@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 19 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/gamb13-51550.pdf The petition was signed by Barry Chambers, president/CEO. CHG HEALTHCARE: Moody's Rates $110MM Loan B1 & $40MM Loan Caa1 -------------------------------------------------------------- Moody's Investors Service affirmed CHG Healthcare Services' existing credit ratings, including the B2 Corporate Family Rating. Additionally, Moody's assigned a B1 rating to a proposed $110 million first lien incremental term loan and a Caa1 rating to a proposed $40 million second lien incremental term loan. The ratings outlook remains stable. CHG will use proceeds from the incremental $150 million in debt, along with $15 million in balance sheet cash, to fund a $165 million special dividend to existing shareholders. Leonard Green & Partners and Ares Management acquired CHG in November 2012. Ratings Rationale: The B2 CFR reflects Moody's expectation that CHG will de-leverage to below 6x over the next 12-18 months, primarily through EBITDA growth. Moody's anticipates double-digit percentage revenue growth plus margin expansion due to strong end market demand for locum tenens (physician staffing). CHG is the clear market leader in this niche industry and continues to take share. The breadth of its specialty physician offerings and customer base, management's track record of meeting or exceeding operating expectations, and a good liquidity profile further support the rating. The travel nurse and allied staffing businesses are expected to benefit from cyclical improvements in the near-term despite increased competition. Nonetheless, a debt-funded dividend so soon after the LBO signifies highly aggressive sponsor financial policies. On a pro forma basis, total debt / EBITDA is about 7x at March 31, 2013. Revenue size, while growing, is still relatively small in comparison to more diverse competitors in the staffing industry. The stable outlook anticipates steady organic earnings growth with limited debt repayment. The ratings could be downgraded if CHG undertakes additional debt-funded dividends, liquidity deteriorates, or market share or margins compress such that Moody's expects total debt / EBITDA to be sustained above 6 times. Moody's could upgrade the ratings if CHG demonstrates a commitment to debt repayment such that total debt / EBITDA is expected to be maintained below 5x while maintaining steady organic earnings growth and a good liquidity profile. Ratings affirmed: Corporate Family Rating, B2 Probability of Default Rating, B2-PD $100 million first lien revolver due 2017, B1 (LGD3, 35%) $475 million first lien term loan due 2019, B1 (LGD3, 35%) $190 million second lien term loan due 2020, Caa1 (LGD5, 87%) Ratings assigned: Proposed $110 million first lien term loan due 2019, B1 (LGD3, 35%) Proposed $40 million second lien term loan due 2020, Caa1 (LGD5, 87%) All ratings are subject to Moody's review of final documentation. CHG is a provider of temporary healthcare staffing services to hospitals, physician practices and other healthcare settings in the US. CHG derives most of its revenues from locum tenens staffing. Revenues are expected to exceed $800 million in 2013. The principal methodology used in this rating was the Global Business & Consumer Service Industry Rating Methodology published in October 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. CMGT INC: 7th Circ. Affirms Toss of Mayer Brown Malpractice Suit ---------------------------------------------------------------- Stewart Bishop of BankruptcyLaw360 reported that the Seventh Circuit upheld the toss of a $17 million malpractice suit against Mayer Brown LLP stemming from a bankrupt health care management services company's financing deal gone awry, holding that the doctrine of judicial estoppel is flexible and doesn't lend itself to rigid rules. According to the report, a three-judge panel for the appeals court rejected CMGT Inc.'s bankruptcy trustee's argument that in tossing the suit, the district court wrongly applied judicial estoppel by attributing litigation positions to the estate that were previously taken by Spehar Capital, LLC. About CMGT Inc. In early 2004, Spehar Capital, LLC, a venture capital consulting firm, secured a $17 million default judgment against CMGT, Inc., in California state court. Seeking to recover the $17 million judgment, SC filed a single- creditor involuntary bankruptcy petition against CMGT in Illinois (Bankr. N.D. Ill. Case No. 04 B 31669). David Grochocinski, in his capacity as Chapter 7 Trustee for the bankruptcy estate of CMGT, sued Mayer Brown Rowe & Maw LLP and Ronald B. Given, one of its attorneys, for legal malpractice. CONTROLS INC: Case Summary & 2 Unsecured Creditors -------------------------------------------------- Debtor: Controls, Inc. 7643 Fullerton Road Springfield, VA 22153 Bankruptcy Case No.: 13-12855 Chapter 11 Petition Date: June 19, 2013 Court: U.S. Bankruptcy Court Eastern District of Virginia (Alexandria) Judge: Robert G. Mayer Debtor's Counsel: Ronald J. Aiani, Esq. RONALD J. AIANI, P.C. 86 East Lee Street Warrenton, VA 20186-3328 Tel: (540) 347-5295 E-mail: raiani@aianilaw.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 two largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/vaeb13-12855.pdf The petition was signed by Shawn Weingast, general manager. Affiliates that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Best Industries, Inc. 13-11554 04/05/13 Gunston Hall Realty, Inc. 13-11553 04/05/13 COREL CORP: S&P Affirms 'CCC+' Corp. Credit Rating; Outlook Stable ------------------------------------------------------------------ Standard & Poor's Ratings Services said it affirmed its ratings on packaged software provider Corel Corp., including its 'CCC+' long- term corporate credit rating on the company. The outlook is stable. Subsequently, Standard & Poor's withdrew its ratings on Corel at the company's request. DETROIT, MI: Emergency Manager Orr Orders Probe of Pensions ----------------------------------------------------------- Matthew Dolan, writing for The Wall Street Journal, reported that the emergency manager for Detroit ordered a financial probe of the city's pension funds, a move that could lead to a takeover of the system in this city on the edge of bankruptcy. According to the WSJ report, Emergency Manager Kevyn Orr signed the order directing the city's inspector general and auditor general to investigate the city's two pension funds "to identity any waste, abuse, fraud or corruption, including but not limited to, administrative misfeasance or other impropriety." Under Michigan law, Mr. Orr with other state officials could take over the system by replacing its trustees if he finds that the pension funds are substantially underfunded, the report related. Finding gross mismanagement or criminal activity could also strengthen Mr. Orr's hand to appoint new trustees or even become the sole trustee himself, which would let him to manage the assets of the system, according to a person familiar with the matter. If he takes over the system, Mr. Orr might have an easier time of prodding the funds' recipients into accepting concessions he has proposed to save the city billions of dollars as part of a broader restructuring of Detroit's nearly $20 billion in liabilities, the report said. The person familiar with the matter said it isn't likely that Mr. Orr would have the sole power to impose a new pension system. He would still need agreements with unions and retirees to change pensions, this person said. Mr. Orr's actions could escalate tensions with the city's public employee unions, according to WSJ. Under Mr. Orr's plan, billions in pension and health-care benefits -- as well as some payments to bondholders -- would be cut in part to plow money into improved services for the city's residents. DEWEY STRIP: Owner of 23 Acres on Las Vegas Strip in Ch. 11 ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Dewey Strip Holdings LLC and an affiliate, which together own 23 acres on the Las Vegas Strip, filed Chapter 11 petitions early this month in Delaware. Purchased before the recession, the two largely vacant parcels were intended for redevelopment. One parcel of 18 acres is on the southern end of the strip near Mandalay Bay. The second, with 5 acres, is in the central part of the strip near the Encore Hotel. Court papers peg the value of each parcel at less than $50 million. The report discloses that the properties are subject to a $250 million first-mortgage owing to Wells Fargo Bank NA. There is a junior mortgage for $28.3 million. About Dewey Strip Las Vegas, Nevada-based Dewey Strip Holdings LLC and Las Vegas North Strip Holdings Syndications Group LLC sought Chapter 11 protection (Bankr. D. Del. Case Nos. 13-11479 and 13-11480) on June 7 in Delaware, without stating a reason. Each debtor, a Single Asset Real Estate as defined in 11 U.S.C. Sec. 101(51B), estimated at least $10 million in assets and at least $100 million in liabilities. The Debtors are represented by Womble Carlyle Sandridge & Rise, LLP as bankruptcy counsel. The petitions were signed by Martin H. Walrath, IV, vice-president of International Property Syndications, Ltd., as manager and sole member. DOWNSTREAM DEVELOPMENT: Moody's Cuts CFR to Caa1 on Poor Profits ---------------------------------------------------------------- Moody's Investors Service downgraded Downstream Development Authority's Corporate Family Rating to Caa1 from B3, its Probability of Default Rating to Caa1-PD from B3-PD, and the rating on its senior secured notes to Caa1 from B3. The company's rating outlook is negative. The downgrade reflects Downstream's deterioration in its operating performance following the opening of its new hotel tower in December 2012 and its weak liquidity profile. Moody's estimates Downstream's EBITDA declined approximately 10% in the second quarter of fiscal 2013 (three months ended March 31, 2013) versus the prior year despite the addition of the new hotel tower. Preliminary indications are that the cost of the new hotel tower has not successfully been offset with additional gaming revenue. The downgrade also considers that the decline in earnings will negatively affect Downstream's free cash flow just at the time when mandatory amortization for the company's $35 million delayed draw term loan used to build the new hotel tower is scheduled to begin. Effective June 30, 2013 the delayed draw term loan will amortize at $1.75 million per quarter. In Moody's estimation, projected 2013 EBITDA of approximately $60 million will be sufficient to cover fixed charges of approximately $56 million (including interest expense, mandatory amortization, maintenance capex and tribal distributions). However, there is not much cushion to allow for further deterioration in the company's operating performance, especially given likely to maintain only minimal cash balances (excluding cage cash) after tribal distributions. The negative outlook reflects Moody's view that Downstream will need to seek an amendment/waiver for its leverage and/or fixed charge coverage financial covenants as early as the quarter ended June 30, 2013. The deterioration in Downstream's earnings is expected to cause the company to violate its leverage coverage which steps down each quarter in 2013. The following rating actions were taken: Corporate Family Rating, downgraded to Caa1 from B3; Probability of Default Rating, downgraded to Caa1-PD from B3-PD; $295 million senior secured notes, due 2019, downgraded to Caa1 (LGD 4, 51%) from B3 (LGD 4, 50%). Rating Rationale: Downstream's Caa1 Corporate Family Rating reflects its weak liquidity profile, small size, single asset profile, and high debt leverage. Moody's expects the Downstream's debt/EBITDA to remain above 5.5 times over the next 12 months, a level it considers high given Downstream's small size and lack of diversification. Additionally, Moody's rating incorporates other unique risks associated with Native American gaming operators, including uncertainty as to enforceability of lender's claims in bankruptcy and liquidation. Positive rating consideration is given to Downstream's limited direct competition at this time. Downstream's rating could be downgraded if it is not able to successfully negotiate long-term covenant relief or if its liquidity deteriorates further. Downstream's ratings could face upward pressure if the company's liquidity profile improves and debt to EBITDA is sustained below 5 times and EBITA to interest expense is sustained above 1x. The principal methodology used in this rating was the Global Gaming 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. The Downstream Development Authority is a wholly owned unincorporated instrumentality of the Quapaw Tribe of Oklahoma, a federally-recognized Native American tribe with approximately 3,400 enrolled members. Downstream owns and operates the Downstream Casino Resort, a Native American casino located at the point where the state borders for Kansas, Missouri and Oklahoma meet. E-BIOFUELS: Imperial Finalizes Settlement on Debt Guarantee ----------------------------------------------------------- Imperial Petroleum, Inc. said it finalized its settlement agreement with the bank in connection with the guarantee of the debt of e-Biofuels. The final settlement removed any contingency for the sale of the e-Biofuels facility. The payment date of the settlement amount of $1.0 million due to the bank remains on or before Dec. 31, 2015. Imperial is working with the bank under the supervision of the Indiana Department of Environmental Management to remove any and all remaining chemicals and materials held in tanks and other containers at the e-Biofuels facility to allow the facility to be sold. Imperial completed and the bankruptcy court approved a settlement with the Bankruptcy Trustee for the e-Biofuels bankruptcy estate concerning a claim by the Trustee for $242,000 in intercompany transfers made by e-Biofuels. Under the terms of the settlement, Imperial will pay the total amount claimed in scheduled monthly payments through May 2014. Imperial signed two agreements with Archer Petroleum Corp. to effect the sale of a 25% interest in the Peak Joint Venture for 500,000 shares of Archer restricted common stock and for the sale of certain international manufacturing and marketing rights for SANDKLENE 950 for $400,000 in cash, subject to a royalty arrangement and the reservation by the Company of certain existing customers. Imperial will retain 25% of the Peak Joint Venture project and will retain the rights to manufacture and sell SANDKLENE 950 in the United States and internationally to its existing customers. Closing is scheduled for July 15, 2013 and June 28, 2013 respectively, subject to the approval of the TSX Exchange. Jeffrey Wilson, president of Imperial, said, "We are continuing to work toward settling any outstanding claims and disputes that arose as a result of the bankruptcy filing of e-Biofuels. Our sale of part of the Peak Joint Venture and certain international rights associated with SANDKLENE 950 is intended to provide us with much needed working capital and another development partner for the Peak Mine, once permitting is completed. The development of the Stampede Mine, while slower than we had hoped, is now accelerating with the arrival and installation of major equipment items, completion of the tank battery work and installation of piping and electrical systems. Our new target date for startup is July 2013 subject to continued weather issues and equipment delivery delays." About e-Biofuels e-Biofuels, LLC, a wholly owned subsidiary of Imperial Petroleum, Inc., filed a Chapter 7 petition (Bankr. S.D. Ind. Case No. 12- 03816) on April 4, 2012. e-Biofuels disclosed assets of $11.4 million and liabilities of $17,3 million. e-Biofuels is a biodiesel producer located at east of Anderson, Central Indiana. E-biofuels began operating in 2007 and had the capacity to produce 10 million gallons of biodiesel per year. The Debtor is represented by: Jerald I. Ancel, Esq. TAFT STETTINIUS & HOLLISTER LLP One Indiana Sq., Suite 3500 Indianapolis, IN 46204 Tel: 317-713-3500 Fax: 317-713-3699 E-mail: jancel@taftlaw.com The trustee appointed by the Court to oversee the e-Biofuels bankruptcy proceedings is: Richard E. Boston 27 N 8th St Richmond, IN 47374 Tel: 765-962-7527 E-mail: rebch7@bbkcc.com EASTMAN KODAK: BNY, Travelers File Objections to Plan Outline ------------------------------------------------------------- The Bank of New York Mellon asked U.S. Bankruptcy Judge Allan Gropper to deny approval of the outline of Eastman Kodak Co.'s proposed Chapter 11 reorganization plan. The bank said the outline or the so-called disclosure statement doesn't have sufficient information about the treatment of its agreements with Kodak and Qualex Inc., a Kodak subsidiary, to form a trust where assets of the companies' pension plans are held. BNY Mellon also questioned a provision of the restructuring plan, which releases third parties from various claims. Another creditor, Travelers Casualty & Surety Co. of America, also criticized Kodak for giving insufficient information about the treatment of their indemnity agreement. The agreement required Kodak to indemnify Travelers for any loss suffered from the issuance of surety bonds with respect to various obligations of the company. Judge Gropper will hold a court hearing on June 25 to consider approval of the disclosure statement. Kodak must first gain court approval for the plan outline before it can solicit votes from creditors. A majority must vote to accept the plan before the bankruptcy judge can hold a hearing to consider confirmation of the plan. Kodak's latest plan outline filed on Friday now calls for a $406 million rights offering. Under the proposed rights offering, the company will issue up to 34 million shares of common stock at $11.94 each, equal to about 85% of the equity of a restructured Kodak. The company will use the proceeds from the sale of new common shares to pay off holders of second-lien notes owed $375 million. These noteholders will now receive cash instead of equity in a restructured Kodak, according to the latest outline. Unsecured creditors and retirees who are owed $2.8 billion could purchase up to six million shares of Kodak's new common shares under the rights offering. GSO Capital Partners, BlueMountain Capital, George Karfunkel, United Equities Group and Contrarian Capital have agreed to backstop the rights offering. A copy of the revised disclosure statement is available without charge at http://is.gd/K4szPj Revised Disclosures Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Eastman Kodak Co. prepared for the June 25 bankruptcy court hearing by filing a revised disclosure statement on June 21 showing the reorganized company as having an equity value of $4.98 to $15.77 a share. The report relates that by contrast, creditors will pay $11.94 for each share in the rights offering helping to fund the plan by generating $406 million. The valuation was prepared for Kodak by Lazard Freres & Co. Assuming the hearing goes ahead, the bankruptcy judge in New York will decide June 25 whether the newly revised disclosure statement adequately describes the amended plan filed last week. The plan was changed to pay off second-lien noteholders rather than give them 85 percent of the reorganized company's stock. Now, that stock is for purchase by creditors in the rights offerings tentatively scheduled to begin July 8 and end Aug. 9. According to the report, the new disclosure statement contains a liquidation analysis. Based on an assumption that none of the still operating businesses would be sold as a going concern, creditors are told that junior lenders in the bankruptcy case would only recover 29 percent. Everyone else of lower priority would receive nothing, including unsecured creditors and claims arising during Chapter 11. The report relates that Lazard pegged reorganized Kodak's enterprise value at $800 million to $1.25 billion. The distributable value worked out to $1.487 billion to $1.955 billion, taking into account the enterprise value and $609 million in excess cash, among other considerations. The plan, as filed last week, proposes a settlement to second-lien noteholders where they would receive principal and interest in cash, at the non- default rate, and $20 million in lieu of their claims for a make- whole premium. If the note holder class rejects the plan, they will be treated as not being affected, thus giving the bankruptcy judge responsibility for deciding how much of their claims for default interest and make whole are proper. The report says that the disclosure statement now shows unsecured creditors as having $1.6 billion to $2.2 billion in claims and a projected recovery of 4 percent to 5 percent. For their $635 million in claims for loss of retirement benefits, retirees are shown a similar projected recovery. Unsecured creditors and benefit claim holders are to receive 15 percent of the stock and the right to participate in the rights offering for six million of the 34 million shares in the offering. They also are to have warrants exercisable at 125 percent and 135 percent of the $11.94 a share price in the offering. The report relays that the other 28 million shares in the rights offering are exclusively for creditors who quality as so-called accredited investors and qualified institutional buyers with claims exceeding $100,000 and $500,000, respectively. In return for a 5 percent commitment fee, creditors GSO Capital Partners LP, BlueMountain Capital Inc., George Karfunkel, United Equities Group and Contrarian Capital are backstopping the right offerings. They will purchase any shares not taken by other creditors. The revised disclosure statement explains a settlement with New York environmental regulators regarding the campus in Rochester. Kodak will fund a trust with $49 million. The trust will take over liability for environmental remediation. The trust is already about half funded. The report says that in addition, Kodak said it's near settlement with representatives of non-qualified pension plans where they will have $244 million in unsecured claims. Funding for the plan and reorganized Kodak will derive from the $406 million rights offering and $895 million in bank financing. The plan entails so- called substantive consolidation. The company said it would be impossible to treat creditors of the multitude of subsidiaries separately. Consequently, all creditors are treated alike regardless of the debt and assets of a particular Kodak company. 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. EASTMAN KODAK: Seeks Court Approval to Obtain $895 Million Loan --------------------------------------------------------------- Eastman Kodak Co. asks U.S. Bankruptcy Judge Allan Gropper to approve the agreements it reached with major financial institutions to arrange an $895 million in new financing. Kodak will use the new loans to finance its exit from Chapter 11 protection, pay back its secured creditors under the current debtor-in-possession loan facilities, and meet the company's post- emergence working capital and liquidity needs. Pursuant to the agreements, affiliates of Bank of America, Merrill Lynch, JPMorgan, and Barclays Bank will serve as joint lead arrangers for senior secured term loans of up to $695 million, and for a new senior secured asset-based revolving credit facility of up to $200 million. The banks have also committed to provide $130 million of the revolving credit facility, which is conditioned on, among other things, the receipt of additional commitments from other lenders in an amount not less than $45 million. The new term loan will consist of a six-year $420 million senior secured first lien term loan facility, and a seven-year $275 million senior secured second lien term loan facility. Under Kodak's Chapter 11 reorganization plan, the proceeds of the term loan would be used to repay the company's DIP loan. "The new financing, combined with other recent significant milestones in our restructuring -? including the rights offering, Amended Plan of Reorganization, and Eastman Business Park settlement ?- will position Kodak for a bright long-term future," Kodak Chief Executive Antonio Perez said in a statement. The proposed financing is expected to provide Kodak with more favorable terms compared to the existing rollover exit financing commitment, according to Kodak lawyer, Andrew Dietderich, Esq., at Sullivan & Cromwell LLP, in New York. Mr. Dietderich said the rollover exit financing only addressed Kodak's term loan financing requirements, and did not contain an asset-based revolving facility, which the restructured Kodak will require for working capital purposes and to operate in the ordinary course. The financing agreements are subject to conditions, including approval by the bankruptcy court, completion of financing documentation, and a successful syndication in the loan markets. A redacted copy of the agreements is available without charge at: http://bankrupt.com/misc/Kodak_LetterRevolvingLoan.pdf http://bankrupt.com/misc/Kodak_LetterTermLoan.pdf Judge Gropper will hold a hearing on June 25, at 2:00 p.m. (Eastern Time). 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 EASTMAN KODAK: Asks Court to Approve Rights Offerings Procedures ---------------------------------------------------------------- Eastman Kodak Co. asked U.S. Bankruptcy Judge Allan Gropper to approve its proposed procedures for the conduct of two rights offerings that will be implemented in connection with its Chapter 11 reorganization plan. The rights offerings contemplate two distributions of subscription rights entitling Kodak's eligible unsecured creditors to purchase a total of up to 34 million shares of common stock in a reorganized Kodak at $11.94 each. The first rights offering will offer holders of general unsecured claims and the "retiree settlement unsecured claim" the opportunity to purchase each holder's pro rata share of six million shares of new common stock. In the other rights offering, creditors that qualify as "accredited investors" or "qualified institutional buyers" will be offered the opportunity to purchase between 28 million and 34 million shares of new common stock at $11.94 each. Both rights offerings are set to expire on August 9, at 5:00 p.m. Kodak will use the proceeds from the sale of new common shares to pay off bondholders owed $375 million. GSO Capital Partners, BlueMountain Capital, George Karfunkel, United Equities Group and Contrarian Capital have agreed to backstop the rights offerings. A copy of the document detailing the proposed procedures can be accessed for free at http://is.gd/rVTJgn Judge Gropper will hold a hearing on June 25, at 2:00 p.m. (Eastern Time). 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. EASTMAN KODAK: Committee Wins Approval to Hire Buck as Consultant ----------------------------------------------------------------- Eastman Kodak Co.'s official committee of unsecured creditors received the green light from U.S. Bankruptcy Judge Allan Gropper to hire Buck Consultants LLC as its actuarial consultant. The firm will provide actuarial consulting services in connection with the retirement plans sponsored by Kodak and its subsidiaries, and assist the committee in evaluating the companies' worldwide pension liabilities. 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. EASTMAN KODAK: Scores Deal to Avoid Environmental Liabilities ------------------------------------------------------------- Maria Chutchian of BankruptcyLaw360 reported that Eastman Kodak Co. landed a deal with the New York Department of Environmental Conservation that will protect it against environmental liabilities related to the 1,200-acre industrial complex it is selling for $8.5 million. According to the report, under the terms of the deal, the bankrupt company will set up a trust for the remediation of environmental conditions at Eastman Business Park and the Genesee River. The trust will be partly funded by the proceeds of the sale of the park to Red-Rochester LLC, the report added. 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. EASTMAN KODAK: Drops Change in Ownership Provision in Exec. Plan ---------------------------------------------------------------- Eastman Kodak Company, on June 20, 2013, amended the Executive Compensation for Excellence and Leadership Plan to remove its change in ownership and change in control provisions. 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. EDISON MISSION: Approved to Refinance Viento Wind Power Projects ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Edison Mission Energy received authorization last week from the bankruptcy court in Chicago to refinance non- bankrupt subsidiary Viento Funding II Inc. The refinancing allows Viento to take down a larger credit, provide cash to EME and remove EME's bankruptcy as a default on Viento's loan. Viento owns all or part of three wind-power projects. 