/raid1/www/Hosts/bankrupt/TCR_Public/131107.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, November 7, 2013, Vol. 17, No. 309
Headlines
AGFEED INDUSTRIES: UST Wants Reconsideration of Bonus Approval
AGFEED INDUSTRIES: Chapter 11 Trustee Sought
ALLY FINANCIAL: Reports $91-Mil. Net Income in Third Quarter
ALTA GOLD: Receiver's Suit Against Aero-Nautical Dismissed
ALVOGEN PHARMA: Moody's CFR Unaffected Over Product Acquisition
ALVOGEN PHARMA: S&P Retains 'B-' CCR Following Increase in Loan
ALYDIAN INC: Bitcoin Miner Files for Bankruptcy Protection
AMERICAN AXLE: Fitch Rates New $200MM Unsecured Notes 'B'
AMERICAN AXLE: Moody's Rates $200MM Sr. Unsecured Notes 'B2'
AMERICAN AXLE: S&P Assigns 'B+' Rating to Proposed $200MM Notes
AMERICAN INT'L GROUP: Bank of America Investor Suit Rejected
AMTRUST FINANCIAL: FDIC Claim to Proceed to Trial on Merits
ANDERSON NEWS: Judge Opens Door For Publishers' Antitrust Claim
ARCHETYPE INC: Personalized Content Website Files Bankruptcy
ATLANTIC CLUB CASINO: Prepares Bankruptcy Filing
AVIANCA HOLDINGS: Makes a Comeback, To Trade in NYSE
AVON PRODUCTS: LT Ratings Downgraded One Level by Fitch to BB
B.R. BROOKFIELD: 7th Cir. Rules on Non-Recourse Integrity Claim
BASS PRO: Moody's Says $250MM Loan Hike is Credit Negative
BASS PRO: S&P Revises Outlook to Stable & Affirms 'BB-' CCR
BERNARD L. MADOFF: Secretary Saw "Smug" IT Guys After Meeting
BIG M: Blames Bankruptcy on Insurer's Delay in Sandy Claim
CAESARS ENTERTAINMENT: Debt-Equity Exchange May Avert Bankruptcy
CALPINE CORP: Fitch Rates $490MM Senior Secured Notes 'BB+'
CASH STORE: Provides Financial & Operations Update to Shareholders
CENGAGE LEARNING: Objections to Disclosure Statement Filed
CULLMAN REGIONAL: Moody's Affirms 'Ba1' Rating on $65MM Bonds
DEMCO INC: Court Approves Horizons Consulting as Tax Consultant
DENIS E. BERGERON: Judge Won't Appoint Ch.11 Trustee for Now
DETROIT, MI: Emergency Manager Pressed on Pension Cuts at Trial
DETROIT, MI: To Delay Plan to List Retirees in Obamacare Exchanges
DETROIT, MI: Bankruptcy Looked 'Premeditated,' Ex-Treasurer Said
DIGITAL REALTY: S&P Affirms 'BB+' Preferred Stock Rating
EARL GAUDIO: Committee May Retain Tap Rubin & Levin as Counsel
EARL GAUDIO: Sorling Northrup Approved as Panel's Special Counsel
EARL GAUDIO: Committee May Hire Evans Forehlich as Local Counsel
EARL GAUDIO: Can Employ Wermer Rogers as Accountants
EARL SIMMONS: DMX Promises to Play Nice in Bankruptcy
EFS COGEN: S&P Assigns Prelim. 'BB+' Rating on $825MM Facility
ENDO HEALTH: Moody's Affirms 'Ba3' CFR; Outlook Remains Negative
ENERGY FUTURE: Default Possible by Year-End, CreditSights Says
EVERGREEN OIL: Sues Chartis, Lloyd's Over Fire Coverage
EWGS INTERMEDIARY: Case Summary & 25 Largest Unsecured Creditors
EWGS INTERMEDIARY: Meeting to Form Creditors' Panel on Nov. 12
FAIRFAX FINANCIAL: Fitch Affirms 'BB' Rating on 5 Preferred Shares
FOREVER GREEN: Court Dismisses Involuntary Petition
FRESH & EASY: Prime Clerk Approved as Administrative Advisor
FRESH & EASY: Richards Layton Approved as Delaware Counsel
FRIENDFINDER NETWORKS: Disclosure Statement Approved
GETTY PETROLEUM: Lukoil Settlement Impacts Getty Realty Results
GOLDEN NUGGET: Moody's Ba3 Rating Unaffected by Refinancing Change
GOLDEN NUGGET: S&P Retains 'B' CCR Over Refinancing Changes
HELIA TEC: Sec. 341 Creditors' Meeting Set for Nov. 19
HOSTESS BRANDS: Kroger to Pay $2-Mil. to End Row Over Products
HOUSTON DLM: Voluntary Chapter 11 Case Summary
INT'L CHURCH OF OVERCOMERS: Voluntary Chapter 11 Case Summary
IVENS PROPERTIES: Must Confirm Plan by Jan. 31
J.C. PENNEY: Sales Improve but Worries Remain
JEFFERSON COUNTY, AL: To Sell $1.74 Billion of Sewer Debt
LEHMAN BROTHERS: Ex-Officers to Pay $9.75-Mil. to Municipalities
LEVI STRAUSS: Moody's Affirms 'B1' Rating on $300MM Notes
LIC CROWN: To Seek Confirmation of Prepack Plan on Dec. 10
LIFE CARE: Court Okays Hiring of Moore Stephens as Accountant
LINGENWOOD NORTHWEST: Voluntary Chapter 11 Case Summary
LONGVIEW POWER: James M. Grady Approved as Chief Financial Officer
METRO AFFILIATES: Case Summary & 30 Largest Unsecured Creditors
MEXIA LODGING: Voluntary Chapter 11 Case Summary
MF GLOBAL: CME Group to Expedite Customer Payments
MF GLOBAL: Trustee Can Distribute 100% of Customer Funds
MILLER HEIMAN: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
MT. LAUREL LODGING: Case Summary & 20 Largest Unsecured Creditors
NESBITT PORTLAND: Seeks Approval of $166-Mil. Sale
NEW LIFE FELLOWSHIP: Involuntary Chapter 11 Case Summary
NIRVANIX INC: Hires Arch & Beam as Financial Advisor
NIRVANIX INC: Taps Cole Schotz as Bankruptcy Counsel
NIRVANIX INC: Hires Cooley LLP as Corporate Counsel
NIRVANIX INC: Wants Schedules Filing Deadline Moved to Nov. 15
NNN 123: Sec. 341 Creditors' Meeting Set for Nov. 20
NNN 123: TIC Members Seek Case Dismissal
NNN 123: Plan and Disclosure Statement Due Feb. 6
OFP SELF STORAGE: Case Summary & 2 Largest Unsecured Creditors
OHANA GROUP: To Present Plan for Confirmation in December
OPEN TEXT: Moody's Places 'Ba1' CFR Under Review for Downgrade
ORCHARD FLOWER: Case Summary & 8 Largest Unsecured Creditors
OSX BRASIL: Said to Plan Bankruptcy Filing by Early Next Week
OVERSEAS SHIPHOLDING: Taps Gellert Scali as Litigation Counsel
PEREGRINE FINANCIAL: US Bank Can't Escape Suit Over $215MM Fraud
PHILADELPHIA ACHIEVEMENT: S&P Alters Outlook to Negative
PREMIERE ENTERPRISES: May Hire Stubbs & Perdue as Counsel
QUIGLEY COMPANY: Reorganization Plan Finally Effective
RAMS ASSOCIATES: Has Financing From ACT to Pay Off Power Supplier
RESERVOIR EXPLORATION: Seismic-Data Provider Files Bankruptcy
RESERVOIR EXPLORATION: Case Summary & 16 Unsecured Creditors
RESIDENTIAL CAPITAL: Confident Ch. 11 Exit Will Be Smooth
RG STEEL: GEM Gets Extension of Right Under HRE Access Agreement
RG STEEL: Federal Judge Dismisses Appeal of Trust Beneficiaries
REEVES DEVELOPMENT: Seeks Court Approval to Use Cash Collateral
RICHARD ALLEN: S&P Lowers Rating on 2006 Revenue Bonds to 'BB+'
RURAL/METRO CORP: Files Motion to Settle Qui Tam Civil Suit
SAKS INC: Moody's Withdraws 'Ba2' CFR Over Merger Completion
SHOTWELL LANDFILL: LSCG & Cook Seek Appointment of Ch.11 Trustee
SHOTWELL LANDFILL: Files Amended Schedules of Assets & Debts
SIMPLY WHEELZ: Seeks Bankruptcy as Hertz Talks Fail
SIMPLY WHEELZ: Case Summary & 20 Largest Unsecured Creditors
SOLOMONS ONE: Disgruntled Members Fail in Bid to Dismiss Case
SOUTH BAY LUBE: Case Closed Following Emergence from Chapter 11
SPECIALTY PRODUCTS: Ch. 11 Must Have Asbestos Claims Deadline
STOCKTON, CA: Sales Tax Plan Set to End Ch. 9; Pensions Spared
STOCKTON, CA: Tax Vote Puts City on Track for Solvency
SUNTECH POWER: To Stop Making Solar Panels
TOWNSQUARE RADIO: Moody's Rates New $145MM Sr. Notes 'B3'
TOWNSQUARE RADIO: S&P Retains 'B' Rating Following $137MM Add-On
TRIAD GUARANTY: Exclusive Plan Periods Extension Approved
TMT GROUP: Unsecured Creditors Demand End to Litigation Wave
TTM TECHNOLOGIES: S&P Assigns Prelim. 'B+' Sub. Issue Level Rating
VELTI INC: Wins Court Approval of Interim Bankruptcy Financing
VELTI INC: Case Summary & 20 Largest Unsecured Creditors
VINEYARD BANK: Calif. Court Sticks XL With $9MM Payout in D&O Case
VUZIX CORP: Gets TSX Venture Exchange Delisting Notice
WESTERN FUNDING: Section 341(a) Meeting to be Held Today
WIEN BAKERY: Calif. Appeals Court Okays Receiver's Final Report
* SAC Capital Plea Set for Nov. 8
* Wells Fargo Said to Face U.S. Mortgage-Bond Probe
* Annual Payments Not Needed For IRA Tax Benefit: 8th Circ.
* Debt Collectors Face New Rules under CFPB Proposal
* Roetzel Gets Tier 1 Best Law Firms Ranking in Bankruptcy Law
* Lawrence Gonzalez II Joins Roetzel's Creditors' Rights Group
* Recent Small-Dollar & Individual Chapter 11 Filings
*********
AGFEED INDUSTRIES: UST Wants Reconsideration of Bonus Approval
--------------------------------------------------------------
BankruptcyData reported that the U.S. Trustee assigned to the
AgFeed Industries case filed with the U.S. Bankruptcy Court a
motion for reconsideration, pursuant to Federal Rule of Bankruptcy
Procedure 9024, of the previous Court order, pursuant to Sections
105, 363(b) and 503(c) of the Bankruptcy Code: (i) authorizing the
Debtors to honor obligations in connection with certain key
executive employment and incentive agreements with Edward Pazdro
and Gerard R. Daignault, (ii) approving the Debtors' key executive
incentive plan and key manager incentive plan and (iii)
authorizing payment of earned bonus program holdbacks to certain
key executives.
The U.S. Trustee states, "After the entry of the Bonus Motion
Order, the Debtors filed a Securities and Exchange Commission
('SEC') Form 8-K dated September 5, 2013 disclosing that the SEC
on August 29, 2013 issued a 'Wells Notice' to the Debtors. The
Wells Notice states that the SEC staff has recommended an
enforcement action against the Debtors for violations of the
antifraud, reporting books and records and internal controls
provisions of the federal securities laws. The Wells Notice was
issued after the hearing on the Bonus Motion; potential conduct of
Pazdro and/or Daignault was not addressed in connection with the
Bonus Motion. With newly discovered evidence now available, the
U.S. Trustee respectfully requests that this Court reconsider and
vacate the Bonus Motion Order authorizing the payment of bonuses
to Pazdro and Daignault, and conduct a hearing at which
circumstances of potential misconduct by management seeking
bonuses can be addressed."
The Court scheduled a Nov. 21, 2013 hearing to consider this
motion.
About AgFeed Industries
AgFeed Industries, Inc., and its affiliates filed voluntary
petitions under Chapter 11 of the Bankruptcy Code (Bankr. D. Del.
Case No. 13-11761) on July 15, 2013, with a deal to sell most of
its subsidiaries to The Maschhoffs, LLC, for cash proceeds of
$79 million, absent higher and better offers. The Debtors
estimated assets of at least $100 million and debts of at least
$50 million.
Keith A. Maib signed the petition as chief restructuring officer.
Hon. Brendan Linehan Shannon presides over the case. Donald J.
Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway,
Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors
Inc. acts as the Debtors' financial advisor. The Debtors' claims
and noticing agent is BMC Group, Inc.
The U.S. Trustee has appointed a five-member official committee of
unsecured creditors to the Chapter 11 cases. The Creditors'
Committee tapped Lowenstein Sandler as lead bankruptcy counsel and
Greenberg Traurig, LLP, as co-counsel. CohnReznick LLP serves as
the Creditors' Committee's financial advisor.
A three-member official committee of equity security holders was
also appointed to the Chapter 11 cases. The Equity Committee
tapped Sugar Felsenthal Grais & Hammer LLP and Elliott Greenleaf
as co-counsel.
AGFEED INDUSTRIES: Chapter 11 Trustee Sought
--------------------------------------------
BankruptcyData reported that the U.S. Trustee assigned to the
AgFeed Industries case filed with the U.S. Bankruptcy Court a
motion for an order directing the appointment of a Chapter 11
trustee.
The U.S. Trustee asserts, "The U.S. Trustee alleges in the instant
Motion that, in fact, the conduct of current management has been
such as to require the appointment of a trustee to take over the
management of the Debtors, and that the appointment of a trustee
is therefore mandated by the Bankruptcy Code....The massive fraud
allegedly committed by Chinese management over an extended period
without detection, resulted in millions of dollars of losses to
AgFeed. The lack of oversight by U.S. management constitutes gross
mismanagement to justify the mandatory appointment of a trustee."
The Trustee continues, "The facts contained in the Starr and
Webster Declarations are undisputed. It cannot be overstated that
U.S. management's failure to disclose is at the heart of this
case. Pazdro and Daignault were all members of current management
during the relevant periods of 2011, and they were all members of
current management on the Petition Date....The appointment of a
trustee herein is mandatory."
The Court scheduled a Dec. 18, 2013 hearing to consider this
motion.
About AgFeed Industries
AgFeed Industries, Inc., and its affiliates filed voluntary
petitions under Chapter 11 of the Bankruptcy Code (Bankr. D. Del.
Case No. 13-11761) on July 15, 2013, with a deal to sell most of
its subsidiaries to The Maschhoffs, LLC, for cash proceeds of
$79 million, absent higher and better offers. The Debtors
estimated assets of at least $100 million and debts of at least
$50 million.
Keith A. Maib signed the petition as chief restructuring officer.
Hon. Brendan Linehan Shannon presides over the case. Donald J.
Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway,
Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors
Inc. acts as the Debtors' financial advisor. The Debtors' claims
and noticing agent is BMC Group, Inc.
The U.S. Trustee has appointed a five-member official committee of
unsecured creditors to the Chapter 11 cases. The Creditors'
Committee tapped Lowenstein Sandler as lead bankruptcy counsel and
Greenberg Traurig, LLP, as co-counsel. CohnReznick LLP serves as
the Creditors' Committee's financial advisor.
A three-member official committee of equity security holders was
also appointed to the Chapter 11 cases. The Equity Committee
tapped Sugar Felsenthal Grais & Hammer LLP and Elliott Greenleaf
as co-counsel.
ALLY FINANCIAL: Reports $91-Mil. Net Income in Third Quarter
------------------------------------------------------------
Ally Financial Inc. on Nov. 5 reported net income of $91 million
for the third quarter of 2013, compared to a net loss of $927
million in the prior quarter and net income of $384 million for
the third quarter of 2012. The company reported core pre-tax
income of $269 million in the third quarter of 2013, compared to
core pre-tax income of $201 million in the prior quarter and core
pre-tax income of $373 million in the comparable prior year
period. Excluding repositioning items related to exiting all non-
strategic mortgage-related activities, the company reported core
pre-tax income of $271 million for the quarter. Core pre-tax
income/loss reflects income from continuing operations before
taxes and original issue discount (OID) amortization expense
primarily from bond exchanges.
Net income from continuing operations for the quarter was driven
by significant improvement to Ally's cost of funds, excluding OID,
which declined 57 basis points year-over-year as the company
continues to grow deposits and execute its liability management
strategy. Overall, the company's net financing revenue, excluding
OID, continued to significantly improve, up 46 percent compared to
the prior year period. Ally's core auto finance operations
continued to post strong results with U.S. auto earning assets
growing 8 percent year-over-year. Year-over-year results were
impacted by expected, lower income from mortgage operations, as a
result of the company exiting all non-strategic mortgage-related
activities last quarter, as well as a charge to discontinued
operations as a result of the recent settlements with the Federal
Housing Finance Agency (FHFA) and the Federal Deposit Insurance
Corporation (FDIC) for all pending litigation and related claims.
"This past quarter demonstrated continued strong performance in
Ally's dealer financial services operations and steady deposit
growth from Ally Bank," said Chief Executive Officer Michael A.
Carpenter. "Our cost of funds has improved substantially due to
the liability management strategy currently underway, and Ally's
overall financial profile continues to improve as our strategic
transformation nears completion."
Mr. Carpenter continued, "During the third quarter, we announced a
private placement of $1 billion of Ally common equity, which is a
key step in our plans to normalize our capital structure and
monetize the U.S. Treasury's investment. Upon completion of this
transaction, which is subject to certain conditions, more than
two-thirds of the investment that the U.S. Treasury made into Ally
will have been paid.
"Looking ahead, we are focused on continuing to improve
profitability, exiting the U.S. Treasury's ownership and advancing
our leading dealer financial services and direct banking
franchises."
Strategic Actions Update Ally further advanced its strategic plans
through the following actions.
Private Placement and Plan to Repurchase Securities from the U.S.
Treasury On Aug. 20, Ally disclosed it had entered into agreements
with certain investors for $1 billion in private placement of
common stock, subject to certain closing conditions, including
receiving a non-objection from the Federal Reserve to the
Comprehensive Capital Analysis and Review (CCAR) resubmission
which was provided to the Federal Reserve in September. The
agreement requires the funding of the private placement to take
place no later than Nov. 30, 2013.
Concurrently, Ally entered into agreements with the U.S. Treasury
for the repurchase by Ally of all the outstanding shares of the
Mandatorily Convertible Preferred (MCP) securities held by the
U.S. Treasury and the termination of the U.S. Treasury's existing
right to acquire additional common stock in certain circumstances,
subject to a non-objection from the Federal Reserve to the CCAR
resubmission. Upon completion of the transactions, Ally will have
paid the U.S. Treasury a total of $12.3 billion.
International Businesses On Oct. 1, Ally completed the sale of its
operation in Brazil to General Motors Financial Company, Inc. (GM
Financial), a wholly-owned subsidiary of General Motors Co. Ally
received approximately $611 million in proceeds related to the
transaction. To date, Ally has received approximately $8.3
billion in proceeds from the completed sales of the international
transactions, representing approximately 90 percent of total
proceeds expected from the sale of non-U.S. businesses. The final
remaining sale transaction for the joint venture stake in China to
GM Financial remains in process.
Legacy Mortgage Issues ResCap's bankruptcy process is nearing
completion, and Ally's legacy mortgage issues have been largely
addressed. The Chapter 11 plan confirmation hearing is currently
scheduled to begin on Nov. 19, 2013, by the Honorable Judge Martin
Glenn in the U.S. Bankruptcy Court.
In October, Ally reached settlements with the FHFA and the FDIC,
as receiver for certain failed banks, for all pending litigation
and related claims. The settlements require pending litigation
against Ally to be dismissed, and the FHFA and the FDIC released
claims will no longer be exceptions to the third party releases
related to the ResCap settlement. Ally recorded a charge of $170
million to discontinued operations (or $107 million net of tax) in
the third quarter, in connection with the FHFA and the FDIC
settlements. As of Sept. 30, 2013, the company has accrued $520
million related to the settlements.
Liquidity and Capital Ally's consolidated cash and cash
equivalents declined to $6.5 billion as of Sept. 30, 2013,
compared to $7.8 billion at June 30, 2013. Included in the
Sept. 30, 2013, cash balances are $2.7 billion at Ally Bank and
$658 million at the Insurance business.
Ally's total equity was $19.1 billion at Sept. 30, 2013,
essentially flat compared to the prior quarter. The company's
preliminary third quarter 2013 Tier 1 capital ratio was unchanged
at 15.4 percent.
Funding Ally continued to execute a diverse funding strategy
during the third quarter of 2013 and completed new U.S. auto
securitizations totaling approximately $1.4 billion.
Additionally, retail deposits grew $1.8 billion in the quarter to
$41.7 billion. Total deposits now represent more than 40 percent
of Ally's funding profile. In the third quarter, the company
issued new fixed and floating rate unsecured notes totaling more
than $2.1 billion to retire legacy, high-coupon callable debt. In
total, the company called approximately $5.8 billion of debt in
the third quarter of 2013, and has called or given call notices
for an additional $1.7 billion in the weeks following quarter-end.
The company also renewed more than $5.6 billion of secured credit
facilities in the quarter. Combined, these actions continue
Ally's liability management strategy to improve the cost of funds,
excluding OID, which have declined 57 basis points year-over-year.
The company's Time to Required Funding remains strong at more than
two years as of Sept. 30, 2013. This is a liquidity measure
expressed as the number of months that the company expects to be
able to meet its ongoing liquidity needs as they arise without
issuing unsecured debt. It assumes no changes in U.S. asset
growth projections and that the auto asset-backed securities
market remains open.
Deposits The company remains focused on growing quality deposits
through its direct banking subsidiary Ally Bank. Ally Bank's
deposit growth remained strong in the third quarter with retail
deposits increasing $1.8 billion to $41.7 billion as of Sept. 30,
2013, compared to $39.9 billion at the end of the prior quarter.
Brokered deposits at Ally Bank totaled approximately $9.7 billion
as of Sept. 30, 2013. Quarterly CD retention rates remained
strong at 93 percent, marking nine consecutive quarters of rates
at 90 percent or higher. The Ally Bank franchise sustained its
momentum by steadily expanding its customer base, growing 30
percent year-over-year to approximately 754,000 customers as it
continues to attract and retain customers through Ally Bank's
enhanced consumer-centric value proposition. Ally Bank has been
recognized three years in a row as 'Best Online Bank', MONEY(R)
Magazine 2011, 2012 and 2013.
Ally Bank For purposes of quarterly financial reporting, Ally
Bank's operating results are included within Auto Finance,
Mortgage and Corporate and Other, based on its underlying business
activities. During the third quarter of 2013, Ally Bank reported
pre-tax income of $357 million, compared to $353 million in the
corresponding prior year period. Performance in the quarter
continued to be driven by improved net financing revenue as the
result of continued strength in the leasing channel.
Additionally, results were positively impacted by lower cost of
funds and reduced borrowing costs resulting from the company's
actions to retire high-cost FHLB debt in late 2012. This was
offset by lower mortgage revenue as a result of the company's
decision in the second quarter of 2013 to exit all non-strategic
mortgage-related activities. Total assets at Ally Bank were $92.1
billion at Sept. 30, compared to $92.4 billion at June 30, 2013.
Growth in leasing during the quarter was more than offset by lower
mortgage-related assets as a result of the previously noted
strategic business decisions and lower commercial automotive
balances. Approximately 65 percent of Ally's U.S. assets were
funded at Ally Bank as of Sept. 30, 2013.
Automotive Finance The Auto Finance segment includes Ally's U.S.
auto finance operations. As a result of the completed sales for
Ally Financial's international operations, including auto finance
operations in Canada, Europe and Latin America, and the remaining
sale agreement for the joint venture in China, these businesses
are classified as discontinued operations.
For the third quarter of 2013, Auto Finance reported pre-tax
income from continuing operations of $339 million, compared to
$337 million in the corresponding prior year period. The
improvement was primarily driven by strong auto net financing
revenue which improved by $72 million year-over-year, as earning
assets continued to grow and higher lease termination gains were
recorded. This was partially offset by an increase in provision
expense as the portfolio continues to shift to a more diversified
and higher margin credit mix.
U.S. consumer financing originations in the third quarter of 2013
were $9.6 billion, flat compared to the corresponding prior year
period, and were comprised of $4.2 billion of new retail, $2.6
billion of used and $2.8 billion of lease originations. U.S.
consumer financing origination levels in the third quarter of 2013
were primarily driven by strong year-over-year origination growth
in used, lease and diversified new retail channels, which grew 11
percent, 10 percent and 12 percent, respectively. Growth in these
channels mostly offset the loss of Ally's subvented originations
from Chrysler. In total, used, lease and diversified new retail
originations continued to account for more than 60 percent of
total U.S consumer originations during the third quarter of 2013.
U.S. earning assets for Auto Finance, comprised primarily of
consumer and commercial receivables, and leases, totaled $102
billion, up 8 percent compared to Sept. 30, 2012. U.S. consumer
earning assets totaled nearly $74 billion, up 13 percent year-
over-year, due to continued strong origination volume outpacing
asset run-off. U.S. commercial earning assets declined to
approximately $28 billion, down 5 percent compared to Sept. 30,
2012, as a result of lower dealer stock and intense competitive
pressures in the wholesale space, despite growth in diversified
dealer inventories.
Insurance Insurance, which focuses on dealer-centric products such
as extended vehicle service contracts (VSCs) and dealer inventory
insurance, reported pre-tax income from continuing operations of
$83 million in the third quarter of 2013, compared to $13 million
in the corresponding prior year period. Net investment income
increased to $55 million in the third quarter of 2013, compared to
a loss of $21 million in the comparable prior year period due to
higher realized investment gains and lower recognition of an other
than temporary impairment on certain investment securities.
Underwriting income declined to $28 million in the quarter,
compared to income of $34 million in the corresponding prior year
period, resulting from higher weather-related losses and lower
earned revenue due to lower written premiums in prior years when
the auto market declined during the financial crisis.
Insurance's Dealer Products and Services group experienced strong
written premiums of $267 million during the third quarter of 2013,
flat compared to the third quarter of 2012. The group continued
to grow the number of dealers participating in its full suite of
training, technology, support and consultative services, improving
participation nearly 10 percent year-over-year. Moreover, the
business maintained its high wholesale insurance penetration
levels, with approximately 82 percent of U.S. dealers with Ally
floorplan financing also carrying floorplan insurance with the
company.
Mortgage During the third quarter of 2013, Mortgage reported a
pre-tax loss of $5 million, excluding repositioning items,
compared to pre-tax income of $331 million during the third
quarter of 2012. The decrease from the prior year period was
largely due to the decision to exit all non-strategic mortgage-
related activities and cease new originations last quarter. The
remaining mortgage held-for-investment portfolio has declined to
less than $9 billion as of Sept. 30, 2013. As of June 30, the
business had no further mortgage loan originations, and as a
result of the sale of the MSR portfolio last quarter, the bank's
MSR assets are zero.
Corporate and Other Corporate and Other primarily consists of
Ally's centralized treasury activities, the residual impacts of
the company's corporate funds transfer pricing and asset liability
management activities, and the amortization of the discount
associated with new debt issuances and bond exchanges. Corporate
and Other also includes the Commercial Finance business, certain
equity investments and reclassifications, eliminations between the
reportable operating segments, and overhead previously allocated
to operations that have since been sold or discontinued.
Corporate and Other reported a core pre-tax loss (excluding core
OID amortization expense and repositioning items) of $146 million,
compared to a core pre-tax loss (excluding core OID and
repositioning items) of $301 million in the comparable prior year
period1. Results were primarily affected by lower interest
expense through the company's liability management strategy,
reduction in unsecured debt levels, refinancing other legacy debt
prior to maturity, repayment of TLGP and the early retirement of
high-cost FHLB debt that occurred in the fourth quarter of 2012.
OID amortization expense totaled $64 million in the third quarter
of 2013, compared to $76 million reported in the corresponding
prior year period.
About Ally Financial
Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/--
is one of the world's largest automotive financial services
companies. The Company offers a full suite of automotive
financing products and services in key markets around the world.
Ally's other business units include mortgage operations and
commercial finance, and the company's subsidiary, Ally Bank,
offers online retail banking products. Ally operates as a bank
holding company.
GMAC obtained a $17 billion bailout from the U.S. government in
exchange for a 56.3 percent stake. Private equity firm Cerberus
Capital Management LP keeps 14.9 percent, while General Motors Co.
owns 6.7 percent.
Ally Financial Inc. reported net income of $1.19 billion for the
year ended Dec. 31, 2012, as compared with a net loss of $157
million during the prior year. As of June 30, 2013, the Company
had $150.62 billion in total assets, $131.46 billion in total
liabilities and $19.16 billion in total equity.
ALTA GOLD: Receiver's Suit Against Aero-Nautical Dismissed
----------------------------------------------------------
District Judge Robert C. Jones in Nevada dismissed a shareholder
derivative action launched by Angelique Clark as receiver for Alta
Gold Mining Co. against Aero-Nautical Leasing Corp. et al., over
the alleged issuance of stock without adequate consideration. The
defendants sought dismissal of the suit. Judge Jones also granted,
in part, the defendants' Motion to Abstain; the counterclaims are
dismissed. A Motion for Discovery is denied as moot. Judge Jones
said Ms. Clark must seek a remedy from the state court that
appointed Bradley Swahn as custodian for Alta or from the Nevada
state court that appointed her.
The case is, ALTA GOLD MINING CO., Plaintiff, v. AERO-NAUTICAL
LEASING CORP. et al., Defendants, No. 3:13-cv-00311-RCJ-VPC (D.
Nev.). A copy of Judge Jones' Nov. 1, 2013 Order is available at
http://is.gd/YSdQ2xfrom Leagle.com.
Alta owned several mining properties in Nevada prior to filing for
Chapter 11 bankruptcy protection in U.S. Bankruptcy Court in
Nevada in 1999. The bankruptcy action was dismissed in 2000 when
Alta's counsel notified the Bankruptcy Court that Alta had ceased
operations and had no more employees, officers, or directors.
ALVOGEN PHARMA: Moody's CFR Unaffected Over Product Acquisition
---------------------------------------------------------------
Moody's Investors Service commented that Alvogen Pharma US, Inc's
proposed acquisition of two pharmaceutical products is credit
positive because it will increase EBITDA and cash flow and
immediately reduce leverage. However, leverage will likely
increase back to pre-acquisitions levels in mid-2014 when one of
the acquired products loses patent protection. As a result, there
is no change to the B3 Corporate Family Rating or the B3 rating on
the senior secured term loan.
ALVOGEN PHARMA: S&P Retains 'B-' CCR Following Increase in Loan
---------------------------------------------------------------
Standard & Poor's Ratings Services said that all of its ratings on
Pine Brook, N.J.-based Alvogen Pharma US Inc., including the 'B-'
corporate credit and term loan ratings and the '4' recovery
rating, remain unchanged following a $60 million increase in the
company's term loan to fund product acquisitions. The outlook is
stable.
The rating on Alvogen reflects its "vulnerable" business risk
profile highlighted by its very short operating history, absence
of size and scale in the very competitive generic pharmaceutical
market, a research and development group that has been structured
as a legally separate entity, and low capacity utilization in its
contract manufacturing business. S&P characterizes the company's
financial risk profile as "aggressive". Pro forma leverage is
about 3.5x and S&P expects leverage to be sustained in the 4x area
over the near term as existing products face competitive pressure.
RATINGS LIST
Alvogen Pharma US Inc.
Corporate Credit Rating B-/Stable/--
Snr Secured $285M Term Loan B-
Recovery Rating 4
ALYDIAN INC: Bitcoin Miner Files for Bankruptcy Protection
----------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that bitcoin mining company
Alydian Inc., a three-month-old startup backed by virtual currency
"incubator" CoinLab Inc., sought bankruptcy protection from
creditors without citing a reason.
According to the report, Bainbridge Island, Washington-based CLI
Holdings Inc., which does business as Alydian, listed debt of as
much as $10 million and assets of less than $50,000 in Chapter 11
documents filed Nov. 1 in U.S. Bankruptcy Court in Seattle.
CoinLab was founded by Peter J. Vessenes, also chairman of the
Bitcoin Foundation, to help nurture bitcoin companies, according
to its website. It was subpoenaed in August along with 21 other
companies as part of New York's Department of Financial Services
investigation into the virtual currency.
Bitcoins were created four years ago and can be used to buy and
sell a broad array of items, from electronics to illegal
narcotics, according to New York's top banking regulator. The
virtual currency traded at about $255 at the close of trading on
Nov. 5, according to bitcoin exchange MtGox.com.
Alydian aspired to sell equipment, which it would host and
operate, that would "mine" or harvest the virtual currency for
customers. The company began operations on Aug. 7 and was
CoinLab's first portfolio company.
The company owes about $4.1 million to its 20 largest unsecured
creditors, court papers show. XRay Holdings LLC is owed $3
million, CoinLab is owed $600,000 and Timothy C. Draper is owed
about $250,000. The company doesn't expect any funds to be
available for distribution to unsecured creditors.
The case is In re CLI Holdings Inc., 13-bk-19746, U.S. Bankruptcy
Court, Western District of Washington (Seattle).
AMERICAN AXLE: Fitch Rates New $200MM Unsecured Notes 'B'
---------------------------------------------------------
Fitch Ratings has assigned a rating of 'B/RR5' to American Axle &
Manufacturing, Inc.'s (AAM) proposed $200 million in senior
unsecured notes due 2019. AAM is the principal operating
subsidiary of American Axle & Manufacturing Holdings, Inc. (AXL).
Fitch's Issuer Default Rating (IDR) for both AXL and AAM is 'B+'
and the Rating Outlook for both is Positive.
The proposed notes will be guaranteed by AXL, as well as each of
its subsidiaries that also guarantee AAM's 6.25% senior unsecured
notes and certain future subsidiaries of the company. If the notes
are rated investment grade by certain rating agencies, AAM may
request to have the guarantees released. The company intends to
use proceeds from the new notes to redeem the remaining amount
outstanding on its 9.25% senior secured notes due 2017.
In September 2013, AAM amended its secured credit facility. As
part of the amendment, the company added a $150 million Term Loan
A to the facility, proceeds of which were used to redeem a portion
of the 9.25% secured notes. Following the redemption, as of Nov.
1, 2013, $190 million in principal amount of the 9.25% notes
remained outstanding. Proceeds from the proposed notes issuance
will allow AAM to redeem in full the remaining amount of 9.25%
secured notes, reducing the amount of secured debt in the
company's capital structure and likely reducing interest expense,
as well. After all of the 9.25% notes have been redeemed, the
company will have no significant debt maturing before September
2018, when the majority of Term Loan A comes due.
Key Rating Drivers:
The ratings and Positive Outlook for AXL and AAM continue to be
supported by Fitch's expectation that the company's credit profile
will strengthen over the intermediate term. AXL continues to
benefit from strong light truck production at General Motors
Company (GM) and Chrysler Group LLC (Chrysler), and its margins
are rising back toward recent historical levels, which were among
the strongest in the U.S. auto supply industry. Over the past 18
months, the company has dealt with several challenges, including
production inefficiencies tied to certain new-product programs, as
well as incremental costs related to the closure of two of the
company's manufacturing complexes. The recovery rating of 'RR5' on
the proposed notes reflects the substantial amount of secured debt
in the company's capital structure, which Fitch estimates would
lead to recovery prospects in the 10% to 30% range for the notes
in a distressed scenario.
In November 2013, AXL lowered its three-year backlog of new
business estimate to $1 billion from $1.25 billion. The reduction
was due to customer actions that re-timed a portion of one program
and reduced the planned requirements for another one. About two-
thirds of the remaining backlog pertains to passenger car and
crossover programs, and about two-thirds of the current estimate
relates to programs sourced from AXL's plants outside the U.S.
Overall, Fitch views this increasing diversification of AXL's book
of business as a credit positive, as it will reduce the company's
heavy exposure to U.S. light truck production and lessen its
reliance on GM for the majority of its revenue. By 2015, AXL
expects that about half of its revenue will be derived from non-GM
programs.
Despite this increasing diversification, AXL's credit profile
still faces some near-term risk from the company's very heavy
exposure to GM's light truck platform, although the company's
progress in reducing its cost base places it in a better position
today to withstand any potential future downturn. Also, with the
recent redesign of GM's full-size pickups and the upcoming
introduction of GM's redesigned full-size SUVs, demand for that
platform is likely to remain elevated over the medium term. In
addition to platform exposure, the large number of new programs
coming on-line in the near term also poses a risk to AXL's credit
profile, as it raises the potential for production issues that
could lead to temporary inefficiencies and increased costs. Fitch
notes that AXL's margins have been pressured by startup issues on
several programs over the past year.
AXL's leverage (debt/Fitch-calculated EBITDA) declined during the
12 months ended Sept. 30, 2013, to 4.2x from 4.7x in the year-
earlier period. Fitch-calculated EBITDA over the 12 months ended
Sept. 30, 2013 rose to $373 million from $336 million, while debt
was roughly flat at $1.6 billion. Fitch expects leverage to
decline further over the intermediate term as EBITDA grows on
higher business levels and somewhat stronger margins and the
company looks for opportunities to reduce its debt. Fitch expects
leverage to trend down toward the mid-3x range by year-end 2013
and potentially below 3x by the end of 2014.
Free cash flow (FCF; calculated as net cash from operations less
gross capital expenditures) in the 12 months ended Sept. 30, 2013,
was a use of $119 million, pressured by several non-recurring
items. Going forward, Fitch expects FCF to improve as new product
programs gain traction and as capital spending declines to more
typical levels. Also, following $225 million in pension
contributions in 2012, AXL is not expected to have any meaningful
required pension contributions for the next several years, which
will further bolster FCF. For 2013, above-normal capital spending
is likely to keep full-year FCF modestly negative, but Fitch
expects it to grow and turn positive in 2014 on higher production,
improved margins and lower capital spending.
Rating Sensitivities:
Positive: Future developments that may, individually or
collectively, lead to a positive rating action include:
-- Continued progress in diversifying the company's revenue base;
-- Sustained positive FCF generation;
-- A decline in leverage to the mid-3x range;
-- Sustained EBITDA margins of 12% or higher.
Negative: The current Rating Outlook is Positive. As a result,
Fitch does not currently anticipate developments with a material
likelihood, individually or collectively, leading to a rating
downgrade. However, the following developments could lead Fitch to
revise the Rating Outlook to Stable or Negative, or downgrade the
ratings:
-- Significant production inefficiencies and cash burn tied to
the start-up of new programs;
-- Lack of progress on meaningful leverage reduction;
-- A shift in management's plans to strengthen the company's
credit profile;
-- An unexpected prolonged disruption in the production of GM's
full-size pickups and SUVs.
AMERICAN AXLE: Moody's Rates $200MM Sr. Unsecured Notes 'B2'
------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to American Axle &
Manufacturing, Inc.'s $200 million offering of senior unsecured
notes. The net proceeds from the new unsecured notes are expected
to be used to redeem the remaining amounts of the company's 9.25%
Senior Secured Notes due 2017 (the senior secured notes). In a
related action Moody's affirmed the B1 Corporate Family Rating
(CFR) and B1-PD Probability of Default Rating (PDR) of American
Axle & Manufacturing Holdings, Inc. ("Holdings"), and the B2
ratings of the existing senior unsecured notes. The Speculative
Grade Liquidity Rating was affirmed at SGL-3. The rating outlook
is Stable. The rating of the $190 million (remaining amount)
senior secured guaranteed notes, at Ba1 (LGD2 11%), will be
withdrawn upon the redemption of the notes.
Ratings assigned:
American Axle & Manufacturing, Inc.
New $200 million senior unsecured notes due 2019, B2 (LGD4 63%);
Ratings affirmed:
American Axle & Manufacturing Holdings, Inc.
Corporate Family Rating, at B1;
Probability of Default Rating, at B1-PD;
Speculative Grade Liquidity Rating, at SGL-3.
American Axle & Manufacturing, Inc.
$200 million senior unsecured notes due 2019, at B2 (LGD4 63%)
$550 million senior unsecured notes due 2022, at B2 (LGD4 63%);
$400 million senior unsecured notes due 2021, at B2 (LGD4 63%);
Rating Rationale:
American Axle & Manufacturing Holdings, Inc.'s B1 Corporate Family
Rating (CFR) and stable outlook reflect the company's progress
toward attaining previously stated revenue and profitability
guidance for 2013 while maintaining a strong competitive position
as a driveline systems manufacturer. American Axle's operating
performance through the first three quarters of 2013 has
demonstrated management's commitment to achieving stronger
operating profitability after cost increases experienced in the
second half of 2012. These cost increases were related to high new
platform launches and operating inefficiencies at some individual
plants. The company has been successfully addressing both issues
and, as a result, strengthening its margins. For the three-
quarters ending September 30, 2013 American Axle's EBITA margin
(inclusive of Moody's adjustments) was approximately 7.4% compared
to about 4.6% for the last three quarters of 2012. EBITA/Interest
also improved to about 1.7x from about 1x for the respective
periods. Moody's expects American Axle's improving operating
performance, along with lower debt service costs associated with
the recent and proposed refinancing activities, to further
supporting the assigned CFR and outlook.
American Axle is anticipated to have an adequate liquidity profile
over the near-term supported by cash balances and availability
under the revolving credit facility. As of September 30, 2013,
cash on hand was $118.6 million. The company's revolving credit
facility was recently amended to increase the committed amount to
$523.5 million and extend the maturity to September 2018. As of
September 30, 2013, the revolving credit facility was unfunded
with $23.3 million outstanding letters of credit. Although the
company's operating performance and profitability are improving,
Moody's expects free cash flow will be modestly negative as a
result of higher levels of capital expenditures necessary to
support new business growth. The principal financial covenants
under the bank credit facility include a secured net debt/EBITDA
test and an EBITDA/cash interest expense test. Moody's expects the
company to have ample covenant cushion under these tests over the
near-term. The security provided to the lenders as part of the
bank credit facility limits the company's alternate sources of
liquidity.
