/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/140211.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, February 11, 2014, Vol. 18, No. 41 Headlines 1250 OCEANSIDE: Hearing on Third Amended Plan Begins April 2 1250 OCEANSIDE: Sun Kona Wants Claim Estimated as $627 Million 261 EAST: 2nd Amended Reorganization Plan Confirmed 4KIDS ENTERTAINMENT: Challenge to Cornerstone Claim Pending 4KIDS ENTERTAINMENT: Kahn Discloses 9% Stake in Licensing Shares 710 LONG RIDGE: NLRB Appeals from CBA Rejection Order AEROFLEX INC: Moody's Affirms 'B1' CFR & Sr. Secured Rating AGFEED INDUSTRIES: Asks Court to Extend Removal Period AGFEED INDUSTRIES: Plan Exclusivity Period Extended Thru March 4 AGFEED INDUSTRIES: Hires Plante & Moran as Tax Services Provider ALLENS INC: Bain, Gordon Brothers Venture to Pay $160MM for Co. ALTREC INC: Auction on Assets Scheduled for Feb. 20 ALVARION(R) LTD: Appeals NASDAQ Delisting of Shares AMERICAN AIRLINES: Workers Claim Unions Withheld Equity AMERICAN PETROLEUM: Moody's Withdraws B2 CFR & Senior Sec. Rating AMG CAPITAL: Fitch Rates Trust Preferred Securities 'BB' APEX TOOLS: Moody's Cuts Corp. Family Rating to 'B3', Outlook Neg. ARCAPITA BANK: Court Confirms 2nd Amended Plan as to Falcon Gas ARCHDIOCESE OF MILWAUKEE: Committee Won't Oppose Quarles Fee Hike ARCHDIOCESE OF MILWAUKEE: Opposes OneBeacon Bid for Lift Stay ARMORWORKS ENTERPRISES: Plan Confirmation Hearing Moved to March 4 ARXX CORP: U.S. Court OKs Stalking Horse Deal w/ Airlite Plastics AURORA USA: Moody's Places 'B3' CFR for Possible Upgrade BEHAVIORAL HEALTH: Files for Ch. 7; Creditors Meeting Feb. 26 BIOSCRIP INC: S&P Affirms 'B' CCR & Revises Outlook to Negative BISHOP OF STOCKTON: Amends List of Top Unsecured Creditors BISHOP OF STOCKTON: Judge Zive Appointed as Mediator BISHOP OF STOCKTON: Felderstein Firm to Comply With UST Guidelines BISHOP OF STOCKTON: Proposes Neumiller as Special Counsel C&K MARKET: Files Ch. 11 Plan, Offers Stock to Creditors CENGAGE LEARNING: Revises Plan to Incorporate Global Settlement CENTRAL COVENTRY FIRE DISTRICT: Final Decision on Future Soon CHARTER COMMS: To Nominate Full Slate for Time Warner Cable Board CHESAPEAKE ENERGY: S&P Revises Outlook to Pos. & Affirms 'BB-' CCR CHINA NATURAL GAS: Honest Best, Yong Hui Li Disclose Stake CHINA NATURAL: Hearing on Plan Filing Extension Set for Feb. 25 COLLEGE WAY: Court Approves Hiring of Iwama Law as Counsel COMMONWEALTH EDISON: Fitch Hikes Preferred Stock Rating From 'BB+' COMMUNITY HOME: Chapter 11 Trustee Hires Jones Walker as Counsel COMMUNITY HOME: Ch.11 Trustee's "Disinterestedness" Questioned CONSTAR INT'L: Gets Court OK to Hire Prime Clerk as Admin. Advisor CONSTAR INT'L: Can Hire Young Conaway as Attorneys CONSTAR INT'L: Court Approves Dechert LLP as Attorneys CONSTAR INT'L: May Hire Lincoln Partners as Financial Advisor COTTONWOOD ESTATES: Wants to Hire Miller Guymon as Counsel CUE & LOPEZ: Wants Plan Exclusivity Period Extended Until April 1 DEALERTRACK TECHNOLOGIES: S&P Assigns Preliminary 'B+' CCR DELUXE ENTERTAINMENT: Moody's Rates New $570MM Secured Loan 'B2' DETROIT, MI: DIA Pledges to Raise $100M for Art, Pension Fund DETROIT, MI: Seek to Vacate Appointment of Creditor's Panel DEVER ELEMENTARY SCHOOL: Headed for Receivership DIOCESE OF GALLUP: Creditors Want Adequate Measures DIOCESE OF GALLUP: Pachulski Compensation Criticized DIOCESE OF GALLUP: St. Bonaventure Indian Mission Sues Diocese DIOCESE OF HELENA: Files for Chapter 11 Due to Abuse Claims DIOCESE OF HELENA: Case Summary & Top Unsecured Creditors DIOCESE OF HELENA: Judge Myers to Oversee Chapter 11 Case DOTS LLC: Hires A&G Realty as Real Estate Consultants DRYSHIPS INC: Ocean Rig Enters Into Amendment of $1.9BB Term Loan DVORKIN HOLDINGS: Ch. 11 Trustee Hires North Clybourn as Broker EMPIRE DIE: Creditors' Panel Can Hire Freeborn & Peters as Counsel EXIDE TECHNOLOGIES: Posts $34MM Net Loss for Fiscal Q3 F&H ACQUISITION: Feb. 28 Hearing on Global Compromise FIBERTECH NETWORKS: S&P Affirms B+ CCR & B+ Rating on $51MM Debt FIRST CHURCH OF CHRIST: Foreclosure Sale on March 14 FREEDOM INDUSTRIES: Faces "Vantap" Suit Over January 2014 Spill GENERAL MOTORS: Steps Up Pickup-Truck Discounts After Weak January GREEN FIELD: Court OKs Key Employee Incentive & Retention Plans GREEN MOUNTAIN: S&P Puts 'BB-' CCR on CreditWatch Positive GROUP UNITED: Panama Canal Expansion Suspended GSP GROUP: PE Firm Revives 'Mafia' Defamation Claims in Sale Row HARRISBURG, PA: Receivership Could be Over by Spring, Mayor Says HDOS ENTERPRISES: Can Use Cash Collateral Until March 20 HDOS ENTERPRISES: Sec. 341(a) Meeting of Creditors Set for March 7 HDOS ENTERPRISES: Has Interim Authority to Pay Critical Vendors HDOS ENTERPRISES: Seeks to Reject Leases for 16 Stores HEENAN BLAIKIE: Closes, Lawyers Seek New Homes HOSPITALITY STAFFING: Feb. 24 Hearing on Severance Benefits HOSPITALITY STAFFING: Wants to Change Case Caption Following Sale JAMES RIVER: Mulls Sale, Other Alternatives KINDE DURKEE: Liquidators Recover Only $94,000 From Theft KIT DIGITAL: Files Suit Against Invigor Over Asset Acquisition LABORATORY PARTNERS: Wants More Time to Decide on Leases LADDER CAPITAL: Fitch Says IPO Neutral to Company's 'BB' IDR LAND RESOURCE: 6th Circuit Says Condo Owner Can't Sue Insurers LIBERTY MEDICAL: Court Rejects Relators' Reverse False Claim LIBERTY MEDICAL: Hires EYCA as Financial Advisor LIQUIDATION WORLD: Closes 73 Stores in Canada LONGVIEW POWER: Exclusive Plan Filing Deadline Moved to March 14 LONGVIEW POWER: Kvaerner Wants Relief From Automatic Stay LOUISIANA RIVERBOAT: May Use Cash Collateral Through March 31 MERITAGE HOMES: Moody's Hikes Corp. Family Rating to 'Ba3' MESA AIR: KSAZ News 10 Story Misrepresents Pilots, ALPA Says MF GLOBAL: Knighthead Questions Liquidation Fees MICHAEL GERARD: $281,000 Judgment Non-Dischargeable MONTANA ELECTRIC: Court OKs Hiring of McGuireWoods as Co-Counsel MORNINGSTAR MARKETPLACE: Wants Schedules Filing Moved to March 17 MORNINGSTAR MARKETPLACE: Proposes Smigel Anderson as Counsel MSI CORPORATION: Wants Until June 2 to File Chapter 11 Plan MW GROUP: BofA to File Amended Plan & Disclosure Statement NATIONAL ENVELOPE: Plan Filing Period Extended to April 7 NATURAL MOLECULAR: Wants to File Chapter 11 Plan Until May 30 NATURAL PORK: Files Joint Liquidation Plan NMP-GROUP: Plan Declared Effected in October Last Year OLEO E GAS: Gets $215 Million Investment ORLANDO CITY, FL: S&P Affirms 'CC' Bond Rating, Outlook Stable OSHKOSH CORP: S&P Rates $250MM Sr. Unsecured Notes 'BB+' PAYPAL INC: Buyout Firms Gear Up for a Swipe at Firm PRM FAMILY: Court Okays Private Sale of Assets RENT-A-CENTER: Hoping To Pay A Dividend, Will Refinance RESIDENTIAL CAPITAL: Judge Approves $2 Million Bonus for Chief REVOLUTION DAIRY: Court Issues Confirmation Order REXNORD LLC: S&P Raises Corp. Credit Rating to BB-, Outlook Stable SHELBOURNE NORTH: Seeks Court Nod on Plan Investment Agreement SHELBOURNE NORTH: Developer Finds Investor to Restart Project SHOTWELL LANDFILL: Files Schedules of Assets and Liabilities SHUANEY IRREVOCABLE: Denies US Trustee's Bid for Ch. 7 Conversion SOUND SHORE: Ford Credit Seeks Relief From Automatic Stay SOUNDVIEW ELITE: Jones Day's Corinne Ball Named Ch.11 Trustee SOUNDVIEW ELITE: Law Clerk Recuses From Bankruptcy Matters SOUTH FLORIDA SOD: GSS Seeks Rule 2004 Examination SPECTRASCIENCE INC: HJ Assoc. Replaces McGladrey as Accountant STANS ENERGY: Provides Update on Management Cease Trade Order STERLING BLUFF: Coastal Bank Wants Ch. 11 Case Dismissed STERLING BLUFF: Sec. 341(a) Meeting of Creditors Set for March 3 SWA BASELINE: Mesa, Arizona Business Campus Owner in Chapter 11 TAMERLANE VENTURES: Global Resource Seeks CCAA Termination TC GLOBAL: Unit's Suit v. AFCM in Seattle Goes to Trial TERENCE QUINN O'NEIL: Assets to Be Auctioned Off Feb. 25 THERMO FISHER: FTC Goes Global in Antitrust Review TIMBERLINE RESOURCES: Gets NYSE MKT Listing Non-Compliance Notice TLC HEALTH: Court Okays Menter Rudin as Bankruptcy Counsel TRANSTAR HOLDING: ETX Acquisition No Impact on Moody's B2 Rating TRINITY COAL: Court Okays Deal with Caterpillar Financial VIVA ALAMO: S&P Assigns Prelim. 'BB-' Rating on $500MM Sec. Loan WORLD IMPORTS: Can Access Bank's Cash Collateral Until Feb. 28 * Bid to Speed 'Proxy Plumbing' Riles Activist Investors * For-Profit Colleges Face New Wave of State Investigations * Fitch: SNAP Cuts in Farm Bill May Dent Food Companies * ADGS Appoints Ho Sai Kwan David as Legal Advisor * Large Companies With Insolvent Balance Sheet ********* 1250 OCEANSIDE: Hearing on Third Amended Plan Begins April 2 ------------------------------------------------------------ The Hon. Robert J. Faris of the U.S. Bankruptcy Court for the District of Hawaii will convene a hearing commencing April 2, 2014, at 9:30 a.m., to consider the confirmation of the Third Amended Plan of Reorganization proposed by 1250 Oceanside Partners, et al., and Sun Kona Finance I, LLC. The Court signed on Jan. 28, 2014, the order approving the Disclosure Statement explaining the Joint Consolidated Plan dated Nov. 22, 2013. The order also approved these deadlines in relation to the Plan: Feb. 19: Deadline for Plan Proponents to file their opening confirmation brief together will all additional export reports and all other direct testimony of intended witnesses; March 12: (i) last day for objecting creditors to provide their opposing confirmation briefs, and to file export reports together with all other direct testimony of intended witness; and (ii) last day for objecting parties to depose witnesses identified by Plan Proponents as of Feb. 19; March 26: (i) last day for Plan proponents to depose witnesses identified by objecting parties; (ii) last day for Plan Proponents to file and serve their reply brief. Plan votes are due 4:00 p.m. on the day that is 14 days before the confirmation hearing date. Third Amended Plan As reported in the Troubled Company Reporter on Dec. 16, 2013, the Third Amended Plan was filed in light of a lawsuit filed by William Batiste in October. On Oct. 10, 2013, William Batiste and certain other lot owners commenced an adversary proceeding entitled William Batiste, et al., vs. Sun Kona Finance I, LLC, Adv. Proc. No. 13-90068, in the Bankruptcy Court. The suit alleges that Bank of Scotland, SKFI (which acquired the Bank of Scotland loan), and other entities engaged in negligent and willful and wrongful acts that caused harm to lot owners. SKFI does not believe that the claims asserted against SKFI have any merit and intend to vigorously oppose the claims in the lawsuit. To prevent a delay in confirmation due to the litigation, the plan proponents say the Third Amended Plan provides for the appropriate treatment of the Class 9 Allowed Oceanside General Unsecured Claims in the event that the Court in the future enters a judgment determining that the SKFI claim should be subordinated in whole or in part (Count I of the Batiste Action), or that the SKFI claim should be reclassified as equity in whole or in part (Count II of the Batiste Action). The plan proponents intend to request that the issues raised by Count III (which seeks to disallow SKFI's claims due to SKFI's failure to adequately support its claims and on other grounds) be resolved by the Court as part of the confirmation process, without prejudice to the Court's resolution of Counts I and II at a later date. The amendments, according to the plan proponents, should allow the confirmation of the Plan in a timely manner, the payment of other allowed claims, and the continued development of the Hokuli'a Project in the best interest of all parties. The Plan provides that the additional capital necessary to emerge from Chapter 11 will be provided by the exit loan from SKFI which will provide the Debtors with a line of credit of up to $65,000,000. Based on the Debtors' projections, the exit loan will allow the Debtor to pay its outstanding administrative claims and cure claims upon emergence, pay all other restructured debts as they become due, and will provide adequate working capital for the Debtors going forward. Because resolution of the Batiste Action may impact the treatment of Class 9 claims, it is anticipated that no distributions will be made on Class 9 Claims until the Batiste Action is resolved. A copy of the Disclosure Statement dated Nov. 22, 2013, is available for free at: http://bankrupt.com/misc/1250_Sun_Kona_DS_112213.pdf About 1250 Oceanside Partners 1250 Oceanside Partners, Front Nine, LLC, and Pacific Star Company, LLC, owners of the 1,800-acre Hokuli'a luxury real estate development near Kona on the island of Hawaii, sought Chapter 11 protection (Bankr. D. Hawaii Lead Case No. 13-00353) on March 6, 2013, in Honolulu. The Debtors were formed by developer Lyle Anderson and were part of his development "empire", which included developments in Hawaii, Arizona, New Mexico and Scotland. The secured lender, Bank of Scotland, declared a default and obtained control of the Debtors in January 2008. Development of the property, which has 3.5 miles of waterfront on the Kona coast, stopped after the developers were declared in default under the loan. Oceanside and Front Nine own most of the land within the Hokuli'a project, which is the principal development. Pacific Star owns the land referred to as "Keopuka", near Hokuli'a. The Hokuli'a was to have 730 residential units, an 18-hole golf course, club and other amenities. The Debtors say their assets are worth $68.1 million while they are jointly liable to $625 million of debt to Sun Kona Finance LLC, which acquired the Hawaii loan from Bank of Scotland. Simon Klevansky, Esq., Alika L. Piper, Esq., and Nicole D. Stucki, Esq., at Klevansky Piper, LLP, represent the Debtor in its restructuring effort. They replaced the law firm of Gelber, Gelber & Ingersoll as general counsel. 1250 Oceanside Partners, its affiliates and lender Sun Kona Finance I LLC, won court approval of the disclosure statement explaining a reorganization plan that would turn over ownership to its secured lender. Sun Kona would provide a $65 million exit facility to help make payments under the plan and to fund the reorganized company when it leaves court protection. A creditors committee has not been appointed. James A. Wagner, Esq., and Allison A. Ito, Esq., at Wagner Choi & Verbrugge, represent creditor Sun Kona Finance I, LLC, as counsel. 1250 OCEANSIDE: Sun Kona Wants Claim Estimated as $627 Million -------------------------------------------------------------- Allisson A. Ito, Esq., at Wagner Choi & Verbrugge, on behalf of Sun Kona Finance I LLC, asks the U.S. Bankruptcy Court for the District of Hawaii to estimate proof of claim No. 60 at $627,166,062, solely with respect to confirmation of 1250 Oceanside Partners, et al.'s plan of reorganization. SKFI also requests that Court determine that the SKFI claim is secured by all of the Oceanside's real and personal property, except the excluded assets. SKFI filed a proof of claim asserting a secured claim of $627,166,062. SKFI filed similar claims against Front Nine, LLC, and Pacific Star Company, LLC, as co-borrower with Oceanside. About 1250 Oceanside Partners 1250 Oceanside Partners, Front Nine, LLC, and Pacific Star Company, LLC, owners of the 1,800-acre Hokuli'a luxury real estate development near Kona on the island of Hawaii, sought Chapter 11 protection (Bankr. D. Hawaii Lead Case No. 13-00353) on March 6, 2013, in Honolulu. The Debtors were formed by developer Lyle Anderson and were part of his development "empire", which included developments in Hawaii, Arizona, New Mexico and Scotland. The secured lender, Bank of Scotland, declared a default and obtained control of the Debtors in January 2008. Development of the property, which has 3.5 miles of waterfront on the Kona coast, stopped after the developers were declared in default under the loan. Oceanside and Front Nine own most of the land within the Hokuli'a project, which is the principal development. Pacific Star owns the land referred to as "Keopuka", near Hokuli'a. The Hokuli'a was to have 730 residential units, an 18-hole golf course, club and other amenities. The Debtors say their assets are worth $68.1 million while they are jointly liable to $625 million of debt to Sun Kona Finance LLC, which acquired the Hawaii loan from Bank of Scotland. Simon Klevansky, Esq., Alika L. Piper, Esq., and Nicole D. Stucki, Esq., at Klevansky Piper, LLP, represent the Debtor in its restructuring effort. They replaced the law firm of Gelber, Gelber & Ingersoll as general counsel. 1250 Oceanside Partners, its affiliates and lender Sun Kona Finance I LLC, won court approval of the disclosure statement explaining a reorganization plan that would turn over ownership to its secured lender. Sun Kona would provide a $65 million exit facility to help make payments under the plan and to fund the reorganized company when it leaves court protection. A creditors committee has not been appointed. James A. Wagner, Esq., and Allison A. Ito, Esq., at Wagner Choi & Verbrugge, represent creditor Sun Kona Finance I, LLC, as counsel. 261 EAST: 2nd Amended Reorganization Plan Confirmed --------------------------------------------------- Judge Robert E. Gerber of the U.S. Bankruptcy Court for the Southern District of New York on Jan. 29, 2014, issued an order confirming 261 East 78 Realty Corporation's Second Amended Chapter 11 Plan of Reorganization after determining that the Plan complies with the confirmation requirements laid out in the Bankruptcy Court. The Debtor filed a voting report, which reflected that Class 2 (MB Secured Claim), Class 3 (Hermes Secured Claim) and Class 4 (General Unsecured Claims) have each voted to accept the Plan. Class 1 (Other Priority Claims) is unimpaired under the Plan, not entitled to vote and are deemed to accept the Plan. Class 5 (Equity Interests) will not receive any distribution under the Plan on account of Interests in the Debtor and is deemed to have rejected the Plan. The Plan confirmation is subject to the terms and conditions of the settlement agreement with Hermes Capital, LLC. Under the terms of the Hermes settlement agreement, (a) DelBello Donnellan Weingarten Wise & Wiederkehr, LLP, is authorized and directed to pay to Hermes the sum of $200,000, and (b) Perkins Coie LLP is authorized and directed to pay to Hermes the sum of $1,125,000, which sums said firms are holding in escrow pursuant to the terms of the Plan and the Hermes Settlement Agreement. About 261 East 261 East 78 Realty Corp. owns real property located at 261 East 78th Street, in New York. The premises consist of seven commercial units, three of which are currently occupied. 261 East 78 Realty filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 11-15624) on Dec. 6, 2011. The case was assigned to Judge Robert E. Gerber. The Chapter 11 filing was precipitated by the commencement of foreclosure proceedings on the premises. The Debtor scheduled $20.2 million in assets and $18.8 million in liabilities. The petition was signed by Lee Moncho, president. Jonathan S. Pasternak, Esq., at DelBello Donnellan Weingarten Wise & Wiederkehr, LLP, in White Plains, N.Y., represents the Debtor as counsel. Matthew W. Olsen, Esq., at Katten Muchin Rosenman LLP, in New York, N.Y., represents MB Financial Bank, N.A., as counsel. Pursuant to the Plan Term Sheet, the Plan will be funded by amounts made available by (i) the Plan Funder, of which $1,500,000 will be deposited in the Plan Fund Account and $10,700,000 will be distributed to MB Financial Bank, N.A., on account of its Allowed Class 2 Claim or (ii) the net proceeds of a Public Sale of the Debtor's Property conducted pursuant to the Plan, of which $11,000,000 will be distributed to MB on account of its Allowed Class 2 Claim and the balance will be used to make payments due under the Plan. 4KIDS ENTERTAINMENT: Challenge to Cornerstone Claim Pending ----------------------------------------------------------- 4Licensing Corporation, formerly 4Kids Entertainment, Inc., and its Affiliated Reorganized Debtors filed a status report with the Bankruptcy Court last month, disclosing that: -- The Debtors have continued to make distributions to holders of allowed claims. As of Jan. 13, 2014 the distributions have totaled $4,113,394.76, including interest; -- On Oct. 1, 2013, the Court entered an order disallowing and expunging two claims and allowing, in part, two claims of Bryan Gannon and Goode Hemme & Peterson, APC; and -- As of Jan. 13, only one disputed claim remains outstanding -- $2.6 million in royalty underpayments alleged by Cornerstone Patent Technologies, LLC. The Debtors have filed an objection to the claim. About 4Kids Entertainment New York-based 4Kids Entertainment, Inc., dba 4Kids, was an entertainment and media company specializing in the youth oriented market, with operations in these business segments: (i) licensing, (ii) advertising and media broadcast, and (iii) television and film production/distribution. The parent entity, 4Kids Entertainment, was organized as a New York corporation in 1970. 4Kids Entertainment, Inc., filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code to protect its most valuable asset -- its rights under an exclusive license relating to the popular Yu-Gi-Oh! series of animated television programs -- from efforts by the licensor, a consortium of Japanese companies, to terminate the license and force 4Kids out of business. 4Kids and affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 11-11607) on April 6, 2011. The affiliates are 4Kids Ad Sales, Inc.; 4Kids Digital Games, Inc.; 4Kids Entertainment Home Video, Inc.; 4Kids Entertainment Music, Inc.; 4Kids Entertainment Licensing, Inc.; 4Kids Productions, Inc.; 4Kids Technology, Inc.; 4Kids Websites, Inc.; 4Sight Licensing Solutions, Inc.; The Summit Media Group, Inc.; and World Martial Arts Productions, Inc. Kaye Scholer LLP's D. Tyler Nurnberg, Esq., Seth J. Kleinman, Esq., and Matthew J. Micheli, Esq., serve as the Debtors' restructuring counsel. Epiq Bankruptcy Solutions, LLC, serves as the Debtors' claims and notice agent. BDO Capital Advisors, LLC, is the financial advisor and investment banker. EisnerAmper LLP fka Eisner LLP serves as auditor and tax advisor. 4Kids Entertainment disclosed $78,397,971 in assets and $86,515,395 in liabilities as of the Chapter 11 filing. Hahn & Hessen LLP serves as counsel to the Official Committee of Unsecured Creditors. Epiq Bankruptcy Solutions LLC serves as its information agent for the Committee. The Consortium consists of TV Tokyo Corporation, which owns and operates a television station in Japan; ASATSU-DK Inc., a Japanese advertising company; and Nihon Ad Systems, ADK's wholly owned subsidiary. The Consortium is represented by Kyle C. Bisceglie, Esq., Michael S. Fox, Esq., Ellen V. Holloman, Esq., and Mason Barney, Esq., at Olshan Grundman Frome Rosenzweig & Wolosky LLP, in New York. In January 2012, the bankruptcy judge ruled in favor of 4Kids, deciding that the Yu-Gi-Oh! property license agreement between the Debtor and the licensor was not effectively terminated prior to the bankruptcy filing. Following the ruling, 4Kids entered into a settlement where it would receive $8 million to end the dispute over its valuable Yu-Gi-Oh! Property. The Debtors' Amended Joint Plan of Reorganization dated Oct. 29, 2012, was confirmed by Judge Shelley C. Chapman in an order dated Dec. 13, 2012. The Plan went effective on Dec. 21, 2012. 4Kids was renamed 4Licensing Corporation and resumed trading on the OTC Pink Sheets in February 2013. All creditors recouped 100% of allowed claims under the Plan. Shareholders also received a distribution, projected to be 69 cents a share, according to the disclosure statement. The Debtor's business fetched a $15 million purchase price from two buyers. An affiliate of Tokyo-based Konami Corp. bought licenses for the Yu-Gi-Oh! animated television programs. Kidsco Media Venture LLC, affiliated with Saban Capital Group Inc., acquired the programming agreement with the CW Network LLC. 4Kids previously generated $9 million from settlement with the owner of the licenses for Yu-Gi-Oh!. 4KIDS ENTERTAINMENT: Kahn Discloses 9% Stake in Licensing Shares ---------------------------------------------------------------- Alfred Kahn disclosed in a Schedule 13G filing with the Securities and Exchange Commission that as of Jan. 30, 2014, he is the beneficial owner of 1,332,663 shares -- or 9.7% -- of 4Licensing Corporation Common Stock, $0.01 par value per share. This is based on 13,714,992 shares of common stock outstanding as of Nov. 14, 2013. About 4Kids Entertainment New York-based 4Kids Entertainment, Inc., dba 4Kids, was an entertainment and media company specializing in the youth oriented market, with operations in these business segments: (i) licensing, (ii) advertising and media broadcast, and (iii) television and film production/distribution. The parent entity, 4Kids Entertainment, was organized as a New York corporation in 1970. 4Kids Entertainment, Inc., filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code to protect its most valuable asset -- its rights under an exclusive license relating to the popular Yu-Gi-Oh! series of animated television programs -- from efforts by the licensor, a consortium of Japanese companies, to terminate the license and force 4Kids out of business. 4Kids and affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 11-11607) on April 6, 2011. The affiliates are 4Kids Ad Sales, Inc.; 4Kids Digital Games, Inc.; 4Kids Entertainment Home Video, Inc.; 4Kids Entertainment Music, Inc.; 4Kids Entertainment Licensing, Inc.; 4Kids Productions, Inc.; 4Kids Technology, Inc.; 4Kids Websites, Inc.; 4Sight Licensing Solutions, Inc.; The Summit Media Group, Inc.; and World Martial Arts Productions, Inc. Kaye Scholer LLP's D. Tyler Nurnberg, Esq., Seth J. Kleinman, Esq., and Matthew J. Micheli, Esq., serve as the Debtors' restructuring counsel. Epiq Bankruptcy Solutions, LLC, serves as the Debtors' claims and notice agent. BDO Capital Advisors, LLC, is the financial advisor and investment banker. EisnerAmper LLP fka Eisner LLP serves as auditor and tax advisor. 4Kids Entertainment disclosed $78,397,971 in assets and $86,515,395 in liabilities as of the Chapter 11 filing. Hahn & Hessen LLP serves as counsel to the Official Committee of Unsecured Creditors. Epiq Bankruptcy Solutions LLC serves as its information agent for the Committee. The Consortium consists of TV Tokyo Corporation, which owns and operates a television station in Japan; ASATSU-DK Inc., a Japanese advertising company; and Nihon Ad Systems, ADK's wholly owned subsidiary. The Consortium is represented by Kyle C. Bisceglie, Esq., Michael S. Fox, Esq., Ellen V. Holloman, Esq., and Mason Barney, Esq., at Olshan Grundman Frome Rosenzweig & Wolosky LLP, in New York. In January 2012, the bankruptcy judge ruled in favor of 4Kids, deciding that the Yu-Gi-Oh! property license agreement between the Debtor and the licensor was not effectively terminated prior to the bankruptcy filing. Following the ruling, 4Kids entered into a settlement where it would receive $8 million to end the dispute over its valuable Yu-Gi-Oh! Property. The Debtors' Amended Joint Plan of Reorganization dated Oct. 29, 2012, was confirmed by Judge Shelley C. Chapman in an order dated Dec. 13, 2012. The Plan went effective on Dec. 21, 2012. 4Kids was renamed 4Licensing Corporation and resumed trading on the OTC Pink Sheets in February 2013. All creditors recouped 100% of allowed claims under the Plan. Shareholders also received a distribution, projected to be 69 cents a share, according to the disclosure statement. The Debtor's business fetched a $15 million purchase price from two buyers. An affiliate of Tokyo-based Konami Corp. bought licenses for the Yu-Gi-Oh! animated television programs. Kidsco Media Venture LLC, affiliated with Saban Capital Group Inc., acquired the programming agreement with the CW Network LLC. 4Kids previously generated $9 million from settlement with the owner of the licenses for Yu-Gi-Oh!. 710 LONG RIDGE: NLRB Appeals from CBA Rejection Order ----------------------------------------------------- The National Labor Relations Board appeals from the opinion and order of the U.S. Bankruptcy Court for the District of New Jersey permitting 710 Long Ridge Road Operating Company II, LLC, et al., to reject their expired collective bargaining agreements under Section 1113(c) of the Bankruptcy Code. The NLRB also asked the Bankruptcy Court to stay the Section 1113(c) Order pending its appeal, which the Court denied on the same day. The NLRB then raised its motion for stay of the Section 1113(c) Order to the U.S. District Court for the District of New Jersey. As previously reported by The Troubled Company Reporter, the Bankruptcy Court authorized the Debtors to reject the continuing economic terms of the expired CBAs with New England Health Care Employees Union, District 1199, SEIU (Union); and implement the terms and conditions of the Modified 1113(b) proposals. The NLRB is represented by Abby Propis Simms, Esq., Nancy E. Kessler Platt, Esq., Dawn L. Goldstein, Esq., Paul Thomas, Esq., and Julie Kaufman, Esq., in Washington, D.C. About 710 Long Ridge Road Operating Company II 710 Long Ridge Road Operating Company II, LLC and four affiliates own sub-acute and long-term nursing care facilities for the elderly in Connecticut. The facilities, which are managed by HealthBridge Management LLC, are Long Ridge of Stamford, Newington Health Care Center, Westport Health Care Center, West River Health Care Center, and Danbury Health Care Center. 710 Long Ridge Road Operating Company II and its affiliates sought Chapter 11 protection (Bankr. D.N.J. Case Nos. 13-13653 to 13- 13657) on Feb. 24, 2013, to modify their collective bargaining agreements with the New England Health Care Employees Union, District 1199, SEIU. The Debtors owe $18.9 million to M&T Bank and $7.99 million on loans from the U.S. Department of Housing and Urban Development Federal Housing Administration. Michael D. Sirota, Esq., Gerald Gline, Esq., David Bass, Esq., and Ryan T. Jareck, Esq., serve as counsel to the Debtors. Logan & Company, Inc. is the claims and notice agent. Alvarez & Marsal Healthcare Industry Group, LLC, is the financial advisor. Porzio, Bromberg & Newman, P.C.'s Robert M. Schechter, Esq., and Rachel Segall, Esq., represents the Official Committee of Unsecured Creditors. The Committee retained EisnerAmper LLP as accountant. Levy Ratner's Suzanne Hepner, Esq., and Ryan J. Barbur, Esq., represent the New England Health Care Workers, District 1199 SEIU. Abby Propis Simms, Esq., Julie L. Kaufman, Esq., Nancy E. Kessler Platt, Esq., Dawn L. Goldstein, Esq., Paul Thomas, Esq., and John McGrath, Esq., at the National Labor Relations Board Special Litigation Branch in Washington, D.C., argue for the National Labor Relations Board. AEROFLEX INC: Moody's Affirms 'B1' CFR & Sr. Secured Rating ----------------------------------------------------------- Moody's Investors Service affirmed Aeroflex, Incorporated's debt ratings, including the Corporate Family Rating (CFR) and Senior Secured Debt ratings at B1, and the Probability of Default Rating at B2-PD, and raised the Speculative Grade Liquidity Rating to SGL-2 from SGL-3. The outlook is stable. Rating Rationale Aeroflex's cash flow is generally predictable due to: 1) its 'fabless' manufacturing model, as all semiconductor production is outsourced (limiting direct capital expenditures), and 2) the long product life cycles of its core Aeroflex Microelectronic Solutions ("AMS") products and certain Aeroflex Test Solutions (ATS) products. There is meaningful exposure to the defense sector, reflected in Aeroflex's second quarter, 2014 earnings that indicated a recovering ATS segment, offsetting a weakening AMS segment which Moody's believe is feeling the impact of declining US defense spending. Also, Aeroflex has relatively high financial leverage for its rating level. Debt to EBITDA (Moody's adjusted) is currently around 5x, and Moody's anticipates Aeroflex to resume debt repayments in the coming months given the closing of the $28.5 million Shenick acquisition, which should reduce leverage to below 4.5x within the year. Based on consistent free cash flow and expectations of a solid cash balance, Moody's raised the Speculative Grade Liquidity Rating to SGL-2 from SGL-3. The stable rating outlook reflects our expectation that increasing equipment spending by wireless telecommunications carriers in Asia constructing fourth generation networks will support increasing demand for wireless test equipment and revenues in the ATS segment. Moody's believe that this increase in ATS revenues will offset declining revenues in the AMS segment due to declining US defense spending. Moody's believe that the completion of the restructuring of the ATS segment will help support Aeroflex's profitability, with EBITDA margins (Moody's adjusted) maintained in excess of 20%. The ratings could be downgraded if Aeroflex fails to resume the steady reduction in debt such that Moody's believe that debt to EBITDA (Moody's adjusted) will remain in the upper 4x level or FCF to debt (Moody's adjusted) will be maintained below the upper single digits percent level. Inability to generate consistent EBITDA margins of at least 20% and free cash flow of at least $50 million, or maintain a solid cash position could also pressure the rating. The ratings could be upgraded if Aeroflex deleverages through increased EBITDA and debt reduction resulting in total debt to EBITDA (Moody's adjusted) declining to below 3.0x on a sustained basis, and generates solid revenue growth. Upgrades: Issuer: Aeroflex Incorporated (Veritas Capital) Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3 Outlook Actions: Issuer: Aeroflex Incorporated (Veritas Capital) Outlook, Remains Stable Affirmations: Issuer: Aeroflex Incorporated (Veritas Capital) Probability of Default Rating, Affirmed B2-PD Corporate Family Rating, Affirmed B1 Senior Secured Bank Credit Facility Nov 29, 2019, Affirmed B1 Senior Secured Bank Credit Facility Nov 19, 2017, Affirmed B1 Aeroflex, based in Plainview, New York, is a fabless specialty provider of microelectronics and test and measurement products to the aerospace, defense, wireless, broadband and medical markets. The principal methodology used in this rating was the Global Semiconductor Industry Methodology published in December 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. AGFEED INDUSTRIES: Asks Court to Extend Removal Period ------------------------------------------------------ AgFeed Industries, Inc., is asking the U.S. Bankruptcy Court to extend the period within which the Debtors may remove the actions that were pending in various state and federal courts by 90 days, through and including April 10, 2014, with respect to the actions on Jan. 10, 2014. AgFeed said that since the petition date, the debtors have focused primarily on (i) conducting the Agreefeed USA Sale, and the Agreefeed Industries Sale in an effort to maximize the value of the Debtor's estates for the benefit of their stakeholders, (ii) winding down the Debtor's business operations, and (iii) working with the Committees in formulating and filing the plan and Disclosure Statement. In addition, the Debtors have devoted a substantial amount of time and their resources addressing critical case management issues, including but not limited to (i) securing the use of cash collateral, (ii) stabilizing the business, (iii) preparing the schedules of assets and liabilities and statement of financial affairs, (iv) producing monthly operating reports and other reports, (v) retaining professionals, and (vi) beginning the claims and reconciliation process. Hearing on the extension request is set for Feb. 11, 2014, at 10:00 a.m. About AgFeed Industries AgFeed Industries, Inc., has 21 farms and five feed mills in China producing more than 250,000 hogs annually. In the U.S., the business included 10 sow farms in three states and two feed mills producing more than one million hogs a year. AgFeed's revenue in 2012 was $244 million. AgFeed and its affiliates filed voluntary Chapter 11 petitions (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. An 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: Plan Exclusivity Period Extended Thru March 4 ---------------------------------------------------------------- At the behest of AgFeed Industries, Inc., the U.S. Bankruptcy Court extended the Debtors' exclusive period to file a plan of reorganization through and including March 4, 2014. The Debtors' exclusive solicitation period is extended through and including April 30, 2014. This is the Debtor's second request to extend the Exclusive Periods. The Debtors said the extension will provide them with an "unimpeded opportunity" to continue their efforts to confirm a plan of liquidation with minimal interference. To prepare for the solicitation and confirmation process, the Debtors have begun the process of analyzing more than 400 proofs of claim filed in the chapter 11 cases. The Debtors have filed several non-substantive claim objections to clear up the claims register and have worked to supply analysis and information to the equity holder's committee as it conducts its review of several of the larger claims filed in these cases. About AgFeed Industries AgFeed Industries, Inc., has 21 farms and five feed mills in China producing more than 250,000 hogs annually. In the U.S., the business included 10 sow farms in three states and two feed mills producing more than one million hogs a year. AgFeed's revenue in 2012 was $244 million. AgFeed 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. An 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: Hires Plante & Moran as Tax Services Provider ---------------------------------------------------------------- AgFeed USA, LLC and its debtor-affiliates seek authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Plante & Moran, PLLC as tax services provider, nunc pro tunc to Sept. 10, 2013. The Debtors have engaged Plante & Moran to render tax compliance services to the Debtors for the fiscal year ending Dec. 31, 2013 (the "Supplemental Tax Services"). As described more fully in the Supplemental Engagement Letter, the Supplemental Tax Services include the preparation of: -- U.S. Corporate Income Tax Return; -- Information Return of U.S. Persons with Respect to Certain Foreign Corporations; -- Information Return of U.S. Persons with Respect to Foreign Disregard Entities; -- Return of U.S. Persons with Respect to Certain Foreign Partnerships; -- Colorado, Florida, Iowa, Massachusetts, North Carolina, and Oklahoma Corporate Income Tax Returns; -- Oklahoma Annual Business Activity Tax Return; and -- Tennessee Franchise/Excise Tax Return. Plante & Moran will provide additional services, including amending prior year tax returns, accounting, consulting, or tax assistance at the request of the Debtors. The Debtors and Plante & Moran have agreed that any additional services will be billed at the hourly rates specified in the Supplemental Engagement Letter. Plante & Moran will be paid at these hourly rates: Partner $250-$400 Manager $130-$250 In-charge $90-$130 Staff $60-$90 Plante & Moran will also be reimbursed for reasonable out-of- pocket expenses incurred. Based on past year-end audits performed by Plante & Moran of similarly sized corporations, Plante & Moran estimates that its fee for the Supplemental Tax Services will be approximately $70,000, plus all reasonable and necessary travel and out-of- pocket expenses incurred. Annette Tenerelli-Lemke, partner of Plante & Moran PLLC, 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. The Court for the District of Delaware will hold a hearing on the application on Mar. 11, 2014 10:00 a.m. Objections were due Feb. 5, 2014. Plante & Moran can be reached at: Annette Tenerelli-Lemke PLANTE & MORAN, PLLC Suite 400, 1000 Oakbrook Drive Ann Arbor, MI 48104 Tel: (734) 665-9494 Fax: (734) 665-0664 About AgFeed Industries AgFeed Industries, Inc., has 21 farms and five feed mills in China producing more than 250,000 hogs annually. In the U.S., the business included 10 sow farms in three states and two feed mills producing more than one million hogs a year. AgFeed's revenue in 2012 was $244 million. AgFeed 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. An 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. ALLENS INC: Bain, Gordon Brothers Venture to Pay $160MM for Co. --------------------------------------------------------------- Katy Stech, writing for Daily Bankruptcy Review, reported that an investment vehicle formed by Bain Capital LLC's Sankaty Advisors LLC and Gordon Brothers Group's investment arm won the bidding for Arkansas vegetable canner Allens Inc. with a $160 million offer, topping stalking horse bidder Seneca Foods Corp. at a bankruptcy auction. According to the report, the investment vehicle, Sager Creek Acquisition Corp., won a bankruptcy auction for Allens, which employs about 1,175 people and calls itself one of the largest private canning companies in the world with brands like Veg-All, Popeye canned spinach and Sugary Sam sweet potatoes. The purchase price was disclosed on Feb. 7 in documents filed to the U.S. Bankruptcy Court in Fayetteville, Ark. About Allens Inc. Siloam Springs, Arkansas-based Allens, Inc., a maker of canned and frozen vegetables in business since 1926, filed for bankruptcy (Bankr. W.D. Ark. Case No. 13-73597) on Oct. 28, 2013, seeking to sell some divisions or reorganize as a new company. The Debtors' proposed counsel are Stan D. Smith, Esq., Lance R. Miller, Esq., and Chris A. McNulty, Esq., at Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C., in Little Rock, Arkansas; and Nancy A. Mitchell, Esq., Maria J. DiConza, Esq., and Matthew L. Hinker, Esq., at Greenberg Traurig, LLP, in New York. Jonathan Hickman of Alvarez & Marsal North America, LLC, serves as the Debtors' chief restructuring officer. Cary Daniel, Nick Campbell and Markus Lahrkamp of A&M serve as assistant CROs. Lazard Freres & Co. LLC and Lazard Middle Market LLC serve as investment bankers, while GA Keen Realty Advisors, LLC, serves as real estate advisor to the Debtors. The Official Committee of Unsecured Creditors has tapped Eichenbaum Liles P.A.'s Martha Jett McAlister, Esq.; and Cooley LLP's Cathy Hershcopf, Esq., Jeffrey L. Cohen, Esq., Seth Van Aalton, Esq., and Robert B. Winning, Esq., as counsel. ALTREC INC: Auction on Assets Scheduled for Feb. 20 --------------------------------------------------- Judge Randall L. Dunn of the U.S. Bankruptcy Court for the District of Oregon authorized Altrec, Inc., to sell all or substantially all of its assets to Great Outdoors Holdco, LLC, an affiliate of Remington Outdoor Company, for $3.25 million, subject to better and higher bids to be determined at an auction scheduled for Feb. 20. A final hearing on the sale motion will be held on Feb. 24, at 1:30 p.m. About Altrec Inc. Redmond, Washington-based Altrec, Inc., an Internet retailer of outdoor apparel and equipment, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ore. Case No. 14-30037) on Jan. 6, 2014. The case is assigned to Judge Randall L. Dunn. The Debtor's counsel is David A Foraker, Esq., at Greene & Markley, P.C., in Portland, Oregon. The Debtor has assets ranging from $1 million to $10 million and liabilities ranging from $10 million to $50 million. The petition was signed by Michael Morford, president. According to Bill Rochelle, the bankruptcy columnist for Bloomberg News, Altrec generated $59 million in sales on its Altrec.com website in 2011. Revenue declined after a denial-of-service cyber attack during the 2011 Christmas season and a possible theft of customer information by a hacker, Mr. Rochelle said. There is $5.7 million owing to the secured lenders, Mr. Rochelle noted. The sale to Remington calls for the bankrupt estate to retain $250,000, with the remainder going to secured creditors. A court paper shows the liquidation value of the assets as not exceeding $1.2 million. The lender terminated a $7.5 million working capital credit in 2013, and secured noteholders owed $3.5 million initiated a receivership in December, Mr. Rochelle related. Altrec had sales of $20.1 million during the first 11 months of 2011, producing a net loss of $5.1 million. Assets are on the books for $5.7 million against debt totaling $24.2 million, Mr. Rochelle further related. An official committee of unsecured creditors was appointed by the U.S. Trustee on Jan. 14. The Committee members are Columbia Sportswear, Keen, Inc., Icebreaker Nature Clothing, Amer Sports Winter & Outdoor Co, Arcteryx Equipment, Inc., Patagonia, and The North Face, Inc. Cooley LLP serves as lead co-counsel to the Committee. McKittrick Leonard LLP serveas as local co-counsel to the Committee. ALVARION(R) LTD: Appeals NASDAQ Delisting of Shares --------------------------------------------------- Alvarion(R) Ltd. (in interim liquidation and receivership) has submitted a request to have the NASDAQ Listing and Hearing Review Council review the January 13, 2014 determination of the NADSAQ Listing Qualifications Hearings Panel to delist the Company's ordinary shares from The NASDAQ Capital Market. The Company's shares will not be delisted from NASDAQ pending the decision by the Listing Council; however, the trading suspension will remain in effect until such decision. Alvarion's ordinary shares are currently trading on the OTCQB under the ticker ALVRQ. About Alvarion With headquarters in Tel Aviv, Israel, Alvarion Ltd. provides optimized wireless broadband solutions addressing the connectivity, coverage and capacity challenges of telecom operators, smart cities, security, and enterprise customers. The Company reported a net loss of $55.9 million on $49.9 million of revenue in 2012, compared with a net loss of $33.8 million on $69.5 million of revenue in 2011. In July 2013, Alvarion said it has agreed to the appointment of a receiver and won't contest an attempt by Silicon Valley Bank to secure a winding up order from theDistrict Court of Tel-Aviv - Yaffo. Mr. Yoav Kfir, CPA, has been named as the company's receiver. The District Court of Tel Aviv -- Yaffo's on July 21, 2013, approved an operating plan to allow the normal business operation of the company. AMERICAN AIRLINES: Workers Claim Unions Withheld Equity ------------------------------------------------------- Law360 reported that a former American Airlines Inc. worker hit the Transport Workers Union of America with a putative class action on Jan. 30 in Texas federal court, alleging the union refused to give workers who took an early retirement $32.5 million in American stock that they were owed under a collective bargaining agreement. According to the report, plaintiff Thomas A. Powell claims a 2012 settlement over the bargaining agreement allowed the union to avoid involuntary furloughs in exchange for "early separations" and said workers would receive American equity once it emerged from bankruptcy. The case is Powell v. Transport Workers Union of America, AFL-CIO et al, Case No. 3:14-cv-00375 (N.D. Tex.). The case is assigned to Senior Judge A. Joe Fish. About American Airlines AMR Corp. and its subsidiaries including American Airlines filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan on Nov. 29, 2011, after failing to secure cost- cutting labor agreements. AMR, previously the world's largest airline prior to mergers by other airlines, is the last of the so- called U.S. legacy airlines to seek court protection from creditors. It was the third largest airline in the United States at the time of the bankruptcy filing. Weil, Gotshal & Manges LLP serves as bankruptcy counsel to the Debtors. Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law Group, Chartered, are on board as special counsel. Rothschild Inc., is the financial advisor. Garden City Group Inc. is the claims and notice agent. Jack Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP serve as counsel to the Official Committee of Unsecured Creditors in AMR's chapter 11 proceedings. Togut, Segal & Segal LLP is the co-counsel for conflicts and other matters; Moelis & Company LLC is the investment banker, and Mesirow Financial Consulting, LLC, is the financial advisor. The Retiree Committee is represented by Jenner & Block LLP's Catherine L. Steege, Esq., Charles B. Sklarsky, Esq., and Marc B. Hankin, Esq. AMR and US Airways Group, Inc., on Feb. 14, 2013, announced a definitive merger agreement under which the companies will combine to create a premier global carrier, which will have an implied combined equity value of approximately $11 billion. The bankruptcy judge on Sept. 12, 2013, confirmed AMR Corp.'s plan to exit bankruptcy through a merger with US Airways. By distributing stock in the merged airlines, the plan is designed to pay all creditors in full, with interest. Judge Sean Lane confirmed the Plan despite the lawsuit filed by the U.S. Department of Justice and several states' attorney general complaining that the merger violates antitrust laws. In November 2013, AMR and the U.S. Justice Department a settlement of the anti-trust suit. The settlements require the airlines to shed 104 slots at Reagan National Airport in Washington and 34 at LaGuardia Airport in New York. AMR stepped out of Chapter 11 protection after its $17 billion merger with US Airways was formally completed on Dec. 9, 2013. AMERICAN PETROLEUM: Moody's Withdraws B2 CFR & Senior Sec. Rating ----------------------------------------------------------------- Moody's Investors Service has withdrawn all of the ratings assigned to American Petroleum Tankers Parent LLC following the completion of the previously announced sale of the company to Kinder Morgan Energy Partners LP (Baa2, stable) and payoff of its outstanding debt. The following ratings have been withdrawn: B2 Corporate Family rating, B3-PD Probability of Default rating, B2 Senior Secured rating with Loss Given Default Assessment of 35-LGD 3 and the stable outlook. Ratings Rationale Moody's has withdrawn all of the ratings of American Petroleum Tankers because the previously rated obligations are no longer outstanding. American Petroleum Tankers Parent LLC, headquartered in Plymouth Meeting, PA, owned a fleet of five modern U.S. Jones Act petroleum products tankers, trading them under time charters with major oil companies or the US Military Sealift Command. Outlook Actions: Issuer: American Petroleum Tankers Parent LLC Outlook, Changed To Rating Withdrawn From Stable Withdrawals: Issuer: American Petroleum Tankers Parent LLC Probability of Default Rating, Withdrawn, previously rated B3-PD Corporate Family Rating, Withdrawn, previously rated B2 Senior Secured Bank Credit Facility Mar 28, 2018, Withdrawn, previously rated B2 Senior Secured Bank Credit Facility Sep 28, 2019, Withdrawn, previously rated B2 Senior Secured Bank Credit Facility Mar 28, 2018, Withdrawn, previously rated a range of LGD3, 35 % Senior Secured Bank Credit Facility Sep 28, 2019, Withdrawn, previously rated a range of LGD3, 35 % AMG CAPITAL: Fitch Rates Trust Preferred Securities 'BB' -------------------------------------------------------- Fitch Ratings has assigned a 'BBB' rating to Affiliated Managers Group Inc.'s (AMG) $400 million senior unsecured notes. The notes have a coupon of 4.25% and will mature in February 2024. Key Rating Drivers The notes will rank equally with AMG's other unsecured debt outstanding. Proceeds from the issuance will be used to repay borrowings under AMG's unsecured revolving credit facility. As of Dec. 31, 2013, AMG had $525 million outstanding under its revolving credit facility. Given that the proceeds from the new issuance will be used to repay outstanding borrowings under the revolving credit facility, Fitch does not envision there being a material impact on the company's leverage levels as a result of the issuance. Leverage, measured as gross debt to adjusted EBITDA, was 1.5x at Dec. 31, 2013, down from 2.4x at year-end 2012, mainly due to robust EBITDA generation and a slight decline in debt levels as a result of the paydown of senior convertible notes in 3Q'13. Interest coverage, measured as adjusted EBITDA to interest expense, net of non-cash items, was 11.0x at Dec. 31, 2013, up from 8.2x at year-end 2012. Interest coverage is expected to decline slightly following the issuance as the 4.25% coupon on the 10-year $400 million issuance is higher than the pricing on the revolving credit facility (LIBOR plus 150 basis points). AMG had a very strong year in terms of assets under management (AUM) growth and operating performance. AUM increased to $537 billion at year-end 2013, up $105 billion or 24% from $432 billion at year-end 2012. The growth was driven not just by market appreciation ($60 billion) but also by strong organic inflows ($41 billion). Adjusted EBITDA increased 39% to $859 million in 2013, from $616 million in 2012 and GAAP net income more than doubled to $361 million in 2013, from $174 million in 2012. The increase was mainly due to higher management fees from higher AUM levels and increased contribution from performance fees. RATING SENSITIVITIES AMG's ratings reflect its increased scale and diversity in the asset management space, strong cash flow generation, improved funding profile, as well as management's commitment to leverage of 2.75x or less. Ratings take into account AMG's highly acquisitive business model and AUM concentration in equities, which is a relatively more volatile asset class. Positive rating action could be driven by sustained improvement in leverage and interest coverage metrics and increased AUM diversification while maintaining solid investment performance at the affiliate level. Fitch expects that AMG will remain disciplined in its future acquisition strategy with regard to pricing multiples and transaction size. Aggressive acquisitions funded by increased debt levels, deterioration in leverage above management's articulated level, prolonged investment underperformance at major affiliates, significant increase in equity puts by affiliates leading to liquidity strains and/or unexpected operational losses or significant net outflows could lead to negative rating action. AMG is a global asset management company with equity investments in leading boutique investment management firms. As of Dec. 31, 2013, the aggregate AUM of AMG's affiliates were approximately $544 billion (pro forma for a pending investment) in more than 400 investment products across a broad range of investment styles, asset classes and distribution channels. Fitch currently rates AMG as follows: Affiliated Managers Group, Inc. -- Long-term IDR 'BBB'; -- Senior bank credit facility 'BBB'; -- Senior unsecured debt 'BBB'. AMG Capital Trust I AMG Capital Trust II -- Trust preferred securities 'BB'. The Rating Outlook is Stable. APEX TOOLS: Moody's Cuts Corp. Family Rating to 'B3', Outlook Neg. ------------------------------------------------------------------ Moody's Investors Service downgraded Apex Tools Group, LLC's Corporate Family Rating to B3 from B2, the Probability of Default Rating to B3-PD from B2-PD, the company's first lien senior secured credit facilities, consisting of $175 million revolver due 2018 and $835 million term loan due 2020, to B2 from B1, and the $450 million senior unsecured notes due 2021 to Caa1 from B3. The rating outlook is negative. The following rating actions have been taken: Corporate Family Rating, downgraded to B3 from B2; Probability of Default Rating, downgraded to B3-PD from B2-PD; $175 million senior secured revolving credit facility due 2018, downgraded to B2, LDG3-43% from B1, LGD3-37%; $835 million senior secured term loan facility due 2020, downgraded to B2, LGD3-43% from B1, LGD3-37%; $450 million senior unsecured notes due 2021, downgraded to Caa1, LGD4-65% from B3, LGD5-74% assigned; The rating outlook is negative. Ratings Rationale The ratings downgrade reflects Apex Tool Group's high adjusted debt leverage which was materially higher than our expectation at the time Apex was originally rated under the current ownership structure. Weak operating performance was a primary contributor to the increase in debt leverage as well as lower than expected debt reduction. Moody's expect adjusted debt-to-EBITDA to remain above 7.0x over the intermediate term. Furthermore, Moody's expect EBITA-to-interest expense to remain weak. The B3 corporate family rating reflects Apex's high adjusted debt- to-EBITDA and adjusted debt-to-capitalization leverage, small equity base, modest operating margins in a very competitive industry, and cyclicality within its various end markets. Positively, the ratings also reflect the company's solid market positions within its hand and power tool business segments, breadth of product offerings and brand names, its global reach, extensive operational footprint and distribution channels as well as diversity of customers and industries served. Over time, Moody's expect Apex to expand its profitability through a combination of higher sales and a reduced cost structure as a result of 2013 manufacturing restructuring initiatives. However, fundamentals in Apex's end markets have been uneven, and Moody's are concerned that slowing growth, especially in emerging markets, could pressure earnings in 2014. The company has good liquidity supported by its $175 million senior secured revolving credit facility, cash flow from operations and lack of significant debt maturities until 2018, when its revolving credit facility expires. The ratings incorporate Moody's expectation that Apex will have reasonable room under its 4.75x senior secured net leverage covenant in the credit agreement, which is applicable only if revolver outstandings exceed $35 million. As of September 27, 2013, the company had approximately $118 million of remaining revolver availability, after accounting for $54 million of borrowings and $3.1 million of letter of credit commitments. Apex was in compliance with its senior secured net leverage covenant. The negative outlook reflects our concern over near-term earnings weakness, softness in North American demand as well as slowing growth in emerging markets . A return to stable outlook would be predicated upon adjusted debt leverage below 7.0X and EBITA-to-interest coverage closer to 2.0X, both on a sustainable basis, driven by earnings growth and margin expansion. Strengthening fundamentals in key end markets would also support a stable outlook. Downward pressure on the rating could result if, over an extended period of time, the company's adjusted debt-to-EBITDA remains above 7.0x, adjusted debt-to-capitalization remains above 75% , or EBITA-to interest coverage remains below 2.0x. A rating downgrade could also occur if liquidity weakens significantly. The principal methodology used in this rating was the Global Manufacturing Industry published in December 2010. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Apex Tool Group, LLC ("Apex"), headquartered in Sparks, MD, is a global manufacturer of hand and power tools for commercial, industrial and do-it-yourself customers. Apex was established as a joint venture between Danaher Tool Group and Cooper Industries' Cooper Tools in July 2010. On February 1, 2013, the company was acquired by the private equity sponsor, Bain Capital Partners LLC for $1.55 billion. Apex operates two business segments: Hand Tools Segment that produces mechanic tools and trade tools, and represents about 73% of its total revenues, and Power Tools Segment that produces electric and pneumatic fastening and torque controlling tools, drilling, cutting, and materials removal tools, and soldering tools, and represents 27% of total revenues. The company serves customers in automotive, aerospace, electronics, hardware, energy, and consumer retail industries. Apex has operations North America, Europe, Asia, Australia and Latin America. In the LTM period ending September 27, 2013, the company generated about $1.45 billion in revenues and $132 million in adjusted EBITDA. ARCAPITA BANK: Court Confirms 2nd Amended Plan as to Falcon Gas --------------------------------------------------------------- Reorganized Debtors Arcapita Bank B.S.C.(c), et al., confirmed the Second Amended Joint Plan of Reorganization as to Falcon Gas Storage Company, Inc. At the June 11, 2013, hearing to consider confirmation of Arcapita Bank B.S.C.(c), et al.'s Plan, the Court confirmed the Plan as to all Debtors except Falcon. The Court adjourned the hearing to consider confirmation of the Plan with respect to Falcon, pending the ruling of the Bankruptcy Court on objections to provisions of the Plan providing for the fully subordinated treatment of the Claims of Tide Natural Gas Storage I LP and Tide Natural Gas Storage II, LP in Classes 10(a) and 10(g) of the Plan, which had been argued before the Court at a hearing on June 10, 2013, and then taken under advisement. Reorganized Debtor said that objections to the plan confirmation were resolved. The objections were filed by: 1. Tide Natural Gas Storage I, LP formerly known as Alinda Natural Gas Storage I, LP, and Tide Natural Gas Storage II, LP f/k/a Alinda Natural Gas Storage II, LP; 2. ACE American Insurance Company; 3. Mayhoola for Investment Q.S.P.C.; 4. Mounzer Nasr or Beatriz Flecha de Lima Nasr All objections that have not been withdrawn, waived, or settled pertaining to the confirmation of the Plan are overruled on the merits. On Jan. 15, 2014, Falcon filed a blackline comparison showing all of the modifications made to the filed Plan. The Court reviewed the modifications, and held that the modifications are not material or adverse to any party-in-interest as to Falcon, and Falcon is not required to solicit new acceptances of the Plan from the Holders of claims and interests eligible to vote to accept or reject the Plan as to Falcon. About Arcapita Bank Arcapita Bank B.S.C., also known as First Islamic Investment Bank B.S.C., along with affiliates, filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19, 2012. The Debtors said they do not have the liquidity necessary to repay a US$1.1 billion syndicated unsecured facility when it comes due on March 28, 2012. Falcon Gas Storage Company, Inc., filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas is an indirect wholly owned subsidiary of Arcapita that previously owned the natural gas storage business NorTex Gas Storage Company LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock of NorTex from Falcon Gas for $515 million. Arcapita guaranteed certain of Falcon Gas' obligations under the NorTex Purchase Agreement. The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP as international counsel on Bahrain matters, Hatim S Zu'bi & Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild Inc. and financial advisor, and GCG Inc. as notice and claims agent. Milbank, Tweed, Hadley & McCloy LLP represented the Official Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc., served as its financial advisor and investment banker. Founded in 1996, Arcapita is a global manager of Shari'ah- compliant alternative investments and operates as an investment bank. Arcapita is not a domestic bank licensed in the United States. Arcapita is headquartered in Bahrain and is regulated under an Islamic wholesale banking license issued by the Central Bank of Bahrain. The Arcapita Group employs 268 people and has offices in Atlanta, London, Hong Kong and Singapore in addition to its Bahrain headquarters. The Arcapita Group's principal activities include investing on its own account and providing investment opportunities to third-party investors in conformity with Islamic Shari'ah rules and principles. The Arcapita Group had roughly US$7 billion in assets under management. On a consolidated basis, the Arcapita Group owns assets valued at roughly US$3.06 billion and has liabilities of roughly US$2.55 billion. The Debtors owe US$96.7 million under two secured facilities made available by Standard Chartered Bank. Arcapita explored out-of-court restructuring scenarios but was unable to achieve 100 percent lender consent required to effectuate the terms of an out-of-court restructuring. Subsequent to the Chapter 11 filing, Arcapita Investment Holdings Limited, a wholly owned Debtor subsidiary of Arcapita in the Cayman Islands, issued a summons seeking ancillary relief from the Grand Court of the Cayman Islands with a view to facilitating the Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as provisional liquidator. As reported in the TCR on Jun 19, 2013, the Bankruptcy Court for the Southern District of New York entered its Findings of Fact, Conclusions of Law, and Order confirming the Second Amended Joint Chapter 11 Plan of Reorganization of Arcapita Bank B.S.C.(c) and Related Debtors with respect to each Debtor other than Falcon Gas Storage Company, Inc. A copy of the Confirmed Second Amended Joint Plan (With First Technical Modifications) is available at: http://bankrupt.com/misc/arcapita.doc1265.pdf The effective date of the Debtors' Second Amended Joint Plan of Reorganization, dated as of June 11, 2013, occurred on Sept. 17, 2013. ARCHDIOCESE OF MILWAUKEE: Committee Won't Oppose Quarles Fee Hike ----------------------------------------------------------------- The committee representing unsecured creditors of the Archdiocese of Milwaukee said it doesn't oppose the archdiocese's bid to increase the fee cap of its legal counsel. The archdiocese earlier proposed to increase the fee cap to $500,000 from $300,000 for additional services the firm will provide in connection with the case it filed against insurers. In a court filing, the committee said the fee cap increase may be necessary to permit Quarles to continue its work on the case brought by the archdiocese against OneBeacon Insurance Co. "The debtor's success in this suit would inure to the benefit of the estate and its creditors by recovering badly needed cash for the estate," the committee said. The lawsuit seeks to recover from OneBeacon more than $2.6 million, which the archdiocese has expended in the litigation of claims filed by clergy sex abuse victims. About Archdiocese of Milwaukee The Diocese of Milwaukee was established on Nov. 28, 1843, and was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ARCHDIOCESE OF MILWAUKEE: Opposes OneBeacon Bid for Lift Stay ------------------------------------------------------------- The Archdiocese of Milwaukee asked the U.S. Bankruptcy Court for the Eastern District of Wisconsin to deny the request of OneBeacon Insurance Co. to lift the automatic stay in connection with the petition for review it filed before the Wisconsin Supreme Court. OneBeacon wanted the legal injunction lifted to permit the archdiocese's petition as well as any subsequent review by the Supreme Court to proceed. The archdiocese filed the petition to review an opinion handed down by the Court of Appeals of Wisconsin in favor of clergy sex abuse victims who sued the archdiocese for negligent misrepresentation and fraud. Daryl Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, said the archdiocese would be "negatively impacted" if OneBeacon were to succeed. "OneBeacon's refusal to pay defense costs would directly impact the amount of money that might otherwise be available to fund a plan of reorganization," the archdiocese's lawyer said in a court filing. He said it would limit the pool of money that would otherwise go to creditors. OneBeacon allegedly stopped making payments after the appeals court affirmed the decision by lower courts, which handled the cases filed by sex abuse victims, that the claims for negligent misrepresentation did not trigger insurance coverage. The appeals court's opinion concluded that the allegations underlying the victims' complaints constituted volitional acts, rather than accidents that would be covered under the policy provided by insurance firms including OneBeacon. The sex abuse victims alleged in their complaints that the archdiocese's agents continued to allow the priests with history of sexual abuse to have access to children through parishes and schools although they were already confronted by former sex abuse victims. The victims also alleged that despite the archdiocese's knowledge of the priests' history of sexual abuse, it represented that children were safe in their presence. Meanwhile, a group of claimants represented by Jeff Anderson & Associates P.A., said it doesn't oppose the termination of the automatic stay. The group said it should be permitted to pursue any potential claims it may have against OneBeacon in the Wisconsin Circuit Courts outside of the bankruptcy proceeding in case the bankruptcy court ruled in favor of the insurance company. Jeff Anderson & Associates can be reached at: Jeffrey R. Anderson, Esq. Michael G. Finnegan, Esq. 366 Jackson Street, Suite 100 St. Paul, MN 55101 Tel: 651-227-9990 Fax: 651-297-6543 Email: jeff@andersonadvocates.com mike@andersonadvocates.com About Archdiocese of Milwaukee The Diocese of Milwaukee was established on Nov. 28, 1843, and was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius IX. The region served by the Archdiocese consists of 4,758 square miles in southeast Wisconsin which includes counties Dodge, Fond du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington and Waukesha. There are 657,519 registered Catholics in the Region. The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No. 11-20059) on Jan. 4, 2011, to address claims over sexual abuse by priests on minors. The Archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The Official Committee of Unsecured Creditors in the bankruptcy case has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and Howard, Solochek & Weber, S.C., as its local counsel. The Archdiocese estimated assets and debts of $10 million to $50 million in its Chapter 11 petition. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ARMORWORKS ENTERPRISES: Plan Confirmation Hearing Moved to March 4 ------------------------------------------------------------------ The Hon. Brenda Moody Whinery of the U.S. Bankruptcy Court for the District of Arizona has rescheduled March 4, 2014 at 10:30 a.m. the hearing to consider confirmation of the proposed restructuring plan for ArmorWorks Enterprises, LLC and TechFiber, LLC. As reported by the Troubled Company Reporter on Jan. 27, 2014, the Court was set to hold the confirmation hearing on Jan. 29. The Court approved on Dec. 30 the outline of the Plan jointly proposed ArmorWorks and its subsidiary Techfiber, C Squared Capital Partners LLC, Anchor Management LLC, ArmorWorks Inc., William Perciballi and the unsecured creditors' committee. Under the Plan, all claims against and member equity interests in ArmorWorks and Techfiber will be paid through a sale of assets or equity. The Court, at the behest of the Debtors, also extended the voting deadline and the deadline for filing any objections to confirmation of the Plan to Feb. 24, 2014, from Jan. 22, 2014. The Debtors determined that the Plan, the disclosure statement, the court order (i) approving the disclosure statement; (ii) fixing time for filing acceptances or rejections of the Plan; and (iii) setting initial confirmation hearing and deadline for objections, and ballots were not properly noticed to all creditors and parties in interest. The deadline for returning ballots evidencing written acceptance or rejection of the Plan is extended to 4:00 p.m. MST, Feb. 24, 2014. The last day for filing and serving written objections to confirmation of the Plan is Feb. 24, 2014. Any written declarations in support of confirmation of the Plan and a written ballot report will be filed by the Plan Proponents on or before Feb. 28, 2014. On Jan. 22, 2014, the United States of America, on behalf of the Department of the Defense and its agency the Defense Logistics Agency and its components, filed an objected to the Plan, "to the extent it provides for a sale transaction that includes the assumption and assignment of government contracts without DoD permission and in violation of federal law." DoD filed on Jan. 16, 2014, an objection of the United States to the Debtors' motion for orders approving the sale of Debtor's assets free and clear of all liens, claims and interests, or an equity sale under the Plan and to assume and assign executory contracts and unexpired leases. Additionally, the DoD objects to the Plan to the extent that it states that the claims for rejection of executory contracts constitute class 4 or 5 general unsecured claims. The DoD has a secured claim to the extent of its setoff rights to $667,022.85. If Defense Logistics Agency - Troop Support contract number SPM1C1-08-D-0123DoD is rejected, the DoD will have a class 2 secured claim in the amount of $667,022.85, as well as a class 4 general unsecured claim in the amount of $3,812,720.15. The United States requests that the Court deny confirmation of the Plan to the extent it seeks to classify the secured claim of the United States as a general unsecured claim. The State of Arizona ex rel. Arizona Department of Revenue also filed an objection to the Plan on Jan. 22, saying that the Plan fails to clearly provide for payment of the Department's priority claims and is unclear as to Debtors' intention to pay the Department's priority tax claim for over $380,000. The Department filed a proof of claim for Armorworks establishing that it has a priority claim in the amount of $361,113.86 and a general unsecured claim in the amount of $35. The Department filed a proof of claim for Techfiber establishing that it has a priority claim in the amount of $20,722.34, of which $8,112is estimated, and a general unsecured claim in the amount of $13.02. The Department had to issue an assessment and to estimate a portion of the liability for Techfiber due to its failure to file certain transaction privilege tax returns. About ArmorWorks Enterprises Military armor systems provider ArmorWorks Enterprises, LLC, and affiliate TechFiber LLC sought Chapter 11 protection (Bankr. D. Ariz. Case Nos. 13-10332 and 13-10333) in Phoenix on June 17, 2013, along with a plan that resolves a dispute with a minority shareholder and $3.5 million of financing that would save the company from running out of cash. ArmorWorks develops advanced survivability technology and designs and manufactures armor and protective products. ArmorWorks has produced over 1.25 million ceramic armor and composite armor protection components for a variety of personnel armor, aircraft, and vehicle applications. The Debtors have tapped Todd A. Burgess, Esq., John R. Clemency, Esq., Lindsi M. Weber, Esq., and Janel M. Glynn, Esq., at Gallagher & Kennedy, as counsel; and MCA Financial Group, Ltd., as financial advisor. ArmorWorks estimated $10 million to $50 million in assets and liabilities. The U.S. Trustee for Region 14 appointed creditors to serve on an Official Committee of Unsecured Creditors. Forrester & Worth, P.L.L.C. represents the Committee as its general counsel. As of May 26, 2012, ArmorWorks had total assets of $30.9 million and total liabilities of $12.04 million. ArmorWorks and TechFiber sought and obtained an order (i) transferring the In re TechFiber, LLC chapter 11 case to the Honorable Brenda Moody Whinery, the judge assigned to the ArmorWorks Chapter 11 case, and (ii) authorizing the joint administration of the Debtors' cases. Judge Whinery approved on Dec. 30, 2013, the disclosure statement explaining the bankruptcy-exit plan for the Debtors. The plan was jointly proposed by the Debtors, C Squared Capital Partners LLC, Anchor Management LLC, ArmorWorks Inc., William Perciballi and the unsecured creditors' committee. The plan proposes to pay all claims against and member equity interests in ArmorWorks and Techfiber through a sale of assets or equity. Proceeds from the sale will be used to pay off creditors and members of ArmorWorks. Judge Whinery also has approved the bid process proposed by ArmorWorks and Techfiber in connection with the sale of their assets or equity of the reorganized companies. Pursuant to the bid procedures, interested buyers were required to submit their bids by Feb. 7. An auction will be held on Feb. 21 at the Phoenix office of Gallagher & Kennedy, P.A. A status hearing regarding the auction will be held on Feb. 19 while a hearing to consider approval of the sale is scheduled for March 4. ARXX CORP: U.S. Court OKs Stalking Horse Deal w/ Airlite Plastics ----------------------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware, at the behest of Duff & Phelps Canada Restructuring Inc., in its capacity as the court-appointed receiver and foreign representative for ARXX Corporation, et al., recognized in full and given full force and effect in the United States the stalking horse order and vesting order approved by the Ontario Superior Court of Justice, Commercial List, which is overseeing ARXX's insolvency proceeding. The stalking horse order approves Airlite Plastics Co. as the stalking horse bidder for the Debtors' assets. The Airlite Purchase Agreement provides for a $2.8 million base cash purchase price, plus the "working capital amount" and certain assumed liabilities. As of Dec. 19, 2013, the value of the transaction is estimated to total approximately $3.8 million. The Working Capital Amount is estimated to total approximately $1 million. The Airlite Purchase Agreement provides for the payment to Airlite of $150,000 break-up fee and $150,000 reimbursement for expenses incurred in connection with the purchase agreement and the sale transaction. The ARXX Debtors and Airlite agreed that the closing date is Feb. 3. Should the parties be unable to close on Feb. 3, the Closing Date will be Feb. 10, or other date as agreed by the parties. The case is In re ARXX Corp., 13-bk-13313, U.S. Bankruptcy Court, District of Delaware (Wilmington). Judge Kevin J. Carey presides over the Chapter 15 case. The Debtor is represented by Duff & Phelps Canada Restructuring Inc. as receiver and foreign representative. Duff & Phelps is represented by Matthew Barry Lunn, Esq., Justin P. Duda, Esq., and Ian J. Bambrick, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware. AURORA USA: Moody's Places 'B3' CFR for Possible Upgrade -------------------------------------------------------- Moody's Investors Service placed Aurora USA Oil & Gas, Inc.'s B3 Corporate Family Rating (CFR), B3-PD Probability of Default Rating and the Caa1 rating on the company's senior unsecured notes on review for upgrade. The SGL-2 liquidity rating remains unchanged. This action is in response to the announcement that Baytex Energy Corp. (Baytex, Ba3) will acquire Aurora Oil & Gas Limited, Aurora's parent, in a transaction valued at roughly CDN$2.6 billion (USD$2.35 billion) including Aurora debt of roughly USD$665 million. The transaction is expected to close before June 2014. "The acquisition is favorable for Aurora's creditors as the unsecured notes are now likely to benefit from the credit profile of a higher rated acquirer, Baytex, which is rated Ba3," commented Arvinder Saluja, Moody's Assistant Vice President - Analyst. "Aurora has exhibited positive momentum in its production and reserves growth, but the better credit profile of Baytex is the catalyst that calls for a ratings review." Issuer: Aurora USA Oil & Gas, Inc. Review for Upgrade: Corporate Family Rating, B3 Senior Unsecured Debt, Rated Caa1 Probability of Default, Rated B3-PD Outlook: Ratings Under Review Ratings Rationale The majority of the acquisition will be financed with a Baytex equity issue of CDN$1.3 billion, a new Baytex CDN$200 million term loan and the remaining amount under draws from Baytex's existing revolver which is expected to increase to CDN$1 billion. The transaction is credit positive for Aurora as it will have the support of a parent with a Ba3 CFR, three notches above Aurora's current B3 CFR. The review will focus on the nature of the support to Aurora likely to be provided by Baytex, the final structure of the transaction, including the put on Aurora's debt, and Baytex's own rating on closing, expected by June, 2014. The principal methodology used in this rating was the Global Independent Exploration and Production Industry published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Aurora USA Oil & Gas, Inc. is headquartered in Houston, Texas. Aurora Oil & Gas Limited is based in Perth, Australia. BEHAVIORAL HEALTH: Files for Ch. 7; Creditors Meeting Feb. 26 ------------------------------------------------------------- Behavioral Health Management Solutions Inc. filed a bankruptcy petition for liquidation under Chapter 7 of the U.S. Bankruptcy Code on Jan. 16, 2014 in 2971 in Central Florida. The Debtor declared $0 in assets and $30,000 in liabilities. The largest unsecured creditor is Bad Moon Rising III LLC, care of Ralph H. Schofield, Jr. with $30,000 claims. The creditors' meeting is set for Feb. 26. The company is located at 1904 Silverleaf Lane, Apt. 101, Orlando, Fla. BIOSCRIP INC: S&P Affirms 'B' CCR & Revises Outlook to Negative --------------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'B' corporate credit rating on BioScrip Inc. and revised the outlook to negative, reflecting 2013 cash flow deficits and S&P's reduced confidence that the company can return to positive cash flow generation in 2014. S&P also raised its issue-level rating on the company's senior secured credit facilities to 'BB-' from 'B'. S&P revised the recovery rating to '1' from '3', indicating expectations for very high recovery (90%-100%) recovery in the event of a payment default. S&P also assigned a 'CCC+' issue-level rating to the company's unsecured notes. The recovery rating is '6', indicating expectations for negligible recovery (0%-10%) recovery in the event of a payment default. "The ratings on BioScrip reflect its "highly leveraged" financial risk profile and "weak" business risk profile following the company's plans to issue $200 million unsecured notes and divest its non-core home health business to reduce the outstanding balance on its revolver and term loan B," said credit analyst Tahira Wright. "Our assessment of BioScrip's financial risk profile reflects our expectation of negative free cash flow generation of more than $50 million in 2013, its acquisitive past, and high leverage. Pro forma for the debt offering and sale of its home health business, we expect leverage to remain above 6.0x through 2014. The weak business risk profile reflects the company's narrow business focus in the infusion services market." S&P's negative rating outlook on BioScrip reflects its lower expectations of cash flow generation in 2014, following a free cash flow deficit in excess of $50 million in 2013, along with considerable headwinds that could prevent the sharp turnaround. Upside Scenario S&P would consider revising the outlook back to stable once the company can demonstrate the ability to generate free operating cash flow over a sustained period. Key factors that S&P will monitor include managing working capital investment and realization of cost reduction initiatives. Downward Scenario A lower rating would likely occur if S&P believes its base case will not be met, and the company continues to be free cash flow negative in 2014. This could occur if the company continues to face working capital challenges because of recent acquisitions and/or continues its aggressive growth strategy. This would likely result in considerable borrowings on its revolver, limiting available liquidity, and increased possibility of tightening covenant cushions. BISHOP OF STOCKTON: Amends List of Top Unsecured Creditors ---------------------------------------------------------- The Roman Catholic Bishop of Stockton filed an amended list disclosing the following creditors holding largest unsecured claims: Entity Nature of Claim Claim Amount ------ --------------- ------------ Farmers and Merchants Bank Unsecured Loan and $1,656,921 Contingent Guaranties Tyler McCartney Settled Tort Litigation $500,000 Madonna of Peace Unsecured note $100,000 Retreat Center Pastor of Saint Fractional interest in $36,568 Bernadette Church Dec. 2010 loan Pastor of St Anthony Fractional interest in $36,568 Church of Manteca Dec. 2010 loan Kathleen Lagorio Janssen Fractional interest in $29,254 Trustee of the K.L. Janssen Dec. 2010 loan Community Property Living Trust and Dean Jann Janssen Trustee of the Dean J. Janssen Living Trust Pastor of St. Joachim Fractional interest in $25,598 Church of Lockeford Dec. 2010 loan Diocese of Kumbakonam Restricted funds $20,676 collected in 2013 for the Kumbakonam Diocese Erika L. and Edwin F. Rizo Fractional interest in $18,284 Revocable Trust Dec. 2010 loan Jose Domingo Ruiz Retirement benefits $18,000 for Extern Priest Fr. Jose Ruiz held in constructive trust by the Stockton diocese Jairo Ramirez Retirement benefits $18,000 for Extern Priest Fr. Jairo Ramirez held in constructive trust by the Stockton diocese Edwin Musico Retirement benefits $18,000 for Extern Priest Fr. Edwin Musico held in constructive trust by the Stockton diocese Joe Maghinay Retirement benefits $18,000 for Extern Priest Joe Maghinay held in constructive trust by the Stockton diocese Dante Dammay Retirement benefits $17,999 for Extern Priest Dante Dammay held in constructive trust by the Stockton diocese Sweeney Greene & Roberts LLP Legal services December $17,165 2013 to January 2014 Editho Mascardo Retirement benefits $17,000 for Extern Priest Editho Mascardo held in constructive trust by the Stockton diocese Augustin Gialogo Retirement benefits $16,000 for Extern Priest Augustin Gialogo held in constructive trust by the Stockton diocese Gemperle Brothers Fractional interest in $14,627 Dec. 2010 loan Financial Decision 401-K Fractional interest in $14,627 Profit Sharing Plan Dec. 2010 loan FBO Fred Lee Financial Decision 401-K Fractional interest in $14,627 Profit Sharing Plan FBO Dec. 2010 loan Nancy Lee Lenore Dougherty Fractional interest in $14,627 Trustee of the Dougherty Dec. 2010 loan Revocable Trust Pastor of Cathedral of Fractional interest in $14,627 the Annunciation Dec. 2010 loan Alvaro Lopez Retirement benefits $14,000 for Extern Priest Alvaro Lopez held in constructive trust by the Stockton diocese Eduardo Perez Retirement benefits $13,667 for Extern Priest Eduardo Perez held in constructive trust by the Stockton diocese Bonifacio Baldonado Retirement benefits $10,333 for Extern Priest Bonifacio Baldonado held in constructive trust by the Stockton diocese Jorge Roman Retirement benefits $9,499 for Extern Priest Jorge Roman held in constructive trust by the Stockton diocese John CC Doe Pending Tort Litigation Unknown Jane Doe 51 Pending Tort Litigation Unknown John BE Doe Pending Tort Litigation Unknown John MT Doe Pending Tort Litigation Unknown About Diocese of Stockton The Diocese of Stockton, California was established on Feb. 21, 1962, by Pope John XXIII from the territory formerly located in the Archdiocese of San Francisco and the Diocese of Sacramento. The Diocese, comprising the six counties of San Joaquin, Stanislaus, Calaveras, Tuolumne, Alpine, and Mono, currently serves approximately 250,000 Catholics in 35 parishes. As a religious organization, The Roman Catholic Bishop of Stockton ("RCB") has no significant ongoing for-profit business activities. Revenue for the RCB principally comes from the annual ministry appeal, fees for services provided to non-RCB entities, donations, grants, and RCB ministry revenue. When the Diocese was created, most, if not all, of the property of the Parishes (excluding the pre- and/or elementary (K-8) schools) was held in the name of the RCB. The RCB also held the property for the cemeteries in the Diocese as well as some of the real property to be used for future parishes. Several Roman Catholic dioceses in the U.S. have filed for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. In Stockton's case, the RCB filed a Chapter 11 bankruptcy petition (Bankr. E.D. Cal. Case No. 14-20371) in Sacramento on Jan. 15, 2014. Judge Christopher M. Klein oversees the case. Attorneys at Felderstein Fitzgerald Willoughby & Pascuzzi LLP serve as counsel to the Debtor. The Debtor estimated assets of $1 million to $10 million and debt of $10 million to $50 million. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) BISHOP OF STOCKTON: Judge Zive Appointed as Mediator ---------------------------------------------------- Judge Christopher Klein of U.S. Bankruptcy Court for the Eastern District of California on Feb. 3 appointed Judge Gregg Zive as judicial mediator in the Chapter 11 case of the Roman Catholic Bishop of Stockton. Mr. Zive, a bankruptcy judge in Nevada, will also serve as judicial mediator in all adversary cases filed by or against the diocese. In connection with his appointment, Mr. Zive was authorized to issue any order or statement to parties involved in mediations, setting forth requirements he may impose for the conduct of mediation sessions. The appointment followed a decision handed down by the chief judge of the Court of Appeals that authorized Mr. Zive to serve temporarily in the Eastern District of California. About Diocese of Stockton The Diocese of Stockton, California was established on Feb. 21, 1962, by Pope John XXIII from the territory formerly located in the Archdiocese of San Francisco and the Diocese of Sacramento. The Diocese, comprising the six counties of San Joaquin, Stanislaus, Calaveras, Tuolumne, Alpine, and Mono, currently serves approximately 250,000 Catholics in 35 parishes. As a religious organization, The Roman Catholic Bishop of Stockton ("RCB") has no significant ongoing for-profit business activities. Revenue for the RCB principally comes from the annual ministry appeal, fees for services provided to non-RCB entities, donations, grants, and RCB ministry revenue. When the Diocese was created, most, if not all, of the property of the Parishes (excluding the pre- and/or elementary (K-8) schools) was held in the name of the RCB. The RCB also held the property for the cemeteries in the Diocese as well as some of the real property to be used for future parishes. Several Roman Catholic dioceses in the U.S. have filed for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. In Stockton's case, the RCB filed a Chapter 11 bankruptcy petition (Bankr. E.D. Cal. Case No. 14-20371) in Sacramento on Jan. 15, 2014. Judge Christopher M. Klein oversees the case. Attorneys at Felderstein Fitzgerald Willoughby & Pascuzzi LLP serve as counsel to the Debtor. The Debtor estimated assets of $1 million to $10 million and debt of $10 million to $50 million. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) BISHOP OF STOCKTON: Felderstein Firm to Comply With UST Guidelines ------------------------------------------------------------------ Paul Pascuzzi, Esq., at Felderstein Fitzgerald Willoughby & Pascuzzi LLP, filed a supplemental declaration to address the concerns of the U.S. Trustee regarding the application of the Stockton diocese to hire the firm as its legal counsel. Mr. Pascuzzi said in the filing that his firm will comply with the U.S. Trustee's guidelines in seeking compensation and expense reimbursement from the diocese. In case Felderstein increases the rates for its services, the firm will file a supplemental affidavit describing those increases, and will notify the U.S. Trustee as well as the unsecured creditors' committee, according to Mr. Pascuzzi. About Diocese of Stockton The Diocese of Stockton, California was established on Feb. 21, 1962, by Pope John XXIII from the territory formerly located in the Archdiocese of San Francisco and the Diocese of Sacramento. The Diocese, comprising the six counties of San Joaquin, Stanislaus, Calaveras, Tuolumne, Alpine, and Mono, currently serves approximately 250,000 Catholics in 35 parishes. As a religious organization, The Roman Catholic Bishop of Stockton ("RCB") has no significant ongoing for-profit business activities. Revenue for the RCB principally comes from the annual ministry appeal, fees for services provided to non-RCB entities, donations, grants, and RCB ministry revenue. When the Diocese was created, most, if not all, of the property of the Parishes (excluding the pre- and/or elementary (K-8) schools) was held in the name of the RCB. The RCB also held the property for the cemeteries in the Diocese as well as some of the real property to be used for future parishes. Several Roman Catholic dioceses in the U.S. have filed for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. In Stockton's case, the RCB filed a Chapter 11 bankruptcy petition (Bankr. E.D. Cal. Case No. 14-20371) in Sacramento on Jan. 15, 2014. Judge Christopher M. Klein oversees the case. Attorneys at Felderstein Fitzgerald Willoughby & Pascuzzi LLP serve as counsel to the Debtor. The Debtor estimated assets of $1 million to $10 million and debt of $10 million to $50 million. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) BISHOP OF STOCKTON: Proposes Neumiller as Special Counsel --------------------------------------------------------- The Roman Catholic Bishop of Stockton asked Judge Christopher Klein for approval to hire Neumiller & Beardslee as its special counsel. Neumiller will represent the diocese in lawsuits, including defending the diocese against allegations of child sex abuse. It will also provide legal advice on insurance-related issues and will assist the diocese's lead legal counsel in the course of its restructuring. Neumiller has agreed to be paid for its services at discounted hourly rates, and will receive reimbursement for work-related expenses. The lawyers who are expected to represent the diocese are: Discounted Standard Professionals Title Hourly Rates Hourly Rates ------------- ----- ------------ ------------ Clifford Stevens Principal $230 $325 Email: cstevens@neumiller.com Saroya Leonardini Principal $230 $315 Email: sleonardini@neumiller.com Paul Balestracci Principal $230 $335 Email: pbalestracci@neumiller.com Daniel Truax Principal $230 $325 Email: dtruax@neumiller.com Lisa Jimenez Principal $230 $295 Email: ljimenez@neumiller.com Michael Tener Associate $230 $265 Email: mtener@neumiller.com Melissa Giannecchini Associate $230 $250 Email: mvanruiten@neumiller.com Christopher Greene Of counsel $230 $335 Email: cgreene@neumiller.com The firm doesn't hold or represent interest adverse to the diocese, and is not a creditor, equity security holder or an insider of the diocese, according to a declaration by Clifford Stevens, Esq., at Neumiller & Beardslee. About Diocese of Stockton The Diocese of Stockton, California was established on Feb. 21, 1962, by Pope John XXIII from the territory formerly located in the Archdiocese of San Francisco and the Diocese of Sacramento. The Diocese, comprising the six counties of San Joaquin, Stanislaus, Calaveras, Tuolumne, Alpine, and Mono, currently serves approximately 250,000 Catholics in 35 parishes. As a religious organization, The Roman Catholic Bishop of Stockton ("RCB") has no significant ongoing for-profit business activities. Revenue for the RCB principally comes from the annual ministry appeal, fees for services provided to non-RCB entities, donations, grants, and RCB ministry revenue. When the Diocese was created, most, if not all, of the property of the Parishes (excluding the pre- and/or elementary (K-8) schools) was held in the name of the RCB. The RCB also held the property for the cemeteries in the Diocese as well as some of the real property to be used for future parishes. Several Roman Catholic dioceses in the U.S. have filed for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. In Stockton's case, the RCB filed a Chapter 11 bankruptcy petition (Bankr. E.D. Cal. Case No. 14-20371) in Sacramento on Jan. 15, 2014. Judge Christopher M. Klein oversees the case. Attorneys at Felderstein Fitzgerald Willoughby & Pascuzzi LLP serve as counsel to the Debtor. The Debtor estimated assets of $1 million to $10 million and debt of $10 million to $50 million. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) C&K MARKET: Files Ch. 11 Plan, Offers Stock to Creditors -------------------------------------------------------- C&K Market, Inc., filed with the U.S. Bankruptcy Court for the District Oregon a Chapter 11 plan and accompanying disclosure statement, which provide that each holder of an allowed general unsecured claim will receive one share of common stock of the reorganized debtor in exchange for each $10 of the holder's allowed general unsecured claim and a subscription right in the event the Debtor elects to consummate a rights offering. The Plan, dated Jan. 31, 2014, also provides for the payment in full on the Effective Date of all Allowed Administrative Expense Claims, Priority Tax Claims, Other Priority Claims and the Allowed Secured Claim of U.S. Bank. The Plan provides for the payment in full over time, with interest, of all other Secured Claims. In general, Secured Creditors with personal property collateral will be paid in 60 equal amortizing payments, with interest at 5%, and Secured Creditors with real property collateral will be paid in 84 equal amortizing payments with interest at 5% based on a 25-year amortization with a balloon payment in seven years. The Plan provides that each holder of a Small Unsecured Claim ($10,000 or less) will receive, within 90 days after the Effective Date, a cash payment in an amount equal to 80% of its Allowed Small Unsecured Claim. The Plan provides that all existing Equity Securities and Employee Equity Security Plans will be cancelled as of the Effective Date. The Plan and Disclosure Statement were filed by Albert N. Kennedy, Esq., Timothy J. Conway, Esq., Michael W. Fletcher, Esq., and Ava L. Schoen, Esq., at Tonkon Torp LLP, in Portland, Oregon, on behalf of the Debtor. A full-text copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/C&KMARKETds0131.pdf About C&K Market C&K Market Inc., a 57 year-old grocery store chain, sought bankruptcy protection from creditors with a plan to sell or close some of its stores, on Nov. 19, 2013 (Bankr. D. Ore. Case No. 13-64561). The case is assigned to Judge Frank R. Alley, III. C&K Market scheduled $157,696,921 in total assets and $101,604,234 in total liabilities. The Debtors are represented by Albert N. Kennedy, Esq., Timothy J. Conway, Esq., Michael W. Fletcher, Esq., and Ava L. Schoen, Esq., at Tonkon Torp LLP, in Portland, Oregon. Edward Hostmann has been tapped as chief restructuring officer, and The Food Partners, LLC, serves as the Debtors' financial advisor. The Debtors hired Great American Group, LLC, to conduct store closing sales. An Official Committee of Unsecured Creditors appointed in the Debtors' cases has retained Scott L. Hazan, Esq., David M. Posner, Esq., and Jenette A. Barrow-Bosshart, Esq., at Otterbourg P.C. as lead co-counsel, and Tara J. Schleicher, Esq., at Farleigh Wada Witt as local co-counsel; and Protiviti, Inc. as financial consultant. CENGAGE LEARNING: Revises Plan to Incorporate Global Settlement --------------------------------------------------------------- Cengage Learning, Inc., et al., revised their Joint Plan of Reorganization to incorporate a global settlement they entered into with "supporting parties," which include the: (i) Consenting Credit Agreement Lenders; (ii) Consenting First Lien Agent; (iii) Consenting First Lien Noteholders; (iv) Committee; (v) Consenting Second Lien Note Holders; (vi) Consenting Second Lien Trustee; (vii) Consenting Centerbridge Lenders; (viii) Consenting Apax Parties; (ix) Consenting Senior Unsecured Notes Trustee; and (x) Consenting PIK Notes Trustee. The Debtors also asked the U.S. Bankruptcy Court for the Eastern District of New York to approve the global settlement memorialized in a plan support agreement. The Global PSA, which is the result of numerous mediation sessions with the Honorable Judge Robert D. Drain and extensive good faith, arm's-length negotiations with the supporting parties, which are the major stakeholders on the terms of the Chapter 11 Plan. The Global PSA provides that it may be terminated if the Debtors fail to obtain Court approval of the Global PSA and the Disclosure Statement Supplement on or before Feb. 21, 2014, (c) confirm the Amended Plan on or before March 14, 2014, or (d) consummate the Amended Plan on or before March 31, 2014. The most significant modifications reflected in the Plan Term Sheet and Amended Plan are as follows: * Unsecured Creditor Distribution. Unsecured creditors -- including Holders of Allowed Second Lien Claims, Allowed Senior Notes Claims and Allowed General Unsecured Claims -- will receive the following in full and final satisfaction of their Claims: (1) New Equity in the aggregate amount of $225 million, (2) the first $12 million of Cash distributions that Apax Partners LP would be entitled to in its capacity as a Holder of Allowed Second Lien Claims and Allowed Senior Notes Claims, will be withheld from Apax and instead distributed to all non-Apax Holders of Allowed Second Lien Claims, Allowed Senior Notes Claims, Allowed General Unsecured Claims, and Allowed PIK Notes Claims. * The Other Unsecured Creditor Distribution will be allocated as follows: (a) 62.5% of the Other Unsecured Creditor Distribution will be distributed to the Holders of Second Lien Claims, including Apax; provided that the portion of the Second Lien Distribution consisting solely of the Withheld Apax Distribution will be shared Pro Rata amongst Holders of Second Lien Claims other than Apax; (b) (i) 37.5% of the Other Unsecured Creditor Distribution will be distributed to Holders of Senior Notes Claims, General Unsecured Claims, and Holders of PIK Notes Claims, pursuant to the terms of the Amended Plan; provided, among other things, that to the extent that recoveries to Holders of Allowed General Unsecured Claims against CLAI would exceed 7.2%. * PIK Notes Distribution. In full and final satisfaction of their Claims, Holders of PIK Notes Claims, will receive (1) to the extent that the Class of Holders of PIK Notes Claims votes to accept the Plan and the PIK Notes Indenture Trustee does not take any action on or after the PIK Settlement Date in the Chapter 11 Cases that is inconsistent with the Amended Plan or any agreements under the Plan Support Agreement, receive, on the Effective Date, its share of the PIK Notes Settlement Recovery Amount. * First Lien Claims Distribution. In full and final satisfaction of their Claims, Holders of First Lien Claims, including Apax, will receive (1) 100% of the New Equity, reduced by the New Equity distributed in the Other Unsecured Creditor Distribution, and subject to dilution by the Management Incentive Plan, (2) the New Debt Facility Consideration and (3) the Distributable Cash. * Apax Claims. The First Lien Claims, the Second Lien Claims, the Senior Notes Claims, and the Subordinated Notes Claims held by Apax and the Apax Fees will be permanently Allowed under the Amended Plan and not subject to challenge, reduction, recharacterization, defense, offset, or counterclaims. * Shareholder Agreement. The Shareholders Agreement and the other New Corporate Governance Documents will be reasonably acceptable to the "Required Consenting Lenders" and will not unreasonably and adversely affect any Holder of New Equity in the exercise of its rights as a Holder of New Equity. The Shareholders Agreement will expressly identify Apax as the "15%" holder entitled to nominate and have elected one director and one board observer on the Effective Date, so long as Apax is entitled to at least 15% of the New Equity on account of its First Lien Claims as of the Effective Date. * Professional Fees. The Amended Plan will provide for the payment in full by the Debtors of all the reasonable and documented fees and expenses incurred in connection with the Chapter 11 cases by the Second Lien Indenture Trustee, the Consenting Second Lien Holders, the Senior Notes Indenture Trustee, the PIK Notes Indenture Trustee, and Centerbridge, collectively up to an amount of $20 million in the aggregate. The Amended Plan will also provide for the payment to Apax of $8 million in Cash in respect of its Claim for accrued fees and expenses in full and final satisfaction of all of Apax's Claims against the Debtors for accrued fees and expenses. Bill Rochelle, the bankruptcy columnist for Bloomberg News, pointed out that the stock distribution contemplated under the Plan will be based on a $3.6 billion enterprise value for the reorganized company. The emerging company will be financed with a new loan of $1.75 billion to $2 billion, including a $250 million revolving credit not intended to be drawn initially, Mr. Rochelle said. The revised plan is supported by a "super majority" of the affected creditor groups, Mr. Rochelle added, citing a company statement. In line with the revised Plan, the Debtors propose the following deadlines with respect to solicitation and confirmation of the Amended Plan: * February 7, 2014: Date for determining: (i) the Holders of Claims entitled to receive Supplemental Solicitation Packages; (ii) the Holders of Claims entitled to vote to accept or reject the Amended Plan; and (iii) whether Claims have been properly transferred to an assignee so that the assignee entitled to receive a Supplemental Solicitation Package can vote as the Holder of the Claim * February 13, 2014: Deadline to complete distribution of Supplemental Solicitation Packages * February 14, 2014: Deadline to distribute and publish Confirmation Hearing notice * February 23, 2014: Deadline to file Plan Supplement * March 10, 2014 at 4:00 p.m. (EDT): Deadline to file objections to confirmation of the Amended Plan * March 10, 2014 at 4:00 p.m. (EDT): Deadline to submit ballots voting for or against the Amended Plan * March 12, 2014 at 4:00 p.m. (EDT): Deadline to reply to objections to the Amended Plan * March 12, 2014: Deadline to file voting certification * March 13, 2014 at 8:30 a.m. (EDT): Hearing on confirmation of the Amended Plan The Debtors also propose that a hearing on the global PSA be scheduled for February 12, 2014 at 8:30 a.m. (ET). A blacklined version of the Amended Plan, dated Feb. 7, 2014, is available at http://bankrupt.com/misc/CENGAGEplan0207.pdf The Amended Plan was filed by Jonathan S. Henes, Esq., Christopher J. Marcus, Esq., and Christopher T. Greco, Esq., at KIRKLAND & ELLIS LLP, in New York; and James H.M. Sprayregen, Esq., and Ross M. Kwasteniet, Esq., in KIRKLAND & ELLIS LLP, in Chicago, Illinois, on behalf of the Debtors. 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. CENTRAL COVENTRY FIRE DISTRICT: Final Decision on Future Soon ------------------------------------------------------------- Lauren Costa at the Coventry Patch reports that during the latest Central Coventry Fire District hearing, Superior Court Judge Brian P. Stern made it abundantly clear that a final decision regarding the district's uncertain future must be made . . . . and soon. Updates from both Special Master Rick Land and Fire Chief Andy Baynes shed light on the foundering fire district's current status in regards to equipment, personnel and finances -- all of which were deemed concerning by Judge Stern, the report notes. Chief Baynes said the status of the district's equipment is "marginal" and "not very reliable", citing the fact that both the district's reserve fire engine and rescue are currently out of service for repair as just one example, the report relays. When asked about the district's contingency plan in the event that equipment breaks down, Mr. Baynes admitted that borrowing from neighboring districts is common practice, but CCFD's near inability to reciprocate, combined with budget cuts statewide, make the situation even more difficult, the report discloses. Mr. Baynes also summarized his staffing concerns, saying that by June, when four CCFD members become eligible to retire, the company could be brought down to 32 uniformed employees - down from 45 in October 2012, the report relates. The report notes that Special Master Land presented Judge Stern with a summary of the district's finances, stating the district currently has $1.48 million in the bank collected through tax payments and rescue run recovery funds. He estimated that the district's weekly expenses average approximately $100,000 per week, which includes salaries, benefits and vehicle repairs, among other weekly necessities, the report relates. When considering CCFD's various outstanding debts including US$300,000 to the Town of Coventry and a minimum of $263,000 to Kent County Water Authority, Land stated that the district "certainly owes north of $1.5 million," the report notes. The report says that on behalf of the district's Board of Directors, Attorney Dave D'Agostino gave testimony highlighting the board's most recent plans to cut costs and streamline CCFD's financial books and records. The report relates that board members wish to discuss with Town officials the proposed implementation of a town-wide street lighting plan as Central Coventry taxpayers foot the bill for a large portion of the town's street lights. Mr. D'Agostino also shared the board's consideration of a fee-per-call style of emergency service as a cost-saving measure. Despite the Board of Directors update, Judge Stern voiced his concern that he has not seen enough progress since the board was elected and charged with determining a contingency plan for the district, the report adds. Coventry, Rhode Island's central fire department district filed for receivership in October 2012, after taxpayers voted down the department's proposed budget in a meeting. The fire department is $1.6 million in the red and has failed to keep up payments for health insurance to Blue Cross and Blue Shield of Rhode Island. The department has 52 firefighters to cover 26 square miles of Coventry. CHARTER COMMS: To Nominate Full Slate for Time Warner Cable Board ----------------------------------------------------------------- Shalini Ramachandran, Martin Peers and Liz Hoffman, writing for The Wall Street Journal, reported that Charter Communications Inc. plans this week to nominate a full slate of candidates for Time Warner Cable Inc.'s 13-member board, say people familiar with the situation, setting in motion one of the biggest recent hostile takeover bids. According to the report, Charter isn't likely to raise its offer for TWC at the same time as putting forward the slate, the people said, despite expectations among some investors of such a move. Instead Charter is likely to wait a few weeks until later in the proxy fight campaign before bumping the price, one of the people said. Meanwhile it would likely continue trying to negotiate a deal privately. Charter, the fourth largest cable operator by subscribers, has been attempting to bring Time Warner Cable, the second biggest cable company, to the negotiating table for a merger deal since late last spring, the report related. It has made three offers so far, the most recent at $132.50 a share, each rejected by TWC as being too low. Time Warner Cable has said it wants a price of $160 a share and won't negotiate with Charter otherwise. All 13 of Time Warner Cable's board members are up for re-election at the annual meeting this spring, presenting Charter with a rare opportunity among recent hostile bidders, to take control of the board, the report further related. Other hostile bids have been hampered by staggered boards, in which only one-third of seats open up each year. Men's Wearhouse Inc., for example, has said it plans to nominate two directors at Jos. A. Bank Clothiers Inc., hoping to press a $1.6 billion takeover bid. But a win would be largely symbolic. Because Jos. A. Bank's board is staggered, Men's Wearhouse would have to win a second vote in 2015 to take control. A central point of Charter's proxy campaign will be that its candidates would, if elected to TWC's board, make a priority of evaluating Charter's offer, the report pointed out. A vote for Charter's candidates, one of the people said, would therefore be a vote for TWC to engage with Charter. The identities of Charter's nominees couldn't be learned; the deadline for nominations is Feb. 15. Based in St. Louis, Missouri, Charter Communications, Inc. (Pink OTC: CHTRQ) -- http://www.charter.com/-- is a broadband communications company and the fourth-largest cable operator in the United States. Charter provides a full range of advanced broadband services, including advanced Charter Digital Cable(R) video entertainment programming, Charter High-Speed(R) Internet access, and Charter Telephone(R). Charter Business(TM) similarly provides scalable, tailored, and cost-effective broadband communications solutions to business organizations, such as business-to-business Internet access, data networking, video and music entertainment services, and business telephone. Charter's advertising sales and production services are sold under the Charter Media(R) brand. Charter Communications and more than a hundred affiliates filed voluntary Chapter 11 petitions on March 27, 2009 (Bankr. S.D.N.Y. Case No. 09-11435). As of March 31, 2009, the Debtors had total assets of $13,650,000,000, and total liabilities of $24,501,000,000. Pacific Microwave filed for bankruptcy April 20, 2009, disclosing assets of not more than $50,000 and debts of more than $1 billion. The Hon. James M. Peck presided over the cases. Richard M. Cieri, Esq., Paul M. Basta, Esq., and Stephen E. Hessler, Esq., at Kirkland & Ellis LLP, in New York, served as counsel to the Debtors, excluding Charter Investment Inc. Albert Togut, Esq., at Togut, Segal & Segal LLP in New York, served as Charter Investment, Inc.'s bankruptcy counsel. Curtis, Mallet-Prevost, Colt & Mosel LLP, in New York, was the Debtors' conflicts counsel. Ernst & Young LLP was the Debtors' tax advisors. KPMG LLP was the Debtors' independent auditor. The Debtors' valuation consultants were Duff & Phelps LLC; the Debtors' financial advisors were Lazard Freres & Co. LLC; and the Debtors' restructuring consultants were AlixPartners LLC. The Debtors' regulatory counsel was Davis Wright Tremaine LLP, and Friend Hudak & Harris LLP. The Debtors' claims agent was Kurtzman Carson Consultants LLC. Judge James M. Peck of the U.S. Bankruptcy Court for the Southern District of New York approved the Debtors' pre-arranged joint plan of reorganization in a bench ruling on Oct. 15, 2009. On Nov. 30, 2009, Charter Communications, Inc., announced that it has successfully completed its financial restructuring, which significantly improves the Company's capital structure by reducing debt by approximately 40 percent, or approximately $8 billion. Charter Communications, Inc., has emerged from Chapter 11 under its pre-arranged Joint Plan of Reorganization, which was confirmed by the United States Bankruptcy Court for the Southern District of New York on Nov. 17, 2009. CHESAPEAKE ENERGY: S&P Revises Outlook to Pos. & Affirms 'BB-' CCR ------------------------------------------------------------------ Standard & Poor's Ratings Services said it revised its rating outlook on Oklahoma City-based Chesapeake Energy Corp. to positive from stable. S&P affirmed its 'BB-' corporate credit rating on the company. S&P also affirmed the 'BB-' issue-level rating on Chesapeake's senior unsecured notes; the recovery rating on these notes is '3', which indicates S&P's expectation of meaningful (50% to 70%) recovery in the event of a payment default. The ratings on Chesapeake Energy Corp., which is one of the largest independent oil and gas exploration and production (E&P) companies in the world, reflect Standard & Poor's assessment of the company's business risk profile as "satisfactory". In addition, S&P views the company's financial risk profile as "aggressive." Chesapeake is the second largest producer of natural gas in the U.S. (behind ExxonMobil Corp.) and is also among the 15 largest producers of liquids (oil and natural gas liquids). The company has among the largest U.S. onshore leasehold positions of any E&P company, and it has been the leading driller of horizontal shale wells globally. "The rating could be raised within the next year if we came to expect that debt reduction through asset sales would be sufficient for the company to sustain debt to EBITDA of less than 3x," said Standard & Poor's credit analyst Scott Sprinzen. "Based on our current expectations for oil and gas prices and Chesapeake's production levels and operating costs, this likely would entail debt reduction of at least several billion dollars. The rating could also be raised if Chesapeake demonstrated further progress in improving its operating efficiency, overcoming legacy commitments to third parties." On the other hand, S&P could revise the outlook to stable if it came to expect that significant de-leveraging is not forthcoming, given some combination of a failure to complete asset sales, operating setbacks, or a growth strategy that was more aggressive than S&P now anticipates. CHINA NATURAL GAS: Honest Best, Yong Hui Li Disclose Stake ---------------------------------------------------------- In a Schedule 13G filing with the U.S. Securities and Exchange Commission, Honest Best Int'l Ltd. and Yong Hui Li, both based in Shijiazhuang, Hebei, in China, disclosed ownership of shares of China Natural Gas Inc. Common Stock, $0.0001 par value. Honest Best Int'l Ltd. disclosed beneficial ownership of 2,440,437 shares, representing 11.4% of the Company's common stock. Yong Hui Li disclosed beneficial ownership of 2,660,437 shares, representing 12.4% of the Company's common stock. Honest Best Int'l Ltd. is a British Virgin Islands company. Yong Hui Li is a citizen of Canada. About China Natural Gas Headquartered in Xi'an, Shaanxi Province, P.R.C., China Natural Gas, Inc., was incorporated in the State of Delaware on March 31, 1999. The Company through its wholly owned subsidiaries and variable interest entity, Xi'an Xilan Natural Gas Co., Ltd., and subsidiaries of its VIE, which are located in Hong Kong, Shaanxi Province, Henan Province and Hubei Province in the People's Republic of China ("PRC"), engages in sales and distribution of natural gas and gasoline to commercial, industrial and residential customers through fueling stations and pipelines, construction of pipeline networks, installation of natural gas fittings and parts for end-users, and conversions of gasoline-fueled vehicles to hybrid (natural gas/gasoline) powered vehicles at 0ptmobile conversion sites. On Feb. 8, 2013, an involuntary petition for bankruptcy was filed against the Company by three of the Company's creditors, Abax Lotus Ltd., Abax Nai Xin A Ltd., and Lake Street Fund LP (Bankr. S.D.N.Y. Case No. 13-10419). The Petitioners claimed that they have debts totaling $42,218,956.88 as a result of the Company's failure to make payments on the 5% Guaranteed Senior Notes issued in 2008. Adam P. Strochak, Esq., at Weil, Gotshal & Manges, LLP, in Washington, D.C., represents the Petitioners as counsel. China Natural Gas, Inc., sought dismissal of the involuntary petition but in July 2013, it consented to the entry of an order for relief under Chapter 11 of the U.S. Code. China Natural Gas, Inc. obtained approval from the Court to employ Warren Street Global, Inc. and to designate J. Gregg Pritchard as Chief Restructuring Officer, nunc pro tunc as of Aug. 28, 2013. It hired Schiff Hardin led by Louis T. DeLucia, Esq., as counsel. In November, China Natural Gas Inc. said it has prepared a draft creditor-payment plan and has a deal with a potential buyer interested in some of its Chinese assets. The Company's balance sheet at Sept. 30, 2013, showed $307.5 million in total assets, $87.71 million in total liabilities, and stockholders' equity of $219.78 million. CHINA NATURAL: Hearing on Plan Filing Extension Set for Feb. 25 --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York will hold a hearing on Feb. 25, 2014, at 11:00 a.m. (ET) to consider China Natural Gas, Inc.'s motion for entry of an order further extending the periods during which the Debtor has the exclusive right to file a Chapter 11 plan by an additional 90 days, through and including May 5, 2014, and during which the Debtor has exclusive right to solicit acceptances of that plan, through and including July 7, 2014. As reported by the Troubled Company Reporter on Nov. 22, 2013, BankruptcyData reported that the Court previously extended, at the behest of the Debtor, the exclusive period during which the Debtor can file a plan and solicit acceptances thereof through and including Feb. 4, 2014 and April 7, 2014, respectively. The Debtor and its largest alleged creditor, the Abax Entities, entered into and filed a protocol agreement, pursuant to which the parties agreed to collaborate to explore the interests of any third parties in a restructuring transaction, sharing expressions of interest, creating a "Working Group" that would meet or confer every week on developments and possible interested parties in a restructuring transaction. The Debtor said in a filing dated Feb. 3, 2014, that although it is working to attract and identify interested parties willing to either invest in the Debtor or to acquire assets of the Debtor in the People's Republic of China, and has shared the identity of at least three such parties with the Abax Entities, the Debtor and its advisors need additional time to negotiate, document and file any acceptable transaction. The Debtor is focused on implementing a restructuring that maximizes value for all stakeholders. To that end, since the Petition Date, the Debtor has taken a number of critical steps to promote its restructuring, including, among other things, (i) seeking and obtaining court approval of a critical SEC settlement of pre-bankruptcy alleged securities violations; (ii) identifying and retaining the CRO; and (iii) participating in discussions and exchanging debt repayment proposals with its principal creditors. In addition, the Debtor has worked with its attorneys defending certain security class actions, Shearman & Sterling LLP, to bring those matters to a conclusion that will facilitate any restructuring, and will address the potential treatment of claimants under a plan. On Jan. 31, 2014, the bankruptcy case was reassigned to Judge Sean H. Lane for administration. About China Natural Headquartered in Xi'an, Shaanxi Province, P.R.C., China Natural Gas, Inc., was incorporated in the State of Delaware on March 31, 1999. The Company through its wholly owned subsidiaries and variable interest entity, Xi'an Xilan Natural Gas Co., Ltd., and subsidiaries of its VIE, which are located in Hong Kong, Shaanxi Province, Henan Province and Hubei Province in the People's Republic of China ("PRC"), engages in sales and distribution of natural gas and gasoline to commercial, industrial and residential customers through fueling stations and pipelines, construction of pipeline networks, installation of natural gas fittings and parts for end-users, and conversions of gasoline-fueled vehicles to hybrid (natural gas/gasoline) powered vehicles at 0ptmobile conversion sites. On Feb. 8, 2013, an involuntary petition for bankruptcy was filed against the Company by three of the Company's creditors, Abax Lotus Ltd., Abax Nai Xin A Ltd., and Lake Street Fund LP (Bankr. S.D.N.Y. Case No. 13-10419). The Petitioners claimed that they have debts totaling $42,218,956.88 as a result of the Company's failure to make payments on the 5% Guaranteed Senior Notes issued in 2008. Adam P. Strochak, Esq., at Weil, Gotshal & Manges, LLP, in Washington, D.C., represents the Petitioners as counsel. China Natural Gas, Inc., sought dismissal of the involuntary petition but in July 2013, it consented to the entry of an order for relief under Chapter 11 of the U.S. Code. The last regulatory filing listed assets as of June 30 of $29.5 million and liabilities totaling $82.5 million. COLLEGE WAY: Court Approves Hiring of Iwama Law as Counsel ---------------------------------------------------------- College Way Commercial Plaza, LLC sought and obtained authorization from the Hon. Brian D. Lynch of the U.S. Bankruptcy Court for the Western District of Washington at Tacoma to employ Masafumi Iwama, Esq., and Iwama Law Firm as Chapter 11 counsel. The Debtor requires Iwama Law to: (a) take all actions necessary to protect and preserve Debtor's bankruptcy estate, including the prosecution of actions on the Debtor's behalf. To undertake, in conjunction as appropriate with special litigation counsel, the defense of any action commenced against the Debtor, negotiations concerning litigation in which the Debtor is involved, objections to claims filed against the Debtor in this bankruptcy case, and the compromise or settlement of claims; (b) prepare the necessary applications, motions, memoranda, responses, complaints, answers, orders, notices, reports and other papers required from the Debtor as debtors- in-possession in connection with administration of this case; and (c) negotiate with creditors concerning a Chapter 11 plan, to prepare a Chapter 11 plan and disclosure statement and related documents, and to take the steps necessary to confirm and implement the proposed plan. Iwama Law will be paid at these hourly rates: Attorney $300 Senior Paralegal $135 Legal Secretary $60 Iwama Law will also be reimbursed for reasonable out-of-pocket expenses incurred. Masafumi Iwama has been paid during the one year period prior to filing, fees of $1,213 as the filing fee. Masafumi Iwama received $8,787 for this Chapter 11 case prior to filing. Iwama Law has received a total of $10,000.00 pre-petition and there is no remaining balance in the client trust account. The filing fee has been paid to Masafumi Iwama and it was paid from the Client Trust Account at the time of filing Masafumi Iwama 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. Iwama Law can be reached at: Masafumi Iwama, Esq. IWAMA LAW FIRM 333 5th Ave. S. Kent, WA 98032 Tel: (253) 520-7671 Fax: (253) 520-7326 About College Way Commercial Plaza, LLC College Way Commercial Plaza, LLC, filed a Chapter 11 bankruptcy petition (Bankr. W.D. Wash Case No. 13-47724) on Dec. 19, 2013. The petition was signed by Sherwood B Korssjoen as member and manager. The Debtor disclosed $29,160,000 in assets and $21,444,155 in liabilities as of the Chapter 11 filing. Masafumi Iwama, Esq., at Iwama Law Firm, serves as the Debtor's counsel. Judge Brian D Lynch presides over the case. COMMONWEALTH EDISON: Fitch Hikes Preferred Stock Rating From 'BB+' ------------------------------------------------------------------ Fitch Ratings has taken a number of actions with respect to the ratings and Rating Outlooks of Exelon Corp. (EXC) and its subsidiaries. The ratings actions include the following: -- Affirmed the 'BBB+' Issuer Default Ratings (IDR) and instrument ratings of Exelon Corp. (EXC) and Exelon Generation Co., LLC (Exgen) and revised the Rating Outlook for each entity to Negative from Stable. -- Upgraded the IDR of Commonwealth Edison Co. (Comed) to 'BBB' from 'BBB-' and revised the Rating Outlook to Stable from Positive. Comed's instrument ratings were also upgraded one- notch. -- Affirmed the 'BBB' IDR and instrument ratings of Baltimore Gas and Electric Co. (BGE) and revised the Rating Outlook to Positive from Stable. -- Affirmed the 'BBB+' IDR and instrument ratings of PECO Energy Co. (PECO) with a Stable Rating Outlook. The Negative Rating Outlooks for EXC and Exgen primarily reflect the continued down trend in gross margin and credit protection measures due to the on-going weakness in forward power and natural gas prices, soft power demand and aggressive competition in the retail supply business. Exgen remains the largest contributor to EXC's cash flow and as such the Negative Ratings Outlook for EXC mirrors that of its non-regulated subsidiary. The revised Rating Outlook also considers that credit protection measures, although declining remain solidly within the investment grade category. The upgrade of Comed reflects the improvement in credit metrics due in large measure to tariff increases over the past several years and the greater predictability of earnings and cash flow due to the implementation of a formula rate plan (FRP) in Illinois. Similarly, the Positive Rating Outlook for BGE results from higher rates and improving credit measures. The rating and Stable Rating Outlook for PECO are consistent with the company's strong credit profile. Key Rating Drivers Exelon Corp. Competitive Generation Business: Low power prices, weak demand and aggressive competitive pricing behavior have adversely affected wholesale and retail margins and are expected by Fitch to persist for several more years keeping pressure on credit quality measures. Utility Earnings Contribution: The consolidated ratings also consider the contributions of EXC's three regulated utilities, which account for about 50% of consolidated earnings and cash flow. The utilities have sound and/or improving credit profiles, limited commodity price risk and a relatively predictable earnings stream, balancing the more volatile earnings and cash flow of the commodity sensitive merchant business. Prudent Financial Management: Management has taken a number of steps over the past 15-months to reduce financial commitments and solidify credit quality in the face of persistently low power prices that are pressuring wholesale and retail profit margins. The credit supportive actions include substantial reductions in merchant capex and the common stock dividend. Consequently, financial metrics are expected by Fitch to remain solidly within the investment grade category. In February 2013, EXC reduced its common stock dividend by 40%, saving nearly $750 million annually. The dividend reduction followed a $2.3 billion reduction in merchant capex that have subsequently been further reduced. Financial Position: The combined reductions of the common stock dividend and capex have solidified EXC's financial position. Fitch estimates EXC's adjusted ratio of funds from operations (FFO)/interest to be in excess of 6.0x over the next several years and FFO/debt to approximate 30%. Liquidity: Liquidity is ample and debt maturities should be manageable. On a consolidated basis committed credit facilities aggregate $8.4 billion, and extend to 2018. Rating Sensitivity Positive -- Other than an unexpected change in business strategy (i.e. additional