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. EME said it doesn't plan to emerge from Chapter 11 until December 2014 to receive benefits from a tax-sharing agreement with parent Edison International Inc. ENERGY SERVICES: Forbearance with United Bank Extended to July 31 ----------------------------------------------------------------- Energy Services of America Corp. has obtained an extension until July 31, 2013, to raise funds and perform certain of its obligations under the forbearance agreement with United Bank, Inc., dated Nov. 28, 2012. Pursuant to the Forbearance Agreement, the Company and its subsidiaries acknowledge that they are in default under the terms of two credit facilities. United Bank has agreed to forbear from exercising certain of its rights and remedies under the loan agreements and related documents. A copy of the Amended Forbearance Agreement is available at: http://is.gd/3by5r6 About Energy Services Huntington, West Virginia-based Energy Services of America Corporation provides contracting services to America's energy providers, primarily the gas and electricity providers. The Company reported a net loss of $48.5 million on $157.7 million of revenue in fiscal 2012, compared with a net loss of $5.3 million on $143.4 million of revenue in fiscal 2011. The Company's balance sheet at March 31, 2013, showed $50.19 million in total assets, $45.69 million in total liabilities and $4.50 million in total stockholders' equity. Arnett Foster Toothman PLLC, in Charleston, West Virginia, expressed substantial doubt about Energy Services' ability to continue as a going concern following the annual report for the year ended Sept. 30 ,2012. The independent auditors noted that the Company has suffered recurring losses from operations and has entered into a forbearance arrangement with its lenders as a result of continued noncompliance with certain debt covenants. ENGLOBAL CORP: Expects to Release $7MM in Collateral to Lender -------------------------------------------------------------- ENGlobal Corporation's lenders issued $12.8 million in letters of credit to a client in July 2011 on the Company's behalf to support its performance on an international Automation project. These performance letters of credit were issued outside of the Company's working capital facility with its current senior lender. On June 17, 2013, its Performance Letters of Credit were allowed to expire. The Company has proposed an alternative option to modify terms of future retention amounts to replace the Performance Letters of Credit, which is currently under consideration. As a result, the Company expects its project-specific credit agreement will be terminated and approximately $7.1 million in collateral will be released to its senior lender. About ENGlobal Headquartered in Houston, Texas, ENGlobal -- http://www.ENGlobal.com-- is a provider of engineering and related project services principally to the energy sector throughout the United States and internationally. ENGlobal operates through two business segments: Automation and Engineering & Construction. ENGlobal's Automation segment provides services related to the design, fabrication and implementation of process distributed control and analyzer systems, advanced automation, and related information technology. The Engineering & Construction segment provides consulting services relating to the development, management and execution of projects requiring professional engineering as well as inspection, construction management, mechanical integrity, field support, quality assurance and plant asset management. ENGlobal currently has approximately 1,400 employees in 11 offices and 9 cities. The Company's balance sheet at March 30, 2013, showed $70.79 million in total assets, $43.51 million in total liabilties, all current, and $27.28 million in total stockholders' equity. Going Concern "The Company has been operating under difficult circumstances since the beginning of 2012. For the year ended December 29, 2012, the Company reported a net loss of approximately $33.6 million that included a non-cash charge of approximately $16.9 million relating to a goodwill impairment and a non-cash charge of approximately $6.8 million relating to a valuation allowance established in connection with the Company's deferred tax assets. During 2012, our net borrowings under our revolving credit facilities increased approximately $10.5 million to fund our operations. Due to challenging market conditions, our revenues and profitability declined during 2012 and continued to weaken through the first quarter of 2013. As a result, we have failed to comply with several financial covenants under our credit facilities resulting in defaults. Although we have sold assets, reduced debt and decreased personnel in an attempt to improve our liquidity position, we cannot assure you that we will be successful in obtaining the cure or waiver of the defaults under our credit facilities. If we fail to obtain the cure or waiver of the defaults under the facilities, the lenders may exercise any and all rights and remedies available to them under their respective agreements, including demanding immediate repayment of all amounts then outstanding or initiating foreclosure or insolvency proceedings. In such event and if we are unable to obtain alternative financing, our business will be materially and adversely affected, and we may be forced to sharply curtail or cease our operations. As a part of our efforts to improve our cash flow and restore our financial relationship with our lenders under the PNC Credit Facility, we engaged an investment banking firm to pursue strategic alternatives on behalf of the Company and a consulting firm to assist the Company with cost cutting efforts. These circumstances raise substantial doubt about the Company's ability to continue as a going concern." ENPRO TECHNOLOGIES: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: EnPro Technologies, LTD 4225 NE Port Drive Lees Summit, MO 64064 Bankruptcy Case No.: 13-42286 Chapter 11 Petition Date: June 19, 2013 Court: U.S. Bankruptcy Court Western District of Missouri (Kansas City) Judge: Cynthia A. Norton Debtor's Counsel: Colin N. Gotham, Esq. EVANS & MULLINIX, P.A. 7225 Renner Road, Suite 200 Shawnee, KS 66217 Tel: (913) 962-8700 Fax: (913) 962-8701 E-mail: colin@evans-mullinix.com Debtor's Accountant: OSKVIG ACCOUNTING, INC. Scheduled Assets: $1,815,000 Scheduled Liabilities: $3,060,331 A copy of the Company's list of its 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/mowb13-42286.pdf The petition was signed by Thomas G. Holzbaur, president. EVERGREEN OIL: Names Clean Harbors as Stalking Horse ---------------------------------------------------- Maria Chutchian of BankruptcyLaw360 reported that bankrupt waste oil collector Evergreen Oil Inc. selected Clean Harbors Inc. as the stalking horse bidder for nearly all of its assets after the company came forward with an offer that includes $60 million in cash. According to the report, Evergreen says the cash and other consideration, which includes an estimated $4.5 million for its trade receivables, offered by Clean Harbors will be used to pay the company's creditors under its Chapter 11 reorganization plan. About Evergreen Oil Headquartered in Irvine, California, with facilities located in Newark and Carson, California, Evergreen Oil Inc. is one of the largest waste oil collectors in California, and the only oil re-refining operation in California. Founded in 1984, EOI is also a major provider of hazardous waste services, offering customers across California a full range of environmental services to handle all of their waste management needs. Evergreen Oil and its parent, Evergreen Environmental Holdings, Inc., sought Chapter 11 protection (Bankr. C.D. Cal. Case Nos. 13-13163 and 13-13168) on April 9, 2013, in Santa Ana California. The Debtors on the petition date filed applications to employ Levene, Neale, Bender, Yoo & Brill L.L.P. as bankruptcy counsel; Jeffer, Mangels Butler & Mitchell L.L.P. as special corporate counsel effective; and Cappello Capital Corp. as exclusive investment banker. The Debtors each estimated assets and debts of $50 million to $100 million. According to the docket, the formal schedules of assets and liabilities are due April 23, 2013. FOURTH QUARTER PROPERTIES: Can Obtain DIP Loans to Pay Appraiser ---------------------------------------------------------------- Judge W. Homer Drake of the U.S. Bankruptcy Court for the Northern District of Georgia, Newnan Division, authorized Fourth Quarter Properties XXXVIII, LLC, to obtain debtor-in-possession financing to pay solely for the services of hiring an appraiser and testify regarding the value of the real estate collateral, and for attorney's fees and expenses. Judge Drake, in a separate order, authorized the Debtor to use, on an interim basis, cash collateral securing its prepetition indebtedness only to pay (i) monthly payments to Charter Bank and Cornerstone Commercial Mortgages, LLC, as required under Section 362(d)(3)(B) of the Bankruptcy Code, and (ii) quarterly fees owed to the Office of the United States Trustee. Cornerstone previously objected to the Debtor's motion for authority to use the cash collateral. Among other things, Cornerstone objects to the Debtor's use of cash collateral to pay utilities and maintenance expenses of those parts of its property which leases to three affiliates, in accordance with written leases the Debtor and those affiliates entered effective May 1, 2013. Prior to the hearing, the Debtor, Cornerstone and Charter Bank reached a resolution of the Cash Collateral Motion and the objection, and Cornerstone and Charter Bank have consented to the entry of the Interim Cash Collateral Order. As part of the resolution, the Debtor has agreed to amend its leases with its three affiliates to make them ?triple net? leases, under which the affiliate tenants will be responsible to pay directly their utilities, maintenance, insurance, and taxes with respect to the portions of the Debtor's property that they lease, those lease amendments to have appropriate rent adjustments and to take effect retroactive to May 1, 2013. Judge Drake will convene, at a later date, a hearing to determine the administrative status of the DIP financing. The Debtor is represented by Austin E. Carter, Esq. -- acarter@stoneandbaxter.com -- at Stone and Baxter LLP, in Macon, Georgia. Charter Bank is represented by Lynn Carroll, Esq. -- LCarroll@sglegal.com -- at Siegel & Golder, P.C., in Atlanta, Georgia. Cornerstone Commercial is represented by Aaron M. Kappler, Esq. -- Thompson, O'Brien, Kemp & Nasuti, P.C., in Norcross, Georgia. About Fourth Quarter Properties Fourth Quarter Properties XXXVIII, LLC, filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 13-10585) in Newnan, Georgia, on March 5, 2013. The Debtor is a single asset real estate debtor as defined in 11 U.S.C. Sec. 101(51B) and has property in 45, 47 & 59 Ansley Drive, in Newnan. The Debtor estimated at least $10 million in assets and at least $1 million in liabilities as of the Chapter 11 filing. Matthew Cathey, Esq., at Stone & Baxter, LLP, in Macon, Georgia, serves as the Debtor's counsel. According to the docket, the Chapter 11 plan and disclosure statement are due July 3, 2013. FOURTH QUARTER PROPERTIES: Employs Pardue & Company as Appraiser ---------------------------------------------------------------- Fourth Quarter Properties XXXVIII, LLC, sought and obtained authority from the U.S. Bankruptcy Court for the Northern District of Georgia, Newnan Division, to employ Pardue & Company as real estate appraiser to appraise the value of the Debtor's properties located at Newnan, Coweta County, Georgia. The Appraiser charges a $15,000 fee plus travel for the appraisal reports, with a payment of $7,500 due in advance and the balance due upon the delivery of the reports, plus an hourly charge of $35 for court appearances and depositions. About Fourth Quarter Properties Fourth Quarter Properties XXXVIII, LLC, filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 13-10585) in Newnan, Georgia, on March 5, 2013. The Debtor is a single asset real estate debtor as defined in 11 U.S.C. Sec. 101(51B) and has property in 45, 47 & 59 Ansley Drive, in Newnan. The Debtor estimated at least $10 million in assets and at least $1 million in liabilities as of the Chapter 11 filing. Matthew Cathey, Esq., at Stone & Baxter, LLP, in Macon, Georgia, serves as the Debtor's counsel. According to the docket, the Chapter 11 plan and disclosure statement are due July 3, 2013. HANDY HARDWARE: Littlejohn to Get Ownership via Plan ---------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Handy Hardware Wholesale Inc., a Houston-based buying cooperative for 1,300 retail stores, has a July 25 confirmation hearing for approval of a Chapter 11 plan allowing Littlejohn Management Holdings to acquire the business in return for a $4 million contribution. According to the report, the plan calls for paying off or rolling over working capital financing from first-lien lender Wells Fargo Bank NA. Capital One Bank USA NA, with liens on warehouses in Houston and Meridian, Mississippi, will receive title to both facilities and lease the Houston property back to the purchaser. The Mississippi warehouse was closed. Capital One is owed $25.8 million. The report relates that unsecured creditors have claims from $35 million to $56 million. For a recovery of 8 percent to 12 percent, they will receive what's left from the $4 million after paying costs of winding down the Chapter 11 case. For unsecured creditors, a significant feature the plan is the waiver of claims to sue for preferences, or payments received with 90 days of bankruptcy. The company is owned by the retailers it serves. Although the owners' equity interests will be extinguished, they will receive incentives to continue doing business. 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. Gellert Scali Busenkell & Brown, LLC represents the Committee. Wells Fargo is providing a $30 million revolving credit to finance operations in Chapter 11. In June 2013, Handy Hardware said it wants to sell itself to a unit of private equity firm Littlejohn Management Holdings LLC in a deal that would pay off all administrative claims and raise the recoveries of unsecured creditors. Under Handy Hardware's amended Chapter 11 plan, Littlejohn would also pay $4 million to cover wind-down costs for the estate and to go toward paying unsecured creditors on a pro-rated basis. HERON LAKE: Inks Management Services Agreement with EMS ------------------------------------------------------- Heron Lake BioEnergy, LLC, entered into a Limited Management Services Agreement with Energy Management Solutions, Inc., an affiliate of ICM, Inc., the licensor of certain process technology used in the Company's ethanol plant. Pursuant to the Agreement, the Company engaged EMS on a temporary basis to provide personnel to fulfill the duties of temporary general manager at the Company's ethanol plant. Pursuant to the Agreement, EMS will designate one of its employees to perform, on a full time basis, the duties of "Temporary General Manager" during the term of the Agreement. The Temporary General Manager will normally be at the Company's plant Monday through Friday. The Temporary General Manager will supervise the operational functions at the plant with respect to the production of ethanol, distillers' grain and co-products. The Temporary General Manager will also have authority and control over the management functions at the Company's plant. For its services under the Agreement, the Company will pay EMS a management fee of $175 per hour for the Temporary General Manager's working hours and $90 per hour for the Temporary General Manager's travel hours. If emergency weekend on-site coverage is required, the management fee for all associated hours (excluding travel hours) will be $225 per hour. The Company also will pay EMS for its reasonable and necessary costs and expenses at the cost incurred by the Temporary General Manager plus 15 percent. The term of the Agreement is from June 19, 2013, to Oct. 18, 2013, subject to earlier termination including by the Company for convenience upon not less than 15 days' written notice to EMS and by EMS for convenience upon not less than 30 days' written notice to the Company. About Heron Lake Heron Lake BioEnergy, LLC, operated a dry mill, coal fired ethanol plant in Heron Lake, Minnesota. After completing a conversion in November 2011, the Company is now a natural gas fired ethanol plant. Its subsidiary, HLBE Pipeline Company, LLC, owns 73 percent of Agrinatural Gas, LLC, the pipeline company formed to construct, own, and operate a natural gas pipeline that provides natural gas to the Company's ethanol production facility through a connection with the natural gas pipeline facilities of Northern Border Pipeline Company in Cottonwood County, Minnesota. Its subsidiary, Lakefield Farmers Elevator, LLC, has grain facilities at Lakefield and Wilder, Minnesota. At nameplate, the Company's ethanol plant has the capacity to process approximately 18.0 million bushels of corn each year, producing approximately 50 million gallons per year of fuel-grade ethanol and approximately 160,000 tons of distillers' grains with soluble. In its report on the Company's financial statements for the fiscal year ended Oct. 31, 2012, Boulay, Heutmaker, Zibell & Co. P.L.L.P., in Minneapolis, Minnesota, expressed substantial doubt about Heron Lake BioEnergy's ability to continue as a going concern. The independent auditors noted that the Company has incurred losses due to difficult market conditions and the impairment of long-lived assets. "The Company is out of compliance with its master loan agreement and is operating under a forbearance agreement whereby the Company agreed to sell substantially all of its assets." The Company reported a net loss of $32.35 million for the year ended Oct. 31, 2012, as compared with net income of $543,017 for the year ended Oct. 31, 2011. Bankruptcy Warning At Jan. 31, 2013, the Company's total indebtedness to AgStar was approximately $41.1 million. All of the Company's assets and real property are subject to security interests and mortgages in favor of AgStar as security for the obligations of the master loan agreement. The Company's failure to pay any required installment of principal or interest or any other amounts payable under the Company's Term Loan or Term Revolving Loan or the Company's failure to perform or observe any covenant under the Sixth Amended and Restated Master Loan Agreement would result in an event of default, entitling AgStar to accelerate and declare due all amounts outstanding under the Company's Term Loan and its Term Revolving Loan. "Upon the occurrence of any one or more Events of Default, as defined under the Sixth Amended and Restated Forbearance Agreement, including failure to observe any of the financial or affirmative covenants..., AgStar may accelerate all of our indebtedness and may seize the assets that secure our indebtedness, causing us to lose control of our business. We may also be forced to sell our assets, restructure our indebtedness, submit to foreclosure proceedings, cease operations or seek bankruptcy or reorganization protection." IMAGEWARE SYSTEMS: Bruce Toll Held 6.7% Equity Stake at June 18 --------------------------------------------------------------- In an amended Schedule 13D filing with the U.S. Securities and Exchange Commission, Bruce Toll and his affiliates disclosed that, as of June 18, 2013, they beneficially owned 5,424,606 shares of common stock of ImageWare Systems, Inc., representing 6.72 percent of the shares outstanding. The reporting persons previously disclosed beneficial ownership of 7,047,434 common shares or 9.65 percent equity stake as of June 20, 2011. A copy of the amended regulatory filing is available at http://is.gd/k54mDr About ImageWare Systems Headquartered in San Diego, California, ImageWare Systems, Inc., is a leader in the emerging market for software-based identity management solutions, providing biometric, secure credential, law enforcement and enterprise authorization. Its "flagship" product is the IWS Biometric Engine. Scalable for small city business or worldwide deployment, the Company's biometric engine is a multi- biometric platform that is hardware and algorithm independent, enabling the enrollment and management of unlimited population sizes. The Company's identification products are used to manage and issue secure credentials, including national IDs, passports, driver licenses, smart cards and access control credentials. Its law enforcement products provide law enforcement with integrated mug shot, fingerprint LiveScan and investigative capabilities. The Company also provides comprehensive authentication security software. Imageware Systems incurred a net loss of $10.19 million in 2012, as compared with a net loss of $3.18 million in 2011. The Company's balance sheet at March 31, 2013, showed $7.61 million in total assets, $6.68 million in total liabilities and $927,000 in total shareholders' equity. IZEA INC: Obtains $170,000 Financing From Director -------------------------------------------------- IZEA, Inc., entered into unsecured loan agreements with Brian W. Brady, a director of the Company. Pursuant to these agreements, the Company received short term loans of $120,000 and $50,000 on June 7 and June 14, 2013, respectively, both of which are due on Aug. 31, 2013. The notes bear interest at 7 percent per annum with a default rate of interest at 12 percent based on a 360 day year. About IZEA, Inc. IZEA, Inc., headquartered in Orlando, Fla., believes it is a world leader in social media sponsorships ("SMS"), a rapidly growing segment within social media where a company compensates a social media publisher to share sponsored content within their social network. The Company accomplishes this by operating multiple marketplaces that include its platforms SocialSpark, SponsoredTweets and WeReward, as well as its legacy platforms PayPerPost and InPostLinks. The Company has incurred significant losses from operations since inception and has an accumulated deficit of $20.9 million as of June 30, 2012. The Company's balance sheet at March 31, 2013, showed $1.01 million in total assets, $2.96 million in total liabilities and a $1.94 million total stockholders' deficit. Cross, Fernandez & Riley, LLP, in Orlando, Florida, expressed substantial doubt about IZEA's ability to continue as a going concern, following the Company's results for the fiscal year ended Dec. 31, 2011. The independent auditors noted that the Company has incurred recurring operating losses and had an accumulated deficit at Dec. 31, 2011, of $18.1 million. JEH COMPANY: Hearing Today on Use of Frost Bank's Cash Collateral ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Texas will convene a hearing today June 25, 2013, at 10:30 a.m., to consider an agreed order authorizing, on an interim basis, JEH Company's use of cash collateral. On June 10, the Court approved an agreed order granting the continued use of cash collateral which Frost Bank asserts an interest. As reported in the Troubled Company Reporter on June 7, 2013, JEHCO has identified Frost Bank as lender asserting liens against assets that constitute cash collateral. Frost Bank is owed $3.5 million in principal under a loan to JEHCO and $2.55 million in principal under a loan to debtor JEH Stallion Station, Inc., and non-debtor JEH Pipeline Co. Inc. JEHCO says that interim use of cash collateral will be limited to only those expenses that are actual and necessary in connection with the continued operation of the business. The Debtor is seeking to pay, among other things, prepetition obligations totaling $175,000 to employees. No employee would receive in excess of $11,725. "If operations are ceased, the value of the property against which the liens of the secured creditor attach, may decline. If operations are ceased, the opportunity of the Debtor to generate adequate income to repay outstanding obligations may be inadequate. The Debtor believes that with appropriate restructuring and debt repayment that is consistent with the cash flow of the Debtor, the operations of the Debtor can be profitable," avers Mark J. Petrocchi, Esq., at Griffith, Jay & Michel, LLP, counsel for the Debtor. The Debtor states that it will offer "fair protection" to the secured creditor, included but not limited to providing regular reporting consistent with the reporting provided to the United States Trustee, reasonable additional reporting generally prepared by the Debtor or which may be prepared by the Debtor without undue burden, and a replacement lien to protect against the diminution of the value of the estate of the Debtor. About JEH Company JEH Company, JEH Stallion Station, Inc., and JEH Leasing Company, Inc. filed bare-bones Chapter 11 petitions (Bankr. N.D. Tex. Case Nos. 13-42397 to 13-42399) in Ft. Worth, Texas on May 22, 2013. JEH Company estimated at least $10 million in assets and liabilities. Mark Joseph Petrocchi, Esq., at Griffith, Jay & Michel, LLP, in Ft. Worth, serves as counsel to the Debtors. JEH Company was organized in 1982 by Jim and Marilyn Helzer. According to http://www.jehroofingcompany.com/JEHCO buys roofing material directly from the manufacturer and sell it to contractors, builders, and homeowners. JEH Leasing owns and leases equipment and vehicles primarily for use in the business of JEHCO. Stallion is in the quarter horse and thoroughbred horse business. JERRY'S NUGGET: Asks Court to Extend Plan Solicitation Deadline --------------------------------------------------------------- Jerry's Nugget, Inc., and Spartan Gaming LLC, earlier this month asked the U.S. Bankruptcy Court for the District of Nevada to: i) enter an initial order extending the exclusive period to secure acceptance of the Debtors' Plan through June 26, 2013, which is the hearing date for approval of the Debtors' Disclosure Statement, and U.S. Bank's motion to terminate exclusivity; and ii) enter a second order extending the exclusivity period for the Debtors to obtain confirmation of the pending Plan through the confirmation hearing date that will be determined in conjunction with the June 26 hearing on the approval of the Disclosure Statement. According to the Debtors, exclusivity is warranted to allow the Debtors to complete their confirmation hearing without incurring the significant expense of addressing a completing plan filed by a lender that is over-secured by more than $4 million and has no risk of nonpayment, which lender plan will certainly seek to divest the Debtors of their family-owned casino that they have owned and operated since 1964. The Plan As reported in the Troubled Company Reporter on June 13, 2013, the Court will convene a hearing on June 26, at 9:30 a.m., to consider the adequacy of the Disclosure Statement explaining the Plan of Reorganization proposed by Jerry's Nugget and Spartan Gaming. According to the Disclosure Statement, the Debtors' Plan generally provides for the repayment of claims against the Debtors as: (i) Allowed Secured Claims will be paid in full with interest; (ii) Allowed Priority Claims will be paid in full with interests; (iii) Allowed Administrative Convenience Claims will be paid in full; and (iv) Allowed General Unsecured Claims will be paid their Pro Rata portion of $2,500,000, which will be funded by Debtors' ongoing operations and the $400,000 or greater contribution from the Stamis Trusts. Existing Equity Securities in JNI and Spartan Gaming will be canceled and 100 percent of the Reorganized Debtors' stock and membership issued to the Stamis Trusts. On the substantial consummation date, the Stamis Trusts will contribute $400,000, which money will be used by Reorganized Debtors to fund the distributions required under the Plan. Upon the written request of Reorganized Debtors after the substantial consummation date, the Stamis Trusts will additionally contribute others funds as are necessary for Reorganized Debtors to timely tender the distributions contemplated by the Plan. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/JERRYS_NUGGET_ds.pdf The Bankruptcy Court also will convene a hearing on June 26 at 9:30 a.m., to consider creditor U.S. Bank National Association's motion to limit the Debtors' exclusivity period. U.S. Bank wants the Court terminate the Debtors' exclusive periods. The bank said in Court papers filed last month that it would be impossible for the Debtors to obtain acceptance of a plan prior to the June 10 expiration of their exclusivity period. U.S. Bank also stated that the Debtors have been dilatory in seeking plan confirmation and the Debtors are mismanaged. U.S. Bank stressed that terminating the Debtors' exclusivity period will not prevent the Debtors from seeking confirmation of their own plan. About Jerry's Nugget and Spartan Gaming Jerry's Nugget Inc., operates Jerry's Nugget, a casino consisting of approximately 87,187 square feet of building area and 24,511 square fee of casino floor space with approximately 630 slot and video poker machines and 9 table games. Jerry's Nugget also contains a sports book, a keno area and a small live pit. Jerry's Nugget Inc. and affiliate Spartan Gaming LLC sought Chapter 11 protection (Bankr. D. Nev. Lead Case No. 12-19387) in Las Vegas, Vegas, on Aug. 13, 2012. Jerry's Nugget, owned by the Stamis family, has a 9.1-acre casino property in North Las Vegas. The property consists of 87,187 square feet of building area and 24,511 square feet of casino floor space, with 630 slot and video poker machines and 9 table games. Jerry's Nugget also contains a sports book, a keno area, and a small live pit. There are two restaurants the Uncle Angelo's Pizza Joint and Jerry's Famous Coffee shop as well as Uncle Angelo's Bakery, a locals' favorite. Net revenues totaled $22.5 million, including $15.3 million in gaming revenue, in the year ended Dec. 31, 2011. Spartan Gaming owns 12 parcels of real property in Nevada. Two of the parcels provide parking access for Jerry's Nugget. Judge Mike K. Nakagawa presides over the case. Gerald M. Gordon, Esq., at Gordon Silver represent the Debtors. Jerry's Nugget estimated assets and debts of $10 million to $50 million. Jerry's Nugget said its current going concern value is at least $8 million. Spartan Gaming estimated $1 million to $10 million in assets and debts. The petitions were signed by Jeremy Stamis, president. In its schedules, Jerry's Nugget disclosed $12,378,944 in assets and $10,771,442 in liabilities as of the Petition Date. JM SMUCKER: False Ad Plaintiff Can Recover Fees, Judge Rules ------------------------------------------------------------ Matthew Heller of BankruptcyLaw360 reported that a California federal judge ruled that the lead plaintiff in a false advertising class action against The J.M. Smucker Co. is entitled to an award of millions of dollars in attorneys' fees even though she was removed from the case after filing bankruptcy. According to the report, U.S. District Judge George H. King agreed with Mary Henderson that she had standing to claim attorneys' fees as the "successful" or "prevailing" party in the lawsuit, which alleged Smucker falsely marketed products full of hydrogenated oils as healthy. The case is Mary Henderson v. The J. M. Smucker Company, Case No. 2:10-cv-04524 (GHK)(C.D. Calif.). J. M. Smucker Co. is a multi-billion dollar North American food corporation based in Orrville, Ohio. It manufactures, markets, and sells cooking oils nationwide from its manufacturing plant in Orrville, Ohio, including Crisco Natural Blend Oil, Crisco Pure Corn Oil, Crisco Pure Canola Oil, and Crisco Pure Vegetable Oil. K-V PHARMACEUTICAL: Exclusivity Tolled Over DIP Lenders' Objection ------------------------------------------------------------------ Judge Allan Gropper of the U.S. Bankruptcy Court for the Southern District of New York extended K-V Pharmaceutical Company and its debtor affiliates' exclusivity periods over the objection raised by lenders providing bankruptcy financing and the prepetition noteholders. Silver Point Finance, LLC, Whitebox Advisors, LLC, and Pioneer Investment Management, Inc., as DIP Agent and DIP Lenders and members of the Ad Hoc Group, complain that the Debtors rejected the reorganization plan they proposed in favor of a plan that is economically less favorable to the Debtors' creditors and estates. The Noteholders also object to the Debtors' request for approval of a revised replacement DIP credit agreement, asserting that the Debtors will receive no benefit if they consummate the refinancing, but instead will put in place a refinancing facility that is unnecessary and clearly inferior to the DIP Facility while depriving their creditors of the amount of the total fees and expenses of at least four additional law firms and potentially additional advisors. "Instead of pursuing this economically superior plan, the Debtors seek authority to irreversibly chain themselves to an inferior plan. . . The Debtors continue to demonstrate that they do not have the best interest of their creditors in mind," the Noteholders argued. The Debtors have until Aug. 16, 2013, to file a plan of reorganization and until Sept. 16 to solicit acceptances of that plan. Lori R. Fife, Esq., and Robert J. Lemons, Esq., at Weil, Gotshal & Manges LLP, in New York, for the DIP Agent, DIP Lenders, and the Ad Hoc Group. About K-V Pharmaceutical K-V Pharmaceutical Company (NYSE: KVa/KVb) -- http://www.kvpharmaceutical.com/-- is a fully integrated specialty pharmaceutical company that develops, manufactures, markets, and acquires technology-distinguished branded and generic/non-branded prescription pharmaceutical products. The Company markets its technology distinguished products through ETHEX Corporation, a subsidiary that competes with branded products, and Ther-Rx Corporation, the company's branded drug subsidiary. K-V Pharmaceutical Company and certain domestic subsidiaries on Aug. 4, 2012, filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-13346, under K-V Discovery Solutions Inc.) to restructure their financial obligations. K-V employed Willkie Farr & Gallagher LLP as bankruptcy counsel, Williams & Connolly LLP as special litigation counsel, and SNR Denton as special litigation counsel. In addition, K-V tapped Jefferies & Co., Inc., as financial advisor and investment banker. Epiq Bankruptcy Solutions LLC is the claims and notice agent. The U.S. Trustee appointed five members to serve in the Official Committee of Unsecured Creditors. Kristopher M. Hansen, Esq., Erez E. Gilad, Esq., and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, represent the Creditors Committee. Weil, Gotshal & Manges LLP's Robert J. Lemons, Esq., and Lori R. Fife, Esq., represent an Ad Hoc Senior Noteholders Group. K-V PHARMACEUTICAL: Settlement with Texas and Ven-A-Care Approved ----------------------------------------------------------------- BankruptcyData reported that the U.S. Bankruptcy Court approved K- V Pharmaceutical's settlement agreement with the State of Texas and Ven-A-Care of the Florida Keys. As previously reported," Under this agreement, Claim No. 300 will be deemed allowed as a general unsecured claim against K-V Pharmaceutical in the fixed, liquidated amount of $3,000,000 and the State of Texas shall be paid a pro rata distribution on account of the allowed Texas claim in accordance with any confirmed Chapter 11 plan. Simultaneously, the Texas action and the Company stay enforcement motion will be withdrawn." About K-V Pharmaceutical K-V Pharmaceutical Company (NYSE: KVa/KVb) -- http://www.kvpharmaceutical.com/-- is a fully integrated specialty pharmaceutical company that develops, manufactures, markets, and acquires technology-distinguished branded and generic/non-branded prescription pharmaceutical products. The Company markets its technology distinguished products through ETHEX Corporation, a subsidiary that competes with branded products, and Ther-Rx Corporation, the company's branded drug subsidiary. K-V Pharmaceutical Company and certain domestic subsidiaries on Aug. 4, 2012, filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 12-13346, under K-V Discovery Solutions Inc.) to restructure their financial obligations. K-V employed Willkie Farr & Gallagher LLP as bankruptcy counsel, Williams & Connolly LLP as special litigation counsel, and SNR Denton as special litigation counsel. In addition, K-V tapped Jefferies & Co., Inc., as financial advisor and investment banker. Epiq Bankruptcy Solutions LLC is the claims and notice agent. The U.S. Trustee appointed five members to serve in the Official Committee of Unsecured Creditors. Kristopher M. Hansen, Esq., Erez E. Gilad, Esq., and Matthew G. Garofalo, Esq., at Stroock & Stroock & Lavan LLP, represent the Creditors Committee. Weil, Gotshal & Manges LLP's Robert J. Lemons, Esq., and Lori R. Fife, Esq., represent an Ad Hoc Senior Noteholders Group. LEE BRICK: Has Until June 28 to Solicit Plan Votes -------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of North Carolina extended Lee Brick & Tile Company's exclusive periods to solicit acceptances for the proposed Amended and Restated Plan of Reorganization until June 28, 2013. The Court conditionally approved the Amended Disclosure Statement on April 24. As reported in the Troubled Company Reporter on March 26, 2013, the Debtor's Plan of Reorganization groups claims into 11 classes of creditors. The first three classes relate to costs of administration and priority claims under the Bankruptcy Code, and the treatment of each is governed by specific provisions of the Bankruptcy Code. Classes 4 through 8 relate to classes that are treated as secured creditor classes. Class 9 relates to the Unsecured Deficiency Claim of Capital Bank. Class 10 relates to allowed unsecured creditor claims while Class 11 relates to Shareholder Interests. Payments provided under the terms of the Plan will be made from those monies remaining after satisfaction of Class 1, Class 2, and Class 3, and after debt service payments as otherwise provided in the Plan, and after payment of normal operating expenses and retention of sufficient operating reserve of the Reorganized Debtor, derived from the following sources: (i) the Debtor's Cash on Hand at Effective Date; (ii) net sale proceeds from any other Retained Assets designated for sale as provided in the terms of the Plan; (iii) revenues from the business operations of the Reorganized Debtor; (iv) net proceeds from the Debtor's collection of accounts receivable and tax refunds, if any; (v) net proceeds from recoveries of Designated Litigation, if any, and (vi) voluntary capital contributions from shareholders or loans from a shareholder(s) made on a basis subordinate to the interests of Class 4, 5, 6, 7, 8, 9, and 10 allowed claims. Capital Bank, N.A., formerly known as NAFH National Bank, successor by merger with Capital Bank, has filed an Objection to the Plan, which separately classifies Capital Bank's claim into secured and unsecured portions. The Plan proposes to allow Capital Bank a Class 4 Secured Claim in the amount of $8,500,000 and a Class 9 Unsecured Deficiency Claim in the amount of $4,895,490.39. Each class sets forth alternative repayment proposals for the Secured Claim and the Unsecured Claim. Capital Bank objects to treatment of its claim for the following reasons: (1) The Plan improperly prefers equity holders. (2) The Plan is not feasible. (3) The Plan does not provide Capital Bank with as much as Capital Bank would receive under a liquidation. (4) The Plan improperly classifies the Unsecured Claim. (5) The Plan is not fair and equitable to Capital Bank. (6) The Plan has not been proposed in good faith. About Lee Brick Sanford, North Carolina-based Lee Brick & Tile Company filed a bare-bones Chapter 11 petition (Bankr. E.D.N.C. Case No. 12-04463) on June 15, 2012, in Wilson on June 15, 2012. Lee Brick -- http://www.leebrick.com/-- began its operations in 1951 after Hugh Perry and 10 local businessmen from Lee County decided three years prior to invest in the business of brickmaking. In the late 1950's Hugh Perry bought out the investing partners, making Lee Brick a solely owned and operated family company. Hugh Perry named his son Frank president in 1970, which he served until 1999 and currently serves as CEO. Since 1999 Don Perry succeeded his father and serves as the company's president. Frank Perry, along with his sons Don and Gil, and brother-in-law JR (rad) Holton have helped guide the family business through revolutionary changes in brick manufacturing that few people in the ceramic industry could have ever anticipated. Judge Randy D. Doub presides over the case. Kevin L. Sink, Esq., at Nicholls & Crampton, P.A., serves as the Debtor's counsel. The petition was signed by Don W. Perry, president. The Debtor, in its amended schedules, disclosed $27,851,968 in assets and $14,136,003 in liabilities as of the Chapter 11 filing. In the original schedules, the Debtor scheduled $27,851,968 in assets and $14,135,140 in liabilities. Lender Capital Bank is owed $13.0 million, of which $6.5 million is secured. LEHMAN BROTHERS: Brokerage Lawyers Awarded $62 Million ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that James Giddens, the trustee liquidating the brokerage subsidiary of Lehman Brothers Holdings Inc., was awarded about $62 million for services he performed along with his firm Hughes Hubbard & Reed LLP for a year ended in February. The report notes that Mr. Giddens and the firm can't spend it all because about $6.2 million was held back for final payment later in the case. In addition, Giddens and Hughes Hubbard voluntary reduced their fees 10 percent in agreement with the Securities Investor Protection Corp. when the liquidation began in 2008. SIPC provides funds to pay costs of the liquidation. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. The Chapter 11 plan for the Lehman companies other than the broker was confirmed in December 2011. Lehman made its first payment of $22.5 billion to creditors in April 2012, a second payment of $10.2 billion on Oct. 1, 2012, and a third payment of $14.2 billion on April 4, 2013. The brokerage is yet to make a first distribution to non-customers. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. LOGAN'S ROADHOUSE: Moody's Lowers CFR & Notes Rating to 'Caa2' -------------------------------------------------------------- Moody's Investors Service downgraded Logan's Roadhouse Inc.'s Corporate Family Rating to Caa2 from B3 and Probability of Default Rating to Caa2-PD from B3-PD. Concurrently, Moody's lowered the rating on the $355 million senior secured second lien notes to Caa2 from B3. The ratings outlook is stable. The downgrade of the Corporate Family Rating to Caa2 reflects very high leverage, weak same store sales and customer traffic, and concerns about the sustainability of the capital structure over the intermediate term. Moody's expects the company's financial performance to remain under pressure over the intermediate term given headwinds that include soft consumer discretionary spending in the company's primary markets, volatile beef costs, and the intense competitive environment among casual dining concepts. The following rating actions were taken: Corporate Family Rating, downgraded to Caa2 from B3; Probability of Default Rating, downgraded to Caa2-PD from B3-PD; $355 million senior secured second lien notes, due 2017, downgraded to Caa2 (LGD 4, 50%) from B3 (LGD3, 49%). Ratings Rationale: Logan's Caa2 Corporate Family Rating reflects the company's weak liquidity profile, EBITA to interest expense of below 1 times and projected debt leverage of above 8.0 times (Moody's adjusted) over the next 12-18 months. Moreover, the rating reflects limited financial flexibility stemming from Logan's debt service burden that is expected to consume a substantial portion of available cash. Moody's projections assume that EBITDA generation continues to modestly deteriorate owing to continued soft guest traffic trends, and increasing commodity and labor costs. Moody's is also concerned about the company's inability to close underperforming restaurants and cut losses swiftly as the process is cumbersome due to the heavy influence of leases that govern many of its properties. Logan is not expected to offset the negative pressures with pricing increases given the intensely competitive nature of the casual restaurant industry and highly price sensitive consumer. The rating is supported by the company's established niche as a roadhouse-themed steakhouse chain focusing on value offerings and new management's initiatives that focus on improving profitability and growth. The stable outlook reflects Moody's expectation for modest EBITDA deterioration and for debt leverage to remain above 8 times over the next 12 months. The ratings could be downgraded if Logan's liquidity materially weakens for any reason. Additionally, continued negative trends in operating metrics, particularly in guest traffic, could place pressure on the ratings. The ratings could be upgraded if the company's liquidity profile improves significantly. Additionally, positive ratings pressure could develop if Logan's is able to improve same-store sales and guest traffic at its existing restaurants on a sustainable basis such that EBITA/interest expense is sustained above 1 times and debt/EBITDA is sustained below 7.0x. The principal methodology used in this rating was the Global Restaurant Methodology published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non- Financial Companies in the U.S., Canada and EMEA published in June 2009. Logan's Roadhouse, Inc. headquartered in Nashville, Tennessee, owns and operates 232 and franchises 26 traditional American roadhouse-style steakhouses in 23 states across the country as of April 28, 2013. Company-owned units are largely concentrated in the south and southeastern United States with franchise locations in California and the Carolinas. Revenues for the last twelve months ended April 28, 2013 were $648 million. LPATH INC: Stockholders Elect Six Directors ------------------------------------------- LPath Inc. held its annual meeting of stockholders on June 19, 2013, at which the stockholders: (1) elected Daniel H. Petree, Scott R. Pancoast, Jeffrey A. Ferrell, Daniel L. Kisner, Charles A. Mathews and Donald R. Swortwood as directors, each to a one-year term; (2) ratified the appointment of Moss Adams, LLP, as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2013; (3) approved, on a non-binding advisory basis, the compensation of the Company's named executive officers; (4) indicated "1 Year" as the preferred frequency of the advisory vote on executive compensation; (5) ratified an amendment to the Company's Articles of Incorporation to increase the authorized common stock from 28,571,429 shares to 100,000,000 shares; and (6) approved an amendment and to the Company's Amended and Restated 2005 Equity Incentive Plan to increase the number of shares of Common Stock issuable under the Plan by 1,015,635 shares. In light of the results of the stockholder vote on the frequency of future non-binding advisory votes on the compensation of the Company's named executive officers, and consistent with the Company's recommendation, the Company's Board of Directors has determined that the Company will hold a non-binding advisory vote on executive compensation annually until the next required vote on the frequency of future non-binding advisory votes on the compensation of the Company's named executive officers. Effective on June 19, 2013, Lpath filed a Certificate of Amendment to Articles of Incorporation to increase the authorized Common Stock from 28,571,429 shares to 100,000,000 shares. About Lpath, Inc. San Diego, Calif.-based Lpath, Inc. is a biotechnology company focused on the discovery and development of lipidomic-based therapeutics, an emerging field of medical science whereby bioactive lipids are targeted to treat human diseases. Lpath disclosed a net loss of $2.75 million in 2012, as compared with a net loss of $3.11 million in 2011. The Company's balance sheet at March 31, 2013, showed $23.04 million in total assets, $9.17 million in total liabilities and $13.87 million in total stockholders' equity. MAIN STREET: No Bids Competing With Insiders to Buy Daily Voice --------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Daily Voice received no competing bids to buy news Web sites for 41 communities in Westchester County, New York, and Fairfield County, Connecticut. According to the report, the company was slated to appear in bankruptcy court June 24 in White Plains, New York, aiming to obtain authorization for the founder and two shareholders to buy the business for $800,000. Founder Carll Tucker and two shareholders are the prospective buyers. They are offering $100,000 cash while taking ownership in exchange for $550,000 in pre-bankruptcy secured debt and $150,000 in financing for the Chapter 11 effort. About Main Street Main Street Connect LLC, the owner of the Daily Voice news website for 41 communities in Westchester County, New York, and Fairfield County, Connecticut, filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 13-22729). The business disclosed assets of $395,000 and liabilities totaling $877,000, including $550,000 in secured debt. Daily Voice was facing a lawsuit by workers alleging violation of the federal Fair Labor Standards Act. The lawsuit, which is pending, had cost $500,000 in fees and precluded raising more financing. MASTRO'S RESTAURANTS: S&P Raises CCR to 'B'; Outlook Stable ----------------------------------------------------------- Standard & Poor's Ratings Services said it raised its corporate credit rating on Woodland Hills, Calif.-based Mastro's Restaurants LLC to 'B' from 'B-'. The outlook is stable. At the same time, S&P withdrew its 'B-' issue-level and '4' recovery rating on the company's $102 million senior secured notes. Subsequently, S&P withdrew the corporate credit rating on the company. The rating action reflects Mastro's improved credit profile following its recent acquisition by Landry's Inc. and the completed exchange of approximately $102 million of Mastro's notes for about $111.6 million of Landry's notes. Once integrated, S&P believes Mastro's will benefit from Landry's operational synergies and its capital resources. MCCLATCHY COMPANY: Amends 2012 Annual Report -------------------------------------------- The McClatchy Company has amended its annual report on Form 10-K for the year ended Dec. 30, 2012, that was originally filed with the Securities and Exchange Commission on March 6, 2013, to present circulation revenues associated with the Company's "fee for service" contracts with distributors and carriers on a gross basis, as opposed to on a net basis as previously presented in the Form 10-K, and to correct an administrative error in the disclosure of the date associated with the Company's first fiscal quarter in 2013. The difference in presentation results in delivery costs associated with these contracts being reported as other operating expenses, rather than as a reduction in circulation revenues, in the Company's consolidated statements of operations. The Company believes this correction is not material to its previously issued financial statements for prior periods. There is no impact to the previously reported operating income, net income (loss) or net income (loss) per common share in any of the periods presented. A copy of the amended Form 10-K is available for free at: http://is.gd/aYtamg About The McClatchy Company Sacramento, Cal.-based The McClatchy Company (NYSE: MNI) -- http://www.mcclatchy.com/-- is the third largest newspaper company in the United States, publishing 30 daily newspapers, 43 non-dailies, and direct marketing and direct mail operations. McClatchy also operates leading local Web sites in each of its markets which extend its audience reach. The Web sites offer users comprehensive news and information, advertising, e-commerce and other services. Together with its newspapers and direct marketing products, these interactive operations make McClatchy the leading local media company in each of its premium high growth markets. McClatchy-owned newspapers include The Miami Herald, The Sacramento Bee, the Fort Worth Star-Telegram, The Kansas City Star, The Charlotte Observer, and The News & Observer (Raleigh). The McClatchy incurred a net loss of $144,000 in 2012, as compared with net income of $54.38 million in 2011. The Company's balance sheet at March 31, 2013, showed $2.84 billion in total assets, $2.81 billion in total liabilities, and $32.83 million in stockholders' equity. * * * McClatchy carries a 'Caa1' corporate family rating from Moody's Investors Service. In May 2011, Moody's changed the rating outlook from stable to positive following the company's announcement that it closed on the sale of land in Miami for $236 million. The outlook change reflects Moody's expectation that McClatchy will utilize the net proceeds to reduce debt, including its underfunded pension position, which will reduce leverage by approximately half a turn and lower required contributions to the pension plan over the next few years. McClatchy Co. carries a 'B-' Corporate Credit Rating from Standard & Poor's Ratings Services. MERIDIAN SUNRISE: Wants Cash Access Until Plan Effective Date ------------------------------------------------------------- Meridian Sunrise Village, LLC, asks the U.S. Bankruptcy Court for the Western District of Washington to extend the Debtor's authority to use cash collateral until Aug. 31, 2013. According to the Debtor, the last day the Debtor may use cash collateral is the earlier of (i) the effective date of a confirmed plan of reorganization, or (ii) July 1. In this relation, the Debtor requests further authority to use cash collateral through the earliest of (i) the effective date of a confirmed of a plan of reorganization; (ii) entry of a subsequent order of the Court following notice and hearing that terminates the Debtor's authority to use cash collateral, or (iii) Aug. 31. The Debtor also proposes to effectuate the extension pursuant to an order substantially in the form of the final cash collateral order. On April 26, the Court entered its order approving First Amended Disclosure Statement. The Court held an initial hearing on the Plan on May 29, and has set an evidentiary hearing on confirmation of the Plan to begin on June 27. A June 26 hearing at 9 a.m. has been set. About Meridian Sunrise Village LLC Meridian Sunrise Village LLC filed a Chapter 11 petition (Bankr. W.D. Wash. Case No. 13-40342) in Tacoma, Washington, on Jan. 18, 2013. The Debtor, a single asset real estate under 11 U.S.C. Sec. 101(51B), disclosed $70.6 million in total assets and $65.9 million in total liabilities in its schedules. James L. Day, Esq., at Bush Strout & Kornfeld LLP represents the Debtor. The Debtor owns the property known as the New Meridian Sunrise Village in 10507 156th St. E. Puyallup, Washington. The Debtor has valued the property at $70 million, which property secures debt of $64.4 million to U.S. Bank, National Association. A copy of the schedules attached to the petition is available at http://bankrupt.com/misc/wawb13-40342.pdf Alan D. Smith -- ADSmith@perkinscoie.com -- and Brian A. Jennings, WSBA -- BJennings@perkinscoie.com -- at Perkins Coie, LLP represent U.S. Bank National Association, as administrative agent. James L. Day at Bush Strout & Kornfeld LLP represents the Debtor in its restructuring effort. MESA ACQUISITION: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Mesa Acquisition Corp. 10 Commerce Park N., Suite 6 Bedford, NH 03110 Bankruptcy Case No.: 13-11578 Chapter 11 Petition Date: June 19, 2013 Court: U.S. Bankruptcy Court District of New Hampshire (Manchester) Judge: J. Michael Deasy Debtor's Counsel: Robert J. Keach, Esq. BERSTEIN, SHUR, SAWYER & NELSON 100 Middle Street, PO Box 9729 Portland, ME 04104-5029 Tel: (207) 774-1200 Fax: (207) 774-1127 E-mail: rkeach@bernsteinshur.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $0 to $50,000 The Company's list of its largest unsecured creditors filed with the petition does not contain any entry. The petition was signed by Jessica Giguere-Dionne, director of finance. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Mesa International Corp. 13-11554 06/17/13 MONARCH COMMUNITY: Gets Preliminary Approval of Recapitalization ---------------------------------------------------------------- Monarch Community Bancorp, Inc., the parent company of Monarch Community Bank, has received written, preliminary approval from the United States Department of Treasury to retire Monarch's Capital Purchase Program preferred stock for 45 percent of the $6.785 million principal balance (approximately $3,053,250) plus 100 percent of the accrued and unpaid dividends thereon (approximately $1,440,858 as of Sept. 30, 2013), subject to certain conditions, including the completion of Monarch's previously announced $16.5 million private placement common stock offering. On May 7, 2013, the Company announced that it had engaged two well respected investment banking firms to co-lead the equity offering. On June 10, 2013, Monarch announced that its Board of Directors set the offering price at $2.00 per share. The approval by Treasury of Monarch's proposed CPP preferred stock retirement is preliminary in nature and is subject to the negotiation and execution of a definitive Securities Purchase Agreement between Monarch and Treasury. The offering is also contingent upon regulatory approvals and other conditions. About Monarch Community Coldwater, Michigan-based Monarch Community Bancorp, Inc., was incorporated in March 2002 under Maryland law to hold all of the common stock of Monarch Community Bank, formerly known as Branch County Federal Savings and Loan Association. The Bank converted to a stock savings institution effective Aug. 29, 2002. In connection with the conversion, the Company sold 2,314,375 shares of its common stock in a subscription offering. Plante & Moran, PLLC, in Auburn Hills, Michigan, expressed substantial doubt about Monarch Community's ability to continue as a going concern. The independent auditors noted that the Corporation has suffered recurring losses from operations and as of Dec. 31, 2011, did not meet the minimum capital requirements as established by the regulators. The Corporation reported a net loss of $353,000 on $6.8 million of net interest income (before provision for loan losses) in 2011, compared with a net loss of $10.9 million on $7.5 million of net interest income (before provision for loan losses) in 2010. Total non-interest income was $4.0 million for 2011, compared with $3.7 million for 2010. The Company's balance sheet at Dec. 31, 2011, showed $208.1 million in total assets, $197.0 million in total liabilities, and stockholders' equity of $11.1 million. MOORE FREIGHT: Reaches Adequate Protection Terms with Creditors --------------------------------------------------------------- Judge Keith M. Lundin of the U.S. Bankruptcy Court for the Middle District of Tennessee, Nashville Division, signed off two orders approving agreements entered into by Moore Freight Service, Inc., with two of its secured lenders, which provide for the terms of the adequate protection for the Debtor's use of the collateral securing its prepetition indebtedness. The first order provides that SG Equipment Finance USA Corp. will have an allowed fully secured claim in the amount of $369,088, plus interest, fees and costs. As adequate protection for the use of the Double Drop Trailers, the Debtor will make monthly payments in the amount of $8,750 to SGEF from February to June 2013 and $5,000 beginning in July 2013 through the date of the confirmation of a plan of reorganization. At all times that the Double Drop Trailers are in the Debtor's use and possession, they must continue to be fully insured and used for their intended purpose. SGEF has also agreed to forbear the prosecution of a pending lawsuit against Dan Moore until Aug. 1, 2013, or the confirmation of a plan of reorganization, whichever date comes first. The second order provides that to provide Capital One Equipment Leasing & Finance with adequate protection of its interest in the Collateral, the Debtor will make monthly payments to Capital One in the total amount of $4,200 per month, commencing with a payment due on April 28, 2013, and on each subsequent month until the commencement of payments on Capital One's secured claim as part of the Debtor's Plan of Reorganization. Roy C. DeSha, Esq. -- roy@deshalaw.com -- at Desha Watson PLLC, in Nashville, Tennessee, and Michael Tsang, Esq. -- mtsang@tsanglawfirm.com -- at The Tsang Law Firm, P.C., in New York, represent SGEF. Michael G. Abelow, Esq., at Sherrard & Roe, PLC, in Nashville, Tennessee, represent Capital One. David P. Canas, Esq., Barbara D. Holmes, Esq., and Tracy M. Lujan, Esq., at Harwell Howard Hyne Gabbert & Manner, P.C., in Nashville, Tennessee, represent the Debtor. About Moore Freight Service and G.R.E.A.T. Logistics Moore Freight Service, Inc. and G.R.E.A.T. Logistics Inc. sought Chapter 11 protection (Bankr. M.D. Tenn. Case Nos. 12-08921 and 12-08923) in Nashville on Sept. 28, 2012. Moore Freight is a freight service company specializing in flat gas transportation. Founded in 2001, Moore is the largest commercial flat glass logistics firm in the U.S. It operates in the U.S., Canada and Mexico. GLI does not have any operations other than the limited, occasional freight brokerage services currently provided to Moore Freight. Bankruptcy Judge Keith M. Lundin oversees the cases. Attorneys at Harwell Howard Hyne Gabbert & Manner PC serve as counsel. LTC Advisory Services LLC serves as the Debtor's financial advisors. Moore Freight estimated assets and debts of $10 million to $50 million. CEO Dan R. Moore signed the petitions. Counsel for the Debtor's pre-bankruptcy and DIP lender, Marquette Transportation Finance, Inc., are Linda W. Knight, Esq., at Gullett, Sanford, Robinson & Martin, PLLC; and Thomas J. Lallier, Esq., at Foley & Mansfield PLLP. NEW ENTERPRISE: Moody's Changes Ratings Outlook to Negative ----------------------------------------------------------- Moody's Investors Service revised the rating outlook for New Enterprise Stone & Lime to negative from stable and affirmed its existing ratings, including its Caa1 corporate family rating and Caa1-PD probability of default rating. The following ratings actions were taken: Caa1 Corporate Family Rating, affirmed Caa1-PD Probability of Default, affirmed Caa3, LGD5- 84% on senior unsecured notes, affirmed Caa1 on senior secured cash-pay and PIK Notes affirmed, LGD3-45% revised to LGD3-43% Rating outlook revised to negative from stable Ratings Rationale: The change in outlook to negative from stable reflects the company's prolonged weak operating performance as it continues to grapple with ongoing soft demand in its key markets. As a result, operating margins remain depressed, adjusted debt leverage exceeds its previous peak, and its interest coverage and internal sources of liquidity remain weak. The Caa1 corporate family rating reflects the company's modest scale, seasonality of its business, limited geographic diversification, concentration of business with Pennsylvania DOT, very high financial leverage, low operating margins and currently weak construction end markets. The rating, however, is supported by the company's adequate liquidity, strong position in its core markets, prospects for stabilizing and ultimately recovering construction spending, multi-generational family stewardship, and prudent acquisition and growth strategy. Moody's expects that various fiscal constraints at the federal and state levels on the infrastructure and transportation programs continue to negatively affect the company's construction end market activity and put pressure on its operating performance, leaving limited opportunities for material improvement in the near term. As a result, without an improvement in earnings, debt-to- EBITDA leverage is likely to remain elevated and at risk of rising further. The PIK interest component of its senior secured notes provides liquidity relief, but at the same time increases the company's debt burden. New Enterprise has an adequate liquidity position, which reflects its limited cash balances, and high working capital needs, reliance on its $145 million ABL revolving credit facility due March 2017 and limited alternate liquidity sources as all assets are fully encumbered. The company has a favorable debt maturity profile as its senior secured and senior unsecured notes do not mature until 2018. The rating would likely be downgraded if the company continues to experience declining profitability, if adjusted debt-to-EBITDA leverage continues to exceed 9x, or if liquidity and coverage metrics deteriorate further. Given current weak end market conditions and the associated weak credit metrics as well as limited opportunities for material improvement, upward pressure on the ratings is unlikely in the intermediate term. However, over a longer time horizon, material de-levering resulting in adjusted debt-to-EBITDA consistently falling below 6.0x, and EBIT-to-Interest exceeding 1.5x combined with improved profitability could result in ratings upgrade. Building additional geographic diversity, scale, and customer diversity would also improve the company's credit risk profile. The principal methodology used in this rating was the Global Building Materials Industry Methodology published in July 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. New Enterprise Stone & Lime, Co., Inc. is a privately held, vertically-integrated construction materials supplier, heavy/highway construction contractor, and traffic safety services and equipment provider. The company operates 52 quarries and sand deposits, 32 hot mix asphalt plants, 20 fixed and portable ready mixed concrete plants, five concrete production plants, three lime distribution centers, seven construction supply centers, and in its traffic safety equipment segment - five manufacturing facilities and a national network of sales facilities. NESL's operations are primarily concentrated in Pennsylvania and Western New York, with reach into the adjacent states including Delaware, Maryland, West Virginia, Virginia, and New Jersey. In fiscal year 2013 ending February 28, 2013, the company generated $677 million in revenues and $38 million in adjusted EBITDA. OCEAN DRIVE: Court Dismisses Chapter 11 Cases --------------------------------------------- The U.S. Bankruptcy Court has approved the motions of Ocean Drive Investment LLC and Cavalier Hotel LLC to dismiss their Chapter 11 cases. ODI is the former owner of a 46-room hotel known as the Cavalier Hotel, and CavHotel is the former management company of the Hotel. The Debtors attempted but were unable to propose a confirmable plan of reorganization before the March 13, 2013 foreclosure sale of the hotel. Ridge Hill Holdings-Miami LLC, which obtained a judgment of foreclosure in June 2012 and owed $9.9 million on a secured promissory note as of the bankruptcy filing, sought the foreclosure sale. Ridge Hill emerged as the successful bidder at the sale. Since ODI is no longer owner of the property, neither ODI nor CavHotel are capable of proposing a plan of reorganization that either reorganizes the indebtedness on the hotel or provides returns to creditors other than Ridge Hill from the unencumbered assets they have on hand. Besides the hotel, the Debtors have few, if any, remaining assets and the majority of their assets appear to be encumbered by liens or interests in favor of Ridge Hill that were foreclosed in the state court action. The Debtors do not believe the conversion of their cases to Chapter 7 will provide distributions to unsecured creditors because in addition to the facts that there are no encumbered assets to distribute, the guaranty issued by CavHotel ensures that Ridge Hill will receive the lion's share of any such distributions. In February, the Hon. Robert A. Mark of the U.S. Bankruptcy Court for the Southern District of Florida entered an order granting the motion filed by Ridge Hill Holdings-Miami to strike Ocean Drive's joint motion to enjoin the foreclosure sale. On Feb. 12, 2013, secured judgment creditor and first mortgage holder Ridge Hill stated that because the original plan sponsor backed out and the Debtors have abandoned the Plan, it is simply impossible for the Debtors to establish cause to enjoin the foreclosure sale because it cannot put on a prima facie case for confirmation of the Plan. The Debtors requested for the re-imposition of the automatic stay based upon the Court's order granting stay relief, and enjoining the sale scheduled by Ridge Hill of the hotel. The Debtors said they intend to file an amended Plan. About Ocean Drive Investment and Cavalier Hotel Ocean Drive Investment LLC and Cavalier Hotel LLC filed for Chapter 11 protection (Bankr. S.D. Fla. Case No. 12-30448 and 12-30451) on Aug. 28, 2012, in Miami. ODI is the owner of the Cavalier hotel located at Ocean Drive, in Miami's South Beach, facing the Atlantic Ocean. The Hotel has 46 rooms and is just within walking distance to bars, shops, dining, nightlife, and the nonstop action of South Beach. Cavalier Hotel LLC is the management company that operates and manages the Hotel. Ocean Drive has scheduled assets of $16,000,000 and liabilities of $10,558,303 as of the Petition Date. Cavalier Hotel LLC estimated under $50,000 in assets and at least $10 million in liabilities. The Debtors are represented by Nicholas B. Bangos, Esq., in Miami. OP-TECH ENVIRONMENTAL: Inks $6MM Financing Agreement with Accord ---------------------------------------------------------------- OP-TECH Environmental Services, Inc., on June 18, 2013, entered into a financing arrangement with Accord Financial, Inc. The Financing Arrangement consists of (1) a $1 million term loan evidenced by a promissory note, dated June 18, 2013, from the Company to the Lender, and (2) up to $5 million under an accounts receivable purchase and sale facility pursuant to a Master Purchase and Sale Agreement and Addendum to Master Purchase and Sale Agreement, both dated June 18, 2013, by and between the Company and Lender. The Financing Arrangement enabled the Company to discharge and terminate its prior credit facilities with First Niagara Bank, N.A. As of March 31, 2013, outstanding debt under the Prior Facilities totaled approximately $6.8 million. Initial proceeds from the Financing Arrangement were primarily used to repay the debt outstanding under the Prior Facilities at a discounted payoff amount equal to 40 percent of the aggregate principal balance plus accrued and unpaid interest (approximately $2.7 million including interest). Additional amounts available under the Financing Arrangement may be used for general corporate and working capital purposes. The Term Loan will mature on the earlier of (i) June 30, 2016, and (ii) the termination of the Factoring Agreement. The Factoring Agreement has a term of one year and is renewable from year to year thereafter unless terminated by either the Company or the Lender. The Term Loan is payable in monthly principal installments of $27,777.78 each together with interest thereon at a floating rate equal to Branch Banking and Trust Company's Prime Rate plus 12.75 percent per annum, accrued daily and calculated on the basis of a year of 360 days. Under the terms of the Factoring Agreement, the Lender may, at its sole discretion, purchase certain of the Company's eligible accounts receivable. Upon any acquisition of an account receivable, the Lender will advance to the Company up to 80 percent of the face amount of the account receivable. In the event that receivable remains outstanding beyond 90 days of the advance, or, at the Lender's option, 120 days, then the Company will be required to either repay the advance or replace that receivable with another eligible account receivable. Each account receivable acquired by Lender will be subject to a discount rate of 0.88 percent of the face amount of each account receivable for 25 days and at the Lender's option, that account receivable may be refactored for two 25-day periods at the discount rate of 0.88 percent per period, subject to prorating from the date of payment. The Company has agreed to sell to the Lender a minimum of $3 million of accounts receivable per calendar quarter. However, the maximum amount funded by Lender at any one time may not exceed $5,000,000. A copy of the Form 8-K is available for free at: http://is.gd/Najc89 East Syracuse, N.Y.-based OP-TECH Environmental Services, Inc., provides comprehensive environmental and industrial cleaning and decontamination services predominately in New York, New England, Pennsylvania, New Jersey, and Ohio. Dannible & McKee, LLP, in their audit report, dated May 14, 2013, for the fiscal year ended Dec. 31, 2012, expressed substantial doubt about OP-TECH Environmental's ability to continue as a going concern. The independent auditors noted that the Company has negative working capital and a stockholders' deficit at Dec. 31, 2012, and caused violations of the Company's financing agreements. The Company reported net income of $1.0 million on $32.3 million of revenues in 2012, compared with a net loss of $7.5 million on $30.7 million of revenues in 2011. The Company's balance sheet at March 31, 2013, showed $8.99 million in total assets, $12.79 million in total liabilities and a $3.79 million shareholders' deficit. ORCHARD SUPPLY: Section 341(a) Meeting Set on July 23 ----------------------------------------------------- Patton Tiiara notified the Court that a meeting of creditors in the bankruptcy case of Orchard Supply Hardware Stores will be held on July 23, 2013, at 1:00 pm, at J. Caleb Boggs Federal Building, 844 King Street, Wilmington, DE, 2nd Floor, Room 2112. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This meeting of creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. About Orchard Supply San Jose, Cal.-based Orchard Supply Hardware Stores Corporation operates neighborhood hardware and garden stores focused on paint, repair and the backyard. It was spun off from Sears Holdings Corp. in 2012. Orchard Supply and its two affiliates delivered their voluntary petitions for protection under Chapter 11 of the Bankruptcy Code on June 16, 2013. The case is pending at the United States Bankruptcy Court for the District of Delaware before Hon. Christopher S. Sontchi. Michael W. Fox signed the petitions as senior vice president and general counsel. The Debtors disclosed total assets of $441,028,000 and total debts of $480,144,000. Stuart M. Brown, Esq., at DLA Piper LLP (US), in Wilmington, Delaware; and Richard A. Chesley, Esq., Chun I. Jang, Esq., and Daniel M. Simon, Esq., at DLA Piper LLP (US), in Chicago, Illinois, are the Debtors' counsel. Moelis & Company LLC serves as the Debtors' investment banker. FTI Consulting, Inc., serves as the Debtors' financial advisors. A&G Realty Partners, LLC, serves as the Debtors' real estate advisors. BMC Group Inc. is the Debtors' claims and noticing agent. ORECK CORP: Wants to Hire Carl Marks as Crisis Manager ------------------------------------------------------ Oreck Corporation, et al., ask the U.S. Bankruptcy Court for the Middle District of Tennessee for permission to employ Carl Marks Advisory Group LLC as crisis manager. Michael Robbins, who is an independent contractor to Carl Marks, will serve on a full-time basis as Interim president and chief restructuring officer of the Debtors, and Jeffrey K. Kies, who is an independent contractor to Carl Marks, will serve on a full-time basis as the interim chief financial officer of the Debtors. In connection with the services to be rendered to the Debtors under the agreement, it is anticipated that Carl Marks will also provide: (i) the services of P. woodland Harris, a partner at Carl Marks, as the partner in charge of the engagement; and (ii) the services of f. Duffield Meyercord, also, a partner at Carl Marks The Debtor agreed to compensate Carl Marks a fixed monthly amount of $145,000, which will include all compensation to be paid to Messrs. Robbins and Kies by Carl Marks in connection with the matter, plus any out-of-pocket expenses. Carl Marks received a prepetition retainer from the Debtors of $80,000 to be applied against any unpaid fees and expenses earned postpetition. To the best of the Debtors' knowledge, Carl Marks is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. A June 25, hearing at 9 a.m., has been set. 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. The Debtor estimated at least $10 million in assets and liabilities as of the Chapter 11 filing. William L. Norton III, Esq., at Bradley Arant Boult Cummings LLP, serves as counsel to the Debtor. BMC Group Inc. is the claims and notice agent. Sawaya Segalas & Co., LLC serves as financial advisor. The U.S. Trustee appointed six creditors to the Official Committee of Unsecured Creditors. Daniel H. Puryear, Esq., at Puryear Law Group, and Sharon L. Levine, Esq., and Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP represent the Committee. The Committee tapped to retain Gavin/Solmonese LLC as it financial advisor. ORECK CORP: Creditors Have Until Sept. 13 to File Claims -------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Tennessee established Sept. 13, 2013, as the last day for any individual or entity to file proofs of claim against Oreck Corporation, et al. 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. The Debtor estimated at least $10 million in assets and liabilities as of the Chapter 11 filing. William L. Norton III, Esq., at Bradley Arant Boult Cummings LLP, serves as counsel to the Debtor. BMC Group Inc. is the claims and notice agent. Sawaya Segalas & Co., LLC serves as financial advisor. The U.S. Trustee appointed six creditors to the Official Committee of Unsecured Creditors. Daniel H. Puryear, Esq., at Puryear Law Group, and Sharon L. Levine, Esq., and Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP represent the Committee. The Committee tapped to retain Gavin/Solmonese LLC as it financial advisor. ORECK CORP: Files Schedules of Assets and Liabilities ----------------------------------------------------- Oreck Corporation filed with the U.S. Bankruptcy Court for the Middle District of Tennessee its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $0 B. Personal Property $18,013,249 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $9,698,613 E. Creditors Holding Unsecured Priority Claims $830,833* F. Creditors Holding Unsecured Non-priority Claims $4,403,395* ----------- ----------- TOTAL $18,013,249 $14,932,841* * plus unknown A copy of the schedules is available for free at http://bankrupt.com/misc/OreckCorp_SAL.pdf 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. The Debtor estimated at least $10 million in assets and liabilities as of the Chapter 11 filing. William L. Norton III, Esq., at Bradley Arant Boult Cummings LLP, serves as counsel to the Debtor. BMC Group Inc. is the claims and notice agent. Sawaya Segalas & Co., LLC serves as financial advisor. The U.S. Trustee appointed six creditors to the Official Committee of Unsecured Creditors. Daniel H. Puryear, Esq., at Puryear Law Group, and Sharon L. Levine, Esq., and Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP represent the Committee. The Committee tapped to retain Gavin/Solmonese LLC as it financial advisor. OTTER TAIL: S&P Raises Senior Unsecured Debt Rating From 'BB+' -------------------------------------------------------------- Standard & Poor's Ratings Services said it raised its corporate credit rating on Fergus, Minn.-based Otter Tail Corp. and its subsidiary Otter Tail Power Co. (OTP) to 'BBB' from 'BBB-'. The outlook is stable. At the same time, S&P raised the rating on Otter Tail Power's senior unsecured debt to 'BBB-' from 'BB+'. "The upgrade reflects our assessment of the company's improved business risk profile stemming from its strategic focus on its core utility business, effective management of regulatory risk, and the sustained improvement in financial measures," said Standard & Poor's credit analyst Matthew O'Neill. S&P expects that the company will continue to favor moderate financial policies that support its credit measures. Based on the portfolio of both the regulated utility and unregulated businesses, S&P considers Otter Tail Corp.'s consolidated business risk profile to be "strong" and the consolidated financial risk profile to be "significant" under S&P's criteria. S&P also considers Otter Tail's liquidity to be "strong". The stable rating outlook on Otter Tail Corp. reflects Standard & Poor's baseline forecast that adjusted consolidated FFO to debt will equal about 18% and adjusted debt to EBITDA will be about 4x over the next 12 to 18 months. Fundamental to S&P's forecast is the company's ability to effectively manage its regulatory relationships, leading to constructive regulatory outcomes. The outlook also reflects S&P's expectation that the company's utility will continue to account for the majority of consolidated cash flows. S&P could lower the ratings if adjusted FFO to total debt drops to less than 15% and adjusted total debt to EBITDA rises to more than 4.5x on a sustained basis. S&P could also lower the rating if the financial performance of the regulated business wanes or expected cash flow from unregulated businesses is slow to materialize due to an unexpected downturn in industrial activity and economic growth. S&P could raise the ratings if adjusted FFO to debt rises to more than 23% and total debt to EBITDA falls below 3.5x on a sustained basis. PARK CENTER: Case Summary & Unsecured Creditors ----------------------------------------------- Debtor: Park Center, LLC 470 Washington Street Brighton, MA 02135 Bankruptcy Case No.: 13-13735 Chapter 11 Petition Date: June 19, 2013 Court: U.S. Bankruptcy Court District of Massachusetts (Boston) Judge: William C. Hillman Debtors' Counsel: Christopher M. Condon, Esq. MURPHY & KING, PROFESSIONAL CORPORATION One Beacon Street, 21st floor Boston, MA 02108 Tel: (617) 423-0400 (ext. 441) Fax: (617) 423-0498 E-mail: cmc@murphyking.com - and ? Andrew G. Lizotte, Esq. MURPHY & KING, PROFESSIONAL CORPORATION One Beacon Street, 21st floor Boston, MA 02108 Tel: (617) 423-0400 Fax: (617) 556-8985 E-mail: agl@murphyking.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 Affiliates that simultaneously filed for Chapter 11: Debtor Case No. ------ -------- Park Center 2, LLC 13-13736 Assets: $1,000,001 to $10,000,000 Debts: $10,000,001 to $50,000,000 Amherst Plaza, LLC 13-13737 Assets: $1,000,001 to $10,000,000 Debts: $10,000,001 to $50,000,000 The petitions were signed by Nicholas Heras, Jr., manager. A. Park Center's list of its largest unsecured creditors filed with the petition contains only one entry: Entity Nature of Claim Claim Amount ------ --------------- ------------ Middlesex Federal Savings, F.A. -- $6,579,000 One College Avenue Somerville, MA 02144 B. A copy of Park Center 2's list of its two largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/mab13-13736.pdf C. Amherst Plaza did not file a list of creditors together with its petition. PERDUE PROPERTIES: Case Summary & 9 Unsecured Creditors ------------------------------------------------------- Debtor: Perdue Properties, Inc. 819 Elm Street, #8 Manchester, NH 03101 Bankruptcy Case No.: 13-11581 Chapter 11 Petition Date: June 19, 2013 Court: U.S. Bankruptcy Court District of New Hampshire (Manchester) Debtor's Counsel: Eleanor Wm. Dahar, Esq. VICTOR W. DAHAR PROFESSIONAL ASSOCIATION 20 Merrimack Street Manchester, NH 03101 Tel: (603) 622-6595 E-mail: edahar@att.