An upward change in the outlook or rating is unlikely over the
near-term as the company manages through higher platform launch
levels. Consideration for a positive outlook or higher ratings
could arise if the company is able to sustained EBITA/Interest
coverage over 2.5x, Debt/EBITDA below 3.0, and sustained positive
free cash flow.
Downward rating migration would arise if industry conditions were
to deteriorate without sufficient offsetting restructuring actions
or savings by the company. A lower outlook or rating could result
if EBITA/Interest is maintained below 2x or if Debt/EBITDA does
not improve to below 4.5x over the coming quarters. A
deterioration in liquidity could also result in a lower rating or
outlook.
American Axle & Manufacturing, Inc., headquartered in Detroit, MI,
is a world leader in the manufacture, design, engineering and
validation of driveline systems and related components and
modules, chassis systems, and metal formed products for light
truck, SUV's and passenger cars. The company has manufacturing
locations in the USA, Mexico, the United Kingdom, Brazil, China,
Thailand, Poland, and India. The company reported revenues of $2.9
billion in 2012.
AMERICAN AXLE: S&P Assigns 'B+' Rating to Proposed $200MM Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' issue-level
rating to Detroit-based American Axle & Manufacturing Holdings
Inc.'s proposed $200 million senior unsecured notes due 2019. At
the same time, S&P assigned its recovery rating of '5' to the
notes, indicating its expectation that lenders would receive
modest recovery (10%-30%) in the event of a payment default. S&P
also raised the issue-level rating on the existing senior
unsecured notes to 'B+' from 'B' and revised the recovery rating
to '5' from '6'. Because the remaining senior secured notes will
be redeemed, the expected recovery and, therefore, the recovery
rating on the senior unsecured notes is higher. S&P do not see
the transaction as having any material impact on its credit
measures or its expectations for the existing 'BB-' corporate
credit rating.
American Axle will use the net proceeds of this $200 million
offering, which it estimates will be about $196 million, to fund
the redemption of the remaining 9.25% notes. The notes are senior
unsecured obligations of American Axle and the guarantors, ranking
equal in right of payment with the existing and future senior
unsecured debt of the issuer and guarantors. The notes will also
be effectively subordinated to all existing and future secured
debt of the company and the subsidiary guarantors to the extent of
the collateral securing the debt.
S&P's rating on American Axle reflects the company's "weak"
business risk profile, given the auto supplier industry's price
pressures and cyclicality, and "aggressive" financial risk
profile, given American Axle's elevated leverage and limited free
cash flow generation.
RATINGS LIST
American Axle & Manufacturing Holdings Inc.
Corporate Credit Rating BB-/Stable
New Ratings
American Axle & Manufacturing Holdings Inc.
$200 mil sr unsec nts due 2019 B+
Recovery Rating 5
Ratings Raised
To From
American Axle & Manufacturing Holdings Inc.
Senior unsecured B+ B
Recovery Rating 5 6
AMERICAN INT'L GROUP: Bank of America Investor Suit Rejected
------------------------------------------------------------
Christie Smythe, writing for Bloomberg News, reported that Bank of
America Corp. investors can't proceed with a lawsuit alleging they
should have been warned that American International Group Inc. was
preparing its own suit against the bank in 2011 over billions of
dollars in mortgage-backed security losses, a judge ruled.
According to the report, Bank of America "cautioned investors that
it faced substantial and rising litigation risks," U.S. District
Judge John G. Koeltl said in a ruling posted in Manhattan federal
court. The judge also found that the likelihood of AIG litigation
and its approximate cost were disclosed in the press and available
to investors even though the specifics were allegedly not in the
company's public filings.
The Charlotte, North Carolina-based bank and its officers "argue
correctly that the alleged omissions did not mislead investors
because information about BoA's exposure to MBS litigation
generally, and AIG's claim in particular, was in the public
domain," Judge Koeltl wrote.
AIG, the New York-based insurer, sued Bank of America in August
2011 over $10 billion in losses on mortgage-bond investments,
saying it was the victim of a "massive fraud," the report
recalled. The insurer said the bank and businesses it took over -
- Countrywide Financial Corp. and Merrill Lynch & Co. -- misled
AIG as they sought to profit from the bundling of mortgages into
securities.
Bank of America's stock fell 20 percent the day the AIG lawsuit
was filed, the report said.
The investors' lawsuit is In Re Bank of America AIG Disclosure
Securities Litigation, 11-cv-06678, U.S. District Court, Southern
District of New York (Manhattan).
The underlying case is American International Group Inc. (AIG) v.
Bank of America Corp. (BAC), 11-cv-06212, U.S. District Court,
Southern District of New York (Manhattan).
AMTRUST FINANCIAL: FDIC Claim to Proceed to Trial on Merits
-----------------------------------------------------------
Bankruptcy Judge Pat E. Morgenstern-Clarren in Cleveland, Ohio,
denied the request of the Federal Deposit Insurance Corporation,
as receiver of AmTrust Bank (FDIC), to strike a second amended
objection filed by AmFin Financial Corporation, fka AmTrust
Financial Corp., to the FDIC's amended proof of claim.
AmFin amended their objection in July 2013 to add this defense:
"An October 31, 2008 $40 million transaction is a fraudulent
transfer. Based on statements of counsel at oral argument, the
amendment itself does not seem to raise new factual issues. To the
extent that the FDIC feels otherwise, the debtors have offered to
extend discovery."
The FDIC argues that the debtors are prohibited from raising a new
defense in their most recent amended objection because it is past
the bar date for doing so established in the confirmed plan. The
debtors oppose the motion, denying that the plan has any such bar
date for raising this defense.
Judge Morgenstern-Clarren ruled that the Debtors' confirmed
amended plan does not provide such bar date. The claims dispute
will go forward on the merits, the judge said.
"Counsel are to confer and jointly file a report by November 13,
2013 addressing whether the discovery schedule currently in place
needs to be revised to permit the FDIC to explore the facts raised
in the amendment," the judge said.
The FDIC filed multiple proofs of claim, including a $518 million
priority claim which it has amended several times.
The case is, In re AmFin Financial Corporation Case No. 09-21323
(jointly administered).
A copy of the Court's Oct. 30, 2013 Memorandum of Opinion and
Order is available at http://is.gd/xmjnXmfrom Leagle.com.
About AmTrust Financial
AmTrust Financial Corp. was the owner of the AmTrust Bank.
AmTrust was the seventh-largest holder of deposits in South
Florida, with $4.7 billion in deposits and 21 branches.
In November 2008, the Office of Thrift Supervision issued a cease
and desist order requiring AmTrust to improve its capital ratios.
AmTrust Financial, together with affiliates that include AmTrust
Management Inc., filed for Chapter 11 bankruptcy protection
(Bankr. N.D. Ohio Case No. 09-21323) on Nov. 30, 2009. The debtor
subsidiaries include AmFin Real Estate Investments, Inc., formerly
AmTrust Real Estate Investments, Inc. (Case No. 09-21328).
G. Christopher Meyer, Esq., Christine M. Piepont, Esq., and Sherri
L. Dahl, Esq., at Squire Sanders & Dempsey (US) LLP, in Cleveland,
Ohio; and Stephen D. Lerner, Esq., at Squire Sanders & Dempsey
(US) LLP, in Cincinnati, Ohio, served as counsel to the Debtors.
Kurtzman Carson Consultants served as claims and notice agent.
Attorneys at Hahn Loeser & Parks LLP serve as counsel to the
Official Committee of Unsecured Creditors. AmTrust Management
estimated $100 million to $500 million in assets and debts in its
Chapter 11 petition.
AmTrust Bank was not part of the Chapter 11 filings. On Dec. 4,
2009, AmTrust Bank was closed by regulators and the Federal
Deposit Insurance Corporation was named receiver. New York
Community Bank, in Westbury, New York, assumed all of the deposits
of AmTrust Bank pursuant to a deal with the FDIC.
AmTrust, nka AmFin Financial Corp., obtained confirmation of its
Amended Joint Plan of Reorganization on Nov. 3, 2011. The plan
was declared effective in December 2011.
ANDERSON NEWS: Judge Opens Door For Publishers' Antitrust Claim
---------------------------------------------------------------
Law360 reported that the Delaware bankruptcy judge overseeing
Anderson News LLC's Chapter 11 opened the door for Time Inc. and
others to bring a counterclaim in the magazine wholesaler's
antitrust action against them, allowing the defendants to file
late proofs of claim and lifting the court's automatic stay.
According to the report, at a hearing in Wilmington, U.S.
Bankruptcy Judge Christopher S. Sontchi granted the requests of
Time and the other moving defendants, finding their delay in
filing proofs of claim was excusable because they had only
recently received the documents that form the basis for their
claims.
About Anderson News
Anderson News LLC was a sales and marketing company for books and
magazines. Anderson News ceased doing business in February 2009,
and was the subject of an involuntary Chapter 7 petition filed by
certain of its creditors (Bankr. D. Del. Case No. 09-10695) on
March 2, 2009. The publishing companies claimed that Anderson
News owes them a combined $37.5 million. An order for relief was
entered on Dec. 30, 2009, and the bankruptcy case was converted
from one under Chapter 7 to one under Chapter 11 on the same day.
ARCHETYPE INC: Personalized Content Website Files Bankruptcy
------------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that Archetype Inc., the
creator of a website that delivers personalized content to users
derived from their individual "personas" based on Carl Jung's
philosophy of archetypes, sought bankruptcy protection after a
fundraising effort failed.
According to the report, the New York-based company listed debt of
as much as $50 million and assets of as much as $10 million in
Chapter 11 documents filed Nov. 1 in U.S. Bankruptcy Court in
Wilmington, Delaware.
Archetype was forced to enter bankruptcy after a liquidity crisis
left it unable to and pay debt and fund operations, according to
court documents.
The company said in court papers it hasn't generated any revenue
and "was unable to obtain additional debt and equity financing,"
and therefore couldn't "service its debt, satisfy its obligations
to creditors or otherwise operate in the ordinary course of
business, necessitating the commencement of this Chapter 11
proceeding."
Archetype, which was listed as one of Time Inc.'s 10 New York
startups to watch in 2013, attempted to generate $20 million
through an equity offering earlier this year.
Cristina Carlino, the founder of Philosophy Inc., the maker of the
eponymous cosmetic products line, owns most of Archetype's equity
and debt. Carlino is also the company's executive chairman.
Carlino gained a 50 percent equity stake in the company after
contributing her "archetype"-related intellectual property
portfolio, court filings show. The company scrapped its
original website idea and introduced the current version in
September.
After the company failed to gain investor interest in its Series A
preferred stock offering, a Carlino affiliate provided Archetype
with bridge financing of about $7.3 million to maintain operations
through the end of October, court papers show. The Carlino
affiliate also owns part of the company's $19 million junior
secured notes.
Archetype plans to sell virtually all its assets to Carlino or one
of her affiliates through a court-supervised auction, according to
court documents. Carlino's affiliate would act as the "stalking-
horse," or lead bidder, offering to forgive the debt owed on the
secured bridge loan in what is known as a credit bid.
The company is seeking court approval to borrow $1.25 million from
the Carlino affiliate to help fund operations as it pursues the
sale.
The case is In re Archetype Inc., 13-bk-12874, U.S. Bankruptcy
Court, District of Delaware (Wilmington).
ATLANTIC CLUB CASINO: Prepares Bankruptcy Filing
------------------------------------------------
Patrick Fitzgerald and Peg Brickley, writing for The Wall Street
Journal, reported that Atlantic Club Casino Hotel is preparing to
file for Chapter 11 bankruptcy protection and will put the
Atlantic City business up for auction, according to sources
familiar with the matter.
The WSJ report said that Atlantic Club, which is owned by
California buyout firm Colony Capital LLC, is expected to file for
protection from creditors as early as the night of Nov. 6 in U.S.
Bankruptcy Court in Camden, N.J., sources said.
The boardwalk-based Atlantic Club is one of Atlantic City's
smallest casinos. It began life in 1980 as Golden Nugget and later
became the Atlantic Hilton before its latest name change a few
years ago.
Like the New Jersey city's other gambling venues it has suffered
continued losses in a market that is being eroded by competition
from nearby states, WSJ said.
An attempt to sell the distressed casino to the Rational Group,
which owns the PokerStars online-gambling operation, was scrapped
earlier this year, the report recalled.
The law firm of Cole Schotz is handling the casino's Chapter 11
case, sources said. The company has lined up about $15 million in
bankruptcy financing from a hedge fund, according to sources.
Under bankruptcy law, that loan could serve as a floor price for
the auction.
AVIANCA HOLDINGS: Makes a Comeback, To Trade in NYSE
----------------------------------------------------
Darcy Crowe and Sara Schaeffer Munoz, writing for The Wall Street
Journal, reported that in the past 10 years, German Efromovich has
turned Avianca Holdings SA from an airline in bankruptcy court and
beset by a drug-lord attack into one of Latin America's leading
carriers. Along the way, the one-time quail farmer converted a $64
million bet into an estimated $1.5 billion.
According to the report, the Colombian national airline caps its
comeback story with a share offering on the New York Stock
Exchange expected for Nov. 6, in a sale slated to raise about $500
million that will be used to continue expansion plans, including
the acquisition of new planes.
Today, Avianca boasts about 140 planes, a fast-growing number of
customers and flights to more than 100 cities, including Madrid
and Buenos Aires, the report related. Its turnaround follows an
investment made nine years ago by Mr. Efromovich, now the
airline's chairman, who built his fortune in the Brazilian oil
industry and heads the conglomerate Synergy Group Corp.
The listing, Mr. Efromovich told reporters recently, "will give
more visibility to the company and will make it easier to obtain
loans and financing in more favorable conditions," the report
related.
Little known outside of Latin America, Avianca is the region's
oldest airline, tracing its lineage to a precursor carrier founded
in 1920. Its fleet size is now second in the region only to Chile-
based Latam Airlines Group SA. In 2004, the carrier was in
bankruptcy court in New York. The carrier emerged from bankruptcy
the following year.
* * *
In April 2013, Standard & Poor's Rating Services assigned its 'B+'
corporate credit rating on Avianca Holdings S.A., and its 'B'
rating to Avianca's proposed senior unsecured notes due 2023. The
outlook is stable. S&P's 'B+' corporate credit rating reflects
Avianca's "weak" business risk profile, "aggressive" financial
risk profile, and "adequate" liquidity.
AVON PRODUCTS: LT Ratings Downgraded One Level by Fitch to BB
-------------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that Avon Products Inc., the
world's largest door-to-door cosmetics seller, had its ratings cut
one level to BB from BB+ by Fitch Ratings.
The downgrade "is due to deteriorating operations and intensifying
business model risk as reflected in continued double digit
declines in revenue, volume and representative counts in North
America and Asia Pacific through the first three quarters of
2013," the ratings firm said in a Nov. 4 statement.
Avon's direct-selling business model faces challenging market
conditions in Latin America, Europe, Asia and emerging markets,
Fitch said in the statement.
"The direct selling channel is growing but early indications are
that it is not as fast as other channels," and the "build-out of
alternative channels in emerging economies could have negative
implications for direct sellers," according to Fitch.
Latin America accounted for more than half of Avon's operating
profit in 2012 before other expenses. Low single-digit growth in
representatives in the region signals that the market has matured,
the ratings firm said.
Avon had more than $1.8 billion in liquidity as of Sept. 30,
according to Fitch.
B.R. BROOKFIELD: 7th Cir. Rules on Non-Recourse Integrity Claim
---------------------------------------------------------------
The United States Court of Appeals, Seventh Circuit, ruled that
ValStone Asset Management, LLC, which succeeded to the rights of a
second mortgage secured by a lien on a shopping center owned by
the debtor, B.R. Brookfield Commons No. 1, LLC and B.R. Brookfield
Commons No. 2, LLC, has a valid claim against the bankruptcy
estate.
Brookfield had argued that because the second mortgage is a
nonrecourse loan, and there was no equity in the shopping center
at the time of the bankruptcy filing, the claim on the bankrupt
estate should be disallowed. Both the bankruptcy court and the
district court held that the claim was valid. In its Nov. 4
decision available at http://is.gd/Su72j8from Leagle.com, the
Seventh Circuit agreed with the lower courts and affirmed.
Brookfield owns a commercial shopping center that serves as the
collateral for two mortgages. The first mortgage, in the amount
of approximately $8,900,000, is held by TS7-E Grantor Trust.
ValStone serves as attorney in fact for TS7-E Grantor Trust.
Integrity Development held the second mortgage in the amount of
approximately $2,539,375, but has since transferred its interest
to ValStone. ValStone now holds an interest in both the first and
second mortgage claims.
The Integrity Claim is a nonrecourse loan agreement that is
secured by a lien on the Brookfield Property. Brookfield and
ValStone do not dispute that the lien is valid and enforceable.
Outside of bankruptcy proceedings, state law would allow ValStone
to foreclose on the Brookfield Property upon Brookfield's default
on the loan. ValStone could bid on the Brookfield Property at
auction or receive proceeds from the sale of the Brookfield
Property at market value. However, since the Integrity Claim is a
nonrecourse loan, if the proceeds from the sale were not enough to
repay the first mortgage or repay the Integrity Claim in full,
ValStone would be barred from pursuing a deficiency claim for the
outstanding debt; ValStone never initiated foreclosure proceedings
under state law.
On June 10, 2011, Brookfield filed its Chapter 11 bankruptcy
petition. Unique to a Chapter 11 bankruptcy proceeding, Brookfield
is allowed to reorganize its debts and still retain ownership in
the Brookfield Property. It listed both the TS7-E Grantor Trust
first mortgage and the Integrity Claim as secured claims on
Schedule D of the bankruptcy petition. Under its reorganization
plan, Brookfield elected to retain ownership of the Brookfield
Property rather than selling it. Brookfield's election required
the bankruptcy court to establish a judicial value for the
Brookfield Property by means of independent appraisals. Though a
judicial valuation for the Brookfield Property has not yet been
established, both Brookfield and ValStone expect that the value
will be less than the amount of the first mortgage. So, absent a
significant and unexpected increase in value, the Integrity Claim,
which is second in priority, will be totally unsecured by any
equity in the Brookfield Property.
Brookfield objected to the validity of the Integrity Claim,
because it is not secured by any value in the Brookfield Property.
Brookfield argued that this totally unsecured, nonrecourse loan
should be disallowed because neither state law nor 11 U.S.C. Sec.
1111(b) allows ValStone to pursue a deficiency claim against
Brookfield.
ValStone, on the other hand, argues that 11 U.S.C. Sec.
1111(b)(1)(A) treats its nonrecourse Integrity Claim as if it had
recourse, and its unsecured deficiency claim should be allowed.
"We hold that under [Sec.] 1111(b)(1)(A), the existence of a valid
and enforceable lien is the only prerequisite for [Sec.]
1111(b)(1)(A) to apply. Regardless of whether the claim is
secured by any value in the collateral, [Sec.] 1111(b)(1)(A)
treats the nonrecourse Integrity Claim as if it had recourse
against Brookfield," the Seventh Circuit said.
B.R. Brookfield Commons No. 1, LLC, and B.R. Brookfield Commons
No. 2, LLC, based in Woodland Hills, California, filed separate
Chapter 11 bankruptcy petitions (Bankr. E.D. Wis. Case Nos.
11-29334 and 11-29336) on June 10, 2011. Judge James E. Shapiro
presides over the bankruptcy cases. Jeffrey C. Dan, Esq. --
jdan@craneheyman.com -- at Crane, Heyman, Simon, Welch & Clar,
serves as the Debtors' counsel. B.R. Brookfield Commons No. 1
scheduled assets of $9,089,559 and debts of $11,705,929.
A list of B.R. Brookfield Commons No. 1's 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/wieb11-29334.pdf
A list of B.R. Brookfield Commons No. 2's 20 largest unsecured
creditors filed together with the petition is available for free
at http://bankrupt.com/misc/wieb11-29336.pdf
The petitions were signed by Bernard Rosenson, manager.
BASS PRO: Moody's Says $250MM Loan Hike is Credit Negative
----------------------------------------------------------
Moody's Investors Service stated that Bass Pro Group, LLC's
proposed $250 million term loan increase is a near term credit
negative as it will increase leverage on a pro forma basis. The
company's ratings, including its Ba3 Corporate Family Rating, Ba3-
PD Probability of Default Rating and B1 secured term loan rating,
and stable ratings outlook are all unaffected.
Bass Pro's ratings remain unchanged and are as follows (LGD
assessment changes noted):
-- Corporate Family Rating at Ba3
-- Probability of Default Rating at Ba3-PD
-- $880 million senior secured term loan due 2019, to be upsized
by $250 million, at B1 (LGD 4, 61%) from (LGD 4, 64%)
Headquartered in Springfield, Missouri, Bass Pro Group LLC
operates "Bass Pro Shops", a retailer of outdoor recreational
products throughout the US and Canada. The company also
manufactures and sells recreational boats and related marine
products under the "Tracker", "Mako", "Tahoe" and "Nitro" brand
names. The company also owns the Big Cedar Lodge in Ridgedale,
Missouri.
BASS PRO: S&P Revises Outlook to Stable & Affirms 'BB-' CCR
-----------------------------------------------------------
Standard & Poor's Ratings Services said it revised its rating
outlook to stable from positive on Springfield, Mo.-based Bass Pro
Group LLC. At the same time, S&P affirmed all other ratings,
including the 'BB-' corporate credit rating.
"The outlook revision to stable reflects our expectation that
credit protection measures will not improve to the extent we had
previously anticipated given the incremental debt. We expect the
company to use the proceeds of the additional debt to fund new
store growth and pay a dividend," said credit analyst Kristina
Koltunicki. "We forecast that margins will continue to grow as
the company further progresses its economies of scale through
store expansion and operating efficiencies. However, additional
dividends will offset any meaningful improvement to leverage and
coverage measures."
The stable outlook incorporates S&P's expectation that revenue and
margin gains will continue over the next 12 months; however,
additional dividend distributions and store growth expansion will
limit any meaningful improvement to credit protection measures.
S&P could raise its rating if the company continues to increase
sales in the low double-digits and lower total debt to EBITDA
toward the mid-3x area. This could occur if EBITDA increases by
approximately 25% from current levels. At this time, S&P would
also need further clarity from management that financial policies
will support sustained leverage at these levels.
S&P could take a negative rating action if performance erodes
because of a moderate downturn in consumer spending or a slowdown
of new store growth. At that time, EBITDA would have declined by
about 15% from forecasted levels and credit metrics would
deteriorate such that leverage would increase to the low-5x area.
Additionally, S&P could lower the rating if the company
demonstrates more aggressive financial policies, including another
meaningful dividend payment. S&P could also lower the rating if
liquidity becomes more restricted, demonstrated by convent cushion
declining below 10%.
BERNARD L. MADOFF: Secretary Saw "Smug" IT Guys After Meeting
-------------------------------------------------------------
Erik Larson, writing for Bloomberg News, reported that two
computer programmers accused of aiding Bernard Madoff's $17
billion Ponzi scheme, and extorting the con man in the process,
were seen by his secretary looking "smug" as they left a closed-
door meeting with Madoff two years before his 2008 arrest,
prosecutors say.
According to the report, Eleanor Squillari, a receptionist and
personal secretary for Madoff from 1984 until his investment firm
closed, found the meeting with George Perez and Jerome O'Hara
noteworthy because Madoff "had a very low level of technical
sophistication" and almost always left his door open during
meetings, the U.S. said in a Nov. 1 filing in federal court in
Manhattan.
Perez and O'Hara are on trial in New York, charged with aiding
Madoff's swindle, the report related. Their lawyers asked U.S.
District Judge Laura Taylor Swain, who is overseeing the trial, to
bar Squillari from describing the men's demeanor when she
testifies, claiming it's unfair speculation. Prosecutors asked
Swain to deny the request, arguing Squillari's observations are
relevant.
The U.S. alleges that O'Hara and Perez in 2006 realized their
programming codes -- which allowed the firm's computers to "spit
out fake paperwork" -- were essential to keeping the fraud going
and demanded more money from Madoff to keep quiet, the report
said. He gave the men $100,000 each and let them name their own
annual bonuses and salary increases, prosecutors say.
Perez's lawyer, Larry Krantz, said in a Nov. 2 letter to Swain
that it would have been "impossible" for Squillari to conclude the
men felt smug "simply by observing the defendants walk silently
past her following the meeting," the report further related.
The case is U.S. v. O'Hara, 10-cr-00228, U.S. District Court,
Southern District of New York (Manhattan).
About Bernard L. Madoff
Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff
orchestrated the largest Ponzi scheme in history, with losses
topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A.
Stanton of the U.S. District Court for the Southern District of
New York granted the application of the Securities Investor
Protection Corporation for a decree adjudicating that the
customers of BLMIS are in need of the protection afforded by the
Securities Investor Protection Act of 1970. The District Court's
Protective Order (i) appointed Irving H. Picard, Esq., as trustee
for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP
as his counsel, and (iii) removed the SIPA Liquidation proceeding
to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789)
(Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims
agent.
On April 13, 2009, former BLMIS clients filed an involuntary
Chapter 7 bankruptcy petition against Bernard Madoff (Bankr.
S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. The
petitioning creditors -- Blumenthal & Associates Florida General
Partnership, Martin Rappaport Charitable Remainder Unitrust,
Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert
US$64 million in claims against Mr. Madoff based on the balances
contained in the last statements they got from BLMIS.
On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff
Securities International Limited in London under bankruptcy
protection pursuant to Chapter 15 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. 09-16751).
The Chapter 15 case was later transferred to Manhattan. In June
2009, Judge Lifland approved the consolidation of the Madoff SIPA
proceedings and the bankruptcy case.
Judge Denny Chin of the U.S. District Court for the Southern
District of New York on June 29, 2009, sentenced Mr. Madoff to
150 years of life imprisonment for defrauding investors in United
States v. Madoff, No. 09-CR-213 (S.D.N.Y.).
From recoveries in lawsuits coupled with money advanced by SIPC,
Mr. Picard has paid about 58 percent of customer claims totaling
$17.3 billion. The most recent distribution was in March 2013.
Mr. Picard has collected about $9.35 billion, not including an
additional $2.2 billion that was forfeit to the government and
likewise will go to customers. Picard is holding almost
$4.4 billion he can't distribute on account of outstanding
appeals and disputes. The largest holdback, almost $2.8 billion,
results from disputed claims.
BIG M: Blames Bankruptcy on Insurer's Delay in Sandy Claim
----------------------------------------------------------
Law360 reported that clothing retailer Big M Inc. launched an
adversary suit in New Jersey bankruptcy court on Nov. 4 alleging
Westport Insurance Co. refused to promptly reimburse it for
damages from Superstorm Sandy, resulting in losses of more than
$10 million that eventually drove the company to file for
bankruptcy and sell its assets.
According to the report, Big M alleges that Westport failed to
fully reimburse and unreasonably delayed adjusting its insurance
claim for property damage and business interruption losses
following the October 2012 superstorm.
About Big M
Totowa, New Jersey-based Big M, Inc., owner of Mandee, Annie sez,
and Afazxe Stores, filed a Chapter 11 petition (Bankr. D.N.J. Case
No. 13-10233) on Jan. 6, 2013, with Salus Capital Partners, LLC,
funding the Chapter 11 effort. Judge Donald H. Steckroth presides
over the case.
The Mandee brand is a juniors fashion retailer with 84 stores in
Illinois and along the East Coast. Annie sez is a discount
department-store retailer for women with 35 stores. Afaze is
10-store jewelry and accessory chain.
Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP, in Roseland,
serves as counsel to the Debtor. PricewaterhouseCoopers LLP has
been tapped to serve as financial advisor. GRL Capital Advisors
LLC's Glenn R. Langberg has been hired to serve as chief
restructuring officer.
Attorneys at Becker Meisel LLC serve the Debtor as conflicts
counsel.
The Debtor disclosed $21,384,430 in assets and $21,374,057 in
liabilities as of the Chapter 11 filing.
The Official Committee of Unsecured Creditors has tapped Cooley
Godward Kroish, LLP, as its counsel, and CBIZ Accounting, Tax and
Advisory of New York, LLC and CBIZ Mergers & Acquisitions Group as
its financial advisor.
As reported in the TCR on June 7, the Bankruptcy Court authorized
the Debtor to sell substantially all of its assets to YM LLC USA,
formerly known as YM Inc USA, pursuant to an asset purchase
agreement.
CAESARS ENTERTAINMENT: Debt-Equity Exchange May Avert Bankruptcy
----------------------------------------------------------------
In response to investor inquiries, Fitch Ratings is providing its
view on the potential for the cancellation of the parent
guarantees by Caesars Entertainment Corp (CEC) on certain debt at
Caesars Entertainment Operating Company (CEOC).
An exchange of the second-lien notes for CEC equity would erase
much of CEOC's cash burn and may help avert a bankruptcy. To help
execute the exchange and to help preserve CEC's equity in Caesars
Entertainment Resort Properties, LLC (CERP) and Caesars Growth
Partners (CGP), CEC may look to cancel the parent guarantee on
CEOC's debt.
Fitch believes that CEC can get rid of the guarantee although the
release would be subject to execution risk. Fitch also thinks that
CEC would weigh the cost/benefit of the release given that the
second-lien notes are already trading at around 50 cents, and
executing the guarantee release may consume considerable cash at
CEOC for either soliciting consents and/or redeeming debt.
Motivation For The Guarantee Cancelation:
CEC's assets outside CEOC include CERP and non-voting economic
stake of at least 57% in CGP. Equity value in CERP is not great
but has growth potential to the extent CERP's EBITDA grows and/or
CERP uses FCF to paydown debt. CEC's contribution to CGP was
valued at $1.3 billion.
All of CEC's equity in CERP and CGP can potentially be put at risk
should there be a restructuring at CEOC given CEC's guarantee of
CEOC's debt and the substantial negative equity at CEOC. In a
bankruptcy scenario, Fitch believes that there is minimal if any
recovery beyond the first lien.
Therefore the guarantee, if in place, is likely to be called on by
the second-lien ($5.5 billion outstanding) and unsecured ($2.4
billion with $1.1 billion held by CGP) creditors and possibly by
the first-lien creditors, to the extent the first-lien is not
fully covered by the CEOC collateral. A call on the guarantee can
consume most of or all of CEC's equity in CGP and CERP leaving the
CEC sponsors with zero value outside of the $600 million
separately invested into CGP via Caesars Acquisition Corp (CAC)
participation.
Given the status quo negative FCF situation at CEOC Fitch believes
that CEOC will be forced to restructure within two years even with
the cash sale proceeds from Macau and Planet Hollywood. There is
wide-spread speculation among the investor community that CEC may
look to execute a debt for equity exchange sometime in 2014,
principally targeting CEOC's second-lien notes (largest piece
trading at slightly below 50 cents). The interest expense
associated with CEOC's second-lien notes is around $570 million
per year, which is roughly equivalent to CEOC's Fitch estimated
cash burn in 2015 when CEOC's out-money swaps roll off. The swaps
add about $160 million to CEOC's annual interest expense in the
interim.
With the guarantee in place, the second-lien holders could argue
and use as negotiating leverage, that they are better off calling
on CEC's guarantee in a bankruptcy scenario and potentially
getting the vast majority of CEC's equity interest in CERP and CGP
as opposed to agreeing to an exchange. By removing the guarantee,
CEC weakens this leverage and likely improves execution on the
exchange.
Guarantee Mechanics:
CEC directly guarantees CEOC's $4.4 billion credit facility debt
outstanding and $1.9 billion in outstanding pre-LBO senior
unsecured notes (excluding notes coming due this December). Other
CEOC tranches including first and second lien notes and post-LBO
senior notes benefit from the parent guarantee conditioned on the
guarantee on the Credit Agreement and the Retained Notes remaining
in place.
The exact language in the indentures is 'the Parent Guarantee will
be automatically released upon the election of the Issuer and
Notice to the Trustee if the guarantee by Caesars Entertainment of
the Credit Agreement, the Retained Notes or any Indebtedness which
resulted in the obligation to guarantee the Notes has been
released or discharged.'
There is controversy as to whether the preceding sentence implies
an 'or' vs. 'and' relationship. Fitch tends to lean toward 'and'
while admitting that this issue can be argued either way. Fitch's
view is based on the Prospectus filing dated Jan. 8, 2009
accompanying the initial 2008 debt exchange that introduced
second-lien notes into CEOC's capital structure. The section in
the filing under Parent Guarantee header states that the 'Parent
Guarantee is a continuing guarantee and shall remain in full force
and effect until payment in full of all the Parent Guaranteed
Obligations.'
The Retained Notes definition refers to early maturing pre-LBO
notes, the last of which will mature in December 2013. When CEOC
issued $1.5 billion in first-lien notes in February 2013 the
Retained Notes definition in the indenture was replaced with
Existing Notes, which includes the pre-LBO notes maturing 2015-
2017 ($1.9 billion outstanding with $1.1 billion held by CGP).
CEOC subsequently entered into supplemental indentures (filed
along with the first-quarter 2013 10-Q) to revise the language in
the prior first-lien and second-lien issues to Existing Notes. (To
Fitch's best understanding there is no supplemental indenture for
the post-LBO notes with the Existing Notes language.)
Both the credit agreement and the pre-LBO senior note indentures
allow amendments with majority consent. The pre-LBO notes have a
provision (Section 12.3[c]) that permits the parent guarantee to
fallaway if CEOC is no longer a wholly-owned subsidiary of CEC.
In order to drop the guarantee on the second-lien notes CEOC will
have to get consent from the credit facility lenders, which may
require a partial repayment of the term loans outstanding. In
addition, CEOC will have to cancel the parent guarantee on the
Existing Notes, which can be accomplished by either selling a
share in CEOC to another entity or by seeking consents from the
bondholders. Of course if the 'or' is interpreted literally in the
indenture sentence discussed above then CEC needs to only drop the
guarantee from either the credit facility or the pre-LBO notes,
not both.
Getting the consents from the pre-LBO noteholders could be
complicated by the fact that $1.1 billion of these notes have been
contributed to CGP by CEC. The CGP transaction closed Oct. 21,
2013, and any material changes to the terms of these notes could
be scrutinized for questionable related party transactions by
regulators and investors at CAC.
That said, CEC pursuing the consent route is a more plausible
scenario relative to the potential redemption of the Existing
Notes, which would be prohibited under the second-lien indentures
(section 4.04[iii]). CEC may also look to preserve about $1.7
billion in liquidity at CEOC (pro forma for asset sales and net of
Fitch estimated $350 million in cage cash) for capital
improvements and contingent liquidity in the event the
transactions do not eliminate the cash burn entirely. Also CEC
needs to maintain at least $1 billion in liquidity in 2016 as a
condition to acquire CAC's stake in CGP.
The Existing Notes with face value of $1.1 billion contributed to
CGP were valued by CEC at around $775 million (68 cents) and the
notes not held by CGP can be redeemed for about $600 million based
on trading values as of Oct. 30, 2013.
Fitch currently rates CEC and its subsidiaries as follows:
Caesars Entertainment Corp.
-- Long-term IDR 'CCC'; Outlook Negative.
Caesars Entertainment Operating Co.
-- Long-term IDR 'CCC'; Outlook Negative;
-- Senior secured first-lien revolving credit facility and term
loans 'CCC+/RR3';
-- Senior secured first-lien notes 'CCC+/RR3';
-- Senior secured second-lien notes 'CC/RR6';
-- Senior unsecured notes with subsidiary guarantees 'CC/RR6';
-- Senior unsecured notes without subsidiary guarantees at
'C/RR6'.
Caesars Entertainment Resort Properties, LLC
-- Long-term IDR 'B-'; Outlook Stable;
-- Senior secured first-lien revolving credit facility and term
loans 'B+/RR2';
-- Senior secured first-lien notes 'B+/RR2';
-- Senior secured second-lien notes 'CCC/RR6';
Chester Downs and Marina LLC (and Chester Downs Finance Corp as
co-issuer)
-- Long-term IDR 'B-'; Outlook Negative;
-- Senior secured notes 'BB-/RR1'.
Corner Investment PropCo, LLC
-- Long-term IDR 'CCC';
-- Senior secured credit facility 'B-/RR2'.
CALPINE CORP: Fitch Rates $490MM Senior Secured Notes 'BB+'
-----------------------------------------------------------
Fitch Ratings has assigned a 'BB+/RR1' rating to Calpine Corp.'s
(Calpine) $490 million 5.875% senior secured notes due 2024. The
Rating Outlook is Stable. The 'RR1' rating reflects a three-notch
positive differential from the 'B+' Issuer Default Rating (IDR)
and indicates that Fitch estimates outstanding recovery of 91%-
100%.
The new senior secured notes rank equally and ratably with
Calpine's existing senior secured term loans, revolving credit
facility and first lien notes and is subordinated to all existing
and future liabilities of Calpine's subsidiaries that do not
guarantee Calpine's revolving facility, such as Calpine
Construction Finance Company, L.P. (CCFC) and other subsidiaries
that have project finance debt. The new notes are secured by a
first priority lien on substantially all of Calpine's and certain
of its guarantor's existing and future assets. Fitch estimates
that guarantor subsidiaries account for approximately 20,000 MW of
generation capacity, including projects under construction. The
same collateral secures the revolver, existing term loans and the
first lien notes.
The net proceeds from this offering, along with cash on hand, will
be used by Calpine to redeem 10% of the original aggregate
principal amount of each of the series of its existing first lien
notes, other than the recently issued 6.000% senior secured notes
due 2022, at 103% of par value. The refinancing will lower the run
rate of interest expenses.
Key Rating Drivers:
Calpine's 'B+' IDR reflects the company's relatively cleaner fuel
profile, geographic diversity, exposure to the Electricity
Reliability Council of Texas (ERCOT), and ability to sustain its
EBITDA in different natural gas price scenarios. The IDR also
reflects high consolidated gross leverage, strong liquidity
position including a growing free cash flow profile, manageable
debt maturities, and consistently demonstrated capital market
access.
Calpine's EBITDA has proved to be resilient in different natural
gas price scenarios. While its EBITDA remains biased towards
higher natural gas prices given the relative efficiency of
Calpine's fleet compared to the market, low natural gas prices
such as in 2012 boost the generation output, thus, offsetting the
compression in generation margins to a large extent. The level of
generation EBITDA stability demonstrated by Calpine over the last
four years is quite unique among the merchant power generation
companies.
Capital deployment in the already announced new generation
projects, which comprises projects under long-term contracts as
well as merchant generation in ERCOT and PJM, is expected to drive
EBITDA growth in the near term. Longer term, Calpine remains
positively leveraged to scarcity pricing reflecting demand supply
imbalances in its markets as well as to a recovery in natural gas
prices given its highly efficient fleet and natural gas being on
the margin for power prices in most of the markets it operates in.
Fitch expects Calpine's gross leverage to be approximately 6.2x in
2013 and steadily improve to 4.5x in 2017. Funds from operations
(FFO) to debt is expected to be approximately 9% in 2014 and
improve to 15%-16% in 2017. Coverage ratios remain strong over
2013-2017, consistent with Fitch's guideline metrics for a 'B+'
IDR, and could potentially improve if the company is successful in
capitalizing on the refinancing opportunities to lower its
interest costs. The forecasted net leverage metrics are even
stronger as Fitch's forecast assumes excess cash builds up on the
balance sheet. Fitch expects Calpine to hit its net debt/EBITDA
target of 4.5x in 2014 through a combination of scheduled debt
payments and growth in EBITDA. Fitch does not expect management to
proactively reduce debt from the current levels aside from the
scheduled debt maturities/amortizations.
Fitch expects Calpine to generate strong free cash flow.
Management has been increasingly focusing on growth capex and
share repurchases as its primary uses of excess cash. It is
Fitch's expectation that management continues to prudently invest
the excess cash flow proceeds in growth oriented projects and
manage its balance sheet in a conservative manner. Fitch
acknowledges the success that Calpine has had in simplifying its
capital structure, pushing out debt maturities and gaining
financial flexibility in capital allocation decisions. Calpine's
liquidity position is strong with approximately $913 million of
cash and cash equivalents, including restricted cash, and $760
million of availability under the corporate revolver, as of June
30, 2013.
Recovery Analysis:
The individual security ratings at Calpine are notched above or
below the IDR, as a result of the relative recovery prospects in a
hypothetical default scenario.
Fitch values the power generation assets that guarantee the parent
debt using a net present value (NPV) analysis. A similar NPV
analysis is used to value the generation assets that reside in
non-guarantor subs and the excess equity value is added to the
parent recovery prospects. The generation asset NPVs vary
significantly based on future gas price assumptions and other
variables, such as the discount rate and heat rate forecasts in
California, ERCOT and the Northeast. For the NPV of generation
assets used in Fitch's recovery analysis, Fitch uses the plant
valuation provided by its third-party power market consultant,
Wood Mackenzie as well as Fitch's own gas price deck and other
assumptions. The recovery analysis results in a 'RR1' rating for
the first lien debt, which reflects a three-notch positive
differential from the 'B+' IDR.
Rating Sensitivities:
Further Positive Rating Actions Unlikely: Positive rating actions
for Calpine appear unlikely unless there is material and
sustainable improvement in Calpine's credit metrics compared with
Fitch's current expectations. Management's net leverage target of
4.5x effectively caps Calpine's IDR at the 'B+' category.
Weak Wholesale Power Prices: Calpine's EBITDA is sensitive to the
level of power demand and the supply dynamics in each of the
markets it operates in. Regulatory construct and market rules can
distort pricing signals relative to the underlying power demand
and supply fundamentals. These factors could depress Calpine's
EBITDA and FFO below Fitch's expectations and, if sustained over a
period of time, could lead to negative credit actions.
Aggressive Capital Allocation Strategy: An enhanced pace of share
repurchases without hitting or sustaining the stated net leverage
targets would be a cause of concern.
Higher Business Risk: An aggressive growth strategy that diverts
significant proportion of growth capex towards merchant assets
could lead to negative rating actions. Inability to renew its
expiring long-term contracts could potentially lead to a higher
open position and elevate the business risk for Calpine.
CASH STORE: Provides Financial & Operations Update to Shareholders
------------------------------------------------------------------
Following the completion of The Cash Store Financial Services
Inc.'s 2013 fiscal year on September 30, 2013, The Cash Store
Financial Services Inc. on Nov. 5 provided a financial and
operations update to shareholders. The Company's complete audited
financial statements, including its Management Discussion and
Analysis, are expected to be released before the end of December.