sources of regulated earnings and cash flow), positive rating action at the parent is unlikely at the present rating level. Negative -- Lack of rate support for utility infrastructure investments or changes in the commodity cost recovery provisions in Illinois, Pennsylvania or Baltimore. -- More aggressive growth strategy that increased business risk and/or leverage. -- Increase in risk appetite as evidenced by change in hedging strategy at Exgen. Exelon Generation Company, LLC Operating environment: The operating environment for Exgen's competitive generation business is expected to remain challenging with sluggish demand and low natural gas and power prices likely to persist for several years with a downtrend in gross margin. Favorably, Exgen is expected to be free cash flow (FCF) positive due to reduced capex and dividend requirements, easing the pressure on cash flow and credit quality measures during a low point in the commodity cycle. Competitive Position: Exgen's largely nuclear-fueled generating fleet is positioned low on the dispatch curve and likely to be dispatched under any price scenario. The nuclear fleet is also well positioned to benefit from any uplift in power prices from higher environmental costs or plant retirements and requires limited environmental remediation expenditures. Nonetheless, several nuclear plants operating in regions without a capacity market are at risk for closure. Expense Reductions: Exgen entered into a service agreement to operate the Constellation Energy Nuclear Group (CENG) nuclear fleet that is expected by management to generate annual savings of roughly $50 million-$70 million annually (Exgen's share is 50%) with a $20 million cost to achieve. NRC approval is required. CENG is a joint venture with Electricite de France. The transaction is expected to close late in 2014 Q1 or early Q2. Financial Position: Exgen's financial position has weakened in recent years, but remains solidly within the investment grade category. Fitch expects expense and debt reductions to offset on- going declines in gross margin and stabilize credit metrics at or near current levels. Fitch estimates Exgen's adjusted ratio of EBITDA/interest to range between 5.5x and 6.0x and debt/EBITDA at about 2.5x-2.75x. Cash flow measures are expected to be stronger with FFO/debt to be in excess of 40% and FFO/interest to exceed 7.0x. Debt Reduction: Since the dividend reduction Exgen has retired $950 million of recourse debt with cash including $450 million of callable junior subordinated debt at par in June 2013 and $500 million of maturing senior debt in January 2014. Additional debt retirements are anticipated in 2015. Revised Growth Plan: Planned capital expenditures were reduced $2.3 billion and now aggregate $6.8 billion over the 2014-2016 time frame. The reductions were primarily investments in unidentified renewable projects and cancelling planned nuclear uprates at the LaSalle and Limerick units, totaling nearly 600 MW to beyond 2019. Over the three-year period through 2016, growth capex is now about $775 million for nuclear uprates and wind and solar projects, including the build-out of the Antelope Valley Solar Ranch (AVSR). Exgen will also be investing approximately $350 million to construct generation in Maryland required as part of the Constellation merger approval. Fitch believes other investments are likely, but will be limited to contracted renewables or possibly distressed merchant assets in regions that have a well-functioning capacity market and/or a tight reserve position. Rating Sensitivity Positive: -- There are no developments that are likely to lead to a positive rating action. -- However, ratings could be maintained if there is clear evidence of a sustainable improvement in power prices and/or capacity revenue. Negative: -- A further decline in gas and power prices; -- An unexpected reversion to a more aggressive growth strategy. Commonwealth Edison Co. Strong Credit Metrics: Higher rates effective Jan. 1, 2014 and the FRP plan that allows for annual rate adjustments should allow Commonwealth Edison Co. (Comed) to sustain its currently sound financial position over the next few years. Fitch estimates EBITDA/interest will average about 5.0x, FFO/interest 4.5x, FFO/debt 18% - 20% and debt/EBITDA about 3.75x over the next several years. Each measure is strong for the current rating. Regulatory Predictability: The FRP implemented in October 2011 provides increased regulatory predictability in Illinois. The FRP recognizes forward looking capital additions and includes a true- up mechanism reducing, albeit not eliminating, rate lag. Constructive Rate Decision: In December 2013, the Illinois Commerce Commission approved a $341 million increase in distribution rates or approximately 97% of the company's rate request. Commodity Price Exposure: Ratings and credit quality benefit from the absence of commodity price exposure, which limits cash flow volatility and reduces business risk. Rising Capex: Capital expenditures are forecasted to rise to approximately $5.7 billion over the three-year period 2014-2016, compared to $3.7 billion in the prior three-year period. The higher outlays are primarily driven by the Illinois Energy Infrastructure Modernization Act (EIMA), which requires Comed to invest an incremental $1.3 billion on electric system upgrades over five years and an additional $1.3 billion for smart grid deployment over 10 years. The legislation provides for recovery through the FRP filings. The capex forecast also reflects an increase in transmission expenditures, which are subject to credit supportive Federal Energy Regulatory Commission (FERC) regulatory policies. Like-Kind-Exchange: Comed's exposure to the IRS's disallowance of the tax benefits associated with a like-kind-exchange is a credit concern, however, the issue is not likely to be resolved for several years and was not factored into the rating decision. As of Sept. 30, 2013, Comed's potential tax and interest that could become payable, excluding penalties, is $305 million. Rating Sensitivity Positive: -- A continuation of constructive outcomes in FRP filings; -- Ability to reduce leverage below 3.5x. Negative: -- Lack of rate support for infrastructure investments or changes in the commodity cost recovery provisions. PECO Energy Co. Strong Credit Profile: Historical and projected credit measures are strong and well in excess of Fitch's target ratios for the current rating category and the companies' peer group of 'BBB+' distribution utilities. Over the next few years, Fitch estimates EBITDA/interest and FFO/interest will average about 7.0x and 6.0x, respectively and FFO/debt and debt/EBITDA about 20% and 3.0x. The strong performance reflects expectations of timely rate recovery and moderate debt financing. Alternative Regulatory Model: Fitch considers the regulatory legislation enacted in Pennsylvania in February 2012 (HB 1294) to be supportive of credit quality. Manageable Capital Spending: PECO expects to invest approximately $1.6 billion over the next three years, moderately higher than the $1.4 billion expended in the prior three-years. The expenditures equate to about 2.2x depreciation and amortization, which approximates the industry in average. Low business Risk: Ratings and credit quality benefit from the absence of commodity price exposure and the associated cash flow volatility. Rating Sensitivity PECO Energy Company Positive: -- Sustaining current financial condition could lead to a positive rating action. Negative: -- Not likely given the head room in current ratings. Baltimore Gas and Electric Company Credit Metrics: BGE's financial position improved significantly in 2013 largely due to electric and gas rate increases implemented in February 2013, the first increases since December 2010 and the expiration of a $112 million rate credit. Subsequent electric and gas rate increases implemented in December 2013 are expected to drive further improvement in 2014 and beyond. Fitch estimates EBITDA/interest and FFO/interest to exceed 6.0x and FFO/debt and debt/EBITDA of about 25% and 2.5x, respectively. Dividend Restrictions: BGE is precluded from paying dividends to parent Exelon Corp. (Exelon) through 2014 Regulatory Recovery Mechanisms: Rate adjustment mechanisms outside of base rate cases tend to stabilize BGE's on-going cash flow. These include decoupling for both residential and commercial gas and electricity sales and purchased gas and purchased power recovery mechanisms. In addition, investments in energy efficiency are subject to a tracking mechanism. Ring-fencing: BGE's funding and Treasury practices result in moderate ring fencing of the utility from its parent Exelon Corp. and affiliates. These include maintaining separate books and records and separate credit facilities and commercial paper programs and allocating parent expenses according to a Cost Allocation Manual that is filed annually with the Maryland Public Service Commission (MPSC). Also, BGE does not participate in the corporate money pool. Furthermore, BGE's financings do not contain any provisions that could result in cross defaults between BGE and Exelon. Rating Sensitivity Positive: -- A constructive outcome in expected 2014 rate filing. Negative: -- Lack of rate support for infrastructure investments or changes in the commodity cost recovery provisions. Fitch has affirmed the following ratings with a Negative Outlook: Exelon Corp. -- Issuer Default Rating (IDR) 'BBB+'; -- Senior unsecured debt 'BBB+'; -- Commercial paper 'F2'; -- Short-term IDR 'F2'. Exelon Generation Co., LLC -- Issuer Default Rating (IDR) 'BBB+'; -- Senior unsecured debt 'BBB+'; -- Commercial paper 'F2'; -- Short-term IDR 'F2'. Fitch has affirmed the following ratings with a Positive Outlook: Baltimore Gas and Electric Company -- Issuer Default Rating (IDR) 'BBB; -- First mortgage bonds 'A-'; -- Senior unsecured debt 'BBB+'; -- Pollution control revenue bonds 'BBB+' -- Preferred stock to 'BBB-'; -- Short-term IDR 'F2'; -- Commercial paper 'F2'. Fitch has upgraded the following ratings with a Stable Outlook: Commonwealth Edison Company -- Issuer Default Rating (IDR) to 'BBB' from 'BBB-; -- First mortgage bonds to 'A-' from 'BBB+'; -- Senior unsecured debt to 'BBB+' from 'BBB'; -- Preferred stock to 'BBB-' from 'BB+'; -- Short-term IDR to 'F2' from 'F3'; -- Commercial paper to 'F2' from 'F3'. ComEd Financing Trust III -- Preferred stock to 'BBB-' from 'BB+'. Fitch has affirmed the following ratings with a Stable Outlook: PECO Energy Co. -- Issuer Default Rating (IDR) 'BBB+'; -- First mortgage bonds 'A'; -- Senior unsecured debt 'A-'; -- Commercial paper 'F2'; -- Short-term IDR 'F2'. PECO Energy Capital Trust III -- Preferred stock 'BBB'. PECO Energy Capital Trust IV -- Preferred stock 'BBB'. COMMUNITY HOME: Chapter 11 Trustee Hires Jones Walker as Counsel ---------------------------------------------------------------- Kristina M. Johnson, the Chapter 11 trustee of the estate of Community Home Financial Services, Inc. asks for permission from the U.S. Bankruptcy Court for the Southern District of Mississippi to employ Jones Walker LLP as counsel, nunc pro tunc to Jan. 8, 2014. The Trustee requires John Walker to: (a) prepare and file any amendments to the Schedules and Statement of Financial Affairs; (b) advise the Trustee with respect to her powers and duties as Trustee and in the continued management operation of the Debtor's business; (c) advise the Trustee with respect to the administration of the Debtor's estate; (d) attend meetings and negotiate with representatives of creditors, counter parties to executory contracts and unexpired leases to which the estate is a party, and other parties in interest; (e) advise the Trustee and consult on the conduct of the case, including all of the legal and administrative requirements of operating in Chapter 11; (f) take all necessary action to protect and preserve the Chapter 11 estate, including investigation of potential causes of action possessed by the estate, the prosecution of civil actions by the estate, defense of any civil commenced against the estate, adversary proceedings and contested matters involving the estate, negotiating concerning all litigation in which the Chapter 11 estate is involved, evaluations of claims and liens of various creditors, and, where appropriate, to object to such claims or liens against the estate or its property; (g) prepare on behalf of the Trustee all motions, applications, responses, answers, orders, and other pleadings, as well as agreements, reports, accounts, and other documents and papers necessary for the administration of the estate; (h) advise and consult with the Trustee and other professionals she may retain in connection with any sale of the Debtor's assets, as well as with any disclosure statement and plan of reorganization or liquidation, and to represent the Trustee in any matter arising out of, related to or in connection with such plan, disclosure statement, and all related agreements or documents, as well as any matters that are necessary for the confirmation, implementation or consummation of such plan; and (i) perform all other necessary legal services and provide all other necessary legal advice to the Trustee in connection with all aspects this Chapter 11 case. John Walker will be paid at these hourly rates: Patrick R. Vance, Partner (New Orleans) $450 Elizabeth J. Futrell, Partner (New Orleans) $415 Ellis Brazeal, Partner (Birmingham) $390 Jeffrey R. Barber, Partner (Jackson) $340 Kristina M. Johnson, Partner (Jackson) $340 Patrick McCune, Associate (Baton Rouge) $250 Lindsey Dowdle, Associate (Jackson) $220 Kilby Brabston, Legal Assistant (Jackson) $155 Jones Walker will also be reimbursed for reasonable out-of-pocket expenses incurred. Jeffrey R. Barber, partner of Jones Walker, 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. The Court for the Southern District of Mississippi will hold a hearing on the engagement on March 4, 2014, at 2:30 p.m. Jones Walker can be reached at: Jeffrey R. Barber, Esq. JONES WALKER LLP 190 East Capitol St., Suite 800 P.O. Box 427 Jackson, MS 39205-0427 Tel: (601) 949-4765 Fax: (601) 949-4804 E-mail: jbarber@joneswalker.com About Community Home Community Home Financial Services, Inc., filed a Chapter 11 petition (Bankr. S.D. Miss. Case No. 12-01703) on May 23, 2012. Community Home Financial is a specialty finance company located in Jackson, Mississippi, providing contractors with financing for their customers. CHFS operates from one central location providing financing through its dealer network throughout 25 states, Alabama, Delaware, and Tennessee. The Debtor scheduled $44,890,581 in total assets and $30,270,271 in total liabilities. Judge Edward Ellington presides over the case. The Debtor was first represented by Roy H. Liddell, Esq., and Jonathan Bissette, Esq., at Wells, Marble, & Hurst, PPLC as Chapter 11 counsel. Wells Marble was terminated Nov. 13, 2013. The Debtor is now being represented by: Derek A. Henderson, Esq. 1765-A Lelia Drive, Suite 103 Jackson, MS 39216 Tel: 601-948-3167 E-mail: Derek@derekhendersonlaw.com In 2013, the Debtor sought to employ David Mullin, Esq., at Mullin Hoard & Brown LLP, as special counsel. On Aug. 8, 2013, the Court approved the Disclosure Statement explaining the Debtor's Plan of Reorganization dated Jan. 29, 2013. COMMUNITY HOME: Ch.11 Trustee's "Disinterestedness" Questioned -------------------------------------------------------------- Community Home Financial Services Inc. and creditor William D. Dickson ask the U.S. Bankruptcy Court for the Southern District of Mississippi to alter or amend the order approving the appointment of Kristina M. Johnson as Chapter 11 trustee for the Debtor's bankruptcy case. The Debtor and Mr. Dickson tell the Court that Ms. Johnson is presently partner of Jones Walker LLP, which has pre-existing and continuing attorney-client relationship with Robert A. Cunningham and his firm Grantham Poole. Mr. Cunningham and Grantham Poole were retained by the Debtor to render independent expert accounting services on July 11, 2013. Mr. Cunningham has worked to keep critical evidences which directly support the Debtor's objections to the proofs of claim of two creditors, Edwards Family Partnership and Beher Holdings Trust. The Debtor and Mr. Dickson tell the Court the motion was filed to address all issues relating to the disinterestedness of Ms. Johnson as Chapter 11 trustee, including, without limitations, findings and conclusions expressly addressing the particular circumstances of the case: -- whether Ms. Johnson is disinterested in light of her relationship with Jones Walker and the relationships that she and/or Jones Walker have with Mr. Cunningham and Grantham Poole; -- whether Ms. Johnson's partnership in Jones Walker and the relationship that Jones Walker has with Mr. Cunningham and Grantham Poole make her and/or Jones Walker interested parties who are not "disinterested"; and -- whether Ms. Johnson's subsequent and intervening motion to employ Jones Walker makes her and/or Jones Walker an interested party who is not "disinterested" due to the relationships that Ms. Johnson and Jones Walker have with Mr. Cunningham and Grantham Poole, and for any other relief that the Court deems appropriate. A full-text copy of the request of Community Home and William Dickson is available for free at http://is.gd/szwRG4 Mr. Dickson is represented in the case by: Eileen N. Shaffer, Esq. 401 E. Capitol Street #316 Jackson, MS 39201 Tel: 601-969-3006 E-mail: enslaw@bellsouth.net About Community Home Community Home Financial Services, Inc., filed a Chapter 11 petition (Bankr. S.D. Miss. Case No. 12-01703) on May 23, 2012. Community Home Financial is a specialty finance company located in Jackson, Mississippi, providing contractors with financing for their customers. CHFS operates from one central location providing financing through its dealer network throughout 25 states, Alabama, Delaware, and Tennessee. The Debtor scheduled $44,890,581 in total assets and $30,270,271 in total liabilities. Judge Edward Ellington presides over the case. The Debtor was first represented by Roy H. Liddell, Esq., and Jonathan Bissette, Esq., at Wells, Marble, & Hurst, PPLC as Chapter 11 counsel. Wells Marble was terminated Nov. 13, 2013. The Debtor is now being represented by Derek A. Henderson, Esq., in Jackson, Miss. In 2013, the Debtor sought to employ David Mullin, Esq., at Mullin Hoard & Brown LLP, as special counsel. On Aug. 8, 2013, the Court approved the Disclosure Statement explaining the Debtor's Plan of Reorganization dated Jan. 29, 2013. CONSTAR INT'L: Gets Court OK to Hire Prime Clerk as Admin. Advisor ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized Constar International Holdings LLC and its debtor-affiliates to employ Prime Clerk LLC as administrative advisor, nunc pro tunc to the Dec. 19, 2013 petition date. As reported in Troubled Company Reporter on Jan. 10, 2014, the Debtors require Prime Clerk to: (a) assist with, among other things, solicitation, balloting and tabulation of votes, and prepare any related reports, as required in support of confirmation of a Chapter 11 plan, and in connection with such services, process requests for documents from parties in interest, including, if applicable, brokerage firms, bank back-offices and institutional holders; (b) prepare an official ballot certification and, if necessary, testify in support of the ballot tabulation results; (c) assist with the preparation of the Debtors' schedules of assets and liabilities and statements of financial affairs and gather data in conjunction therewith; (d) provide a confidential data room, if requested; (e) manage and coordinate any distributions pursuant to a Chapter 11 plan; and (f) provide such other processing, solicitation, balloting and other administrative services described in the Engagement Agreement. Prime Clerk will be paid at these hourly rates: Director of Solicitation $225 Solicitation Analyst $200 Senior Case Manager $190 Case Manager $165 Analyst $135 Technology Consultant $125 Clerk $45 Prime Clerk will also be reimbursed for reasonable out-of-pocket expenses incurred. Prior to the petition date, the Debtors provided Prime Clerk a retainer in the amount of $25,000. Michael J. Frishberg, co-president and chief operating officer of Prime Clerk, 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. Shai Waisman, the CEO and Co-Founder of Prime Clerk, was a former business finance and restructuring partner at Weil Gotshal. Prime Clerk can be reached at: Michael J. Frishberg Shai Y. Waisman PRIME CLERK LLC 830 Third Avenue, 9th Floor New York, NY 10022 Tel: (212) 257-5450 E-mail: swaisman@primeclerk.com About Constar International Privately held Constar International Holdings and nine affiliated debtors filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13281) on Dec. 19, 2013. This is Constar International's third bankruptcy. Constar, which manufactures plastic containers, first filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13432) in December 2008, with a pre-negotiated Chapter 11 Plan and emerged from bankruptcy in May 2009. Constar and its affiliates returned to Chapter 11 protection (Bankr. D. Del. Case No. 11-10109) on Jan. 11, 2011, with a pre-negotiated Chapter 11 plan and emerged from bankruptcy in June 2011. The 2013 petition listed assets worth less than $100 million against $123 million on three layers of secured debt. Judge Christopher S. Sontchi oversees the 2013 case. Constar is represented by Michael J. Sage, Esq., Brian E. Greer, Esq., Stephen M. Wolpert, Esq., and Janet Bollinger Doherty, Esq., at Dechert LLP; and Robert S. Brady, Esq., and Sean T. Greecher, Esq., at Young Conaway Stargatt & Taylor, LLP. Prime Clerk LLC serves as the Debtors' claims and noticing agent, and administrative advisor. Lincoln Partners Advisors LLC serves as the Debtors' financial advisor. Attorneys at Brown Rudnick LLP represent the official committee of unsecured creditors. Counsel to Wells Fargo Capital Finance, LLC, the revolving loan agent, is Andrew M. Kramer, Esq., at Otterbourg P.C. CONSTAR INT'L: Can Hire Young Conaway as Attorneys -------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Constar International Holdings LLC and its debtor-affiliates to employ Young Conaway Stargatt & Taylor, LLP as attorneys, nunc pro tunc to the Dec. 19, 2013 petition date. As reported in Troubled Company Reporter on Jan. 10, 2014, the Debtors require Young Conaway to: (a) provide legal advice with respect to the Debtors' powers and duties as debtors in possession in the continued operation of their business, management of their properties, and sale of their assets; (b) prepare and pursue confirmation of a plan and approval of a disclosure statement; (c) prepare on behalf of the Debtors necessary applications, motions, answers, orders, reports and other legal papers; (d) appear in Court to protect the interests of the Debtors before the Court; and (e) perform all other legal services for the Debtors which may be necessary and proper in these proceedings. Young Conaway will be paid at these hourly rates: Robert S. Brady, partner $765 Sean T. Greecher, partner $475 Maris J. Kandestin, associate $430 Elizabeth S. Justison, associate $280 Chad A. Corazza, paralegal $160 Young Conaway will also be reimbursed for reasonable out-of-pocket expenses incurred. Young Conaway received a retainer in the amount of $75,000 on Dec. 5, 2013, plus filing fees in the amount of $12,130, which were paid on Dec. 12, 2013, in connection with the planning and preparation of initial documents and Young Conaway's proposed post-petition representation of the Debtors. A part of the retainer has been applied to any additional outstanding balances existing as of the petition date. The remainder will constitute a general retainer as security for post-petition services and expenses incurred during the Chapter 11 cases. Robert S. Brady, Esq., partner at Young Conaway, 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. Young Conaway can be reached at: Robert S. Brady, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP 1000 N. King Street, Rodney Square Wilmington, DE 19801 Tel: (302) 571-6600 Fax: (302) 571-1253 E-mail: rbrady@ycst.com About Constar International Privately held Constar International Holdings and nine affiliated debtors filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13281) on Dec. 19, 2013. This is Constar International's third bankruptcy. Constar, which manufactures plastic containers, first filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13432) in December 2008, with a pre-negotiated Chapter 11 Plan and emerged from bankruptcy in May 2009. Constar and its affiliates returned to Chapter 11 protection (Bankr. D. Del. Case No. 11-10109) on Jan. 11, 2011, with a pre-negotiated Chapter 11 plan and emerged from bankruptcy in June 2011. The 2013 petition listed assets worth less than $100 million against $123 million on three layers of secured debt. Judge Christopher S. Sontchi oversees the 2013 case. Constar is represented by Michael J. Sage, Esq., Brian E. Greer, Esq., Stephen M. Wolpert, Esq., and Janet Bollinger Doherty, Esq., at Dechert LLP; and Robert S. Brady, Esq., and Sean T. Greecher, Esq., at Young Conaway Stargatt & Taylor, LLP. Prime Clerk LLC serves as the Debtors' claims and noticing agent, and administrative advisor. Lincoln Partners Advisors LLC serves as the Debtors' financial advisor. Attorneys at Brown Rudnick LLP represent the official committee of unsecured creditors. Counsel to Wells Fargo Capital Finance, LLC, the revolving loan agent, is Andrew M. Kramer, Esq., at Otterbourg P.C. CONSTAR INT'L: Court Approves Dechert LLP as Attorneys ------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized Constar International Holdings LLC and its debtor-affiliates to employ Dechert LLP as attorneys, nunc pro tunc to the Dec. 19, 2013 petition date. As reported in the Troubled Company Reporter on Jan. 10, 2014, the Debtors require Dechert LLP to: (a) advise the Debtors with respect to their powers and duties as debtors in possession in the continued management and operation of their businesses and properties; (b) advise and consult on the conduct of these Chapter 11 cases, including all of the legal and administrative requirements of operating in Chapter 11; (c) attend meetings and negotiate with representatives of creditors and other parties in interest; (d) take all necessary actions to protect and preserve the Debtors' estates, including prosecuting actions on the Debtors' behalf, defending any action commenced against the Debtors, and representing the Debtors in negotiations concerning litigation in which the Debtors are involved, including objections to claims filed against the Debtors' estates; (e) prepare pleadings in connection with these Chapter 11 cases, including motions, applications, answers, orders, reports, and papers necessary or otherwise beneficial to the administration of the Debtors' estates; (f) represent the Debtors in connection with obtaining authority to continue using cash collateral and post- petition financing; (g) advise the Debtors in connection with any potential sale of assets; (h) appear before the Court and any appellate courts to represent the interests of the Debtors' estates; (i) advise the Debtors regarding tax matters; (j) take any necessary action on behalf of the Debtors to negotiate, prepare and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; and (k) perform all other necessary legal services for the Debtors in connection with the prosecution of these Chapter 11 cases, including: (i) analyzing the Debtors' leases and contracts and the assumption and assignment or rejection thereof; (ii) analyzing the validity of liens against the Debtors; and (iii) advising the Debtors on corporate and litigation matters. Dechert LLP will be paid at these hourly rates: Michael J. Sage $1,050 Brian E. Greer $780 Stephen M. Wolpert $675 Janet B. Doherty $620 Deborah S. Sohn $450 Andrew Harmeyer $405 Partners $650-$1,200 Associates $405-$750 Paraprofessionals $205-$405 Dechert LLP will also be reimbursed for reasonable out-of-pocket expenses incurred. During the 12-month period prior to the commencement of these cases, Dechert LLP received an aggregate of $1,421,520.44 for professional services performed and reimbursement of expenses incurred in connection with Dechert LLP's representation of the Debtors. Within 90 days prior to the petition date, Dechert LLP received $1,421,520.44 including $1,420,000 in advance retainers. As of the petition date, Dechert LLP holds approximately $200,000 of an advance retainer, subject to continuing reconciliation. Michael J. Sage, Esq., partner at Dechert 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. Dechert LLP can be reached at: Michael J. Sage, Esq. DECHERT LLP 1095 Avenue of the Americas New York, NY 10036 Tel: (212) 698-3500 Fax: (212) 698-3599 About Constar International Privately held Constar International Holdings and nine affiliated debtors filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13281) on Dec. 19, 2013. This is Constar International's third bankruptcy. Constar, which manufactures plastic containers, first filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13432) in December 2008, with a pre-negotiated Chapter 11 Plan and emerged from bankruptcy in May 2009. Constar and its affiliates returned to Chapter 11 protection (Bankr. D. Del. Case No. 11-10109) on Jan. 11, 2011, with a pre-negotiated Chapter 11 plan and emerged from bankruptcy in June 2011. The 2013 petition listed assets worth less than $100 million against $123 million on three layers of secured debt. Judge Christopher S. Sontchi oversees the 2013 case. Constar is represented by Michael J. Sage, Esq., Brian E. Greer, Esq., Stephen M. Wolpert, Esq., and Janet Bollinger Doherty, Esq., at Dechert LLP; and Robert S. Brady, Esq., and Sean T. Greecher, Esq., at Young Conaway Stargatt & Taylor, LLP. Prime Clerk LLC serves as the Debtors' claims and noticing agent, and administrative advisor. Lincoln Partners Advisors LLC serves as the Debtors' financial advisor. Attorneys at Brown Rudnick LLP represent the official committee of unsecured creditors. Counsel to Wells Fargo Capital Finance, LLC, the revolving loan agent, is Andrew M. Kramer, Esq., at Otterbourg P.C. CONSTAR INT'L: May Hire Lincoln Partners as Financial Advisor ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Constar International Holdings LLC and its debtor-affiliates to employ Lincoln Partners Advisors LLC as financial advisor, nunc pro tunc to the Dec. 19, 2013 petition date. As reported in the Troubled Company Reporter on Jan. 10, 2014, pursuant to the engagement letter, Lincoln Advisors will provide financial advisory services if requested by the Debtors with respect to a Sale Transaction or Restructuring Transaction. In connection with a Sale Transaction, Lincoln Advisors will assist the Debtors with: (a) identifying potential parties who might be interested in entering into a Sale Transaction; (b) assisting with the preparation of an information memorandum for delivery to potential parties to a Sale Transaction describing the Debtors, and business and the assets to be sold; (c) formulating and recommending a strategy for pursuing a potential Sale Transaction and maximizes return to the Debtors; (d) contacting and eliciting interest from potential parties to a Sale Transaction; (e) conveying information desired by potential parties to a Sale Transaction; (f) reviewing and evaluating potential parties to a Sale Transaction; (g) reviewing and analyzing proposals regarding a potential Sale Transaction; (h) advising the board and sub-committees thereof with respect to the consideration, terms, conditions and value of a potential Sale Transaction; and (i) advising and assisting the Debtors with respect to executing a Sale Transaction through its closing. With respect to a Restructuring Transaction, Lincoln Advisors will assist the Debtors with: (a) developing a restructuring plan; (b) structuring any securities to be issued pursuant to the restructuring plan; (c) negotiating the restructuring plan with lenders, creditors and other interested parties; (d) developing a plan of reorganization; and (e) participating in hearings before the relevant bankruptcy court, if applicable, with respect to matters upon which Lincoln Advisors has provided advice, including, as relevant, coordinating with the Debtors' legal counsel with respect to testimony in connection herewith. The Debtors will pay Lincoln Advisors non-refundable cash fees of $50,000 per month ("Monthly Fee"). Where 100% of the initial retainer and the monthly fees paid to Lincoln Advisors will be credited against any Sale Transaction Fee and 50% of the Monthly Fees paid to Lincoln Advisors will be credited against any Restructuring Transaction Fee payable by the Debtors. In the event of a Sale Transaction, the Debtors will pay Lincoln Advisors a transaction fee equal to 1% of the Enterprise Value up to and including $125,000,000 and 2% of Enterprise Value in excess of $125,000,000 less 100% of the initial retainer and monthly fees paid to Lincoln Advisors ("Sale Transaction Fee"). The minimum sale transaction fee shall be $800,000 and the Sale Transaction Fee shall be due and payable in cash at the time of the actual closing of the Sale Transaction directly from the proceeds of such transaction before application or distribution to any stakeholder of the Debtors. In the event of a Restructuring Transaction, the Debtors will compensate Lincoln Advisors with a transaction fee equal to $800,000 ("Restructuring Transaction Fee"). The Restructuring Transaction Fee shall be due and payable in cash at the time of the closing of the Restructuring Transaction. Lincoln Advisors will also be reimbursed for reasonable out-of- pocket expenses incurred. Lincoln Advisors will not incur expenses in excess of $10,000 in any monthly billing period or $75,000 in the aggregate without prior written consent of the Debtors. Lincoln Advisors has received a $50,000 initial retainer in connection with the financial advisory services provided to the Debtors which covered the first month of services from Oct. 10, 2013 through Nov. 9, 2013. Lincoln Advisors has also received a Monthly Fee which covered the time period of Nov. 10, 2013 through Dec. 9, 2013 and an additional Monthly Fee which covered Dec. 10, 2013 through Jan. 9, 2014. In addition, on Dec. 6, 2013, Lincoln Advisors received a retainer of $50,000 to be applied to any prepetition amounts outstanding for reasonable expenses incurred in conjunction with the performance of services pursuant to the engagement letter and Lincoln Advisors will credit any remaining balance towards any post-petition fees and expenses incurred and approved by the Court. During the 90 days immediately preceding the petition date, Lincoln Advisors received $200,000 in connection with services provided to the Debtors, which includes the Initial Retainer and Monthly Fees and the retainer. Alexander W. Stevenson, managing director of Lincoln Partner Advisors LLC, 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. Lincoln Advisors can be reached at: Alexander W. Stevenson LINCOLN PARTNER ADVISORS LLC 633 West Fifth Street, Suite 6650 Los Angeles, CA 90071 Tel: (213) 283-3710 E-mail: astevenson@lincolninternational.com About Constar International Privately held Constar International Holdings and nine affiliated debtors filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13281) on Dec. 19, 2013. This is Constar International's third bankruptcy. Constar, which manufactures plastic containers, first filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 08-13432) in December 2008, with a pre-negotiated Chapter 11 Plan and emerged from bankruptcy in May 2009. Constar and its affiliates returned to Chapter 11 protection (Bankr. D. Del. Case No. 11-10109) on Jan. 11, 2011, with a pre-negotiated Chapter 11 plan and emerged from bankruptcy in June 2011. The 2013 petition listed assets worth less than $100 million against $123 million on three layers of secured debt. Judge Christopher S. Sontchi oversees the 2013 case. Constar is represented by Michael J. Sage, Esq., Brian E. Greer, Esq., Stephen M. Wolpert, Esq., and Janet Bollinger Doherty, Esq., at Dechert LLP; and Robert S. Brady, Esq., and Sean T. Greecher, Esq., at Young Conaway Stargatt & Taylor, LLP. Prime Clerk LLC serves as the Debtors' claims and noticing agent, and administrative advisor. Lincoln Partners Advisors LLC serves as the Debtors' financial advisor. Attorneys at Brown Rudnick LLP represent the official committee of unsecured creditors. Counsel to Wells Fargo Capital Finance, LLC, the revolving loan agent, is Andrew M. Kramer, Esq., at Otterbourg P.C. COTTONWOOD ESTATES: Wants to Hire Miller Guymon as Counsel ---------------------------------------------------------- Cottonwood Estates Development, LLC seeks permission from the Hon. R. Kimball Mosier of the U.S. Bankruptcy Court for the District of Utah to employ Miller Guymon, P.C. as counsel. The Debtor requires Miller Guymon to: (a) advise the Debtor of its rights, powers and duties as Debtor and debtor in possession; (b) assist the Debtor in taking necessary actions to protect and preserve the estate of the Debtor, including prosecution of actions on the Debtor's behalf, the defense of actions commenced against the Debtor, negotiation of disputes in which the Debtor is involved, and the preparation of objections of claims filed against the estate; (c) assist in preparing, on behalf of the Debtor, all necessary motions, applications answers, orders, reports, and papers in connection with the administration of the Debtor's estate; (d) assist in presenting, on behalf of the Debtor, the Debtor's proposed plan of reorganization and all related transactions and any related revisions, amendments, etc.; and (e) perform all other necessary legal services in connection with the Chapter 11 case. Miller Guymon has received a $66,632.48 retainer, from which it used $1,213 to pay the filing fee, resulting in a remaining retainer of $65,419.48, which the firm will hold in its retainer trust account and use to pay any fees or costs until after receiving approval from the Court through the customary fee application process. Miller Guymon will also be reimbursed for reasonable out-of-pocket expenses incurred. James W. Anderson, attorney practicing in Miller Guymon, 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. Miller Guymon can be reached at: James W. Anderson, Esq. MILLER GUYMON, P.C. 165 Regent Street Salt Lake City, UT Tel: (801) 363-5600 Fax: (801) 363-5601 E-mail: anderson@millerguymon.com Cottonwood Estates Development, LLC filed a Chapter 11 petition (Bankr. D. Utah Case No. 13-34298) on Dec. 30, 2013, in Salt Lake City, Utah. James W. Anderson, Esq., at Miller Guymon, PC, in Salt Lake City, serves as counsel to the Debtor. The Debtor estimated up to $50 million in both assets and debts. CUE & LOPEZ: Wants Plan Exclusivity Period Extended Until April 1 ----------------------------------------------------------------- Cue & Lopez Construction Inc. asks the U.S. Bankruptcy Court for the District of Puerto Rico to extend its exclusive period to file a Chapter 11 plan of reorganization and disclosure statement explaining that plan, until April 1, 2014. The Debtor's initial plan filing deadline expired on Feb. 3, 2014. The Debtor tells the Court that it is reviewing all of the proofs of claim filed in the case against its books and records to determine the allowance of the claims, as well that it is currently in conversations with its two largest secured creditors, Oriental Bank and Scotiabank Puerto Rico. According to the Debtor, its financial advisor and its management are still working on the reconciliation of claims filed in its Chapter 11 proceedings and other financial matters pertaining to a plan. In addition, the matter as to the substantive consolidation is still pending resolution, which is a significant event in these bankruptcy proceedings, the Debtor notes. San Juan, Puerto Rico-based Cue & Lopez Construction, Inc., sought protection under Chapter 11 of the Bankruptcy Code on Oct. 4, 2013 (Case No. 13-08297, Bankr. D.P.R.). The case is assigned to Judge Brian K. Tester. The Debtor is represented by Charles Alfred Cuprill, Esq., at Charles A Curpill, PSC Law Office, in San Juan, Puerto Rico. CPA Luis R. Carrasquillo & Co., P.S.C., serves as its accountant. The Debtor disclosed assets of $12.65 million and liabilities of $16.66 million. The Chapter 11 petition was signed by Frank F. Cue Garcia, president. DEALERTRACK TECHNOLOGIES: S&P Assigns Preliminary 'B+' CCR ---------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its preliminary 'B+' corporate credit rating to Dealertrack Technologies Inc. The outlook is stable. S&P also assigned a preliminary 'BB-' issue-level rating with a preliminary recovery rating of '2' to the company's $200 million revolving credit facility (unfunded at close) and $575 million first-lien term loan. The preliminary '2' recovery rating indicates S&P's expectation for a substantial (70% to 90%) recovery of principal in the event of default. The company is using the loan proceeds together with $397 million of equity and approximately $70 million of cash to fund the approximately $1 billion purchase of Dealer.com. "Our preliminary rating reflects Dealertrack's 'weak' business risk profile and its 'aggressive' financial risk profile, incorporating a relatively narrow and cyclical end market, coupled with the significant relative size of the acquisition and expected leverage of above 4x over the intermediate term," said Standard & Poor's credit analyst Katarzyna Nolan. High revenue growth rate, diversified customer base, and stable operating cash flow generation are partial offsets. S&P views the industry risk as "intermediate" and the country risk as "very low." The stable outlook reflects S&P's expectation that Dealertrack will maintain strong revenue growth and consistent EBITDA margins. Although not likely in the near term, S&P would upgrade the company if it demonstrates satisfactory performance from the new acquisition such that its leverage is sustained in the mid-3x area and its FFO to debt remains in the mid-20% area. S&P could lower the rating if the company pursues sizable debt finance acquisitions or share repurchases, or if margins deteriorate because of increased competition or integration issues, resulting in leverage sustained above 5x. DELUXE ENTERTAINMENT: Moody's Rates New $570MM Secured Loan 'B2' ---------------------------------------------------------------- Moody's Investors Service has assigned a B2 rating to Deluxe Entertainment Services Group, Inc.'s proposed $570 million senior secured term loan facility maturing 2020. In connection with the rating action, Moody's affirmed Deluxe's B2 Corporate Family Rating (CFR) and B2-PD Probability of Default Rating (PDR), and changed the rating outlook to stable from negative. Proceeds from the new term loan will refinance the existing term loan maturing July 2017 (approximately $388 million outstanding) and retire other outstanding obligations, including $78.3 million of borrowings under the ABL credit facility, approximately $43 million of MacAndrews & Forbes (M&F) private equity sponsored subordinated bridge financing (includes