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 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/nhb13-11581.pdf The petition was signed by Scott Perdue, president. Affiliate that filed separate Chapter 11 petition: Entity Case No. Petition Date ------ -------- ------------- Scott Perdue and Katherine Raymond aka Kathy Perdue 13-11582 6/20/2013 PROFILE TECHNOLOGIES: WaveTrue Plan Takes Effect; Exits Chapter 11 ------------------------------------------------------------------ WaveTrue, Inc., formerly known as Profile Technologies, Inc., on June 21 disclosed that its Plan of Reorganization (Plan) from Chapter 11 bankruptcy proceedings became effective on May 22, 2013. Pursuant to the Plan, new investors have made cash investments in exchange for 80% of the stock of the reorganized corporation. The unsecured creditors will receive an aggregate of 10% of the stock of the reorganized corporation. Existing shareholders of Profile Technologies will retain an aggregate of 10% of the stock of the reorganized corporation. Shareholders of Profile Technologies are cautioned that the existing price of their shares as reflected in market quotations may not reflect the changes in ownership. Professionals assisting the Company during the Chapter 11 process have been partially paid in cash and have accepted the Company's notes for the balance of their fees and expenses. The Company's New Board of Directors has appointed new executive management. The members of management are: -- Ronald Floit CEO; -- John DeWees President; and -- Robert LeBoyer CFO The Plan of Reorganization is available on the Company's website http://www.wavetrue.com About Profile Technologies Profile Technologies, Inc. (otc pink:PRTK.Q) -- http://www.profiletech.net-- is headquartered in Manhasset, N.Y. with an Operations and Research facility in Albuquerque, N.M. It is the developer and owner of proprietary, patented technologies that utilize electromagnetic waves to detect and characterize corrosion and other anomalies on cased, insulated and other pipelines. The Company filed for Chapter 11 protection on May 9, 2011 (Bankr. E.D.N.Y. Case No. 11-73269). Judge Alan S. Trust (Central Islip) presides over the case. Randall S.D. Jacobs, Esq., represents the Debtor as counsel. The Debtor's balance sheet at March 31, 2011, showed $242,675 in total assets and $1,372,736 in total liabilities as of March 31, 2011. PHOENIX COMPANIES: Moody's Eyes Downgrade for 'Caa1' Debt Rating ---------------------------------------------------------------- Moody's Investors Service is maintaining the review for downgrade of The Phoenix Companies, Inc.'s (Phoenix's; NYSE: PNX) Caa1 senior debt rating and the Ba2 insurance financial strength (IFS) rating of the company's life insurance subsidiaries, led by Phoenix Life Insurance Company and the B1 (hyb) debt rating of Phoenix Life's surplus notes. Ratings Rationale: Moody's stated that the continuing review for downgrade is driven by the company's prolonged delays in the filing of its GAAP financial statements driven by the complexity and detailed level of auditor review. Other drivers include Phoenix's weak accounting procedures and controls, and the potential challenges in managing the underlying business operations given the current management distractions as well as the potential for increased surrenders by policyholders. Phoenix will likely conclude it has multiple material weaknesses once it completes its restatement. The company has not provided a specific time frame for completion of the restatement. On May 22, 2013, Phoenix announced that it had received consents and waivers from noteholders representing approximately 60% of the outstanding principal amount of its $253 million 7.45% Quarterly Interest Bonds due 2032. The approval of the amendments and waiver allows Phoenix until December 31, 2013 to provide the bond trustee with its Form 10-Q (Q3 2012, Q1-Q3 2013) and its 2012 Form 10-K. According to Moody's, Phoenix's GAAP restatement continues to move forward, albeit at a slow pace, and it expects the company to provide a public update on the progress of the restatement by June 30, 2013. Moody's noted that due to the protracted GAAP restatement process, Phoenix did not file its YE 2012 audited statutory financial statements with its regulators by their respective deadlines with the Connecticut Insurance Department (June 1, 2013) and the New York State Department of Financial Services (May 31, 2013). The company has received 30-day and 60-day extensions, respectively, for submitting the audited statutory financials. The rating agency stated that the review for downgrade of the ratings will continue to focus on Phoenix's ability to file its audited GAAP and audited statutory financial statements within the required deadlines and related developments on any potential acceleration of the outstanding notes. Moody's added that the review will also consider management's efforts to remediate any accounting control weaknesses that are likely to be reported. Rating Drivers: Moody's said the following factors could lead to a confirmation of Phoenix's and its operating companies' ratings: filing of its audited GAAP and statutory financials within their extension periods; remediation of any accounting control weaknesses; return on capital (ROC) consistently above 0%; NAIC RBC ratio maintained above 300%; cash flow coverage of greater than 2x on a consistent basis. Conversely, the following factors could lead to a downgrade of Phoenix's ratings: inability to timely file its audited GAAP or statutory financial statements or obtain the necessary extensions/waivers; an acceleration of the senior notes; NAIC RBC ratio falls below 300%; cash flow coverage less than 2x; cash outflows on the company's existing policies substantially increase from their current pace. The following ratings remain on review for downgrade: The Phoenix Companies, Inc. -- senior unsecured debt rating at Caa1; Phoenix Life Insurance Company -- insurance financial strength rating at Ba2, surplus note rating at B1 (hyb); PHL Variable Insurance Company -- insurance financial strength rating at Ba2. The principal methodology used in this rating was Moody's Global Rating Methodology for Life Insurers published in May 2010. Phoenix is an insurance organization headquartered in Hartford, Connecticut. As of June 30, 2012, Phoenix reported total assets of about $21.2 billion and stockholders' equity of approximately $0.9 billion. Moody's insurance financial strength ratings are opinions of the ability of insurance companies to pay punctually senior policyholder claims and obligations. PNM RESOURCES: Moody's Changes Ratings Outlook to Positive ---------------------------------------------------------- Moody's Investors Service changed the rating outlook of PNM Resources, Inc. (PNMR: senior unsecured Ba1) and its subsidiaries Public Service Company of New Mexico (PNM: senior unsecured Baa3) and Texas-New Mexico Power Company (TNMP: senior unsecured Baa2), to positive from stable. All the ratings of PNMR, PNM, and TNMP are affirmed. "The positive outlooks acknowledge our view that the New Mexico regulatory framework is improving and becoming more credit supportive" said Jeffrey Cassella, Moody's Analyst, "reflecting the use of enhanced recovery mechanisms and implementation of the use of a future test-year in rate case filings." "The positive outlooks also consider the continuing credit supportive regulatory framework for T&D utilities in ERCOT as well as the strong financial metrics generated at each entity." PNMR's positive outlook reflects Moody's expectation that the regulatory environment in New Mexico continues to improve and TEXAS remains supportive of the T&D business; financial metrics will remain consistent with investment grade US regulated electric and that the timeline for the San Juan environmental compliance requirements plays out such that PNM is able to recover prudently incurred costs and investments in a timely manner. The outlook also assumes that planned capital expenditures will be financed in a manner that is consistent with the entities' current financial position. The New Mexico regulatory framework, historically, has not been as constructive as most US state regulatory jurisdictions in terms of predictability and timeliness of rate decisions and overall supportiveness to credit quality, but has recently shown signs of improvement. However, Moody's views the New Mexico Regulatory environment is improving as it has seen signs of improved coordination between regulators, PNM, and intervenors, particularly with the finalization of the future test year rule, which helps reduce regulatory lag. In addition, PNM has reasonable cost recovery mechanisms, which include a fuel and purchased power clause and a renewable energy rider which helps streamline regulatory proceedings for renewable spending resulting in more timely recovery of some of its costs outside of a general rate case. Furthermore, in November 2012, New Mexico voters passed measures to reduce the NMPRC's responsibilities of non-utility tasks, which allow the Commission to focus solely on the state's utilities and utility related matters. Voters also have elected qualification requirements, based on educational background and experience, for new commissioners elected to the NMPRC. TNMP's lower risk transmission and distribution operations are regulated by the PUCT, a credit positive given the relatively transparent and supportive regulatory framework that tends to provide timely recovery for prudently incurred costs and investments. In addition, TNMP's T&D operations in ERCOT have no provider of last resort obligations which is a significant credit positive as TNMP is only obligated to deliver power that retail customers have requested from retail energy providers. Furthermore, TNMP utilizes formula based rate making for transmission investments and has the ability to utilize formula based ratemaking for distribution investments (although to date, they have yet to exercise this alternative). Combined, Moody's thinks these recovery mechanisms mitigates some of the regulatory lag associated with using a historical test year, and recovers its smart meter investments via a rate surcharge. When considering TNMP's reasonable allowed ROEs, Moody's believes that ERCOT's regulatory framework for T&D's is significantly more supportive than other state jurisdictions and is almost as supportive as federal transmission regulation. PNMR's Ba1 rating is primarily driven by PNM's credit factors, including the improving although somewhat challenging regulatory environment in New Mexico, reasonable cost recovery mechanisms, and investment grade credit metrics that help offset the below average New Mexico regulatory framework. The rating also reflects the expectation that management will continue to maintain its focus on regulated operations. PNM's Baa3 senior unsecured rating reflects an improving although somewhat challenging regulatory environment; reasonable operating cost recovery mechanisms; and financial metrics that are consistent with regulated US electric utilities rated in the high Baa range. TNMP's Baa2 Issuer Rating reflects the low risk nature of its transmission and distribution business; the stability and predictability of its revenues and cash flows; its credit supportive regulatory environment and financial metrics that are appropriate for its rating. The ratings could be upgraded if the improvement in the credit supportiveness of the New Mexico regulatory environment is sustained or if the Texas regulatory framework remains credit supportive of T&D businesses, while the financial metrics at each entity continue to remain strong compared to their respective rating category. The positive rating outlooks could be stabilized or ratings downgraded if Moody's believes the regulatory environments PNMR and its subsidiaries operate in were to become less supportive or predictable such that there is an adverse rate case ruling or cost recovery disallowances; or if PNM or TNMP experience prolonged operational difficulties or increased non-recoverable costs causing consolidated financial metrics to decline to levels inconsistent with their respective rating category. The principal methodology used in this rating was Regulated Electric and Gas Utilities published in August 2009. Headquartered in Albuquerque, New Mexico, PNMR is a holding company whose primary subsidiaries are the regulated electric utilities, PNM and TNMP. PROPHOTONIX LTD: Enters Into Credit Facility Agreement with Tiger ----------------------------------------------------------------- ProPhotonix Limited on June 21 disclosed that it has entered into a credit facility agreement with Tiger Investments 1 LLC of up to $2 million, and a credit facility agreement with Mark Hawtin of up to $1 million, together equaling in aggregate amount up to $3 million. The Loans will provide the Company with sufficient working capital to meet the Company's present and future needs, for at least the next 12 months. Loan Terms and related information Drawdown, Repayment and Interest The Loans are available to the Company until, and must be repaid in full, by June 19, 2017. The Company may at any time prior to the Maturity Date, repay all or any part of the facility which it has drawn down without penalty. Any drawdown or repayment of the Loans will be made 2/3 against the Tiger Loan Facility and 1/3 against the Hawtin Loan Facility. The Loans do not constitute revolving credit facilities and as such once monies have been borrowed and repaid under the Loans, such amounts are not available to be borrowed again. An interest rate of 12.25% will be applied to all monies drawn down under the Loans. For the first 12 months of the Loans the Company shall only pay interest on any monies drawn down. For the following 36 months of the Loans, the Company will make monthly amortized payments of outstanding principal and interest, with any remaining unpaid principal and interest being due and payable on the Maturity Date. Under the terms of the Hawtin Loan Facility, the Company must use 50% of any amounts advanced by Hawtin to make additional principal payments under the Bond. Whilst the Loans remain outstanding, the Company has agreed with the Lenders that it will not pay any cash dividends to shareholders. On the fourth anniversary of the Tiger Loan Facility and the Hawtin Loan Facility, or earlier upon termination of such facilities at the option of the Company, the following fees will be payable by the Company to the Lenders: a fee of $60,000 will be payable to Tiger and fee of $15,000 will be payable to Hawtin. Event of Default and Security The Loans contain events of default relating to non-payment to the Lenders, insolvency proceedings of the Company, cross-default as between the Tiger Loan Facility and the Hawtin Loan Facility and termination of Mr. Tim Losik's employment by the Company without cause. The Loans are secured by security granted over all of the assets of the Company and each of the following of the Company's subsidiaries: ProPhotonix Limited, Stocker Yale (UK) Limited and ProPhotonix (IRL) Limited. The security for the loans contains provisions providing for such security to, in the case of trade accounts, rank behind any similar security given in respect of any future asset backed lending. In the case of the security for the Loans being provided by ProPhotonix Limited (an English subsidiary of the Company), such security ranks behind the security granted by such company to Barclays Bank plc which security secures its current asset backed lending facility. Board representation Dietmar Klenner, a longtime member of the Company's Board, will not stand for reelection at the upcoming 2013 Annual Meeting of Stockholders of the Company. In connection with the Tiger Loan Facility, Tiger has the right to nominate up to two directors to the Company's Board as follows: If the Company's Board consists of five directors, then Tiger will have the right to nominate one of the five directors to serve on the Company's Board. If the Company's Board is to consist of six directors, then Tiger will have the right to nominate a seventh director to the Board. The Company and Tiger have agreed that at all times the Board of the Company shall consist of a majority of directors who are independent directors. Tim Losik is Tiger's nominated Director at this time. Hawtin has the right to attend and observe meetings of the Board of Directors. Hawtin will not have voting rights at these meetings. Existing Hawtin arrangements and consideration for the Loans On December 10, 2010, ProPhotonix (IRL) Limited issued a EUR1,972,523 8% senior fixed rate secured bond to Hawtin. On June 13, 2011, ProPhotonix (IRL) Limited entered into an agreement with Hawtin pursuant to which it cancelled the Prior Bond and issued a new bond instrument constituting a EUR1,972,523 8% senior fixed rate secured bond, with a maturity date of June 30, 2015. As at the date of this announcement, the unpaid balance pursuant to the Bond, before conversion of Hawtin Shares, is EUR1,570,683. Hawtin and ProPhotonix (IRL) Limited have agreed to reduce the current unpaid balance of the Bond and to amend the Bond. Hawtin has agreed to convert and cancel EUR144,324 of the unpaid balance of the Bond into 7,605,945 shares of common stock of the Company at a price of EUR0.019 per share. Pursuant to an agreement between Hawtin and Tiger, Hawtin has instructed the Company to issue the Hawtin Shares to Tiger. Following this instruction, Tiger will be interested in 7,605,945 shares of common stock of the Company representing approximately 9.1 percent of the Company. Following this partial conversion of the Bond into the Hawtin Shares, the Bond has a remaining unpaid balance of EUR1,426,359 with a maturity date of June 30, 2017. Application has been made to the London Stock Exchange for the Hawtin Shares to be admitted to trading on AIM. It is expected that admission will become effective and that dealings will commence on June 26, 2013. Following admission, Tiger will be interested in 7,605,945 common shares of the Company representing 9.1 percent of the Company's issued share capital. In consideration for amending the Bond, ProPhotonix (IRL) Limited has agreed to pay to Hawtin a fee equal to EUR31,413 at the maturity of the Bond, being two percent of the amount currently outstanding. The Bond, as amended, contains events triggering an acceleration of the outstanding amounts relating to non-payment to Hawtin, insolvency proceedings of the Company and a change of control of the Company, among others. Warrant In connection with the amendment to the Bond, the Company has agreed to issue Hawtin a ten-year warrant to purchase 1,900,000 shares of common stock of the Company at a purchase price of $0.03 per share. On exercise these warrants will represent 2.3 percent of the Company's issued share capital. Related Party Transaction Tiger is owned and controlled by the wife of Tim Losik, Patricia Losik. As Mr. Losik is a director and the Chief Executive of the Company, the entry into the Tiger Loan Facility constitutes a "related party transaction" for the purposes of AIM Rule 13. The Directors (excluding Tim Losik) consider, having consulted with the Company's Nominated Adviser, N+1 Singer, that the Tiger Loan Facility and its associated terms and conditions are fair and reasonable in so far the Company's shareholders are concerned. Restrictions on Share Dealings Tiger has agreed not to dispose of any interest in Common Shares: (i) for a period of 12 months from the date of this announcement; and (ii) for a further period of six months except through N+1 Singer in accordance with N+1 Singer's reasonable requirements for an orderly market. About ProPhotonix Headquartered in Salem, New Hampshire, ProPhotonix Limited -- http://www.prophotonix.com-- is an independent designer and manufacturer of diode-based laser modules and LED systems for industry leading OEMs and medical equipment companies. In addition, the Company distributes premium diodes for Oclaro, Osram, QSI, Panasonic, and Sony. The Company serves a wide range of markets including the machine vision, industrial inspection, defense, sensors, and medical markets. ProPhotonix has offices and subsidiaries in the U.S., Ireland, U.K., and Europe. REVSTONE INDUSTRIES: Committee Wants Units in Ch. 11 Before Sale ---------------------------------------------------------------- Matt Chiappardi of BankruptcyLaw360 reported that the creditors' committee in the Revstone Industries LLC Chapter 11 case balked at the company's plan to sell two nondebtor affiliates for at least $54 million, arguing the units should also be in bankruptcy before they hit the auction block. According to the report, the official committee of unsecured creditors filed a limited objection to Revstone's request in the U.S. Bankruptcy Court for the District of Delaware, and stated they don't have a problem with the idea of the sale of Contech Castings LLC and Contech Castings Real Estate. 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. ROCKWELL MEDICAL: Grants 310,000 Restricted Shares to Executives ---------------------------------------------------------------- The Compensation Committee of the Board of Directors of Rockwell Medical, Inc., made grants of restricted stock under the Company's Amended and Restated 2007 Long Term Incentive Plan for four of the "named executive officers": No. of Restricted Executive Position Shares Granted --------- ------------------------ ----------------- Robert Chioini Chief Executive Officer 100,000 Thomas Klema Chief Financial Officer 60,000 Dr. Ajay Gupta Chief Scientific Officer 75,000 Dr. Raymond Pratt Chief Medical Officer 75,000 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 March 31, 2013, showed $18 million in total assets, $28.5 million in total current liabilities, and a stockholders' deficit of $10.5 million. ROTECH HEALTHCARE: Douglas County Objects to 2nd Amended Plan ------------------------------------------------------------- BankruptcyData reported that the Douglas County Treasurer's Office filed with the U.S. Bankruptcy Court an objection to Rotech Healthcare's Second Amended Joint Chapter 11 Plan. The objection explains, "Under 11 U.S.C. Sections 506(b) and 511(a) and C.R.S. Section 39-10-104.5, Douglas County is entitled to postpetition interest on its Claim at 12% APR. Douglas County is oversecured because its lien is senior to all consensual liens. Therefore, Douglas County is entitled to postpetition interest under U.S.C. Section 506(b) on its secured claim," the report said, citing court documents. 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. 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. The Official Committee of Unsecured Creditors tapped Otterbourg, Steindler, Houston & Rosen, P.C., as counsel; Buchanan Ingersoll & Rooney PC as Delaware counsel; and Grant Thornton LLP as financial advisor. ROTECH HEALTHCARE: Equity Committee Can Tap Baker as Counsel ------------------------------------------------------------ Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware authorized the Official Committee of Equity Security Holders appointed in the Chapter 11 cases of Rotech Healthcare Inc., et al., to retain Baker & McKenzie LLP as counsel. The firm will be paid the following hourly rates: Position Hourly Rate -------- ----------- Partners $500 - $1,000 Of Counsel $400 - $700 Associates $295 - $600 Paraprofessionals $100 - $300 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. 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. The Official Committee of Unsecured Creditors tapped Otterbourg, Steindler, Houston & Rosen, P.C., as counsel; Buchanan Ingersoll & Rooney PC as Delaware counsel; and Grant Thornton LLP as financial advisor. ROTECH HEALTHCARE: Equity Committee Can Tap Bifferato as Counsel ---------------------------------------------------------------- Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware authorized the Official Committee of Equity Security Holders appointed in the Chapter 11 cases of Rotech Healthcare Inc., et al., to retain Bifferato LLC as its Delaware counsel. The Debtors previously objected to the Equity Committee's retention of Bifferato as Delaware counsel, saying the proposal should be contingent on the committee's ability to prove the company is solvent. The Debtors told Judge Walsh that the proposal to retain Bifferato isn't reasonable because, although the Equity Committee has insisted that Rotech is worth at least $143 million and possibly $273 million in excess of their liabilities, that estimated value is in doubt. The Debtors have asserted in court filings that their filing of a prepackaged reorganization plan offering 10 cents a share to existing stockholders doesn't justify appointing an official equity committee. The Debtors said their business "is insolvent by between $128 million and $188 million." The 10 cents being offered for each share represent a "gift" of $2.62 million made by the second-lien noteholders who are to become Rotech's new owners, the Debtors said. As further evidence of insolvency, the Debtors pointed to the second-lien notes currently trading at about half of face value. 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. 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. The Official Committee of Unsecured Creditors tapped Otterbourg, Steindler, Houston & Rosen, P.C., as counsel; Buchanan Ingersoll & Rooney PC as Delaware counsel; and Grant Thornton LLP as financial advisor. ROTHSTEIN ROSENFELDT: Judge OKs Settlement Over Investor's Claims ----------------------------------------------------------------- Nathan Hale of BankruptcyLaw360 reported that a Florida bankruptcy court approved a settlement between the trustee overseeing the liquidation of Ponzi schemer Scott Rothstein's law firm and former Rothstein investor Ira Sochet over Sochet's previously negotiated claims. According to the report, the Miami businessman's entities Ira Sochet Inter Vivos Revocable Trust and Investors Risk Advantage LP will be deemed to hold an allowed general nonpriority unsecured claim of $20 million against the Rothstein Rosenfeldt Adler PA estate and will be permitted to pursue claims against third parties up to a total recovery of $29.5 million. 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. ROSETTA GENOMICS: Annual General Shareholders' Meeting on July 29 ----------------------------------------------------------------- Rosetta Genomics Ltd. will hold its annual general meeting of the shareholders of the Company at 10 Plaut St., Rehovot, Israel, on July 29, 2013, at 16:00 (Israel time) for these purposes: 1. Re-election of Mr. Roy N. Davis to serve as a Class III director of the Company until the annual general meeting of the Company's shareholders to be held in 2016 in accordance with the Company's Articles of Association; 2. To approve an update to the remuneration of the directors of the Company; 3. Re-election of Mr. Gerald Dogon to serve as external director of the Company for an additional period of three years beginning on the date of approval by the Annual Meeting; 4. Re-election of Ms. Tali Yaron-Eldar to serve as external director of the Company for an additional period of three years beginning on the date of approval by the Annual Meeting; 5. Approval of remuneration for the external directors; 6. Approval of a compensation policy for the Company's directors and officers, in accordance with the requirements of the Israeli Companies Law, 1999; 7. Approval of an option grant to Mr. Ken Berlin, the chief executive officer of the Company; 8. Approval of an increase of the Company's registered (authorized) share capital and the corresponding amendment to the Articles; 9. Re-appointment of Kost, Forer, Gabbay & Kasierer, a member firm of Ernst & Young Global, as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2013, and until the next annual general meeting, and to authorize the Board to determine the remuneration of KFGK in accordance with the volume and nature of their services, provided that remuneration is also approved by the Audit Committee of the Board of Directors; and 10. To discuss the report of the independent registered public accounting firm and the Consolidated Financial Statements of the Company for the fiscal year ended Dec. 31, 2012. A copy of the Notice to Shareholders is available for free at: http://is.gd/DZq4eF About Rosetta Based in Rehovot, Israel, Rosetta Genomics Ltd. is seeking to develop and commercialize new diagnostic tests based on a recently discovered group of genes known as microRNAs. MicroRNAs are naturally expressed, or produced, using instructions encoded in DNA and are believed to play an important role in normal function and in various pathologies. The Company has established a CLIA- certified laboratory in Philadelphia, which enables the Company to develop, validate and commercialize its own diagnostic tests applying its microRNA technology. Rosetta Genomics disclosed a net loss of US$10.45 million on US$201,000 of revenue for the year ended Dec. 31, 2012, as compared with a net loss of US$8.83 million on US$103,000 of revenue during the prior year. The Company's balance sheet at Dec. 31, 2012, showed US$32.53 million in total assets, US$1.63 million in total liabilities and US$30.90 million in total shareholders' equity. Bankruptcy Warning In its annual report for the year ended Dec. 31, 2012, the Company said: "We will require substantial additional funding and expect to augment our cash balance through financing transactions, including the issuance of debt or equity securities and further strategic collaborations. On December 7, 2012, we filed a shelf registration statement on Form F-3 with the SEC for the issuance of ordinary shares, various series of debt securities and/or warrants to purchase any of such securities, either individually or in units, with a total value of up to $75 million, from time to time at prices and on terms to be determined at the time of such offerings. The filing was declared effective on December 19, 2012. However there can be no assurance that we will be able to obtain adequate levels of additional funding on favorable terms, if at all. If adequate funds are not available, we may be required to: * delay, reduce the scope of or eliminate certain research and development programs; * obtain funds through arrangements with collaborators or others on terms unfavorable to us or that may require us to relinquish rights to certain technologies or products that we might otherwise seek to develop or commercialize independently; * monetizing certain of our assets; * pursue merger or acquisition strategies; or * seek protection under the bankruptcy laws of Israel and the United States." SAN BERNARDINO, CA: NPFGC Hires Weil Gotshal After Winston DQ ------------------------------------------------------------- Erin Coe of BankruptcyLaw360 reported that National Public Finance Guarantee Corp. has retained Weil Gotshal & Manges LLP to represent it in the Chapter 9 bankruptcy proceedings of San Bernardino and Stockton, Calif., after a judge disqualified Winston & Strawn LLP from representing the bond insurer in the San Bernardino matter, it said Friday. According to the report, NPFG spokesman Kevin Brown said Weil Gotshal would replace Winston & Strawn in both cases. The move came in response to a June 13 decision by U.S. Bankruptcy Judge Meredith Jury granting the California Public Employees' Retirement System's motion to disqualify Winston, complaining that the firm has a conflict of interest that cannot be cured. As previously reported by The Troubled Company