"We committed to providing investors with an update on our
performance in advance of releasing our fiscal 2013 results. We
look forward to discussing this update with investors on our
conference call on November 5," said Mr. Gordon Reykdal, CEO.
Total revenue for the fourth quarter is expected to be reported at
$47.7 million in fiscal 2013 compared to $46.3 million in the
third quarter of 2013 and $50.8 million for the fourth quarter of
fiscal 2012. Loan volume was $199.8 million in the fourth quarter
of fiscal 2013, compared to $192.2 million in the third quarter of
this year and $207.2 million in the fourth quarter of fiscal 2012.
Total revenue for the year ended September 30 is expected to be
reported at $190.2 million in 2013, up from $187.4 million for
fiscal 2012. Loan volume for the year was $781.8 million in 2013,
down from $797.7 million one year earlier.
Same branch revenue for the fourth quarter, calculated on the
branches in Canada that were open for both FY2013 and FY2012, are
expected to be reported at $348,000, an increase of 4.8% over last
year.
"We have ambitious priorities for fiscal 2014," Mr. Reykdal said.
"We will continue to rollout the suite of line of credit products
that we have begun introducing to the market, look to increase our
ancillary revenue through enhanced and new product offerings,
improve the financial performance of our UK operations, reduce
corporate expenses and improve credit quality."
"We also see some very good opportunities ahead of us,"
Mr. Reykdal said. "We intend to pursue a UK growth strategy, on-
line lending in both Canada and the UK and pursue the growth of
our Title Store brand."
About Cash Store Financial
Headquartered in Edmonton, Alberta, The Cash Store Financial is
the only lender and broker of short-term advances and provider of
other financial services in Canada that is listed on the Toronto
Stock Exchange (TSX: CSF). Cash Store Financial also trades on
the New York Stock Exchange (NYSE: CSFS). Cash Store Financial
operates 512 branches across Canada under the banners "Cash Store
Financial" and "Instaloans". Cash Store Financial also operates
25 branches in the United Kingdom.
Cash Store Financial is a Canadian corporation that is not
affiliated with Cottonwood Financial Ltd. or the outlets
Cottonwood Financial Ltd. operates in the United States under the
name "Cash Store". Cash Store Financial does not do business
under the name "Cash Store" in the United States and does not own
or provide any consumer lending services in the United States.
Cash Store Financial employs approximately 1,900 associates.
The Company's balance sheet at June 30, 2013, showed $192.73
million in total assets, $171.47 million in total liabilities and
$21.25 million in shareholders' equity.
* * *
As reported in the Feb. 8, 2013 edition of the TCR, Standard &
Poor's Ratings Services lowered its issuer credit rating on Cash
Store Financial (CSF) to 'CCC+' from 'B-'. The outlook is
negative.
"The downgrades follow a proposal by the payday loan registrar in
Ontario to revoke CSF's payday lending licenses and CSF's
announcement that it has discontinued its payday loan product in
the region," said Standard & Poor's credit analyst Igor Koyfman.
The company's businesses in Ontario, which account for
approximately one-third of its store count, will begin offering a
new line of credit product to its customers. S&P believes this is
to offset the loss of its payday lending product; however, this is
a relatively new product, and S&P believes that it will be
challenging for the company to replace its lost earnings from the
payday loan product. S&P also believes that the registrar's
proposal could lead to similar actions in other territories," the
Company said.
As reported by the TCR on May 22, 2013, Moody's Investors Service
downgraded the Corporate Family Rating and senior unsecured debt
rating of Cash Store Financial Services to Caa1 from B3 and
assigned a negative outlook. According to Moody's, CSFS remains
unprofitable on both the pretax and net income lines and prospects
for return to profitability are unclear.
CENGAGE LEARNING: Objections to Disclosure Statement Filed
----------------------------------------------------------
BankruptcyData reported that multiple parties -- including Apax
Partners, Wells Fargo Bank National Association, the second lien
trustee, the U.S. Trustee assigned to the Cengage Learning case
and the official committee of unsecured creditors -- filed with
the U.S. Bankruptcy Court separate objections to Cengage
Learning's Disclosure Statement.
The U.S. Trustee states, "...the Debtors should be required to
provide the following additional information adequate to describe
the plan: the justification for the proposed non-debtor third-
party releases, exculpation provisions, limitations of liability
and injunction, including the use of negative notice consent on
the ballots; a description of the 'Management Incentive Plan' and
whether such program violates Section 503(c) of the Bankruptcy
Code and infringes upon the fiduciary duties of the New Board of
Reorganized Cengage; clarification of the Debtors' obligation to
pay United States Trustee Fees through entry of a final decree,
dismissal or conversion of each Debtor's Chapter 11 case; and a
reservation of the rights of the United States Trustee to (i)
supplement this Objection with regard to any amended or modified
Disclosure Statement and (ii) object to the Plan and raise
confirmation issues including feasibility, absolute priority and
classification pursuant to Section 1129."
The official unsecured creditors' committee explains, "The Debtors
have attempted to construct a plan based on an incomplete and
fractured foundation, without having resolved the core and
fundamental issues upon which a confirmable plan can be built.
The overarching assumption upon which the Plan is based -- that
the Holders of First Lien Claims have a valid and unavoidable
first priority lien on the total enterprise value of the Debtors,
comprised substantially of the Debtors' copyrights and their
proceeds and products (including inventory) -- has been
fundamentally undermined. In fact, the validity of the liens (if
any) on the copyrights, and the value of the copyrights, remain
entirely unresolved. Yet, the issues relating to the copyrights
go to the very heart of the value of the Debtors' businesses, the
scope of the lenders' collateral, and potential sources of
recovery for unsecured creditors. Building the Plan on a
foundation that is at a minimum in dispute and unresolved, and
from the Committee's perspective is entirely false, is a futile
exercise and a waste of estate and judicial resources."
About Cengage Learning
Stamford, Connecticut-based Cengage Learning --
http://www.cengage.com/-- provides innovative teaching, learning
and research solutions for the academic, professional and library
markets worldwide. Cengage Learning's brands include
Brooks/Cole, Course Technology, Delmar, Gale, Heinle, South
Western and Wadsworth, among others. Apax Partners LLP bought
Cengage in 2007 from Thomson Reuters Corp. in a $7.75 billion
transaction. The acquisition was funded in part with $5.6 billion
in new debt financing.
Cengage Learning Inc. filed a petition for Chapter 11
reorganization (Bankr. E.D.N.Y. Case No. 13-bk-44106) on July 2,
2013, in Brooklyn, New York, after signing an agreement where
holders of $2 billion in first-lien debt agree to support a
reorganization plan. The plan will eliminate more than $4 billion
of $5.8 billion in debt.
First-lien lenders who signed the so-called plan-support agreement
include funds affiliated with BlackRock Inc., Franklin Mutual
Adviser LLC, KKR & Co. and Oaktree Capital Management LP. Second-
lien creditors and holders of unsecured notes aren't part of the
agreement.
The Debtors have tapped Kirkland & Ellis LLP as counsel, Lazard
Freres & CO. LLC as financial advisor, Alvarez & Marsal North
America, LLC, as restructuring advisor, and Donlin, Recano &
Company, Inc., as claims and notice agent.
The Debtors filed a Joint Plan of Reorganization and Disclosure
Statement dated Oct. 3, 2013, which provides that the Debtors took
extreme care to advance and protect the interest of unsecured
creditors -- including seeking to protect four primary sources of
potential recoveries for unsecured creditors and providing them
with appropriate time to conduct diligence, and discuss their
conclusions on, among other things, the value of those sources of
potential recoveries.
CULLMAN REGIONAL: Moody's Affirms 'Ba1' Rating on $65MM Bonds
-------------------------------------------------------------
Moody's Investors Service has affirmed the Ba1 rating assigned to
Cullman Regional Medical Center's (CRMC) $65 million of
outstanding Series 2009A bonds. The outlook has been revised to
stable based on improved operating performance and strengthened
balance sheet metrics in fiscal year (FY) 2013.
Summary Ratings Rationale:
Revision of the outlook to stable reflects the material
operational improvement in FY 2013. Inclusive of bad debt write
offs related to prior periods, CRMC improved the operating cash
flow margin to 9.6% from 5.8% in FY 2012. Improved operating
performance also allowed CRMC to grow unrestricted cash and
investments, achieving a multi-year high of days cash on hand and
other liquidity metrics. Affirmation of the Ba1 rating reflects
CRMC's sizeable debt load and stressed leverage measures.
Strengths:
-- CRMC significantly improved operating performance in FY 2013,
with the operating cash flow margin increasing to 9.6% from
5.8% in FY 2012 and 4.5% in FY 2011.
-- CRMC is the only hospital in Cullman County and owns all the
available bed licenses following the purchase and closure of
the only local competitor in 2009.
-- CRMC achieved sole community provider status under Medicare,
which increased Medicare reimbursement by $3.5 million in FY
2013. CRMC will continue to benefit at similar levels going
forward.
-- Unrestricted cash and investments reached a high of $38
million at FYE 2013, representing a multi-year trend of
increasing balances. Cash-to-direct debt and days cash on hand
both reached peak levels for the organization.
-- An engagement with Huntsville Health Care Authority (A1
stable) to manage CRMC's revenue cycle has been very
successful, and CRMC's days in accounts receivable have been
reduced to 46 days from a high of 80 days at FYE 2010. The
contract with Huntsville Hospital has been extended through
fall 2014.
Challenges:
-- CRMC has experienced two consecutive years of declining
patient volumes as measured by combined inpatient admissions
and observation stays; inpatient admissions have moved to
observation stays, but both indicators are down.
-- Revenue growth in FY 2013 was very low at 1.2%, although
Moody's does note that revenue exhibited growth following two
consecutive years of declines (measured with bad debt as a
contra revenue).
-- Capital spending is likely to remain low over the next several
years, suggesting that the average age of plant will rise. The
current age of plant is 13.9 years and has risen over the past
few years.
-- CRMC has a very challenging payer mix with high exposure to
bad debt and self-pay.
-- CRMC's debt load is very high, resulting in weak leverage
metrics, even in years when operating cash flow is high, such
as FY 2013. This is compounded by operating leases and an
unfunded pension liability that increase the organization's
comprehensive debt load.
Outlook:
Revision in the outlook to stable from negative reflects the
significant improvement in operating performance in FY 2013 and
through the first quarter of FY 2014. The stable outlook also
reflects the significant growth in balance sheet reserves that has
improved the cash-to-direct debt ratio.
What Could Make The Rating Go Up:
A rating upgrade will be considered if CRMC is able to maintain
operating performance at current levels, while continuing to add
to balance sheet reserves. A key consideration of an upgrade will
be the sustainability and consistency of operating performance.
Another key consideration will be reduction in leverage through
the pay-down of debt and improvement in operating cash flow that
reduces leverage.
What Could Make The Rating Go Down:
The rating could be downgraded if CRMC returns to operating
volatility and is not able to sustain the current positive
momentum. Other factors that could lead to a downgrade include a
sustained reduction in operating cash flow leading to weakened
leverage metrics.
DEMCO INC: Court Approves Horizons Consulting as Tax Consultant
---------------------------------------------------------------
The Hon. Michael J. Kaplan of the U.S. Bankruptcy Court for the
Western District of New York authorized Demco, Inc. to employ
Horizons Consulting, LLC, as tax consultants, effective as of
Aug. 26, 2013.
As reported in the Troubled Company Reporter on Oct. 10, 2013,
Horizons Consulting will assist the Debtor with pending audits by
the State of Texas for Texas state franchise taxes and for Texas
state sales and use taxes. The firm will also work with the
Debtor and the State of Texas auditor in the redetermination
process, seeking to resolve the audit adjustments.
Horizons Consulting will be paid based on the hourly rates of the
managing directors who will be primarily responsible for providing
services to the Debtor:
Douglas McCubbin, CPA $250
Daryl Jendras $250
Richard Pinger $250
Horizons Consulting will also be reimbursed for reasonable out-of-
pocket expenses incurred.
About Demco Inc.
Demco, Inc., aka Decommissioning & Environmental Management
Company, is a specialty trade contractor based in West Seneca, New
York, which provides demolition services, nuclear work,
environmental clean-up, disaster response and a variety of other
services throughout the United States and, on a project-by-project
basis, internationally. Some of Demco's better known demolition
projects in the past have included the Rocky Flats Nuclear Power
Plant, Yankee Stadium, the Orange Bowl, Buffalo Memorial
Auditorium, and the Sunflower Army Ammunition Plant.
Demco filed for Chapter 11 protection (Bankr. W.D.N.Y. Case No.
12-12465) on Aug. 6, 2012. Bankruptcy Judge Michael J. Kaplan
presides over the case. Daniel F. Brown, Esq., at Andreozzi,
Bluestein, Fickess, Muhlbauer Weber, Brown, LLP, represents the
Debtor in its restructuring effort. Freed Maxick CPAs, P.C.
serves as its accountants, and Horizons Consulting, LLC, serves as
its tax consultants. The Debtor estimated assets and debts at $10
million to $50 million. The petition was signed by Michael J.
Morin, controller.
Tracy Hope Davis, the U.S. Trustee for Region 2, appointed three
creditors to serve on the Official Committee of Unsecured
Creditors.
First Niagara Bank, the cash collateral lender, is represented by
William F. Savino, Esq., at Damon Morey.
DENIS E. BERGERON: Judge Won't Appoint Ch.11 Trustee for Now
------------------------------------------------------------
Bankruptcy Judge Stephani W. Humrickhouse denied the request of
Prestige Wealth Management, LLC, for appointment of a chapter 11
trustee to oversee the bankruptcy case of Denis E. Bergeron, the
manager and majority member of IYB Properties, LLC, in Bunn Level,
North Carolina.
"In holding that Prestige has failed to provide clear and
convincing evidence that appointment of a trustee is warranted
under these circumstances, the court is not condoning the debtor's
prepetition conduct and actions," Judge Humrickhouse said. "Given
this concern, debtor's postpetition conduct will be monitored and
should he exhibit any substantial violation of the duties,
obligations and requirements imposed upon him by the Bankruptcy
Code, the court will consider additional relief, which may include
the appointment of a trustee at a later point in the case."
In August 2012, Prestige commenced a civil action in the Wake
County Superior Court against Bergeron, IYB and other entities
affiliated with Bergeron, seeking injunctive relief and damages
for fraud, conversion, breach of fiduciary duty, constructive
trust and accounting, and breach of the security instruments.
IYB defaulted on a loan from Prestige in the principal amount of
$1.5 million. Bergeron was a guarantor to the debt.
A copy of Judge Humrickhouse's Order dated Oct. 31, 2013, is
available at http://is.gd/Z9i3lxfrom Leagle.com.
Denis E. Bergeron filed a Chapter 11 petition (Bankr. E.D.N.C.
Case No. 13-02912) on May 5, 2013.
DETROIT, MI: Emergency Manager Pressed on Pension Cuts at Trial
---------------------------------------------------------------
Joseph Lichterman, writing for Reuters, reported that Detroit's
unions called witnesses on Nov. 4 to testify that the city does
not belong in bankruptcy including representatives of a union and
retirees who said a negotiated settlement of the city's debts had
been possible before it filed for bankruptcy in mid-July.
According to the report, the testimony at the city's bankruptcy
eligibility hearing in U.S. Bankruptcy Court followed an
appearance by Kevyn Orr, Detroit's state-appointed emergency
manager. Mr. Orr added further nuance to the question of whether
a bankruptcy filing might violate pension protections enshrined in
Michigan's state constitution.
To be eligible for bankruptcy, Detroit must prove that it is
insolvent, that it negotiated in good faith with its creditors or
that negotiations were impracticable because of the number of
creditors, the report said.
With more than $18 billion in debt and other obligations, Detroit
filed the largest municipal bankruptcy in U.S. history on July 18,
the report noted.
The city plans to submit a restructuring plan to the court by the
end of the year if it is found eligible for bankruptcy, the report
added.
About Detroit, Michigan
The city of Detroit, Michigan, weighed down by more than
$18 billion in accrued obligations, sought municipal bankruptcy
protection on July 18, 2013, by filing a voluntary Chapter 9
petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed
more than $1 billion in both assets and debts.
Kevyn Orr, who was appointed in March 2013 as Detroit's emergency
manager, signed the petition. Detroit is represented by
lawyers at Jones Day and Miller Canfield Paddock and Stone PLC.
Michigan Governor Rick Snyder authorized the bankruptcy filing.
The filing makes Detroit the largest American city to seek
bankruptcy, in terms of population and the size of the debts and
liabilities involved.
The city's $18 billion in debt includes $5.85 billion in special
revenue obligations, $6.4 billion in post-employment benefits,
$3.5 billion for underfunded pensions, $1.13 billion on secured
and unsecured general obligations, and $1.43 billion on pension-
related debt, according to a court filing. Debt service consumes
42.5 percent of revenue. The city has 100,000 creditors and
20,000 retirees.
Detroit is represented by David G. Heiman, Esq., and Heather
Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett,
Esq., at Jones Day, in Los Angeles, California; and Jonathan S.
Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield
Paddock and Stone PLC, in Detroit, Michigan.
Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing
the American Federation of State, County and Municipal Employees
and the International Union.
Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is
representing the United Automobile, Aerospace and Agricultural
Implement Workers of America.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DETROIT, MI: To Delay Plan to List Retirees in Obamacare Exchanges
------------------------------------------------------------------
Joseph Lichterman, writing for Reuters, reported that the city of
Detroit will delay its plan to move retiree healthcare onto the
Affordable Care Act exchanges because of problems that are
plaguing the roll-out of the online insurance marketplaces, an
attorney representing the city said in bankruptcy court on Nov. 5.
According to the report, Detroit planned to provide all city
retirees who are not eligible for Medicare with a stipend to
purchase health coverage on the Affordable Care Act to take effect
on Jan. 1, said Heather Lennox, the city lawyer. Instead, Detroit
will delay the plan a month, extending the current coverage
through Jan. 31.
Emergency Manager Kevyn Orr announced changes to current and
retiree healthcare plans last month, the report related. Detroit
has $5.7 billion in liabilities for healthcare and other retiree
benefits, which accounts for about half of the city's $11.5
billion in unsecured debt.
The city will provide most retirees under 65, who are not yet
eligible for Medicare, $125 per month to purchase coverage on the
healthcare exchanges, the report said. Retirees with disabilities
will get $200 per month.
Retirees over 65 will choose from three Medicare Advantage plans,
in which the city will pay most or all of the premiums, the report
further related. They could also enroll in a Medicare Part D drug
plan for which Detroit will pay the premiums.
About Detroit, Michigan
The city of Detroit, Michigan, weighed down by more than
$18 billion in accrued obligations, sought municipal bankruptcy
protection on July 18, 2013, by filing a voluntary Chapter 9
petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed
more than $1 billion in both assets and debts.
Kevyn Orr, who was appointed in March 2013 as Detroit's emergency
manager, signed the petition. Detroit is represented by
lawyers at Jones Day and Miller Canfield Paddock and Stone PLC.
Michigan Governor Rick Snyder authorized the bankruptcy filing.
The filing makes Detroit the largest American city to seek
bankruptcy, in terms of population and the size of the debts and
liabilities involved.
The city's $18 billion in debt includes $5.85 billion in special
revenue obligations, $6.4 billion in post-employment benefits,
$3.5 billion for underfunded pensions, $1.13 billion on secured
and unsecured general obligations, and $1.43 billion on pension-
related debt, according to a court filing. Debt service consumes
42.5 percent of revenue. The city has 100,000 creditors and
20,000 retirees.
Detroit is represented by David G. Heiman, Esq., and Heather
Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett,
Esq., at Jones Day, in Los Angeles, California; and Jonathan S.
Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield
Paddock and Stone PLC, in Detroit, Michigan.
Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing
the American Federation of State, County and Municipal Employees
and the International Union.
Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is
representing the United Automobile, Aerospace and Agricultural
Implement Workers of America.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DETROIT, MI: Bankruptcy Looked 'Premeditated,' Ex-Treasurer Said
----------------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that Andy Dillon, Michigan's
former treasurer, wrote an e-mail while he was still in office
questioning the initial justification for Detroit's $18 billion
bankruptcy, saying it made the filing appear "premeditated."
According to the report, the e-mail, written eight days before the
July 18 filing, was presented on Nov. 5 in federal court at a
trial over Detroit's eligibility for bankruptcy protection. In the
e-mail, Dillon criticized an early version of the letter that the
city's emergency manager, Kevyn Orr, sent to the governor seeking
permission to file the record municipal bankruptcy.
About a month before the filing, Orr had proposed canceling
about $3.5 billion in unfunded liabilities owed to the city's
two pension funds and $1.4 billion in unsecured pension bonds
held by investors. Those debts would be replaced by about $2
billion in new notes the city would issue. Dillon said yesterday
that the offer was so low he "became very skeptical" a deal
could be reached out of court.
"I don't think we are making the case why we are giving up so soon
to reach an out of court settlement," Dillon wrote in the e-mail.
"Looks premeditated."
Dillon said at the Nov. 5 hearing that his comments in the e-mail
were incorporated into the final letter that Orr sent the
governor. That letter cited the extent of pension and retiree
health-care obligations as well as an inability to reach a
settlement with creditors among the justifications for the filing.
U.S. Bankruptcy Judge Steven Rhodes in Detroit has been presiding
over a trial to determine whether the city can continue to be
shielded from lawsuits and other actions that may interfere with
its restructuring efforts. Municipalities temporarily gain such
protections when they file for bankruptcy under Chapter 9 of the
U.S. Bankruptcy Code.
Municipal unions and retired city workers argue that Orr, along
with state officials including Dillon and Governor Rick Snyder,
favored bankruptcy over negotiation so they could cut pensions
otherwise protected by the Michigan Constitution. They have said
the debt swap Orr proposed would have forced cuts in monthly
payments to retirees.
About Detroit, Michigan
The city of Detroit, Michigan, weighed down by more than
$18 billion in accrued obligations, sought municipal bankruptcy
protection on July 18, 2013, by filing a voluntary Chapter 9
petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed
more than $1 billion in both assets and debts.
Kevyn Orr, who was appointed in March 2013 as Detroit's emergency
manager, signed the petition. Detroit is represented by
lawyers at Jones Day and Miller Canfield Paddock and Stone PLC.
Michigan Governor Rick Snyder authorized the bankruptcy filing.
The filing makes Detroit the largest American city to seek
bankruptcy, in terms of population and the size of the debts and
liabilities involved.
The city's $18 billion in debt includes $5.85 billion in special
revenue obligations, $6.4 billion in post-employment benefits,
$3.5 billion for underfunded pensions, $1.13 billion on secured
and unsecured general obligations, and $1.43 billion on pension-
related debt, according to a court filing. Debt service consumes
42.5 percent of revenue. The city has 100,000 creditors and
20,000 retirees.
Detroit is represented by David G. Heiman, Esq., and Heather
Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett,
Esq., at Jones Day, in Los Angeles, California; and Jonathan S.
Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield
Paddock and Stone PLC, in Detroit, Michigan.
Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing
the American Federation of State, County and Municipal Employees
and the International Union.
Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is
representing the United Automobile, Aerospace and Agricultural
Implement Workers of America.
A nine-member official committee of retired workers was appointed
in the case. The Retirees' Committee is represented by Dentons US
LLP.
DIGITAL REALTY: S&P Affirms 'BB+' Preferred Stock Rating
--------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Digital
Realty Trust Inc. to negative from stable. At the same time, S&P
affirmed its 'BBB' corporate credit rating on the company, its
'BBB' rating on the senior unsecured debt, and its 'BB+' rating
on the preferred stock.
The ratings on Digital reflect a business risk profile that S&P
currently considers "satisfactory". The company has grown rapidly
since its inception, becoming a leading data center landlord.
However, the company has faced recent challenges, including
delayed lease commencements, an accounting correction for
straight-line rent adjustments, a reduced acquisition outlook for
2013, and a near-term earnings drag until proceeds from a recent
joint venture are reinvested. Digital's core same-property net
operating income (NOI) grew 7% year-to-date on a cash basis,
largely on rent increases (as same-store occupancy slipped 50
basis points [bps] sequentially and 240 bps year-over-year).
However, the company has pushed out the timing expectations for
the stabilization of its large development investment, ultimately
lowering expected 2013 funds from operations (FFO) by about 3.5%.
S&P now expects leverage and debt service coverage metrics to
erode in 2014 from current levels. S&P's revised base-case
financial metrics remain supportive of its assessment of the
company's financial risk profile as "intermediate". However, a
development stumble, same-store rent declines, or meaningful share
repurchase activity could prompt a revision of S&P's assessment of
the company's financial risk profile.
San Francisco-based Digital is one of the largest data center
landlords, with investments in real estate (before depreciation)
of about $9.6 billion as of Sept. 30, 2013. The company's
"satisfactory" business risk profile is supported by a
130-property portfolio (188 buildings throughout North America,
Europe, Asia, and Australia) that remains well-leased (93.0%
occupied at quarter end) despite recent modest occupancy declines.
The outlook is negative. "We view the wide gap between lease
signing and lease commencement as an unfavorable trend that is
likely to persist through 2014," said Standard & Poor's credit
analyst Elizabeth Campbell. If development investments through
2014 are financed largely with debt and preferred stock, as S&P
currently expects, and the time to stabilization remains
protracted, Digital's debt plus preferred to EBITDA would rise.
If this increase were coupled with a large share repurchase, S&P
would modify its assessment of the company's financial risk
profile to "significant" from "intermediate," which would result
in a one-notch downgrade. S&P' could also lower the ratings if
any additional operating infrastructure challenges come to light
or there is a development stumble. Alternatively, S&P could
affirm the ratings and assign a stable outlook if recent operating
difficulties prove to be temporary, isolated events, and
development lease-up and stabilization accelerate and contribute
cash flow more quickly than we currently anticipate, sustaining
current leverage metrics.
EARL GAUDIO: Committee May Retain Tap Rubin & Levin as Counsel
--------------------------------------------------------------
The Official Unsecured Creditors' Committee of Earl Gaudio & Son,
Inc., obtained approval from the U.S. Bankruptcy Court for the
Central District of Illinois to retain Rubin & Levin, P.C., as its
counsel.
As reported in the Troubled Company Reporter on Sept. 20, 2013,
Rubin & Levin will be paid based on these hourly rates:
Elliott D. Levin, Partner $450
James E. Rossow Jr., Partner $375
Edward R. Cardoza, Of Counsel $350
Christopher M. Trapp, Associate $325
Jonathan M. Dickey, Associate $300
Paraprofessionals $150
About Earl Gaudio & Son Inc.
Earl Gaudio & Son Inc. filed a Chapter 11 petition (Bankr. C.D.
Ill. Case No. 13-90942) on July 19, 2013. The petition was signed
by Angela E. Major Hart, as authorized signer of First Midwest
Bank, custodian. Judge Gerald D. Fines presides over the case.
The Debtor estimated assets of at least $10 million and debts of
at least $1 million. John David Burke, Esq., at Ice Miller, LLP,
serves as the Debtor's counsel. Wermer, Rogers, Doran & Ruzon
serves as its accountants.
The U.S. Trustee for Region 10, appointed three members to the
official committee of unsecured creditors in the Debtor's Chapter
11 case. Rubin & Levin, P.C., serves as the Committee's counsel;
R. Lee Allen, Esq. of Sorling Northrup serves as Special Counsel;
and Evans, Forehlich, Beth & Chamley as local counsel.
EARL GAUDIO: Sorling Northrup Approved as Panel's Special Counsel
-----------------------------------------------------------------
The Official Unsecured Creditors of Earl Gaudio & Son Inc.
obtained U.S. Bankruptcy Court approval to retain R. Lee Allen,
Esq., at Sorling Northrup as Special Counsel.
As reported in the Troubled Company Reporter on Sept. 18, 2013,
the Debtor said it wished to employ Sorling Northrup as special
counsel, nunc pro tunc to the Petition Date, to continue the work
that Sorling Northrup has been performing prior to the Petition
Date, including working in concert with the Debtor's bankruptcy
counsel and the Custodian to negotiate issues related to the sale
transaction as well as assisting in preparing for and effecting a
closing thereof.
The normal billing rates of professionals employed by Sorling
Northrup ranges from approximately $200/hour to $260/ hour.
R. Lee Allen's rate is $260/ hour.
About Earl Gaudio & Son Inc.
Earl Gaudio & Son Inc. filed a Chapter 11 petition (Bankr. C.D.
Ill. Case No. 13-90942) on July 19, 2013. The petition was signed
by Angela E. Major Hart, as authorized signer of First Midwest
Bank, custodian. Judge Gerald D. Fines presides over the case.
The Debtor estimated assets of at least $10 million and debts of
at least $1 million. John David Burke, Esq., at Ice Miller, LLP,
serves as the Debtor's counsel. Wermer, Rogers, Doran & Ruzon
serves as its accountants.
The U.S. Trustee for Region 10, appointed three members to the
official committee of unsecured creditors in the Debtor's Chapter
11 case. Rubin & Levin, P.C., serves as the Committee's counsel;
R. Lee Allen, Esq. of Sorling Northrup serves as Special Counsel;
and Evans, Forehlich, Beth & Chamley as local counsel.
EARL GAUDIO: Committee May Hire Evans Forehlich as Local Counsel
----------------------------------------------------------------
The Official Unsecured Creditors appointed in Earl Gaudio & Son
Inc.'s Chapter 11 case obtained U.S. Bankruptcy Court permission
to retain Evans, Forehlich, Beth & Chamley as local counsel.
As reported in the Troubled Company Reporter on Sept. 18, 2013,
the firm's rates are:
Professional Rates
------------ -----
Joseph P. Chamley, Partner $200
Paraprofessionals $100
About Earl Gaudio & Son Inc.
Earl Gaudio & Son Inc. filed a Chapter 11 petition (Bankr. C.D.
Ill. Case No. 13-90942) on July 19, 2013. The petition was signed
by Angela E. Major Hart, as authorized signer of First Midwest
Bank, custodian. Judge Gerald D. Fines presides over the case.
The Debtor estimated assets of at least $10 million and debts of
at least $1 million. John David Burke, Esq., at Ice Miller, LLP,
serves as the Debtor's counsel. Wermer, Rogers, Doran & Ruzon
serves as its accountants.
The U.S. Trustee for Region 10, appointed three members to the
official committee of unsecured creditors in the Debtor's Chapter
11 case. Rubin & Levin, P.C., serves as the Committee's counsel;
R. Lee Allen, Esq. of Sorling Northrup serves as Special Counsel;
and Evans, Forehlich, Beth & Chamley as local counsel.
EARL GAUDIO: Can Employ Wermer Rogers as Accountants
----------------------------------------------------
Earl Gaudio & Son, Inc., through its custodian First Midwest Bank,
obtained permission from the U.S. Bankruptcy Court for the Central
District of Illinois to employ Wermer, Rogers, Doran & Ruzon as
accountants.
As reported in the Troubled Company Reporter on Oct. 10, 2013,
Wermer Rogers will assist in preparing the Debtor's 2012 federal
and state tax returns.
The billing rates of professionals employed by Wermer Rogers for
this engagement will be $150 per hour. Wermer Rogers will also be
reimbursed for reasonable out-of-pocket expenses incurred.
About Earl Gaudio & Son Inc.
Earl Gaudio & Son Inc. filed a Chapter 11 petition (Bankr. C.D.
Ill. Case No. 13-90942) on July 19, 2013. The petition was signed
by Angela E. Major Hart, as authorized signer of First Midwest
Bank, custodian. Judge Gerald D. Fines presides over the case.
The Debtor estimated assets of at least $10 million and debts of
at least $1 million. John David Burke, Esq., at Ice Miller, LLP,
serves as the Debtor's counsel. Wermer, Rogers, Doran & Ruzon
serves as its accountants.
The U.S. Trustee for Region 10, appointed three members to the
official committee of unsecured creditors in the Debtor's Chapter
11 case. Rubin & Levin, P.C., serves as the Committee's counsel;
R. Lee Allen, Esq. of Sorling Northrup serves as Special Counsel;
and Evans, Forehlich, Beth & Chamley as local counsel.
EARL SIMMONS: DMX Promises to Play Nice in Bankruptcy
-----------------------------------------------------
Jacqueline Palank, writing for The Wall Street Journal, reported
that after the Justice Department called out DMX on some problems
with his bankruptcy filing, the rapper said he'll do what it takes
to successfully reorganize his financial affairs.
According to the report, DMX's attorney is urging the Manhattan
bankruptcy court to let the rapper exercise his right to
reorganize in Chapter 11, which is currently under threat from a
bankruptcy watchdog from the Department of Justice. That
watchdog, U.S. Trustee Tracy Hope Davis, has asked the court to
convert the rapper's Chapter 11 restructuring to a Chapter 7
liquidation or throw out the case entirely, citing inconsistent
information about the rapper's financial status and his failure to
show up at a meeting of his creditors.
In court papers filed Nov. 1, DMX lawyer Joel Shafferman said the
rapper "is committed to fulfilling his obligations as a debtor in
possession and successfully reorganizing under Chapter 11," the
report related.
Mr. Shafferman said that includes attending a rescheduled meeting
of DMX's creditors and turning over financial information to clear
up the inconsistencies in the rapper's prior court filings, like
one filing listing $0 worth of clothing among his assets while
another said he spends $1,000 per month on clothes, the report
said.
About DMX
DMX, whose real name is Earl Simmons, is known for the late '90s
hit "Party Up (Up in Here)" and has also appeared in such movies
as "Romeo Must Die," the report noted. He filed for bankruptcy on
July 29, 2013 (Bankr. S.D.N.Y. Case No. 13-23254) to address
debts including more than $1.2 million in child-support
obligations.
Simmons's official lists of assets and debt show property with a
value of $1.4 million and liabilities totaling $2.3 million. At
the outset, he listed a home in Mt. Kisco, New York, with a
$434,000 mortgage. The official lists filed later show no owned
real estate.
EFS COGEN: S&P Assigns Prelim. 'BB+' Rating on $825MM Facility
--------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its
preliminary 'BB+' senior secured rating and '1' preliminary
recovery rating to EFS Cogen Holdings I LLP's proposed
$825 million term loan B facility. The '1' preliminary recovery
rating indicates a very high likelihood of recovery (90% to 100%)
of principal in a default scenario. The outlook is stable.
EFS Cogen Holdings LLC is a special purpose, bankruptcy-remote
entity that will own two gas-fired combined cycle cogeneration
facilities located on the site of the Phillips 66 Bayway Refinery
in Linden, N.J. GE EFS, which currently owns 100% of these assets,
has entered into an agreement to sell a 50% interest in EFS Cogen
to Highstar Capital IV L.P. The assets consist of two gas-fired
combined cycle cogeneration facilities, the 777 MW Linden 1-5
facility, completed in May 1992, and the 165 MW Linden 6 facility,
completed in January 2002.
The preliminary 'BB+' rating reflects S&P's view of the following
weaknesses:
-- Merchant exposure after April 2017;
-- Relatively high initial debt kW ratio ($876);
-- Some merchant exposure during the remaining three and a
half-year contractual period;
-- Less forward price visibility in the New York ISO market
than in other regions, including PJM;
-- No mandatory major maintenance reserve; and
-- Age of the Linden 1-5 assets.
The following strengths mitigate weaknesses at the 'BB+' rating
level:
-- A very strong and long operating history, as indicated by
consistently high availability factors;
-- Physical location in PJM with principal power sales contract
into New York City, one of the most transmission-constrained
and high-priced power markets in the country;
-- Investment-grade off-takers (Con Ed and Phillips 66);
-- Three and one-half years remaining life on all contracted
obligations (April 2017); and
-- Upgrades to the facilities in 2007 that improved heat rates.
Liquidity is a neutral ratings factor. EFS Cogen benefits from
liquidity support in the form of a six-month debt service account
that it may fund with cash or with an LOC from a highly rated
bank. S&P views the absence of a major maintenance reserve fund
as a credit weakness.
The stable outlook reflects S&P's expectation that the revised
ownership of the two Linden assets will continue to successfully
manage the project, and that the term loan is fully repaid by
maturity. The Con Edison and Phillips 66 contracts provide
stability to the project's cash flow and debt repayment
projections for the first three and one-half years. S&P do not
consider there to be upside potential to the rating given the
merchant exposure that the project has during the latter half of
the debt period. Downside ratings pressure would result from
material operating difficulties, such as low availability factors
or heat rate degradations, that led to remaining debt outstanding
that was closer to 65% to 70% of the initial debt rather than the
expected 50%, when the merchant period begins.
ENDO HEALTH: Moody's Affirms 'Ba3' CFR; Outlook Remains Negative
----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of Endo Health
Solutions Inc. including the Ba3 Corporate Family Rating and the
Ba3-PD Probability of Default Rating. This rating action follows
the announcement that Endo will acquire Paladin Labs Inc. for
approximately $1.6 billion, to be funded primarily with stock. The
transaction also involves an inverse-merger structure in which
both Endo and Paladin Labs will be acquired by a newly-formed
Irish holding company. The rating outlook remains negative.
Ratings affirmed
Ba3 Corporate Family Rating
Ba3-PD Probability of Default Rating
Ba1 (LGD2, 21%) senior secured bank credit facilities
B1 (LGD5, 72%) senior unsecured notes
SGL-2 Speculative Grade Liquidity Rating
Ratings Rationale:
Moody's views the Paladin Labs acquisition as credit-positive
because Endo will gain EBITDA and cash flow as well as improved
revenue diversity without any substantial increase in debt.
Further, the Irish ownership structure provides tax savings that
will be reflected in Endo's future cash flow. Despite these
benefits, the rating outlook remains negative primarily because of
Endo's somewhat-high financial leverage, the risks associated with
ongoing surgical mesh litigation and the uncertainty created by a
dynamic acquisition strategy.
Endo's Ba3 Corporate Family Rating reflects its modest size and
scale relative to larger pharmaceutical peers, partially offset by
the company's solid market positioning as a niche player in the
pain and urology markets and by its revenue diversity across
branded drugs, generic drugs and medical devices. Endo's expertise
in pain drugs and its good compliance with US Drug Enforcement
Agency (DEA) regulations act as high barriers to entry, also a
credit strength. The company faces a significant challenge
reviving top-line growth because of generic pressures affecting
two branded franchises (Lidoderm and Opana ER) and softness in
medical procedure volumes. Amidst these pressures, Endo changed
senior leadership and is undergoing major cost reduction
initiatives and business development activities. Although there
are many variables, the Moody's believes that the Ba3 Corporate
Family Rating reflects a variety of scenarios in which debt/EBITDA
is sustained within a range of 3.0 to 4.0 times.
Moody's anticipates that Endo will refinance certain parts of its
capital structure, including the early repurchase of the
convertible notes due April 2015. Because of a reduction in
subordinated debt, any new senior secured credit facilities could
be rated lower than the existing senior secured rating of Ba1,
which Moody's expects to withdraw. Moody's anticipates that Endo's
senior unsecured debt will continue to be rated B1.
The rating outlook is negative. Despite the credit-positive nature
of the Paladin Labs acquisition described above, Moody's does not
yet believe that Endo's credit profile has fully stabilized
because of downward EBITDA trends, recent senior management
changes, uncertain success in future M&A activity and the impact
on leverage, and rising exposure to surgical mesh litigation
cases. Although not expected in the near term, Moody's could
upgrade Endo's ratings if the company restores internal growth
rates and reduces litigation uncertainties while sustaining
conservative credit metrics including gross debt/EBITDA below 3.0
times. Conversely, Moody's could downgrade Endo's ratings if gross
debt/EBITDA is sustained above 4.0 times. This scenario could
occur if Endo performs debt-financed M&A, faces substantial
litigation cash outflows, or suffers worse-than-expected operating
setbacks on products like Lidoderm or Opana ER.
Headquartered in Malvern, Pennsylvania, Endo Health Solutions is a
U.S.-focused specialty healthcare company offering branded and
generic pharmaceuticals, medical devices and services. Endo's key
areas of focus include pain management, urology, oncology and
endocrinology. For the 12 months ended September 30, 2013 Endo
reported net revenues of approximately $3.0 billion.
ENERGY FUTURE: Default Possible by Year-End, CreditSights Says
--------------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that Energy Future Holdings
Corp. may violate a debt covenant by the end of this year,
potentially allowing for secured creditors to force a default and
take over its power generation and retail units, according to debt
researcher CreditSights Inc.
According to the report, the secured debt to earnings before
interest, taxes, depreciation and amortization ratio for the
company's Texas Competitive unit is approaching a level that could
trip a covenant violation by as soon as the fourth quarter,
CreditSights analysts Andy DeVries and Charles Johnston wrote
on Nov. 5 in a note to investors. Secured creditors could use such
an event to take over the unit, the analysts wrote.
Auditors may raise doubts about Energy Future's ability to remain
a going concern in regulatory filings due 60 days after the end of
2013, which would also trigger a default, according to the note.
Energy Future, which was bought in 2007 for $48 billion by private
equity firms including KKR & Co., TPG Capital and Goldman Sachs
Capital Partners, has been negotiating with creditors to
restructure some or all of its units, excluding its power line
utility Oncor Electric Delivery. The company made a $270 million
interest payment on Nov. 1 to unsecured lenders after failing to
reach a reorganization agreement, Chief Financial Officer Paul
Keglevic said Nov. 5 during a conference call with investors.
The company remains in discussions with advisers of creditor
groups on a potential "consensual restructuring," Keglevic said.
As of Sept. 30, Dallas-based Energy Future had almost $2 billion
in available liquidity, Keglevic said.
"We'll continue to consider and evaluate a range of future changes
to our capital structure, which may include filing a voluntary
case under Chapter 11 of the United States Bankruptcy Code for
some or all of EFH Corp. and its subsidiaries, excluding" Oncor,
he said during the call.
About Energy Future Holdings, fka TXU Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80 percent-owned entity within the EFH group, is the largest
regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
Restructuring Talks With Creditors
In April 2013, Energy Future Holdings Corp., Energy Future
Competitive Holdings Company, Texas Competitive Electric Holdings
Company LLC, and Energy Future Intermediate Holding Company LLC
confirmed in a regulatory filing that they are in restructuring
talks with certain unaffiliated holders of first lien senior
secured claims concerning the Companies' capital structure.
The Companies expect to continue to explore all available
restructuring alternatives to facilitate the creation of
sustainable capital structures for the Companies and to otherwise
attempt to address the Creditors' concerns with the Restructuring
Proposal and Sponsor Proposal.