preferred stock) and $44.5 million of other loans. The new term loan will benefit from upstream domestic operating subsidiary guarantees and be secured by a first-lien security interest on Deluxe's US assets, except for accounts receivable and deposit accounts, which will be second priority behind the ABL facility. Moody's views the refinancing transaction favorably due to the maturity extension and comparatively lower interest rate on the new term loan, which will reduce annual cash interest expense by around $10 million. Moody's anticipate the terms of the new credit agreement will establish a less restrictive covenant package as Moody's believes the company will be challenged to meet the financial maintenance leverage covenant in the existing term loan, which is scheduled to step down to 2.4x in March 2014. Deluxe also intends to replace the existing $100 million ABL facility with a new unrated $100 million ABL facility maturing 2019, which Moody's expect to be undrawn at closing. Ratings Assigned: Issuer: Deluxe Entertainment Services Group, Inc. $570 Million Senior Secured Term Loan due 2020-B2 (LGD-4, 50%) Ratings Affirmed: Issuer: Deluxe Entertainment Services Group, Inc. Corporate Family Rating -- B2 Probability of Default Rating -- B2-PD The assigned rating is subject to review of final documentation and no material change in the terms and conditions of the transaction as advised to Moody's. Moody's will withdraw the B2 rating on the existing term loan upon full repayment. Ratings Rationale The revision of the outlook to stable from negative reflects reduced business risk and Moody's growing confidence that Deluxe will restore revenue and EBITDA growth this year after completing the exit from the legacy film processing business, which has experienced secular decline since 2008. It also captures management's solid execution in transitioning the client base to the higher margin creative services business without damaging Deluxe's strong brand recognition, long-standing client relationships and high customer retention, as well as reorganizing the operations to compete more effectively through a scalable integrated platform. The business can now deliver a full suite of advanced end-to-end services for the traditional film studio customer base and offer value-added solutions to commercial/enterprise customers in advertising, technology, industrial and retail, which should produce cash flow growth. The B2 CFR reflects Deluxe's position as the leading global provider of outsourced digital content creation, asset management and distribution services to the major feature film studios and other media and entertainment companies. With the effective transformation of the business model to a creative services/digital-based operation, Deluxe has expanded its product offering and created a better customer value proposition that can deliver integrated one-stop shopping solutions along the entire media supply chain. This has enabled Deluxe to deepen its customer relationships within the entertainment industry and extend into non-traditional areas such as advertising agencies' creative departments. At the same time, the rating is constrained by Deluxe's increasing exposure to ad agency revenue (estimated to rise to a third of total revenue from about 20%), lack of proven revenue generation in end-to-end growth areas like Enterprise Solutions, and historical underperformance relative to management's financial projections. Moody's are concerned that M&A activity among ad agencies to increase scale and subsequently negotiate better rates and lower their cost structures to compete more effectively with new low-cost entrants could place downward pressure on media service providers' pricing, especially in market segments where Deluxe does not command premium pricing. The creative business is characterized by seasonal and cyclical swings since revenue drivers include the number of films, TV shows and commercials released/produced, as well as the size of advertising and post- production budgets, which can experience variability during periods of economic weakness, major election years and different calendar quarters. Though there is a growing preference for one-stop media service providers like Deluxe, ad agencies may also delay aggregating and reassigning new mandates that were previously outsourced to various small suppliers. Moody's believe this could result in timing differences when revenue is recognized and lead to negative variance relative to management's projections. However, Moody's do expect long-term trends to remain favorable, across film, broadcast network and cable-TV pilots, TV advertising and digital media industries, which support our forward view that Deluxe will exhibit moderate revenue growth. Deluxe's B2 rating embeds the significant customer concentration as the top ten clients account for about 55% of total revenue. However, Moody's note that the company has enjoyed enduring relationships with all the major film studios, which are generally blue-chip, and has contracts with key accounts that are typically 3-5 years in length. Additionally, because Deluxe supplies a range of services to clients and maintains various touch points within their operations, customer exposure is dispersed across clients' different business units. Further allaying concern and providing support is the company's: (i) technological innovation across numerous areas along the media supply chain, which is vital given that studios are including more digital technology in their filmmaking; (ii) collaborative approach as a trusted advisor and preferred vendor that entrenches Deluxe in customers' workflows and leads to high retention; and (iii) significant scale and global asset base. Collectively, these attributes establish high switching costs. Moody's anticipate adjusted leverage will decline to the low 4x level over the next 18 months aided by EBITDA growth as well as the scheduled amortization and mandatory excess cash flow sweep on the proposed term loan. Deluxe's financial leverage metrics as measured by total debt to EBITDA of 4.5x and free cash flow to debt of 2.2% (Moody's adjusted, as of September 30, 2013) are well-positioned in the B2 rating category given that the median leverage ratios for B2-rated global media industry peers are 5.7x and 2.4%, respectively. Leverage increased in 2012-2013 due to restructuring costs, earnings pressure associated with the business transition and debt incurred to finance near-term maturities. The potential for incremental acquisitions that increase leverage and lead to integration costs and challenges constrains the rating, as does the private equity ownership by MacAndrews & Forbes, which creates event risk in our view. What Could Change the Rating - UP Moody's would consider an upgrade if there was an expectation for total debt to EBITDA maintained comfortably below 3.5x (Moody's adjusted), positive free cash flow to debt sustained at 10% (Moody's adjusted) and cash balances maintained at or better than forecasted levels. An upgrade would also require evidence of: (i) profitable revenue growth execution in Enterprise Solutions; (ii) meeting or exceeding management's financial projections; (iii) limited pricing pressure; and (iv) margin expansion. Finally, management would need to demonstrate a commitment to balance debtholder returns with those of its shareholders and exhibit operating performance and financial policies consistent with a higher rating. What Could Change the Rating - DOWN Ratings could experience downward pressure if there was an erosion of market share in key markets (e.g., DI/Telecine, TV, 2D/3D, International Post, Marketing/Fulfillment and Home Entertainment/Media Services) and operating performance weakened, leading to our expectation that leverage would be sustained above 5.5x total debt to EBITDA (Moody's adjusted), free cash flow to debt would be sustained below 3% (Moody's adjusted) and balance sheet liquidity would deteriorate. Expectations for a capital structure not conservative enough to absorb debt-financed acquisitions, increasing business risk or cash distributions to private equity shareholders could also lead to downward rating pressure. The principal methodology used in this rating was Global Business & Consumer Service Industry Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Burbank, CA, Deluxe Entertainment Services Group, Inc. is a leading provider of end-to-end solutions with a focus on digital content creation (post-set production and post- production), media/distribution (for various file formats and across multiple platforms) and asset management to motion picture studios, television/cable-TV programs, advertising agencies and enterprise customers globally through its creative services business. Deluxe is an indirect wholly-owned subsidiary of MacAndrews & Forbes Holdings Inc. Revenue totaled approximately $1.1 billion for the twelve months ended September 30, 2013. DETROIT, MI: DIA Pledges to Raise $100M for Art, Pension Fund ------------------------------------------------------------- Mark Stryker and John Gallagher, writing for Detroit Free Press, reported that the Detroit Institute of Arts has pledged to raise $100 million for the federally mediated rescue fund to shore up municipal pensions, prevent the forced sale of any of the museum's irreplaceable masterpieces and spin off the city-owned museum to an independent nonprofit. According to the report, DIA leaders said on Jan. 29 that its board of directors approved a $100 million fund-raising campaign over 20 years and would look to corporate and individual donors for the money. As part of the deal, the City of Detroit would transfer legal title to the museum building, the art collection and related assets, ending nearly a century of city control and shielding the museum forever from whims of city finances and politics. The DIA's $100 million commitment marks a potential turning point in Detroit's historic Chapter 9 bankruptcy, helping clear a path to a less painful and faster resolution to the bankruptcy, the report related. The rescue fund brokered by Chief U.S. District Judge Gerald Rosen has now potentially reached at least $820 million, including $370 million pledged by national and local charitable foundations and $350 million in state money proposed by Gov. Rick Snyder that awaits legislative approval. A significant contribution from the DIA has been considered key to garnering political support in Lansing and to satisfy Detroit Emergency Manager Kevyn Orr, who believes that he won't be able to get court approval for his final restructuring plan for the city without somehow accounting for the value of DIA art, the report further related. The coalescing deal between nonprofit foundations, the city of Detroit and the DIA to provide nearly $900 million toward a bankruptcy settlement puts additional pressure on unions, the city's two pension funds, banks and bondholders to provide concessions and support the city's plan of adjustment. None of the money in the rescue fund would go to the museum, the report said. Instead, the dollars would mitigate against cuts to pensions, while in turn protecting the DIA from selling art to pay back creditors. The fund will not make pensioners whole -- Detroit's two municipal pension funds might be underfunded by as much as $3.5 billion. As part of a deal, unions, retirees and other parties would likely agree to forgo further litigation that could bog down the bankruptcy. Judge Steven Rhodes must approve Orr's final restructuring plan before the city can exit bankruptcy. About City of 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 estimated 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. The Hon. Steven Rhodes oversees the bankruptcy case. 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. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. Daniel M. McDermott, U.S. Trustee for Region 9, on Dec. 23, 2013, appointed five creditors to serve on the Official Committee of Unsecured Creditors. DETROIT, MI: Seek to Vacate Appointment of Creditor's Panel ----------------------------------------------------------- The City of Detroit, Michigan filed a motion with the U.S. Bankruptcy Court seeking to vacate the appointment of an official committee of unsecured creditors in the City's bankruptcy case by the Office of the United States Trustee because the appointment of such a committee is discretionary in chapter 9 and is neither necessary nor prudent in the City's case. As a threshold matter, according to Detroit, the U.S. Trustee wrongly argues that section 1102(a) of the Bankruptcy Code requires the U.S. Trustee to appoint a committee of unsecured creditors in a chapter 9 case. The City concedes that section 1102 of the Bankruptcy Code applies in a chapter 9 case by virtue of section 901 of the Bankruptcy Code. However, the part of section 1102 mandating the appointment of unsecured creditors' committees by its terms applies only in chapter 11 cases. The City does not believe there is a statutory basis to read the words "under chapter 11 of this title" out of this provision. Detroit said there is no reason why section 1102 of the Bankruptcy Code should not be read and applied as written. Thus, the statutory requirement for the U.S. Trustee to appoint an official committee of unsecured creditors exists only in chapter 11 cases, and the appointment of such a committee in chapter 9 is wholly discretionary. Moreover, under the circumstances present here, the appointment of the Creditors' Committee is not prudent. Moreover, the appointment of the Creditors' Committee should be vacated because each of the members of the Creditors' Committee, as well as other unsecured creditors of the City, already is well- represented in the City's chapter 9 case. Detroit also said it should not fund any professional fees or costs that might be incurred by the Creditors' Committee, and the Bankruptcy Code does not provide a basis for the Creditors' Committee to charge its costs to the debtor (as it would in chapter 11 cases). Nevertheless, addressing or responding to the activities of the Creditors' Committee is expected to increase costs to the City and unnecessarily divert its limited resources. This additional administrative burden further supports the disbandment of the Creditors' Committee. Finally, the City believes that the Creditors' Committee will be counter-productive to the progress of the City's case. The City is engaged in an extensive court-ordered mediation process with the so-called GRS, the PFRS and the holders and insurers of the COPs, among other parties. The City believes that the appointment of the Creditors' Committee comprised largely of parties already participating in mediation will not advance, and may well disrupt, the mediation. This risk is particularly significant where four of the five Creditors' Committee members already are participating in mediation, with their own counsel, to advocate their individual interests. This potential disturbance in the progress of this case toward the confirmation of a plan of adjustment further supports the relief requested. About City of 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. The Hon. Steven Rhodes oversees the bankruptcy case. 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. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. Daniel M. McDermott, U.S. Trustee for Region 9, on Dec. 23, 2013, appointed five creditors to serve on the Official Committee of Unsecured Creditors. DEVER ELEMENTARY SCHOOL: Headed for Receivership ------------------------------------------------ Adrian Walker at The Boston Globe says that the Dever Elementary School at Dorchester, in Boston, will lay off their teachers and staff because their "turnaround school" has not turned around quickly enough to satisfy state regulators. The report relates that the staff has been informed that they will have to reapply for their jobs, or for other jobs in the system. Dever Elementary School is one of four schools in Massachusetts headed for receivership. The report notes that the school is showing steady signs of improvement but it has not hit the benchmarks dictated by state regulations, and simply doing better is not good enough. How receivership will work is unclear, because no schools have reached this stage, the report relates. No one knows whether the school will retain its dual-language program, or focus on something else entirely, the report discloses. Turnaround schools receive extra money for things like tutoring and extending the school day, but, oddly, that is eliminated when the school goes into receivership, the report notes. Much of the way forward will be decided by Mitchell Chester, the state commissioner of education, the report adds. DIOCESE OF GALLUP: Creditors Want Adequate Measures --------------------------------------------------- Creditors of the Diocese of Gallup urged a bankruptcy judge to implement "adequate measures" to protect the right of the diocese's estate in funds deposited in banks accounts at Wells Fargo Bank N.A. The move came after the diocese asked Judge David Thuma of U.S. Bankruptcy Court for the District of New Mexico to allow its parishes to utilize the funds in 13 previously undisclosed bank accounts at Wells Fargo. In a court filing, the diocese's official committee of unsecured creditors expressed concern over the absence of a mechanism to protect the diocese's estate and its creditors if it is determined that the funds are property of the estate. "The parishes will have unfettered ability to exhaust the funds with no ability for the estate to recover them if they are determined to belong to the estate," said the committee's lawyer, James Stang, Esq., at Pachulski Stang Ziehl & Jones LLP. The unsecured creditors' committee asked Judge Thuma to set a hearing, "with an opportunity for discovery and briefing" to determine the ownership of the funds. The Wells Fargo accounts were opened, without the Gallup diocese's knowledge, by various parishes and missions associated with parishes within the geographic territory of the diocese using its employer tax identification number. Alleged owners of the accounts cannot access those funds until the diocese gets from them all important information about the funds. Based on the information that the archdiocese has collected, nine of the Wells Fargo accounts are separately owned by non-debtors and in which a total of approximately $260,000 was on deposit at the time the diocese filed for bankruptcy protection. Recently, the diocese discovered one more account at Wells Fargo used by the Our Lady of the Light, a parish in Cubero, New Mexico. It also discovered three other accounts at Pinnacle Bank, of which two are diocesan accounts for Native American Lay Ministry program. The third account is a certificate of deposit owned by St. Francis of Assisi parish in Lumberton, New Mexico, according to a court filing. Mr. Stang can be reached at: James I. Stang, Esq. PACHULSKI STANG ZIEHL & JONES LLP 10100 Santa Monica Boulevard, 13th Floor Los Angeles, CA 90067 Tel: (310) 277-6910 Fax: (310) 201-0760 Email: jstang@pszjlaw.com About the Diocese of Gallup, NM The Diocese of Gallup, New Mexico, principally encompasses American Indian reservations for seven tribes in northwestern New Mexico and northeastern Arizona. It is the poorest diocese in the U.S. There are 38 active priests working in the Diocese and 27 permanent deacons also serve the Diocese along with five seminarians. The Diocese and its missions, schools and ministries employ approximately 50 people, and a significant number of additional people offer their services as volunteers. The diocese sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D. N.M. Case No. 13-bk-13676) on Nov. 12, 2013, in Albuquerque, New Mexico amid suits for sexual abuse committed by priests. The bishop previously said bankruptcy will be "the most merciful and equitable way for the diocese to address its responsibility." The abuse mostly occurred in the 1950s and early 1960s, the bishop said. The petition shows assets and debt both less than $1 million. The Diocese of Gallup is the ninth Catholic diocese to seek protection in Chapter 11 bankruptcy. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DIOCESE OF GALLUP: Pachulski Compensation Criticized ---------------------------------------------------- The Diocese of Gallup has criticized the proposed compensation rates of Pachulski Stang Ziehl & Jones LLP, the law firm tapped by the unsecured creditors' committee to serve as its legal counsel. "The rate structure completely ignores the financial circumstances of the debtor," said the diocese's lawyer, Susan Boswell, Esq., at Quarles & Brady LLP, in Tucson, Arizona. In an application it filed with the U.S. Bankruptcy Court in Mexico, the committee proposed that all Pachulski professionals other than paralegals be paid an hourly rate of $650, plus reimbursement for work-related expenses. While other firms hired by the diocese provided big discounts from their regular hourly rates, Pachulski and the unsecured creditors' committee "do not appear to have taken into account the extreme poverty" of the diocese, according to the diocese's lawyer. About the Diocese of Gallup, NM The Diocese of Gallup, New Mexico, principally encompasses American Indian reservations for seven tribes in northwestern New Mexico and northeastern Arizona. It is the poorest diocese in the U.S. There are 38 active priests working in the Diocese and 27 permanent deacons also serve the Diocese along with five seminarians. The Diocese and its missions, schools and ministries employ approximately 50 people, and a significant number of additional people offer their services as volunteers. The diocese sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D. N.M. Case No. 13-bk-13676) on Nov. 12, 2013, in Albuquerque, New Mexico amid suits for sexual abuse committed by priests. The bishop previously said bankruptcy will be "the most merciful and equitable way for the diocese to address its responsibility." The abuse mostly occurred in the 1950s and early 1960s, the bishop said. The petition shows assets and debt both less than $1 million. The Diocese of Gallup is the ninth Catholic diocese to seek protection in Chapter 11 bankruptcy. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DIOCESE OF GALLUP: St. Bonaventure Indian Mission Sues Diocese -------------------------------------------------------------- Saint Bonaventure Indian Mission and School Inc. has filed a complaint against the Diocese of Gallup, which seeks to bar the diocese from having or claiming any lien upon or title to a real property. The property located in McKinley County, New Mexico, consists of several lots. In 1992, the Diocese of Gallup transferred to Saint Bonaventure title to the real property. In March 2002, Robert O'Connell, former executive director of Saint Bonaventure, allegedly transferred a portion of the property back to the diocese without authorization from Saint Bonaventure's board of directors. The Gallup diocese asserts ownership to some or all of the real property, which Saint Bonaventure claims it owns, according to the complaint filed in U.S. Bankruptcy Court for the District of New Mexico. Saint Bonaventure is represented by: Charles R. Hughson, Esq. RODEY, DICKASON, SLOAN, AKIN & ROBB P.A. P.O. Box 1888 Albuquerque, NM 87103 Tel: (505) 76839 Email: chughson@rodey.com About the Diocese of Gallup, NM The Diocese of Gallup, New Mexico, principally encompasses American Indian reservations for seven tribes in northwestern New Mexico and northeastern Arizona. It is the poorest diocese in the U.S. There are 38 active priests working in the Diocese and 27 permanent deacons also serve the Diocese along with five seminarians. The Diocese and its missions, schools and ministries employ approximately 50 people, and a significant number of additional people offer their services as volunteers. The diocese sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D. N.M. Case No. 13-bk-13676) on Nov. 12, 2013, in Albuquerque, New Mexico amid suits for sexual abuse committed by priests. The bishop previously said bankruptcy will be "the most merciful and equitable way for the diocese to address its responsibility." The abuse mostly occurred in the 1950s and early 1960s, the bishop said. The petition shows assets and debt both less than $1 million. The Diocese of Gallup is the ninth Catholic diocese to seek protection in Chapter 11 bankruptcy. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DIOCESE OF HELENA: Files for Chapter 11 Due to Abuse Claims ----------------------------------------------------------- The Roman Catholic Bishop of Helena, Montana, a Montana Religious Corporation Sole (a/k/a Diocese of Helena) sought protection under Chapter 11 of the Bankruptcy Code on Jan. 31, 2014, to resolve more than 350 sexual-abuse claims. The Chapter 11 case was filed with the U.S. Bankruptcy Court for the District of Montana. Pre-Bankruptcy Settlement with Abuse Claimants The Diocese's Chapter 11 filing follows a nearly 30-month mediation process that resulted to a settlement among the Diocese, its insurers and individuals who filed sexual abuse claims against priests and lay workers of the Diocese. The settlement resolves 362 claims alleging abuses that took place between 30 and 60 years ago. The Diocese said the details of written agreements are still being worked on by the parties. Under the supervision and ultimate approval of the Bankruptcy Court, $15 million would be available to compensate the currently identified victims with additional settlement funds for other and unknown victims. The process of obtaining Bankruptcy Court approval included the opportunity for victims and creditors to vote on the proposed settlement. The Diocese expects that its reorganization will be expedited by the pre-bankruptcy negotiations with all of the affected parties. The majority of the proposed settlement for known and unknown victims will be funded by diocesan insurance carriers. It is anticipated that the Diocese will need to provide at least $2.5 million to fund claims and the costs associated with the Court proceedings. The composite overview of the sexual abuse cases reveals that 12% of the claimants name diocesan priests, 65% name Jesuit priests, 26% name Ursuline Sisters, and a smaller percentage name others who served in the Diocese over the years. The Diocese said negotiations with the Ursuline Sisters were inconclusive and they will not be participating in the current resolution of the cases. The Diocese adds that it has been experiencing a tenuous financial condition which existed prior to, and is not related to the sexual abuse litigation. As a result of the litigation/mediation process, the Diocese's Deposit and Loan fund and other designated funds have deteriorated substantially. This condition has resulted in reduction in staff and services provided by the Diocese as well as curtailing many parish building projects. Abuse Prevention Programs The Diocese has abuse prevention programs in place, including screening and training for employees, volunteers, priests and seminarians. The Diocese has a board to review claims of abuse, whose members include a mother, a pastor, a deputy prosecutor, a retired law enforcement officer, social workers, and a counselor. Bishop's Statement "On behalf of the entire Diocese of Helena, I express my profound sorrow and sincere apologies to anyone who was abused by a priest, a sister, or a lay Church worker," Helena Bishop, George Leo Thomas, said in a news release. "No child should experience harm from anyone who serves in the Church." Bishop Thomas indicated: "I want to assure you that none of those who have been credibly accused remain active in ministry at this time. In fact, the majority of those accused have died." The Bishop also noted that the Diocese has taken responsibility in this matter for claims involving members of religious communities who have served here. Efforts to include the Ursuline Sisters in the proposed settlements were inconclusive and they are not participating in the proposed resolution of this litigation. Bishop Thomas added: "While we may be a poorer Church, we remain unwaveringly committed to promoting the Good News of Jesus Christ. Once the reorganization proceedings conclude, we will be able to plan confidently for future ministry for the people of the Church of the Diocese of Helena." DIOCESE OF HELENA: Case Summary & Top Unsecured Creditors --------------------------------------------------------- Debtor: Roman Catholic Bishop of Helena, Montana, a Montana Religious Corporation Sole (Diocese of Helena) PO BOX 1729 Helena, MT 59624-1729 Case No.: 14-60074 Chapter 11 Petition Date: January 31, 2014 Judge: Hon. Terry Myers Court: United States Bankruptcy Court District of Montana (Butte) Debtor's Counsel: Bruce Alan Anderson, Esq. ELSAESSER, JARZABEK, ET AL. 320 East Neider Avenue, Suite 102 Coeur D'Alene, ID 83815 Tel: 208.667.2900 Fax: 208-667-2150 Email: brucea@ejame.com -- and -- Ford Elsaesser, Esq. ELSAESSER, JARZABEK, et al. PO Box 1049 Sandpoint, ID 83864 Tel: 208-263-8517 Email: ford@ejame.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $10 million to $50 million The petition was signed by Most Reverend George Leo Thomas, Bishop of Diocese of Helena. The Roman Catholic Bishop of Helena, Montana, disclosed that it has two groups of creditors holding unsecured claims: (1) 95 Abuse Claimants, the names and addresses of which are filed under seal. The claim amount is unliquidated, pending settlement subject to Bankruptcy Court approval. The 95 Abuse Claimants may be reached through: Bryan Smith, Esq. Vito de la Cruz, Esq. TAMAKI LAW OFFICES 1340 N. 16th Avenue, Suite C Yakima, WA 98902 Tel: (509)248-8338 (2) 286 Abuse Claimants, the names and addresses of which are filed under seal. The claim amount is unliquidated, pending settlement subject to Bankruptcy Court approval. The 268 Abuse Claimants may be reached through: Milt Datsopoulos, Esq. Molly Howard, Esq. DATSOPOULOS, MACDONALD AND LIND 201 W. Main Street, Suite 201 Missoula, MT 59802 Tel: (406)728-0810 - and - Timothy Kosnoff, Esq. Daniel Fasy, Esq. KOSNOFF FASY, PLLC 520 Pike Street, Suite 1010 Seattle, WA 98101 Tel: (206)257-3590 - and - Joseph Blumel, Esq. LAW OFFICES OF JOSEPH A. BLUMEL, III 4407 N. Division Street, Suite 900 Spokane, WA 99207 Tel: (509)487-1651 - and - Lee James, Esq. Craig Vernon, Esq. JAMES, VERNON AND WEEKS 1626 Lincoln Way Coeur d'Alene, ID 83814 Tel: (206)667-0683 DIOCESE OF HELENA: Judge Myers to Oversee Chapter 11 Case --------------------------------------------------------- The Judicial Council of the Ninth Circuit has ordered the transfer of U.S. Bankruptcy Judge Terry Myers to the District of Montana to oversee the Chapter 11 case of the Roman Catholic Bishop of Helena. The assignment will only be temporary and in addition to Judge Myer's duties in the District of Idaho, according to the order signed by Alex Kozinski, chief judge of the Judicial Council of the Ninth Circuit. About the Diocese of Helena The Roman Catholic Bishop of Helena, Montana, a Montana Religious Corporation Sole (a/k/a Diocese of Helena) sought protection under Chapter 11 of the Bankruptcy Code on Jan. 31, 2014, to resolve more than 350 sexual-abuse claims. The Chapter 11 case (Bankr. D. Mont. Case No. 14-60074) was filed in Butte, Montana. Attorneys at Elsaesser, Jarzabek, et al., serve as counsel to the Debtor. The Debtor estimated assets of $1 million to $10 million and debt of $10 million to $50 million. Several Roman Catholic dioceses in the U.S. have filed for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) DOTS LLC: Hires A&G Realty as Real Estate Consultants ----------------------------------------------------- Dots, LLC and its debtor-affiliates ask for permission from the U.S. Bankruptcy Court for the District of New Jersey to employ A&G Realty Partners, LLC as real estate consultants, effective Jan. 20, 2014. The services to be rendered by A&G Realty are subject to specific direction by the Debtors. As more fully set forth in the Services Agreement, A&G Realty will advise the Debtors with respect to stores that the Debtor determines to close or sell, including valuing such leases, negotiating with landlords over rent reductions, negotiating with landlords over claim reductions or claim waivers and negotiating with landlords with respect to assignment and sale of such leases. All of the services to be provided by A&G Realty will only be provided on an as-needed basis upon the request of the Debtors. Emilio Amendola, principal of A&G Realty, 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. A&G Realty can be reached at: Emilio Amendola A&G REALTY PARTNERS, LLC 445 Broad Hollow Road, Suite 410 Melville, NY 11747 Tel: (631) 465-9507 Fax: (631) 420-4499 E-mail: emilio@agrealtypartners.com About DOTS LLC Dots is a retailer of fashionable clothing, accessories, and footwear for price-conscious women. Dots provides missy and plus size choices to fashion savvy 25 to 35 year old women at approximately 400 retail stores throughout the Midwest, East, and South United States. Dots' workforce includes 3,500 individuals in their stores, distribution center, and corporate headquarters. Dots, LLC, and its affiliates sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 14-11016) on Jan. 20, 2014, to sell some or all of their assets. Lowenstein Sandler LLP serves as counsel to the Debtors. PricewaterhouseCoopers LLP is financial advisor and investment banker. Donlin, Recano & Company, Inc., is the claims and notice agent. As of the Petition Date, the Debtors have outstanding secured debt owed to senior lender Salus Capital Partners, LLC, of which $14.5 million remains outstanding under a revolving facility and $16.1 million is owed under a term facility. The Debtors also have not less than $17 million outstanding under subordinated term loan agreements with Irving Place Capital Partners III L.P. ("IPC) and related entities. Moreover, the Debtors have aggregate unsecured debts of $47.0 million. Salus, the prepetition senior lender and the DIP lender, is represented by Morgan, Lewis & Bockius, LLP. The prepetition subordinated lenders are represented by Okin Hollander & DeLuca, LLP. The Company has arranged to borrow $36 million to keep operating as it reorganizes under court protection. DRYSHIPS INC: Ocean Rig Enters Into Amendment of $1.9BB Term Loan ------------------------------------------------------------------ DryShips Inc., an international provider of marine transportation services for drybulk and petroleum cargoes, and through its majority owned subsidiary, Ocean Rig UDW Inc., of offshore deepwater drilling services, on Feb. 7 disclosed that Ocean Rig, and its wholly-owned subsidiaries, Drillships Financing Holding Inc., and Drillships Projects Inc., have entered into an Amendment and Restatement Agreement to the Credit Agreement dated as of July 12, 2013, as amended, among Ocean Rig, DFHI, Drillships Projects, the lenders from time to time party thereto and Deutsche Bank AG New York Branch, as administrative and collateral agent which originally comprised of tranche B-1 term loans in an aggregate principal amount equal to $1.075 billion and tranche B-2 term loans in an aggregate principal amount equal to $825.0 million. Pursuant to the Amendment and Restatement Agreement, the existing Tranche B-2 Terms Loans have been refinanced with additional new Tranche B-1 Term Loans the result of which is that DFHI currently has approximately $1.9 Billion of Tranche B-1 Term Loans outstanding. All Tranche B-1 Term Loans remain guaranteed by Ocean Rig and by certain existing and future subsidiaries of DFHI and are secured by certain assets, and by a pledge of the stock of DFHI and each subsidiary guarantor. George Economou, Chairman and Chief Executive Officer of the Company, commented: "We are pleased with the successful closing of this important transaction which extends Ocean Rig's debt maturities. We effectively refinanced the short-term tranche of the Term Loan B Facility with a fungible add-on to the long-term tranche. Post transaction, the entire $1.9 billion facility will mature not earlier than the third quarter of 2020." About DryShips Inc. Headquartered in Athens, Greece, DryShips Inc. (NASDAQ: DRYS) is an owner of drybulk carriers and tankers that operate worldwide. Through its majority owned subsidiary, Ocean Rig UDW Inc., DryShips owns and operates 10 offshore ultra deepwater drilling units, comprising of 2 ultra deepwater semisubmersible drilling rigs and 8 ultra deepwater drillships, 3 of which remain to be delivered to Ocean Rig during 2013 and 1 is scheduled for delivery during 2015. DryShips owns a fleet of 46 drybulk carriers (including newbuildings), comprising of 12 Capesize, 28 Panamax, 2 Supramax and 4 Very Large Ore Carriers (VLOC) with a combined deadweight tonnage of about 5.1 million tons, and 10 tankers, comprising 4 Suezmax and 6 Aframax, with a combined deadweight tonnage of over 1.3 million tons. The Company reported a net loss of US$288.6 million on US$1.210 billion of revenues in 2012, compared with a net loss of US$47.3 million on US$1.078 billion of revenues in 2011. The Company's balance sheet at Dec. 31, 2012, showed US$8.878 billion in total assets, US$5.010 billion in total liabilities, and shareholders' equity of US$3.868 billion. Going Concern Doubt Ernst & Young (Hellas), in Athens, Greece, expressed substantial doubt about DryShips Inc.'s ability to continue as a going concern, citing the Company's working capital deficit of US$670 million at Dec. 31, 2012, and in addition, the non- compliance by the shipping segment with certain covenants of its loan agreements with banks. As of Dec. 31, 2012, the shipping segment was not in compliance with certain loan-to-value ratios contained in certain of its loan agreements. In addition, as of Dec. 31, 2012, the shipping segment was in breach of certain financial covenants, mainly the interest coverage ratio, contained in the Company's loan agreements relating to US$769,098,000 of the Company's debt. As a result of this non-compliance and of the cross default provisions contained in all bank loan agreements of the shipping segment and in accordance with guidance related to the classification of obligations that are callable by the creditor, the Company has classified all of its shipping segment's bank loans in breach amounting to US$941,339,000 as current at Dec. 31, 2012. DVORKIN HOLDINGS: Ch. 11 Trustee Hires North Clybourn as Broker --------------------------------------------------------------- Gus A. Paloian, the Chapter 11 trustee of Dvorkin Holdings, LLC, seeks permission from the Hon. Jack B. Schmetterer of the U.S. Bankruptcy Court for the Northern District of Illinois to employ North Clybourn Group, Inc. as real estate broker. The Chapter 11 Trustee also seeks to pay the commission earned by North Clybourn in connection with the sale of the real property identified on the parties' Agreement, without further Court order. The Trustee will retain North Clybourn to market and sell the Real Property. The Real Property currently consists of three commercial or industrial properties with the commonly known street addresses identified in the schedule to the Agreement. The Agreement sets forth the Broker's Commission that will be paid to North Clybourn in connection with the sale of the Real Property, from the proceeds of the sale of such Real Property. The Broker's Commission will consist of: (a) 5% of the gross purchase price of the property sold cooperatively; (b) 3.5% of the gross purchase price if the property is not sold cooperatively; and (c) 3% if the property is sold to an existing tenant. Michelle Brown, senior member of North Clybourn, 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. North Clybourn can be reached at: Michelle Brown NORTH CLYBOURN GROUP, INC. 2324 W. North Avenue Chicago, IL 60647 Tel: (773) 252-0600 ext 7904 Fax: (773) 252-1126 E-mail: michelle@northclybourngroup.com Meanwhile, the Bankruptcy Court was slated to convene a hearing Feb. 10, 2014, to consider the motion filed by Gus A. Paloian, as the Chapter 11 trustee for Dvorkin Holdings, LLC, for approval of an agreed order withdrawing Claim No. 5 filed by Centier Bank. On Nov. 14, 2012, the bank filed a Claim No. 5 in the amount of $979,574, arising from the Debtor's guranty of a promissory note to the bank from 2150 N. Clybourn(Chicago), LLC The bank and the Chapter 11 trustee have agreed to resolve Claim No. 5 by entry of an agreed order pursuant to which (a) Claim No. 5 is withdrawn; and (b) the bank will not file any further claims in the proceedings. About Dvorkin Holdings Dvorkin Holdings, LLC, a holding company that has interests in 40 non-debtor entities, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 12-31336) in Chicago on Aug. 7, 2012. The Debtor disclosed $69,894,843 in assets and $9,296,750 in liabilities as of the Chapter 11 filing. Bankruptcy Judge Jack B. Schmetterer oversees the case. Michael J. Davis, Esq., at Archer Bay, P.A., in Lisle, Ill., serves as counsel to the Debtor. The petition was signed by Loran Eatman, vice president of DH-EK Management Corp. The Bankruptcy Court in October 2012 granted the request of Patrick S. Layng, the U.S. Trustee for the Northern District of Illinois, to appoint Gus Paloian as the Chapter 11 Trustee. Seyfarth Shaw, LLP, represents the Chapter 11 Trustee as counsel. Carpenter Lipps & Leland LLP represents the Chapter 11 Trustee as conflicts counsel. EMPIRE DIE: Creditors' Panel Can Hire Freeborn & Peters as Counsel ------------------------------------------------------------------ The Official Committee of Unsecured Creditors of Empire Die Casting Co., Inc. sought and obtained authorization from the Hon. Marilyn Shea-Stonum of the U.S. Bankruptcy Court for the Northern District of Ohio to retain Freeborn & Peters LLP as counsel, effective Oct. 30, 2013. The Committee required Freeborn & Peters to: (a) advise the Committee on all legal issues as they arise; (b) represent and advise the Committee regarding the term of any sales of assets or plans of reorganization or liquidation, and assist the Committee in negotiations with the Debtor and other parties; (c) investigate the Debtor's assets and pre-bankruptcy conduct; Freeborn & Peters will be paid at these hourly rates: Richard S. Lauter, Partner $585 Thomas R. Fawkes, Partner $505 Devon J. Eggert, Associate $335 Brian J. Jackiw, Associate $285 New Associates $265 Senior Partners $820 Paraprofessionals $150-$280 Freeborn & Peters gave a voluntary 10% discount as courtesy to the Debtor. Freeborn & Peters will also be reimbursed for reasonable out-of- pocket expenses incurred. Richard S. Lauter, partner and the chair of the Bankruptcy and Financial Restructuring Practice Group of Freeborn & Peters, 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. About Empire Die Macedonia, Ohio-based Empire Die Casting Co., Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ohio Case No. 13-52996) on Oct. 16, 2013. The Debtor estimated assets of $10 million to $50 million and liabilities of $1 million to $10 million. The petition was signed by Robert Hopkins, president. The case is before Judge Marilyn Shea-Stonum. The Debtor is represented by Marc B. Merklin, Esq., and Kate M. Bradley, Esq., at Brouse McDowell, LPA, in Akron, Ohio. The Official Committee of Unsecured Creditors is represented by Freeborn & Peters LLP. FirstMerit Bank, N.A. is represented by Scott N. Opincar, Esq., at McDonald Hopkins LLC, in Cleveland, Ohio. EXIDE TECHNOLOGIES: Posts $34MM Net Loss for Fiscal Q3 ------------------------------------------------------ Exide Technologies filed its quarterly report on Form 10-Q for the fiscal third quarter ended Dec. 31, 2013, with the Securities And Exchange Commission on Feb. 7, 2014, a copy of which is available at http://is.gd/Y8lLTU Milton, Georgia-based Exide posted a net loss of $34,477,000 for the third quarter on net sales of $759,666,000; and a net loss of $165,663,000 for the past three quarters on net sales of $2,139,710,000. Total assets at Dec. 31, 2013, were $2,114,460,000, while liabilities not subject to compromise total $1,118,685,000, and liabilities subject to compromise total $972,827,000. Exide received Bankruptcy Court approval for, among other things, access to a $500.0 million Debtor-in-Possession financing facility to supplement cash flows from operations during the reorganization process including the payment of post-petition ordinary course trade and other payables, the payment of certain permitted pre- petition claims, working capital needs, letter of credit requirements, and other general corporate purposes. The DIP Credit Facility contains certain financial covenants. Failure to maintain compliance with these covenants would result in an event of default which would restrict the availability of funds necessary to maintain the Company's operations and assist in funding the Company's reorganization plans. On Sept. 13, 2013, the Bankruptcy Court entered an order, which, among other things, established Oct. 31, 2013, as the general bar date for filing claims and Dec. 9, 2013 as the bar date for claims by certain governmental authorities. The claims bar date order was supplemented by a further order on Oct. 24, 2013, extending the bar date to Jan. 31, 2014, solely with respect to personal injury claims related to the Company's secondary lead recycling facility in Vernon, California. "At this time it is not possible to predict the ultimate effect of the Chapter 11 reorganization on our business, various creditors and security holders, or when it may be possible to emerge from Chapter 11. The Company believes that under any reorganization plan the Company's common stock would likely be substantially diluted or canceled in its entirety. Further, it is also expected that the Company's senior secured notes and convertible senior subordinated notes will suffer substantial impairment," Exide said in the regulatory filing. About Exide Technologies Headquartered in Princeton, New Jersey, Exide Technologies (NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and distributes lead acid batteries and other related electrical energy storage products. Exide first sought Chapter 11 protection (Bankr. Del. Case No. 02-11125) on April 14, 2002 and exited bankruptcy two years after. Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland & Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl & Jones LLP represented the Debtors in their successful restructuring. Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No. 13-11482) on June 10, 2013. Exide disclosed $1.89 billion in assets and $1.14 billion in liabilities as of March 31, 2013. Exide's international operations were not included in the filing and will continue their business operations without supervision from the U.S. courts. For the new case, Exide has tapped Anthony W. Clark, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez & Marsal as financial advisor; Sitrick and Company Inc. as public relations consultant and GCG as claims agent. Schnader Harrison Segal & Lewis LLP was tapped as special counsel. The Official Committee of Unsecured Creditors is represented by Lowenstein Sandler LLP and Morris, Nichols, Arsht & Tunnell LLP as co counsel. Zolfo Cooper, LLC serves as its bankruptcy consultants and financial advisors. Geosyntec Consultants was tapped as environmental consultants to the Committee. Robert J. Keach of the law firm Bernstein Shur as fee examiner has been appointed as fee examiner. F&H ACQUISITION: Feb. 28 Hearing on Global Compromise ----------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware will hold a hearing on Feb. 28, 2014, at 2:00 p.m. ET, to consider the approval of F&H Acquisition Corp., et al., and the Official Committee of Unsecured Creditors' global compromise of controversies in accordance with that certain settlement term sheet. Objections must be filed by Feb. 21, 2014, 4:00 p.m. ET A copy of the Term Sheet is available for free at: http://bankrupt.com/misc/F&HACQUISITIONtermsheet.pdf The settlement embodied in the Term Sheet is a global settlement of all claims and issues between (i) the Committee, and (ii) the Debtors, the postpetition secured lenders and General Electric Capital Corporation as agent, the prepetition first lien lenders and GECC as agent, the prepetition second lien lenders and Cerberus Business Finance, LLC, as agent (including, in such capacity, as the contemplated buyer of substantially all of the Debtors' assets pursuant to the amended sale motion, which resolves all of the Committee's actual and potential objections to, among other things, the amended sale motion and the DIP financing motion. The settlement embodied in the Term Sheet provides for the payment of allowed administrative expense claims based upon estimates provided by the Debtors, avoids potentially costly and lengthy litigation, and provides a funding source for distributions to general unsecured creditors. The Term Sheet provides for: (a) the sale of substantially all of the Debtors' assets to the buyer; (b) the funding of pre-closing administrative expenses incurred in the ordinary course of the Debtors' business, including payment of stub rent claims, as set forth in the revised final order approving the Debtors' postpetition financing; (c) the funding of a wind down budget by the buyer for the purpose of satisfying valid and allowed 503(b)(9) claims and other wind down expenses; (d) an increase of the funds available to pay professional fees incurred by the Committee from that provided under the interim DIP order; (e) the transfer of $500,000 by the buyer to a trust created for the benefit of general unsecured creditors and Committee professionals, or to a segregated account to be maintained by the Debtors pending the potential creation of such a trust; (f) the buyer's acquisition of the Debtors' causes of action as part of the sale of the Debtors' assets; and (g) validation of the Secured Lender Parties' liens and claims and related releases. On Jan. 29, 2014, the Court entered the order extending until Feb. 5, 2014, the Debtors' allowed interim period to use cash collateral and obtain postpetition financing, from Jan. 14, 2014. The Court also extended until Feb. 5 the deadline for the entry of bid procedures order. The hearing on the bid procedures motion was previously required to be completed on Jan. 28, 2014, and the order was previously required to have been entered on Jan. 29, 2014. On Feb. 7, 2014, the Debtors requested that the hearing to consider the approval of the sale procedures be held on Feb. 12, 2014, at 11:00 a.m. (ET). The Debtors also asked the Court to set for Feb. 28, 2014, at 2:00 p.m. (ET) the hearing to consider the sale of substantially all of the Debtors' assets. A copy of the terms of sale is available for free at: http://bankrupt.com/misc/F&HACQUISITIONsaleamended.pdf The total transaction value provided by buyer is in excess of $125 million, including (i) assumption of approximately $70 million of debt under the first lien credit agreement; (ii) assumption of up to approximately $9.6 million of debt under the DIP credit agreement; (iii) rollover of $10 million of debt under the second lien credit agreement; (iv) a partial credit bid of debt under the Second Lien Credit Agreement of $19 million; (v) $14.5 million in cash, of which $4.5 million would be transferred to the Debtors for the purpose of the wind down; and (vi) an estimated $6.7 million in additional assumed liabilities. The purchase price for the assets will be (i) the cash payment as set forth in Section 3.1(b), plus (ii) the assumption of liabilities by buyer at closing, plus (iii) $19 million, to be satisfied in the form of a credit against the prepetition second lien obligations. A copy of the asset purchase agreement is available for free at: http://bankrupt.com/misc/F&HACQUISITIONapa.pdf About Fox and Hound Wichita, Kansas-based F & H Acquisition Corp., et al., owners of the Fox & Hound, Champps, and Bailey's Sports Grille casual dining restaurants, filed a Chapter 11 petition (Bankr. D. Del. Lead Case No. 13-13220) on Dec. 16, 2013, to quickly sell their assets. As of the bankruptcy filing, the Debtors have 101 restaurants located in 27 states and 6,000 employees. Sales decreased by approximately 9 percent over the past two years. The Debtors also experienced significant inflation in commodity prices, energy prices and labor costs. F&H estimated assets in excess of $100 million. According to a court filing, outstanding debt obligations total $119 million, including $68.4 million owing on a first-lien loan with General Electric Capital Corp. as agent. The $11.2 million second-lien obligation has Cerberus Business Finance LLC as agent. Unsecured trade suppliers and landlords are owed $11.2 million. The senior lenders are to provide $9.6 million in financing for the bankruptcy, with $3.5 million on an interim basis. The parent holding company, F&H Acquisition Corp., is based in Wichita, Kansas. The Debtors have tapped Young, Conaway, Stargatt & Taylor, LLP, as local counsel, Olshan Frome Wolosky LLP as general counsel, Imperial Capital LLC as financial advisor, and Epiq Bankruptcy Solutions as claims and noticing agent. FIBERTECH NETWORKS: S&P Affirms B+ CCR & B+ Rating on $51MM Debt ---------------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'B+' corporate credit rating on Fibertech Networks LLC. The outlook is stable. At the same time, S&P also affirmed its 'B+' issue-level rating and '3' recovery rating on the company's proposed $561 million senior secured credit facility, which consists of the upsized $511 million term loan B due 2019 and a $50 million revolving credit facility due 2017. The '3' recovery rating indicates S&P's expectation for meaningful (50% to 70%) recovery in a payment default. "The ratings on Fibertech LLC reflect the company's 'fair' business risk profile and 'aggressive' financial risk profile," said Standard & Poor's credit analyst Michael Weinstein. Key elements of S&P's financial risk assessment are its expectation that company will generate positive FOCF in 2014 and 2015 and that leverage will remain in the 3.5x to 4.5x range longer term. While the company will reach the higher end of the anticipated leverage range following the proposed dividend recap transaction, S&P believes leverage will be around 4x at the end of 2014, a level that is consistent with the corporate credit rating. The stable outlook reflects S&P's expectation that adjusted leverage will decline to about 4x by the end of 2014 from organic EBITDA growth, with FOCF only slightly positive due to elevated capital spending from continued network expansion. Although S&P considers a downgrade unlikely because of the company's long-term contracts, it could lower the rating if increased competition caused a negative pricing inflection for fiber-optic service providers, leading to a substantial decline in margins and sustained cash outflows. For example, S&P believes that a decline in EBITDA margins to the low-50% area with no reduction in spending on growth initiatives would lead to negative FOCF and could prompt a downgrade. Alternatively, if the company issues additional debt for an acquisition, investment, or sponsor distribution that does not have as favorable profit characteristics as its core business, S&P could lower the rating if it believes leverage will be sustained above 5x for an extended period. S&P considers prospects for an upgrade to be limited by the company's private-equity ownership and its assessment of its financial policy as aggressive, including S&P's expectation that debt to EBITDA is not likely to decline below the mid-3x range for a sustained period. FIRST CHURCH OF CHRIST: Foreclosure Sale on March 14 ---------------------------------------------------- Pursuant to an Amended Judgment of Foreclosure and Sale entered on Sept. 12, 2013, in the case, NYCTL 1998-2 TRUST AND THE BANK OF NEW YORK MELLON, AS COLLATERAL AGENT AND CUSTODIAN, Plaintiffs against FIRST CHURCH OF CHRIST, INC., et al Defendant(s), pending before the Supreme Court County of Queens, Kathleen Clifford Gallo, Esq., as referee, will sell at public auction at the Queens County Supreme Courthouse, 88-11 Sutphin Blvd., in Courtroom #25, Jamaica, NY on March 14, 2014, at 10:00 a.m. premises situate, lying and being in the Borough of Queens, County of Queens, New York, known and designated as Block 12276 and Lot 0063 on the Queens County Tax Assessment Map. The premises is also known as 129-12 Guy R Brewer Boulevard, Jamaica, NY. The Trust and BoNY hold a lien on the property in the approximate amount of $22,650.75 plus interest & costs. The Referee, who serves as attorney to the Plaintiffs, may be reached at: Kathleen Clifford Gallo, Esq. PHILLIPS LYTLE LLP 1400 First Federal Plaza Rochester, NY 14614 FREEDOM INDUSTRIES: Faces "Vantap" Suit Over January 2014 Spill --------------------------------------------------------------- Vantap, LLC, d/b/a Vandalia Grill, a West Virginia Limited Liability Company; Georgia Hamra, a West Virginia Resident; John Sarver, d/b/a Mousie's Car Wash, a West Virginia Resident; Nitro Car Care Center, LLC., a West Virginia Limited Liability Company; Carolyn Burdette, a West Virginia Resident; Colors Salon and Boutique, LLC, a West Virginia Limited Liability Company; Crystal Goode, a West Virginia Resident; Michael Manypenny, a West Virginia Resident, on behalf of themselves and all others similarly situated v. Eastman Chemical Company, a Delaware corporation; Freedom Industries, LLC, a West Virginia corporation; West Virginia American Water Corporation, a West Virginia corporation; and, Gary Southern, a West Virginia resident, Case No. 2:14-cv-01374 (S.D. W. Va., January 13, 2014) arises from a spill. On January 9, 2014, about 300,000 West Virginians lost their water supply after the discovery of a spill of a coal processing chemical from a facility owned and operated by Freedom Industries, LLC upstream from the West Virginia-American Water Corp. water treatment plant. Had Freedom Industries LLC not breached its duties under statutory and common law, the leak would have never occurred, the Plaintiffs allege. They add that West Virginia American Water Corp. should have recognized the risk presented by this facility's presence just upstream from their intake, and should have determined what chemicals were being used and assessed the risk they presented to the water supply. Eastman Chemical Company is a Delaware Corporation with its principal place of business in Kingsport, Tennessee. Eastman as the manufacturer and producer of the product bears legal responsibility for damages stemming from the leak of 4-MCHM on January 9, 2014, the Plaintiffs contend. Freedom Industries, LLC, is a West Virginia company with its principal place of business in Kanawha County, West Virginia. Freedom Industries as the operator of the site bears legal responsibility for the leak of 4-MCHM on January 9. West Virginia-American Water Company is a West Virginia Corporation headquartered in Charleston, West Virginia. Gary Southern is a resident of Charleston, West Virginia. He allegedly bears responsibility because of his personal role in directing operations at the facility of Freedom Industries and his ownership interest in the facility, which he sold to Freedom Industries. The Plaintiffs are represented by: Kevin W. Thompson, Esq. David R. Barney, Jr., Esq. THOMPSON BARNEY 2030 Kanawha Boulevard, East Charleston, WV 25661 Telephone: (304) 235-4006 Facsimile: (304) 235-4009 E-mail: kwthompsonwv@gmail.com drbarneywv@gmail.com - and - Van Bunch, Esq. BONNETT FAIRBOURN FRIEDMAN & BALINT PC 2325 E. Camelback Road, Suite 300 Phoenix, AZ 85016 Telephone: (602) 274-1100 Facsimile: (602) 274-1199 E-mail: vbunch@bffb.com - and - P. Rodney Jackson, Esq. LAW OFFICES OF ROD JACKSON 401 5th/3rd Center 700 Virginia Street East Charleston, WV 25301 Telephone: (843) 780-6879 E-mail: prodjackson27@yahoo.com - and - Michael G. Stag, Esq. Sean Cassidy, Esq. Stephen H. Wussow, Esq. Stuart H. Smith, Esq. SMITH STAG 365 Canal Street, Suite 2850 New Orleans, LA 70130 Telephone: (504) 593-9600 Facsimile: (504) 593-9601 E-mail: mstag@smithstag.com scassidy@smithstag.com ssmith@smithstag.com Freedom Industries, LLC is represented in the lawsuit by: Stephen L. Thompson, Esq. BARTH & THOMPSON P. O. Box 129 Charleston, WV 25321-0129 Telephone: (304) 342-7111 Facsimile: (304) 342-6215 E-mail: sthompson@barth-thompson.com About Freedom Industries Freedom Industries Inc., the company connected to a chemical spill that tainted the water supply in West Virginia, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. W.Va. Case No. 14-bk-20017) on Jan. 17, 2014. The case is assigned to Judge Ronald G. Pearson. The Debtor is represented by Mark E Freedlander, Esq., at McGuire Woods LLP, in Pittsburgh, Pennsylvania; and Stephen L. Thompson, Esq., at Barth & Thompson, in Charleston, West Virginia. The Debtor estimated assets and debt of $1 million to $10 million. The petition was signed by Gary Southern, president. GENERAL MOTORS: Steps Up Pickup-Truck Discounts After Weak January ------------------------------------------------------------------ Jeff Bennett, writing for The Wall Street Journal, reported that General Motors Co. is dialing up the discounts on its new Chevrolet Silverado and GM Sierra pickup trucks, offering as much as $7,000 off the list price after sales slumped in January. According to the report, the Presidents Day sale, which started on Feb. 4 and runs through Feb. 28, allows all pickup-truck shoppers to buy at dealer invoice price plus the traditional destination charge and a $150 program fee. GM also is offering as much as a $7,000 discount on a Chevrolet double-cab, six-cylinder All Star edition and the GMC 2014 Sierra 1500 double-cab, the report related. GM spokesman Jim Cain said the pickup incentive was in step with the auto maker's annual Presidents Day sale offerings and the larger discount on the V-6 was a move designed to "raise consumer awareness," the report further related. The incentives come after Silverado's year-over-year January sales dropped 18.4% to 28,926 vehicles, while GMC Sierra's sales fell 13.5% to 11,118, the report added. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. GREEN FIELD: Court OKs Key Employee Incentive & Retention Plans --------------------------------------------------------------- The Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware has approved Green Field Energy Services, Inc., et al.'s key employee incentive plan and key employee retention plan. On Jan. 13, 2014, the Court authorized the Debtors to file the redacted version of the motion for approval of the KEIP and KERP. The Debtors are also authorized to file the unredacted version of the motion under seal. Amounts earned and payable under the KEIP and the KERP will have administrative expense priority; provided, however, that the administrative expenses claim will be junior to those superpriority claims of the DIP lenders. The financial advisor of the Committee, Conway MacKenzie, is authorized to consult with the Debtors' independent director, Brent Kugman, as and when Conway determines is appropriate through the closing of a sale of substantially all of the Debtors' assets to ensure that the KEIP recipients are adequately performing their employment duties. In addition, Conway will have a fair and reasonable opportunity to monitor management's involvement in the sale process. On Jan. 8, 2014, the Debtors said in a filing in response to the U.S. Trustee's objection to the approval of the KEIP and KERP that only the U.S. Trustee, a party with no economic interest in these Chapter 11 cases, has objected. "Implementation of the KEIP and the KERP are necessary to maximize the value of the Debtors' estates for the benefit of all stakeholders. The proposed KEIP is specifically designed to incentivize senior management to work to obtain the greatest possible recovery for stakeholders from the sale of substantially all of the Debtors' assets. In order to achieve the KEIP targets, senior management will take-on significant additional duties related to the asset sale, including responding to diligence requests and continuing to perform their day-to-day job functions. The KERP is designed to retain those non-insider employees who perform duties necessary to maintain the business through the completion of an asset sale," the Debtors stated. The U.S. Trustee claimed that the KEIP is a disguised retention plan that does not satisfy the Bankruptcy Code Section 503(c)(1) or, in the alternative, the KEIP and KERP are not justified by the facts and circumstances as required under Bankruptcy Code Section 503(c)(3). The Debtors insisted in its Jan. 8 court filing that the KEIP is a true incentive plan, not a retention plan, and is therefore not subject to the requirements of Bankruptcy Code Section 503(c)(1). About Green Field Energy Green Field Energy Services, Inc., is an independent oilfield services company that provides a wide range of services to oil and natural gas drilling and production companies to help develop and enhance the production of hydrocarbons. The Company's services include hydraulic fracturing, cementing, coiled tubing, pressure pumping, acidizing and other pumping services. Green Field Energy and two affiliates filed Chapter 11 petitions in Delaware on Oct. 27, 2013, after defaulting on an $80 million credit provided by an affiliate of Royal Dutch Shell Plc (Bankr. D. Del. Case No. 13-12783). The Debtors are represented by Josef S. Athanas, Esq., Caroline A. Reckler, Esq., Sarah E. Barr, Esq., and Matthew L. Warren, Esq., at Latham & Watkins LLP, in Chicago, Illinois; and Michael R. Nestor, Esq., and Kara Hammon Coyle, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware. The Debtors' investment banker is Carl Marks Advisory Group LLC. Thomas E. Hill, from Alvarez & Marsal North America, LLC, serves as the Debtors' chief restructuring officer. In its schedules, Green Field disclosed $306,960,039 in total assets and $447,199,869 in total liabilities. The official committee of unsecured creditors appointed in the case has retained Robert J. Stark, Esq., Howard L. Siegel, Esq., and Sunni P. Beville, Esq., at Brown Rudnick LLP as co-counsel; Steven K. Kortanek, Esq., Kevin J. Mangan, Esq., and Morgan Seward, Esq., at Womble Carlyle Sandridge & Rice, LLP as Delaware co-counsel; and Conway MacKenzie, Inc. as financial advisor. Green Field's bankruptcy is being financed with a $30 million loan from BG Credit Partners LLC and ICON Capital LLC. Steven A. Felsenthal, the court-appointed examiner tapped to employ Stutzman, Bromberg, Esserman & Plifka as his counsel. GREEN MOUNTAIN: S&P Puts 'BB-' CCR on CreditWatch Positive ---------------------------------------------------------- Standard & Poor's Ratings Services placed its 'BB-' corporate credit rating and issue-level ratings on Waterbury, Vt.-based Green Mountain Coffee Roasters Inc. (GMCR) on CreditWatch with positive implications, meaning that S&P could either raise or affirm the ratings upon completion of our review. "The CreditWatch placement follows GMCR's announcement that it has entered into a strategic collaboration agreement with The Coca- Cola Company to jointly develop and market Coca-Cola products for use in the company's new cold beverage system to be launched during GMCR's calendar 2015," said Standard & Poor's credit analyst Bea Chiem. S&P believes that this partnership with Coca-Cola, a global partner with leading shares in the liquid refreshment beverage category, will improve S&P's assessment of GMCR's business risk profile because it will result in greater product and geographic diversity and improved competitive advantage with participation in new and larger carbonated soft drink and cold beverage categories. S&P will seek to resolve the CreditWatch listing following its review of the potential impact on the company's business risk as a result of this new partnership. GROUP UNITED: Panama Canal Expansion Suspended ---------------------------------------------- David Roman, writing for The Wall Street Journal, reported that a consortium in charge of expanding the Panama Canal said on Feb. 7 that work on the $3.1 billion project has been suspended, pending a response from the Panamanian authorities on its latest proposal to share cost overruns. According to the report, in a statement to Spain's stock market regulator, the GUPC consortium said it remains committed to finding a solution to the conflict with Panama's Canal Authority. But it added that the Authority has so far refused to take on extra costs incurred during the project. The statement -- filed by Madrid-based construction firm Sacyr SA, the leading company in the consortium -- is the latest development in a conflict triggered last month when GUPC set a deadline for the Authority to contribute extra funds to the project, the report said. The deadline has since been postponed, but discussions remain focused on $1.6 billion in overruns, the report related. A Miami- based arbitration court will have the final word on a series of small cases on unexpected costs, referring to the expense on the concrete used and the delays caused by events such as bad weather and labor strikes. But the parties disagree on who will pay for the remaining work, before the arbitration court decides on their disputing claims. Panama says it is already paid some funds in advance, so GUPC must put up any additional funds needed to complete the work as signed, the report further related. GUPC, meanwhile, says Panama must keep paying installments agreed on the original contract, on top of the funds delivered in advance, to ensure that the work will be completed by 2015. GSP GROUP: PE Firm Revives 'Mafia' Defamation Claims in Sale Row ---------------------------------------------------------------- Law360 reported that Black Diamond Capital Management LLC has sought to revive its Mafia-themed defamation accusations in a lawsuit stemming from the now-resolved bankruptcy of investment management firm GSC Group Inc., telling a New York appeals court the statement at issue was clearly directed at the private equity firm. According to the report, in oral arguments before an intermediate appellate court in Manhattan, Black Diamond took issue on a quote GSC's minority lenders gave to a news reporter that allegedly compared it to the Corleone family from the classic book and film "The Godfather." About GSC Group Florham Park, New Jersey-based GSC Group, Inc. -- http://www.gsc.com/-- was a private equity firm that specialized in mezzanine and fund of fund investments. Originally named Greenwich Street Capital Partners Inc. when it was a subsidiary of Travelers Group Inc., GSC became independent in 1998 and at one time had $28 billion of assets under management. Market reverses, termination of some funds, and withdrawal of customers' investments reduced funds under management at the time of bankruptcy to $8.4 billion. GSC Group, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 10-14653) on Aug. 31, 2010, estimating assets at $1 million to $10 million and debts at $100 million to $500 million as of the Chapter 11 filing. Effective Jan. 7, 2011, James L. Garrity Jr., was named Chapter 11 trustee for the Debtors. The Chapter 11 trustee completed the sale of business in July 2011 and filed a liquidating Chapter 11 plan and explanatory disclosure statement in late August. The bankruptcy court authorized the trustee to sell the business to Black Diamond Capital Finance LLC, as agent for the secured lenders. Proceeds were used to pay secured claims. The price paid by the lenders' agent was designed for full payment on $256.8 million in secured claims, with $18.6 million cash left over. Black Diamond bought most assets with a $224 million credit bid, a $6.7 million note, $5 million cash, and debt assumption. A minority group of secured lenders filed an appeal from the order allowing the sale. Through a suit in state court, the minority lenders failed to halt Black Diamond from completing the sale. The Chapter 11 Trustee and Black Diamond filed rival repayment plans for GSC Group. The Chapter 11 trustee reached a handshake deal on Dec. 13, 2011, ending the dispute with Black Diamond that delayed a $235 million asset sale. Michael B. Solow, Esq., at Kaye Scholer LLP, served as the Debtor's bankruptcy counsel. Epiq Bankruptcy Solutions, LLC, was the Debtor's notice and claims agent. Capstone Advisory Group LLC served as the Debtor's financial advisor. The Chapter 11 trustee tapped Shearman & Sterling LLP as his counsel, and Togut, Segal & Segal LLP as his conflicts counsel. Black Diamond Capital Management, LLC, is represented by attorneys at Latham & Watkins and Kirkland & Ellis LLP. HARRISBURG, PA: Receivership Could be Over by Spring, Mayor Says ---------------------------------------------------------------- Michael Hyland of Fox43 News reports that Harrisburg Mayor Eric Papenfuse said the state could move to begin the process of bringing the city out of receivership. Gov. Tom Corbett (R) declared the city to be in a fiscal emergency in October 2011. In the time since, two receivers have worked to bring the city out of debt. That culminated with Maj. Gen. William Lynch's creation of the Harrisburg Strong Plan last year, according to Fox43 News. The Pa. Department of Community and Economic Development (DCED), through the Office of General Counsel, is expected to file paperwork in Commonwealth Court to begin the process, the report notes. The report relates that the governor would lift the fiscal emergency declaration. If the judge approves the proposal, a coordinator would be appointed within DCED to continue working with the city to implement the Strong Plan, the report says. Mayor Papenfuse said it's possible the city could be out of receivership by late February or early March. Mayor Papenfuse said he does not expect Gen. Lynch to continue to work with the city. However, Mayor Papenfuse pointed out the team that helped Lynch craft the Strong Plan will remain, the report relates. Harrisburg would remain under Act 47 and still be considered a distressed city, the report relates. About Harrisburg, Pennsylvania The city of Harrisburg, in Pennsylvania, is coping with debt related to a failed revamp of an incinerator. The city is $65 million in default on $242 million owing on bonds sold to finance an incinerator that converts trash to energy. The Harrisburg city council voted 4-3 on Oct. 11, 2011, to authorize the filing of a Chapter 9 municipal bankruptcy (Bankr. M.D. Pa. Case No. 11-06938). The city claims to be insolvent, unable to pay its debt and in imminent danger of having tax revenue seized by holders of defaulted bonds. Judge Mary D. France presided over the Chapter 9 case. Mark D. Schwartz, Esq. and David A. Gradwohl, Esq., served as Harrisburg's counsel. The petition estimated $100 million to $500 million in assets and debts. Susan Wilson, the city's chairperson on Budget and Finance, signed the petition. Harrisburg said in court papers it is in imminent jeopardy through six pending legal actions by creditors with respect to a number of outstanding bond issues relating to the Harrisburg Materials, Energy, Recycling and Recovery Facilities, which processes waste into steam and electrical energy. The owner and operator of the incinerator is The Harrisburg Authority, which is unable to pay the bond issues. The city is the primary guarantor under each bond issue. The lawsuits were filed by Dauphin County, where Harrisburg is located, Joseph and Jacalyn Lahr, TD Bank N.A., and Covanta Harrisburg Inc. The Commonwealth of Pennsylvania, the County of Dauphin, and Harrisburg city mayor Linda D. Thompson and other creditors and interested parties objected to the Chapter 9 petition. The state later adopted a new law allowing the governor to appoint a receiver. Kenneth W. Lee, Esq., Christopher E. Fisher, Esq., Beverly Weiss Manne, Esq., and Michael A. Shiner, Esq., at Tucker Arensberg, P.C., represented Mayor Thompson in the Chapter 9 case. Counsel to the Commonwealth of Pennsylvania was Neal D. Colton, Esq., Jeffrey G. Weil, Esq., Eric L. Scherling, Esq., at Cozen O'Connor. In November 2011, the Bankruptcy Judge dismissed the Chapter 9 case because (1) the City Council did not have the authority under the Optional Third Class City Charter Law and the Third Class City Code to commence a bankruptcy case on behalf of Harrisburg and (2) the City was not specifically authorized under state law to be a debtor under Chapter 9 as required by 11 U.S.C. Sec. 109(c)(2). Dismissal of the Chapter 9 petition was upheld in a U.S. District Court. That same month, the state governor appointed David Unkovic as receiver for Harrisburg. Mr. Unkovic is represented by the Municipal Recovery & Restructuring group of McKenna Long & Aldridge LLP, led by Keith Mason, Esq., co-chair of the group. Mr. Unkovic resigned as receiver March 30, 2012. Mr. Unkovic was replaced by William Lynch as receiver. HDOS ENTERPRISES: Can Use Cash Collateral Until March 20 -------------------------------------------------------- Judge Neil W. Bason of the U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, gave interim authority for HDOS Enterprises to use cash collateral securing its prepetition indebtedness. The interim order came after the Debtor entered into a stipulation with its secured creditor, Torrey Pines Bank. A final hearing on the use of cash collateral will be held on March 20, 2014, commencing at 1:00 p.m., or as soon thereafter as counsel may be heard in Courtroom 1545 of the Roybal Federal Building. About Hot Dog On A Stick Established in 1946 in Southern California, Hot Dog On A Stick -- http://www.hotdogonastick.com-- is known for its fair-inspired menu of corn dogs, lemonades, and a sampling of other menu items such as cheese on a stick, hot dog in a bun, fries, and funnel cake sticks. HDOS is owned by its employees. HDOS Enterprises sought protection under Chapter 11 of the Bankruptcy Code on Feb. 3, 2014 (Case No. 14-12028, Bankr. C.D. Cal.). The case is assigned to Judge Neil W. Bason. The Debtor's counsel is represented by Jerome Bennett Friedman, Esq., Stephen F. Biegenzahn, Esq. -- sbiegenzahn@jbflawfirm.com -- and Michael D. Sobkowiak, Esq. -- msobkowiak@jbflawfirm.com -- at FRIEDMAN LAW GROUP, P.C., in Los Angeles, California. The Debtor has estimated assets ranging from $10 million to $50 million and estimated debts ranging from $1 million to $10 million. The petition was signed by Dan Smith, president and CEO. HDOS ENTERPRISES: Sec. 341(a) Meeting of Creditors Set for March 7 ------------------------------------------------------------------ The U.S. Trustee for Region 16 will hold a meeting of creditors of HDOS Enterprises pursuant to Section 341(a) of the Bankruptcy Code on March 7, 2014, at 1:15 p.m., at RM 7, 915 Wilshire Blvd., 10th Floor, in Los Angeles, California. This is the first meeting of creditors under Section 341(a) of the Bankruptcy Code. The meeting offers creditors a one-time opportunity to examine the Debtors' representative under oath about the Debtors' financial affairs and operations that would be of interest to the general body of creditors. Attendance by the Debtor's creditors at the meeting is welcome, but not required. The meeting may be continued and concluded at a later date specified in a notice filed with the U.S. Bankruptcy Court for the Central District of California, Los Angeles Division. About Hot Dog On A Stick Established in 1946 in Southern California, Hot Dog On A Stick -- http://www.hotdogonastick.com-- is known for its fair-inspired menu of corn dogs, lemonades, and a sampling of other menu items such as cheese on a stick, hot dog in a bun, fries, and funnel cake sticks. HDOS is owned by its employees. HDOS Enterprises sought protection under Chapter 11 of the Bankruptcy Code on Feb. 3, 2014 (Bankr. C.D. Cal. Case No. 14- 12028). The case is assigned to Judge Neil W. Bason. The Debtor's counsel is represented by Jerome Bennett Friedman, Esq., Stephen F. Biegenzahn, Esq. -- sbiegenzahn@jbflawfirm.com -- and Michael D. Sobkowiak, Esq. -- msobkowiak@jbflawfirm.com -- at Friedman Law Group, P.C., in Los Angeles, California. The Debtor has estimated assets ranging from $10 million to $50 million and estimated debts ranging from $1 million to $10 million. The petition was signed by Dan Smith, president and CEO. HDOS ENTERPRISES: Has Interim Authority to Pay Critical Vendors --------------------------------------------------------------- Judge Neil W. Bason of the U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, gave interim authority for HDOS Enterprises to pay prepetition claims of certain critical vendors to the extent that the contemplated payments are made in the ordinary course of the Debtor's business, with any further payments subject to review at a continued hearing set for March 20, 2014, at 1:00 p.m. The Debtors sought authority to pay its main supplier, Shamrock Foods Company, for 20 days' worth of its prepetition claim, which the Debtor estimates to be approximately $200,000. The Debtor also sought authority to pay all credit card processing fees and chargebacks owed prepetition to its credit card processors. The Debtor estimates the prepetition processing fees to be $31,200 and expects the chargebacks to be de minimus, especially in comparison to the value to the Chapter 11 estate of continuing to accept payment by credit card in an uninterrupted fashion. All objections to the motion, if any, will be heard on the March 20 hearing. About Hot Dog On A Stick Established in 1946 in Southern California, Hot Dog On A Stick -- http://www.hotdogonastick.com-- is known for its fair-inspired menu of corn dogs, lemonades, and a sampling of other menu items such as cheese on a stick, hot dog in a bun, fries, and funnel cake sticks. HDOS is owned by its employees. HDOS Enterprises sought protection under Chapter 11 of the Bankruptcy Code on Feb. 3, 2014 (Case No. 14-12028, Bankr. C.D. Cal.). The case is assigned to Judge Neil W. Bason. The Debtor's counsel is represented by Jerome Bennett Friedman, Esq., Stephen F. Biegenzahn, Esq. -- sbiegenzahn@jbflawfirm.com -- and Michael D. Sobkowiak, Esq. -- msobkowiak@jbflawfirm.com -- at FRIEDMAN LAW GROUP, P.C., in Los Angeles, California. The Debtor has estimated assets ranging from $10 million to $50 million and estimated debts ranging from $1 million to $10 million. The petition was signed by Dan Smith, president and CEO. HDOS ENTERPRISES: Seeks to Reject Leases for 16 Stores ------------------------------------------------------ HDOS Enterprises seeks authority from Judge Neil W. Bason of the U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, to reject 16 unexpired leases immediately. Among the leases, 10 apply to stores which are materially underperforming; and have been for quite for some time before the Chapter 11 case was commenced. The other six leases relate to stores closed prior to the Debtor initiating the Chapter 11 case. Each of the 16 leases is "burdensome," the Debtor states in court papers. The 16 lease affected are the following: Landlord Store -------- ----- Simon Westminster Mall Carlyle Group Metro Center, AZ Stone Bros. & Assoc. Shewood Mall Macerich Fiesta (AZ) Forest City Simi Valley Cushman Wakefield Paradise Valley (AZ) Simon Aurora Denver JLL QKC Maui Glimcher Lloyd Center (Portland) Terramar Encinitas Legacy Mgt. West Valley Klann, LP Catering Westfield Horton Westfield Galleria at Roseville Westfield Mission Valley JLL Serramonte Center According to the Debtor, it is agreed and understood that as soon as practicable after the motion has been granted, the Debtor will remove its equipment and inventory; will return the affected stores to "broom clean" condition; and will turn over the keys of stores to the respective landlord or its agent. About Hot Dog On A Stick Established in 1946 in Southern California, Hot Dog On A Stick -- http://www.hotdogonastick.com-- is known for its fair-inspired menu of corn dogs, lemonades, and a sampling of other menu items such as cheese on a stick, hot dog in a bun, fries, and funnel cake sticks. HDOS is owned by its employees. HDOS Enterprises, owner of the Hot Dog On A Stick business, sought protection under Chapter 11 of the Bankruptcy Code on Feb. 3, 2014 (Bankr. C.D. Cal. Case No. 14-12028). The company currently operates 93 locations and plans to continue business as usual during the bankruptcy proceedings. The case is assigned to Judge Neil W. Bason. The Debtor's counsel is represented by Jerome Bennett Friedman, Esq., Stephen F. Biegenzahn, Esq. -- sbiegenzahn@jbflawfirm.com -- and Michael D. Sobkowiak, Esq. -- msobkowiak@jbflawfirm.com -- at Friedman Law Group, P.C., in Los Angeles, California. The Debtor has estimated assets ranging from $10 million to $50 million and estimated debts ranging from $1 million to $10 million. The petition was signed by Dan Smith, president and CEO. HEENAN BLAIKIE: Closes, Lawyers Seek New Homes ---------------------------------------------- Lawyers from law firm Heenan Blaikie LLP are rushing to form new ventures and negotiate mergers following the announcement that the firm, once one of Canada's biggest, is closing the doors, Canada's Globe and Mail reported. U.S. giant DLA Piper -- the world's largest law firm -- confirmed on Feb. 6 it is in talks with a core group of 60 to 70 lawyers from the Toronto and Calgary offices of Heenan with the goal of gaining a toehold in the Canadian market, Daily Bankruptcy Review said. Roger Meltzer, who serves as DLA Piper's co-chairman for the Americas, told ABA Journal that the firm is talking with a group that includes 25 to 30 partners with expertise in banking, corporate and litigation, among other practices. The ABA Journal related that an attorney exodus began from the storied Canadian firm after it announced that partner pay would drop by 10 to 15 percent. The departure of dozens of lawyers made headlines on Feb. 5, and more news followed Heenan Blaikie's announcement that evening its partners had voted to dissolve, although a number of offices and practice groups would form their own firms. "I can tell you about one," Vancouver partner Geoff Plant, a former attorney general for British Columbia, told the Vancouver Sun on Feb. 5. "Sixteen lawyers from the Vancouver office will be announcing the creation of a new firm called Gall, Legge, Grant and Munroe." On Feb. 6, the partners of Gall, Legge, Grant & Munroe announced the establishment of British Columbia's newest law firm. The firm focuses on litigation, labour, employment and public law. Founding partners are Peter Gall, Q.C., Andrea Zwack, and Jillian Frank. The firm will include