Reporter, CalPERS filed papers in May contending that Winston should be disqualified from continuing to represent NPFGC because the firm hired away a partner and two associates from the Charlotte, North Carolina, office of K&L Gates LLP. Those lawyers, the report relates, spent 500 hours in the San Bernardino bankruptcy working for CalPers, California's public employees' retirement fund. At a hearing June 13 in Riverside, California, U.S. Bankruptcy Judge Meredith A. Jury ruled that the hiring gave Winston has a conflict of interest that can't be solved by what's known as an ethical wall. Were the wall sufficient, Winston could continue as NPFGC's lawyers so long as the newly hired lawyers shared no information about Calpers. The report discloses that NPFGC argued unsuccessfully that the ethical wall was sufficient because it has no claims against CalPers, even though their interests admittedly were "not wholly aligned." Insurance companies like NPFGC contend that a municipality is barred from proposing a plan paying Calpers in full while forcing bondholders to sustain a loss, according to the report. About San Bernardino, Calif. San Bernardino, California, filed an emergency petition for municipal bankruptcy under Chapter 9 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 12-28006) on Aug. 1, 2012. San Bernardino, a city of about 210,000 residents roughly 65 miles (104 km) east of Los Angeles, estimated assets and debts of more than $1 billion in the bare-bones bankruptcy petition. The city council voted on July 10, 2012, to file for bankruptcy. The move lets San Bernardino bypass state-required mediation with creditors and proceed directly to U.S. Bankruptcy Court. The city is represented that Paul R. Glassman, Esq., at Stradling Yocca Carlson & Rauth. San Bernardino joined two other California cities in bankruptcy: Stockton, an agricultural center of 292,000 east of San Francisco, and Mammoth Lakes, a mountain resort town of 8,200 south of Yosemite National Park. SEVEN COUNTIES: Has Authority to Employ Hall Render as IT Counsel ----------------------------------------------------------------- Judge Joan Lloyd of the U.S. Bankruptcy Court for the Western District of Kentucky authorized Seven Counties Services, Inc., to employ Carol A. Romej, Esq., and the firm of Hall, Render, Killian, Heath & Lyman, PLLC, a special counsel to represent and advise it in the implementation of its new software system. The Debtor has agreed to pay Hall Render its standard hourly rates and all other charges such as expense reimbursements, all being subject to Court approval About Seven Counties Seven Counties Services Inc., a not-for-profit behavioural services provider from Louisville, Kentucky, filed for Chapter 11 protection (Bankr. W.D. Ky. Case No. 13-31442) in the hometown on April 4, 2013. The petition was signed by Anthony M. Zipple as president/CEO. The Debtor scheduled assets of $45,603,716 and scheduled liabilities of $232,598,880. Seiller Waterman LLC serves as the Debtor's counsel. Judge Joan A. Lloyd presides over the case. The agency generates more than $100 million a year in revenue and employs a staff of 1,400 providing services at 21 locations and 120 schools and community centers. SMART ONLINE: Stockholders OK Name Change to "MobileSmith Inc." --------------------------------------------------------------- Smart Online, Inc., held its annual meeting of stockholders on June 17, 2013, at which the stockholders: (1) elected Amir Elbaz, Shlomo Elia, and Ronen Shviki as directors of the Company, each for a one-year term of office to serve until the Company's 2014 annual meeting of stockholders and to serve until his successor will have been duly elected and qualified or until his earlier resignation or removal; (2) approved an amendment to Certificate of Incorporation to effectuate a name change from Smart Online, Inc., to MobileSmith, Inc.; (3) approved, on an advisory basis, the compensation of the Company's named executive officers; (4) indicated "every 3 years" as the preferred frequency of future advisory votes on executive compensation; and (5) ratified the appointment of Cherry Bekaert, LLP, as independent registered public accounting firm of the Company for the fiscal year ending Dec. 31, 2013. About Smart Online Durham, North Carolina-based Smart Online, Inc., develops and markets a full range of mobile application software products and services that are delivered via a SaaS/PaaS model. The Company also provides Web site and mobile consulting services to not-for- profit organizations and businesses. Smart Online disclosed a net loss of $4.39 million in 2012, as compared with a net loss of $3.54 million in 2011. The Company's balance sheet at March 31, 2013, showed $1.24 million in total assets, $29.82 million in total liabilities, and a $28.57 million total stockholders' deficit. Cherry Bekaert LLP, in Raleigh, North Carolina, 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 and has a working capital deficiency as of Dec. 31, 2012, which conditions raise substantial doubt about the Company's ability to continue as a going concern. SOLYNDRA LLC: Lien Fight Must Stay in Delaware, Judge Says ---------------------------------------------------------- Matt Chiappardi of BankruptcyLaw360 reported that a Delaware bankruptcy judge denied a request from a Solyndra LLC creditor to transfer to California a lien dispute connected to the company's sprawling headquarters, ruling that the issue is still a core proceeding and should be decided in the First State. According to the report, U.S. Bankruptcy Judge Mary F. Walrath said that the bankruptcy court has "quintessential core jurisdiction" over claims, and arguments that the Solyndra estate had no real interest in the lien dispute didn't fly with her. About Solyndra LLC Founded in 2005, Solyndra LLC was a U.S. manufacturer of solar photovoltaic solar power systems specifically designed for large commercial and industrial rooftops and for certain shaded agriculture applications. The Company had 968 full time employees and 211 temporary employees. Solyndra has sold more than 500,000 of its panels since 2008 and generated cumulative sales of over $250 million. Fremont, California-based Solyndra and affiliate 360 Degree Solar Holdings Inc. sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 11-12799) on Sept. 6, 2011. Solyndra is at least the third solar company to seek court protection from creditors since August 2011. Judge Mary F. Walrath presides over the Debtors' cases. The Debtors are represented by Pachulski Stang Ziehl & Jones LLP as legal adviser. AlixPartners LLP serves as noticing claims and balloting agent. Imperial Capital LLC serves as the company's investment banker and financial adviser. The Debtors also tapped former Massachusetts Governor William F. Weld, now with the law firm McDermott Will & Emery, to represent the company in government investigations and related litigation. BDO Consulting, a division of BDO USA, LLP, as financial advisor and BDO Capital Advisors, LLC, serves as investment banker for the creditors' panel. The Official Committee of Unsecured Creditors of Solyndra LLC has tapped Blank Rome LLP as counsel and BDO Consulting as financial advisors. In October 2011, the Debtors hired Berkeley Research Group, LLC, and designated R. Todd Neilson as Chief Restructuring Officer. Solyndra owed secured lenders $783.8 million, including $527.8 million to the U.S. government pursuant to a federal loan guarantee, and held assets valued at $859 million as of the Petition date. The U.S. Federal Financing Bank, owned by the U.S. Treasury Department, is the Company's biggest lender. When they filed for Chapter 11, the Debtors pursued a two-pronged strategy to effectuate either a sale of their business to a "turnkey" buyer who may acquire substantially all of Solyndra's assets or, if the Debtors were unable to identify any potential buyers, an orderly liquidation of the assets for the benefit of their creditors. Solyndra did not receive acceptable offers to buy the business as a going concern. Two auctions late last year brought in a total of $8 million. A three-day auction in February generated another $3.8 million. An auction in June generated $1.79 million from the sale of 7,200 lots of equipment. Solyndra filed a liquidating plan at the end of July and scheduled a hearing on Sept. 7 for approval of the explanatory disclosure statement. The Plan is designed to pay 2.5% to 6% to unsecured creditors with claims totaling as much as $120 million. Unsecured creditors with $27 million in claims against the holding company are projected to have a 3% dividend. The TCR reported on Nov. 12, 2012, Bloomberg News said Solyndra LLC gave formal notice that its reorganization plan was confirmed and substantially consummated. The amended joint Chapter 11 plan became effective Nov. 7, according to a court filing that fixed Jan. 13 as the professional fee bar date and Dec. 7 as the bar for administrative claims. SPIRE CORP: Maturity of Silicon Valley Facility Moved to Aug. 30 ---------------------------------------------------------------- Spire Corporation and Silicon Valley Bank entered into (i) the Fifth Loan Modification Agreement amending certain terms of the Second Amended and Restated Loan and Security Agreement dated as of Nov. 16, 2009, and (ii) the Fifth Loan Modification Agreement amending certain terms of the Amended and Restated Export-Import Bank Loan and Security Agreement dated as of Nov. 16, 2009. Pursuant to the terms of the Fifth Loan Modification Agreements, the Company and the Bank agreed to (i) extend the maturity date of the Revolving Credit Facility and the Ex-Im Facility to Aug. 30, 2013, and (ii) effective June 1, 2013, amend the definition of the Financial Covenant by deleting the minimum cash covenant and replacing it with a newly defined covenant whereby the Company will maintain liquidity of at least $1.25 million at all times based on cash on hand and availability under the credit facility. About Spire Corp Bedford, Massachusetts-based Spire Corporation currently develops, manufactures and markets customized turn-key solutions for the solar industry, including individual pieces of manufacturing equipment and full turn-key lines for cell and module production and testing. McGladrey LLP, in Boston, Massachusetts, expressed substantial doubt about Spire Corporation's ability to continue as a going concern. The independent auditors noted that during the year ended Dec. 31, 2012, the Company incurred a loss from continuing operations of $4.8 million and continuing operating cash flows used $6.9 million in cash. In addition, the independent auditors noted that the Company's credit agreements are due to expire on June 29, 2013. The Company reported a net loss of $1.9 million on total net sales and revenues of $22.1 million in 2012, compared with a net loss of $1.5 million on total net sales of $58.7 million in 2011. The Company's balance sheet at March 31, 2013, showed $15.06 million in total assets, $9.88 million in total liabilities and $5.18 million in total stockholders' equity. STEBNER REAL ESTATE: Court Dismisses Chapter 11 Case ---------------------------------------------------- The U.S. Bankruptcy Court has approved Stebner Real Estate, Inc.'s motion to dismiss its Chapter 11 case. The Debtor said that Chapter 11 is no longer needed. Langstan Management, LLC, has acquired the first deed of trust on the Debtor's Lincoln Street property. The Debtor has come to an agreement with creditors and the custodian/state court receiver. The obligations owed to Bayview are being serviced by the Debtor's Holley and Cornwall properties. The Debtor's assets consist of three properties: the Lincoln Street property, and the Holly Street and Cornwall Street buildings. The Holly Street and Cornwall Street buildings continue to service the underlying debt to One West Bank so those properties are not in need of reorganization in Chapter 11. The Lincoln Street property was in default. Langstan Management purchased American West Bank's first deed of trust and the Debtor has negotiated a resolution of creditors' claims that were in default including the second and third deeds of trust held by Kena Brashear and Dennis Wise. The court-appointed custodian, Marc Stern, has submitted a final report and fee application for approval and payment of administrative costs as a precondition to dismissal. The proposed order of dismissal provides for payment of all real estate taxes on the Holly and Cornwall Street Buildings as a precondition to dismissal. The custodian/receiver will enter a separate order dismissing the receivership proceeding in the Superior Court. In a filing dated March 22, 2013, the U.S. Trustee said the Debtor owes estimated quarterly fees of $1,625.82. "The actual amount of fees due cannot be determined because the required monthly financial reports, other than for February 2013, have not been filed," the U.S. Trustee stated. The U.S. Trustee demands that the missing monthly reports be filed and the quarterly fees be paid prior to any relief, but does not object to eventual dismissal of the case. About Stebner Real Estate Stebner Real Estate Inc., which is based in Scottsdale, Arizona, filed a bare-bones Chapter 11 petition (Bankr. W.D. Wash. Case No. 12-19825) in Seattle on Sept. 26, 2012. The Debtor estimated assets and debts of $10 million to $50 million. Jeffrey B. Wells, Esq., in Seattle, serves as counsel to the Debtor. Derek Stebner, the president, signed the Chapter 11 petition. Seattle-based Marc S. Stern -- marc@hutzbah.com -- of Marc S. Stern Attorney at Law, acts as pro se receiver/custodian for the Debtor. STOCKTON, CA: NPFGC Hires Weil Gotshal After Winston DQ ------------------------------------------------------- Erin Coe of BankruptcyLaw360 reported that National Public Finance Guarantee Corp. has retained Weil Gotshal & Manges LLP to represent it in the Chapter 9 bankruptcy proceedings of San Bernardino and Stockton, Calif., after a judge disqualified Winston & Strawn LLP from representing the bond insurer in the San Bernardino matter, it said Friday. According to the report, NPFG spokesman Kevin Brown said Weil Gotshal would replace Winston & Strawn in both cases. The move came in response to a June 13 decision by U.S. Bankruptcy Judge Meredith Jury granting the California Public Employees' Retirement System's motion to disqualify Winston, complaining that the firm has a conflict of interest that cannot be cured. As previously reported by The Troubled Company Reporter, CalPERS filed papers in May contending that Winston should be disqualified from continuing to represent NPFGC because the firm hired away a partner and two associates from the Charlotte, North Carolina, office of K&L Gates LLP. Those lawyers, the report relates, spent 500 hours in the San Bernardino bankruptcy working for CalPers, California's public employees' retirement fund. At a hearing June 13 in Riverside, California, U.S. Bankruptcy Judge Meredith A. Jury ruled that the hiring gave Winston has a conflict of interest that can't be solved by what's known as an ethical wall. Were the wall sufficient, Winston could continue as NPFGC's lawyers so long as the newly hired lawyers shared no information about Calpers. The report discloses that NPFGC argued unsuccessfully that the ethical wall was sufficient because it has no claims against CalPers, even though their interests admittedly were "not wholly aligned." Insurance companies like NPFGC contend that a municipality is barred from proposing a plan paying Calpers in full while forcing bondholders to sustain a loss, according to the report. About Stockton, Cal. The City of Stockton, California, filed a Chapter 9 petition (Bankr. E.D. Cal. Case No. 12-32118) in Sacramento on June 28, 2012, becoming the largest city to seek creditor protection in U.S. history. The city was forced to file for bankruptcy after talks with bondholders and labor unions failed. Stockton estimated more than $1 billion in assets and in excess of $500 million in liabilities. The city, with a population of about 300,000, identified the California Public Employees Retirement System as the largest unsecured creditor with a claim of $147.5 million for unfunded pension costs. In second place is Wells Fargo Bank NA as trustee for $124.3 million in pension obligation bonds. The list of largest creditors includes $119.2 million owing on four other series of bonds. The city is being represented by Marc A. Levinson, Esq., and John W. Killeen, Esq., at Orrick, Herrington & Sutcliffe LLP. The petition was signed by Robert Deis, city manager. Mr. Levinson also represented the city of Vallejo, Cal. in its 2008 bankruptcy. Vallejo filed for protection under Chapter 9 (Bankr. E.D. Cal. Case No. 08-26813) on May 23, 2008, estimating $500 million to $1 billion in assets and $100 million to $500 million in debts in its petition. In August 2011, Vallejo was given green light to exit the municipal reorganization. The Vallejo Chapter 9 plan restructures $50 million of publicly held debt secured by leases on public buildings. Although the Plan doesn't affect pensions, it adjusts the claims and benefits of current and former city employees. Bankruptcy Judge Michael McManus released Vallejo from bankruptcy on Nov. 1, 2011. The bankruptcy judge on April 1, 2013, ruled that the city of Stockton is eligible for municipal bankruptcy in Chapter 9. STX PAN OCEAN: Chapter 15 Case Summary -------------------------------------- Chapter 15 Debtor: STX Pan Ocean Co. Ltd. STX Namsan Tower, 5-Ga 631 Namdaemun-ro, Jung-gu Seoul, Korea Chapter 15 Case No.: 13-12046 Chapter 15 Petition Date: June 20, 2013 Court: Southern District of New York (Manhattan) Judge: Shelley C. Chapman About the Debtor: Kathryn Brenzel of BankruptcyLaw360 reported that a South Korean cargo company filed for Chapter 15 bankruptcy in New York federal court, claiming $6 billion in assets and $4.4 billion debt and seeking to extend protections from its current bankruptcy proceedings after recent detentions of its ships in the United States. According to the report, Seoul-based STX Pan Ocean Co. Ltd. is seeking protection from U.S. creditors as it sorts out recently launched reorganization proceedings in South Korea, according to court documents. STX Pan Ocean is the shipping unit of cash-strapped STX Group, South Korea's No. 13 conglomerate. The shipping and shipbuilding group has been struggling from cash shortages amid the downturn in the global industry. Chapter 15 Debtor's Counsel: Jeremy O. Harwood, Esq. BLANK ROME, LLP 405 Lexington Avenue New York, NY 10174 Tel: (212) 885-5000 Fax: (212) 885-5001 E-mail: jharwood@blankrome.com Estimated Assets: more than $1 billion Estimated Debts: more than $1 billion The petition was signed by You Sik Kim, administrator. SUNTECH POWER: European Subsidiary Granted Definitive Moratorium ---------------------------------------------------------------- Suntech Power Holdings Co., Ltd.'s principal operating subsidiary in Europe, Suntech Power International Ltd., has been granted a definitive moratorium on creditor claims from the judicial authorities in Schaffhausen, Switzerland. The moratorium is for a six month period and may be extended. Previously, on April 9, 2013, SPI had been granted a provisional moratorium for two months on creditor claims as a result of over- indebtedness. The majority of SPI's debt is Suntech inter-company debt. "SPI has already met important milestones in the restructuring process. The definitive moratorium allows SPI time to restructure debt and reach an agreement with creditors. SPI will continue normal operations during this process," said David King, Suntech's CEO. Other than the insolvency and restructuring of Suntech Holdings' Chinese subsidiary Wuxi Suntech Power Co., Ltd., and the SPI composition proceedings, Suntech Holdings is not aware of any similar proceedings regarding any of its other entities. About Suntech Wuxi, China-based Suntech Power Holdings Co., Ltd. (NYSE: STP) produces solar products for residential, commercial, industrial, and utility applications. With regional headquarters in China, Switzerland, and the United States, and gigawatt-scale manufacturing worldwide, Suntech has delivered more than 25,000,000 photovoltaic panels to over a thousand customers in more than 80 countries. As reported by the TCR on March 20, 2013, Suntech Power Holdings Co., Ltd., has received from the trustee of its 3% Convertible Notes a notice of default and acceleration relating to Suntech's non-payment of the principal amount of US$541 million that was due to holders of the Notes on March 15, 2013. That event of default has also triggered cross-defaults under Suntech's other outstanding debt, including its loans from International Finance Corporation and Chinese domestic lenders. SUN RIVER: Joe Laakman Held 16.5% Equity Stake at March 19 ---------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Joe Laakman disclosed that, as of March 19, 2013, he beneficially owned 1,533,534 shares of common stock of Sun River Energy, Inc., representing 16.525 percent of the shares outstanding. A copy of the regulatory filing is available at: http://is.gd/0K8Pri About Sun River Dallas, Tex.-based Sun River Energy, Inc., is an exploration and production company focused on oil and natural gas. Sun River has mineral interests in two major geological areas. Each area has a distinct development plan, and each area brings a different value matrix to the Company. The Company has mineral interests in the Raton Basin located in Colfax County, New Mexico, and in several counties in the highly prolific East Texas Basin. In the auditors' report accompanying the consolidated financial statements for the year ended April 30, 2012, LightfootGuestMoore&Co, P.C., in Dallas, Tex., expressed substantial doubt about Sun River's ability to continue as a going concern. The independent auditors noted that the Company has an accumulated earnings deficit of $41,027,526. The Company reported a net loss of $24.0 million on $293,000 of revenues for the year ended April 30, 2012, compared with a net loss of $7.4 million on $98,000 of revenues for the year ended April 30, 2011. Going Concern Considerations The Company has negative working capital of $13,793,000 at July 31, 2012. Approximately $10,339,000 of the negative working capital position was comprised of amounts owed to significant stockholders, including Officers of the Company. The Company is attempting to raise capital to resolve the working capital requirements and develop the oil and gas assets. The Company has multiple options available to meet the current financial obligations when due: * The Company is attempting to settlement of its $4,000,000 note payable - related party obligation with assignment of certain mineral rights that the Company was not anticipating to develop; and/or * Sun River has raised capital in a Preferred Stock offering, and the Company is currently attempting to raise additional equity through the sale of additional common stock and will utilize any proceeds to improve their working capital; and/or * The Company may sell a portion of its mineral rights to improve its working capital, in addition to other selected current liabilities of the Company which may be due. However, there can be no assurance that the Company will be able to execute any or all of the contemplated transactions, which raises substantial doubt about the Company's ability to continue as a going concern. T-L CHEROKEE: Files 100% Recovery Plan for Unsecured Creditors -------------------------------------------------------------- T-L Cherokee South, LLC, and its debtor affiliates delivered to the U.S. Bankruptcy Court for the Northern District of Indiana, Hammond Division, a plan of reorganization and accompanying disclosure statement, which proposes to distribute to holders of allowed claims funds realized from the continued operation of the Debtors' businesses, as well as from existing cash deposits and cash resources. Secured creditors will retain their prepetition and postpetition liens on the Debtors' property, and will be paid monthly interest payments at the annual interest rate of 4%. Unsecured Claims, estimated to be approximately $591,000, will recover 100% of their allowed claims. Holders of noteholder claims, estimated to be approximately $998,904, are impaired and will receive $500,000 payable from the proceeds of refinancing or sale of the Brywood Shopping Center. Holders of insider claims, estimated to be approximately $5,957,879, are impaired and will not receive any distributions under the Plan until all other classes of claims have been paid in full. No distributions will also be made to members of the Debtors. A full-text copy of the Disclosure Statement, dated June 12, 2013, is available for free at: http://bankrupt.com/misc/TLCHEROKEEds0612.pdf A conference concerning proceedings on the Debtors' Joint Disclosure Statement and Plan is scheduled for June 26, 2013, at 10:30 AM. David Welch, Esq., Arthur G. Simon, Esq., and Jeffrey C. Dan, Esq., at Crane, Heyman, Simon, Welch & Clar, in Chicago, Illinois, represent the Debtors. About T-L Cherokee T-L Conyers LLC, T-L Cherokee South, LLC, and two affiliates sought Chapter 11 protection in Hammond, Indiana, on Feb. 1, 2013. The Debtors are represented by David K. Welch, Esq., at Crane, Heyman, Simon, Welch & Clar, in Chicago. The Debtors own various shopping centers in Georgia and Kansas. T-L Cherokee South (Bankr. N.D. Ind. Case No. 13-20283) estimated assets and debts of $10,000,001 to $50,000,000. T-L Cherokee owns and operates a commercial shopping center in Overland Park, Kansas known as "Cherokee South Shopping Center". The Debtors are entities managed by Westchester, Illinois-based Tri-Land Properties, Inc., which sought Chapter 11 protection (Case No. 12-22623) on July 11, 2012. TMT USA: Seeks to Use Frozen Cash, Pay Critical Vendors ------------------------------------------------------- TMT USA Shipmanagement LLC and its affiliates, which sought bankruptcy protection following the arrest of seven of their 17 oceangoing vessels, filed a variety of first day motions, including requests to use cash collateral, pay critical vendors, pay seaman's wages and fees and penalties incurred in connection with the vessel arrests. The Debtors inform the bankruptcy court that bank lenders have frozen $54.3 million held in cash retention accounts. As a result, the Debtors have been unable to meet basic operating expenses, thus threatening the survival of the business. The bank lenders include First Commercial Bank Co. (owed $76.5 million on a first priority mortgage), Sinopac Bank (owed $67.2 million), Mega International Commercial Bank (owed $415.5 million), Cathay United Bank (owed $173.5 million) and Shanghai Bank (owed $69.7 million). The Debtors will use cash collateral in accordance with a budget, subject to a 15% variance. The Debtors intend to provide adequate protection (to the extent of any diminution in value) to the bank lenders for the use of the cash collateral by: (i) providing an existing equity cushion in the vessels; (ii) maintaining the going concern value of the collateral by using the cash collateral to continue to operate the business; (iii) granting the bank lenders postpetition replacement liens pursuant in accounts receivable; and (iv) providing a superpriority claim pursuant to 11 U.S.C. Sec. 507(b). The Debtors also seek approval to pay certain claims of maritime lien claimants that have arrested vessels, or acquired secured liens on the vessels as a result of arrest (i.e. costs of in custodia legis). The total amount of crew wages, in custodia legis fees, cargo delay fees and other expenses owed to foreign parties, giving rise to maritime liens, and preventing release of the arrested vessels is approximately $29 million The Debtors also seek to pay claims of critical vendors who supply goods, materials and services, without which the Debtors' business either could not operate or would operate at significantly reduced profitability. The Debtors estimate that the critical vendor payments will not exceed $24 million in the aggregate, which represent less than 5% of the Debtors' aggregate debt obligations. Given that the Debtors have many foreign creditors and counterparties to contracts who may not be well versed in the restrictions of the Bankruptcy Code, the Debtors seek entry of an order, pursuant to Sections 105(a), 362 and 365 of the Bankruptcy Code, enforcing and restating the automatic stay and ipso facto provisions of the Bankruptcy Code. The Debtors believe that it will take at least 60 days to complete, review, and file the schedules of assets and liabilities and the statements of financial affairs. Accordingly, the Debtors seek an extension of the 14-day deadline by 60 days. An emergency hearing on the first day motions was slated for June 24. About TMT Group Known in the