The Companies have retained Kirkland & Ellis LLP and Evercore
Partners to advise the Companies with respect to the potential
changes to the Companies' capital structure and to assist in the
evaluation and implementation of other potential restructuring
options.
The Creditors have retained Paul, Weiss, Rifkind, Wharton &
Garrison LLP and Millstein & Co., L.P. to advise the Creditors and
to assist in the Creditors' evaluation of potential restructuring
options involving the Companies.
According to a Wall Street Journal report, people familiar with
the matter said Apollo Global Management LLC, Oaktree Capital
Management, Centerbridge Partners and GSO Capital Partners, the
credit arm of buyout firm Blackstone Group LP, all hold large
chunks of Energy Future Holdings' senior debt. Many of these
firms belong to a group being advised by Jim Millstein, a
restructuring expert who helped the U.S. government revamp
American International Group Inc.
According to the Journal, people familiar with Apollo's thinking
said Apollo enlisted investment bank Moelis & Co. for additional
advice to ensure it gets as much attention as possible on the case
given its large debt holdings.
EVERGREEN OIL: Sues Chartis, Lloyd's Over Fire Coverage
-------------------------------------------------------
Law360 reported that Irvine, Calif.-based Evergreen Oil Inc. on
Nov. 1 accused Chartis Property Casualty Co., Lloyd's of London
and others of forcing it into bankruptcy by undervaluing its
claims and failing to pay for millions of dollars in damages
incurred from a fire at one of its refineries.
According to the report, Chartis, Lloyd's, National Union Fire
Insurance Co. of Pittsburgh, Pa., and Swiss Re International SE
mischaracterized damages and delayed payments, rendering Evergreen
unable to pay contractors to rebuild the refinery and ultimately
preventing it from obtaining a reasonable profit.
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 have tapped 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 disclosed $83,739,748 in assets and $89,302,759 in
liabilities as of the Chapter 11 filing.
The Official Committee of Unsecured Creditors is represented by
Alan I. Nahmias, Esq., at Mirman, Bubman & Nahmias, LLP represents
the Committee.
Bank of the West is represented by William B. Freeman, Esq., at
Katten Muchin Rosenman LLP.
On Sept. 13, 2013, the Court entered an order confirming the
Debtors' Third Amended Joint Plan of Reorganization Dated July 29,
2013.
EWGS INTERMEDIARY: Case Summary & 25 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor entities filing separate Chapter 11 cases:
Debtor Case No.
------ --------
EWGS Intermediary, LLC 13-12876
20 Hill Avenue NW
Fort Walton Beach, FL 32548
Edwin Watts Golf Shops, LLC 13-12877
20 Hill Avenue NW
Fort Walton Beach, FL 32548
Chapter 11 Petition Date: November 4, 2013
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Hon. Mary F. Walrath
Debtors' Counsel: Domenic E. Pacitti, Esq.
KLEHR HARRISON HARVEY BRANZBURG LLP
919 Market Street, Suite 1000
Wilmington, DE 19801
Tel: 302-552-5511
Fax: 302-426-9193
Email: dpacitti@klehr.com
Debtors' Fin'l FTI Consulting, Inc.
Advisor:
Debtors' Claims Epiq Bankruptcy Solutions, Inc.
and Noticing
Agent:
Estimated Assets: $100 million to $500 million
Estimated Debts: $10 million to $50 million
The petitions were signed by Lynda K. Barr, chief financial
officer.
Consolidated List of Debtors' 25 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Callaway Golf Co. merchandise $4,634,931
2180 Rutherford Road
Carlsbad, CA 92008
Tel: n/a
Fax: (760)804-4291
Email: cg_customer.service@callawaygolf.com
Taylor Made-Adidas Golf Co. merchandise $3,824,169
Attn: Diane Thomas
5545 Fermi CT
Carlsbad, CA 92008
Tel: (760)918-6000
Fax: (216)533-2661
Titleist merchandise $3,188,728
333 Bridge Street
Fairhaven, MA 02719
Tel: (800)225-8500
Fax: (508)979-3092
Nike USA Inc. merchandise $1,789,495
1 SW Bowerman Dr
Beaverton, OR 97005-0979
Tel: (503)671-6453
Fax: (503)532-0400
Footjoy merchandise $1,544,838
144 Field St.
Brockton, MA 12302
Tel: (508)979-2000
Fax: (508)979-3927
Email:firstsight@joyfootinc.com
Cobra Puma Golf Inc. merchandise $1,540,281
1818 Aston Ave
Carsbad, CA 92008
Tel: (800)843-5464
Fax: (760)710-3380
Email: kristine.ownens@cobrapuma.com
Adams Golf, Ltd. merchandise $1,186,851
2801 East Plano Parkway
Plano, TX 75074
Tel: (972)673-9000
Fax: (972)398-8818
Cleveland Golf Co. merchandise $1,085,187
Attn: Angie
P.O. Box 7270
Newport Beach, CA 92658-7270
Tel: (714)889-1300
Fax: (714)889-5890
Email: customerservice@clevelandgolf.com
Fifth Third Bank Court Settlement $732,231
Attn: Brad J. Boersma
999 Vanderbild Beach Road
Naples, FL 34108
Tel: (239)449-7045
Fax: (239)449-7105
Karsten Manufacturing Corp. merchandise $694,898
2201 W Desert Cove
Phoenix, AZ 85029
Tel: (602)870-5000
Fax: (602) 687-4482
Wilson Sporting Goods merchandise $671,917
8750 W. Bryn Mawr Ave
Chicago, IL 60631
Tel: (773)714-6400
Fax: (773)714-4590
Email: askwilson@wilson.com
Mizuno Golf Company merchandise $384,100
Corporate Headquarters
4925 Avalon Ridge Parkway
Norcross, GA 30071
Tel: (770)441-5553
Fax: (850)243-6421
Tigershark Golf merchandise $366,767
29706 West Tech Dr
Wixom, MI 48393
Tel: (586)758-7807
Fax: (586)-758-7819
Sean Smith, SDS Retail acquisition- $314,166
Operations, Inc. seller
6137 Verness Cove
Salt Lake City, UT 84121
Tel: n/a
Fax: (801)544-0199
Bridgetone Sports/Precept merchandise $310,433
500 S Schmale RD
Carolstream, IL 60088
Tel: (770)787-7400
Fax: (800)358-6319
Bushnell Outdoor Products merchandise $305,705
9200 Cody
Overland Park, KS 66214
Tel: (913)752-3400
Fax: (913)752-3550
US Kids Golf, LLC merchandise $256,276
3040 Northwoods Parkway
Norcross, GA 30071
Tel: (770)441-3077
Fax: (770)448-3069
Oakley Sales Corp. merchandise $220,147
Heavy Putter LLC merchandise $173,938
J & M Golf merchandise $164,445
Pride Manufacturing Co LLC merchandise $162,826
Deca International Corp. merchandise $161,630
Seemore Putter Company merchandise $151,507
Tour Edge Golf Mfg. Inc. merchandise $149,161
Garmin International merchandise $135,773
EWGS INTERMEDIARY: Meeting to Form Creditors' Panel on Nov. 12
--------------------------------------------------------------
Roberta A. DeAngelis, United States Trustee for Region 3, will
hold an organizational meeting on Nov. 12, 2013 at 10:30 a.m. in
the bankruptcy cases of EWGS Intermediary, LLC, et al. The
meeting will be held at:
J. Caleb Boggs Federal Building
844 King Street, Room 2112
Wilmington DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors
pursuant to Section 341 of the Bankruptcy Code. A representative
of the Debtor, however, may attend the Organizational Meeting, and
provide background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States
Trustee appoint a committee of unsecured creditors as soon as
practicable. The Committee ordinarily consists of the persons,
willing to serve, that hold the seven largest unsecured claims
against the debtor of the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee
may consult with the debtor, investigate the debtor and its
business operations and participate in the formulation of a plan
of reorganization. The Committee may also perform other services
as are in the interests of the unsecured creditors whom it
represents.
Privately held EWGS Intermediary and Edwin Watts Golf Shops filed
for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-12876)
on Nov. 4, 2013.
FAIRFAX FINANCIAL: Fitch Affirms 'BB' Rating on 5 Preferred Shares
------------------------------------------------------------------
Fitch Ratings has affirmed and withdrawn the ratings of Fairfax
Financial Holdings Limited (Fairfax) as follows:
-- Issuer Default Rating (IDR) at 'BBB';
-- Senior debt at 'BBB-'.
Fitch has also affirmed and withdrawn the Insurer Financial
Strength (IFS) ratings of Fairfax's subsidiaries at 'A-'.
At the time of the ratings withdrawal the Rating Outlook was
Stable for the affirmed ratings. A full list of rating actions is
provided at the end of this release.
Fitch has decided to discontinue the ratings, which are
uncompensated.
Key Rating Drivers:
Fitch's rationale for the affirmation of Fairfax's ratings
reflects the company's sizable cash position and favorable
financial flexibility. The ratings also reflect anticipated
challenges in the overall competitive, but generally improving,
property/casualty market rate environment, the potential for
additional adverse reserve development, particularly on older
accident years and in runoff operations, earnings volatility from
catastrophes and investments, and increased financial leverage.
Fitch's rating action also considers the recent announcement that
Fairfax and other institutional investors will invest $1 billion
of convertible debentures into BlackBerry Ltd., with Fairfax
agreeing to provide $250 million principal of the debentures.
Fitch does not expect this transaction to significantly increase
the company's financial leverage, decrease holding company cash,
deplete insurance subsidiary capital or result in a concentrated
investment of Fairfax's capital. Fairfax currently owns about 10%
of BlackBerry.
Fairfax posted a net loss of $563 million for the first nine
months of 2013 compared to $541 million of net income for full-
year 2012. The deterioration was driven by significant net
unrealized investment losses of $1.2 billion in the first nine
months of 2013, primarily from bonds ($0.9 billion) with rising
interest rates and common stock losses after equity hedges ($0.3
billion).
Fairfax reported a nine month 2013 consolidated combined ratio of
93.9%, which included 4.9 points for catastrophe losses. This is
improved from 99.8% for full-year 2012, which included 7.0 points
for catastrophe losses (4.5 points from Hurricane Sandy).
Excluding the effect of catastrophes and favorable reserve
development, Fairfax's underlying run-rate accident year combined
ratio remains reasonable at 94.1% for the first nine months of
2013, reduced from 95.8% in 2012.
The company continues to maintain a sizable amount of holding
company cash and investments of $1 billion (excluding assets
pledged for short sale and derivative obligations) at Sept. 30,
2013. Fitch believes this provides Fairfax with a sufficient
cushion in meeting potential subsidiary cash flow shortages and
liquidity to service its debt.
Fairfax's financial leverage ratio was 34.9% at Sept. 30, 2013, up
from 33% at Dec. 31, 2012, as overall debt increased with a
CDN$250 million re-opening of senior notes used to repurchase
$48.4 million of holding company debt. The company used the
remaining proceeds to repay $183 million of Odyssey Re senior
notes at maturity on Nov. 1, 2013, resulting in pro forma
financial leverage of 33.8% at Sept. 30, 2013.
Operating earnings-based interest and preferred dividend coverage
(excluding net gains and losses on investments) have been very low
in recent years as operating earnings have declined with weaker
underwriting results and high catastrophe losses. Including
holding company cash, operating earnings-based coverage has been
better, averaging 6.3x from 2008 to 2012.
Fitch has affirmed and withdrawn the following ratings:
Fairfax Financial Holdings Limited
-- IDR at 'BBB';
-- $82 million 8.25% due Oct. 1, 2015 at 'BBB-';
-- $144 million 7.375% due April 15, 2018 at 'BBB-';
-- CDN$400 million 7.5% due Aug. 19, 2019 at 'BBB-';
-- CDN$275 million 7.25% due June 22, 2020 at 'BBB-'.
-- $500 million 5.8% due May 15, 2021 at 'BBB-';
-- CDN$400 million 6.4% due May 25, 2021 at 'BBB-';
-- CDN$450 million 5.84% senior notes due Oct. 14, 2022 at 'BBB-';
-- $92 million 8.3% due April 15, 2026 at 'BBB-';
-- $91 million 7.75% due July 15, 2037 at 'BBB-';
-- CDN$250 million series C preferred shares at 'BB';
-- CDN$200 million series E preferred shares at 'BB';
-- CDN$250 million series G preferred shares at 'BB';
-- CDN$300 million series I preferred shares at 'BB';
-- CDN$237.5 million series K preferred shares at 'BB'.
Fairfax, Inc.
-- IDR at 'BBB'.
Crum & Forster Holdings Corp.
-- IDR at 'BBB'.
Crum & Forster Insurance Group:
Crum and Forster Insurance Company
Crum & Forster Indemnity Company
The North River Insurance Company
United States Fire Insurance Company
First Mercury Insurance Company
-- IFS at 'A-'.
Northbridge Financial Insurance Group:
Federated Insurance Company of Canada
Northbridge Commercial Insurance Corporation
Northbridge General Insurance Corporation
Northbridge Indemnity Insurance Corporation
Northbridge Personal Insurance Corporation
Zenith Insurance Company (Canada)
-- IFS at 'A-'.
Odyssey Re Holdings Corp.
-- IDR at 'BBB';
-- $50 million series A unsecured due March 15, 2021 at 'BBB-';
-- $50 million series B unsecured due March 15, 2016 at 'BBB-';
-- $40 million series C unsecured due Dec. 15, 2021 at 'BBB-';
-- $125 million 6.875% due May 1, 2015 at 'BBB-'.
Odyssey Reinsurance Company
-- IFS at 'A-'.
Zenith National Insurance Corp.
-- IDR at 'BBB'.
Zenith Insurance Company
ZNAT Insurance Company
-- IFS at 'A-'.
FOREVER GREEN: Court Dismisses Involuntary Petition
---------------------------------------------------
Charles C. Dawson, Kelli L. Dawson, and the law firm of Cohen,
Seglias, Pallas, Greenhall & Furman, PC -- collectively with the
Dawsons, the "Petitioning Creditors" -- filed an involuntary
petition under chapter 11 of the Bankruptcy Code (Bankr. E.D. Pa.
Case No. 12-13888) on April 20, 2012, against Forever Green
Athletic Fields, Inc. Forever Green seeks dismissal of the
Involuntary Petition on the grounds that it is a bad-faith filing
and an abuse of the bankruptcy system initiated by the Petitioning
Creditors to frustrate the prosecution of the Forever Green's
claims against Mr. Dawson, ProGreen Surfaces, Inc., Daniel A.
DaLuise, Donna L. DaLuise, Raymond Fritz, and ProGreen Sports
Surfaces, LLC.
All parties concede that each of the Petitioning Creditors holds
bona fide claims against Forever Green and that a sufficient
numbers of creditors have filed the Involuntary Petition.
However, Forever Green has alleged that the Petitioning Creditors,
and specifically, Mr. Dawson, filed the Involuntary Petition as a
litigation tactic designed to frustrate Forever Green's ability to
litigate pending state court proceedings and to force Forever
Green to settle its claims.
In a Nov. 1 Memorandum available at http://is.gd/XWVyVdfrom
Leagle.com, Bankruptcy Judge Magdeline D. Coleman ruled that Mr.
Dawson was not motivated by a proper bankruptcy purpose. The
record before the Court demonstrates that Mr. Dawson effectuated
the filing of the Involuntary Petition in furtherance of his pre-
existing scheme to frustrate the prosecution of a pending
arbitration proceeding as well as to force Forever Green to pay
Mr. Dawson's claim ahead of Forever Green's other creditors.
Forever Green is a corporation organized and existing under the
laws of the Commonwealth of Pennsylvania with its principal place
of business of 124 South Maple Street, Suite 100, Ambler,
Pennsylvania 19002. Forever Green was formed for the purpose of
selling and installing artificial grass athletic fields.
FRESH & EASY: Prime Clerk Approved as Administrative Advisor
------------------------------------------------------------
Fresh & Easy Neighborhood Market Inc., et al., obtained court
authority to employ Prime Clerk LLC as administrative advisor,
nunc pro tunc, as of the Petition Date.
Judge Kevin Carey held that Primes Clerk will not be entitled to
indemnification, contribution or reimbursement for services other
than the services provided under the parties Services Agreement,
unless approved by the Court.
Michael J. Frishberg is the co-president and chief operating
officer of Prime Clerk, LLC. He may be reached at:
PRIME CLERK, LLC
830 Third Avenue, 9th Floor
New York, NY 10022
Tel: 212-257-5450
E-mail: mfrishberg@primeclerk.com
About Fresh & Easy Neighborhood Market Inc.
Fresh & Easy Neighborhood Market Inc., and its affiliate filed
Chapter 11 petitions (Bankr. D. Del. Case Nos. 13-12569 and
13-12570) on Sept. 30, 2013. The petitions were signed by James
Dibbo, chief financial officer. Judge Kevin J. Carey presides
over the case.
Fresh & Easy owes $738 million to Cheshunt, England-based Tesco,
the U.K.'s biggest retailer. Fresh & Easy never made a profit and
lost an average of $22 million a month in the 12 months ended in
February, according to court papers.
Jones Day serves as lead bankruptcy counsel. Richards, Layton &
Finger, P.A., serves as local Delaware counsel. Alvarez & Marsal
North America, LLC, serves as financial advisors, and Alvarez &
Marsal Securities, LLC, serves as investment banker. Prime Clerk
LLC acts as the Debtors' claims and noticing agent. Gordon
Brothers Group, LLC, and Tiger Capital Group, LLC, serves as the
Debtors' consultant. Pillsbury Winthrop Shaw Pittman LLP serves as
special corporate counsel. The Debtors estimated assets of at
least $100 million and liabilities of at least $500 million.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed five
creditors to serve in the Official Committee of Unsecured
Creditors in the Chapter 11 cases of Fresh & Easy Neighborhood
Market Inc., et al.
FRESH & EASY: Richards Layton Approved as Delaware Counsel
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Fresh & Easy Neighborhood Market Inc., et al., to employ Richards,
Layton & Finger, P.A., as their local Delaware counsel, nunc pro
tunc, as of the Petition Date.
As reported in the Troubled Company Reporter on Oct. 10, 2013,
the principal professionals and paraprofessionals designated to
represent the Debtors and their current standard hourly rates are:
Mark D. Collins, Esq. $775
John H. Knight, Esq. $675
Lee Kaufman, Esq. $450
Amanda R. Steele, Esq. $350
William A. Romanowicz, Esq. $250
Ann Jerominski, paralegal $215
The firm will also be reimbursed for any necessary out-of-pocket
expenses.
About Fresh & Easy Neighborhood Market Inc.
Fresh & Easy Neighborhood Market Inc., and its affiliate filed
Chapter 11 petitions (Bankr. D. Del. Case Nos. 13-12569 and
13-12570) on Sept. 30, 2013. The petitions were signed by James
Dibbo, chief financial officer. Judge Kevin J. Carey presides
over the case.
Fresh & Easy owes $738 million to Cheshunt, England-based Tesco,
the U.K.'s biggest retailer. Fresh & Easy never made a profit and
lost an average of $22 million a month in the 12 months ended in
February, according to court papers.
Jones Day serves as lead bankruptcy counsel. Richards, Layton &
Finger, P.A., serves as local Delaware counsel. Alvarez & Marsal
North America, LLC, serves as financial advisors, and Alvarez &
Marsal Securities, LLC, serves as investment banker. Prime Clerk
LLC acts as the Debtors' claims and noticing agent. Gordon
Brothers Group, LLC, and Tiger Capital Group, LLC, serves as the
Debtors' consultant. The Debtors estimated assets of at least $100
million and liabilities of at least $500 million.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed five
creditors to serve in the Official Committee of Unsecured
Creditors in the Chapter 11 cases of Fresh & Easy Neighborhood
Market Inc., et al.
FRIENDFINDER NETWORKS: Disclosure Statement Approved
----------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that FriendFinder Networks
Inc., the owner of Penthouse magazine and thousands of adult-
oriented websites, won court approval to seek creditors' votes on
its restructuring plan, which would turn the company over to
noteholders.
According to the report, U.S. Bankruptcy Judge Christopher Sontchi
approved the company's disclosure statement, a description of the
reorganization plan, at a hearing on Nov. 5 in Wilmington,
Delaware.
The disclosure statement provides creditors with "all the
information necessary to make an informed decision on whether to
accept or reject the plan," FriendFinder attorney Matthew L.
Hinker said at the hearing.
FriendFinder will seek court approval of its reorganization plan
to exit bankruptcy at a hearing scheduled for Dec. 16. Objections
to the plan have to be filed by Dec. 9.
The restructuring would cut about $300 million in debt and reduce
annual interest expenses by about $50 million, according to a
statement. The reorganized company's estimated enterprise value
was between $257.8 million and $285.4 million as of Aug. 31,
according to the disclosure statement.
The reorganization plan is supported by about 78 percent of the
holders of 11.5 percent non-cash paying second-lien notes and
about 80 percent of the holders of 14 percent senior secured
first-lien notes, court papers show.
The second-lien noteholders, owed about $330.8 million, would
exchange debt for all of reorganized FriendFinder's equity. The
first-lien noteholders, owed about $234.3 million, would get cash
and new notes. Current shareholders would receive nothing,
according to court documents.
FriendFinder has more than 8,000 websites spanning more than 200
countries with more than 220 million members and over 750,000
paying subscribers, according to court papers. The websites offer
social-networking and adult dating, video-sharing and live
interactive video entertainment. In addition to publishing
Penthouse magazine, the company licenses the brand for content
such as pay-per-view programming.
Sales decreased about 10 percent to $293.7 million for the fiscal
year ended June 30. Revenue from social-networking websites
dropped more than 17 percent while live interactive-video websites
generated about 8 percent more.
The company hasn't made a profit since at least 2006 and reported
a second-quarter net loss of $10.3 million, or 32 cents a share,
on Aug. 15.
About FriendFinder Networks
FriendFinder Networks and affiliates, including lead debtor PMGI
Holdings Inc., sought bankruptcy protection (Bankr. D. Del. Lead
Case No. 13-12404) on Sept. 17, 2013, estimating assets of
$465.3 million and debt totaling $662 million.
The Debtors are represented by Nancy A. Mitchell. Esq., Matthew L.
Hinker, Esq., and Paul T. Martin, Esq., at Greenberg Traurig, LLP,
in New York, as lead bankruptcy counsel; and Dennis A. Meloro,
Esq., in Wilmington, Delaware, as local Delaware counsel. Akerman
Senterfitt serves as the Debtors' special and conflicts counsel.
The Debtors' financial advisor is SSG Capital Advisors LLC. BMC
Group, Inc., is the Debtors' claims and noticing agent.
On Sept. 21, 2013, the Debtors filed a plan of reorganization
containing details on a reorganization worked out with about 80
percent of first and second-lien lenders before the Sept. 17
Chapter 11 filing. Under the Plan, holders of the $234.3 million
in 14 percent first-lien notes will receive accrued interest plus
an equal amount in new 14 percent first-lien notes to mature in
five years. Excess cash will be used in part to pay down
principal on the notes before maturity. Holders of $330.8 million
in two issues of second-lien notes are to receive all the new
equity.
GETTY PETROLEUM: Lukoil Settlement Impacts Getty Realty Results
---------------------------------------------------------------
Getty Realty Corp. disclosed that on July 29, 2013, the Bankruptcy
Court approved a settlement between Lukoil and certain former
directors and officers of Getty Petroleum Marketing Inc.,
collectively, and the Marketing Estate, of the claims made in the
Lukoil Complaint. The terms of the Lukoil Settlement included a
release of the defendants from the claims alleged in the Lukoil
Complaint and a collective payment to the Marketing Estate of
$93.0 million of which $25.1 million was distributed to Getty
Realty Corp. pursuant to the Litigation Funding Agreement and $6.6
million was distributed to the Company in full satisfaction of the
Company's post-petition priority claims related to the lease with
Marketing. Of the $25.1 million received under the Litigation
Funding Agreement, $8.0 million was accounted for as a repayment
of advances made to the Marketing Estate plus accrued interest;
$14.0 million was accounted for as payment of rent and real estate
taxes due from Marketing, and the related bad debt reserve was
reversed; and the remainder of $3.1 million was recorded as
additional income and is reflected in continuing operations in the
Company's consolidated statement of operations as other revenue.
The Company may realize additional distributions from the
Marketing Estate for its remaining general unsecured claims
stemming from Marketing's default of its obligations under the
Master Lease as and when assets that remain in the Marketing
Estate become available for distribution to Marketing's creditors.
The Company's results for the quarter and nine months ended
September 30, 2013 continued to be materially affected by events
surrounding Marketing including the benefit derived from the
Lukoil Settlement, legal costs associated with that litigation,
ongoing eviction proceedings, gains realized from actual
dispositions of properties and impairment charges primarily
related to anticipated property dispositions, and elevated
operating expenses related to properties previously leased to
Marketing which are still in transition. The Company anticipates
that many of these elevated operating costs, including legal and
other litigation costs and property operating expenses, will
diminish as the ongoing repositioning of the properties previously
leased to Marketing begins to draw to a close in the coming
quarters. Certain other costs, particularly environmental
remediation costs, are expected to remain elevated as compared to
prior periods for the foreseeable future. For these reasons, the
impact from the magnitude of the repositioning adjustments and
expenditures make comparisons of performance for 2013 and 2012
less meaningful.
About Getty Realty
Headquartered in Jericho, New York, Getty Realty Corp. --
http://www.gettyrealty.com-- is a publicly-traded real estate
investment trust in the United States specializing in ownership,
leasing and financing of convenience store/gas station properties.
The Company currently owns and leases approximately 1,040
properties nationwide.
About Getty Petroleum
A remnant of J. Paul Getty's oil empire, Getty Petroleum Marketing
markets gasoline, hydraulic fluids, and lubricating oils through
a network of gas stations owned and operated by franchise holders.
A former subsidiary of Russian oil giant LUKOIL, the company
operates in the Mid-Atlantic and Northeastern US states. Getty
Petroleum Marketing's primary asset is the more than 800 gas
stations in the Mid-Atlantic states which are located on
properties owned by Getty Realty. After scaling back the
company's operations to cut debt, in 2011 LUKOIL sold Getty
Petroleum Marketing to investment firm Cambridge Petroleum Holding
for an undisclosed price.
Getty Petroleum and three affiliates filed for Chapter 11
bankruptcy (Bankr. S.D.N.Y. Case Nos. 11-15606 to 11-15609) on
Dec. 5, 2011. Judge Shelley C. Chapman presides over the case.
Loring I. Fenton, Esq., John H. Bae, Esq., Kaitlin R. Walsh, Esq.,
and Michael J. Schrader, Esq., at Greenberg Traurig, LLP, in New
York, N.Y., serve as the Debtors' counsel. Ross, Rosenthal &
Company, LLP, serves as accountants for the Debtors. Getty
Petroleum Marketing, Inc., disclosed $46.6 million in assets and
$316.8 million in liabilities as of the Petition Date. The
petition was signed by Bjorn Q. Aaserod, chief executive officer
and chairman of the board.
The Official Committee of Unsecured Creditors is represented by
Wilmer Cutler Pickering Hale and Dorr LLP. Alvarez & Marsal North
America, LLC, serves as the Committee's financial advisors.
GOLDEN NUGGET: Moody's Ba3 Rating Unaffected by Refinancing Change
------------------------------------------------------------------
Moody's Investors Service stated that the Ba3 rating on Golden
Nugget Inc.'s proposed $300 million senior secured term loan, $150
million senior secured delayed draw term loan, and $75 million
senior secured revolver, as well as the Caa1 rating on the
proposed $300 million senior unsecured notes of Golden Nugget
Escrow, Inc. are unaffected by the changes to the company's
proposed refinancing. Golden Nugget's Caa3 Corporate Family Rating
and Caa3-PD Probability of Default Rating remain on review for
upgrade where they were placed on November 1.
Golden Nugget, Inc. is headquartered in Las Vegas, Nevada and is a
wholly-owned unrestricted subsidiary of Landry's Inc. (B2,
Stable). The company owns and operates the Golden Nugget hotel,
casino, and entertainment resorts in downtown Las Vegas and
Laughlin, Nevada. Annual net revenue is approximately $245
million.
GOLDEN NUGGET: S&P Retains 'B' CCR Over Refinancing Changes
-----------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings,
including the 'B' corporate credit rating, on Nevada-based gaming
operator Golden Nugget Inc. are unchanged following the company's
proposed changes to its refinancing and project financing
transaction.
The proposed transaction will result in an incremental $45 million
in debt raised, which S&P expects will help fund the build-out of
restaurants and additional hotel rooms at the new Lake Charles
casino. Golden Nugget plans to raise $50 million in additional
term loan proceeds ($350 million total) and to reduce its senior
unsecured notes by $5 million to $295 million.
Despite the additional debt, S&P continues to expect interest
coverage, pro forma for the first full year of EBITDA contribution
from the Lake Charles property, to remain at about 2x, where it
was prior to the changes. S&P also expects Golden Nugget's
financial profile to improve over time as a result of the
continued ramp-up of the Lake Charles property.
Golden Nugget plans to use the proceeds from the proposed
transaction, along with equity proceeds from Tilman Fertitta and a
$30 million loan for furniture, fixtures, and equipment (FF&E;
unrated), to:
-- Repay about $430 million in existing Golden Nugget debt;
-- Fund the $230 million initial purchase price and
approximately $283 million in remaining construction costs
for Golden Nugget Lake Charles;
-- Establish an interest reserve account totaling $30 million
to fund debt service; and
-- Fund transaction fees and expenses.
S&P expects to withdraw its issue-level ratings on the company's
existing first-lien senior secured credit facilities and second-
lien term loan once the loans are repaid.
S&P's corporate credit rating on Golden Nugget reflects its
assessment of the company's financial risk profile as "highly
leveraged" and its assessment of the company's business risk
profile as "weak."
"Our assessment of Golden Nugget's financial risk profile as
highly leveraged reflects our expectation that leverage will be
high and coverage weak through the development period, although
the interest reserve provides some cushion. In addition, we
expect leverage, pro forma for the transaction and for the first
full year of Lake Charles, will decrease to about 7x and coverage
will be about 2x. We expect the company's financial profile will
improve in the second full year of operations as a result of the
continued ramp up in Lake Charles' performance and from
amortization required under the term loans. We expect leverage to
improve to about 6x in 2015," S&P said.
"Our assessment of Golden Nugget's business risk profile as weak
reflects limited diversification and scale from its ownership of
two properties in Nevada, the concentration of its cash flows in
the mature downtown Las Vegas market, and the volatility of that
market during the recent economic recession. Additionally, our
business risk assessment takes into account some construction and
execution risk associated with the development and opening of the
Lake Charles casino. Golden Nugget's high-quality assets and
leading market position relative to competitors in downtown Las
Vegas, enhanced by improvements to the property in previous years,
somewhat offset the negative factors. In addition, our business
risk profile assessment incorporates our expectation that the Lake
Charles property will improve diversity and roughly double the
size of the company's cash flow base," S&P added.
S&P's view of Landry's credit quality also has some bearing on its
rating on Golden Nugget. Although Golden Nugget will no longer be
a subsidiary of Landry's following the completion of the financing
and acquisition, both entities are owned by Tilman Fertitta and
share management teams. S&P believes the Golden Nugget assets
have strategic importance to the portfolio of investments held by
Tilman Fertitta (which also includes Landry's), given the strength
of the Golden Nugget brand name and the inclusion of Landry's
restaurants within the properties. In addition, given other
casino investments that Fertitta holds under the Golden Nugget
brand name in Atlantic City, N.J., and Biloxi, Miss., S&P believes
Landry's or Fertitta may be incentivized to provide financial
support to Golden Nugget, if necessary.
RATINGS LIST
Golden Nugget Inc.
Corporate Credit Rating B/Stable/--
Ratings Unchanged
Golden Nugget Inc.
Senior Secured
$350M* term loan due 2019 BB-
Recovery Rating 1
Senior Unsecured
$295M* nts due 2021 CCC+
Recovery Rating 6
* New amounts following proposed changes to the refinancing.
HELIA TEC: Sec. 341 Creditors' Meeting Set for Nov. 19
------------------------------------------------------
The U.S. Trustee will convene a meeting of creditors pursuant to
11 U.S.C. 341(a) in the Chapter 11 case of Helia Tec Resources,
Inc., on Nov. 19, 2013, at 10:00 a.m. The meeting will be held at
Houston, 515 Rusk Suite 3401.
The deadline to file proofs of claim is Feb. 18, 2014.
Helia Tec Resources, Inc. filed a Chapter 11 petition (Bankr. S.
D. Tex. Case No. 13-36251) on Oct. 3, 2013 in Houston, Texas,
represented by Richard L. Fuqua, II, Esq., at Fuqua & Associates,
PC, in Houston, as counsel to the Debtor. The Debtor listed
$16.15 million in assets and $2.24 million in liabilities. The
petition was signed by Cary E. Hughes, president.
HOSTESS BRANDS: Kroger to Pay $2-Mil. to End Row Over Products
--------------------------------------------------------------
Law360 reported that the company that was once the iconic Hostess
Brands Inc. on Nov. 1 landed a $1.95 million settlement with The
Kroger Co. that resolves a dispute over $2.8 million in Hostess
products that the supermarket chain allegedly received but never
paid for.
According to the report, under the terms of the deal, Kroger,
which disputed part of the amount Hostess contended it was owed,
will pay Old HB Inc. the $1.95 million and drop its claims filed
against the fallen snack company's estate.
About Hostess Brands
Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known
for iconic brands such as Butternut, Ding Dongs, Dolly Madison,
Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride,
Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution
centers and 570 outlets in 49 states.
Hostess filed for Chapter 11 bankruptcy protection early morning
on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through
12-22056) in White Plains, New York. Hostess Brands disclosed
assets of $982 million and liabilities of $1.43 billion as of the
Chapter 11 filing.
The bankruptcy filing was made two years after predecessors
Interstate Bakeries Corp. and its affiliates emerged from
bankruptcy (Bankr. W.D. Mo. Case No. 04-45814).
In the new Chapter 11 case, Hostess has hired Jones Day as
bankruptcy counsel; Stinson Morrison Hecker LLP as general
corporate counsel and conflicts counsel; Perella Weinberg Partners
LP as investment bankers, FTI Consulting, Inc. to provide an
interim treasurer and additional personnel for the Debtors, and
Kurtzman Carson Consultants LLC as administrative agent.
Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry
Wilson, the head of turnaround and restructuring firm MAEVA
Advisors, are representing the Teamsters union.
Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain
Millers International Union and Bakery & Confectionery Union &
Industry International Pension Fund are Jeffrey R. Freund, Esq.,
at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David
A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright &
Jaworski L.L.P.
The official committee of unsecured creditors selected New York
law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom
Mayer and Ken Eckstein head the legal team for the committee.
Hostess Brands in mid-November 2012 opted to pursue the orderly
wind down of its business and sale of its assets after the Bakery,
Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a
nationwide strike. The Debtor failed to reach an agreement with
BCTGM on contract changes.
Hostess Brands sold its businesses and most of the plants to five
different buyers for an aggregate of $860 million. Hostess still
has some plants, depots and other facilities the buyers didn't
acquire.
The bankruptcy estate has changed its name to Old HB Inc.
HOUSTON DLM: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Houston DLM Investment Group, L.L.C.
P O Box 27233
Houston, TX 77227
Case No.: 13-36929
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Hon. Marvin Isgur
Debtor's Counsel: Thomas Baker Greene, III, Esq.
LAW OFFICE OF THOMAS B. GREENE III
2311 Steel St.
Houston, TX 77098
Tel: 713-882-2312
Email: tbgreeneiii@msn.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Willis Pumphrey, Jr., managing member.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
INT'L CHURCH OF OVERCOMERS: Voluntary Chapter 11 Case Summary
-------------------------------------------------------------
Debtor: International Church of Overcomers, Inc.
1200 Southpointe Dr.
DeSoto, TX 75115
Case No.: 13-35791
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Harlin DeWayne Hale
Debtor's Counsel: Pro Se
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by Bruce Carter, trustee.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
IVENS PROPERTIES: Must Confirm Plan by Jan. 31
----------------------------------------------
Bankuptcy Judge Richard Stair Jr., declined to grant, for now, the
request of Capital Bank, N.A., for modification of the automatic
stay pursuant to 11 U.S.C. Sec. 362(d)(3) (2006) to permit it to
enforce its Deed of Trust encumbering Lot 1 of the property of
Ivens Construction, Inc., Map File 2166B, in Blount County,
Tennessee, owned by Ivens Properties, Inc. Judge Stair said the
automatic stay shall remain in effect but is conditioned upon the
Debtor proposing and obtaining confirmation of a Chapter 11 plan
within 90 days. In the event that a confirmation order has not
entered on or before Jan. 31, 2014, the stay shall be terminated
without further action by Capital Bank or further court order.
A copy of the Court's Oct. 31, 2013 Memorandum and Order is
available at http://is.gd/Aoo1F6from Leagle.com.
Ivens Properties, Inc., Maryville, Tenn., filed for Chapter 11
bankruptcy (Bankr. E.D. Tenn. Case No. 13-32471) on July 3, 2013,
listing $2,055,000 in assets and $962,700 in liabilities. The
Debtor is a single-asset real estate debtor as defined by the
Bankuptcy Code in 11 U.S.C. Sec. 101(51B). Judge Richard Stair,
Jr., oversees the case. Keith L. Edmiston, Esq., at Gribble
Carpenter & Associates, PLLC, serves as the Debtor's counsel. The
petition was signed by Mark Ivens, president.
J.C. PENNEY: Sales Improve but Worries Remain
---------------------------------------------
Suzanne Kapner, writing for The Wall Street Journal, reported that
J.C. Penney Co. is expected to say this week that its sales turned
positive in October -- but that won't quell worries about the
retailer's financial health.
According to the report, any improvement in sales would be welcome
news, indicating that the 1,100-store chain is doing a better job
of converting its inventory into cash. The concern, though, is
that sales won't rise fast enough or be profitable enough to head
off the need to raise more cash next year.
Penney shares have risen over the past two weeks, and the
retailer's bonds have followed suit, reflecting investors'
anticipation of better news, the report related. That emphasis on
sales gains misses the mark, says David Tawil, the co-founder and
portfolio manager of Maglan Capital.
"The important metrics will be gross margin and cash burn, not
comp-store sales," said Mr. Tawil, whose fund doesn't currently
have a position in Penney's stock, the report cited.
Kristin Hays, a Penney spokeswoman, declined to comment on
financial performance, citing the quiet period before its earnings
release later this month, the report further related.
J.C. Penney Company, Inc. is one of the U.S.'s largest department
store operators with about 1,100 locations in the United States
and Puerto Rico.
* * *
As reported in the Troubled Company Reporter on Oct. 4, 2013,
Fitch Ratings has downgraded the Issuer Default Ratings (IDRs) on
J.C. Penney Co., Inc. and J.C. Penney Corporation, Inc. to 'CCC'
from 'B-'.
JEFFERSON COUNTY, AL: To Sell $1.74 Billion of Sewer Debt
---------------------------------------------------------
Michelle Kaske & Martin Z. Braun, writing for Bloomberg News,
reported that Alabama's Jefferson County is set to sell about
$1.74 billion of sewer-refinancing debt this month as part of a
plan to exit court protection almost two years after what began as
the largest U.S. municipal bankruptcy.
According to the report, Citigroup Inc., as lead underwriter, will
price the warrants as soon as Nov. 19, according to a person with
direct knowledge of the transaction who asked not to be identified
on Nov. 4 in discussing it before sale results are final. A period
for individuals to place orders for the securities will begin the
day before pricing is set, the person said.
In July, Citigroup said it would market the Jefferson County debt
to short-term investors and present potential buyers with a
picture of securities that are poised to gain over the next five
years as the sewer system's finances improve, the bank's
underwriting proposal shows, the report related. The county of
660,000 residents is home to Birmingham, Alabama's most-populous
city.
"Our targeted buyers for the warrants will not be long-term
holders as is often the case with high-grade municipal bonds, but
rather savvy short-term buyers who recognize the significant
potential for improvement in the county and its warrants over
time," according to Citigroup's proposal, the report further
related. The New York-based bank holds some Jefferson County
sewer debt, which will be purchased with proceeds from the
refinancing, according to a preliminary sale document released
late on Nov. 4.
About Jefferson County
Jefferson County has its seat in Birmingham, Alabama. It has a
population of 660,000.
Jefferson County filed a bankruptcy petition under Chapter 9
(Bankr. N.D. Ala. Case No. 11-05736) on Nov. 9, 2011, after an
agreement among elected officials and investors to refinance
$3.1 billion in sewer bonds fell apart.
John S. Young Jr. LLC was appointed as receiver by Alabama Circuit
Court Judge Albert Johnson in September 2010.
Jefferson County's bankruptcy represents the largest municipal
debt adjustment of all time. The county said that long-term debt
is $4.23 billion, including about $3.1 billion in defaulted sewer
bonds where the debt holders can look only to the sewer system for
payment.
The county said it would use the bankruptcy court to put a value
on the sewer system, in the process fixing the amount bondholders
should be paid through Chapter 9.
Judge Thomas B. Bennett presides over the Chapter 9 case. Lawyers
at Bradley Arant Boult Cummings LLP and Klee, Tuchin, Bogdanoff &
Stern LLP, led by Kenneth Klee, represent the Debtor as counsel.
Kurtzman Carson Consultants LLC serves as claims and noticing
agent. Jefferson estimated more than $1 billion in assets. The
petition was signed by David Carrington, president.
The bankruptcy judge in January 2012 ruled that the state court-
appointed receiver for the sewer system largely lost control as a
result of the bankruptcy. Before deciding whether Jefferson County
is eligible for Chapter 9, the bankruptcy judge will allow the
Alabama Supreme Court to decide whether sewer warrants are the
equivalent of "funding or refunding bonds" required under state
law before a municipality can be in bankruptcy.
U.S. District Judge Thomas B. Bennett ruled in March 2012 that
Jefferson County is eligible under state law to pursue a debt
restructuring under Chapter 9. Holders of more than $3 billion in
defaulted sewer debt had challenged the county's right to be in
Chapter 9.
In June 2013, the county reached settlement with holders of
78 percent of the $3.1 billion in sewer debt at the core of the
county's financial problems. The bondholders will be paid
$1.84 billion through a refinancing, according to a term sheet.
The settlement calls for JPMorgan Chase & Co., the owner of
$1.22 billion in bonds, to make the largest concessions so other
bondholder will recover more.