Heenan Blaikie LLP founder Roy L. Heenan, O.C., Ad.E., former Supreme Court of Canada Justice Michel Bastarache, C.C., former BC Attorney General Geoff Plant, Q.C., former BC Labour Relations Board Chair and arbitrator Donald R. Munroe, Q.C., sports industry legend and Harvard Law School graduate Brian P. Burke, and leading UBC constitutional law professor Robin Elliott, Q.C. HOSPITALITY STAFFING: Feb. 24 Hearing on Severance Benefits ----------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware will convene a hearing on Feb. 24, 2014, at 2:00 p.m., to consider HSS Holding, LLC, et al.'s motion authorizing payment of severance benefits to certain employees. Objections, if any, are due Feb. 17, 2014, at 4:00 p.m. The Debtors relates that Section 9.1 of the asset purchase agreement with HS Solutions Corporation provides that the "Buyer shall offer employment to substantially all employees as of the closing date;" however, the Buyer is not required to hire any employee for any period of time after the closing. Consistent with the APA, the Buyer offered employment to the majority of the Debtors' 6,700 employees. Unfortunately, 27 of the Debtors' management-level employees were left out. The Debtors do not have a formal severance program and did not seek authority to pay severance benefits at the onset of the case. Still, for the critical reasons, the Debtors sought to pay severance benefits to the employees in an amount equal to three weeks of normal weekly wages, less any standard deductions; provided, however, that such severance benefits will not exceed $91,000 in the aggregate. The Debtors said the bonuses will not be paid out for the employees and the severance benefits will not include any amounts owed for sick leave, vacation or other types of paid time off benefits. The Buyer and DIP Lender have consented to the Debtors' payment of the severance benefits to the employees and the DIP Lender has funded the amount necessary to pay the severance benefits, if approved. The Debtors noted that a vice president of human resources for the Debtors is included in the list of employees. The VP of Human Resources is an officer of the Debtors in title only and does not partake in making operational or strategic decisions or otherwise participate in the management of the Debtors' businesses so as to be an "insider" for purposes of Bankruptcy Code sections 101(31) or 503(c). About Hospitality Staffing Solutions Hospitality Staffing Solutions, LLC (HSS) -- http://www.hssstaffing.com-- is a hospitality staffing company. Established in 1990, the company's team of hotel industry experts works with 4 and 5 star properties in 35 states and 62 markets across the country. Hospitality Staffing Solutions and various affiliates filed voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 13-12740) on Oct. 24, 2013, before Judge Brendan Linehan Shannon. The Debtors are represented by Mark Minuti, Esq., at Saul Ewing LLP, in Wilmington, Delaware; and Jeffrey C. Hampton, Esq., Monique Bair DiSabatino, Esq., and Ryan B. White, Esq., at Saul Ewing LLP, in Philadelphia, Pennsylvania. The Debtors' financial advisor is Conway Mackenzie, Inc., and their investment banker is Duff & Phelps Corp. Epiq Systems, Inc., is the Debtors' claims and noticing agent. HSS Holding disclosed assets of undetermined amount and liabilities of $22,910,994. The investor group is providing DIP financing. They are represented by Scott K. Charles, Esq., and Neil M. Snyder, Esq., at Wachtell, Lipton, Rosen & Katz, in New York; and Derek C. Abbott, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Delaware. Roberta A. DeAngelis, U.S. Trustee for Region 3, has notified the Bankruptcy Court that she was unable to appoint a committee of unsecured creditors in the Debtors' cases as there was insufficient response to the U.S. Trustee communication/contact for service on the committee. The Debtors filed for bankruptcy to facilitate a sale of the business to HS Solutions Corporation, an entity formed by LJC Investments I, LLC and a group of investors including Littlejohn Opportunities Master Fund, L.P., Caymus Equity Partners and Management, and SG Distressed Debt Fund LP. The investor group acquired $22.9 million of the secured bank debt on Oct. 11, 2013. That debt is in default. The asset purchase agreement with HS Solutions was approved by the Court on Dec. 13, 2014. The sale closed on Jan. 24, 2014. HOSPITALITY STAFFING: Wants to Change Case Caption Following Sale ----------------------------------------------------------------- HSS Holding, LLC, et al., ask the U.S. Bankruptcy Court for the District of Delaware for permission to revise the caption for their bankruptcy cases to reflect their new legal names. The Debtors relate that the change is pursuant to the terms of the asset purchase agreement for the sale of substantially all of the Debtors' assets which closed on Jan. 24, 2014. The name changes are: Former Debtor Names New Debtor Names ------------------- ---------------- HSS Holdings, LLC Hospitality Liquidation I, LLC Hospitality Staffing Solutions Group, LLC Hospitality Liquidation II, LLC Hospitality Staffing Solutions, LLC Hospitality Liquidation III, LLC IHS Staffing Services, LLC Hospitality IV, LLC IHS Hospitality Services, LLC Hospitality Liquidation V, LLC Hospitality Staffing Solutions of Louisiana, L.L.C. Hospitality Liquidation VI, LLC Hospitality Staffing Solutions of Iowa, LLC Hospitality Liquidation VII, LLC Hospitality Staffing Solutions of Connecticut, LLC Hospitality Liquidation VIII, LLC Hospitality Staffing Solutions of Indiana, LLC Hospitality Liquidation IX, LLC Hospitality Staffing Solutions of Illinois, LLC Hospitality Liquidation X, LLC In addition, the Debtors intend to file a notice of legal name change in the cases to ensure that all creditors and parties-in- interest are aware of the Debtors' new names. The Debtors propose a hearing on Feb. 24, 2014, at 2:00 p.m., to consider the matter. Objections, if any, are due Feb. 17 at 4:00 p.m. About Hospitality Staffing Solutions Hospitality Staffing Solutions, LLC (HSS) -- http://www.hssstaffing.com-- is a hospitality staffing company. Established in 1990, the company's team of hotel industry experts works with 4 and 5 star properties in 35 states and 62 markets across the country. Hospitality Staffing Solutions and various affiliates filed voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 13-12740) on Oct. 24, 2013, before Judge Brendan Linehan Shannon. The Debtors are represented by Mark Minuti, Esq., at Saul Ewing LLP, in Wilmington, Delaware; and Jeffrey C. Hampton, Esq., Monique Bair DiSabatino, Esq., and Ryan B. White, Esq., at Saul Ewing LLP, in Philadelphia, Pennsylvania. The Debtors' financial advisor is Conway Mackenzie, Inc., and their investment banker is Duff & Phelps Corp. Epiq Systems, Inc., is the Debtors' claims and noticing agent. HSS Holding disclosed assets of undetermined amount and liabilities of $22,910,994. The investor group is providing DIP financing. They are represented by Scott K. Charles, Esq., and Neil M. Snyder, Esq., at Wachtell, Lipton, Rosen & Katz, in New York; and Derek C. Abbott, Esq., at Morris, Nichols, Arsht & Tunnell LLP, in Wilmington, Delaware. Roberta A. DeAngelis, U.S. Trustee for Region 3, has notified the Bankruptcy Court that she was unable to appoint a committee of unsecured creditors in the Debtors' cases as there was insufficient response to the U.S. Trustee communication/contact for service on the committee. The Debtors filed for bankruptcy to facilitate a sale of the business to HS Solutions Corporation, an entity formed by LJC Investments I, LLC and a group of investors including Littlejohn Opportunities Master Fund, L.P., Caymus Equity Partners and Management, and SG Distressed Debt Fund LP. The investor group acquired $22.9 million of the secured bank debt on Oct. 11, 2013. That debt is in default. The asset purchase agreement with HS Solutions was approved by the Court on Dec. 13, 2014. The sale closed on Jan. 24, 2014. JAMES RIVER: Mulls Sale, Other Alternatives ------------------------------------------- John Kell, writing for The Wall Street Journal, reported that James River Coal Co. said it has tapped advisors to help the coal mining company explore a potential sale and other strategic alternatives. According to the report, shares slumped 16% to 62 cents in after- hours trading on Feb. 7. The stock, which has languished for years, briefly traded over $60 at its peak in 2008. The company, which sells coal to electric utilities and industrial customers, has reported wider losses, idled coal production and furloughed jobs as utilities increasingly favor cheaper natural gas to thermal coal, the report related. Meanwhile, metallurgical-coal prices have suffered as an uncertain economy keeps a lid on demand. On Feb. 7, James Coal said it is evaluating several options, which could include a capital investment through debt or equity, or a sale of all or one or more portions of the company, the report further related. The company has named Perella Weinberg Partners LP has restructuring advisor, Deutsche Bank AG as merger and acquisitions advisor, and Davis Polk & Wardwell LLP to provide legal advice. About James River Headquartered in Richmond, Virginia, James River Coal Company (NasdaqGM: JRCC) -- http://www.jamesrivercoal.com/-- mines, processes and sells bituminous steam and industrial-grade coal primarily to electric utility companies and industrial customers. The company's mining operations are managed through six operating subsidiaries located throughout eastern Kentucky and in southern Indiana. For the nine months ended Sept. 30, 2013, the Company reported a net loss of $14.99 million. James River reported a net loss of $138.90 million in 2012, as compared with a net loss of $39.08 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $1.06 billion in total assets, $818.69 million in total liabilities and $247.34 million in total shareholders' equity. * * * In the May 24, 2013, edition of the TCR, Moody's Investors Service downgraded James River Coal Company's Corporate Family Rating to Caa2 from Caa1. "While the company continues to take actions to reposition operations and shore up its balance sheet, we expect external factors will preclude James River from maintaining credit measures and liquidity consistent with the Caa1 rating level," said Ben Nelson, Moody's lead analyst for James River Coal Company. As reported by the TCR on Nov. 19, 2012, Standard & Poor's Ratings Services raised its corporate credit rating on Richmond, Va.-based James River Coal Co. to 'CCC' from 'SD' (selective default). "We raised our rating on James River Coal because we understand that the company has stopped repurchasing its debt at deep discounts, for the time being," said credit analyst Megan Johnston. KINDE DURKEE: Liquidators Recover Only $94,000 From Theft --------------------------------------------------------- Patrick McGreevy, writing for the Los Angeles Times, reports that more than a year after campaign treasurer Kinde Durkee was ordered to repay $10.5 million she embezzled from the accounts of dozens of politicians, including U.S. Sen. Dianne Feinstein; federal officials said they have only been able to recover $94,469 from liquidation of her assets to go to restitution. The report says that in November 2012, Ms. Durkee was sentenced to eight years in federal prison and ordered to repay the money she stole from 77 victims, mostly politicians from California, including the campaign committees of Feinstein and Democratic Reps. Laura Richardson of Long Beach, Loretta Sanchez of Garden Grove and Susan A. Davis of San Diego, according to Los Angeles Times. The report notes that federal prosecutors allege that Ms. Durkee used money from clients' accounts to pay for Disneyland tickets, ice cream and other expenses billed to her credit cards, as well as to pay her mortgage and for residential care for a relative and office expenses to keep her failing business afloat. Ms. Feinstein's campaign committees lost the most, at least US$4.5 million, according to the court filings, the reports notes. Federal officials liquidated Ms. Durkee's retirement account and sold her Burbank office building but have come up with less than US$100,000, according to Lauren Horwood, a spokeswoman for the U.S. attorney's office, the report discloses. The report relates that Justin Berger, an attorney for Feinstein's campaign committees, said his law firm is still pursuing financial claims against the bank Ms. Durkee used, but he was not shocked that the liquidation of Ms. Durkee's assets have yielded a fraction of what she stole. KIT DIGITAL: Files Suit Against Invigor Over Asset Acquisition --------------------------------------------------------------- Piksel, Inc., on Feb. 9 disclosed that it has commenced legal action against Invigor Group Limited, formerly known as Hyro Limited. In June of 2012 Piksel's predecessor company, KIT digital, Inc. acquired substantially all of the assets of Invigor in exchange for $2 million cash and shares of KIT digital, Inc., valued at approximately $15 million. The shares issued to Invigor as consideration were subject to a "Top-Off" provision. The lawsuit filed by Piksel accuses Invigor of making fraudulent, negligent, and misleading representations regarding its customer relationships, its business outlook, and its cash tax liabilities. Piksel's suit seeks disallowance of Invigor's Top-Off claim, cash damages, and recovery of Piksel's attorney's fees. The suit is an amendment to litigation previously commenced in KIT digital, Inc.'s reorganization case in the US Bankruptcy Court for the Southern District of New York, where Invigor's Top-Off claim was previously subordinated to the claims of general creditors. "Invigor claimed it was selling a $25 million revenue business with happy customers. Invigor also claimed it had no outstanding tax obligations," said Allan Dunn, Chief Operating Officer of Piksel. "In truth, Invigor was a business less than half that size and it was losing customers at a very rapid rate. Invigor also had significant undisclosed tax obligations in Australia and New Zealand." This suit is a result of a review of all partnerships and agreements by Piksel's new leadership team. "As a listed company in Australia, Invigor continues to make public statements that it expects to receive warrants to purchase 8% of the outstanding shares of Piksel. We feel very strongly that when presented at trial, the facts will demonstrate that Invigor made significant fraudulent and negligent representations. As such, pending resolution of the litigation, Piksel will not issue any warrants to Invigor; on the contrary, Piksel is seeking to recover damages from Invigor," said Fabrice Hamaide, Chief Financial Officer of the Company. A complete copy of the complaint is available on http://www.americanlegalclaims.com/kdi About Piksel Headquartered in New York City, Piksel (formerly KIT digital, Inc.) is a global provider of digital television and media solutions. Its offices can be found throughout Europe and the Americas, serving more than 1,600 clients in over 50 countries. About KIT digital New York-based KIT digital Inc. -- http://www.kitd.com/-- is a video management software and services company. KIT digital services nearly 2,500 clients in 50+ countries including some of the world's biggest brands, such as Airbus, The Associated Press, AT&T, BBC, BSkyB, Disney-ABC, Google, HP, MTV, News Corp, Sky Deutschland, Sky Italia, Telecom Argentina, Telecom Italia, Telefonica, Universal Studios, Verizon, Vodafone VRT and Volkswagen. KIT digital filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 13-11298) in Manhattan on April 25, 2013. The Debtor disclosed $310,206,684 in assets and $23,011,940 in liabilities. KIT's operating subsidiaries, including Ioko 365, Polymedia, Kewego, Multicast and Megahertz are not included in the Chapter 11 filing. Jennifer Feldsher, Esq., and Anna Rozin, Esq., at Bracewell & Giuliani LLP, in New York, serve as counsel to the Debtor. American Legal Claims Services LLC is the claims and noticing agent and the administrative agent. The Official Committee of Equity Security Holders tapped to retain Brown Rudnick LLP, as lead bankruptcy counsel. The Official Committee of Unsecured Creditors tapped to retain Cathy Hershcopf, Esq., at Cooley LLP as its lead bankruptcy counsel, and Odyssey Capital Group as its financial advisor. The Debtor won confirmation of its Third Amended Plan of Reorganization, dated as of Aug. 6, 2013, on August 7. The Plan became effective on Aug. 16, 2013. LABORATORY PARTNERS: Wants More Time to Decide on Leases -------------------------------------------------------- Laboratory Partners Inc., et al., filed with the U.S. Bankruptcy Court for the District of Delaware a motion seeking to extend for an additional 90 days, through and including May 27, 2014, the deadline by which the Debtors must assume or reject unexpired leases of nonresidential real property. The Debtors are parties to several unexpired leases of nonresidential real property. The Debtors are in the midst of evaluating options with respect to anticipated sales of their assets. The Debtors have been engaged in active negotiations with potential bidders for the Debtors' assets so as to maximize value for their estates. Consequently, the Debtors have not yet had an opportunity to carefully and thoroughly consider the propriety of assuming or rejecting the Leases, and need additional time to do so in a manner which will be beneficial to their creditors and estates. Currently, the Debtors have until Feb. 24, 2014, to decide on the Leases. The Debtors said, "The Leases are important to their business and it is imperative that the Debtors be afforded sufficient time to evaluate all of the Leases. The Debtors should not be forced at this time to incur administrative claims or reject what may prove to be valuable or necessary assets before the Debtors have had a full opportunity to explore their options with respect to the Leases in the context of these cases." About Laboratory Partners Laboratory Partners Inc., a Cincinnati-based provider of lab and pathology services, filed a petition for Chapter 11 protection on Oct. 25 in Delaware. The case is In re Laboratory Partners Inc., 13-bk-12769, U.S. Bankruptcy Court, District of Delaware (Wilmington). Judge Peter J. Walsh presides over the case. Laboratory Partners is represented by Morris, Nichols, Arsht & Tunnell LLP's Robert Dehney, Esq., and Erin R. Fay, Esq. -- rdehney@mnat.com and efay@mnat.com -- and Pillsbury Winthrop Shaw Pittman LLP's Leo T. Crowley, Esq. -- leo.crowley@pillsburylaw.com -- and Margot P. Erlich, Esq. and Jonathan J. Russo, Esq. BMC Group Inc. serves as claims and administrative agent. The Official Committee of Unsecured Creditors has retained Otterbourg P.C., as Lead Co-Counsel; Klehr Harrison Harvey Branzburg LLP as Delaware Counsel; and Carl Marks Advisory Group LLC, as financial advisors. LADDER CAPITAL: Fitch Says IPO Neutral to Company's 'BB' IDR ------------------------------------------------------------ Fitch views Ladder Capital Corp's initial public offering (IPO) as neutral to the company's 'BB' issuer default rating. Ladder raised $225 million in equity capital by selling 13.25 million of Class A shares in an IPO this week. The company is listed on NYSE under the symbol 'LADR'. The IPO has some positive elements including opening up a new source of capital to fund growth and establishing a public valuation for the company, which creates optionality for existing owners including affiliates of Alberta Investment Management Corp., GI Partners, Ontario Municipal Employees Retirement System and TowerBrook Capital Partners. Publicly traded shares represent approximately 15% of the company's capital base as of Sept. 30, 2013, pro forma for the IPO. The public ownership addresses the relatively shorter-term investment horizon of the company's private equity firm owners, which could have otherwise potentially introduced strategic uncertainty or shareholder friendly activities, including Ladder acquiring these firms' equity stakes by incurring additional debt. In addition, the equity raise should result in modestly reduced leverage, at least for the near term. As of Sep. 30, 2013, Ladder's leverage, calculated as gross debt to tangible equity, was 1.0x (0.9x pro forma for the IPO), well below management's stated leverage target of 2.0x - 3.0x. However, public ownership could potentially put pressure on the company to generate short-term earnings growth or challenge the company's current balanced operating strategy. Fitch views the company's management team and conservative operating strategy (including reduced risk taking depending on market conditions) as key strengths to current ratings. Any adverse changes to the operating strategy including aggressive growth or loosening of underwriting standards would be viewed negatively by Fitch. LAND RESOURCE: 6th Circuit Says Condo Owner Can't Sue Insurers -------------------------------------------------------------- Law360 reported that in an unpublished opinion on Jan. 30, the Sixth Circuit upheld a district court's ruling that there is no exception to a Tennessee law barring a condo owner from directly suing the insurers of two companies that she says defrauded her, even though the alleged perpetrators entered bankruptcy while the woman's lawsuit against them was still pending. According to the report, a three-judge panel for the appellate court ruled in favor of Great American E and S Insurance Co., the insurer of now-defunct Land Resources Co. and its affiliate Villages at Norris Lake, LLC. The case is Diane Mauriello v. Great American E and S Insurance Co., Case No. 13-5469 (6th Cir.). About Land Resource Headquartered in Orlando, Florida, Land Resource LLC -- http://www.landresource.com-- developed residential communities, includig coastal, lakefront and mountain locations in Georgia, North Carolina, West Virginia, Tennessee and Florida. The Company and its affiliates filed for Chapter 11 protection on October 30, 2008 (Bankr. M.D. Fla. Lead Case No. 08-10159). Jordi Guso, Esq., at Berger Singerman, P.A., in Miami, Florida, and Richard D. Sierra, Esq., at Kosto & Rotella PA, in Orlando, Florida, were counsel to the Debtors. Jeffrey I. Snyder, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, in Miami, Florida, represented the Committee of Creditors Holding Unsecured Claims as counsel. The Company listed assets of $100 million to $500 million and debts of $50 million to $100 million. Trustee Services Inc. is the Debtors' notice, claims and balloting agent. LIBERTY MEDICAL: Court Rejects Relators' Reverse False Claim ------------------------------------------------------------ Bankruptcy Judge Peter Walsh in Wilmington, Delaware, rejected the proofs of claims filed by Lucas W. Matheny and Deborah Loveland -- former employees of Liberty Medical Supply, Inc., and/or its affiliated debtors -- who have alleged that Liberty received millions of dollars in what they term "Overpayments" from federal health care payors (e.g., Medicare, Medicaid) that Liberty allegedly never repaid or reported to the government per Liberty's Corporate Integrity Agreement. Mr. Matheny and Ms. Loveland, so- called Relators, also allege that Liberty created false records during the annual paid claims reviews mandated by the Corporate Integrity Agreement and conducted by independent auditors. In June 2008, the Relators filed their initial qui tam complaint under seal in the Florida District Court, alleging violations of the reverse false claim provision of the False Claims Act, 31 U.S.C. Sec. 3729(a)(7) (2006), against the Debtors and certain non-debtor entities. The U.S. Department of Justice spent over a year investigating the Relators' claims, at the conclusion of which the Department of Justice declined to intervene in the case. Judge Walsh held that the Relators have received more than four million pages of documents and numerous databases containing reams of data from the Debtors; have deposed 10 witnesses, including three extensive corporate depositions; and have retained two experts. Yet their claims remain unsubstantiated. Accordingly, Judge Walsh granted the Motion for "Summary Judgment on Joint Objection to Proofs of Claim 303, 304, and 305" filed by debtors PolyMedica Corporation, Liberty Healthcare Group, Inc., and Liberty Medical Supply, Inc., finding that there are no genuine disputes regarding the material facts and that the Debtors and the creditors that joined in the Summary Judgment Motion are entitled to judgment as a matter of law on the joint objection to proofs of claim numbers 303, 304, and 305. In his Feb. 6, 2014 decision available at http://is.gd/aj5HBxfrom Leagle.com, Judge Walsh held that the requisite elements of a reverse false claim have not been proven, nor have any factual or legal arguments been disputed. In sum, going through the elements, not a single one has been sustained. There has been no proof of a false record or statement. There has been no proof of Liberty's knowledge of any falsity. There has been no proof that Liberty made, used or caused a false statement for the purpose of concealing, avoiding or decreasing money owed to the federal government. There has been no proof that Liberty had any specific legal monetary obligation owed to the federal government by which it attempted to fraudulently circumvent. Mark S. Chehi, Esq., Robert A. Weber, Esq., and Jason M. Liberi, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP; Michael R. Manthein, Esq., William N. Shepherd, Esq., and Daniel S. Fridman, Esq., at Holland & Knight LLP; and Ted A. Berkowitzn, Esq., and Veronique Urban, Esq., at Farrell Fritz, P.C., argue for Arlene (Perazella) Rodriguez, a creditor and currently Liberty's Executive Vice President of Operations and Chief Operating Officer. Ms. Rodriguez was named as defendant in the qui tam suit. Jack E. Fernandez, Esq., and Nathan M. Berman, Esq., at Zuckerman Spaeder LLP, represent Carl Dolan, a former Liberty employee, who was also named as defendant in the qui tam suit. Mr. Dolan served as Assistant Vice President and Vice President in Liberty's Account Services Department (later known as RCM). Adam Hiller, Esq., and Brian Arban, Esq., at Hiller & Arban, LLC; Mark A. Cullen, Esq., at The Cullen Law Firm, P.A., serve as attorneys for the Relators, and counsel to Medco Health, Solutions, Inc. About Liberty Medical Entities that own diabetics supply provider Liberty Medical led by ATLS Acquisition, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10262) on Feb. 15, 2013, just less than three months after a management buy-out and amid a notice by the lender who financed the transaction that it's exercising an option to acquire the business. Liberty has been in business for 22 years serving the needs of both type 1 and type 2 diabetic patients. Liberty is a mail order provider of diabetes testing supplies. In addition to diabetes testing supplies, the Debtors also sell insulin pumps and insulin pump supplies, ostomy, catheter and CPAP supplies and operate a large mail order pharmacy. Liberty operates in seven different locations and has 1,684 employees. Dennis A. Meloro, Esq., Nancy A. Mitchell, Esq., and Joseph P. Davis, Esq., at Greenberg Traurig, LLP; and Enu Mainigi, Esq., and Jennifer G. Wicht, Esq., at Williams & Connolly LLP, Washington, D.C., serve as the Debtor's counsel; Ernst & Young LLP to provide investment banking advice; and Epiq Bankruptcy Solutions, LLC, as claims and noticing agent for the Clerk of the Bankruptcy Court. An official committee of unsecured creditors has been appointed in the case and consists of LifeScan, Inc., Abbott Laboratories, and Teva Pharmaceuticals USA, Inc. They are represented by Joseph H. Huston Jr., Esq., Maria Aprile Sawczuk, Esq., and Camille C. Bent, Esq., of Stevens & Lee P.C. as well as Bruce Buechler, Esq., S. Jason Teele, Esq., and Nicole Stefanelli, Esq. of Lowenstein Sandler LLP. The Committee has tapped Mesirow Financial Consulting, LLC, as financial advisors. LIBERTY MEDICAL: Hires EYCA as Financial Advisor ------------------------------------------------ ATLS Acquisition, LLC and its debtor-affiliates seek authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Ernst & Young Capital Advisors, LLC ("EYCA") as financial advisor, nunc pro tunc to Jan. 1, 2014. The Debtors require EYCA to: (a) evaluate the Debtors' potential debt capacity in light of projected cash flows; (b) advise the Debtors on financial issues in connection with the Debtors' determination of a capital structure in connection with a Financing; (c) advise the Debtors on tactics and strategies for negotiating with lenders or investors; (d) render financial advice to the Debtors in connection with a Financing and, at the request of the Debtors, participating in meetings or negotiations with lenders, investors and rating agencies or other appropriate parties in connection with a Financing; (e) advise the Debtors on the timing, nature, structure and terms of new debt or loan, other considerations or other inducements to be offered pursuant to a Financing; (f) advise and assist the Debtors in evaluating potential Financing transactions from a financial perspective; (g) contact potential sources of capital; (h) assist the Debtors in implementing a Financing; (i) assist the Debtors in their preparation of marketing materials and other documentation required in connection with any Financing, subject to the provisions of the Engagement Agreement; (j) attend meetings of the Debtors' Board of Directors and the Board's committees with respect to matters on which EYCA has been engaged to advise; and (k) provide other related financial advisory services specifically relating to the Financing. By separate application and order, the Debtors have already retained Ernst & Young LLP ("EY LLP") as financial advisor to the Debtors. EYCA is a separate legal entity from EY LLP and EYCA has its own engagement agreement with the Debtors, separate from that of EY LLP. EYCA will be paid at these hourly rates: Managing Director $715-$880 Senior Vice President $585-$720 Vice President $485-$600 Associate $360-$440 Analyst $185-$225 EYCA will also be reimbursed for reasonable out-of-pocket expenses incurred. K.C. Brechnitz, senior managing director of EYCA, 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. EYCA can be reached at: K.C. Brechnitz ERNST & YOUNG CAPITAL ADVISORS, LLC Suite 3800, 100 N. Tryon Street Charlotte, NC 28202 Tel: (704) 372-6300 Fax: (704) 331-1988 About Liberty Medical Entities that own diabetics supply provider Liberty Medical led by ATLS Acquisition, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10262) on Feb. 15, 2013, just less than three months after a management buy-out and amid a notice by the lender who financed the transaction that it's exercising an option to acquire the business. Liberty has been in business for 22 years serving the needs of both type 1 and type 2 diabetic patients. Liberty is a mail order provider of diabetes testing supplies. In addition to diabetes testing supplies, the Debtors also sell insulin pumps and insulin pump supplies, ostomy, catheter and CPAP supplies and operate a large mail order pharmacy. Liberty operates in seven different locations and has 1,684 employees. Dennis A. Meloro, Esq., Nancy A. Mitchell, Esq., and Joseph P. Davis, Esq., at Greenberg Traurig, LLP; and Enu Mainigi, Esq., and Jennifer G. Wicht, Esq., at Williams & Connolly LLP, Washington, D.C., serve as the Debtor's counsel; Ernst & Young LLP to provide investment banking advice; and Epiq Bankruptcy Solutions, LLC, as claims and noticing agent for the Clerk of the Bankruptcy Court. An official committee of unsecured creditors has been appointed in the case and consists of LifeScan, Inc., Abbott Laboratories, and Teva Pharmaceuticals USA, Inc. They are represented by Joseph H. Huston Jr., Esq., Maria Aprile Sawczuk, Esq., and Camille C. Bent, Esq., of Stevens & Lee P.C. as well as Bruce Buechler, Esq., S. Jason Teele, Esq., and Nicole Stefanelli, Esq. of Lowenstein Sandler LLP. The Committee has tapped Mesirow Financial Consulting, LLC, as financial advisors. LIQUIDATION WORLD: Closes 73 Stores in Canada --------------------------------------------- Wetaskiwin Times reports that The LW (Liquidation World) outlet in the Wetaskiwin Mall in Wetaskiwin, Alberta, is only one of 73 stores under the brand name to close up shop across Canada. LW's parent company, Big Lots, based in Columbus, Ohio, made the announcement last month in its third quarter results of 2013. Not only is it shuttering the LW stores, but another five stores under the Big Lots name brand, two distribution centers and an office, are also on the chopping block, according to Wetaskiwin Times. The report relates that the "principal operations will cease during the first quarter of fiscal 2014. Big Lots purchased "the struggling Canadian business in July 2011 with the intention of revitalizing it and using it as a base for bringing extreme value merchandising and the Big Lots brand to customers in Canada, the report recalls. Andrew Regrut, director of investor relations for Big Lots, declined to say how many employees would lose their jobs at the Ontario location this spring. There are estimated 1,600 workers employed by the company across Canada. Liquidation World, with shelves stocked with everything from toys, health and beauty products to clothing and hardware "was a struggling retailer." The Canadian Company had not made money for the previous five to six years. About Liquidation World Liquidation World (TSX:LQW) liquidates consumer merchandise through 92 stores in Canada. The Company solves asset recovery problems in a professional manner for the financial services industry, insurance companies, manufacturers, wholesalers and other organizations. Liquidation World is based in Brantford, Ontario. The Company opened its first store in Calgary, Alberta in 1986 and today, with more than 1,200 employees, is Canada's largest operator of closeout retail stores. LONGVIEW POWER: Exclusive Plan Filing Deadline Moved to March 14 ---------------------------------------------------------------- The Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware has extended, at the behest of Longview Power LLC, et al., the exclusive periods for the Debtors to file a Chapter 11 plan to March 14, 2014, and to solicit acceptances of that plan until May 15, 2014. As reported by the Troubled Company Reporter on Jan. 27, 2014, the backstoppers -- holders of approximately 60% of the debt outstanding under the Longview Credit Agreement -- supported the extension of the exclusivity periods and expressed support on the Debtors' response to Kvaerner North American Construction Inc.'s objection to the extension request. Kvaerner had said that the Debtors and the Backstoppers repeatedly expressed that reorganization in the cases must be accomplished quickly and that any other timetable was unworkable. Kvaerner claimed that through the exclusivity motion, the Debtors sought to prolong the timeframe for reorganization. The TCR reported on Jan. 3, 2014, the Debtor sought the extension in concert with the Feb. 10 plan confirmation hearing. Longview in November 2013 filed a bankruptcy-exit plan that will drop $1 billion in debt from the Debtor's balance sheet and raise money to cover the cost of fixing the plant. Under the Plan, the lenders under a $1.04 billion credit facility would share between 85% and 90% of the reorganized company's equity, court papers show. The lenders providing the bankruptcy loan would get the rest of the equity. An unresolved issue is the status of $370 million in mechanics' liens and whether they come before or behind other lenders. The company initiated proceeding for the bankruptcy court to estimate the mechanics' lien claims. The company says they are entitled to no payment under the plan. On Jan. 24, 2014, the Debtors filed a notice saying that the confirmation hearing has been adjourned to March 10, 2014, at 10:00 a.m., prevailing Eastern Time. On Jan. 28, 2014, Kvaerner withdrew its objection without prejudice for Kvaerner to respond or object to additional or subsequent requests by the Debtors to extend the exclusive periods. 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. The Debtor disclosed assets of $1,717,906,595 plus undisclosed amounts and liabilities of $1,075,748,155 plus undisclosed amounts. 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. LONGVIEW POWER: Kvaerner Wants Relief From Automatic Stay --------------------------------------------------------- Kvaerner North American Construction Inc. filed on Jan. 22, 2014, a motion for relief from automatic stay for it to be able to pursue claims under insurance policies in which Longview Power LLC, et al., may have an interest. Kvaerner wants to (a) pursue claims tendered under the insurance policies prior to the Petition Date and (b) tender new claims under the insurance policies, in which the Debtors may have an interest, on account of damages incurred or that could be incurred by Kvaerner and arising out of the power facility project, including seeking reimbursement, defense costs, and indemnification as necessary. In connection with the power facility project, Kvaerner has direct insurance claims for damage caused by others, and insurance claims for third-party claims brought against Kvaerner. Prior to the Petition Date, Kvaerner tendered insurance claims under the Allianz and Liberty Mutual Policies as well as the excess policies. Longview Power LLC is a named insured under the Allianz Policy and is believed to be an additional insured under the Liberty Mutual Policy, and by extension the excess policies, on account of the Services Agreement with Kvaerner. The Excess Policies provide excess coverage in the event that the coverage available under the Liberty Mutual Policy is depleted. The Debtors did not list any of the Insurance Policies in the Longview Schedules and it is unclear if the Longview estate claims a property interest in the insurance policies or if Longview has a property interest in the proceeds available under the insurance policies. It yet is unclear whether the insurance policies are subject to the automatic stay provisions of the U.S. Bankruptcy Code, Kvaerner said in its Jan. 22, 2014 court filing. Prior to the commencement of the bankruptcy cases, Allianz Global Risk U.S. Insurance Company issued its Builder's All-Risk Policy, with limits of $1.41 billion for material damage per any one occurrence and $383.94 million in the aggregate for "time element" loss. The Allianz Policy lists Longview and Kvaerner as named insureds and provides project specific, first-party coverage for Kvaerner's losses. In connection with the power facility project, Liberty Mutual Fire Insurance Company issued a Commercial General Liability Policy, wherein Kvaerner and certain of its subcontractors were named insureds. The Liberty Mutual Policy provides coverage in the amount of $2 million per occurrence and $4 million in the aggregate. Kvaerner also secured: (a) an "Excess Construction (Wrap Up) Liability Policy (CCIP)", issued by Aspen Insurance UK Ltd./Lloyds Syndicate 2003 as a first layer of excess coverage, which provides coverage above the Liberty Mutual Policy of up to $25 million per occurrence with a cap of $25 million; (b) a "Following Form Liability Insurance Policy" issued by Endurance Specialty Insurance Ltd. as a second layer of excess coverage, which provides coverage above the Aspen/Lloyds Policy of up to $25 million per occurrence with a cap of $25,000,000; and (c) a "Following Form Liability Insurance Policy" issued by XL Europe Ltd as a third layer of excess coverage above the Endurance Policy of up to $50 million per occurrence with a cap of $50 million. The excess policies cover the same named insureds and, with some exceptions, are generally subject to the same terms, definitions, exclusions and limitations as the Liberty Mutual Policy. 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. The Debtor disclosed assets of $1,717,906,595 plus undisclosed amounts and liabilities of $1,075,748,155 plus undisclosed amounts. 