industry as TMT Group, TMT USA Shipmanagement LLC and its affiliates own 17 vessels. Vessels range in size from approximately 27,000 dead weight tons (dwt) to approximately 320,000 dwt. TMT USA and 22 affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 13-33740) in Houston, Texas, on June 20, 2013. TMT has tapped attorneys from Bracewell & Giuliani LLP and AlixPartners as financial advisors. On a consolidated basis, the Debtors have $1.52 billion in assets and $1.46 billion in liabilities. TMT USA: Sues Lenders to Recover Seized Vessels ----------------------------------------------- TMT USA Shipmanagement LLC and its affiliates sought bankruptcy protection in Houston and immediately filed a lawsuit to recover six vessels arrested by various lenders at ports around the world. The arrested vessels are (i) the M/V C Whale; (ii) the M/V E Whale; (iii) the M/V Fortune Elephant; (iv) the M/V F Elephant; the M/V C Handy; (v) the M/V C Ladybug; and (vi) the M/V A Duckling. The arrests have been made on account of unpaid bank debt, unpaid vendor/crew debt, or both. The Debtors want the bankruptcy judge to issue a temporary restraining order and a permanent injunction to that would force creditors to release the vessels. The defendants include an array of international banking and shipping institutions: New York-based Capital Ship Management unit Active Tankers Shipmanagement S.A.; France-based Alstom, Inc.; BHP Billiton Marketing A.G.; China-based Cathay United Bank; Taiwan- based Chang Hwa Bank, LTD.; Hua Nan Commercial Bank, LTD.; KPI Bridge Oil Limited; Taiwan-based Mega International Commercial Bank Co., Ltd.; Taiwan-based Shanghai Commercial & Savings Bank; SDV Geis GMBH; Xiamen Hailong Manning Service Co., LTD.; China- based Zhejiang Eastern Shipyard Co., Ltd. TMT says that absent the U.S. bankruptcy court's intervention, the arrested vessels will ultimately be sold in inefficient judicial foreclosure proceedings, which will fail to maximize the value of the vessels for the benefit of the bankruptcy estates of the Debtors and all creditors. Owner of Arrested Ship Arrestor Claim Amount ---------------------- -------- ------------ C Whale Corporation KPI Bridge Oil Limited US$1,604,435 Mega International US$2,389,500 E Whale Corporation Crew individuals US$231,601 Mega International US$74,034,870 F Elephant Inc Cathay United Bank US$65,654,033 C Handy Corporation Shanghai Bank NT$497,799,678 C Ladybug Corporation Active Tanker EUR$262,500 Cathay United Bank NT2,268,788,815 SDV EUR845,000 Alstom EUR15,300,000 A Duckling Corporation Xiamen Hailong US$200,000 ZHEJIANG EASTERN US$284,528 F Elephant Co. BHP Billiton Marketing US$90,000,000 Road to Bankruptcy "The shipping industry is highly cyclical, with attendant volatility in charter hire rates and profitability. Following record charter rate levels in 2007 and 2008, charter rates in many sectors of shipping quickly plummeted to decade-low levels as a result of the global recession. In the years leading up to the global recession, TMT was in the process of initiating an expansion of its oil-bulk-ore segment, which included placing numerous orders from shipyards for newbuild vessels. Under the pressure of extremely low charter rates for its existing fleet, TMT was unable to take possession of several of its newbuild orders and simultaneously faced difficulty in servicing its debt and operating expenses. Several vessel arrests exacerbated the situation by removing income producing vessels from TMT's workforce," Lisa Donahue, managing director of AlixPartners, explains in court filings. "Realizing the need to restructure its bank debt obligations, TMT hired AlixPartners in March of 2013 with the goals of increasing efficiency for its existing business and negotiating a restructuring resolution for its existing debt. At the same time, TMT has maintained its focus on the world's increasing demand for cleaner energy by developing new technology and new plans for the transportation of liquid natural gas by tanker ship. Unfortunately, and despite the beginnings of rising charter rates, TMT's lenders and TMT were unable to come to terms despite several attempts at a consensual deal. In fact, certain lenders have continued to push for sales of TMT's arrested vessels. In order to preserve its assets and maximize value for all stakeholders, TMT has filed for chapter 11 protection." About TMT Group Known in the industry as TMT Group, TMT USA Shipmanagement LLC and its affiliates own 17 vessels. Vessels range in size from approximately 27,000 dead weight tons (dwt) to approximately 320,000 dwt. TMT USA and 22 affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 13-33740) in Houston, Texas, on June 20, 2013. TMT has tapped attorneys from Bracewell & Giuliani LLP and AlixPartners as financial advisors. On a consolidated basis, the Debtors have $1.52 billion in assets and $1.46 billion in liabilities. TOUSA INC: Liquidating Plan Set for Aug. 1 Confirmation ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Tousa Inc., a homebuilder before the assets were sold, has an Aug. 1 confirmation hearing for approval of a liquidating Chapter 11 plan ending a five-year battle among creditor groups. According to the report, the plan features recoveries ranging from 58 percent for senior noteholders to 5 percent for creditors with general unsecured claims. The impetus for settlement came in May 2012 from a decision by the U.S. Court of Appeals in Atlanta finding banks received fraudulent transfers exceeding $400 million. The opinion reinstated a ruling by U.S. Bankruptcy Judge John K. Olson which had been set aside on the first appeal in federal district court. The creditors appealed to the 11th Circuit in Atlanta and won. The appeal in the circuit court of appeals was Citicorp North America Inc. v. Official Committee of Unsecured Creditors (In re Tousa Inc.), 11-11071, 11th U.S. Circuit Court of Appeals (Atlanta). 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. Tousa and the official committee of unsecured creditors has filed a proposed chapter 11 liquidating plan following a settlement between the Debtor and creditors and other settlements crafted by mediator Peter L. Borowitz. The settlement was made after a May 2012 U.S. Court of Appeals in Atlanta decision that found that banks received fraudulent transfers exceeding $400 million. Tousa intends to have a confirmation hearing for the Plan in August. TRIAD GUARANTY: Hiring Approvals Sought --------------------------------------- BankruptcyData reported that Triad Guaranty filed with the U.S. Bankruptcy Court motions to retain: -- Womble Carlyle Sandridge & Rice (Contact: Francis A. Monaco) as counsel at the following hourly rates: attorney at $190 to 700 and paraprofessional at 65 to 295; and -- Morrison & Foerster (Contact: Anthony Princi) as special counsel at the following hourly rates: tax partner at $775 to 1,200, bankruptcy partner at 1,025, bankruptcy/insurance senior of counsel at 815, bankruptcy of counsel at 720, tax associate at 530, bankruptcy associate at 530 and paraprofessional at 280. About Triad Guaranty Winston-Salem, N.C-based Triad Guaranty Inc. (OTC BB: TGIC) -- http://www.triadguaranty.com/-- is a holding company that historically provided private mortgage insurance coverage in the United States through its wholly-owned subsidiary, Triad Guaranty Insurance Corporation. TGIC is a nationwide mortgage insurer pursuing a run-off of its existing in-force book of business. In December 2012, the Company's mortgage insurer subsidiary, Triad Guaranty Insurance Corporation, was placed into rehabilitation, whereby the Illinois Department of Insurance was vested with possession and control over all of TGIC's assets and operations. On May 30, 2013, the magistrate judge for the U.S. District Court of the Middle District of North Carolina issued an order denying the Company's motion to dismiss a class action lawsuit against the company and two of its former officers. Shareholders filed the class action suit in 2009, claiming the company misled investors about poor financial results caused by improper underwriting procedures. Triad Guaranty Inc. filed a Chapter 11 petition (Bankr. D. Del. Case No. 13-11452) on June 3, 2013. The Company estimated assets of at least $100 million and liabilities of less than $50,000. Attorneys at Womble Carlyle Sandridge & Rice, LLP, serve as counsel to the Debtor. The Debtor said in court filings that it has no significant operating activities, and has limited remaining cash and other assets on hand. The Debtor has been exploring various strategic alternatives, and will continue to do so from and after the Petition Date. The Debtor said that expenses primarily consist of legal fees, fees paid to its board, annual premiums for directors' and officers' liability insurance and general operating expenses. The expenses range from $100,000 to $500,000 per quarter. Unless the expenses are reduced, the Debtor expects to deplete all of its remaining cash by the end of 2013 or earlier. TRIAD GUARANTY: Taps Donlin Recano as Claims & Noticing Agent ------------------------------------------------------------- Triad Guaranty Inc. seeks authority from the U.S. Bankruptcy Court for the District of Delaware to employ Donlin, Recano & Company, Inc., as claims and noticing agent to be paid in accordance with the hourly rates set forth in their engagement agreement. A hearing to consider approval of the employment application will be held on July 9, 2013, at 9:30 a.m. Objections are due July 2. About Triad Guaranty Winston-Salem, N.C-based Triad Guaranty Inc. (OTC BB: TGIC) -- http://www.triadguaranty.com/-- is a holding company that historically provided private mortgage insurance coverage in the United States through its wholly-owned subsidiary, Triad Guaranty Insurance Corporation. TGIC is a nationwide mortgage insurer pursuing a run-off of its existing in-force book of business. In December 2012, the Company's mortgage insurer subsidiary, Triad Guaranty Insurance Corporation, was placed into rehabilitation, whereby the Illinois Department of Insurance was vested with possession and control over all of TGIC's assets and operations. On May 30, 2013, the magistrate judge for the U.S. District Court of the Middle District of North Carolina issued an order denying the Company's motion to dismiss a class action lawsuit against the company and two of its former officers. Shareholders filed the class action suit in 2009, claiming the company misled investors about poor financial results caused by improper underwriting procedures. Triad Guaranty Inc. filed a Chapter 11 petition (Bankr. D. Del. Case No. 13-11452) on June 3, 2013. The Company estimated assets of at least $100 million and liabilities of less than $50,000. Attorneys at Womble Carlyle Sandridge & Rice, LLP, serve as counsel to the Debtor. The Debtor said in court filings that it has no significant operating activities, and has limited remaining cash and other assets on hand. The Debtor has been exploring various strategic alternatives, and will continue to do so from and after the Petition Date. The Debtor said that expenses primarily consist of legal fees, fees paid to its board, annual premiums for directors' and officers' liability insurance and general operating expenses. The expenses range from $100,000 to $500,000 per quarter. Unless the expenses are reduced, the Debtor expects to deplete all of its remaining cash by the end of 2013 or earlier. UNI-PIXEL INC: Completes Build-Out of UniBoss Wet Lab Facility -------------------------------------------------------------- UniPixel, Inc., has completed the build-out of its newly leased 7,500 square foot office and wet lab space, bringing its Woodlands facilities to more than 20,000 square feet. The wet lab area includes a chemistry lab for ink formulations and process validation, as well as analytical tools to support both manufacturing quality control and customer support. The Company also continues to advance the manufacturing build-out of its UniBossTM pro-cap, multi-touch sensor film per two preferred pricing and capacity agreements with a major PC maker and an Ecosystem Partner announced earlier. The UniBoss manufacturing build-out includes printers and plating lines being installed at the state-of-the-art manufacturing facility within the Eastman Business Park, formerly Kodak Park, in Rochester, New York, as well as adding two additional plating lines to the company's Texas facility. The company has also updated and added equipment to its mastering lab to support higher resolution design parameters. Earlier this year, UniPixel appointed Robert Rusenko as vice president of manufacturing and Robert Berg as senior vice president of global sales -- two highly experienced and capable executives. UniPixel has since brought on additional design, sales and marketing staff to support its operational platform and global commercialization efforts, bringing its current employee count to 32. The Company plans to maintain an efficient operational structure around its UniBoss roll-to-roll flexible electronics manufacturing process. However, it expects to grow employee head count throughout the year as needed and continue to leverage resources and support from its licensees and Kodak. UniPixel attended Computex in Taipei, Taiwan, two weeks ago, where it showcased 10.1" and 13.3" UniBoss product samples and prototypes. The demonstrations and meetings generated significant interest from touch-screen customers and the touch screen supply chain. The feedback was very positive. The public can see the progress the company has made with its functional UniBoss touch panels on its Web site. While UniBoss offers linear cost scalability from pocket-size mobile devices to large desktop displays, the Company's 10.1" and 13.3" prototype form factors target the highest growth segment of the market. DisplayBank forecasts the overall touch panel market to grow at 11 percent CAGR to reach $20.0 billion by 2015, whereas the market for 10.2" to 20.0" sizes is expected to grow at more than six times that rate, at a CAGR of 71 percent to $1.9 billion. "We are laser focused on ramping manufacturing capabilities towards delivering product in Q4," noted Reed Killion, president and CEO of UniPixel. "Our working relationship with Kodak is exceptional, and the support from our PC manufacturer and Ecosystem Partner continues to be very strong. The advancement and acceptance of metal mesh as an ITO replacement is gaining momentum in the touch ecosystem. We believe our UniBoss additive manufacturing process offers a price and performance curve to the touch market that ITO and other ITO subtractive processes can't meet. The downstream supply chain qualification of partners and best practices is on track, and we are pleased with the lamination capabilities of several companies that were introduced to us by our PC and Ecosystem licensees." Legal Update In June 2013, two purported class action complaints were filed in the United States District Court, Southern District of New York and the United States District Court, Southern District of Texas against the company and its CEO, CFO, and chairman. The complaints allege the company and its officers and directors violated the federal securities laws, specifically Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, by making purportedly false and misleading statements concerning its licensing agreements and product development. The complaints seek unspecified damages on behalf of a purported class of purchasers of its common stock during the period from Dec. 7, 2012, to May 31, 2013. UniPixel believes the complaints are without merit and it will vigorously defend against them. The Company has directors' and officers' and corporate liability insurance to cover risks associated with securities claims filed against the company or its directors and officers, and has notified its insurers of the complaints. The company received a ruling in its favor regarding procedure and jurisdiction in conjunction with its legal case against Conductive Inkjet Technologies (CIT). On April 29, 2013, Judge Sim Lake of the Southern District of Texas returned Uni-Pixel's U.S. case against CIT for breach of contract and a declaratory judgment to Texas State Court in Montgomery County. CIT had sought to remove the case to Federal Court. The Federal Court, however, found that CIT had agreed to have the case heard in State Court. On May 24, 2013, the company filed a motion for summary judgment with the State Court on its claim that CIT breached an agreement with the company by filing suit in the UK rather than Texas State Court. The motion is currently pending. The company maintains that this case is meritless and will defend against it vigorously. About Uni-Pixel Inc. The Woodlands, Tex.-based Uni-Pixel, Inc. (OTC BB: UNXL) -- http://www.unipixel.com/-- is a production stage company delivering its Clearly Superior(TM) Performance Engineered Films to the Lighting & Display, Solar and Flexible Electronics market segments. Uni-Pixel incurred a net loss of $9.01 million in 2012, as compared with a net loss of $8.56 million in 2011. The Company's balance sheet at March 31, 2013, showed $19.40 million in total assets, $693,193 in total liabilities and $18.71 million in total shareholders' equity. "As of December 31, 2012, we had a cash balance of approximately $13.0 million and working capital of $12.8 million. We project that current cash reserves will sustain our operations through at least December 31, 2013, and we are not aware of any trends or potential events that are likely to adversely impact our short term liquidity through this term. We expect to fund our operations with our net product revenues from our commercial products, cash and cash equivalents supplemented by proceeds from equity or debt financings, and loans or collaborative agreements with corporate partners, each to the extent necessary," according to the Company's annual report for the year ended Dec. 31, 2012. VAIL LAKE: Sec. 341 Creditors' Meeting Set for July 9 ----------------------------------------------------- The U.S. Trustee will convene a meeting of creditors pursuant to 11 U.S.C. 341(a) in the Chapter 11 case of Vail Lake Resort on July 9, 2013, at 1:00 p.m. The meeting will be held at J402 W. Broadway, Emerald Plaza Building, Suite 660 (B), Hearing Room B, in San Diego, California. About Vail Lake Vail Lake Rancho California, LLC and its affiliates own the California campground Vail Lake Resort. Vail Lake is a large reservoir in western Riverside County, California, located on Temecula Creek in the Santa Margarita River watershed, approximately 15 miles east of Temecula, California. Properties cover approximately 9,000 acres and have an estimated water storage capacity of approximately 51,000 acre-feet. On Dec. 26, 2012, creditors of Vail Lake filed an involuntary Chapter 11 petition (Bankr. S.D. Cal. Case No. 12-16684) for Vail Lake. In a filing on June 6, 2013, the Debtor said it consents to the entry of an order for relief and does not contest the involuntary Chapter 11 petition. On June 5, 2013, the company sent 5 related entities -- Vail Lake USA, LLC ("VLU"), Vail Lake Village & Resort, LLC ("VLRC"), Vail Lake Groves, LLC, Agua Tibia Ranch, LLC, and Outdoor Recreational Management, LLC -- to Chapter 11 bankruptcy. The new debtors have sought and obtained an order for joint administration of their Chapter 11 cases with Vail Lake Rancho (Case No. 12-16684). The Debtors are represented by attorneys at Cooley LLP and Phillips, Haskett & Ingwalson, A.P.C. The Debtors' consolidated assets, as of May 31, 2013, total approximately $291,016,000 and liabilities total $52,796,846. VERITY CORP: Take Flight Owned 19.6% Equity Stake at May 1 ---------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Take Flight Equities, Inc., disclosed that, as of May 1, 2013, it beneficially owned 1,733,322 shares of common stock of Verity Corp. representing 19.66 percent of the shares outstanding. A copy of the regulatory filing is available at: http://is.gd/4NjCwH Sioux Falls, South Dakota-based Verity Corp., formerly AquaLiv Technologies, Inc., is the parent of Verity Farms II, Inc., Aistiva Corporation (formerly AquaLiv, Inc.). Verity Farms II is dedicated to providing consumers with safe, high-quality and nutritious food sources through sustainable crop and livestock production. Aistiva's technology alters the behavior of organisms, including plants and humans, without chemical interaction. Aistiva's platform technology influences biological processes naturally and without chemical interaction. To date, Aistiva has released products in the industries of water treatment, skincare, and agriculture. The Company's balance sheet at March 31, 2013, showed $4.7 million in total assets, $6.8 million in total liabilities, and a stockholders' deficit of $2.1 million. Bongiovanni & Associates, C.P.A.'s, in Cornelius, North Carolina, expressed substantial doubt about AquaLiv's ability to continue as a going concern following their audit of the Company's financial statements for the year ended Sept. 30, 2012. The independent auditors noted that the Company has incurred recurring losses from operations, has a liquidity problem, and requires funds for its operational activities. VHGI HOLDINGS: Obtains $65MM Replacement Financing From Al Rami --------------------------------------------------------------- Lily Group, Inc., a wholly-owned subsidiary of VHGI Holdings, Inc., on May 28, 2013, entered into a Equity Investment Agreement with Al Rami Pure LLC. Under the terms of this agreement, at closing Al Rami will lend the Company approximately $65 million. The investment will be for a maximum term of 10 years. As consideration, Al Rami will receive 45 percent of Lily Group and a lien on Lily Group's assets, together with royalties or dividends at the rate of 1.25 percent per annum. The Company has the right to buy back the equity in Lily Group at the end of any calendar year, on the basis of the fair market valuation of the outstanding. The closing of the Equity Investment Agreement is subject to a number of conditions precedent, including delivery of a letter of credit in the amount of $10.5 million, the finalization of a definitive use of proceeds and the company reaching an agreement with its current senior secured lender. The Company is actively engaged in efforts to satisfy these conditions precedent with the goal of closing the transaction as soon as practicable. However, given the number of conditions which must be satisfied, there are no assurances this transaction will be consummated. Effective May 28, 2013, Lily Group also entered into a Memorandum of Understanding with Lily Group Holdings Company, an entity owned by Mr. Risinger, the Company's chief executive officer. Pursuant to the terms of the Memorandum of Understanding, LGHC will obtain the aforementioned letter of credit and certain other personal guarantees required by the Investor to satisfy the security requirement for the loan. As consideration, Lily Group will permit LGHC to hold the net proceeds of the loan in an account of its choosing and release the funds for Lily Group's benefit in accordance with the specific use of proceeds to be agreed upon by Lily Group and the Investor. The Company previously reported that in April 2013 it entered into a similar loan agreement with Ariana Turquoise Investment AS, the closing of which was subject to the satisfaction of certain conditions precedent. Those conditions precedent were not satisfied and that agreement was not consummated. The Equity Investment Agreement represents replacement financing for the Company. About VHGI Holdings Fort Worth, Tex.-based VHGI Holdings, Inc., is a holding company with revenue streams from these business segments: (a) precious metals (b) oil and gas (c) coal and (d) medical technology. In its report on the Company's consolidated financial statements for the year ended Dec. 31, 2011, Pritchett, Siler & Hardy, P.C., in Salt Lake City, Utah, expressed substantial doubt about VHGI Holdings' ability to continue as a going concern. The independent auditors noted that the Company has incurred substantial losses and has a working capital deficit. The Company reported a net loss of $5.43 million in 2011, compared with a net loss of $1.67 million in 2010. The Company's balance sheet at Sept. 30, 2012, showed $49.07 million in total assets, $54.61 million in total liabilities and a $5.53 million total stockholders' deficit. VISTA HERMOSA: Case Summary & 3 Unsecured Creditors --------------------------------------------------- Debtor: Vista Hermosa Holdings LLC 16027 Ventura Boulevard, Suite 604 Encino, CA 91436 Bankruptcy Case No.: 13-25804 Chapter 11 Petition Date: June 17, 2013 Court: U.S. Bankruptcy Court Central District of California (Los Angeles) Judge: Peter Carroll Debtor's Counsel: Norman A. Mathews, Esq. 16027 Ventura Boulevard, Suite 604 Encino, CA 91436 Tel: (626) 378-5477 Fax: (888) 761-0946 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 three largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/cacb13-25804.pdf The petition was signed by Parmjit Daniel Singh. VISUALANT INC: Sues Ascendiant Over 1.7MM Undelivered Shares ------------------------------------------------------------ Visualant, Inc., filed a complaint against Ascendiant Capital Partners, LLC, in the Orange County Superior Court of California (Case No. 30-2013-00656770-CU-BC-CJC) for breach of contract, seeking damages, specific performance and injunctive relief against Ascendiant. The Company entered into an Option Agreement with Ascendiant dated April 26, 2013, pursuant to which the Company had the option to purchase from Ascendiant 4,000,000 shares of the company's common stock for an aggregate purchase price of $300,000. On May 31, 2013, the Company exercised its option to purchase the 4,000,000 Option Shares from Ascendiant and paid to Ascendiant the $300,000 purchase price. In its Complaint, the Company alleges that Ascendiant breached its obligations under the Option Agreement by delivering to the Company only 2,284,525 of the 4,000,000 Option Shares and failing to deliver the remaining 1,715,475 Option Shares. The Company expects to file promptly an application for a temporary restraining order and a motion for preliminary injunction with the California Superior Court, seeking a temporary restraining order and preliminary injunctive relief requiring Ascendiant to transfer the remaining 1,715,475 Option Shares to Visualant or, in the alternative, enjoining Ascendiant from transferring, selling, or otherwise encumbering the Option Shares. The Company intends to vigorously enforce any and all rights and remedies available to it with respect to the Complaint. There can be no assurance of the outcome in the litigation, including whether specific performance or injunctive relief will be granted and whether, and in what amount, the Company may recover damages. No trial date has been set. About Visualant Inc. Seattle, Wash.-based Visualant, Inc., was incorporated under the laws of the State of Nevada on Oct. 8, 1998. The Company develops low-cost, high speed, light-based security and quality control solutions for use in homeland security, anti- counterfeiting, forgery/fraud prevention, brand protection and process control applications. Visualant incurred a net loss of $2.72 million for the year ended Sept. 30, 2012, compared with a net loss of $2.39 million for the same period during the prior year. The Company's balance sheet at March 31, 2013, showed $4.14 million in total assets, $5.53 million in total liabilities, a $1.42 million total stockholders' deficit and $40,133 in noncontrolling interest. PMB Helin Donovan, LLP, in Nov. 10, 2012, issued a "going concern" qualification on the consolidated financial statements for the year ended Sept. 30, 2012. The independent auditors noted that the Company has sustained a net loss from operations and has an accumulated deficit since inception which raise substantial doubt about the Company's ability to continue as a going concern. VITERA HEALTHCARE: S&P Assigns 'B' CCR; Outlook Negative -------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Tampa, Fl.