On June 30, 2013, Jefferson County filed a Chapter 9 plan of debt
adjustment. Pursuant to the Plan, sewer bondholders will receive
65 percent in cash. If they elect to waive claims against
JPMorgan and bond insurers, they receive 80 percent in cash.
Bondholders supporting the plan already agreed to waive claims and
receive the larger recovery. Existing sewer bonds will be
canceled in exchange for payments under the plan. The county will
fund plan distributions by selling new sewer bonds calculated to
generate $1.96 billion to cover the $1.84 billion earmarked for
existing sewer bondholders. JPMorgan has agreed to waive $842
million of the sewer debt and a $657 million swap debt, resulting
in an 88 percent overall write off by JPMorgan. To finance the
new sewer bonds, there will be 7.4 percent in rate increases for
sewer customers in each of the first four years. In later years,
rate increases will be 3.5 percent.
LEHMAN BROTHERS: Ex-Officers to Pay $9.75-Mil. to Municipalities
----------------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that former Lehman Brothers
Holdings Inc. officers of the failed investment bank agreed to pay
$9.75 million to resolve claims by California municipalities over
alleged investment losses, lawyers for the plaintiffs said.
According to the report, the San Mateo County Investment Pool, the
city of Burbank and five other government entities settled a
lawsuit against ex-Lehman Chief Executive Officer Richard Fuld and
nine other former officers and directors, according to an e-mailed
statement on Nov. 5.
The California plaintiffs accused the executives and directors a
2009 lawsuit in federal court in Manhattan, of misleading
investors about Lehman's risk-management policies before its 2008
collapse.
John Maltbie, San Mateo's county manager, said the county south of
San Francisco lost $155 million on its Lehman bond investments and
has recovered about $62 million.
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 (Bankr. S.D.N.Y.
Case No. 08-13555) on Sept. 15, 2008. 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 distribution of $14.2 billion on April 4, 2013. The
brokerage is yet to make a first distribution to non-customers,
although customers are being paid in full.
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.
LEVI STRAUSS: Moody's Affirms 'B1' Rating on $300MM Notes
---------------------------------------------------------
Moody's Investors Service revised Levi Strauss and Co.'s ("LS&Co")
outlook to positive from stable. Moody's also assigned a
Speculative Grade Liquidity rating of SGL-1. All other ratings
including the Ba3 Corporate Family Rating were affirmed.
The revision of LS&Co's outlook to positive reflects the company's
meaningful improvement in leverage over the course of 2013. It
also reflects improved operating margins at LS&Co as they have
moved to 12.2% from 10% over the last 3 quarters as the company
has benefited from lower cotton prices and improving operating
efficiency. During the same period, debt levels have declined by
almost $200 million. Moody's expects the company will maintain its
improvements in operating efficiency and continue to utilize its
significant cash flows to address its upcoming debt maturities. As
a result Debt/EBITDA (incorporating Moody's standard analytical
adjustments) has fallen below 4x and Moody's expects the company
to continue to utilize its strong cash flows to reduce debt during
2014.
The SGL-1 reflects the company's very good overall liquidity
profile. As of August 25, 2013, the company had cash balances of
$382 million. In addition, the company has access to an asset
based credit facility in the US which totals $850 million with
unused availability in excess of $500 million. The company has no
debt maturities until 2016 when its asset based credit facility
matures and it has approximately $40 million of Yen denominated
Eurobonds due. The company has no financial maintenance covenants
in any of its debt arrangements (other than a springing fixed
charge coverage covenant in its asset based revolver, which
Moody's does not anticipate will be tested). The company has
meaningful unencumbered assets including its Dockers' trademark
and (outside the US) the Levi's trademark as well as meaningful
amounts of unencumbered accounts receivable and inventory outside
North America.
The following ratings were assigned:
Speculative Grade Liquidity rating at SGL-1
The following ratings were affirmed and LGD assessments amended:
Corporate Family Rating at Ba3
Probability of Default Rating at Ba3-PD
EUR300 million senior unsecured notes due 2018 at B1 (LGD 4, 63%
from LGD 4, 64%)
$525 million senior unsecured notes due 2020 to B1 (LGD 4, 63%
from LGD 4, 64%)
$525 million senior unsecured notes due 2022 at B1 (LGD 4, 63%
from LGD 4, 64%)
Ratings Rationale:
LS&Co's Ba3 rating reflects its moderate leverage (LTM adjusted
debt /EBITDA is 3.9x) which Moody's anticipates will continue to
improve as the company utilizes operating cash flow to reduce
debt. The rating also reflects the iconic nature of the Levi's
trademark, LS&Co's global reach with sales in over 110 countries
and meaningful scale with net revenues in excess of $4.6 billion.
The rating is constrained by the company's limited product
diversification with men's slacks accounting for the significant
majority of net revenues. The rating also reflects the company's
exposure to volatile input costs which can have a meaningful
impact on earnings and cash flows.
The positive outlook reflects Moody's expectations that the
company will continue to generate approximately $200 million in
free cash flow and will reduce debt levels over the next 12-18
months in line with its stated objectives. Moody's also expects
the company to maintain operating margins at least at their
current level. Moody's also expects the company to maintain
dividend policies consistent with its recent history.
Ratings could be upgraded if the company makes continued progress
deleveraging its balance sheet while maintaining its operating
margins. Quantitatively, ratings could be upgraded if debt/EBITDA
is sustained below 3.75 times and EBITA/interest is sustained
above 2.75 times.
The rating outlook could be stabilized if the company fails to
maintain the improvements in margin Moody's has see over the first
half of the year or if financial policy were to change such that
cash flows were unlikely to be utilized for debt reduction and
debt/EBITDA was expected to remain in the low 4 times range.
Ratings could be downgraded if the company were to see sustained
negative trends in sales and operating margins which would most
likely result from contraction in market share or a sustained
global downturn. Ratings could be downgraded if the company's very
good liquidity profile were to meaningfully erode. Quantitatively
ratings could be downgraded if debt/EBITDA was sustained above 5
times.
Headquartered in San Francisco, California, Levi Strauss & Co
designs and markets jeans, casual wear and related accessories
under the "Levi's", "Dockers", "Signature by Levi Strauss & Co."
and "Denizen" brands. The company sells product in more than 110
countries through chain retailers, department stores, online sites
and franchised and company-owned stores. Levi Strauss & Co.'s net
revenues exceed $4.6 billion.
LIC CROWN: To Seek Confirmation of Prepack Plan on Dec. 10
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has scheduled a combined hearing on Dec. 10, 2013, at 4:00 p.m. to
consider (i) confirmation of LIC Crown Mezz Borrower LLC, et al.'s
prepackaged liquidating Chapter 11 plan and (ii) approval of the
explanatory disclosure statement.
According to the scheduling order, objections to approval of the
disclosure statement and/or confirmation of the Plan are due not
less than 7 days prior to the hearing.
As reported in the Oct. 18, 2013 edition of the TCR, under the
Plan, claims against and equity interests in the debtors are
divided into classes and will receive the distributions and
recoveries as follows:
Est. Amount of
Type of Claim Allowed Claims Est. Recovery
------------- -------------- -------------
Administrative Claims $___ 100%
Priority Tax Claims $___ 100%
Fee Claims TBD 100%
Other Priority Claims $___ 100%
Mortgage Lender Claim $71,559,083 100%
Mezzanine Lender Claim $57,022,400 --
General Unsecured Claims $645,498 100%
Equity Interests N/A --
On the Effective Date, the Debtors will transfer and convey to the
designee of Factory Mezz, LLC, as Mezzanine Lender, the real
property commonly known as the Factory Building, located at 47-44
31st Street, Block 282, Lot 1, in Long Island, County of Queens,
in New York. On the Effective Date, the Mezzanine Lender will
transfer to the Debtors for the benefit of holders of equity
interests $5.0 million, without set-offs or offset for any claims
or deductions not specifically contemplated under the Plan Support
and Cooperation Agreement dated Oct. 2, 2013, payable to Gerstein
Strauss & Rinaldi, Esqs.
A full-text copy of the Disclosure Statement dated Oct. 10, 2013,
is available for free at http://bankrupt.com/misc/LICds1010.pdf
LIC Crown Mezz Borrower LLC and its two affiliates sought
protection under Chapter 11 of the Bankruptcy Code (Bankr.
S.D.N.Y. Case No. 13-13304) on Oct. 10, 2013. The Debtors' Chief
Restructuring Officer is Steven A. Carlson.
The Debtors are represented by Klestadt & Winters, LLP, and
Gerstein Strauss & Rinaldi LLP. The Mezzanine Lender is
represented by attorneys at Mintz, Levin, Cohn, Ferris, Glovsky
and Popeo, P.C., in New York; and Greenberg Traurig, LLP, in New
York. Mortgage lender U.S. Bank National Association is
represented by attorneys at Weil, Gotshal & Manges LLP, in New
York.
LIFE CARE: Court Okays Hiring of Moore Stephens as Accountant
-------------------------------------------------------------
Life Care St. Johns, Inc., dba Glenmoor, sought and obtained
permission from the Hon. Jerry A. Funk of the U.S. Bankruptcy
Court for the Middle District of Florida to employ Robert
Matschner, CPA of Moore Stephens Lovelace, P.A. as accountant.
Moore Stephens will prepare Glenmoor's annual audit for 2013, its
annual Medicare Cost Report and its 2013 Form 990 federal income
tax return.
Moore Stephens will charge a fixed fee of $36,000 for preparation
of the 2013 annual audit, the Medicare Cost Report and Glenmoor's
federal Form 990 tax return. The fees will be invoiced and
payable on an interim basis during the progress of our engagement
with any remaining balance due upon delivery of the final product.
An initial deposit of $8,000 will be provided to Moore Stephens
for this engagement. The balance of the fees will be due and
payable in accordance with the following schedule:
Date Amount
---- ------
Jan. 15, 2014 $8,000
Feb. 15, 2014 $7,000
Mar. 15, 2014 $7,000
Apr. 15, 2014 $7,000
Upon earlier of May 15, 2014
or delivery of the reports Balance
For all other services, Moore Stephens will be paid at these
hourly rates:
Senior Partners $325
Staff $100
Moore Stephens will also be reimbursed for reasonable out-of-
pocket expenses incurred.
Robert Matschner, shareholder of Moore Stephens, assured the Court
that the firm is a "disinterested person" as the term is defined
in Section 101(14) of the Bankruptcy Code and does not represent
any interest adverse to the Debtors and their estates.
Moore Stephens can be reached at:
Robert Matschner
MOORE STEPHENS LOVELACE, P.A.
1201 South Orange Avenue, Suite 400
Winter Park, FL
Tel: (407) 740-5400
About Life Care St. Johns
Life Care St. Johns, Inc., filed a Chapter 11 petition (Bankr.
M.D. Fla. Case No. 13-04158) on July 3, 2013. The Debtor is the
owner and operator of a continuing care retirement community known
as Glenmoor consisting of 144 independent living units located on
a 40-acre site in St. Johns County, Florida.
Judge Jerry A. Funk presides over the case. Richard R. Thames,
Esq., and Eric N. McKay, Esq., at Stutsman Thames & Markey, P.A.,
serves as the Debtor's counsel. Navigant Capital Advisors, LLC,
acts as the Debtor's financial advisor. American Legal Claim
Services, LLC, serves as claims and noticing agent.
The Committee of Creditors Holding Unsecured Claims appointed in
the bankruptcy case of Life Care St. Johns, Inc., is represented
by Akerman Senterfitt's David E. Otero, Esq., and Christian P.
George, Esq., in Jacksonville, Florida.
Bruce Jones signed the petition as CEO. The Debtor estimated
assets of at least $10 million and debts of at least $50 million.
LINGENWOOD NORTHWEST: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Lingenwood Northwest, LLC
108 Colonial Oaks Dr
Warner Robins, ga 31088
Case No.: 13-52996
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Middle District of Georgia (Macon)
Debtor's Counsel: Robert Abney Fricks, Esq.
THE FRICKS FIRM, PC
110 Latham Drive, Suite A
Warner Robins, GA 31088
Tel: 478-953-2312
Fax: 478-953-2313
Email: rob@fricksfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Tom Lingenfelter, managing member.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
LONGVIEW POWER: James M. Grady Approved as Chief Financial Officer
------------------------------------------------------------------
Longview Power, LLC, et al., obtained approval from the U.S.
Bankruptcy Court for the District of Delaware to retain Alvarez &
Marsal North America, LLC, to provide the Debtors a deputy chief
financial officer and certain additional personnel. The Court
also approved James M. Grady's designation as deputy chief
financial officer for the Debtors.
As reported in the Troubled Company Reporter on Sept. 25, 2013,
A&M will be paid by the Debtors for the services of the engagement
personnel at their customary hourly billing rates, which are:
Managing Directors $675-$875
Directors $475-$675
Analysts/Associates $275-$475
The firm will also be reimbursed for any necessary out-of-pocket
expenses.
About Longview Power LLC
Longview Power LLC is a special purpose entity created to
construct, own, and operate a 695 MW supercritical pulverized
coal-fired power plant located in Maidsville, West Virginia, just
south of the Pennsylvania border and approximately 70 miles south
of Pittsburgh. The project is owned 92% by First Reserve
Corporation (First Reserve or sponsor), a private equity firm
specializing in energy industry investments, through its affiliate
GenPower Holdings (Delaware), L.P., and 8% by minority interests.
Longview Power, LLC, filed a Chapter 11 (Bank. D. Del. Lead Case.
13-12211) on Aug. 30, 2013. The petitions were signed by Jeffery
L. Keffer, the Company's chief executive officer, president,
treasurer and secretary. The Debtor estimated assets and debts of
more than $1 billion. Judge Brendan Linehan Shannon presides over
the case. Kirkland & Ellis LLP and Richards, Layton & Finger,
P.A., serve as the Debtors' counsel. Lazard Freres & Company LLC
acts as the Debtors' investment bankers. Alvarez & Marsal North
America, LLC, is the Debtors' restructuring advisors. Ernst &
Young serves as the Debtors' accountants. The Debtors' claims
agent is Donlin, Recano & Co. Inc.
Roberta A. DeAngelis, U.S. Trustee for Region 3, disclosed that as
of September 11, 2013, a committee of unsecured creditors has not
been appointed in the case due to insufficient response to the
U.S. Trustee's communication/contact for service on the committee.
METRO AFFILIATES: Case Summary & 30 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor entities filing separate Chapter 11 cases:
Debtor Case No.
------ --------
Metro Affiliates, Inc. 13-13591
7 North Street
Staten Island, NY 10451
Atlantic Express of Missouri, Inc. 13-13592
7 North Street
Staten Island, NY 10302
Amboy Bus Co., Inc. 13-13593
R. Fiore Bus Service, Inc. 13-13594
Atlantic Express of New Jersey, Inc. 13-13595
Courtesy Bus Co., Inc. 13-13596
Raybern Bus Service, Inc. 13-13597
Atlantic Express Transportation Corp. 13-13598
Fiore Bus Service, Inc. 13-13599
Raybern Capital Corp. 13-13600
Atlantic Express of Pennsylvania, Inc. 13-13601
180 Jamaica Corp. 13-13602
Raybern Equity Corp. 13-13603
Atlantic Queens Bus Corp. 13-13604
Groom Transportation, Inc. 13-13605
Atlantic Paratrans of NYC, Inc. 13-13606
Atlantic Escorts, Inc. 13-13607
Robert L. McCarthy & Sons, Inc 13-13608
G.V.D. Leasing, Inc. 13-13609
Staten Island Bus, Inc. 13-13610
Atlantic Paratrans, Inc. 13-13611
Atlantic Express Coachways, Inc. 13-13612
Temporary Transit Service, Inc. 13-13613
Atlantic Transit, Corp. 13-13614
Atlantic Express New England, Inc. 13-13615
James McCarty Limo Services, Inc. 13-13616
Atlantic-Hudson, Inc. 13-13617
Atlantic Express of California, Inc. 13-13618
Atlantic Express of Upstate New York Inc.13-13619
Jersey Business Land Co. Inc. 13-13620
Atlantic Express of Illinois, Inc. 13-13621
TRANSCOMM, INC. 13-13622
Block 7932, Inc. 13-13623
K. Corr, Inc. 13-13624
Brookfield Transit, Inc. 13-13625
Atlantic Express of LA, Inc. 13-13626
Winsale, Inc. 13-13627
Merit Transportation Corp. 13-13628
Metropolitan Escort Service, Inc. 13-13630
Midway Leasing, Inc. 13-13631
Chapter 11 Petition Date: November 4, 2013
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Debtors' Counsel: Lisa G. Beckerman, Esq.
AKIN, GUMP, STRAUSS, HAUER & FELD, LLP
One Bryant Park, 42nd Floor
New York, NY 10036
Tel: (212) 872-1000
Fax: (212) 872-1002
Email: lbeckerman@akingump.com
- and -
Rachel Ehrlich Albanese, Esq.
AKIN STRAUSS HAUER & FELD LLP
One Bryant Park
New York, NY 10036
Tel: 212-872-100
Fax: 212-872-1002
Email: ralbanese@akingump.com
Debtors' Rothschild Inc.
Investment
Banker:
Debtors' Claims Kurtzman Carson Consultants LLC
and Noticing
Agent:
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $1 million to $10 million
The petitions were signed by David J. Carpenter, chief executive
officer.
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Local 1181-1061 Employee Wages $13,114,226
Amalgamated Transit Union and benefits
AFL-CIO
Attn: Richard N. Gilberg
Meyer, Suozzi, English
& Klein, P.C.
1350 Broadway, Ste 501
New York, NY 10018
Tel: 212-239-4999
Fax: 212-239-1311
New York City Board of Trade $2,360,000
Education
Attn: Eric Goldstein
44-36 Vernon Blvd, 6th FL
Long Island City, NY 11101
Tel: 718-707-4399
Fax: 718-472-0615
Bellmore-Merrick CHSD Trade $1,618,610
Attn: Tom Volpe
1260 Meadowbrook Rd
No. Merrick, NY 11566
Tel: 516-992-1024
Fax: 516-623-8911
Empire State Transportation Insurance $1,502,172
Workers Compensation Trust
Attn: Michel Papo
328 State St.
Schenectady, NY 12305
Tel: 866-750-5157
Fax: 518-402-0113
Merrick-U.F.S.D. Trade $830,435
Attn: Debi Watts
21 Babylon Rd
Merrick, NY 11566
Tel: 516-992-7262
Fax: 516-378-3904
Bellmore-U.F.S.D. Trade $353,636
Attn: Patti Minuto &
Joe Hendricson
580 Winthrop Ave
Bellmore, NY 11710
Tel: 516-679-2907
Fax: 516-826-6214
Axel Protection Systems, Inc. Trade $273,134
Attn: George Lawson
90-24 161st St.
Jamaica, NY 11432
Tel: 718-206-4800
Fax: 718-206-2977
Latham & Watkins Professional $255,195
Attn: Robert Zuccaro
PO Box 7247-8181
Philadelphia, PA 19170-8181
Tel: 212-906-1200
Fax: 212-751-4864
Superior Distributors Trade $237,058
Marsh USA Inc. Insurance $233,310
Barnwell House of Tires Trade $219,331
Woodard & Curran Professional $203,773
Greenroad Technologies, Inc. Trade $191,771
Mintz & Gold Professional $150,680
Atlantic Coast Surety, Inc. Surety Bond $138,798
Bus Parts Warehouse Trade $133,809
Riegel Resources, LLC Trade $118,447
National Union Fire Trade $114,929
Insurance Company of
Pittsburgh, PA
Mondial Automotive, Inc. Trade $106,546
Two Twelve Degrees, LLC Trade $95,907
Sarad Marketing Trade $84,839
North East Truck Parts Trade $76,357
Airport Fleet Maintenance Trade $73,778
Kristal Auto Mall Trade $71,396
R.J. McDonald, Inc. Trade $71,083
Able Environmental Services, Inc. Trade $64,373
Donald X. Clavin Taxes $63,514
Northeast Battery & Alternator Trade $63,157
Commercial Truck Tire Center Trade $61,844
ABC Companies Trade $61,663
MEXIA LODGING: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Mexia Lodging LP Mexia Lodging LP
820 W. Milam Street
Mexia, TX 76667
Case No.: 13-35788
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Stacey G. Jernigan
Debtor's Counsel: Rakhee V. Patel, Esq.
SHACKELFORD, MELTON & MCKINLEY LLP
3333 Lee Parkway, Tenth Floor
Dallas, TX 75219
Tel: 214-780-1400
Fax: 214-780-1401
Email: rpatel@shacklaw.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Kamlesh Patel, general partner.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
MF GLOBAL: CME Group to Expedite Customer Payments
--------------------------------------------------
Nathalie Tadena, writing for Daily Bankruptcy Review, reported
that CME Group Inc. said it will help expedite payments to former
customers of collapsed brokerage MF Global Inc., a day after a key
payback to MF Global customers was approved.
According to the report, a bankruptcy judge cleared MF Global on
Nov. 5 to pay back 100% of the money owed to its U.S. and overseas
commodity customers, a watershed moment in the firm's Chapter 11
case.
CME, which both regulated MF Global and charged it fees for
handling the company's trades, said it has reached agreements with
the customer class representatives in the case and James W.
Giddens, the trustee unwinding MF Global's brokerage, to resolve
any claims by or against the exchange operator, the report
related.
CME will be allowed to assert a $29 million claim against MF
Global based on expenses incurred as a result of the firm's
bankruptcy, the report said. The company has agreed to deliver
$14.5 million, or one half of the distribution it will receive
from Mr. Giddens, for distribution to MF Global's former
customers. CME's claim was reserved under a settlement agreement
between CME and Mr. Giddens that allowed the return of more than
$161 million to the trustee.
CME has previously deferred its right to payment of any of its
claims against MF Global until all customer account balance claims
have been paid in full and said that continues to be the case, the
report further related.
About MF Global
New York-based MF Global -- http://www.mfglobal.com/-- was one of
the world's leading brokers of commodities and listed derivatives.
MF Global provides access to more than 70 exchanges around the
world. The firm also was one of 22 primary dealers authorized to
trade U.S. government securities with the Federal Reserve Bank of
New York. MF Global's roots go back nearly 230 years to a sugar
brokerage on the banks of the Thames River in London.
On Oct. 31, 2011, MF Global Holdings Ltd. and MF Global Finance
USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 11-15059 and 11-5058), after a planned sale to
Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF
Global had $41,046,594,000 in total assets and $39,683,915,000 in
total liabilities.
On Nov. 7, 2011, the United States Trustee appointed the statutory
creditors' committee in the Debtors' cases. At the behest of the
Statutory Creditor's Committee, the Court directed the U.S.
Trustee to appoint a chapter 11 trustee. On Nov. 28, 2011, the
Bankruptcy Court entered an order approving the appointment of
Louis J. Freeh, Esq., of Freeh Group International Solutions, LLC,
as Chapter 11 trustee.
On Dec. 19, 2011, MF Global Capital LLC, MF Global Market Services
LLC and MF Global FX Clear LLC filed voluntary Chapter 11
petitions (Bankr. S.D.N.Y. Case Nos. 11-15808, 11-15809 and
11-15810). On Dec. 27, the Court entered an order installing Mr.
Freeh as Chapter 11 Trustee of the New Debtors.
On March 2, 2012, MF Global Holdings USA Inc. filed a voluntary
Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-10863), and Mr.
Freeh also was installed as its Chapter 11 Trustee.
Judge Honorable Martin Glenn presides over the Chapter 11 case.
J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric
Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve
as bankruptcy counsel. The Garden City Group, Inc., serves as
claims and noticing agent. The petition was signed by Bradley I.
Abelow, Executive Vice President and Chief Executive Officer of MF
Global Finance USA Inc.
The Chapter 11 Trustee has tapped (i) Freeh Sporkin & Sullivan
LLP, as investigative counsel; (ii) FTI Consulting Inc., as
restructuring advisors; (iii) Morrison & Foerster LLP, as
bankruptcy counsel; and (iv) Pepper Hamilton as special counsel.
The Official Committee of Unsecured Creditors has retained
Capstone Advisory Group LLC as financial advisor, while lawyers at
Proskauer Rose LLP serve as counsel.
The Securities Investor Protection Corporation commenced
liquidation proceedings against MF Global Inc. to protect
customers. James W. Giddens was appointed as trustee pursuant to
the Securities Investor Protection Act. He is a partner at Hughes
Hubbard & Reed LLP in New York.
Jon Corzine, the former New Jersey governor and co-CEO of
Goldman Sachs Group Inc., stepped down as chairman and chief
executive officer of MF Global just days after the bankruptcy
filing.
In April 2013, the Bankruptcy Court approved MF Global Holdings'
plan to liquidate its assets. Bloomberg News reported that the
court-approved disclosure statement initially told
creditors with $1.134 billion in unsecured claims against the
parent holding company why they could expect a recovery of 13.4%
to 39.1% from the plan. As a consequence of a settlement with
JPMorgan, supplemental materials informed unsecured creditors
their recovery was reduced to the range of 11.4% to 34.4%. Bank
lenders will have the same recovery on their $1.174 billion claim
against the holding company. As a consequence of the settlement,
the predicted recovery became 18% to 41.5% for holders of $1.19
billion in unsecured claims against the finance subsidiary,
one of the companies under the umbrella of the holding company
trustee. Previously, the predicted recovery was 14.7% to 34% on
bank lenders' claims against the finance subsidiary.
MF GLOBAL: Trustee Can Distribute 100% of Customer Funds
--------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that MF Global Inc.'s
trustee will get court approval to complete distributions to
former customers of the failed brokerage, allowing all missing
funds to be returned by the end of the year.
According to the report, U.S. Bankruptcy Judge Martin Glenn said
on Nov. 5 he's prepared to approve a plan to make the final
determination of what 26,000 former customers are owed and
distribute the money to them. The motion will ensure customers are
paid by Dec. 31, satisfying all claims more than two years after
the brokerage failed.
"That's quite an accomplishment," Judge Glenn said at a hearing
on Nov. 5 in Manhattan. At the outset of the case, nobody thought
that customers would recover everything they lost, he said.
The trustee, James Giddens, marshaled more than $5.3 billion in
assets from MF Global's former exchanges and depositaries, which
he said were clearly customer property. He has already made
interim distributions to customers. The final distributions will
require him to advance funds from the company's general bankruptcy
estate.
Determining what customers are owed will establish the size of the
estate for general creditors, allowing them to be repaid as well,
Giddens told Judge Glenn, adding that $3 billion in customer
claims have yet to be resolved.
About MF Global
New York-based MF Global -- http://www.mfglobal.com/-- was one of
the world's leading brokers of commodities and listed derivatives.
MF Global provides access to more than 70 exchanges around the
world. The firm also was one of 22 primary dealers authorized to
trade U.S. government securities with the Federal Reserve Bank of
New York. MF Global's roots go back nearly 230 years to a sugar
brokerage on the banks of the Thames River in London.
On Oct. 31, 2011, MF Global Holdings Ltd. and MF Global Finance
USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 11-15059 and 11-5058), after a planned sale to
Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF
Global had $41,046,594,000 in total assets and $39,683,915,000 in
total liabilities.
On Nov. 7, 2011, the United States Trustee appointed the statutory
creditors' committee in the Debtors' cases. At the behest of the
Statutory Creditor's Committee, the Court directed the U.S.
Trustee to appoint a chapter 11 trustee. On Nov. 28, 2011, the
Bankruptcy Court entered an order approving the appointment of
Louis J. Freeh, Esq., of Freeh Group International Solutions, LLC,
as Chapter 11 trustee.
On Dec. 19, 2011, MF Global Capital LLC, MF Global Market Services
LLC and MF Global FX Clear LLC filed voluntary Chapter 11
petitions (Bankr. S.D.N.Y. Case Nos. 11-15808, 11-15809 and
11-15810). On Dec. 27, the Court entered an order installing Mr.
Freeh as Chapter 11 Trustee of the New Debtors.
On March 2, 2012, MF Global Holdings USA Inc. filed a voluntary
Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-10863), and Mr.
Freeh also was installed as its Chapter 11 Trustee.
Judge Honorable Martin Glenn presides over the Chapter 11 case.
J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric
Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve
as bankruptcy counsel. The Garden City Group, Inc., serves as
claims and noticing agent. The petition was signed by Bradley I.
Abelow, Executive Vice President and Chief Executive Officer of MF
Global Finance USA Inc.
The Chapter 11 Trustee has tapped (i) Freeh Sporkin & Sullivan
LLP, as investigative counsel; (ii) FTI Consulting Inc., as
restructuring advisors; (iii) Morrison & Foerster LLP, as
bankruptcy counsel; and (iv) Pepper Hamilton as special counsel.
The Official Committee of Unsecured Creditors has retained
Capstone Advisory Group LLC as financial advisor, while lawyers at
Proskauer Rose LLP serve as counsel.
The Securities Investor Protection Corporation commenced
liquidation proceedings against MF Global Inc. to protect
customers. James W. Giddens was appointed as trustee pursuant to
the Securities Investor Protection Act. He is a partner at Hughes
Hubbard & Reed LLP in New York.
Jon Corzine, the former New Jersey governor and co-CEO of
Goldman Sachs Group Inc., stepped down as chairman and chief
executive officer of MF Global just days after the bankruptcy
filing.
In April 2013, the Bankruptcy Court approved MF Global Holdings'
plan to liquidate its assets. Bloomberg News reported that the
court-approved disclosure statement initially told
creditors with $1.134 billion in unsecured claims against the
parent holding company why they could expect a recovery of 13.4%
to 39.1% from the plan. As a consequence of a settlement with
JPMorgan, supplemental materials informed unsecured creditors
their recovery was reduced to the range of 11.4% to 34.4%. Bank
lenders will have the same recovery on their $1.174 billion claim
against the holding company. As a consequence of the settlement,
the predicted recovery became 18% to 41.5% for holders of $1.19
billion in unsecured claims against the finance subsidiary,
one of the companies under the umbrella of the holding company
trustee. Previously, the predicted recovery was 14.7% to 34% on
bank lenders' claims against the finance subsidiary.
MILLER HEIMAN: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned Reno, Nevada-based
corporate sales training provider Miller Heiman Inc. a 'B'
corporate credit rating. The outlook is stable.
At the same time, S&P assigned Miller Heiman's $273 million senior
secured credit facility its issue-level rating of 'B' (at the same
level as the corporate credit rating), with a recovery rating of
'3', indicating S&P's expectation for meaningful (50%-70%)
recovery for lenders in the event of a payment default. The
facility consists of a $233 million term loan due 2019 and a
$40 million revolving credit facility due 2018.
The company used proceeds, along with $65 million in unrated,
increasing-rate pay-in-kind (PIK) subordinated notes due 2020, to
fund Miller Heiman's $165 million acquisition of Informa
Performance Improvement (IPI), the business training segment of
Informa Plc, and to refinance existing debt. The debt was put in
place in November 2012, when Providence Equity Partners acquired
Miller Heiman for $205 million.
"The 'B' corporate credit rating on Miller Heiman reflects our
expectation that the company will be able to gradually reduce its
heightened leverage and maintain an adequate cushion of covenant
compliance over the intermediate term," said Standard & Poor's
credit analyst Hal Diamond.
S&P considers the company's business risk profile "weak" because
of Miller Heiman's rapid acquisition-driven growth and the
potential execution risk of effectively integrating and improving
the operating performance of the underperforming acquisition of
lower-margined IPI. IPI doubles the EBITDA of the company. S&P
views Miller Heiman's financial risk profile as "highly leveraged"
based on its private-equity ownership and substantial debt
leverage. S&P assess the company's management and governance as
"fair."
MT. LAUREL LODGING: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor entities filing separate Chapter 11 cases:
Debtor Case No.
------ --------
Mt. Laurel Lodging Associates, LLP 13-11697
5701 Progress Road
Indianapolis, IN 46241
Ontario Lodging Associates, LLC 13-11712
Riverside Lodging Associates, LLC 13-11714
Rosenburg Lodging Associates, LLP 13-11709
Tampa Palms Lodging Associates, LLP 13-11716
Titusville Lodging Associates, LLP 13-11720
Conroe Lodging Associates, LLP 13-11705
Chapter 11 Petition Date: November 4, 2013
Court: United States Bankruptcy Court
Southern District of Indiana (Indianapolis)
Judge: Hon. Robyn L. Moberly
Debtor's Counsel: Brian A Audette, Esq.
PERKINS COIE LLP
131 S Dearborn St, Ste 1700
Chicago, IL 60603-5559
Tel: 312-824-8534
Email: baudette@perkinscoie.com
- and -
Andrew T Kight, Esq.
TAFT, STETTINIUS & HOLLISTER LLP
One Indiana Square, Suite 3500
Indianapolis, IN 46204
Tel: (317) 713-3500
Fax: (317) 713-3699
Email: akight@taftlaw.com
- and -
David M Neff, Esq.
PERKINS COIE LLP
131 S Dearborn St, Ste 1700
Chicago, IL 60603-5559
Email: dneff@perkinscoie.com
- and -
Michael P. O'Neil, Esq.
TAFT STETTINIUS & HOLLISTER LLP
1 Indiana Square, Suite 3500
Indianapolis, IN 46204
Tel: 317-713-3500
Email: moneil@taftlaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petitions were signed by Bharat Patel, general partner.
A. List of Mt. Laurel's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
AC Schultes, Inc. $23,760
Sysco $11,790
Thurston Rhodes $8,250
Carfaro, Inc., c/o Antwan $6,704
PSEG $4,941
HD Supply Facilities $4,635
Quality Construction $4,025
D Corino $3,937
Katz Sapper & Miller $3,275
Guest Supply $3,193
GPM Associates $2,420
World Cinema $2,027
Hutchinson $1,801
Specialized Architectural Products $1,669
Kone Elevator $1,410
Uniquest $1,295
JMA Landscaping $1,273
Dobil $1,230
Feldman Lumber $981
Wegman's $963
B. List of Conroe Lodging's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Access Point Financial, Inc. Loan $3,600,000
Attn Denise Arnold, Sr VP
1 Ravinia Dr, Ste 900
Atlanta, GA 30346
Sysco $5,197
Katz, Sapper & Miller $3,275
American Hotel Register $3,228
Kone Elevator $2,391
World Cinema Inc $1,974
Ecolab $1,221
Royal Cup $748
Chris Johnson Wallpaper Hanging $700
Muzak LLC $672
Home Depot Supply $585
Scardino Landscaping $555
Ethostream $504
Corporation Service Company $472
Orkin Pest Control $445
USA Today $336
Toner Cartridge Direct $309
AS Hospitality $237
Heartland Food Products $210
TW Telecom $191
NESBITT PORTLAND: Seeks Approval of $166-Mil. Sale
--------------------------------------------------
Law360 reported that the chief restructuring officer for a group
of bankrupt Embassy Suites hotel operators asked a California
judge on Nov. 1 to approve a $166.3 million hotel sale to a joint
venture of BlueMountain Capital Management LLC unit and an
affiliate of AWH Partners LLC.
According to the report, the portfolio of eight hotels is being
purchased by shell company ES Feeholder LLC, which came out with
the best bid in a recent auction, chief restructuring officer and
Odyssey Capital Group LLC managing partner Grant Lyon said in a
motion to approve the sale.
About Nesbitt Portland Property et al.
Windsor Capital Group Inc. CEO Patrick M. Nesbitt sent hotel-
companies to Chapter 11 bankruptcy to stop a receiver named by
U.S. Bank National Association from taking over eight hotels,
seven of which are operated as Embassy Suites brand hotels. The
eighth hotel, located in El Paso, Texas, was previously operated
as an Embassy Suites hotel, but lost its franchise agreement.
The eight hotels were pledged by the Debtors as collateral for the
loans with U.S. Bank.
According to http://www.wcghotels.com/Santa Monica-based Windsor
Capital owns and/or operates 23 branded hotels in 11 states across
the U.S. Windsor Capital is the largest private owner and
operator of Embassy Suites hotels.
In the case U.S. Bank vs. Nesbitt Bellevue Property LLC, et al.
(S.D.N.Y. 12 Civ. 423), U.S. Bank obtained approval from the
district judge in June to name Alan Tantleff of FTI Consulting,
Inc., as receiver for:
* Embassy Suites Colorado Springs in Colorado;
* Embassy Suites Denver Southeast in Colorado;
* Embassy Suites Cincinnati - Northeast in Blue Ash, Ohio;
* Embassy Suites Portland - Washington Square in Tigard, Oregon;
* Embassy Suites Detroit - Livornia/Novi in Michigan;
* Embassy Suites El Paso in Texas;
* Embassy Suites Seattle - North/Lynwood in Washington; and
* Embassy Suites Seattle - Bellevue in Washington
The receiver obtained district court permission to engage Crescent
Hotels and Resorts LLC to manage the eight hotels. But before Mr.
Adam could take physical possession of the properties and take
control of the Hotels, the eight borrowers filed Chapter 11
petitions (Bankr. C.D. Cal. Lead Case No. 12-12883) on
July 31, 2012, in Santa Barbara, California.
The debtor-entities are Nesbitt Portland Property LLC; Nesbitt
Bellevue Property LLC; Nesbitt El Paso Property, L.P.; Nesbitt
Denver Property LLC; Nesbitt Lynnwood Property LLC; Nesbitt
Colorado Springs Property LLC; Nesbitt Livonia Property LLC; and
Nesbitt Blue Ash Property LLC.
Bankruptcy Judge Robin Riblet presides over the cases. The
Jonathan Gura, Esq., and Peter Susi, Esq., at Susi & Gura, PC; and
Joseph M. Sholder, Esq., at Griffith & Thornburgh LLP, represent
the Debtor as counsel. Alvarez & Marsal North American, LLC,
serves as financial advisors.
Attorneys at Kilpatrick Townsend & Stockton LLP represented the
Debtors in the receivership case.
U.S. Bank National Association, as Trustee and Successor in
Interest to Bank of America, N.A., as Trustee for Registered
Holders of GS Mortgage Securities Corporation II, Commercial
Mortgage Passthrough Certificates, Series 2006-GG6, acting by and
through Torchlight Loan Services, LLC, as special servicer, are
represented in the case by David Weinstein, Esq., and Lawrence P.
Gottesman, Esq., at Bryan Cave LLP.
On Sept. 5, 2012, the Debtors filed with the Court their schedules
of assets and liabilities. Nesbitt Portland scheduled
$29.4 million in assets and $192.3 million in liabilities.
Nesbitt Portland's hotel property is valued at $27.19 million, and
secures a $191.9 million debt to U.S. Bank.
NEW LIFE FELLOWSHIP: Involuntary Chapter 11 Case Summary
--------------------------------------------------------
Alleged Debtor: New Life Fellowship Church of Lancaster
1020 W Beltline Rd.
Lancaster, TX 75146
Case Number: 13-45124
Involuntary Chapter 11 Petition Date: November 4, 2013
Court: United States Bankruptcy Court
Northern District of Texas (Ft. Worth)
Judge: Hon. Michael Lynn
Petitioners' Counsel: Kevin S. Wiley, Jr., Esq.
LAW OFFICES OF KEVIN S. WILEY JR.
2700 Fairmount Street, Suite 120
Dallas, TX 75201
Tel: (469) 619-5721
Fax: (469) 619-5725
Email: kevinwiley@lkswjr.com
Alleged Debtor's petitioners:
Petitioner Nature of Claim Claim Amount
---------- --------------- ------------
New Mount Zion Baptist Church Promissory Note $300,000
9550 Shepherd Road
Dallas, TX 75243
Michael P O'Donnell Legal Services $7,000
3450 Hulen Street
Fort Worth, TX 76017
Tommy King Services Performed $800
9550 Shepherd Road
Dallas, TX 75243
NIRVANIX INC: Hires Arch & Beam as Financial Advisor
----------------------------------------------------
Nirvanix, Inc. seeks permission from the U.S. Bankruptcy Court for
the District of Delaware to employ Arch & Beam Global, LLC as
financial advisor, nunc pro tunc to Oct. 1, 2013.
The Debtor requires Arch & Beam to:
(a) assist in the development of the Debtor's Chapter 11 wind-
down plan;
(b) assist with the preparation of necessary schedules, budgets
and court related reporting;
(c) analyze various wind-down scenarios and potential impact of
these scenarios on the recoveries of those stakeholders
impacted by the wind-down of the Debtor's operations;
(d) participate in negotiation among the Debtor and its
creditors, suppliers, landlords, and other parties in
interest;
(e) assist the Debtor in preparing marketing materials in
conjunction with the sale or liquidation of the Debtor's
assets;
(f) assist the Debtor in populating and maintaining an
electronic data room;
(g) assist the Debtor in coordinating site visits for
interested buyers and work with the management team to
develop appropriate presentations for such visits; and
(h) provide such other advisory services as customarily
provided in connection with these proceedings under
Chapter 11 of the Bankruptcy Code.
Arch & Beam will be paid at these hourly rates:
Managing Directors $375
Directors $325
Associates $175-$250
Staff and Admin Services $75-$100
Arch & Beam will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Prior to the petition date, Arch & Beam received a retainer from
the Debtor in the amount of $100,000 from which $41,831.57 was
drawn for the payment of Arch & Beam's prepetition fees and
expenses.
Matthew English, managing director of Arch & Beam, assured the
Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtors and their estates.
Arch & Beam can be reached at:
Matthew English
ARCH & BEAM GLOBAL, LLC
2500 Camino Diablo, Suite 108
Walnut Creek, CA 94597
Tel: (415) 252-2900
Fax: (650) 240-1405
E-mail: matthew.english@archbeamadvisors.com
About Nirvanix, Inc.
Cloud storage company Nirvanix, Inc., based in San Diego,
California, sought protection under Chapter 11 of the Bankruptcy
Code on Oct. 1, 2013 (Case No. 13-12595, Bankr. D.Del.). The case
is assigned to Judge Brendan Linehan Shannon.
The Debtor is represented by Norman L. Pernick, Esq., Marion M.
Quirk, Esq., and Patrick J. Reilley, Esq., at COLE, SCHOTZ,
MEISEL, FORMAN & LEONARD, PA. Cooley LLP serves as the Debtor's
special corporate counsel. Arch & Beam Global LLC serves as the
Debtor's financial advisor. Epiq Systems Inc. is the Debtor's
claims and noticing agent.
The Debtor disclosed estimated assets of $10 million to $50
million and estimated debts of $10 million to $50 million.
The petition was signed by Debra Chrapaty, CEO.
NIRVANIX INC: Taps Cole Schotz as Bankruptcy Counsel
----------------------------------------------------
Nirvanix, Inc. seeks permission from the U.S. Bankruptcy Court for
the District of Delaware to employ Cole, Schotz, Meisel, Forman &
Leonard, P.A. as general reorganization and bankruptcy counsel,
nunc pro tunc to Oct. 1, 2013.
The Debtor requires Cole Schotz to:
(a) advise the Debtor of its rights, powers and duties as
debtor-in-possessions;
(b) advise the Debtor regarding matters of bankruptcy law;
(c) represent the Debtor in proceedings and hearings in the
U.S. Bankruptcy Court for the District of Delaware;
(d) prepare on behalf of the Debtor any necessary motions,
applications, orders, responses and other legal papers;
(e) advise the Debtor concerning and assist in the negotiations
and documentation of, financing agreements, cash collateral
arrangements, sale agreements and related transactions;
(f) provide assistance, advice and representation concerning
any further investigation of the assets, liabilities, and
financial condition of the Debtor that may be required
under local, state, or federal law;
(g) prosecute and defend litigation matters and such other
matters that might arise during this Chapter 11 case; and
(h) perform such other legal services as may be necessary and
appropriate for the efficient and economical administration
of this Chapter 11 case.
Cole Schotz will be paid at these hourly rates:
Members and Special Counsel $375-$800
Associates $195-$420
Paralegals $170-$250
Cole Schotz will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Cole Schotz received an initial retainer from the Debtor in the
amount of $50,000 and a second retainer of $75,000, for the
planning, preparation of documents and its proposed post-petition
representation of the Debtor. The initial retainer was provided
by Khosla Ventures IV LP on the Debtor's behalf. Of the initial
retainer and second retainer amounts, $67,585.50 was applied to
pay pre-petition fees and expenses incidental to the preparation
and filing of this case and the petition filing fee. The
remaining $57,414.50 constitutes a general or "evergreen" retainer
as security for Cole Schotz's post-petition services.
Patrick J. Reilley, Esq., member of Cole Schotz, assured the Court
that the firm is a "disinterested person" as the term is defined
in Section 101(14) of the Bankruptcy Code and does not represent
any interest adverse to the Debtors and their estates.
Cole Schotz can be reached at:
Patrick J. Reilley, Esq.
COLE, SCHOTZ, MEISEL, FORMAN & LEONARD, P.A.
500 Delaware Avenue, Suite 1410
Wilmington, DE 19801
Tel: (302) 651-2004
Fax: (302) 574-2104
E-mail: preilley@coleschotz.com
About Nirvanix, Inc.
Cloud storage company Nirvanix, Inc., based in San Diego,
California, sought protection under Chapter 11 of the Bankruptcy
Code on Oct. 1, 2013 (Case No. 13-12595, Bankr. D.Del.). The case
is assigned to Judge Brendan Linehan Shannon.
The Debtor is represented by Norman L. Pernick, Esq., Marion M.
Quirk, Esq., and Patrick J. Reilley, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, PA. Cooley LLP serves as the Debtor's
special corporate counsel. Arch & Beam Global LLC serves as the
Debtor's financial advisor. Epiq Systems Inc. is the Debtor's
claims and noticing agent.
The Debtor disclosed estimated assets of $10 million to $50
million and estimated debts of $10 million to $50 million.
The petition was signed by Debra Chrapaty, CEO.
NIRVANIX INC: Hires Cooley LLP as Corporate Counsel
---------------------------------------------------
Nirvanix, Inc. asks for permission from the U.S. Bankruptcy Court
for the District of Delaware to employ Cooley LLP as special
corporate counsel, nunc pro tunc to Oct. 1, 2013.
The Debtor seeks to retain Cooley LLP as its special corporate
counsel to continue representing the Debtor with respect to
certain corporate matters, including, principally, assisting the
Debtor in the sale of substantially all of its assets pursuant to
section 363 of the Bankruptcy Code, general corporate matters,
employment issues and collecting accounts from customers,
collectively, the "327(e)Matters".
The Debtor requires Cooley LLP to:
(a) assist in the marketing of the Debtor's assets;
(b) assist the Debtor in negotiating and analyzing bids from
potential buyers;
(c) draft all sale related documents;
(d) conduct one or more auctions, as may be required for the
Debtor's assets;
(e) assist the Debtor in closing the sale;
(f) advise the Debtor with regard to general employment and
employment retention issues;
(g) assist the Debtor with collecting accounts receivable from
customers and customer relations matters; and
(h) advise the Debtor with regard to corporate governance
issues throughout the sale process and the wind-down of the
Debtor's estate.
Cooley LLP will be paid at these hourly rates:
Kenneth Guernsey $1,020
Keith McDaniels $695
Lesley Kroupa $640
Christopher Yamaoka $585
Cooley LLP will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Keith McDaniels, Esq., partner at Cooley LLP, assured the Court
that the firm is a "disinterested person" as the term is defined
in Section 101(14) of the Bankruptcy Code and does not represent
any interest adverse to the Debtors and their estates.
Cooley LLP can be reached at:
Keith McDaniels, Esq.
COOLEY LLP
101 California Street, 5th Floor
San Francisco, CA 94111-5800
Tel: 415-693-2080
Fax: 415-693-2222
E-mail: kmcdaniels@cooley.com
About Nirvanix, Inc.
Cloud storage company Nirvanix, Inc., based in San Diego,
California, sought protection under Chapter 11 of the Bankruptcy
Code on Oct. 1, 2013 (Case No. 13-12595, Bankr. D.Del.). The case
is assigned to Judge Brendan Linehan Shannon.
The Debtor is represented by Norman L. Pernick, Esq., Marion M.
Quirk, Esq., and Patrick J. Reilley, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, PA. Cooley LLP serves as the Debtor's
special corporate counsel. Arch & Beam Global LLC serves as the
Debtor's financial advisor. Epiq Systems Inc. is the Debtor's
claims and noticing agent.
The Debtor disclosed estimated assets of $10 million to $50
million and estimated debts of $10 million to $50 million.
The petition was signed by Debra Chrapaty, CEO.
NIRVANIX INC: Wants Schedules Filing Deadline Moved to Nov. 15
--------------------------------------------------------------
Nirvanix, Inc., filed a motion with the U.S. Bankruptcy Court
seeking to extend the deadline to file its schedules of assets and
liabilities, and statement of financial affairs to Nov. 15, 2013.
The Debtor said there is no sufficient time or resources to
complete the Schedules and Statements by the current filing
deadline, and rather than filing incomplete documents that would
require amendments at a later date, the Debtor seeks an extension
to complete the task.
Meanwhile, a meeting of creditors pursuant to Sec. 341 of the
Bankruptcy Code was set for Nov. 5.
Proposed Counsel to the Debtor can be reached at:
Norman L. Pernick, Esq.
Marion M. Quirk, Esq.
Patrick J. Reilley, Esq.
COLE, SCHOTZ, MEISEL, FORMAN & LEONARD, P.A.
500 Delaware Avenue, Suite 1410
Wilmington, DE 19801
Tel: (302) 652-3131
Fax: (302) 652-3117
About Nirvanix, Inc.
Cloud storage company Nirvanix, Inc., based in San Diego,
California, sought protection under Chapter 11 of the Bankruptcy
Code on Oct. 1, 2013 (Case No. 13-12595, Bankr. D.Del.). The case
is assigned to Judge Brendan Linehan Shannon.
The Debtor is represented by Norman L. Pernick, Esq., Marion M.
Quirk, Esq., and Patrick J. Reilley, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, PA. Cooley LLP serves as the Debtor's
special corporate counsel. Arch & Beam Global LLC serves as the
Debtor's financial advisor. Epiq Systems Inc. is the Debtor's
claims and noticing agent.
The Debtor disclosed estimated assets of $10 million to $50
million and estimated debts of $10 million to $50 million.
The petition was signed by Debra Chrapaty, CEO.
NNN 123: Sec. 341 Creditors' Meeting Set for Nov. 20
----------------------------------------------------
The U.S. Trustee 3 will convene a meeting of creditors pursuant to
11 U.S.C. 341(a) in the Chapter 11 case of NNN 123 North Wacker,
LLC on Nov. 20, 2013, at 3:00 p.m. The meeting will be held at
219 South Dearborn, Office of the U.S. Trustee, 8th Floor, Room
804, Chicago, Illinois 60604.
NNN 123 North Wacker, LLC, filed a Chapter 11 petition (Bankr.
N.D. Ill. Case No. 13-39210) on Oct. 4, 2013 in Chicago,
represented by Andrea Johnson Frost, Esq., at Kaye Scholer LLC, as
counsel. The Debtor estimated $10 million to $50 million in
assets and $100 million to $500 million in liabilities.
Another entity, NNN 123 North Wacker Member, LLC, sought Chapter
11 protection (Case No. 13-39240) on the same day.
NNN 123: TIC Members Seek Case Dismissal
----------------------------------------
NNN 123 North Wacker 1 LLC and other tenants in common (TIC
Members), who owns over 86% of the property that constitutes the
only significant asset of debtor NNN 123 North Wacker LLC, filed a
motion with the U.S. Bankruptcy Court seeking to dismiss the
chapter 11 case.
The TIC Members are 34 single purpose limited liability companies
that, along with the Debtor, hold an undivided fee interest as
common law tenants in common in an office building located at 123
North Wacker Drive, Chicago, Illinois. The TIC Members, along
with the Debtor, are jointly and severally liable on more than
$134 million in loans that were advanced by General Electric
Capital Corporation to purchase the property in 2005 and which
loans are now securitized.
The TIC Members had been working cooperatively with the Master
Service of the Loans in an effort to develop a strategy to
restructure the Loans and to infuse additional capital into the
property when they learned of the Debtor's bankruptcy filing.
The Debtor, however, did not participate in the TIC members'
restructuring. The TIC Members have had a strained relationship
with the Debtor's principals.
According to the Dismissal Motion, the Chapter 11 case must be
dismissed on these reasons:
a. The petition was filed in bad faith
The Debtor has not articulated any good faith basis for filing the
within case and, considering that no default had even been called
by the Lender at the time of the filing and no enforcement efforts
were undertaken, no basis existed for the filing.
b. The case should be dismissed rather than converted
Dismissal, rather than conversion, is appropriate and in the best
interest of creditors and the estate because there are no assets
available for distribution to unsecured creditors in the event of
conversion.
Hearing on the Dismissal Motion is scheduled for Nov. 21, 2013, at
10:30 a.m.
Counsel for TIC Members can be reached at:
Emily Stone, Esq.
Bernard R. Given, II, Esq.
Vadim J. Rubinstein, Esq.
LOEB & LOEB LLP
NNN 123 North Wacker, LLC, filed a Chapter 11 petition (Bankr.
N.D. Ill. Case No. 13-39210) on Oct. 4, 2013 in Chicago,
represented by Andrea Johnson Frost, Esq., at Kaye Scholer LLC, as
counsel. The Debtor estimated $10 million to $50 million in
assets and $100 million to $500 million in liabilities.
Another entity, NNN 123 North Wacker Member, LLC, sought Chapter
11 protection (Case No. 13-39240) on the same day.
NNN 123: Plan and Disclosure Statement Due Feb. 6
-------------------------------------------------
According to documents filed in the Chapter 11 case of NNN 123
North Wacker LLC, the Debtor must file its Plan and Disclosure
Statement not later than Feb. 6, 2014.
NNN 123 North Wacker, LLC, filed a Chapter 11 petition (Bankr.
N.D. Ill. Case No. 13-39210) on Oct. 4, 2013 in Chicago,
represented by Andrea Johnson Frost, Esq., at Kaye Scholer LLC, as
counsel. The Debtor estimated $10 million to $50 million in
assets and $100 million to $500 million in liabilities.
Another entity, NNN 123 North Wacker Member, LLC, sought Chapter
11 protection (Case No. 13-39240) on the same day.
OFP SELF STORAGE: Case Summary & 2 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: OFP Self Storage, LP
5917 Sherry Lane
Dallas, TX 75225
Case No.: 13-42698
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Eastern District of Texas (Sherman)
Judge: Hon. Brenda T. Rhoades
Debtor's Counsel: Frank J. Wright, Esq.
WRIGHT GINSBERG BRUSILOW P.C.
600 Signature Place
14755 Preston Road
Dallas, TX 75254
Tel: 972-788-1600
Email: bankruptcy@wgblawfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
A list of the Debtor's two largest unsecured creditors is
available for free at http://bankrupt.com/misc/txeb13-42698.pdf
OHANA GROUP: To Present Plan for Confirmation in December
---------------------------------------------------------
The Ohana Group LLC may now begin soliciting votes for its
Chapter 11 plan and is slated to present the plan for confirmation
in December after it obtained approval of the explanatory
disclosure statement.
U.S. Bankruptcy Judge Marc Barreca in an order entered Oct. 31,
2013, ruled, "The Disclosure Statement contains information of a
kind, and in sufficient detail, as far as is reasonably
practicable under the circumstances, that would enable a
hypothetical reasonable investor to make an informed judgment
about the plan."
All ballots accepting or rejecting the Plan will be served on
counsel for the Debtor no later than Dec. 2, 2013. Any objections
to confirmation of the Plan will be in writing, filed with the
Court, and served on counsel for the Debtor no later than Dec. 2,
2013.
An evidentiary hearing will be held commencing on Dec. 9, 2013 at
9:30 a.m. and continuing on Dec. 10, 2013 at 9:30 a.m., for the
Court's consideration of confirmation of the Debtor's Plan.
Disclosure Objections
Wells Fargo Bank, N.A., the secured lender, conveyed objections to
the Disclosure Statement.
Following a hearing on Oct. 11, 2013, the court ordered the Debtor
to file an amended disclosure statement to address concerns raised
by Wells Fargo. On Oct. 22, the Debtor filed its revised First
Amended Disclosure Statement. Wells Fargo said that the Revised
Disclosure Statement, still failed to adequately address, among
other things:
-- 90-day comparison of cash vs. accrual accounting;
-- actual rents paid by the Health Club vs. those required under
the lease;
-- impact of the Health Club default on feasibility; and
-- fraudulent transfer claims related to the modification of the
Health Club lease.
"The lender again continues to offer confirmation objections in
connection with seeking to re-write the Debtor's disclosure
statement. It will certainly have a full opportunity to contest
confirmation at the appropriate time," the Debtor said in its
response to the objection. A copy of the document is available
for free at: http://bankrupt.com/misc/Ohana_DS_Obj_Response.pdf
Wells Fargo, as trustee for the registered holders of Credit
Suisse First Boston Mortgage Securities Corp. Commercial Mortgage
Pass-Through Certificates Series 2007-C5, is represented by:
Charles R. Ekberg, Esq.
LANE POWELL PC
1420 5th Ave # 4100, Seattle, WA 98101
Tel: (206) 223-7012
- and -
Kyle J. Mathews, Esq.
Alan M. Feld, Esq.
SHEPPARD, MULLIN, RICHTER & HAMPTON LLP
The Plan
Under the proposed Plan, the Debtor will continue to operate the
Fremont Village Square condominium development Project in the
ordinary course of business. Funding for payments to creditors
under the Plan will come from Cash on hand as of the Effective
Date, and operating revenues.
The Plan provides that the secured claim of Wells Fargo, which
filed a proof of claim of $13,434,336 on Jan. 25, 2013, will be
satisfied through equal monthly principal and interest payments
based upon a 30-year amortization schedule. Holders of general
unsecured claims will be paid in full in 12 equal monthly
payments. Members will retain their interests.
About Ohana Group LLC
Ohana Group LLC, is a Washing limited liability company formed in
2006 for the purpose of managing and operating a mixed-used real
property development located at 3601 Fremont Avenue N. in Seattle,
Washington. The Company filed for Chapter 11 bankruptcy (Bankr.
W.D. Wash. Case No. 12-21904) on Nov. 30, 2012. The Debtor's
members are Patricia Cawdrey and Daniel Cawdrey, Jr. Judge Marc
Barreca oversees the case. James I. Day, Esq., at Bush Strout &
Kornfeld LLP, in Seattle, serves as bankruptcy counsel. The Law
Offices of Brian H. Krikorian represents the Debtor as special
counsel in connection with the litigation against one of the
Debtor's former tenants. In its petition, the Debtor scheduled
$16,000,000 in assets and $11,696,131 in liabilities.
OPEN TEXT: Moody's Places 'Ba1' CFR Under Review for Downgrade
--------------------------------------------------------------
Moody's Investors Service placed Open Text Corp.'s ratings
including its Ba1 corporate family rating ("CFR") under review for
downgrade. The review was prompted by the company's recent
announcement of the partially debt financed acquisition of GXS
Group, Inc. and the relative scale of the acquisition relative to
Open Text. GXS Group is the parent of B2B messaging service
provider GXS Worldwide Inc. (CFR B2, stable). GXS's existing debt
is expected to be repaid as part of the transaction at which
point, GXS 's ratings, including GXS Worldwide Inc.'s B2 corporate
family rating will be withdrawn.
Ratings Rationale:
Open Text announced a definitive agreement to acquire GXS for
approximately $1.2 billion to be financed with $800 million of
debt, equity and cash on hand. The review will focus on the
strategic rationale and integration risks of the acquisition as
well as the terms of the financing, final capital structure and
debt repayment plans. Though Open Text's Ba1 corporate family
rating accommodates a certain amount of debt financed
acquisitions, the GXS transaction is larger than originally
contemplated in the rating. The ratings could be confirmed at Ba1
or downgraded, however a downgrade, if any would likely be limited
to one notch.
On Review for Downgrade:
Issuer: Open Text Corp.
Probability of Default Rating, Placed on Review for Downgrade,
currently Ba2-PD
Corporate Family Rating, Placed on Review for Downgrade,
currently Ba1
Senior Secured Bank Credit Facility Nov 9, 2016, Placed on
Review for Downgrade, currently Ba1
Senior Secured Bank Credit Facility Nov 9, 2016, Placed on
Review for Downgrade, currently Ba1
Outlook Actions:
Issuer: Open Text Corp.
Outlook, Changed To Rating Under Review From Stable
Open Text's liquidity is good based on $491 million of cash as of
September 30, 2013 and continued expectation of strong levels of
free cash flow (free cash flow for the twelve months ended
September 2013 was $274 million). The company's SGL-1 liquidity
rating could come under pressure however depending on the amount
of cash used for the transaction.
Open Text Corp., headquartered in Waterloo, Ontario, Canada, is
one of the largest providers of enterprise content management and
business process management software. For twelve months ended
September 30, 2013, revenues were approximately $1.4 billion.
ORCHARD FLOWER: Case Summary & 8 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Orchard Flower Partners, LP
5917 Sherry Lane
Dallas, TX 76225
Case No.: 13-42699
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Eastern District of Texas (Sherman)
Judge: Hon. Brenda T. Rhoades
Debtor's Counsel: Frank J. Wright, Esq.
WRIGHT GINSBERG BRUSILOW P.C.
600 Signature Place
14755 Preston Road
Dallas, TX 75254
Tel: 972-788-1600
Email: bankruptcy@wgblawfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
A list of the Debtor's eight largest unsecured creditors is
available for free at http://bankrupt.com/misc/txeb13-42699.pdf
OSX BRASIL: Said to Plan Bankruptcy Filing by Early Next Week
-------------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that OSX Brasil SA, the
shipbuilding company controlled by former billionaire Eike
Batista, is planning to file for bankruptcy protection by early
next week, according to two people familiar with the matter.
The Bloomberg report related that the decision to file has already
been made, the people said, asking not to be identified because it
hasn't been announced yet. While a petition for judicial recovery,
as it is known in Brazil, may be lodged as soon as this week, it
is more likely to take place next week, one of the people said.
A filing would put $500 million of dollar bonds into default after
Batista's oil company and OSX's biggest client, OGX Petroleo & Gas
Participacoes SA, sought protection on Oct. 30 in Latin America's
largest corporate debt debacle. OSX's total debt was 5.3 billion
reais ($2.3 billion), according to its second-quarter earnings
release.
In an Oct. 31 statement, the shipbuilder said it was ready to seek
bankruptcy protection if management decided that was the most
adequate way to protect its interests. OSX continues to study the
measure, a press department official said by phone on Nov. 5,
asking not to be named in line with company policy.
OSX and OGX were the only two of Batista's six publicly listed
companies that had issued bonds in international markets. Batista
either relinquished control of, or agreed to sell key assets and
stakes in, the four other start-ups. OSX was building three
vessels for OGX before the explorer's tests uncovered an absence
of oil in a series of non-commercial wells.
The shipbuilder is in talks to extend the maturity of a 400
million-real loan from state-run Caixa Economica Federal, Rio de
Janeiro-based OSX said by e-mail on Nov. 5. Since Aug. 18
Brazil's state development bank BNDES has been pushing out
maturities on a loan for 518 million reais.
OSX bondholders hired AlixPartners LLP to advise on the possible
restructuring of $500 million in bonds, according to two people
with knowledge of the matter.
OSX Brasil SA is a shipbuilder controlled by billionaire Eike
Batista.
OVERSEAS SHIPHOLDING: Taps Gellert Scali as Litigation Counsel
--------------------------------------------------------------
Overseas Shipholding Group, Inc. and its debtor-affiliates ask for
permission from the U.S. Bankruptcy Court for the District of
Delaware to employ Gellert, Scali, Busenkell & Brown, LLC as
special litigation counsel, nunc pro tunc to Oct. 21, 2013.
The Debtors require Gellert Scali to:
(a) act as lead counsel or Delaware counsel in the claims
matters;
(b) act as lead counsel or Delaware counsel in the litigation
matters;
(c) represent the Debtors before the Court or other state or
federal courts in Delaware in the litigation matters; and
(d) negotiate settlements on behalf of the Debtors in the
claims matters and the litigation matters.
Gellert Scali will be paid at these hourly rates:
Michael Busenkell $350
Brya Kielson $270
Paraprofessionals $105-$165
Gellert Scali will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Michael Busenkell, Esq., member of Gellert Scali, assured the
Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtors and their estates.
Gellert Scali can be reached at:
Michael Busenkell, Esq.
GELLERT, SCALI, BUSENKELL & BROWN, LLC
913 N. Market Street, 10th Floor
Wilmington, DE 19801
Tel: (302) 425-5800
Fax: (302) 425-5814
E-mail: mbusenkell@gsbblaw.com
About Overseas Shipholding Group, Inc.
Overseas Shipholding Group, Inc., headquartered in New York, is
one of the largest publicly traded tanker companies in the world,
engaged primarily in the ocean transportation of crude oil and
petroleum products. OSG owns or operates 111 vessels that
transport oil and petroleum products throughout the world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67
billion in liabilities. Greylock Partners LLC Chief Executive
John Ray serves as chief reorganization officer. James L.
Bromley, Esq., and Luke A. Barefoot, Esq., at Cleary Gottlieb
Steen & Hamilton LLP serve as OSG's Chapter 11 counsel. Derek C.
Abbott, Esq., Daniel B. Butz, Esq., and William M. Alleman, Jr.,
at Morris, Nichols, Arsht & Tunnell LLP, serve as local counsel.
Chilmark Partners LLC serves as financial adviser. Kurtzman
Carson Consultants LLC is the claims and notice agent.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve
as co-counsel to the official committee of unsecured creditors.
FTI Consulting, Inc., is the financial advisor and Houlihan Lokey
Capital, Inc., is the investment banker.
PEREGRINE FINANCIAL: US Bank Can't Escape Suit Over $215MM Fraud
----------------------------------------------------------------
Law360 reported that an Iowa federal judge refused to dismiss the
U.S. Commodity Futures Trading Commission's lawsuit accusing U.S.
Bank NA of helping bankrupt Peregrine Financial Group Inc.'s
former CEO misappropriate $215 million in customer funds, saying
on Nov. 5 the commission has adequately pled its claims.
According to the report, U.S. District Judge Linda R. Reade said
the CFTC's complaint contained sufficient factual allegations that
U.S. Bank knew it was holding Peregrine customer funds subject to
the Commodity Exchange Act, was illegally using those funds and
benefited from the purported violations.
The case is US Commodity Futures Trading Commission v. US Bank,
NA, Case No. 6:13-cv-02041 (N.D. Iowa) before Judge Linda R Reade.
About Peregrine Financial
Peregrine Financial Group Inc. filed to liquidate under Chapter 7
of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 12-27488)
on July 10, 2012, disclosing between $500 million and $1 billion
of assets, and between $100 million and $500 million of
liabilities.
Earlier that day, at the behest of the U.S. Commodity Futures
Trading Commission, a U.S. district judge appointed a receiver and
froze the firm's assets. The firm put itself into bankruptcy
liquidation in Chicago later the same day. The CFTC had sued
Peregrine, saying that more than $200 million of supposedly
segregated customer funds had been "misappropriated." The CFTC
case is U.S. Commodity Futures Trading Commission v. Peregrine
Financial Group Inc., 12-cv-5383, U.S. District Court, Northern
District of Illinois (Chicago).
Peregrine's CEO Russell R. Wasendorf Sr. unsuccessfully attempted
suicide outside a firm office in Cedar Falls, Iowa, on July 9.
The bankruptcy petition was signed in his place by Russell R.
Wasendorf Jr., the firm's chief operating officer. The resolution
stated that Wasendorf Jr. was given a power of attorney on July 3
to exercise if Wasendorf Sr. became incapacitated.
Peregrine Financial is the regulated unit of the brokerage
PFGBest.
PHILADELPHIA ACHIEVEMENT: S&P Alters Outlook to Negative
--------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook to negative
from stable and affirmed its 'BB+' long-term rating on
Philadelphia Authority For Industrial Development, Pa.'s series
2011 revenue bonds issued for West Philadelphia Achievement
Charter Elementary School (WPACES).
"The negative outlook reflects the fact that the school has not
signed its charter contract with the School District of
Philadelphia," said Standard & Poor's credit analyst Sharon
Gigante. WPACES was offered a renewed charter contract with the
School District of Philadelphia (SDP) in 2011, but to date it has
not signed the charter because of the disagreement surrounding the
cap on its enrollment. The SDP included a cap of 400 students, and
WPACES objected to the cap based on the belief that charter
enrollment caps are illegal and therefore should not be included
in the charter.
The rating also reflects S&P's view of the school's adequate
academic performance; adequate, but stable, financial performance;
inherent uncertainty associated with all charter renewals; and the
exceptional budget constraints of the SDP.
Factors offsetting these weaknesses include: a good demand
profile, with approximately 219 students on a wait list (as of
January 2013) and operations that cover maximum annual debt
service coverage of 1.2x.
The negative outlook reflects S&P's assessment of the risk that
the nonrenewal status of the charter could mean for future
funding. S&P is uncertain what will transpire for WPACES because
the broader situation with the SDP surrounding charter caps
remains fluid. Nevertheless, S&P believes that the added risk
makes a lower rating possible within the outlook period if the
charter is not renewed or the school does not receive per pupil
funding for the students over the cap. S&P would likely lower the
rating if the school experienced significant declines in per-pupil
funding, coverage dropped to less than 1.1x, or the school was
unable to improve academic performance. S&P would likely revise
the outlook to stable if WPACES' charter is signed and if other
credit attributes remain in line with recent history.
PREMIERE ENTERPRISES: May Hire Stubbs & Perdue as Counsel
---------------------------------------------------------
Bankruptcy Judge Randy D. Doub authorized Premiere Enterprises of
Whiteville, LLC, to employ Trawick H. Stubbs, Jr., and Stubbs &
Perdue, P.A., as Chapter 11 attorney for the Debtor, over the
objection filed by the United States Bankruptcy Administrator.
The Bankruptcy Administrator's Objection contends that the Firm
was not a disinterested person as defined in 11 U.S.C. Sec.
101(14) and as required by Sec. 327(a) and as a result the Firm
cannot be employed.
As required by F.R.B.P. 2014(a), the Application to Employ
contained an affidavit executed by Mr. Stubbs, disclosing the
compensation arrangement between the Debtor and the Firm. The
Affidavit states that Lake Waccamaw Convalescent Center, LLC, an
entity owned by the Debtor's sole member, paid a retainer in the
amount of $1,213.00 on behalf of the Debtor. From these trust
funds, $1,213.00 was paid to the Firm representing unpaid pre-
petition fees and expenses incurred by the Debtor. The Affidavit
states that at the time of filing, $5,157.40 was owed to the Firm
representing fees and expenses incurred in anticipation of the
Chapter 11 filing.
Judge Doub said the Application to Employ is granted, subject to
these conditions: (1) the Bankruptcy Administrator shall review
the First Application for Compensation to determine if all of the
fees requested and not paid pre-petition, are relatively modest,
traceable temporally to a short period of time before filing, and
confined to activities surrounding the preparation of the petition
and accompanying papers -- the bare-bones, routine and necessary
services for filing; and (2) if any of the pre-petition fees
requested are not specifically relative to the preparation and the
filing of the petition, then the Bankruptcy Administrator shall
object or in the alternative, the Firm shall waive those
objectionable fees requested or request a hearing.
Judge Doub added that "counsel in this District should rarely
invoke the services in preparation and in anticipation of filing
the petition doctrine to be qualified as disinterested. The
preferred practice in this District is for all pre-petition
services prior to filing be paid prior to the time of filing the
Chapter 11 petition."
A copy of Judge Doub's Nov. 4, 2013 Order is available at
http://is.gd/yTtOyVfrom Leagle.com.
Based in Whiteville, North Carolina, Premiere Enterprises of
Whiteville, LLC -- fdba 701 Associates, Inc., Dawsey Investment
Company, Premier Construction, Inc., and Premiere Property, LLC --
filed a Chapter 11 bankruptcy petition (Bankr. E.D.N.C. Case No.
13-04639) on July 26, 2013, estimating $1 million to $10 million
in both assets and debts. Judge Randy D. Doub oversees the case.
Trawick H. Stubbs, Jr., Esq., at Stubbs & Perdue, P.A., serves as
the Debtor's counsel. The petition was signed by E. Autry Dawsey,
Sr., manager.
Affiliates that filed separate Chapter 11 petition are E. Autry &
Faye Dawsey (Case No. 13-_____) on July 26, 2013; and Premiere
Hospitality Group, Inc. (Case No. 13-02145) on April 3, 2013.
QUIGLEY COMPANY: Reorganization Plan Finally Effective
------------------------------------------------------
BankruptcyData reported that privately-held Quigley Company's Plan
of Reorganization became effective, and the Company emerged from
Chapter 11 protection.
The Bankruptcy Court confirmed the Plan on June 28, 2013; and the
District Court reaffirmed the Bankruptcy Court confirmation order
on Aug. 2, 2013. Because this proceeding involved asbestos-
related litigation, both Bankruptcy and District Court approval
was required.
About Quigley Co.
Quigley Co. was acquired by Pfizer in 1968 and sold small amounts
of products containing asbestos until the early 1970s. In
September 2004, Pfizer and Quigley took steps that were intended
to resolve all pending and future claims against the Company and
Quigley in which the claimants allege personal injury from
exposure to Quigley products containing asbestos, silica or mixed
dust. Quigley filed for bankruptcy in 2004 and has a Chapter 11
plan and a settlement with Chrysler.
Quigley filed for Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 04-15739) on Sept. 3, 2004, to implement a
proposed global resolution of all pending and future asbestos-
related personal injury liabilities.
Lawrence V. Gelber, Esq., and Michael L. Cook, Esq., at Schulte
Roth & Zabel LLP, represent the Debtor in its restructuring
efforts. Elihu Inselbuch Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Unsecured Creditors. When
the Debtor filed for protection from its creditors, it disclosed
$155,187,000 in total assets and $141,933,000 in total debts.
In April 2011, the bankruptcy judge approved a plan-support
agreement with Pfizer and an ad hoc committee representing 30,000
asbestos claimants.
A May 20, 2011 opinion by District Judge Richard Holwell concluded
that Pfizer was directly liable for some asbestos claims arising
from products sold by its now non-operating subsidiary Quigley.
The district court ruling was upheld in the appeals court.
In August 2013, the U.S. District Court reaffirmed the June 28,
2013 U.S. Bankruptcy Court order confirming Quigley's Chapter 11
Plan of Reorganization.
RAMS ASSOCIATES: Has Financing From ACT to Pay Off Power Supplier
-----------------------------------------------------------------
Rams Associates, L.P., sought and obtained approval from the U.S.
Bankruptcy Court for District of New Jersey to obtain debtor-in-
possession financing from Athletic Community Team, LLC.
ACT is willing to lend up to $54,346 to the Debtor for the
purposes of paying the requested deposit to Jersey Central Power &
Light. JCPL is the supplier of power to the Debtor's Jersey Shore
Arena, with the Debtor requiring in excess of $20,000 per month in
electric usage on average throughout the year.
The Debtor says it does not have sufficient cash flow to pay any
meaningful deposit to JCPL and thus faces a possible shut off of
its crucial electric power.
ACT requires that all monies lent to the Debtor be secured by a
junior lien against the Debtor's assets. The loan will accrue
interest at a rate of 3.25% per annum.
The order provides that in accordance with Section 364(c)(3) of
the Bankruptcy Code, all obligations accrued by the Debtor to ACT
will be secured by a junior lien against all of the Debtor's real
property and other assets without the necessity of ACT filing a
mortgage or financing statement.
About Rams Associates
Rams Associates LP was formed in 1990 for the purpose of acquiring
and operating an ice rink then operated under the name American
Hockey & Ice Skating Center located in Farmingdale, New Jersey for
a purchase price of $1,800,000 for the land and building. Rams
expended another $3,200,000 to build-out the arena and purchase
the necessary equipment to operate the Arena. Rams continues to
own and operate the ice rink, under the name Jersey Shore Arena.
On June 25, 2013, an involuntary petition under chapter 7 of the
United States Bankruptcy Code, 11 U.S.C. Sec. 101, et seq. was
filed against Rams, which proceeding was assigned Case No.
13-23969 (CMG).
On July 16, 2013, Rams Associates filed a superseding Chapter 11
petition (Bankr. D.N.J. Case No. 13-25541) in Trenton, New Jersey.
On July 30, 2013, a consent order substantively consolidating
cases was entered by the Bankruptcy Court, which allowed for Rams
to proceed with the superseding chapter 11 case.
Judge Christine M. Gravelle presides over the case. Norris
McLaughlin & Marcus, P.A., serves as the Debtor's counsel.
The Debtor estimated assets and debts of at least $10 million.
RESERVOIR EXPLORATION: Seismic-Data Provider Files Bankruptcy
-------------------------------------------------------------
Michael Bathon, substituting Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that Reservoir Exploration
Technology Inc., a provider of seismic data to the oil and gas
industry, joined its Norwegian parent in seeking bankruptcy
protection from creditors.
According to the report, the Dallas-based company listed $13.7
million in assets and $18.8 million in debt in Chapter 11
documents filed Nov. 5 in U.S. Bankruptcy Court in Fort Worth,
Texas. Almost all of the debt is owed to its Lysaker, Norway-
based parent, Reservoir Exploration Technology ASA, which has an
unsecured claim of about $18.5 million, court papers show.
The company, its parent and affiliates specialize in sea floor
seismic-data collection, according to court documents. Reservoir
Exploration Technology ASA and its units operated vessels in the
Gulf of Mexico, the North Sea, West Africa and the Caspian Sea.
The parent filed for bankruptcy in Norway in June after economic
conditions in 2008 and 2009 forced it to undergo a restructuring
that converted debt to equity and shrank its fleet. Foreign
affiliates have entered court protection in their respective
countries as the Norwegian court-appointed liquidator winds down
the parent.
Reservoir estimates that it has less than $285,000 in allowable
unpaid claims, excluding intercompany debt owed to its parent.
The company said it can pay all of those claims under an agreement
with the parent to fund its liquidation.
The company's only assets are cash, a share of a receivable owed
to an affiliate by Shell E&P Ireland Ltd., and intercompany
receivables, court papers show. Reservoir filed an outline of a
liquidation plan under which the parent would pay $630,000 for the
receivables and subordinate its $18.5 million claims to all other
general unsecured claims.
The case is In re Reservoir Exploration Technology Inc., 13-bk-
45148, U.S. Bankruptcy Court, Northern District of Texas (Fort
Worth).
RESERVOIR EXPLORATION: Case Summary & 16 Unsecured Creditors
------------------------------------------------------------
Debtor: Reservoir Exploration Technology, Inc.,
Attorney for Chief Restructuring Officer
c/o Jay H. Ong
Munsch Hardt Kopf & Harr, P.C.
500 N. Akard Street, Suite 3800
Case No.: 13-45148
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Northern District of Texas (Ft. Worth)
Judge: Hon. Michael Lynn
Debtor's Counsel: Jay Ong, Esq.
MUNSCH HARDT KOPF & HARR, P.C.
401 Congress Avenue, Suite 3050
Austin, TX 78701
Tel: (512) 391-6124
Fax: (512) 226-7105
Email: jong@munsch.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Jason Rae, chief restructuring officer.
List of Debtor's 16 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Reservoir Exploration General Trade $18,544,591
Technology, ASA
c/o Advokatfirmaet Selmer DA
P.O. Box 1324 Vika
OSLO N-0112 NO
HM Revenue & Customs Payroll Tax $132,734
Jonathan David Byers Employee Benefits $23,876
Jon Eric Strohbehn Employee Benefits $18,096
Kelly Lynn Redden Employee Benefits $16,654
Christopher Vandeberg Employee Benefits $13,701
Tyrell Kipp Employee Benefits $12,744
Timothy Wilson Employee Benefits $11,689
Office of Revenue Paye Taxes $11,689
Commissioners
Taylor Patterson Employee Benefits $11,327
Jennifer Bowman Employee Benefits $7,800
James Walden Employee Benefits $6,565
Ramon E. Hernandez Employee Benefits $5,437
Paul Dusevitch Employee Benefits $4,304
Christopher Kellogg Employee Benefits $1,974
Zeno Imaging General Trade $512
RESIDENTIAL CAPITAL: Confident Ch. 11 Exit Will Be Smooth
---------------------------------------------------------
Law360 reported that attorneys for Residential Capital LLC and its
unsecured creditors told a New York bankruptcy court on Nov. 4
that they expect the fallen mortgage servicer's plan confirmation
hearing to be largely uncontested, with the exception of a long-
running dispute over interest payments to junior secured
noteholders.
According to the report, at a hearing before U.S. Bankruptcy Judge
Martin Glenn, Gary S. Lee of Morrison & Foerster LLP said ResCap
has resolved many of the objections lodged against the plan, which
rests on a global settlement involving former parent Ally
Financial Inc.
About Residential Capital
Residential Capital LLC, the unprofitable mortgage subsidiary of
Ally Financial Inc., filed for bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 12-12020) on May 14, 2012.
Neither Ally Financial nor Ally Bank is included in the bankruptcy
filings.
ResCap, one of the country's largest mortgage originators and
servicers, was sent to Chapter 11 with 50 subsidiaries amid
"continuing industry challenges, rising litigation costs and
claims, and regulatory uncertainty," according to a company
statement.
ResCap disclosed $15.68 billion in assets and $15.28 billion in
liabilities at March 31, 2012.
Centerview Partners LLC and FTI Consulting are acting as financial
advisers to ResCap. Morrison & Foerster LLP is acting as legal
adviser to ResCap. Curtis, Mallet-Prevost, Colt & Mosle LLP is
the conflicts counsel. Rubenstein Associates, Inc., is the public
relations consultants to the Company in the Chapter 11 case.
Morrison Cohen LLP is advising ResCap's independent directors.
Kurtzman Carson Consultants LLP is the claims and notice agent.
Ray C. Schrock, Esq., at Kirkland & Ellis LLP, in New York, serves
as counsel to Ally Financial.
ResCap sold most of the businesses for a combined $4.5 billion.
The Bankruptcy Court in November 2012 approved ResCap's sale of
its mortgage servicing and origination platform assets to Ocwen
Loan Servicing, LLC and Walter Investment Management Corporation
for $3 billion; and its portfolio of roughly 50,000 whole loans to
Berkshire Hathaway for $1.5 billion.
ResCap's Chapter 11 reorganization plan is set for approval at a
Nov. 19 confirmation hearing. Most ResCap creditors support the
plan, which is financed in part by a $2.1 billion settlement
contribution from Ally.
Bankruptcy Creditors' Service, Inc., publishes RESIDENTIAL CAPITAL
BANKRUPTCY NEWS. The newsletter tracks the Chapter 11 proceeding
undertaken by affiliates of Residential Capital LLC and its
affiliates (http://bankrupt.com/newsstand/or 215/945-7000).
RG STEEL: GEM Gets Extension of Right Under HRE Access Agreement
----------------------------------------------------------------
U.S. Bankruptcy Judge Kevin Carey approved an agreement granting
Grand East Metals an extension of its right under a temporary
access agreement with HRE Sparrows Point LLC.
Grand East in September asked for an extension of its right to
remove a mill steel stored in RG Steel's Sparrows Point plant in
Baltimore, Maryland. The company has the right to remove the
property reportedly worth $1.5 million pursuant to its temporary
access agreement with HRE, which bought the steel maker's Sparrows
Point assets last year.
Under the court-approved agreement, Grand East's right of access
will expire on the earlier of (i) completion of any agreed upon
removal of its property from the Sparrows Point plant, or (ii)
November 14, 2013.
In case the mill steel is not removed from the plant on or before
November 14, it will be deemed sold to HRE upon payment by HRE of
the purchase price on or before November 22 without further
approval by the court. A copy of the agreement is available for
free at http://is.gd/2ozPff
Grand East Metal is represented by:
Scott J. Leonhardt, Esq.
The Rosner Law Group LLC
824 Market Street, Suite 810
Wilmington, DE 19801
Telephone: (302) 777-1111
Email: leonhardt@teamrosner.com
HRE Sparrows Point LLC is represented by:
Eric S. Prezant, Esq.
Bryan Cave LLP
161 North Clark Street, Suite 4300
Chicago, IL 60601
Telephone: (312) 602-5000
Email: eric.prezant@bryancave.com
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owned Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012. Bankruptcy was precipitated by liquidity
shortfall and a dispute with Mountain State Carbon, LLC, and a
Severstal affiliate, that restricted the shipment of coke used in
the steel production process.
The Debtors estimated assets and debts in excess of $1 billion.
As of the bankruptcy filing, the Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial
advisor and The Seaport Group serves as lead investment banker.
Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman
Carson Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's financial advisor.