-based Vitera Healthcare Solutions LLC. The outlook is negative. S&P also assigned a 'B' issue-level rating with a recovery rating of '3' to the company's $25 million senior secured revolving credit facility and $255 million first-lien term loan. The '3' recovery rating indicates expectations for meaningful (50% to 70%) recovery of principal in the event of default. In addition, S&P assigned a 'CCC+' issue-level rating with a '6' recovery rating to the company's $85 million senior secured second-lien term loan. The '6' recovery rating indicates expectations for negligible (0% to 10%) recovery. "Our ratings on the company reflect its 'vulnerable' business risk profile and 'highly leveraged' financial risk profile under our criteria," said Standard & Poor's credit analyst Andrew Chang. "Our business risk assessment is based on the company's ongoing business transition, small scale and narrow product focus, acquisition integration risk, and the competitive landscape in the healthcare information technology (HCIT) industry. The financial risk assessment incorporates pro forma leverage in the low-6x area. The company's expansion into the community health centers (CHC) from its recent acquisition, diverse customer base, good recurring revenues, and consistently positive free operating cash flow (FOCF) are partial offsets". The negative outlook reflects Vitera's ongoing revenue declines and continued restructuring and acquisition integration risk. S&P could lower the rating over the next 12 months if the decline in revenues or bookings is greater than S&P expects, such that leverage is on a trajectory to reach 7x or covenant cushion is likely to decline to under 15%. S&P could revise the outlook to stable if the company's shift in strategy results in stable to growing revenues and consistent EBITDA margin, which would indicate to S&P that its cost cuts have not constrained its competitiveness, and the company maintains leverage in the 6x area or below. VITESSE SEMICONDUCTOR: Offering 16.3 Million Common Shares ---------------------------------------------------------- Vitesse Semiconductor Corporation announced the pricing of an underwritten public offering of 16,300,000 shares of its common stock at a price to the public of $2.15 per share. The Company has also granted to the underwriters a 30-day option to purchase, at the same price per share as the underwriters paid for the initial shares, an additional 2,420,000 shares to cover over- allotments in connection with the offering. After deducting the underwriting discount and estimated offering expenses payable by the Company, the Company expects to receive net proceeds of approximately $32.6 million, assuming no exercise of the over- allotment option. The offering is expected to close on or about June 25, 2013, subject to customary closing conditions. Needham & Company, LLC, is acting as the sole book-running manager of the offering., Craig-Hallum Capital Group LLC and Imperial Capital, LLC, are acting as co-managers. Vitesse intends to use the net proceeds from the offering for working capital and general corporate purposes. A portion of the net proceeds also may be used to repay or restructure indebtedness. About Vitesse Based in Camarillo, California, Vitesse Semiconductor Corporation (Pink Sheets: VTSS.PK) -- http://www.vitesse.com/-- designs, develops and markets a diverse portfolio of semiconductor solutions for Carrier and Enterprise networks worldwide. In October 2009, Vitesse completed a debt restructuring transaction that resulted in the conversion of 96.7% of the Company's 2024 Debentures into a combination of cash, common stock, Series B Preferred Stock and 2014 Debentures. With respect to the remaining 3.3% of the 2024 Debentures, Vitesse settled its obligations in cash. Additionally, Vitesse repaid $5.0 million of its $30.0 million Senior Term Loan, the terms of which were amended as part of the debt restructuring transactions. Vitesse incurred a net loss of $1.11 million in 2012, a net loss of $14.81 million in 2011, and a net loss of $20.05 million in 2010. The Company's balance sheet at March 31, 2013, showed $68.85 million in total assets, $80.96 million in total liabilities and a $12.10 million total stockholders' deficit. VYSTAR CORP: Matthew Clark to Serve as Consultant ------------------------------------------------- Matthew Clark, vice president of Technical Sales, transitioned to a consulting role with continuing concentration on the marketing and sales of the Company's Vytex(R) NRL products, effective June 14, 2013. Amends Form 10-K Vystar has amended its annual report on Form 10-K for the period ended Dec. 31, 2012, to provide the consolidated financial statements and related notes from the Form 10-K formatted in XBRL (eXtensible Business Reporting Language. No other changes have been made to the Form 10-K. A copy of the amended Form 10-K is available for free at http://is.gd/ZyGjw5 About Vystar Corp Duluth, Ga.-based Vystar Corporation is the creator and exclusive owner of the innovative technology to produce Vytex(R) Natural Rubber Latex. This technology reduces antigenic protein in natural rubber latex products to virtually undetectable levels in both liquid NRL and finished latex products. Vystar reported a net loss of $2.74 million on $540,168 of revenue for the year ended Dec. 31, 2012, as compared with a net loss of $3.60 million on $347,250 of revenue during the prior year. As of Dec. 31, 2012, the Company had $1.19 million in total assets, $2.94 million in total liabilities and a $1.74 million total stockholders' deficit. Habif, Arogeti & Wynne, LLP, in Atlanta, Georgia, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company's recurring losses from operations, capital deficit, and limited capital resources raise substantial doubt about its ability to continue as a going concern. Bankruptcy Warning "There can be no assurances that the Company will be able to achieve its projected level of revenue in 2013 and beyond. If the Company is unable to achieve its projected revenue and is not able to obtain alternate additional financing of equity or debt, the Company would need to significantly curtail or reorient its operations during 2013, which could have a material adverse effect on the Company's ability to achieve its business objectives and as a result may require the Company to file for bankruptcy or cease operations." VYSTAR CORP: Brio Capital Held 9.4% Equity Stake at June 18 ----------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission on June 18, 2013, Brio Capital L.P. disclosed that it beneficially owned 2,600,000 shares of common stock of Vystar Corporation representing 9.4 percent of the shares outstanding. A copy of the regulatory filing is available at http://is.gd/BYohce About Vystar Corp Duluth, Ga.-based Vystar Corporation is the creator and exclusive owner of the innovative technology to produce Vytex(R) Natural Rubber Latex. This technology reduces antigenic protein in natural rubber latex products to virtually undetectable levels in both liquid NRL and finished latex products. Vystar reported a net loss of $2.74 million on $540,168 of revenue for the year ended Dec. 31, 2012, as compared with a net loss of $3.60 million on $347,250 of revenue during the prior year. As of Dec. 31, 2012, the Company had $1.19 million in total assets, $2.94 million in total liabilities and a $1.74 million total stockholders' deficit. Habif, Arogeti & Wynne, LLP, in Atlanta, Georgia, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company's recurring losses from operations, capital deficit, and limited capital resources raise substantial doubt about its ability to continue as a going concern. Bankruptcy Warning "There can be no assurances that the Company will be able to achieve its projected level of revenue in 2013 and beyond. If the Company is unable to achieve its projected revenue and is not able to obtain alternate additional financing of equity or debt, the Company would need to significantly curtail or reorient its operations during 2013, which could have a material adverse effect on the Company's ability to achieve its business objectives and as a result may require the Company to file for bankruptcy or cease operations. " WAVE SYSTEMS: Amends 1.8 Million Shares Resale Prospectus --------------------------------------------------------- Wave Systems Corp. has amended its Form S-3 registration statement with the U.S. Securities and Exchange Commission relating the sale by Cranshire Capital Master Fund, Ltd., and Anson Investments Master Fund, LP, of up to 1,204,820 shares of Wave's Class A common stock, par value $0.01 per share, and up to 602,410 shares of Wave's Class A common stock, par value $0.01 per share, issuable upon the exercise of warrants. The Company will not receive any proceeds from the sale of these shares of Class A common stock by the selling stockholders. Wave's Class A common stock is traded on the Nasdaq Capital Market under the symbol "WAVX." The last reported sale price of the Company's Class A common stock on the Nasdaq Capital Market on June 18, 2013, was $0.43 per share. A copy of the amended prospectus is available at: http://is.gd/EMQ2R2 About Wave Systems Lee, Massachusetts-based Wave Systems Corp. (NASDAQ: WAVX) -- http://www.wave.com/-- develops, produces and markets products for hardware-based digital security, including security applications and services that are complementary to and work with the specifications of the Trusted Computing Group, an industry standards organization comprised of computer and device manufacturers, software vendors and other computing products manufacturers. KPMG LLP, in Boston Massachusetts, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that Wave Systems Corp. has suffered recurring losses from operations and has an accumulated deficit that raise substantial doubt about its ability to continue as a going concern. For the 12 months ended Dec. 31, 2012, the Company incurred a net loss of $33.96 million, as compared with a net loss of $10.79 million in 2011. The Company's balance sheet at March 31, 2013, showed $10.77 million in total assets, $22.19 million in total liabilities and a $11.42 million total stockholders' deficit. ZOGENIX INC: Stockholders Elect Two Directors --------------------------------------------- Zogenix, Inc., held its annual meeting of stockholders on June 18, 2013, at which the stockholders elected Roger L. Hawley and Erle T. Mast as directors for a three-year term to expire at the 2016 annual meeting of stockholders. The stockholders also ratified the selection of Ernst & Young LLP as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2013. About Zogenix Inc. Zogenix, Inc. (NASDAQ: ZGNX), with offices in San Diego and Emeryville, California, is a pharmaceutical company commercializing and developing products for the treatment of central nervous system disorders and pain. Zogenix incurred a net loss of $47.38 million in 2012, as compared with a net loss of $83.90 million in 2011. The Company's balance sheet at March 31, 2013, showed $65.57 million in total assets, $70.56 million in total liabilities, and a $4.99 million total stockholders' deficit. Ernst & Young LLP, in San Diego, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012, citing recurring losses from operations and lack of sufficient working capital which raise substantial doubt about the Company's ability to continue as a going concern. * Bank of Tokyo to Pay $250MM to N.Y. in Money-Laundering Case -------------------------------------------------------------- The Associated Press reported that The Bank of Tokyo Mitsubishi- UFJ Ltd. will pay $250 million to the state of New York for laundering billions of dollars in transactions that violated economic sanctions against countries including Iran, Sudan, and Myanmar, New York financial regulators said. According to the AP report, the state's Department of Financial Services said the bank agreed to the fine and a year of special monitoring for handling the 28,000 U.S. dollar transactions totaling about $100 billion through its New York operation between 2002 and 2007. BTMU employees routinely removed information from wire transfer messages that could have identified the government and business entities involved as targets of sanctions, the department said, the report related. BTMU it reported the violations to its regulators and stopped the practice in 2007, the report added. "Since 2007, BTMU has significantly improved its compliance policies and procedures," the bank said, AP cited. "BTMU is committed to conducting business with the highest levels of integrity and regulatory compliance, and to continually improving its policies and procedures." It said it will continue to cooperate with regulators, AP added. * Federal Reserve Eyes End of Bond Buying ----------------------------------------- Jon Hilsenrath and Victoria McGrane, writing for The Wall Street Journal, reported that Federal Reserve Chairman Ben Bernanke said the central bank could start winding down its $85 billion-a-month bond-buying program later this year and end it altogether by mid- 2014, setting up a high-stakes test to see if the economy and financial markets can begin to stand on their own. According to the report, financial markets -- which have been enlivened by the fuel of the Fed's easy-money policies -- didn't take the news happily. The Dow Jones Industrial Average finished on June 19 down 206.04, or 1.35%, at 15112.19. Yields on 10-year Treasury notes jumped 0.126 percentage point to 2.308%, the highest level since March 2012. The dollar strengthened. Asian markets moved lower in early trading Thursday. Behind the Fed's strategy for unwinding its bond-buying program were its optimistic new economic forecasts for next year, including a projection that the jobless rate, which was 7.6% in May, will fall to between 6.5% and 6.8% by the end of 2014, the WSJ report said. The Fed hasn't yet made a formal decision to end the bond-buying program, and Mr. Bernanke in a press conference following the Fed's two-day policy meeting emphasized that the central bank will be flexible as it assesses the economy's health, the report noted. The Fed's bond-buying programs are meant to drive down borrowing costs, push up asset prices and encourage more investment, spending and hiring in the broader economy. But Mr. Bernanke said the wind-down could begin "later this year" if growth picks up as the Fed projects, unemployment comes down, and inflation moves closer to the central bank's 2% target, the report said. If those expectations bear out, the Fed could stop buying bonds altogether by the middle of next year, when officials project unemployment to be around 7%, he said. * FTC Is Said to Plan Inquiry of Frivolous Patent Lawsuits ---------------------------------------------------------- Edward Wyatt, writing for The New York Times, reported that the chairwoman of the Federal Trade Commission is expected to recommend a sweeping investigation of "patent trolls," companies that buy large portfolios of technology patents and use them to sue software designers and makers of products like smartphones and tablet computers, people briefed on the inquiry said. According to the report, the chairwoman, Edith Ramirez, is planning to ask the full commission to approve an inquiry that will include the issuance of subpoenas to companies that are known as patent-assertion entities, or, unflatteringly, as patent trolls. The move comes after the issuance of several executive orders by President Obama directing executive agencies to take steps to "protect innovators from frivolous litigation." If approved, which is likely, the F.T.C. investigation will require patent-assertion companies to answer questions about how they conduct their operations, including whether they coordinate their lawsuits with other patent holders and if they funnel proceeds from lawsuits and patent licenses back to the original patent owner, the report said. Patent-assertion entities, also known as P.A.E.'s, typically have no operations other than collecting royalties on patents, the report related. They accounted for more than 60 percent of the roughly 4,000 patent lawsuits filed last year, up from 29 percent two years earlier. "There are companies that are engaged in spurious lawsuits, seeking settlements that are less than the cost of litigation. But not us," said Scott Burt, chief intellectual property officer at Mosaid Technologies, a Canadian company that is nonetheless considered one of the largest patent trolls, the report cited. "We are a patent-licensing company." * HSBC Unit Liability on Verdict $1.5 Billion, Lawyer Says ---------------------------------------------------------- Andrew Harris, writing for Bloomberg News, reported that the HSBC Holdings Plc unit once known as Household International Inc. is liable for about $1.5 billion in damages to shareholders who a Chicago federal court jury found in 2009 were misled by the company and three executives, a plaintiffs' attorney said. According to the report, the lawyer, Michael J. Dowd, told U.S. District Judge Ronald A. Guzman at a hearing in Chicago that an independent claims examiner reviewed and approved investor claims approaching that amount, for which the attorney seeks entry of a partial judgment. That $1.48 billion in allowed claims from about 10,000 stockholders may be augmented by pre-judgment interest in the 11- year-old lawsuit or wiped out by post-trial motions, Dowd said in an interview outside the courtroom, the report related. Still more claims remain to be resolved, he said. Noting the litigation has gone on "for years and years," Guzman said from the bench, "it's got to come to an end," the report cited. The report recalled that household stockholders sued the company in 2002, alleging the company and three executives made misleading statements about its mortgage lending practices. The lender had earlier agreed to pay $484 million in fines to settle claims lodged by more than a dozen states. Jurors in May 2009 decided the company, former Chief Executive Officer William Aldinger and two other people made recklessly misleading comments 16 times and in one instance involving Aldinger, did so knowingly, the report further recalled. The case is Lawrence E. Jaffe Pension Plan v. Household International Inc., 1:02-cv-05893, U.S. District Court, Northern District of Illinois (Chicago). * Libor Case Ensnares More Banks -------------------------------- David Enrich, writing for The Wall Street Journal, reported that employees of some of the world's largest financial institutions conspired with a former bank trader to rig benchmark interest rates, British prosecutors alleged, a sign authorities have their sights on an array of banks and brokerages. According to the report, the U.K.'s Serious Fraud Office charged former UBS AG and Citigroup Inc. trader Tom Hayes with eight counts of "conspiring to defraud" in an alleged attempt to manipulate the London interbank offered rate, or Libor. Mr. Hayes appeared in a London court Thursday, where prosecutors for the first time detailed their allegations against him, including a list of institutions whose employees Mr. Hayes allegedly conspired with. The report related that Mr. Hayes, who was charged with similar offenses by the U.S. last December, hasn't entered a plea to either country's charges. He wrote in a January text message to The Wall Street Journal that "this goes much much higher than me." The charges read in court accuse Mr. Hayes of allegedly conspiring with employees of eight banks and interdealer brokerage firms, as well as with former colleagues at UBS and Citigroup, the report said. Each of the eight charges accused Mr. Hayes of "dishonestly seeking to manipulate [Libor]. . . with the intention that the economic interests of others would be prejudiced and/or to make personal gain for themselves or another." The banks include New York-based J.P. Morgan Chase & Co.; Germany's Deutsche Bank AG; British banks HSBC Holdings PLC and Royal Bank of Scotland Group; and Dutch lender Rabobank Groep NV, the report related. Prosecutors alleged Mr. Hayes also worked with employees of ICAP PLC, Tullett Prebon PLC and R.P. Martin Holdings Ltd., which are London-based interdealer brokers that serve as middlemen between bank traders. * Virginia Lawyer Gets 15 Years for SBA Loan Fraud -------------------------------------------------- Andrew Zajac, writing for Bloomberg News, reported that a Virginia lawyer was sentenced to 15 years and eight months in prison for his role in a scheme that resulted in more than $100 million in losses on loans backed by the U.S. Small Business Administration. According to the report, Joon Park, 43, of Falls Church, was sentenced in federal court in Baltimore. He admitted that from 2003 to October 2011, he and his co-conspirators submitted SBA loan applications with fraudulent documents including counterfeit cashier's checks and falsified bank statements and tax returns, U.S. Attorney Rod Rosenstein of Maryland said in a statement. The report related that the phony paperwork was used to persuade SBA officials to approve loans under a program that requires business owners to invest specified amounts of their own money. Taxpayers, through the SBA, guaranteed 75 percent to 90 percent of each loan, with lenders on the hook for the rest, according to Rosenstein. "When borrowers and brokers submit false information and fraudulent documents, the underwriting process is defeated and the taxpayers bear the loss," Rosenstein said, the report cited. Park was the leader of the conspiracy, along with his brother, according to the statement, the report said. The scheme operated through Park's brokerage, Jade Capital & Investments LLC of Woodbridge, Virginia. His brother, Loren Park, is still at large and believed to be in South Korea, according to Marcia Murphy, a spokeswoman for Rosenstein. Park arranged for 124 fraudulent loans with 17 commercial lenders ranging from $100,000 to $14.5 million, according to a superseding indictment returned March 7 by a federal grand jury, the report further related. Four other participants in the scheme have already been sentenced to prison and a fifth conspirator has pleaded guilty and is awaiting sentencing, the report said. The case is U.S. v. Park, 11-cr-00600, U.S. District Court, District of Maryland (Baltimore). * Moody's Reports on Covenant Protections for Metal Miners ---------------------------------------------------------- High-yield bonds from North American base and precious metals mining companies offer investors among the strongest covenant protections compared with the other sectors in its High-Yield Covenant Database, while those from steel companies offer among the weakest, Moody's Investors Service says in a new report. Bonds from the coal sector fall somewhere in between, but tend to be a little weaker than average, the ratings agency says in its new report, "North American Base and Precious Metals Covenants Give Investors Strong Protection." Moody's analyzed the covenant packages of 44 bond offerings from 29 metal and mining companies over a two-year period. The rating agency's database includes covenant quality scores, which range from 1.0 for bonds that offer the strongest investor protections, to 5.0 for those with the weakest. "An average score of 3.15 on our scale puts North American base and precious metals covenant packages among the strongest in our database," says Moody's Arturo Reyes, the report's author. "These bonds' covenant protections are well suited to the sector's cyclicality and exposure to various geopolitical and operational risks." Most issuers in the base and precious metals sector are relatively new issuers, coming to the market within the past two years. The coal and steel companies, on the other hand, have participated in the debt markets for far longer, and their once-favorable credit profiles have likely led to deals with less restrictive covenants. Standouts include aluminum producers Aleris International and Noranda Aluminum Acquisition, which have weaker-than-average covenant quality scores. This is most likely because private equity investors own part of both companies, mirroring what Moody's observes in other sectors. And bonds from several steel producers offer high-yield lite covenant packages, pointing to potentially lower recovery rates for bondholders. "An average covenant quality score of 4.31 puts North American steel companies near the bottom among the 49 sectors and sub- sectors in our database," Reyes says. "Of the seven steel issuers we looked at, Steel Dynamics, US Steel and AK Steel offer high- yield-lite bonds." Meanwhile, the average covenant quality score for North American coal companies was a weaker 3.94. In this case, the standouts were CONSOL Energy and James River Coal, whose strong scores make them exceptions among their peers. * Weil Gotshal Cuts 60 Associates, Reduces Pay for Some Partners ---------------------------------------------------------------- Peter Lattman, writing for The Wall Street Journal, reports that the news on Monday that Weil, Gotshal & Manges, among the nation's most prestigious and profitable law firms, was laying off a large number of lawyers and support staff while also reducing the pay of some of its partners, sent shock waves through the industry and underscored the financial difficulties facing the legal profession. According to the NY Times, Weil Gotshal laid off 60 junior lawyers, known at firms as associates, which amounts to roughly 7 percent of the firm's associates. Annual compensation will be reduced for roughly 30 of the firm's 300 partners, in many cases by hundreds of thousands of dollars. And 110 non-lawyers -- roughly half of them secretaries -- were let go. According to the NY Times, in Monday's e-mail, Weil Gotshal said it was taking the action "from a position of strength." It said that it had zero debt and a fully financed pension plan with more than $500 million in assets. It also noted that its partners did not have long-term compensation guarantees. "While we have been able to avoid these actions in the past, and it is very painful from a human perspective, the management committee believes that these actions are essential now to enable our firm to continue to excel and retain its historic profitability in the new normal," Barry M. Wolf, Weil's executive partner, wrote in the firmwide e-mail, according to the NY Times. According to the NY Times, data compiled by Bloomberg and Thomson Reuters show that in 2012, Weil Gotshal was ranked No. 1 in private equity representations globally. It ranked No. 2 in domestic mergers and acquisitions last year and has maintained that position in 2013, advising on deals like the American Airlines merger with US Airways. Still, Mr. Wolf said, there was not enough work to keep Weil Gotshal's army of lawyers sufficiently busy, according to the NY Times. The NY Times also relates that Peter Zeughauser, a law firm consultant, said that many firms were in denial about slack demand, and Weil Gotshal's cutbacks could pressure them into getting leaner. "We have been telling our clients about these economic realities for some time," Mr. Zeughauser said. "Weil is a bellwether firm, and this will be a real wake-up call." * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($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 ALLIANCE HEALTHC AIQ US 535.0 (119.7) 45.0 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 6,783.0 (1,532.3) (657.7) 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 1,693.3 (97.9) 741.2 CINCINNATI BELL CBB US 2,151.5 (727.8) (93.4) 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) DYAX CORP DYAX US 47.4 (59.8) 18.9 FAIRPOINT COMMUN FRP US 1,656.5 (360.7) 5.5 FAIRWAY GROUP HO FWM US 338.5 (1.2) 5.8 FERRELLGAS-LP FGP US 1,440.6 (29.0) 9.9 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 GIGAMON INC GIMO US 49.5 (1.7) 0.4 GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 GLOBAL BRASS & C BRSS US 576.5 (37.0) 286.9 GOLD RESERVE INC GRZ CN 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 1,618.9 (478.5) 929.3 HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8) HUGHES TELEMATIC HUTCU 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 INSY US 22.2 (63.5) (70.0) INVIVO THERAPEUT NVIV US 13.8 (14.3) (15.3) IPCS INC IPCS US 559.2 (33.0) 72.1 ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2 JUST ENERGY GROU JE US 1,528.9 (164.9) (62.3) JUST ENERGY GROU JE CN 1,528.9 (164.9) (62.3) L BRANDS INC LTD US 5,776.0 (994.0) 634.0 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 MDZ/A CN 1,418.5 (12.4) (165.9) MDC PARTNERS-A MDCA US 1,418.5 (12.4) (165.9) MEDIA GENERAL-A MEG US 734.7 (191.7) 38.1 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) 104.5 MPG OFFICE TRUST MPG US 1,450.5 (530.6) - NATIONAL CINEMED NCMI US 831.0 (308.8) 122.2 NAVISTAR INTL NAV US 8,723.0 (3,638.0) 1,562.0 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) OMTHERA PHARMACE OMTH US 18.3 (8.5) (12.0) 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) PLY GEM HOLDINGS PGEM US 881.8 (314.9) 101.4 PROTECTION ONE PONE US 562.9 (61.8) (7.6) QUALITY DISTRIBU QLTY US 510.5 (11.1) 88.5 QUINTILES TRANSN Q US 2,426.7 (1,322.3) 217.5 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 REVLON INC-A REV US 1,241.9 (655.1) 152.9 RITE AID CORP RAD US 7,078.7 (2,459.4) 1,830.8 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 VENOCO INC VQ US 704.3 (299.9) (40.5) 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) XERIUM TECHNOLOG XRM US 616.9 (26.0) 123.4 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 ***