The Debtor has sold off the principal plants. The sale of the
Wheeling Corrugating division to Nucor Corp. brought in $7
million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
RG STEEL: Federal Judge Dismisses Appeal of Trust Beneficiaries
---------------------------------------------------------------
A federal judge dismissed an appeal filed by a group of trust
beneficiaries to review a bankruptcy judge's decision that
authorized RG Steel Chief Financial Officer Richard Caruso to act
on behalf of RG Steel Wheeling LLC under a trust agreement.
U.S. Bankruptcy Judge Kevin Carey on July 2 authorized Mr. Caruso
to act on behalf of the steel maker in order to direct PNC Bank
N.A. to return the funds held in trust by the bank.
In a two-page decision, Judge Richard Andrews of the U.S. District
Court for the District of Delaware dismissed the appeal filed by
the group led by Richard Carter for "lack of jurisdiction."
"The order appealed from is a discretionary and interlocutory
order which, under the circumstances of the record in this case,
is not appealable," the federal judge said.
Judge Andrews also pointed out that PNC Bank has already
transferred the funds to Wilmington Trust and that the bankruptcy
judge "reserved all substantive decisions for another day."
"No reason occurs to me (and none has been suggested) why, if the
appellants are successful when substantive decisions have been
made, the money cannot be transferred back to PNC then," the
federal judge said.
PNC is a party to a 1990 agreement with Wheeling-Pittsburgh Steel
Corp. that created the trust to hold and distribute funds held in
connection with WPSC's employee benefit plans. RG Steel Wheeling,
as successor to WPSC, is also a party to the 1990 agreement.
About RG Steel
RG Steel LLC -- http://www.rg-steel.com/-- is the United States'
fourth-largest flat-rolled steel producer with annual steelmaking
capacity of 7.5 million tons. It was formed in March 2011
following the purchase of three steel facilities located in
Sparrows Point, Maryland; Wheeling, West Virginia and Warren,
Ohio, from entities related to Severstal US Holdings LLC. RG
Steel also owns finishing facilities in Yorkville and Martins
Ferry, Ohio. It also owned Wheeling Corrugating Company and has a
50% ownership in Mountain State Carbon and Ohio Coatings Company.
RG Steel along with affiliates, including WP Steel Venture LLC,
sought bankruptcy protection (Bankr. D. Del. Lead Case No. 12-
11661) on May 31, 2012. Bankruptcy was precipitated by liquidity
shortfall and a dispute with Mountain State Carbon, LLC, and a
Severstal affiliate, that restricted the shipment of coke used in
the steel production process.
The Debtors estimated assets and debts in excess of $1 billion.
As of the bankruptcy filing, the Debtors owe (i) $440 million,
including $16.9 million in outstanding letters of credit, to
senior lenders led by Wells Fargo Capital Finance, LLC, as
administrative agent, (ii) $218.7 million to junior lenders, led
by Cerberus Business Finance, LLC, as agent, (iii) $130.5 million
on account of a subordinated promissory note issued by majority
owner The Renco Group, Inc., and (iv) $100 million on a secured
promissory note issued by Severstal.
Judge Kevin J. Carey presides over the case.
The Debtors are represented in the case by Robert J. Dehney, Esq.,
and Erin R. Fay, Esq., at Morris, Nichols, Arsht & Tunnell LLP,
and Matthew A. Feldman, Esq., Shaunna D. Jones, Esq., Weston T.
Eguchi, Esq., at Willkie Farr & Gallagher LLP, represent the
Debtors. Conway MacKenzie, Inc., serves as the Debtors' financial
advisor and The Seaport Group serves as lead investment banker.
Donald MacKenzie of Conway MacKenzie, Inc., as CRO. Kurtzman
Carson Consultants LLC is the claims and notice agent.
Wells Fargo Capital Finance LLC, as Administrative Agent, is
represented by Jonathan N. Helfat, Esq., and Daniel F. Fiorillo,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C.; and Laura
Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachuiski Stang
Ziehi & Jones LLP.
Renco Group is represented by lawyers at Cadwalader, Wickersham &
Taft LLP.
Kramer Levin Naftalis & Frankel LLP represents the Official
Committee of Unsecured Creditors. Huron Consulting Services LLC
serves as the Committee's financial advisor.
The Debtor has sold off the principal plants. The sale of the
Wheeling Corrugating division to Nucor Corp. brought in $7
million. That plant in Sparrows Point, Maryland, fetched the
highest price, $72.5 million. CJ Betters Enterprises Inc. paid
$16 million for the Ohio plant.
REEVES DEVELOPMENT: Seeks Court Approval to Use Cash Collateral
---------------------------------------------------------------
Reeves Development Co. LLC asked the U.S. Bankruptcy Court for the
Western District of Louisiana for approval to use a portion of the
funds considered to be the cash collateral of IberiaBank.
The company will use the funds to start the operation of a
material pit for the supply of embankment material for the Johnson
Brothers Corp.'s I-120 Cove Lane Interstate Project in Lake
Charles, Louisiana.
Reeves said it has no available source of funds for the project,
which is estimated to be no more than $200,000.
After the start up period, the project will operate from self-
generated funds, the company said, adding that repayment of the
cash collateral will be complete in about eight months from
inception.
Reeves said that "no adequate protection is needed since
IberiaBank maintains a large equity cushion," pointing out that
the value of the collateral securing its debt to the bank exceeds
$17.5 million.
The company owes approximately $7.5 million to IberiaBank, which
asserts an $11.12 million claim against the company.
Reeves in February received the green light to use the cash
collateral of IberiaBank. As adequate protection, the bank was
granted continuing first-priority security interests in all pre-
bankruptcy collateral and replacement security interests in all
post-petition collateral.
The court will hold a hearing on November 14 to consider approval
of the request.
About Reeves Development
Reeves Development Company, LLC, a commercial and residential real
estate developer, filed a Chapter 11 petition (Bankr. W.D. La.
Case No. 12-21008) in Lake Charles, Louisiana, on Oct. 30, 2012.
The closely held developer was founded in 1998 by Charles Reeves
Jr., its sole owner. Reeves Development has about 80 employees
and generates about $40 million in annual revenue, according to
its Web site.
Bankruptcy Judge Robert Summerhays oversees the case. Arthur A.
Vingiello, Esq. -- avingiello@steffeslaw.com -- at Steffes,
Vingiello & McKenzie, LLC, in Baton Rogue, Louisiana, represents
the Debtor as counsel.
Reeves Development scheduled assets of $15,454,626 and liabilities
of $20,156,597 as of the Petition Date.
Affiliate Reeves Commercial Properties, LLC (Bankr. W.D. La. Case
No. 12-21009) also sought court protection.
RICHARD ALLEN: S&P Lowers Rating on 2006 Revenue Bonds to 'BB+'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
Philadelphia Authority for Industrial Development, Pa.'s series
2006 revenue bonds to 'BB+' from 'BBB-' issued on behalf of
Richard Allen Preparatory Charter School (RAPCS). The outlook is
negative.
"The downgrade reflects the possibility RAPCS will have to lower
its enrollment following the School District of Philadelphia's
announcement that it is not granting enrollment increases to
charter schools and the possibility that lower enrollment levels,
if forced, will financially distress RAPCS," said Standard &
Poor's credit analyst Sharon Gigante. RAPCS is currently
operating with slim operating margins and a weak cash position,
and S&P believes the uncertainty surrounding the School District
of Philadelphia's (SDP) actions with respect to per pupil funding
and future enrollment caps weakens RAPCS' overall credit profile.
The negative outlook reflects the fact that the school is
operating with an unsigned charter. Standard & Poor's is
concerned with the school's inability to meet future debt service
if it must lower enrollment to 425 following reauthorization under
a new charter or be forced to reimburse the SDP for funds
collected above the 425 cap. The school is appealing the SDP's
decision to not renew the charter to the State Charter Appeal
Board, but the timing and the ultimate outcome of the appeal are
unknown at this time.
In addition, the lower rating reflects S&P's view of the risk for
all charter schools that may not have their charters renewed, or
could have them revoked -- especially in Philadelphia; and the
school's adequate, although improving, financial performance.
These factors are offset, in S&P's opinion, by the school's
academic performance; historical coverage of future maximum annual
debt service; a good waiting list of over 500 prospective students
for the last school year; and the ability to request directly from
PDE funding reimbursement for enrollment above its charter cap,
which the school has routinely done.
There is a lot of uncertainty surrounding the SDP's future
actions, if any, against schools that are operating over existing
enrollment caps, and the impact that future SDP actions could have
on the school's financial position if the school had to reimburse
the SDP for these excess funds or lower enrollment.
S&P believes that the dispute over enrollment caps will be
resolved in the one- to two-year outlook timeframe. If the
outcome is favorable to RAPCS, and an enrollment increase is
granted, S&P would likely consider a higher rating if the school
continued to show strong demand and good academic outcomes. S&P
would consider a negative rating action if the school was required
to lower enrollment to 425 students, the amount requested by the
district, and the school was unable to reduce expenses
accordingly, thereby causing financial stress to operations, cash,
and debt service coverage.
RURAL/METRO CORP: Files Motion to Settle Qui Tam Civil Suit
-----------------------------------------------------------
Rural/Metro Corporation on Nov. 5 disclosed that it filed a motion
with the bankruptcy court seeking approval of a voluntary civil
settlement agreement it reached in principle with the U.S.
Attorney's Office of the Southern District of California that
would result in the dismissal of a qui tam civil suit filed in
2009 against the Pacific Ambulance, Inc. and Bowers Companies,
Inc., which Rural/Metro purchased in September 2011. All of the
alleged misconduct being investigated by the U.S. Attorney's
Office in connection with the qui tam suit occurred prior to
Rural/Metro's acquisition of Pacific and Bowers, and the
settlement ensures Rural/Metro will be released from all legacy
liabilities it acquired related to the underlying investigation.
The qui tam suit is based upon allegations regarding the
submission of false claims to the government by engaging in
alleged improper swapping arrangements with skilled nursing
facilities. Rural/Metro cooperated fully with the review of these
matters and is pleased to have reached a resolution, pending the
approval of the bankruptcy court.
The settlement with the U.S. Attorney's Office does not include
any additional integrity provisions to the Corporate Integrity
Agreement ("CIA"), under which Rural/Metro has been operating for
the past year.
Under the settlement agreement, Rural/Metro will pay the
government $8 million plus interest, funded entirely by funds that
have been held in escrow since the acquisition of Pacific and
Bowers in September 2011. The escrow account has sufficient funds
to satisfy the terms of the agreement; accordingly, the settlement
will have no impact on the Company's balance sheet and financial
flexibility.
Rural/Metro resolved the legacy liabilities it acquired in
connection with its purchase of Pacific and Bowers, and is
committed to ensuring that it remains in strict compliance with
all applicable laws, regulations and standards in each of the
markets and jurisdictions in which it operates.
About Rural/Metro Corp
Headquartered in Scottsdale, Arizona, Rural/Metro Corporation --
http://www.ruralmetro.com-- is a national provider of 911-
emergency and non-emergency interfacility ambulance services and
private fire protection services, operating in 21 states and
nearly 700 communities. Rural/Metro was acquired in 2011 in a
leveraged buyout by Warburg Pincus LLC as part of a transaction
valued at $676.5 million.
Rural/Metro Corp. and 59 affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 13-11952) on Aug. 4, 2013, before
the U.S. Bankruptcy Court for the District of Delaware. Debt
includes $318.5 million on a secured term loan and $109 million on
a revolving credit with Credit Suisse AG serving as agent. There
is $312.2 million owing on two issues of 10.125 percent senior
unsecured notes.
The Debtors' lead bankruptcy counsel are Matthew A. Feldman, Esq.,
Rachel C. Strickland, Esq., and Daniel Forman, Esq., at Willkie
Farr & Gallagher LLP, in New York. Maris J. Kandestin, Esq., and
Edmon L. Morton, Esq., at Young, Conaway, Stargatt & Taylor, LLP,
in Wilmington, Delaware, serve as the Debtors' local Delaware
counsel.
Alvarez & Marsal Healthcare Industry Group, LLC, and FTI
Consulting, Inc., are the Debtors' financial advisors, while
Lazard Freres & Co. L.L.C. is their investment banker. Donlin,
Recano & Company, Inc., is the Debtors' claims and noticing agent.
The U.S. Trustee has appointed a three-member official committee
of unsecured creditors in the Chapter 11 case.
The Debtors have arranged $75 million of DIP financing from a
group of prepetition lenders led by Credit Suisse AG. An interim
order has allowed the Debtors to access $40 million of the DIP
facility.
The Debtors have filed a reorganization plan largely worked out
before the Chapter 11 filing in early August. Existing
shareholders receive nothing in the plan.
SAKS INC: Moody's Withdraws 'Ba2' CFR Over Merger Completion
------------------------------------------------------------
Moody's Investors Service withdrew all the ratings of Saks
Incorporated following the closing of the its merger with Hudson's
Bay Company on November 4, 2013.
The following ratings are withdrawn:
Corporate Family Rating at Ba2
Probability of Default Rating at Ba2-PD
$2 million guaranteed global notes due 2013 at Ba3 (LGD 5, 84%)
SHOTWELL LANDFILL: LSCG & Cook Seek Appointment of Ch.11 Trustee
----------------------------------------------------------------
LSCG Fund 18 LLC and David A. Cook filed a motion with the U.S.
Bankruptcy Court seeking the appointment of a chapter 11 trustee
in Shotwell Landfill, Inc.'s case.
LSCG Fund 18 LLC and David A. Cook said the Debtor is owed
hundreds of thousands of dollars from David W. King's other
companies that may never be recovered. They said Mr. King's
pervasive dishonesty, mismanagement, incompetence, and fraud have
rendered him incapable of fulfilling the Debtor's fiduciary
duties.
LSCG Fund 18 LLC and David A. Cook said a chapter 11 trustee
should be appointed because (1) there is a cause due to the
Debtor's fraud, mismanagement, and incompetence, and (2) such an
appointment is in the best interest if the estate and all parties.
Hearing on the motion was set for Nov. 4, 2013, at 11:00 a.m.
Attorney for LSCG Fund can be reached at:
Thomas W. Waldrep, Jr., Esq.
Jennifer B. Lyday, Esq.
WOMBLE CARLYLE SANDRIDGE & RICE LLP
One West Fourth Street
Winston-Salem, NC 27101
Tel: 336-747-6631
Fax: 336-726-8531
E-mail: bankruptcy@wcsr.com
Attorney for David A. Cook
Kevin L. Sink, Esq.
NICHOLLS & CRAMPTON PA
3700 Glenwood Avenue Suite 500
Raleigh, NC 27612
Tel: 919-781-1311
Fax: 919-782-0465
Email: lsink@nichillscrampton.com
About Shotwell Landfill, Inc.
Raleigh, North Carolina-based Shotwell Landfill, Inc., filed a
Chapter 11 petition (Bankr. E.D.N.C. Case No. 13-02590) in
Wilson on April 19, 2013. The Debtor disclosed $23,027,736 in
assets and $10,039,308 in liabilities as of the Chapter 11 filing.
Blake P. Barnard, Esq., William P. Janvier, Esq., and Samantha Y.
Moore, Esq., at the Janvier Law Firm, PLLC, in Raleigh, N.C.,
represent the Debtor as counsel. William W. Pollock, Esq., at
Ragsdale Liggett PLLC, in Raleigh, N.C., represents the Debtor as
special counsel.
The Bankruptcy Administrator was unable to appoint an official
committee of unsecured creditors in the Debtor's case.
SHOTWELL LANDFILL: Files Amended Schedules of Assets & Debts
------------------------------------------------------------
Shotwell Landfill, Inc., filed with the Bankruptcy Court for the
Eastern District of North California its amended schedules of
assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $2,900,000
B. Personal Property $20,143,736
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $9,675,268
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $393,389
----------- -----------
TOTAL $23,043,736 $10,038,658
About Shotwell Landfill, Inc.
Raleigh, North Carolina-based Shotwell Landfill, Inc., filed a
Chapter 11 petition (Bankr. E.D.N.C. Case No. 13-02590) in
Wilson on April 19, 2013. The Debtor disclosed $23,027,736 in
assets and $10,039,308 in liabilities as of the Chapter 11 filing.
Blake P. Barnard, Esq., William P. Janvier, Esq., and Samantha Y.
Moore, Esq., at the Janvier Law Firm, PLLC, in Raleigh, N.C.,
represent the Debtor as counsel. William W. Pollock, Esq., at
Ragsdale Liggett PLLC, in Raleigh, N.C., represents the Debtor as
special counsel.
The Bankruptcy Administrator was unable to appoint an official
committee of unsecured creditors in the Debtor's case.
SIMPLY WHEELZ: Seeks Bankruptcy as Hertz Talks Fail
---------------------------------------------------
Simply Wheelz LLC, which does business as Advantage Rent A Car,
filed for U.S. federal bankruptcy protection in the federal
bankruptcy courts of the State of Mississippi on Nov. 6.
First day motions with respect thereto have been scheduled for
November 7, 2013.
Franchise Services of North America Inc., which operates
Advantage, said in a Nov. 4 statement that it failed to reach a
deal to restructure vehicle lease agreements after Advantage
missed a payment to Hertz. Advantage had acquired 24,000 vehicles
from Hertz under the agreements. Simply Wheelz is a wholly owned
subsidiary of FSNA.
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that Advantage Rent A Car,
spun off by Hertz Global Holdings Inc. to win U.S. approval for
its purchase of Dollar Thrifty Automotive Group Inc., filed for
bankruptcy after talks with Hertz over vehicle lease payments
broke down.
The bankruptcy filing puts in jeopardy the Federal Trade
Commission's plan to create a viable competitor to Hertz as part
of its agreement to clear the $2.3 billion Dollar Thrifty
acquisition. The FTC gave final approval to the purchase in July,
ending an eight-month compliance review of the deal.
Advantage filed for bankruptcy after Hertz notified Franchise
Services on Nov. 2 that it was terminating the lease agreements
and seeking the return of vehicles that Advantage had acquired as
part of the Dollar Thrifty deal, according to the statement.
Advantage, based in Ridgeland, Mississippi, listed assets of
between $100 million and $500 million in its bankruptcy petition
filed on Nov. 5 in Jackson, Mississippi.
FTC's approval followed an investigation into how Macquarie Group
Ltd., which bought Advantage in a joint venture with Franchise
Services, was running the business, which the agency had
provisionally allowed, people familiar with the matter have said.
The commission is monitoring Franchise Services' bankruptcy "to
ensure compliance with the terms" of the order approving the
Dollar Thrifty acquisition, FTC spokesman Peter Kaplan said in an
e-mailed statement.
The FTC's investigation had focused on whether Macquarie was
following through on its commitments to expand and strengthen
Advantage after the Dec. 7 ouster of Sanford Miller, an industry
veteran who was hired to run it, two people familiar with the
matter said in April. Macquarie had said in an e-mail to Miller
that it didn't have car-rental experience.
Analysts and rental-car executives had said consolidation in the
industry was giving unprecedented pricing power to its market
leaders, first-ranked, closely held Enterprise Holdings Inc., No.
2 Hertz and Avis Budget Group Inc.
The FTC ordered Hertz to divest locations beyond the Advantage
business to protect consumers, citing the $11 billion spent to
rent 50 million vehicles at U.S. airports each year. Without the
divestitures, the merger would have hurt competition at 72
airports around the U.S., the agency said when it initially
approved the transaction on Nov. 15, 2012.
The case is In re Simply Wheelz LLC, U.S. Bankruptcy Court,
Southern District of Mississippi (Jackson).
About FSNA
Franchise Services of North America Inc. is a publicly traded
company listed on the TSX Venture Exchange. The Company and its
subsidiaries own the following brands: Advantage Rent A Car, U-
Save Car & Truck Rental(R), U-Save Car Sales, Rent-A-Wreck of
Canada, PractiCar, Auto Rental Resource Center, Xpress Rent A Car
and Peakstone Financial Services.
The Company operates the Advantage car rental brand at 72
corporate locations in 33 states including airport locations
servicing 60 of the top 70 airports across the United States.
Advantage is the fourth largest independent rental car company in
the United States.
U-Save, together with its subsidiary ARRC, has over 900 locations
throughout the United States and is one of North America's largest
franchise car rental companies. U-Save currently services 19
airport markets in 13 different states. Although primarily based
in the United States, U-Save has 18 international locations in
Mexico, Greece, the Middle East, Latin America, and the Caribbean.
Practicar Systems Inc. owns the rights to the Rent-A-Wreck(R) and
the PractiCar(R) trademarks for all of Canada. The Rent-A-
Wreck(R) system operates a network of 61 franchise locations from
coast-to-coast in Canada, providing a range of vehicle rental,
leasing and sales options to its customers. The Rent-A-Wreck(R)
system has been in continuous operation in Canada since 1976.
SIMPLY WHEELZ: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Simply Wheelz LLC
d/b/a Advantage Rent-A-Car
1052 Highland Colony Parkway, Suite 204
Ridgeland, MS 39157
Case No.: 13-03332
Chapter 11 Petition Date: November 5, 2013
Court: United States Bankruptcy Court
Southern District of Mississippi (Jackson Divisional
Office)
Judge: Hon. Edward Ellington
Debtor's Counsel: Christopher R. Maddux, Esq.
BUTLER SNOW O'MARA STEVENS & CANNADA
PO Box 6010
Ridgeland, MS 39158-6010
Tel: 601-985-4502
Fax: 601-985-4500
Email: chris.maddux@butlersnow.com
- and -
Stephen W. Rosenblatt, Esq.
BUTLER SNOW O'MARA STEVENS & CANNADA PLLC
P.O. Box 6010
Ridgeland, MS 39158-6010
Tel: 601-985-4504
Fax: 601-985-4500
Email: Steve.Rosenblatt@butlersnow.com
Estimated Assets: $100 million to $500 million
Estimated Liabilities: $100 million to $500 million
The petition was signed by Thomas P. McDonnell, III, chief
executive officer.
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Hertz Corporation $10,015,000
Attn: Perry Delvecchio
225 Brae Blvd.
Park Ridge, NJ 07656
Bank of America $7,500,000
Attn: C. Wertenberger
390 N. Orange Ave., S 900
Melbourne, FL 32901
Car Rentals.com $1,204,966
111 Town Sq. Place
Ste 1205
Jersey City, NJ 07310
TSD $1,073,394
1620 Turnpike Street
North Andover, MA 01845
GCA Services Group $1,048,760
Attn: Natalie Dunne
1350 Euclid St., S1500
Cleveland, OH 44115
Travelport LP $1,040,862
300 Galleria Parkway
Atlanta, GA 30339
Priceline.com, Inc. $682,176
800 Connecticut Ave.
Norwalk, CT 06854
Expedia, Inc. $494,395
333 108th Ave NE
Bellevue, WA 98004
Bank of America $491,982
Attn: C. Wertneberger
390 N. Orange Ave., S900
Melbourne, FL 32901
TAGS $475,196
Park West at Dulles Corner
13880 Dulles Corner Lane
Herndon, VA 20171
Orbitz $474,083
23508 Network Place
Chicago, IL 60673
Corepointe Insurance Co $417,358
401 S. Old Woodward Ave
Suite 300
Birmingham, Ml 48009
Southwest Airlines $301,283
Attn: Revenue Accounting
PO Box 97397
Dallas, TX 75397
Sonoran National Ins. Gr. $284,784
7502 E. Pinnacle Peak
Ste B210
Scottsdale, AZ 85255
United Healthcare $282,342
Attn: Christine Irish
9900 Bren Rd East
Hopkins, MN 55343
Fleetlogix $272,538
3590 Ketner Blvd
San Diego, CA 92101
Texas Dept. of Revenue $250,000
1711 San Jacinto Blvd
Austin, TX 78701
National Automobile Club $242,297
Attn: Landry Nix
373 Vintage Park, Ste E
San Mateo, CA 94404
Rate-Highway, Inc. $241,252
CA State Board of $240,000
Equalization
SOLOMONS ONE: Disgruntled Members Fail in Bid to Dismiss Case
-------------------------------------------------------------
Bankruptcy Judge Thomas J. Catliota rejected a request to dismiss
the chapter 11 petition filed by Solomons One, LLC, saying the
filing had the consent of members holding 51-2/3% of the
membership interests and was properly authorized in accordance
with the Debtor's operating agreement. V. Charles Donnelly and
Deborah A. Steffen, members of the Debtor, opposed the filing and
asked the Court to toss the petition because the Debtor's
operating agreement is silent on the requisite consent needed to
authorize a bankruptcy filing, and therefore Maryland law requires
unanimous consent of the members to do so. The Debtor and the
members who authorized the bankruptcy filing opposed the Dismissal
Motion, contending that the operating agreement authorizes a
filing upon consent of members holding a majority of the
interests.
A copy of Judge Catliota's Oct. 31, 2013 Memorandum of Decision is
available at http://is.gd/IuY7wTfrom Leagle.com.
Solomons One, LLC, is a limited liability company formed in 2005
under the laws of the State of Maryland. Solomons One's members,
and their purported ownership interests, are: Dr. Alfred
Greenberg, Halina Greenberg jointly 48-1/3%; Catherine Erickson-
File; 2-1/3%; Christine McNelis 1%; V. Charles Donnelly 24-1/3%;
and Deborah A. Steffen 24%.
On June 1, 2005, the members executed the Operating Agreement,
which provides that the Debtor was formed to acquire, purchase,
lease, sell and develop the real property located at 14538
Solomons Island Road, Solomons, Maryland. The Debtor entered into
a joint venture with McNelis to purchase the Property. In August
2005, the Debtor acquired a seventy percent fee simple interest in
the Property and McNelis acquired a thirty percent fee simple
interest. The Property includes a commercial office building,
which is leased out to several businesses, and a small cottage,
which is leased out as a residence.
Branch Banking and Trust Company holds a first lien on the
Property. The members of the Debtor are guarantors of the loan.
According to the Debtor, PNC Bank, N.A. may hold a second lien on
the Property and members are personally obligated on the PNC loan
either directly or as guarantors. The loans are in default, and
the bankruptcy petition was filed to stay a hearing scheduled for
Aug. 23, 2013, in BB&T's state court proceeding to liquidate its
obligation.
On August 21, 2013, in anticipation of the hearing, the members of
the Debtor held a meeting to consider whether to file a bankruptcy
petition. The Greenbergs, Erickson-File and McNelis, representing
51-2/3% of the member interests, voted in favor of the filing.
Donnelly and Steffen, holding 48-1/3% of the interests, voted
against the filing.
Solomons One, LLC, sought Chapter 11 protection (Bankr. D. Md.
Case No. 13-24475) on Aug. 23, 2013, listing under $1 million in
both assets and debts. Copies of the petition and list of
crditors are available at:
http://bankrupt.com/misc/mdb13-24475p.pdf
http://bankrupt.com/misc/mdb13-24475c.pdf
Solomons One is represented by Susan Jaffe Roberts, Esq., at
Whiteford, Taylor & Preston, LLP, as counsel.
SOUTH BAY LUBE: Case Closed Following Emergence from Chapter 11
---------------------------------------------------------------
The Honorable K. Rodney May has entered a final decree and order
closing South Bay Lube, Inc.'s chapter 11 proceeding following the
company's emergence from chapter 11 in April 2013 and resolution
of all creditors' claims.
The company's confirmed chapter 11 plan materially deleveraged the
company's balance sheet, while preserving equity ownership and
operation of its locations under a consensual plan achieved
following lengthy and significant negotiations with secured
creditors (notably, GE Capital Commercial, Inc., owed more than $9
million, who took prepetition action to have a receiver appointed)
and more than a score of landlords.
Sarasota, Florida-based South Bay Lube, Inc., with about 200
employees operating 22 Jiffy Lube stores throughout central and
south Florida and generating about $14 million in annual revenue,
filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 12-07356)
on May 11, 2012, represented by Edward J. Peterson, III, Esq. --
epeterson@srbp.com -- and Stephen R. Leslie, Esq. -- srl@srbp.com
-- at Stichter, Riedel, Blain & Prosser, P.A., in Tampa, Fla.
SPECIALTY PRODUCTS: Ch. 11 Must Have Asbestos Claims Deadline
-------------------------------------------------------------
Law360 reported that a Delaware bankruptcy judge said on Nov. 5
that there must be a deadline set for asbestos-related personal
injury claimants to file proofs of claim in the Specialty Products
Holding Corp. case, despite strenuous objections from
representatives of those claimants who argued it could shut out
thousands of potential claims.
According to the report, an attorney for Eric D. Green, the
representative for future asbestos claimants, argued at a hearing
in Wilmington that a claims bar date would serve no purpose.
About Specialty Products
Cleveland, Ohio-based Specialty Products Holdings Corp., aka RPM,
Inc., is a wholly owned subsidiary of RPM International Inc. The
Company is the holding company parent of Bondex International,
Inc., and the direct or indirect parent of certain additional
domestic and foreign subsidiaries. The Company claims to be a
leading manufacturer, distributor and seller of various specialty
chemical product lines, including exterior insulating finishing
systems, powder coatings, fluorescent colorants and pigments,
cleaning and protection products, fuel additives, wood treatments
and coatings and sealants, in both the industrial and consumer
markets.
The Company filed for Chapter 11 bankruptcy protection (Bankr. D.
Del. Case No. 10-11780) on May 31, 2010. Gregory M. Gordon, Esq.,
Dan B. Prieto, Esq., and Robert J. Jud, Esq., at Jones Day, serve
as bankruptcy counsel. Daniel J. DeFranceschi, Esq., and Zachary
I. Shapiro, Esq., at Richards Layton & Finger, serve as co-
counsel. Logan and Company is the Company's claims and notice
agent. The Company estimated its assets and debts at $100 million
to $500 million.
The Company's affiliate, Bondex International, Inc., filed a
separate Chapter 11 petition on May 31, 2010 (Case No. 10-11779),
estimating its assets and debts at $100 million to $500 million.
On May 20, 2013, the Bankruptcy Court entered an order estimating
the amount of the Debtors' asbestos liabilities, and a related
memorandum opinion in support of the estimation order. The
Bankruptcy Court estimated the current and future asbestos claims
associated with Bondex International, Inc. and Specialty Products
Holding at approximately $1.17 billion. The estimation hearing
represents one step in the legal process in helping to determine
the amount of potential funding for a 524(g) asbestos trust.
STOCKTON, CA: Sales Tax Plan Set to End Ch. 9; Pensions Spared
--------------------------------------------------------------
Jim Christie, writing for Reuters, reported that when Stockton,
California, filed for bankruptcy last year, the stage was set for
a precedent-setting battle with Wall Street over whether
bondholders or retired public employees should pay the price when
a local government goes broke. But under the terms of recent
settlements, bond insurers who are backing about $240 million in
city debt will accept a "haircut" of as much as 50 percent on some
bonds.
According to the report, retirees will keep their full pensions,
though 1,100 of them will lose their retiree health insurance.
On Nov. 5, Stockton voters are likely to approve a sales tax
increase that could all but seal a surprisingly speedy end to the
city's bankruptcy case, the report said. With that, the much-
anticipated showdown over pensions will move to Detroit or another
city seeking court protection from creditors.
Massive cuts to Stockton's budget will remain, the report noted.
The sales tax increase will raise about $300 million over 10 years
and likely enable the city to emerge from bankruptcy early next
year.
"We got reform. We just got it a different way than everybody
wanted," said City Manager Bob Deis, who recently retired and is
credited with driving a tough but well-organized bankruptcy
process, the report related.
About Stockton, Calif.
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.
STOCKTON, CA: Tax Vote Puts City on Track for Solvency
------------------------------------------------------
Jim Christie, writing for Reuters, reported that voters in
Stockton, California approved a tax hike on Nov. 5, putting a city
that had been regarded as a test case of pension spending in U.S.
municipal bankruptcies closer to regaining solvency.
According to the report, until Detroit filed for bankruptcy
earlier this year, the city of roughly 300,000 residents in
California's Central Valley had been the biggest U.S. city to file
for legal protection from its creditors.
The increase in the sales tax in Stockton from 8.25 percent to 9
percent will raise about $300 million over 10 years and allow the
city to move on with restructuring its finances and hire more than
100 additional police officers, the report related.
Those priorities were potent selling points for a crime plagued
city where services have been slashed in recent years, said Jack
Pitney, professor of government at Claremont McKenna College, the
report cited.
Some 52.5 percent of voters approved the measure compared to 47.5
percent who opposed it, results showed, the report said.
About Stockton, Calif.
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.
SUNTECH POWER: To Stop Making Solar Panels
------------------------------------------
Wayne Ma, writing for The Wall Street Journal, reported that
Suntech Power Holdings Co. revealed for the first time that it
plans to emerge from bankruptcy restructuring as a distributor --
rather than a producer -- of solar panels. But the plan, laid out
in a court filing on Nov. 5, quickly drew criticism from a U.S.
bondholder.
Suntech, once the world's largest solar-panel maker, will move
away from manufacturing panels and become a seller and distributor
of solar equipment, according to a court filing.
The company will "benefit from the supply of cheap solar panels
currently available from competitors in the market," Chairman
Michael Nacson said in the filing, the WSJ report related.
Suntech will focus on its panel installation and could outsource
production, the filing said.
Though Suntech is "cash-flow insolvent and may also be balance-
sheet insolvent. . . it will be possible to achieve a
restructuring to return Suntech and its subsidiaries to solvency,"
the filing said, according to the report. Mr. Nacson didn't reply
to a request for comment.
Colin Peterson, managing director at distressed-debt hedge fund
Trondheim Capital LLC, said he was skeptical that Suntech would be
viable without manufacturing assets, the report further related.
Mr. Peterson holds about $1 million in Suntech bonds and is
leading the charge to put the company into involuntary bankruptcy
in the U.S.
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.
Suntech Power Holdings Co., Ltd., received from the trustee of its
3 percent 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.
Suntech Power had involuntary Chapter 7 bankruptcy proceedings
initiated against it on Oct. 14, 2013 in U.S. Bankruptcy Court in
White Plains, New York (Bankr. S.D.N.Y. Case No. 13-bk-13350), by
holders of more than $1.5 million of defaulted securities under a
2008 $575 million indenture. The Chapter 7 Petitioners are
Trondheim Capital Partners, L.P., Michael Meixler, Longball
Holdings, LLC, and Jiangsu Liquidators, LLC. They are represented
by Jay Teitelbaum, Esq., at TEITELBAUM & BASKIN LLP, in White
Plains, New York.
TOWNSQUARE RADIO: Moody's Rates New $145MM Sr. Notes 'B3'
---------------------------------------------------------
Moody's Investors Service assigned B3 to Townsquare Radio, LLC's
tack-on $145 million 9% senior notes being issued to partially
fund the $229 million acquisition of Cumulus Media's 50 radio
stations and the $52 million acquisition of Peak II Holding's 11
radio stations. In addition, Moody's affirmed the company's B2
Corporate Family Rating (CFR), B2-PD Probability of Default
Ratings (PDR) and B3 on the existing 9% senior notes. The rating
outlook is stable.
Assigned:
Issuer: Townsquare Radio, LLC & Townsquare Radio, Inc.
NEW $145 million of 9% Senior Notes due 2019: Assigned B3, LGD4
-- 66%
Affirmed:
Issuer: Townsquare Radio, LLC
Corporate Family Rating: Affirmed B2
Probability of Default Rating: Affirmed B2-PD
Issuer: Townsquare Radio, LLC
EXISTING $265 million of 9% Senior Notes due 2019: Affirmed B3,
LGD4 -- 66% (from LGD4 - 58%)
Outlook Actions:
Issuer: Townsquare Radio, LLC
Outlook is Stable
Ratings Rationale:
The B2 corporate family rating reflects the company's high debt-
to-EBITDA of 6.3x estimated for December 31, 2013 (including
Moody's standard adjustments, or 6.0x excluding holdco PIK Notes),
and pro forma for the pending transactions to acquire additional
radio stations from Cumulus Media and from Peak II Holding
followed by an exchange of certain stations with Cumulus Media.
Leverage has remained elevated since the July 2012 funding of debt
facilities due to acquisitions, underperformance of stations
acquired from Cumulus Media in 2012, and prior economic weakness
in New Jersey markets, a key region for Townsquare. Looking
forward, Moody's expects leverage to remain elevated given the
potential for additional acquisitions or for the funding of
restricted payments, a portion of which could be used to reduce
the outstanding amount of new 10% PIK Notes issued by an indirect
holding company (Townsquare Media, LLC). As proposed, the $30
million of holdco PIK Notes due 2019 are unguaranteed by
Townsquare, are secured by a pledge of holdco's equity in
Townsquare among other collateral, and will be issued to partially
fund the pending transactions. Proposed funding also includes
issuance of $16.6 million of equity consideration allowing the
company to remain in compliance with the 2.40x senior leverage
test under its credit agreement as well as the 2.0x senior
leverage and 6.0x total leverage incurrence tests under its
indenture.
The B2 CFR is forward looking and reflects Moody's expectation
that leverage will improve to 6.0x (or 5.7x excluding holdco PIK
Notes) over the next 12 months which still positions Townsquare
weakly in the B2 rating. Ratings also incorporate risks associated
with assimilating pending acquisitions, the potential for reduced
liquidity to the extent restricted payments are funded, as well as
the mature and cyclical nature of radio advertising demand.
Moody's believes leverage should be reduced to provide some
financial cushion given uncertainties related to local and
national economic weakness as well as heightened competition for
local ad dollars. Ratings are supported by the company's leading
revenue share (#1 or #2 rank in the vast majority of it 66
markets) and audience ratings. Management is focused on growing
local advertising revenue in small to mid-sized markets with
cross-promotion capabilities using its digital and live events
businesses. Approximately 89% of its markets are ranked between
#100 and #300 by population, and Moody's believes that competition
is limited in these locations given deeper-pocketed radio
broadcasters have chosen to operate primarily in larger sized
markets. These initiatives along with an overall improving economy
and efforts to grow digital as well as event revenue will support
flat to low single-digit percentage revenue and EBITDA growth over
the next 12 months. For Townsquare, a serial acquirer of radio
stations, the pending transaction mark its fifth significant
addition in the past three years, bringing its total roster of
radio stations to 312 in 66 markets. In contrast to traditional
radio operators, executive management has diverse media experience
and does not come exclusively from legacy broadcasters. Moody's
believes the company has effectively grown non-traditional revenue
from digital services and events which adds to mature radio
broadcast revenue. Liquidity is good with $15 million of
unrestricted cash as of June 30, 2013, expectations for at least
3% free cash flow-to-debt ratios over the next 12-18 months in the
absence of restricted payments, and no significant maturities
until April 2016 when the undrawn revolver expires.
The stable outlook reflects Moody's view that the company will
generate flat to modest revenue growth on a same-station basis
consistent with Moody's expectations for the overall radio
industry. The outlook incorporates Moody's expectation that debt-
to-EBITDA ratios will not increase above current levels and that
there will be no additional issuances of PIK Notes by parent
holding companies. Notwithstanding the ability to fund permitted
levels of restricted payments, a portion of which could be applied
to redeem PIK Notes, the outlook reflects the company maintaining
at least adequate liquidity and does not incorporate debt financed
acquisitions that would increase debt-to-EBITDA ratios above 6.0x
(including Moody's standard adjustments). Debt ratings could be
downgraded if performance were to deteriorate due to increased
competition, economic weakness in one or more key markets, or
unexpected delays in assimilating acquired stations. Weakened
liquidity, due in part to funding of investments or restricted
payments, or additional debt financed acquisitions resulting in
debt-to-EBITDA ratios being sustained above current levels could
also result in a downgrade. Although not likely given management's
acquisition strategy and the potential for shareholder
distributions, ratings could be upgraded if debt-to-EBITDA ratios
are sustained comfortably below 5.0x with free cash flow-to-debt
ratios remaining above 7% (including Moody's standard
adjustments). Liquidity would need to remain good and Moody's
would need assurances that the company would operate in a
financially prudent manner consistent with a higher rating.
Townsquare Radio, LLC is a privately held media company that will
own and operate 312 radio stations, related websites, and over 400
annual live events in 66 small to mid-sized markets with most of
the stations operating in markets ranked #100 - #300 based on
population. Headquartered in Greenwich, CT, the predecessor
company was formerly known as Regent Communications and emerged
from Chapter 11 protection in April 2010 with 60 stations in 13
markets. Subsequent to emerging, the company acquired additional
small to mid-sized market stations from GAP Radio Broadcasting,
Millennium Radio Group, Double O Corporation, and Cumulus Media.
Shareholders include prior debt holders, the largest of which are
Oaktree Capital, GE Capital, and MSD Capital. Estimated revenue
pro forma for announced transactions for the 12 months ended June
2013 total roughly $330 million.
TOWNSQUARE RADIO: S&P Retains 'B' Rating Following $137MM Add-On
----------------------------------------------------------------
Standard & Poor's Ratings Services said its 'B' issue-level rating
on U.S. radio broadcaster Townsquare Radio LLC's senior notes is
unchanged following the company's announcement of its proposed
$137 million tack-on financing. The recovery rating on the debt
remains '4', reflecting S&P's expectation for average (30%-50%)
recovery in the event of a payment default. Townsquare is also
issuing $102 million of incremental term loan debt (unrated).
S&P expects the company will use proceeds to finance the
acquisition of Peak II Holdings and 50 radio stations from Cumulus
Media Holdings Inc. In conjunction with the acquisition,
Townsquare plans to exchange five Peak radio stations for 15
Cumulus radio stations.
The 'B' corporate credit rating is based on S&P's assessment of
the company's business risk profile as "weak" and financial risk
profile as "highly leveraged," according to its criteria. S&P
views Townsquare's business risk profile as weak because of risks
related to longer-term structural issues facing the radio industry
and the company's small market presence, which S&P believes
contributes to a lower EBITDA margin.
Pro forma for the acquisition and asset exchange, Townsquare will
increase its radio station portfolio by roughly 30%, making it the
third largest U.S. radio station operator by number of stations,
with 312 radio stations in 66 small-to-midsize markets in the U.S.
Although such markets have less competition from large, well-
capitalized radio broadcasters, they offer smaller total ad
revenue and cash flow opportunities compared with top-100 markets,
and typically attract considerably less national advertising, a
potential source of revenue diversification.
"We assess Townsquare's financial risk profile as highly leveraged
because of the company's high debt-to-EBITDA ratio. Pro forma
lease-adjusted debt to EBITDA was 6.7x as of June 30, 2013, and
increases to a very high 7.7x when including the preferred equity
at the holding company. We recognize that the preferred equity
provides the company with financial flexibility, which we
incorporate qualitatively into the rating. Nevertheless, we
believe the preferred units are unlikely to be a permanent part of
the holding company's capital structure given the incentives of
the private equity shareholders to seek a return on their
investment, potentially over an intermediate horizon. We expect
leverage to remain high over the intermediate term," S&P said.
RATINGS LIST
Townsquare Radio LLC
Corporate Credit Rating B/Stable/--
Ratings Unchanged
Townsquare Radio LLC
Senior Unsecured
$402M* notes due 2019 B
Recovery Rating 4
*Includes $137M add-on.
TRIAD GUARANTY: Exclusive Plan Periods Extension Approved
---------------------------------------------------------
BankruptcyData reported that the U.S. Bankruptcy Court approved
Triad Guaranty's motion to extend the exclusive period during
which the Company can file a Chapter 11 plan and solicit
acceptances thereof through and including March 30, 2014 and
May 29, 2014, respectively.
As previously reported, "The Debtor believes that it is prudent,
and appropriate from a cost-benefit standpoint, to seek an
extension of the Exclusive Periods. The plan process only can
begin in earnest after the adjudication of the Adversary
Proceeding and the Trading Motion. The Debtor intends to move the
plan process forward as quickly as is feasible. However, the
pendency of those matters effectively prevents the Debtor from
formulating and proposing a plan at this time. Meanwhile, during
the course of this case, the Debtor has timely met its reporting
obligations, and has moved decisively to address the matters of
critical importance to the Debtor in this case, including by
preserving its tax attributes through the protections set forth in
the interim orders respecting the Trading Motion, seeking an
adjudication of its rights as it relates to the tax attributes
through the Adversary Proceeding, and negotiating and seeking
court approval of an amicable resolution of the Securities
Litigation. In addition, the Debtor is pursuing - and has received
expressions of interest in - an infusion of cash either through
debtor-in-possession financing or through a mechanism provided for
in a plan."
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.
TMT GROUP: Unsecured Creditors Demand End to Litigation Wave
------------------------------------------------------------
Law360 reported that TMT Group's unsecured creditors asked a Texas
bankruptcy judge on Nov. 4 to force the troubled shipping company
and its secured lenders to negotiate a business plan aimed at
exiting Chapter 11, saying ongoing litigation propelled by senior
creditors is rapidly depleting the company's cash.
According to the report, TMT's official committee of unsecured
creditors said in a motion to compel mediation that a group of the
company's lenders including Cathay United Bank Co. Ltd. and Mega
International Commercial Bank Co. Ltd. are eroding its cash "at an
alarming and unprecedented pace."
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, including C. Ladybug Corporation,
sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 13-
33740) in Houston, Texas, on June 20, 2013 after lenders seized
seven vessels.
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 already filed a lawsuit in U.S. bankruptcy court aimed at
forcing creditors to release the vessels so they can return to
generating income.
TTM TECHNOLOGIES: S&P Assigns Prelim. 'B+' Sub. Issue Level Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary 'BBB-'
senior secured issue-level rating, preliminary 'BB' senior
unsecured issue-level rating, and preliminary 'B+' subordinated
issue-level rating to the $250 million shelf filed by Costa Mesa,
Calif.-based TTM Technologies Inc. The company may sell a
combination of common stock, preferred stock, debt securities,
warrants, and units. Proceeds will go toward general corporate
purposes, which S&P believes would likely include refinancing
indebtedness, acquisitions, or other business investments. All
other ratings on TTM, including the 'BB/Stable/--' corporate
credit rating, remain unchanged.
The ratings on TTM reflect S&P's view of its "significant"
financial risk profile with leverage in the low 3x area and
interest coverage of more than 6x at September 2013, and its
"weak" business risk profile derived from the highly fragmented
and competitive printed circuit board industry, meaningful
customer concentration, exposure to cyclical network
infrastructure and information technology spending, and low
revenue visibility. Partially offsetting these factors, in S&P's
view, are TTM's diverse end markets and a product mix that is
shifting to high-performance, high-margin products.
RATINGS LIST
TTM Technologies Inc.
Corporate credit rating BB/Stable/--
New Rating
TTM Technologies Inc.
Senior secured BBB-(prelim)
Senior unsecured BB(prelim)
Subordinated B+(prelim)
VELTI INC: Wins Court Approval of Interim Bankruptcy Financing
--------------------------------------------------------------
Michael Bathon, substituting for Bill Rochelle, the bankruptcy
columnist for Bloomberg News, reports that Velti Inc. received
court approval of a loan to help fund operations while it's in
bankruptcy.
According to the report, U.S. Bankruptcy Judge Peter Walsh
approved the interim financing at a hearing on Nov. 5 in
Wilmington, Delaware.
The company will return to seek court approval of the rest of the
$25 million in bankruptcy financing from units of GSO Capital
Partners LP, the credit division of Blackstone Group LP.
The $6.3 million in interim financing will be split between the
businesses. The U.S. units will receive about $2.2 million and the
remainder will go to the U.K. units.
The company plans to auction some assets with an affiliate of GSO
Capital Partners acting as the initial, or "stalking-horse,"
bidder.
While the business lines of Air2Web's India unit and Velti's U.K.
operations, including Mobile Interactive Group Ltd., are included
in the proposed sale, those entities aren't part of the bankruptcy
and are continuing normal operations, Velti Chief Executive
Officer Alex Moukas said in a phone interview before the filing.
A hearing to approve a sales process for the business lines and
approve GSO as the stalking-horse bidder in the bankruptcy auction
is scheduled for Nov. 18.
About Velti Inc.
Velti Inc., a provider of technology for marketing on mobile
devices, sought Chapter 11 protection (Bankr. D. Del. Case No. 13-
bk-12878) on Nov. 4.
Velti Inc., a San Francisco-based unit of Velti Plc, listed assets
of as much $50 million and debt of as much as $100 million in
Chapter 11 documents filed this week. Its Air2Web Inc. unit,
based in Atlanta, also sought creditor protection.
Velti Plc, which trades on the Nasdaq Stock Market, isn't part of
the bankruptcy process. Operations in the U.K., Greece, India,
China, Brazil, Russia, the United Arab Emirates and elsewhere
outside the U.S. didn't seek protection and business there will
continue as usual.
VELTI INC: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor entities filing separate Chapter 11 cases:
Debtor Case No.
------ --------
Velti Inc. 13-12878
aka Velti USA, Inc.
aka AdInfuse, Inc.
Spear Tower
1 Market Street, Suite 1400
San Francisco, CA 94105
Air2Web, Inc. 13-12879
3424 Peachtree Road, Suite 400
Atlanta, GA 30326
Air2Web Interactive, Inc. 13-12880
3424 Peachtree Road NE, Suite 400
Atlanta, GA 30326
Velti North America Holdings, Inc. 13-12882
Spear Tower
1 Market Street, Suite 1400
San Francisco, CA 94105
Velti North America, Inc. 13-12881
Spear Tower
1 Market Street, Suite 1400
San Francisco, CA 94105
Velti US Holdings, Inc. 13-12883
Spear Tower
1 Market Street, Suite 1400
San Francisco, CA 94105
Chapter 11 Petition Date: November 4, 2013
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Hon. Peter J. Walsh
Debtors' Counsel: Stuart M. Brown, Esq.
DLA PIPER LLP (US)
1201 North Market Street, Suite 2100
Wilmington, DE 19801
Tel: 302-468-5640
Fax: 302-778-7913
Email: stuart.brown@dlapiper.com
Debtors' Claims BMC Group, Inc.
Agent:
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $50 million to $100 million
The petition was signed Sally Rau, secretary.
Consolidated List of Debtors' 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
T-Mobile USA, Inc. Trade Debt $1,000,000
P.O. Box 742596
Cincinnati, Ohio 45274-2596
PPF Paramount One Market LP Trade Debt $386,411
1633 Broadway, Suite 1801
New York, New York 10019
Sprint (Kansas City) Trade Debt $226,089
Cogniance, Inc. Trade Debt $178,535
Armanino LLP Trade Debt $159,560
Jesper Helt Employee $150,000
Obligation
Amazon Web Services, LLC Trade Debt $146,681
Mobile Marketing Association Trade Debt $125,000
SutherlandGold Group Trade Debt $106,000
TELECORDIA Trade Debt $93,296
Operative Media, Inc. Trade Debt $91,440
BSD Michael 101 LLC Trade Debt $89,951
Moolah Media Trade Debt $83,797
Airplus International Trade Debt $80,082
Jones Lang LaSalle Trade Debt $75,000
Napoleon Contracting Corp. Trade Debt $71,659
Pearl Meyer & Partners, LLC Trade Debt $71,358
SALESFORCE.COM Trade Debt $67,327
San Francisco Tax Collector Government $56,098
Obligation
Elastic Creative, Inc. Trade Debt $56,000
VINEYARD BANK: Calif. Court Sticks XL With $9MM Payout in D&O Case
------------------------------------------------------------------
Law360 reported that a California appeals court affirmed on Nov. 4
that XL Specialty Insurance Co. cannot recover $9.3 million in
excess coverage that settled a creditors' suit against directors
and officers of a failed bank, ruling the payment cleared XL of
alleged bad faith and should not fall on the bank's primary D&O
insurer.
According to the report, a unanimous panel soundly rejected an XL
lawsuit arguing that St. Paul Mercury Insurance Co. should split
the cost because XL's payment released insured directors and
officers of defunct Vineyard Bank.
About Vineyard Bank
Vineyard Bank, National Association, Rancho Cucamonga, California,
was closed July 17, 2009 by the Office of the Comptroller of the
Currency, which appointed the Federal Deposit Insurance
Corporation as receiver. To protect the depositors, the FDIC
entered into a purchase and assumption agreement with California
Bank & Trust, San Diego, California, to assume all of the deposits
of Vineyard Bank, N.A., excluding those from brokers.
As of March 31, 2009, Vineyard Bank, N.A. had total assets of $1.9
billion and total deposits of approximately $1.6 billion. In
addition to assuming all of the deposits of the failed bank,
California Bank & Trust agreed to purchase approximately $1.8
billion of assets. The FDIC will retain the remaining assets for
later disposition.
VUZIX CORP: Gets TSX Venture Exchange Delisting Notice
------------------------------------------------------
Vuzix Corporation on Nov. 4 advised that, further to its: (i)
Amendment No. 5 to its Registration Statement (filed on Form S-1)
filed with applicable securities regulators on July 29, 2013; (ii)
pricing prospectus dated July 30, 2013 filed with applicable
securities regulators on July 30, 2013; and (iii) press releases
dated July 30, 2013 and July 31, 2013, Vuzix on Nov. 4 received a
delisting notice from TSX Venture Exchange advising that the
shares of Vuzix common stock (symbol VZX) will be delisted from
the TSX Venture Exchange as a result of the common stock being
sold and issued at a greater than 20% discount to the then current
market price. And while Vuzix is disappointed with the delisting
and acknowledges the transaction was closed without the TSXV
Venture Exchange's approval despite its efforts to secure such
approvals, it stands by its decision that concluding the offering
was in the best interests of the shareholders of Vuzix based on
its financial position at the time. The shares of Vuzix have been
suspended from trading on the TSX Venture Exchange since July 31,
2013 (former symbol tsx-v:VZX). The shares will be delisted
effective as of November 13, 2013. Vuzix shares remain listed on
the OTCQB market place listed under the symbol "VUZI."
About Vuzix Corporation
Vuzix -- http://www.vuzix.com-- is a supplier of Video Eyewear
products in the consumer, commercial and entertainment markets.
The Company's products, personal display devices that offer users
a portable high quality viewing experience, provide solutions for
mobility, wearable displays and virtual and augmented reality.
Vuzix holds 33 patents and 15 additional patents pending and
numerous IP licenses in the Video Eyewear field. Founded in 1997,
Vuzix is a public company with offices in Rochester, NY, Oxford,
UK and Tokyo, Japan.
WESTERN FUNDING: Section 341(a) Meeting to be Held Today
--------------------------------------------------------
A meeting of creditors in the bankruptcy case of Western Funding
Inc. and its debtor-affiliates will be held on Nov. 7, 2013, at
12:00 p.m. at 341s - Foley Building, Room 1500.
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 Western Funding Inc.
Las Vegas car-loan maker Western Funding Inc., whose customers
usually have less-than-perfect credit, filed for Chapter 11
bankruptcy protection (Bankr. D. Nev., Case No. 13-17588) on
Sept. 4, 2013, after its own lender said the company broke
borrowing promises made last year. Matthew C. Zirzow, Esq., at
Larson & Zirzow, LLC, in Las Vegas, Nevada, represents the Debtor.
WIEN BAKERY: Calif. Appeals Court Okays Receiver's Final Report
---------------------------------------------------------------
The Court of Appeals of California, Second District, Division
Four, affirmed a trial court's order approving and settling the
final report and accounting of Kevin Singer, the receiver for Wien
Bakery LLC, and approving final compensation for Mr. Singer. Sung
J. Lee appealed from the trial court's order, saying the lower
court abused its discretion in requiring him to pay the fees and
expenses incurred by Mr. Singer in taking over and operating the
Bakery, which generated insufficient income to provide either a
recovery for Mr. Lee or payment to Mr. Singer.
Mr. Lee obtained a judgment against the Bakery, his former
employer, in the amount of $362,364, representing unpaid wages and
penalties. The judgment provided for appointment of a receiver
pursuant to Business and Professions Code section 17203. Mr. Lee
moved ex parte for an order appointing Mr. Singer as the receiver.
The Appeals Court found "no abuse of discretion" in affirming the
decision.
The case is SUNG J. LEE, Plaintiff and Appellant, v. WIEN BAKERY
LLC, et al., Defendant; KEVIN SINGER, as receiver etc., Movant and
Respondent, No. B241325 (Calif. App.). A copy of the Appeals
Court's Nov. 4 decision is available at http://is.gd/mTgMimfrom
Leagle.com.
Henry M. Lee, Esq., and Robert Myong, Esq., represent Mr. Lee.
Ervin Cohen & Jessup, Byron Z. Moldo, Esq., and Matthew J. Eandi,
Esq., represent Mr. Singer. They may be reached at:
Byron Z. Moldo, Esq.
Matthew Eandi, Esq.
ERVIN COHEN & JESSUP LLP
9401 Wilshire Blvd., 9th Floor
Beverly Hills, CA 90212-2974
Tel: (310) 273-6333
Fax: (310) 859-2325
E-mail: moldo@ecjlaw.com
mjeandi@ecjlaw.com
Data compiled by the Troubled Company Reporter show Wien Bakery
LLC sought bankruptcy protection three times since September 2010.
Wien Bakery LLC filed a Chapter 11 bankruptcy petition (Bankr.
C.D. Calif. Case No. 11-40874) in Los Angeles on July 19, 2011,
listing under $1 million in both assets and debts. A copy of the
petition is available at http://bankrupt.com/misc/cacb11-40874.pdf
It also filed a petition (Bankr. C.D. Calif. Case No. 11-15013) on
Feb. 4, 2011, listing between $1 million to $10 million in both
assets and debts. Robert Y. Lee, Esq., at Lee Law Group APLC,
represented by bakery in the February 2011 filing. The petition
was signed by Hae Duk Kim, owner and controlling shareholder.
The Bakery also filed a petition (Bankr. C.D. Calif. Case No.
10-48843) on Sept. 13, 2010. Judge Barry Russell oversaw the 2010
case. Lee Law Group APLC served as counsel in the 2010 case. The
2010 petition was also signed by Hae Duk Kim, owner and
controlling shareholder.
* SAC Capital Plea Set for Nov. 8
---------------------------------
Christopher M. Matthews, writing for The Wall Street Journal,
reported that the blockbuster $1.2 billion insider-trading
settlement between SAC Capital Advisors LP and the U.S. government
has two more hurdles to clear. Both of them are federal judges in
Manhattan.
According to the report, if either of the judges doesn't approve
the settlement, SAC could walk away from its agreement with the
federal prosecutors and try to fight the criminal indictment.
The plea agreement is a global settlement that would resolve two
separate cases, one criminal and one civil, the report related.
On the morning of Nov. 6, U.S. District Judge Richard Sullivan
will hold a hearing on the civil piece of the case -- a $900
million civil forfeiture reduced to $284 million because SAC
received credit for a pending $616 million settlement with the
Securities and Exchange Commission. On the afternoon of Nov. 8,
Judge Laura Swain will hold a hearing on the $900 million criminal
fine.
The plea bargain is a hard-fought and high-profile win by
prosecutors in their long running campaign against insider
trading, and there will be a lot of pressure to get it approved,
the report noted. And such deals are also often delicate
structures, created through painstaking negotiations, and neither
side typically wants a judge disrupting months of work. But the
unusual legal terms of the deal and the involvement of two judges
have created atypical risks that the deal could be blown up.
When Judge Swain examines the agreement on Nov. 8 her only option
will be to give the deal a thumbs up or a thumbs down, the report
said. If she rejects the deal, SAC Capital can withdraw its guilty
plea, because of a unique clause in the settlement terms.
* Wells Fargo Said to Face U.S. Mortgage-Bond Probe
---------------------------------------------------
Keri Geiger, writing for Bloomberg News, reported that Wells Fargo
& Co. is among firms facing federal scrutiny of mortgage-bond
sales under a 1989 law the government is using to extend probes of
banks' roles in the credit crisis, two people with knowledge of
the matter said.
According to the report, U.S. attorneys in San Francisco have been
examining Wells Fargo, the nation's largest mortgage lender, for
more than a year, said one of the people, who asked not to be
named because the inquiry isn't public. Authorities are
investigating whether the firm violated the Financial Institution
Reform and Recovery Act. The law, known as FIRREA, carries a 10-
year statute of limitations and allows the government to sue for
fraud affecting a federally insured financial institution.
President Barack Obama set up a task force last year that's making
use of the law, which stems from the savings-and-loan crisis of
the 1980s, while examining mortgage-bond underwriting that fueled
investor losses and prompted unprecedented government bailouts of
banks in 2008, the report related. The task force, comprising
state and federal agencies, is focusing on about eight banks, a
person familiar with the matter said in October.
Bank of America Corp., Zurich-based Credit Suisse Group AG, and
New York-based JPMorgan Chase & Co., and Citigroup Inc. also are
among firms facing FIRREA investigations, people familiar with
those inquiries said in August and October, the report further
related.
Oscar Suris, a spokesman for San Francisco-based Wells Fargo, and
Josh Eaton, a spokesman for U.S. Attorney Melinda Haag, declined
to comment, the report said.
* Annual Payments Not Needed For IRA Tax Benefit: 8th Circ.
-----------------------------------------------------------
Law360 reported that the Eighth Circuit ruled on Nov. 4 that a
Minnesota retiree's rolled-over individual retirement annuity is
exempt from bankruptcy creditors, saying individuals do not need
to make annual contributions toward their retirement annuities to
maintain IRA tax benefits.
According to the report, the decision shoots down a bankruptcy
trustee's argument that annual premiums are prerequisites of
qualified IRAs under Section 408(b) of the Internal Revenue Code.
The Eighth Circuit said annual contributions are discretionary
and, if they are required, the statute is in place to cap the
amount of money individuals can recover.
The appeal is Terri A. Running v. Joseph Matthias Miller, Case No.
13-6026 (8th Cir.).
* Debt Collectors Face New Rules under CFPB Proposal
----------------------------------------------------
Danielle Douglas, writing for The Washington Post, reported that
the government is preparing restrictions on debt collectors, a
loosely regulated industry under increasing scrutiny over
complaints of abusive tactics.
According to the report, on Nov. 6, the Consumer Financial
Protection Bureau is slated to issue a notice of proposed
rulemaking to modernize the legal framework governing debt
collection. The government watchdog is seeking public and business
comment before formally proposing the rules, which are expected to
be finalized by next year.
The bureau is asking Americans whether creditors and collection
agencies are providing accurate information about their
outstanding debts, the report related. It also wants to know
whether people are receiving threatening calls at all hours of the
night or being dragged into court for money they do not owe.
"Collection of consumer debts serves an important role in the
proper functioning of consumer credit markets," CFPB Director
Richard Cordray said on Nov. 5 on a call with reporters, the
report cited. "But certain debt collection practices have long
been a source of frustration for many consumers."
Cordray noted that since the bureau began accepting debt
collection complaints in July, it has received about 5,000
consumer grievances, the report further related. The most-common
complaints involve harassing phone calls, lack of verification of
the debt and people becoming aware of a collection account only
through their credit report.
* Roetzel Gets Tier 1 Best Law Firms Ranking in Bankruptcy Law
-------------------------------------------------------------
Roetzel on Nov. 5 announced its inclusion in the Best Law Firms
list for 2013-2014, published by U.S. News & World Report in
conjunction with Best Lawyers(R). Roetzel received national
Tier 3 rankings in Financial Services Regulation Law, Litigation
- Antitrust, Litigation - Construction, Transportation Law and
Commercial Litigation.
"We are gratified to once again be chosen as one of the nation's
top law firms," said Jeffrey Casto, Roetzel's Chairman and CEO.
"Our continuing presence on the Best Law Firms list serves to
underscore our ongoing commitment to provide our clients with
superior service across a broad range of legal disciplines. We
are enormously proud to be held in such high esteem by our clients
and peers."
"Best Law Firms" rankings are based primarily on client surveys
and peer evaluations by other firms in the same practice areas.
Roetzel also achieved Tier 1 metropolitan rankings in 26
additional areas of practice including:
-- Banking and Finance Law
-- Bankruptcy and Creditor Debtor Rights / Insolvency and
Reorganization Law
-- Commercial Litigation
-- Employment Law - Management
-- Environmental Law
-- Financial Services Regulation Law
-- Insurance Law
-- Labor Law - Management
-- Land Use & Zoning Law
-- Litigation - Antitrust
-- Litigation - Bankruptcy
-- Litigation - Construction
-- Litigation - Environmental
-- Litigation - Intellectual Property
-- Litigation - Land Use & Zoning
-- Litigation - Real Estate
-- Litigation - Trusts & Estates
-- Mass Tort Litigation / Class Actions - Defendants
-- Medical Malpractice Law - Defendants
-- Personal Injury Litigation - Defendants
-- Product Liability Litigation - Defendants
-- Real Estate Law
-- Tax Law
-- Transportation Law
-- Trusts & Estates Law
-- Workers' Compensation Law - Employers
About Roetzel
Roetzel -- http://ralaw.com-- is a full-service law firm with
more than 200 attorneys in offices located throughout Ohio and
Florida and in Chicago, New York and Washington, D.C. The firm
provides comprehensive legal services to national and
international corporations, closely held and family-run
businesses, institutions, organizations and individuals.
* Lawrence Gonzalez II Joins Roetzel's Creditors' Rights Group
--------------------------------------------------------------
Roetzel on Nov. 5 announced that Lawrence Gonzalez II has joined
the firm's Orlando office as an associate attorney. Mr. Gonzalez
focuses his practice on commercial bankruptcy and creditors'
rights. He represents secured and unsecured creditors, including
lending institutions, purchasers of assets, landlords and trade
creditors, in bankruptcy cases and adversary proceedings.
Mr. Gonzalez earned his undergraduate degree from the University
of Florida and his J.D. from the University of Florida Levin
College of Law, where he received the school's Book Award for both
Mergers and Acquisitions and Medical Malpractice. He is licensed
to practice law in the state of Florida.
About Roetzel
Roetzel -- http://www.ralaw.com-- is a full-service law firm with
more than 200 attorneys in offices located throughout Ohio and
Florida and in Chicago, New York and Washington, D.C. The firm
provides comprehensive legal services to national and
international corporations, closely held and family-run
businesses, institutions, organizations and individuals.
* Recent Small-Dollar & Individual Chapter 11 Filings
-----------------------------------------------------
In re Rafael Palacios
Bankr. S.D. Cal. Case No. 13-10548
Chapter 11 Petition filed October 30, 2013
In re Charles Bowcock
Bankr. M.D. Fla. Case No. 13-06472
Chapter 11 Petition filed October 30, 2013
In re Metro Design Associates, Inc.
Bankr. N.D. Ill. Case No. 13-42412
Chapter 11 Petition filed October 30, 2013
See http://bankrupt.com/misc/ilnb13-42412.pdf
represented by: Dennise L. McCann, Esq.
ANDERSON & ASSOCIATES, P.C.
E-mail: mccann@aandalaw.com
In re Ping Panlilio Landscaping and Design, Inc.
Bankr. D.N.J. Case No. 13-33742
Chapter 11 Petition filed October 30, 2013
See http://bankrupt.com/misc/njb13-33742.pdf
represented by: Jennifer Opoku-Asare, Esq.
ASARE LAW FIRM, LLC
E-mail: jenasare@gmail.com
In re Red Hook Meat Corp.
aka Fine Fare Super Market
Gun Hill Rd. Meat Corp
Bankr. E.D.N.Y. Case No. 13-46540
Chapter 11 Petition filed October 30, 2013
See http://bankrupt.com/misc/nyeb13-46540.pdf
represented by: Neil R. Flaum, Esq.
FLAUM & ASSOCIATES, P.C.
E-mail: flaumandassociatespc@gmail.com
In re William Flores Sierra
Bankr. D.P.R. Case No. 13-08968
Chapter 11 Petition filed October 30, 2013
In re Casa Blanca Condominium Association, Inc.
Bankr. N.D. Tex. Case No. 13-35512
Chapter 11 Petition filed October 30, 2013
See http://bankrupt.com/misc/txnb13-35512.pdf
represented by: Joyce W. Lindauer, Esq.
JOYCE W. LINDAUER, ATTORNEY AT LAW
E-mail: courts@joycelindauer.com
In re OK Sod, Inc.
Bankr. N.D. Tex. Case No. 13-44904
Chapter 11 Petition filed October 30, 2013
See http://bankrupt.com/misc/txnb13-44904.pdf
represented by: Eric A. Liepins, Esq.
ERIC A. LIEPINS, P.C.
E-mail: eric@ealpc.com
In re Nicholas Bidic
Bankr. W.D. Tex. Case No. 13-31805
Chapter 11 Petition filed October 30, 2013
In re Micahel A. Duncan
Bankr. M.D. Ala. Case No. 13-12068
Chapter 11 Petition filed October 31, 2013
See http://bankrupt.com/misc/almb13-12068.pdf
represented by: Cameron A. Metcalf, Esq.
ESPY, METCALF & ESPY, P.C.
E-mail: cam@espymetcalf.com
In re Todd McMillon
Bankr. D. Ariz. Case No. 13-19082
Chapter 11 Petition filed October 31, 2013
In re Janice Bartmess
Bankr. C.D. Cal. Case No. 13-36476
Chapter 11 Petition filed October 31, 2013
In re Shuai Shuai Int'l Corp.
dba Arby's (store#284)
Bankr. C.D. Cal. Case No. 13-36526
Chapter 11 Petition filed October 31, 2013
See http://bankrupt.com/misc/cacb13-36526.pdf
represented by: Michael Y. Lo, Esq.
LAW OFFICE OF MICHAEL Y LO
E-mail: michaellolaw@yahoo.com
In re Laura Pezzi
Bankr. E.D. Cal. Case No. 13-33962
Chapter 11 Petition filed October 31, 2013
In re Yellow Wolf, Inc.
Bankr. M.D. Fla. Case No. 13-06534
Chapter 11 Petition filed October 31, 2013
See http://bankrupt.com/misc/flmb13-06534.pdf
represented by: J. Russell Collins, Esq.
RUSTY LAW, LLC
E-mail: rusty@rustylaw.com
In re David Ullman
Bankr. M.D. Fla. Case No. 13-14576
Chapter 11 Petition filed October 31, 2013
In re Gin Fol, LLC
Bankr. N.D. Ga. Case No. 13-23071
Chapter 11 Petition filed October 31, 2013
See http://bankrupt.com/misc/ganb13-23071.pdf
represented by: Charles N. Kelley, Jr., Esq.
CUMMINGS & KELLEY, P.C.
E-mail: ckelley@cummingskelley.com
In re Tracy Nunan
Bankr. E.D. Ky. Case No. 13-52659
Chapter 11 Petition filed October 31, 2013
In re Carla Blakey
Bankr. E.D. Mich. Case No. 13-60068
Chapter 11 Petition filed October 31, 2013
In re Dwight Blakey
Bankr. E.D. Mich. Case No. 13-60068
Chapter 11 Petition filed October 31, 2013
In re David Scholz
Bankr. S.D. Miss. Case No. 13-03295
Chapter 11 Petition filed October 31, 2013
In re Itamar Gessler
Bankr. D.N.J. Case No. 13-34015
Chapter 11 Petition filed October 31, 2013
In re Tonya Johnson
Bankr. S.D. Ohio Case No. 13-58653
Chapter 11 Petition filed October 31, 2013
In re Troy Johnson
Bankr. S.D. Ohio Case No. 13-58653
Chapter 11 Petition filed October 31, 2013
In re Integrated Building Systems, Inc.
Bankr. E.D. Pa. Case No. 13-19490
Chapter 11 Petition filed October 31, 2013
See http://bankrupt.com/misc/paeb13-19490.pdf
represented by: Douglas J. Smillie, Esq.
FITZPATRICK LENTZ AND BUBBA, P.C.
E-mail: dsmillie@flblaw.com
In re Herminio Gomez-Montalvo
Bankr. D.P.R. Case No. 13-09104
Chapter 11 Petition filed October 31, 2013
In re Amarillo Biosciences, Inc.
Bankr. N.D. Tex. Case No. 13-20393
Chapter 11 Petition filed October 31, 2013
See http://bankrupt.com/misc/txnb13-20393.pdf
represented by: Roger S. Cox, Esq.
UNDERWOOD LAW FIRM
E-mail: rici.mccoy@uwlaw.com
In re Heidi Stafford
Bankr. W.D. Wash. Case No. 13-19709
Chapter 11 Petition filed October 31, 2013
In re Thomas Blair
Bankr. S.D. W.Va. Case No. 13-20566
Chapter 11 Petition filed October 31, 2013
In re Oro Capital Group, Inc.
dba Quality Inn
Bankr. D. Ariz. Case No. 13-19116
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/azb13-19116.pdf
represented by: Eric Slocum Sparks, Esq.
ERIC SLOCUM SPARKS, P.C.
E-mail: law@ericslocumsparkspc.com
In re Roderick Careaga
Bankr. C.D. Cal. Case No. 13-12710
Chapter 11 Petition filed November 1, 2013
In re California Sunflower, LLC
Bankr. C.D. Cal. Case No. 13-28096
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/cacb13-28096.pdf
represented by: Stephen R. Wade, Esq.
THE LAW OFFICES OF STEPHEN R. WADE
E-mail: laurel@srwadelaw.com
In re Jeen Jimenez
Bankr. C.D. Cal. Case No. 13-36555
Chapter 11 Petition filed November 1, 2013
In re Steve Chapman
Bankr. M.D. Fla. Case No. 13-06555
Chapter 11 Petition filed November 1, 2013
In re NWGA Holmes, LLC
Bankr. N.D. Ga. Case No. 13-43175
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/ganb13-43175.pdf
represented by: Nancy A. Burnett, Esq.
NANCY A. BURNETT, P.C.
E-mail: nancyburnett@live.com
In re Leon Mealor
Bankr. S.D. Ga. Case No. 13-60608
Chapter 11 Petition filed November 1, 2013
In re Meridian Health Group, P.C.
Bankr. S.D. Ind. Case No. 13-11668
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/insb13-11668.pdf
represented by: Niccole R. Sadowski, Esq.
TUCKER HESTER BAKER & KREBS, LLC
E-mail: nsadowski@thbklaw.com
In re Account-Ability Accounting Services LLC
Bankr. W.D. Mich. Case No. 13-08544
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/miwb13-08544.pdf
Filed as Pro Se
In re Furniture Land East LLC
Bankr. D.N.J. Case No. 13-34190
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/njb13-34190.pdf
represented by: Thomas W. Williams, Esq.
LAW OFFICE OF THOMAS W. WILLIAMS
E-mail: krecio68@gmail.com
In re Morrell Caterers, Ltd.
Bankr. E.D.N.Y. Case No. 13-75586
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/nyeb13-75586.pdf
represented by: Gary C. Fischoff, Esq.
BERGER, FISCHOFF & SHUMER, LLP
E-mail: gfischoff@sfbblaw.com
In re Morrell Caterers of Lawrence, Ltd.
Bankr. E.D.N.Y. Case No. 13-75587
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/nyeb13-75587.pdf
represented by: Gary C. Fischoff, Esq.
BERGER, FISCHOFF & SHUMER, LLP
E-mail: gfischoff@sfbblaw.com
In re Gitomer Offices, LLC
fdba Gitomer Real Estate, LLC
Bankr. W.D.N.C. Case No. 13-32343
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/ncwb13-32343.pdf
represented by: R. Keith Johnson, Esq.
R. KEITH JOHNSON, P.A.
E-mail: rkjpa@bellsouth.net
In re Ronald Wobb
Bankr. W.D. Pa. Case No. 13-24653
Chapter 11 Petition filed November 1, 2013
In re Synthia Contestabile
Bankr. W.D. Pa. Case No. 13-24656
Chapter 11 Petition filed November 1, 2013
In re Jimmy Fuentes-Fonseca
Bankr. D.P.R. Case No. 13-09196
Chapter 11 Petition filed November 1, 2013
In re JB Development Corp.
aka JB Development Inc.
Bankr. D.P.R. Case No. 13-09200
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/prb13-09200.pdf
represented by: Antonio I. Hernandez Santiago, Esq.
ANTONIO I. HERNANDEZ SANTIAGO LAW OFFICE
E-mail: ahernandezlaw@yahoo.com
In re James Kirk
Bankr. W.D. Tenn. Case No. 13-31882
Chapter 11 Petition filed November 1, 2013
In re Rodriguez Hand Rehabilitation Center & Physical Therapy,
Inc.
Bankr. S.D. Tex. Case No. 13-10476
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/txsb13-10476.pdf
represented by: Eduardo V. Rodriguez, Esq.
MALAISE LAW FIRM
E-mail: igotnoticesbv@malaiselawfirm.com
In re Jorge Gamboa
Bankr. W.D. Tex. Case No. 13-52952
Chapter 11 Petition filed November 1, 2013
In re CLI Holdings, Inc. dba Alydian, Inc.
Bankr. W.D. Wash. Case No. 13-19746
Chapter 11 Petition filed November 1, 2013
See http://bankrupt.com/misc/wawb13-19746.pdf
represented by: Deirdre Glynn Levin, Esq.
KELLER ROHRBACK, LLP
E-mail: dglynnlevin@kellerrohrback.com
In re Evan Sachs
Bankr. C.D. Cal. Case No. 13-19049
Chapter 11 Petition filed November 2, 2013
In re Basia White
Bankr. C.D. Cal. Case No. 13-36614
Chapter 11 Petition filed November 2, 2013
In re Merle Heslop
Bankr. S.D. Fla. Case No. 13-36551
Chapter 11 Petition filed November 3, 2013
In re Karl-Henri Gauvin
Bankr. D. Md. Case No. 13-28660
Chapter 11 Petition filed November 3, 2013
In re Seward Avenue Properties, LLC
Bankr. S.D.N.Y. Case No. 13-13573
Chapter 11 Petition filed November 3, 2013
See http://bankrupt.com/misc/nysb13-13573.pdf
represented by: Rachel S. Blumenfeld, Esq.
LAW OFFICES OF RACHEL S. BLUMENFELD
E-mail: rblmnf@aol.com
In re Bellingrath Road Mini Storage, LLC
Bankr. S.D. Ala. Case No. 13-03896
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/alsb13-03896.pdf
represented by: Barry A. Friedman, Esq.
BARRY A. FRIEDMAN AND ASSOCIATES P.C.
E-mail: bky@bafmobile.com
In re Pryor Clinger Properties, LLC
Bankr. D. Ariz. Case No. 13-19202
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/azb13-19202.pdf
represented by: Allan D. Newdelman, Esq.
ALLAN D. NEWDELMAN, P.C.
E-mail: anewdelman@qwestoffice.net
In re Denco Sports Luggage, Inc.
Bankr. N.D. Cal. Case No. 13-32411
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/canb13-32411.pdf
represented by: Jackson A. Morris, III, Esq.
LAW OFFICES OF JACKSON A. MORRIS, III
E-mail: jacksonmorris@sbcglobal.net
In re Horizon Womens Care Professional, LLC
Bankr. D. Colo. Case No. 13-28436
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/cob13-28436.pdf
represented by: Jeffrey Weinman, Esq.
WEINMAN & ASSOCIATES, P.C.
E-mail: jweinman@epitrustee.com
In re Scott McNamara
Bankr. D. D.C. Case No. 13-00698
Chapter 11 Petition filed November 4, 2013
In re Jeremiah Jackson
Bankr. M.D. Fla. Case No. 13-6581
Chapter 11 Petition filed November 4, 2013
In re William Hunter
Bankr. M.D. Ga. Case No. 13-11581
Chapter 11 Petition filed November 4, 2013
In re Frances Hunter
Bankr. M.D. Ga. Case No. 13-11582
Chapter 11 Petition filed November 4, 2013
In re Cathryn Pittman
Bankr. N.D. Ga. Case No. 13-23106
Chapter 11 Petition filed November 4, 2013
In re Quint G, Inc.
Bankr. N.D. Ill. Case No. 13-43163
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/ilnb13-43163.pdf
represented by: John S. Biallas, Esq.
JOHN S. BIALLAS, ATTORNEY AT LAW
E-mail: jsb70@comcast.net
In re Network Product Leasing, Inc.
Bankr. W.D. La. Case No. 13-51318
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/lawb13-51318.pdf
represented by: William C. Vidrine, Esq.
VIDRINE & VIDRINE
E-mail: williamv@vidrinelaw.com
In re Sam's Joint, Inc.
dba Sam's
Sam's Joint
Max & Co.
fdba Max's
Spyke's
Bankr. W.D. Mich. Case No. 13-08566
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/alsb13-03896.pd
represented by: Steven L. Rayman, Esq.
RAYMAN & KNIGHT
E-mail: courtmail@raymanstone.com
In re S.B. Realty, Inc.
Bankr. W.D. Mich. Case No. 13-08567
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/miwb13-08567.pd
represented by: Steven L. Rayman, Esq.
RAYMAN & KNIGHT
E-mail: courtmail@raymanstone.com
In re Emmett Sanford
Bankr. N.D. Miss. Case No. 13-14663
Chapter 11 Petition filed November 4, 2013
In re Dominick Santiago
Bankr. D.N.J. Case No. 13-34251
Chapter 11 Petition filed November 4, 2013
In re ITCNYC, LLC
Bankr. E.D.N.Y. Case No. 13-46663
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/nyeb13-46663.pdf
represented by: Dennis Houdek, Esq.
E-mail: denniswhoudek@aol.com
In re Augustin Pierre-Louis
Bankr. E.D.N.Y. Case No. 13-46669
Chapter 11 Petition filed November 4, 2013
In re Metropolitan Escort Service, Inc.
Bankr. S.D.N.Y. Case No. 13-13630
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/nysb13-13630.pdf
represented by: Lindsay Zahradka, Esq.
AKIN GUMP STRAUSS HAUER & FELD, LLP
E-mail: lzahradka@akingump.com
In re Midway Leasing, Inc.
Bankr. S.D.N.Y. Case No. 13-13631
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/nysb13-13631.pdf
represented by: Lindsay Zahradka, Esq.
AKIN GUMP STRAUSS HAUER & FELD, LLP
E-mail: lzahradka@akingump.com
In re Carolina Sleep Shoppe, LLC
dba America's Mattress
Bankr. W.D.N.C. Case No. 13-32346
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/ncwb13-32346.pdf
represented by: Richard S. Wright, Esq.
MOON WRIGHT & HOUSTON, PLLC
E-mail: rwright@mwhattorneys.com
In re Longview Assisted Living, LLC
Bankr. W.D.N.C. Case No. 13-40588
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/ncwb13-40588.pdf
represented by: Glenn C. Thompson, Esq.
HAMILTON STEPHENS STEELE & MARTIN
E-mail: gthompson@lawhssm.com
In re Daniel Kasnett
Bankr. N.D. Ohio Case No. 13-17786
Chapter 11 Petition filed November 4, 2013
In re Michael Anderson
Bankr. D. S.C. Case No. 13-06581
Chapter 11 Petition filed November 4, 2013
In re Home Realty Company Of Memphis, Inc.
Bankr. W.D. Tenn. Case No. 13-31959
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/tnwb13-31959.pdf
represented by: Russell W. Savory, Esq.
GOTTEN, WILSON, SAVORY & BEARD, PLLC
E-mail: russell.savory@gwsblaw.com
In re 5400 Pinemont Plaza Inc.
Bankr. S.D. Tex. Case No. 13-36815
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/txsb13-36815.pdf
represented by: Afton Jane Izen, Esq.
E-mail: aftonizen@hotmail.com
In re Simbaki, Ltd.
dba Berryhill Baja Grill
Berryhill Baja Grill & Cantina
Bankr. S.D. Tex. Case No. 13-36878
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/txsb13-36878.pdf
represented by: Calvin C. Braun, Esq.
ORLANDO & BRAUN, LLP
E-mail: calvinbraun@orlandobraun.com
In re CMS Primary Home Care, Inc.
Bankr. S.D. Tex. Case No. 13-70582
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/txsb13-70582.pdf
represented by: Ellen C. Stone, Esq.
THE STONE LAW FIRM, P.C.
E-mail: ignmca@ellenstonelaw.com
In re Heroes Ventures, L.L.C.
Bankr. S.D. Tex. Case No. 13-70587
Chapter 11 Petition filed November 4, 2013
See http://bankrupt.com/misc/txsb13-70587.pdf
represented by: Juan M Pequeno, Jr., Esq.
JONES, GALLIGAN, KEY & LOZANO, L.L.P.
E-mail: jpequeno@jgkl.com;ldallas@jgkl.com
In re Jeffrey Krantz
Bankr. W.D. Tex. Case No. 13-31847
Chapter 11 Petition filed November 4, 2013
In re Laura Miramontez
Bankr. W.D. Tex. Case No. 13-31855
Chapter 11 Petition filed November 4, 2013
*********
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, Valerie Udtuhan, 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.
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are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000 or Nina Novak at 202-241-8200.
*** End of Transmission ***