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. LOUISIANA RIVERBOAT: May Use Cash Collateral Through March 31 ------------------------------------------------------------- Louisiana Riverboat Gaming Partnership, et al., and the ad hoc group of first lien lenders have agreed to extend the term of the Debtors' use of cash collateral through March 31, 2014, from Dec. 31, 2013, on the same terms and conditions as provided in the final cash collateral order. A copy of the budget is available for free at: http://bankrupt.com/misc/LOUISIANARIVERBOATcashcollextbudget.pdf As reported by the Troubled Company Reporter on Oct. 2, 2012, the U.S. Bankruptcy Court for the Western District of Louisiana authorized, on a final basis, the Debtor to use the cash collateral of the first lien lenders and second lien lenders. Each of the lenders asserts that certain prepetition obligations were secured by valid, enforceable and properly perfected liens on and security interest in substantially all assets and cash held in certain accounts of the Debtors. According to the Debtors, as of the Petition Date they were liable to: -- Wilmington Trust Company, as administrative agent for the First Lien Lenders in respect of obligations under the First Lien Credit Agreement and related agreements and documents for the aggregate amount of not less than $181,182,013; and -- Wells Fargo Bank, N.A., as administrative agent for the Second Lien Lenders in respect of obligations under the Second Lien Credit Agreement and related agreements and documents for the aggregate amount of not less than $116,252,898. The TCR reported on Oct. 2, 2012, that as adequate protection from any diminution in value of the lender's collateral, the Debtors were allowed to: 1. grant first priority replacement security interests in and liens upon all postpetition property of the Debtors and their estates and all proceeds and products of such property subject only to the carve-out; and 2. grant second priority replacement security interests and pay a total of $40,000 to the Second Lien Agent to be applied to outstanding and future agency, administrative and transaction fees of the Second Lien Agent during the Chapter 11 cases. About Legends Gaming Legends Gaming LLC, owns gaming facilities located in Bossier City, Louisiana, and Vicksburg, Mississippi, operating under the DiamondJack's trade name. Legends Gaming LLC, and five related entities, including Louisiana Riverboat Gaming Partnership, filed Chapter 11 petitions (Bankr. W.D. La. Case No. 12-12013) in Shreveport, Indiana, on July 31, 2012, to sell the business for $125 million to Global Gaming Solutions LLC, absent higher and better offers. Legends Gaming acquired the business from Isle of Capri Casinos Inc., in 2006 for $240 million. After breaching covenant with lenders, the Debtors in March 2008 sought Chapter 11 protection, jointly administered under Louisiana Gaming Partnership (Case No. 08-10824). The Debtors emerged from bankruptcy in September 2009 and retained ownership and operation of two "DiamondJacks" hotels and casinos in Bossier City and Vicksburg. The Plan restructured $162.1 million owed to the first lien lenders and $75 million owed to secured lien lenders, which would be paid in full, with interest, over time. The Debtors' properties comprise 60,000 square feet of gaming space with 1,913 slot machines, 48 table games and 693 hotel rooms. Revenues in fiscal 2011 were $99.8 million in Louisiana and $39.7 million in Mississippi. As of July 31, 2012, first lien lenders are owed $181.2 million and second lien lenders are owed $114.7 million. Louisiana Riverboat Gaming Partnership disclosed $104,846,159 in assets and $298,298,911 in liabilities as of the Chapter 11 filing. Attorneys at Heller, Draper, Hayden Patrick & Horn serve as counsel to the Debtors. Sea Port Group Securities, LLC is the financial advisor. Kurtzman Carson Consultants LLC as is the claims and notice agent. The Debtors have tapped Jenner & Block LLP as special counsel. The primary purposes of the Plan are: (i) to provide for the sale of substantially all of the Debtors' assets to Global Gaming Legends, LLC, a Delaware limited liability company, Global Gaming Vicksburg, LLC, a Delaware limited liability company and Global Gaming Bossier City, LLC, a Delaware limited liability company, pursuant to a certain Purchase Agreement dated as of July 25, 2012; and (ii) to provide for payments and distributions to creditors. MERITAGE HOMES: Moody's Hikes Corp. Family Rating to 'Ba3' ---------------------------------------------------------- Moody's Investors Service raised the Corporate Family Rating of Meritage Homes Corporation to Ba3 from B1 and Probability of Default rating to Ba3-PD from B1-PD. Concurrently, Moody's upgraded all of the company's existing senior unsecured notes and convertible senior notes due 2032 to Ba3 from B1. Moody's also affirmed Meritage's Speculative-Grade Liquidity (SGL) assessment at SGL-2. The rating outlook is stable. The upgrade of the Corporate Family Rating to Ba3 reflects the expectation for continued improvement in Meritage's credit metrics. Moody's projects adjusted homebuilding debt leverage to be maintained below 50% and gross margins are projected to be at least 22% resulting in continued positive net income generation. The following rating actions were taken: Corporate Family Rating, upgraded to Ba3 from B1; Probability of Default Rating, upgraded to Ba3-PD from B1-PD; $175 million 4.5% senior unsecured notes due 2018, upgraded to Ba3 (LGD4, 53%) from B1 (LGD4, 54%); $303 million 7.15% senior unsecured notes due 2020, upgraded to Ba3 (LGD4, 53%) from B1 (LGD4, 54%); $300 million 7.0% senior unsecured notes due 2022, upgraded to Ba3 (LGD4, 53%) from B1 (LGD4, 54%); $127 million 1.875% convertible senior unsecured notes due 2032, upgraded to Ba3 (LGD4, 53%) from B1 (LGD4, 54%); Senior unsecured shelf rating, upgraded to (P)Ba3 from (P)B1; Speculative Grade Liquidity assessment, affirmed at SGL-2; The rating outlook is stable. Ratings Rationale The Ba3 Corporate Family Rating reflects Meritage's improving operating performance which is expected to result in a moderate adjusted homebuilding debt-to-capitalization ratio of 46% in 2014 and continued profitability on a net income basis (the company resumed generating net income in Q2 2012). Additionally, the Ba3 rating reflects Moody's projected healthy gross margins of around 22% by the end of 2014, modest land supply, and good cash position. Moreover, our ratings incorporate the industry's positive momentum which Moody's expect to support the improvement in the company's credit metrics in 2014. At the same time, the rating is constrained by projected negative free cash flow generation as the company invests in land and land development over the next 12 to 18 months. The rating also reflects the company's reliance on its Texas and California operations, which accounted for 27% and 26%, respectively, of revenues for the YTD period ended 9/30/13. The SGL assessment takes into account internal and external sources of liquidity, covenant compliance, and alternate sources of liquidity. Meritage's SGL-2 rating indicates a good liquidity profile, supported by a $274 million cash balance and $90 million short term investments and market table securities balance at December 31, 2013, full availability under its $200 million revolving credit facility, and by the lack of near term debt maturities. However, liquidity is constrained by the expected negative cash flow generation, lack of any significant sources of alternate liquidity, and by the need to comply with the financial covenants in the credit facility agreement. The stable outlook reflects Meritage's steady financial performance and our view that the company will continue to generate improved results over the next year, as demand and pricing continue to strengthen. The outlook also incorporates our view that an improving operating environment combined with expected capital structure discipline should allow the company's debt leverage to decline. The ratings would be considered for an upgrade if Meritage's adjusted homebuilding debt-to-capitalization ratio declined below 40% and if the company expands its profitability on a net income basis, while maintaining strong liquidity. In addition, a material increase in size, scale, and diversification is an important consideration for upgrade. The ratings could be lowered if the company jeopardized its liquidity position by engaging in land purchases or substantial share buy-backs, if gross margins or earnings deteriorate substantially, or if the adjusted homebuilding debt-to- capitalization ratio is maintained above 50% during the next 12 to 18 months. The principal methodology used in this rating was the Global Homebuilding Industry published in March 2009. Other methodologies used include Loss Given Default for Speculative-Grade Non- Financial Companies in the U.S., Canada and EMEA published in June 2009. Meritage Homes Corporation is the ninth largest homebuilder in the U.S., primarily building single-family and attached homes in 18 metropolitan areas in Arizona, Texas, California, Colorado, Florida, North Carolina, South Carolina, and Tennessee. Formerly known as Meritage Corporation, the company was founded in 1985 and is headquartered in Scottsdale, Arizona. Total revenues and consolidated net income for 2013 were approximately $1.8 billion and $124 million, respectively. MESA AIR: KSAZ News 10 Story Misrepresents Pilots, ALPA Says ------------------------------------------------------------ Air Line Pilots Association, Int'l disclosed that on Feb. 7, 2014, Mesa Air Group pilots, represented by the Air Line Pilots Association, Int'l (ALPA), condemned a news story aired by Phoenix-based Fox affiliate KSAZ News 10 on Feb. 6. The sensationalized story cited a number of inaccuracies, including one that asserts that no pilots were laid off during Mesa's 2010 Chapter 11 bankruptcy and that a Mesa Airlines captain can earn $100,000, while proclaiming that "starting pay is modest." "In truth, our pilots often leave flight schools with more than $100,000 in student loan debt, only to find a job at Mesa paying $22,000 a year," said First Officer Marcin Kolodziejczyk, head of the Mesa unit of ALPA. "This is unconscionable for a well-trained pilot entrusted with the lives of hundreds of passengers each day. After eight years, a first officer may expect to make $40,000 a year, while he waits to be upgraded to captain. This is hardly the lucrative career path that the news story depicted." Though the story claimed that the company was able to "avoid lay- offs" during its 2010-11 bankruptcy, in fact, the company furloughed almost 500 pilots plus flight attendants and many other employees in an effort to cut costs. The pilot group also took deep cuts in quality-of-life issues, such as health care. For the past two years, the pilot leadership at Mesa has been attempting to recuperate many of these benefits during contract negotiation talks with management. However, talks have been slow on the economic issues of the contract, and pilots continue to work under a 2008 agreement while their company touts new planes, a bright future, and a growing business. "We are extremely proud of our company's achievements and are excited about new aircraft and new business opportunities," continued First Officer Kolodziejczyk. "However, this shouldn't be used as a platform for the company and the media to whitewash the past and misrepresent the current status of our pilots. Our pay scales, work rules, and scheduling continue to be near the bottom of the regional airline industry. If Mesa Air Group truly wants to celebrate its success, we invite them to do so at the negotiating table by offering a fair and equitable deal to their pilots." Founded in 1931, Air Line Pilots Association, Int'l -- http://www.alpa.org-- is the world's largest pilot union, representing nearly 50,000 pilots at 31 airlines in the United States and Canada. About Mesa Air Mesa Air currently operates 76 aircraft with approximately 450 daily system departures to 94 cities, 38 states, the District of Columbia, and Mexico. Mesa operates as US Airways Express and United Express under contractual agreements with US Airways and United Airlines, respectively, and independently as go! Mokulele. This operation links Honolulu to the neighbor island airports of Hilo, Kahului, Kona and Lihue. The Company was founded by Larry and Janie Risley in New Mexico in 1982. Mesa Air Group Inc. and its units filed their Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 10-10018) on Jan. 5, 2010, in New York, listing assets of $976 million against debt totaling $869 million as of Sept. 30, 2009. Richard M. Pachulski, Esq., and Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel to the Debtors. Imperial Capital LLC is the investment banker. Epiq Bankruptcy Solutions is claims and notice agent. Brett Miller, Esq., Lorenzo Marinuzzi, Esq., and Todd Goren, Esq., at Morrison & Foerster LLP, serve as counsel to the Official Committee of Unsecured Creditors. Judge Martin Glenn entered a final order confirming the Third Amended Joint Plan of Reorganization of Mesa Air Group, Inc., and its debtor affiliates on Jan. 20, 2011. Under the plan, the reorganized company will issue new notes, common stock and warrants to creditors. Unsecured creditors that are U.S. citizens will receive a combination of new notes and new common stock, while unsecured creditors that are Non-U.S. citizens will receive a combination of new notes and new warrants. An agreement with US Airways paved way for the filing of the plan. Mesa Air's Plan of Reorganization became effective March 1, 2011. The Company's restructuring accomplishments included elimination of 100 excess aircraft and associated leases and debt which contributed to the deleveraging of Mesa's balance sheet in the approximate amount of $700 million in capitalized leases and $50 million in debt, and extending the term of the code-share agreement with US Airways through September 2015. Bankruptcy Creditors' Service, Inc., publishes Mesa Air Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Mesa Air Group Inc. and its units. (http://bankrupt.com/newsstand/or 215/945-7000). MF GLOBAL: Knighthead Questions Liquidation Fees ------------------------------------------------ Jacqueline Palank, writing for The Wall Street Journal, reports that Knighthead Capital Management LLC said it is "extremely troubled" by what it says is a lack of transparency for millions of dollars of fees charged in the liquidation of MF Global Inc. Knighthead, a New York hedge-fund manager that specializes in distressed investments, is calling for more disclosure of the fees charged by the consultants and other non-legal professionals that trustee James W. Giddens hired to help him wind down the defunct broker-dealer, according to the WSJ. Knighthead said those fees may be as much as $200 million. Knighthead "is extremely troubled by the incurrence of certain non-attorney administrative expenses by the trustee's 'team of professionals' without any ability of creditors or the court to even review such expenses," Knighthead said in court papers obtained by the WSJ. The WSJ notes that appointed to wind down MF Global upon its October 2011 collapse, Mr. Giddens encountered a $1.6 billion shortfall in brokerage customer accounts. In November, he won bankruptcy court approval of a plan to return 100% of the money owed to MF Global's U.S. and overseas commodity customers, the WSJ relates. The report notes that the fees that Mr. Giddens and his lawyers charged for the monumental effort are covered by the Securities Investor Protection Corp, or SIPC, which Congress created in 1970 to protect brokerage customers. The bankruptcy court and SIPC review those fees, the report relays. But SIPC doesn't cover non-legal fees. Instead, that must come out of MF Global's own cash, which is the same stockpile that MF Global creditors like Knighthead are depending on for payment, the WSJ notes. Judge Martin Glenn of the U.S. Bankruptcy Court in Manhattan will consider Knighthead's request at a Feb. 13 hearing. The WSJ relays that Kent Jarrell, Mr. Giddens' spokesman, said SIPC reviewed and approved the consultants' fees on an "ongoing basis." Mr. Giddens said the consultants and accountants, from Ernst & Young and Deloitte, also applied a "substantial public interest discount" to their fees, the WSJ adds. 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. MICHAEL GERARD: $281,000 Judgment Non-Dischargeable --------------------------------------------------- Wisconsin District Judge C.N. Clevert, Jr., affirmed a bankruptcy court order granting Kevin and Margaret Gerard's summary judgment motion finding that a $281,000 judgment was the result of "willful and malicious injury" by Chapter 11 debtor Michael Gerard, Kevin's brother, and, therefore, nondischargeable under 11 U.S.C. Sec. 523(a)(6). The appellate case is MICHAEL J. GERARD, Appellant, v. KEVIN P. GERARD, MARGARET M. GERARD, Appellees, Case No. 13-C-0114 (E.D. Wis.). A copy of the Feb. 5, 2014 Order is available at http://is.gd/Fppt1Nfrom Leagle.com. MONTANA ELECTRIC: Court OKs Hiring of McGuireWoods as Co-Counsel ---------------------------------------------------------------- Southern Montana Electric Generation and Transmission Cooperative, Inc. sought and obtained authorization from the U.S. Bankruptcy court for the District of Montana to employ McGuire Woods LLP, and its professionals, Mike Roeschenthaler, Mark E. Freedlander, Joanne Katsantonis and Michele McKinnon as THE Debtor's co- counsel. The retention of McGuire Woods is intended to supplement work performed by Goodrich, which will remain lead bankruptcy counsel to the Debtor. In particular, McGuire Woods currently expects that it will assist Goodrich in the representation of the Debtor with respect to matters as follows: (a) matters involving applicable cooperative or non-profit law and its intersection with bankruptcy law and/or impact on the Debtor's bankruptcy case; (b) matters requiring the involvement of lawyers with specific expertise in the energy industry; (c) certain matters relating to the plan of reorganization or plan of liquidation process involving the Debtor, including, without limitation, litigation support, to the extent required by Goodrich; (d) strategic bankruptcy and restructuring matters as and when required, including, without limitation, litigation support; and (e) certain other matters as may be requested by the Debtor's Board of Trustees or Goodrich in order to allow the Debtor to fulfill its duties and obligations under this chapter 11 case. McGuire Woods will be paid at these hourly rates: Mike Roeschenthaler $675 Mark E. Freedlander $800 Joanne Katsantonis $675 Michele McKinnon $650 McGuire Woods will also be reimbursed for reasonable out-of-pocket expenses incurred. Mark E. Freehandler, member of McGuire Woods 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. McGuire Woods can be reached at: Mark E. Freedlander, Esq. MCGUIREWOODS LLP EQT Plaza 625 Liberty Avenue, 23rd Floor Pittsburgh, PA 15222 Tel: (412) 667-6000 Fax: (412) 667-6050 E-mail: mfreedlander@mcguirewoods.com About Southern Montana Electric Based in Billings, Montana, Southern Montana Electric Generation and Transmission Cooperative, Inc., was formed to serve five other electric cooperatives. The city of Great Falls later joined as the sixth member. Including the city, the co-op serves a population of 122,000. In addition to Great Falls, the service area includes suburbs of Billings, Montana. Southern Montana filed for Chapter 11 bankruptcy (Bankr. D. Mont. Case No. 11-62031) on Oct. 21, 2011. Southern Montana estimated assets of $100 million to $500 million and estimated debts of $100 million to $500 million. Timothy Gregori signed the petition as general manager. Malcolm H. Goodrich, Esq., at Goodrich Law Firm, P.C., in Billings, Montana, serves as the Debtor's counsel. Harold V. Dye, Esq., at Dye & Moe, P.L.L.P., in Missoula, Montana, represents the Unsecured Creditors' Committee as counsel. After filing for reorganization in October, the co-op agreed to a request for appointment of a Chapter 11 trustee. Lee A. Freeman was appointed as the Chapter 11 trustee in December 2011. He is represented by Joseph V. Womack, Esq., at Waller & Womack, and John Cardinal Parks, Esq., Bart B. Burnett, Esq., Robert M. Horowitz, Esq., and Kevin S. Neiman, Esq., at Horowitz & Burnett, P.C. On Nov. 26, 2013, the Bankruptcy Court removed Mr. Freeman as Chapter 11 trustee for SME, at the behest of Fergus Electric Cooperative Inc. Judge Ralph Kirscher said changed circumstances, such as agreement among the co-op's members on a liquidation plan, eliminate the need for a trustee. Fergus and Beartooth Electric Cooperative, Inc., have asked the Court to convert SME's Chapter 11 case to one under Chapter 7 of the U.S. Bankruptcy Code. MORNINGSTAR MARKETPLACE: Wants Schedules Filing Moved to March 17 ----------------------------------------------------------------- Morningstar Marketplace, LTD, asks the bankruptcy court to extend by 30 days, until March 17, 2014, the deadline to file its Chapter 11 schedules of assets and liabilities, statement of financial affairs and other documents. The Debtor is seeking an extension of the Feb. 17 deadline because, among other things, it was unable to readily obtain complete and accurate records and additional time is necessary to review and sign the final paperwork. About Morningstar Marketplace Morningstar Marketplace, LTD, operator of a flea market business in St. Thomas, Pennsylvania, filed a Chapter 11 bankruptcy petition (Bankr. M.D. Pa. Case No. 14-00451) in Harrisburg on Feb. 3, 2014. Judge Mary. D France presides over the case. Attorneys at Smigel, Anderson & Sacks, LLP serve as counsel to the Debtor. The Debtor estimated $100 million to $500 million in assets and liabilities. MORNINGSTAR MARKETPLACE: Proposes Smigel Anderson as Counsel ------------------------------------------------------------ Morningstar Marketplace, LTD, asks the bankruptcy court for approval to hire Smigel, Anderson & Sacks, LLP as attorneys nunc pro tunc to January 30, 2014. The Debtor desires to employ the firm on a general prepetition retainer of $13,870. Within the one year prior to the Petition Date, the firm received $8,000 for professional services and for reimbursement of expenses. All charges will be billed at the firm's standard hourly billing rates: Hourly Rate ----------- Robert L. Knupp, Esq. $300 Louise S. Hutchinson, Esq. $275 Adam G. Klein, Esq. $250 Associates $200 Paralegal $150 Robert L. Knupp attests that his firm represents no other entity in connection with the case, is a "disinterested person" as that term is defined in 11 U.S.C. Sec. 101(14), and represents or holds no interest adverse to the interests of the estate with respect to matters upon which it is to be employed. About Morningstar Marketplace Morningstar Marketplace, LTD, operator of a flea market business in St. Thomas, Pennsylvania, filed a Chapter 11 bankruptcy petition (Bankr. M.D. Pa. Case No. 14-00451) in Harrisburg on Feb. 3, 2014. Judge Mary D France presides over the case. Attorneys at Smigel, Anderson & Sacks, LLP serve as counsel to the Debtor. The Debtor estimated $100 million to $500 million in assets and liabilities. MSI CORPORATION: Wants Until June 2 to File Chapter 11 Plan ----------------------------------------------------------- MSI Corporation asks the Hon. Jeffery A. Deller of the U.S. Bankruptcy Court for the Western District of Pennsylvania to further extend its exclusive period to: a) file a Chapter 11 plan of reorganization until June 2, 2014; and b) solicit acceptances of that plan to Aug. 1, 2014. The Debtor reminds the Court that this is its second extension request. The Debtor notes that the current deadline to file a Chapter 11 plan was slated to expire Feb. 2, 2014, absent an extension. The Debtor said it has made significant progress towards reorganization during its bankruptcy case, but is still unable to propose a meaningful plan of reorganization. The Debtor says extending the exclusivity deadlines will allow it to continue its attempt to obtain financing that could fund a reorganization plan. About MSI Corp. MSI Corporation filed a bare-bones Chapter 11 petition (Bankr. W.D. Pa. Case No. 13-22457) in Pittsburgh on June 7, 2013. Judge Jeffery A. Deller presides over the case. The Vandergrift, Pennsylvania-based company estimated at least $10 million in assets and less than $10 million in liabilities. Albert's Capital Services LLC is the Debtor's chief restructuring officer. Michael J. Roeschenthaler, Esq., and Scott E. Schuster, Esq., at McGuireWoods LLP, in Pittsburgh, serve as the Debtor's counsel. Geary & Loperfito LLC serves as special counsel. No unsecured creditors was formed because no one responded to the U.S. Trustee's communication for service on the committee. MW GROUP: BofA to File Amended Plan & Disclosure Statement ---------------------------------------------------------- Bank of America, N.A., intends to file an amended plan and disclosure statement to (i) supplement its disclosures and make certain clarifying modifications to the bank's Chapter 11 plan of liquidation for MW Group, LLC, (ii) resolve any remaining objections to its disclosure statement, and (iii) comply as otherwise directed by this Court. On Jan. 23, 2014, the Debtor and BofA each filed with the U.S. Bankruptcy Court for the Western District of North Carolina on Jan. 23, 2014, objections to their respective Chapter 11 plans. BofA is the Debtor's pre-petition senior secured lender, asserting a lien on the Debtor's certain vacant land, 48 condominium units, and 200 apartment units for rent known as Weyland and Weyland II, as well as the leases, rents, profits and proceeds generated by the Property. BofA asserts a claim in the amount of approximately $5,700,000 as of the Petition Date. The Property has historically appraised at significantly in excess of $10 million, and the Debtor has had the Property appraised during this case at $10,614,000. As reported by the Troubled Company Reporter on Feb. 10, 2014, the Court held a hearing Jan. 30, 2014, on the disclosure statements explaining the competing plans. A copy of the disclosure statement accompanying the Debtor's Second Amended Plan of Reorganization, which proposes to pay all allowed claims in full, with interest, is available at no extra charge at: http://bankrupt.com/misc/MWGROUPds.pdf A copy of the first amended disclosure statement accompanying BofA's Chapter 11 plan of liquidation, which proposes to conduct an expedited auction of the Property after confirmation, in order to pay $5.90 million to BOA, is available for free at: http://bankrupt.com/misc/MWGROUP1ds.pdf The Debtor asked the Court to deny approval of BofA's Disclosure Statement because, among others, it: (i) contains no information regarding the total amount of administrative expenses of the estate, including professional fees; and (ii) fails to identify the proposed third-party property manager that will manage the Property after confirmation of the BofA Plan, the qualifications of the individual or entity to manage the Property, or the terms of any compensation payable to the third-party property manager. On Jan. 27, 2014, BofA responded to the Debtor's objection, saying that the Debtor has failed to identify any material inadequacies in bank's Disclosure Statement. To address certain objections raised by Debtor, the Bankruptcy Administrator, and the U.S. Department of Justice (Environment and Natural Resources Division) to the Disclosure Statement, BofA intends to file an amended plan and disclosure statement. "Pursuant to Debtor's most recent operating report, Debtor certifies that: 'there are '[n]o post petition liabilities exist[ing] at the end of this reporting period. Debtor then lists the total amount of such claims as '$0.' The operating report also shows sufficient cash on hand ($802,267.43 as of Nov. 30, 2013) to pay all administrative claims in full under the Amended Bank Disclosure Statement. Moreover, the Debtor Disclosure Statement only provides an estimate of the expected outstanding fees of professionals prior to the confirmation date and refers to an additional $1,300,500 administrative claim to insider Laurance Realty. Debtor will not assume, or assume and assign, the Laurance Realty contract under Amended Bank Plan," BofA said in its Jan. 27 court filing. According to the BofA, it will be authorized, in consultation with Debtor, to appoint a property manager. If Laurance Realty continues to be interested in serving as property manager, the bank, in collaboration with Debtor, will consider retaining Laurance Realty, which will serve for the time period between confirmation of the amended Plan and the effective date. On Jan. 23, BofA also filed an objection to the Debtor's Plan, claiming that the Debtor fails to disclose information sufficient to allow creditors to cast an informed vote on the Plan, including: (1) how Debtor expects to pay all claims in a full and timely fashion; (2) why certain classes of claimants will receive different payments at different times; and (3) why Debtor's insiders are provided substantial benefits under the Debtor Plan without providing any consideration to Debtor or its creditors. "The Disclosure Statement also describes a patently unconfirmable Debtor Plan that, inter alia: (a) is not feasible; (b) violates the absolute priority rule; (c) unfairly discriminates against BofA and other creditors; (d) violates the best interest of creditors test; and (e) is proposed in bad faith," BofA claims in the filing. About MW Group LLC MW Group, LLC, owns 36.5 acres of vacant land, 48 condominium units in the Marlborough Woods Condominium Association for rent, and 200 apartments known as Weyland and Weyland II, located in Charlotte, Mecklenburg County, North Carolina. MW Group is owned by 6 entities and individuals, A. Bruce Parker, Inc. (27.5%), DDL LLC (33.229%), David LaFave (12.083%), the David L. Kirshenbaum Revocable Trust dated February 29, 1996, David L. Kirshenbaum, trustee (6.042%), Thomas H. Fraerman (3.021%), and Donald R. James (18.125%). Donald R. James is the Manager of MW Group. Laurance Realty Associates performs the day-to-day management. Laurance Realty is effectively owned by these MW Group affiliates: DDL LLC, David LaFave, and James. MW Group LLC filed for Chapter 11 bankruptcy (Bankr. W.D.N.C. Case No. 11-32674) on Oct. 21, 2011, to stave off foreclosure attempts by lender, Bank of America N.A. The Debtor scheduled assets of $10.32 million and liabilities of $8.42 million. Donald R. James signed the petition as manager. No official committee of unsecured creditors has been appointed in the case. The Honorable George R. Hodges, United States Bankruptcy Judge, initially presided over the case, but the case was subsequently transferred to the Honorable Laura T. Beyer, United States Bankruptcy Judge, who has presided over this chapter 11 case since her appointment. MW Group is represented by Moon Wright & Houston, PLLC's Travis W. Moon, Esq., and Andrew T. Houston, Esq. Bank of America, N.A., successor by merger to LaSalle Bank National Association, is represented in the case by D. Kyle Deak, Esq., at Troutman Sanders LLP; and Gus A. Paloian, Esq., Jason J. DeJonker, Esq., and Shuman Sohrn, Esq., at Seyfarth Shaw LLP. NATIONAL ENVELOPE: Plan Filing Period Extended to April 7 --------------------------------------------------------- NE OPCO, Inc. et al., formerly known as National Envelope, sought and obtained an extension of their exclusive periods to file a Chapter 11 plan and solicit acceptances of that plan to April 7, 2014, and June 5, 2014, respectively. The Debtors said that at the outset of these large and complex cases, they made their intentions to sell their assets and to maximize the recovery for their creditors known. The Debtors said in a Jan. 6, 2013 court filing that to date, they have exhausted all efforts in accomplishing successful asset sales and have (a) garnered the support of their key stakeholders in their efforts to date, (b) marketed and sold substantially all of their assets to three separate purchasers, (c) assisted the asset purchasers in the transition of their former assets, (d) facilitated the continued employment of approximately 95% of their former workforce by one of the asset purchasers, and (e) completed a bar date process. "The Debtors are now well-situated to evaluate their financial standing in an effort to determine the most appropriate resolution of these cases. However, they require additional time to complete this analysis," said William A. Romanowicz, Esq., at Richards, Layton & Finger, P.A., counsel for the Debtors. About NE OPCO, Inc. National Envelope is the largest privately-held manufacturer of envelopes in North America. Headquartered in Frisco, Texas, National Envelope has eight plants and 15 percent of the envelope market. Revenue of $427 million in 2012 resulted in a $60.1 million net loss, continuing an unbroken string of losses since 2007. NE OPCO, Inc., doing business as National Envelope, along with affiliate NEV Credit Holdings, Inc., filed petitions seeking relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 13-11483) on June 10, 2013. The company disclosed liabilities including $148.4 million in secured debt, with $37.5 million owing on a revolving credit and $15.6 million on a secured term loan. There is a $55.7 million second-lien debt 82 percent held by a Gores Group LLC affiliate. National Envelope, then known as NEC Holdings Corp., first sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 10-11890) on June 10, 2010. The business was bought by Gores Group LLC for $208 million in a bankruptcy sale. National Envelope, through NE OPCO, has returned to bankruptcy to pursue a plan of reorganization or sell the assets as a going concern via 11 U.S.C. Sec. 363. The Debtor plans to facilitate a sale of the business with publicly traded competitor Cenveo Inc. In the new Chapter 11 case, the company has tapped the law firm Richards, Layton & Finger as counsel, PricewaterhouseCoopers LLP as financial adviser, and Epiq Bankruptcy Solutions as claims and notice agent. The Gores Group is represented by Weil, Gotshal and Manges LLP and Lowenstein Landler LLP. Salus Capital Partners, the DIP agent, is represented by Choate, Hall & Stewart LLP and Morris Nichols Arsht & Tunnell LLP. Wells Fargo Capital Finance, LLC, the prepetition senior agent, is represented by Goldberg Kohn Ltd and DLA Piper. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP's Laura Davis Jones, Esq., Bradford J. Sandier, Esq., Robert J. Feinstein, Esq., and Peter J. Keane, Esq. Guggenheim Securities, LLC, serves as its investment banker and financial advisor. National Envelope won court approval on July 19, 2013, for a global settlement permitting a sale of the company without objection from the official unsecured creditors' committee. The settlement ensures some recovery for unsecured creditors. The Company also won final approval for $67.5 million in bankruptcy financing being supplied by Salus Capital Partners LLC. Judge Sontchi authorized three buyers to acquire Frisco, Texas- based National Envelope's business for a total of about $70 million. Connecticut-based printer Cenveo Inc. acquired National Envelope's operating assets for $25 million, Hilco Receivables LLC picked up accounts receivable for $25 million and Southern Paper LLC took on its inventory for $15 million. NATURAL MOLECULAR: Wants to File Chapter 11 Plan Until May 30 ------------------------------------------------------------- Natural Molecular Testing Corporation asks the U.S. Bankruptcy Court for the Western District of Washington to extend its exclusive period to file a Chapter 11 plan of reorganization until May 30, 2014. The Debtor tells the Court that extending the exclusivity period will allow "an unfettered opportunity" to draft a confirmable plan of reorganization without the burden of responding to competing plans. An extension allows the Debtor "a level of focus" that cannot occur if the Debtor must split its attention, says Elizabeth H. Shea, Esq., at Hacker & Willig Inc. P.S. Ms. Shea says, as demonstrated by the record in the case, the unsecured creditor's committee has been very active in the bankruptcy and may seek to propose its own plan prior to May 30, 2014, absent an extension of the exclusivity period. However, any competing plan will only serve to increase attorneys' fees and costs for all parties-in-interest and provide unnecessary distractions, she adds. Natural Molecular Testing Corp., which provides molecular diagnostic-testing services, including testing for sexually transmitted diseases and screening and counseling about cystic fibrosis, filed a petition for Chapter 11 protection (Bankr. W.D. Wash. Case No. 13-19298) on Oct. 21, 2013, in Seattle. Hacker & Willig, Inc., P.S., serves as its bankruptcy counsel. The closely held company said assets are worth more than $100 million while debt is less than $50 million. Gail Brehm Geiger, Acting U.S. Trustee for Region 18, appointed a five-member Committee of Unsecured Creditors. Foster Pepper's Jane Pearson, Esq.; Christopher M. Alston, Esq., and Terrance Keenan, Esq., serve as the Committee's attorneys. NATURAL PORK: Files Joint Liquidation Plan ------------------------------------------ Natural Pork Production, II, LLP, et al., filed a Liquidating Plan and accompanying Disclosure Statement dated Jan. 21, 2014 to the U.S. Bankruptcy Court for the Southern District of Iowa. Natural Pork commenced its Chapter 11 petition on Sept. 11, 2012. Wholly owned subsidiaries Crawfordsville LLC, Brayton LLC, North Harlan LLC and South Harlan LLC filed their own Chap. 11 petitions on Dec. 7, 2012. All five cases are not jointly administered, but the Joint Plan proposes that the cases be substantively consolidated upon confirmation. The Natural Pork case is designated as the lead case. Upon confirmation, the Natural Pork case will be the sole surviving Reorganized Debtor while the other four Debtor cases will be dissolved, liquidation and their bankruptcy cases closed. Through the liquidation of assets during the pendency of the bankruptcy cases, the Debtors believe they will have sufficient cash on hand to pay all creditors in full, with some receiving interest on their claims, on the Plan Effective Date. The Debtors have disputed, will continue to dispute, and will seek a judicial determination of disallowance, of the alleged Secured Claims of the Inter-Creditor Committee, individually and collectively on behalf of the signatories to the Settlement and Intercreditor Agreement (SIA Parties). The SIA Parties who held Sub Debt Notes and received a payment from the January 2012 Distribution, will have the amounts they received re-characterized from partial return of their equity investment in Natural Pork to a repayment of their Sub Debt Notes, for tax purposes. For those SIA Parties who received a payment from the January 2012 Distribution and the amount was less than the amount of their Sub Debt Note Claim on the Petition Date, they will get to keep their earlier January 2012 Distribution, and receive a further Distribution under the Joint Plan, so that their Sub Debt Note Claim will be paid in full, but without postpetition interest. They will also be dismissed from all the Adversary Proceedings. Those SIA Parties who were Sub Debt Note holders and received a payment from the January 2012 Distribution in an amount exceeding their respective Sub Debt Note Claim as of the Petition Date, will also get to keep their earlier payment and be dismissed from all the Adversary Proceedings, provided they consensually disgorge all amounts in excess of their Sub Debt Note Claim, on or before the Effective Date. Those SIA Parties who did not hold Sub Debt Notes but received a payment from the January 2012 Distribution will be compelled to disgorge all amounts they received from the January 2012 Distribution. Natural Pork will amend all of its previously filed 2011 and 2012 state and federal tax returns, and corresponding Schedule K-1's, to re-characterize the January 2012 Distribution as a repayment of debt rather than a partial return of equity. The Debtors anticipate that after payment in full on the Allowed Claims of Creditors, there will be a dividend paid to Equity Interest holders, both Current Equity Interest holders and Dissociated Equity Interest holders. Claim Classes 1, 2, 3, 4, 5, 7, 8, 9, 10 and 11 are Unimpaired. Classes 6, 12, 13 and 14 are Impaired. The Joint Plan was signed by Managing Member Lawrence Handlos. A copy of the proposed Disclosure Statement is available for free at http://bankrupt.com/misc/NATURALPORKds.pdf About Natural Pork Hog raiser Natural Pork Production II, LLP, filed for Chapter 11 bankruptcy (Bankr. S.D. Iowa Case No. 12-02872) on Sept. 11, 2012, in Des Moines. The Company formerly did business as Natural Pork Production, LLC. It does business as Crawfordsville, LLC, Brayton, LLC, South Harlan, LLC, and North Harlan, LLC. The Debtor disclosed $31.9 million in asset and $27.9 million in liabilities, including $7.49 million of secured debt in its schedules. Bankruptcy Judge Anita L. Shodeen oversees the case. Donald F. Neiman, Esq., and Jeffrey D. Goetz, Esq., at Bradshaw, Fowler, Proctor & Fairgrave, P.C., in Des Moines, Iowa, represent the Debtor as general reorganization counsel. Attorneys at Davis, Brown, Koehn, Shors & Roberts, P.C., in Des Moines, Iowa, represent the Debtor as special litigation counsel. Attorneys at Sugar, Felsenthal Grais & Hammer LLP, in Chicago, represent the Official Committee of Unsecured Creditors. Robert C Gainer, Esq. at Cutler Law Firm, P.C., in West Des Moines, Iowa, represent the Committee as associate counsel. Conway MacKenzie, Inc., serves as its financial advisor. Gary W. Koch, Esq., and Michael S. Dove, Esq., represent AgStar Financial Services, ACA, and AgStar Financial Services, FLCA, as counsel. Michael P. Mallaney, Esq., at Hudson Mallaney Schindler & Anderson, in West Des Moines, Iowa, represents the IC Committee as counsel. NMP-GROUP: Plan Declared Effected in October Last Year ------------------------------------------------------ The First Amended Plan of Liquidation of NMP-Group LLC was declared effective last Oct. 28, 2013. The U.S. Bankruptcy Court for the Southern District of New York previously entered an order approving the First Amended Disclosure Statement and confirming the First Amended Plan on Oct. 23, 2013. As reported on the Aug. 29, 2013 edition of The Troubled Company Reporter, the Plan designates six classes of claims and interests -- Class 1 Real Estate Tax and Other In rem Governmental Lien Claims, Class 2 Mortgagee Claims estimated to total $51.64 million, Class 3 Subordinate Lien Claims, Class 4 Other Priority Claims, Class 5 General Unsecured Claims and Class 6 Equity Interests. All the claim classes are unimpaired and claimholders are expected to have 100% recovery on their claims. The Plan embodies a sale of the Debtor's property to Madison 33 Owner LLC for $51,878,784, subject to adjustments. The sale proceeds will be used to satisfy the Class 1 and 2 Claims. The Purchaser has agreed to assume the payment of (i) any Allowed General Unsecured Claim that is not paid by the Debtor because the Purchase Price is otherwise insufficient to pay in full all of the Claims secured by the Property, all of the Allowed Administrative Claims, and all such Allowed General Unsecured Claims, and (ii) administrative claims for attorneys' fees that are approved by the Bankruptcy Court, that exceed $100,000 in amount (but not to exceed $2,000,000 in the aggregate), and that cannot be paid from the Purchase Price. About NMP-Group NMP-Group LLC, the owner of 21 East 33rd Street in Manhattan, filed a petition for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 13-bk-12269) on July 10, 2013, in New York to prevent a foreclosure sale. Ilana Volkov, Esq. -- ivolkov@coleschotz.com -- and Felice R. Yudkin, Esq. -- fyudkin@coleschotz.com -- at Cole, Schotz, Meisel, Forman & Leonard, P.A., represent the Debtor. The U.S. Trustee has not formed a creditors' committee due to lack of interest of creditors to serve in a committee. OLEO E GAS: Gets $215 Million Investment ---------------------------------------- Luciana Magalhaes, writing for The Wall Street Journal, reported that a group of bondholders of Brazil's Eike Batista's struggling oil firm have agreed to invest $215 million in the company as part of a restructuring plan to try to help it emerge from bankruptcy proceedings, the firm confirmed late night on Feb. 7. According to the report, the agreement signed on Feb. 7 is part of a bankruptcy protection plan for Oleo e Gas Participacoes SA -- formerly known as OGX Petroleo e Gas Participacoes SA -- which will now be presented to a judge by Feb. 17, according to a person familiar with the company's plans. It is the third delay, the report pointed out. OGP had initially said it would present the recovery plan by Jan. 24. Then it pushed the deadline back to Jan. 31 and, after, to Feb. 7. The $215 million investment will initially be made through debt which will later be converted into shares representing a 65% stake in the company after its restructuring process is completed, OGP said, the report related. OGP, once the backbone of Mr. Batista's industrial empire, ran into financial trouble over the last 18 months after its first oil wells failed to produce as much oil as had been expected, the report further related. The company filed for court protection in late October, in one of Latin America's largest corporate collapses. About OGX Petroleo Based in Rio de Janeiro, Brazil, OGX Petroleo e Gas Participaaoes S.A. is an independent exploration and production company with operations in Latin America. OGX filed for bankruptcy in a business tribunal in Rio de Janeiro on Oct. 30, 2013, case number 0377620-56.2013.8.19.0001. The bankruptcy filing puts $3.6 billion of dollar bonds into default in the largest corporate debt debacle on record in Latin America. The filing by the oil company that transformed Eike Batista into Brazil's richest man followed a 16-month decline that wiped out more than $30 billion of his personal fortune. The filing, which in Brazil is called a judicial recovery, follows months of negotiations to restructure the dollar bonds, in which OGX sought to convert debt to equity and secure as much as $500 million in new funds. OGX said Oct. 29 that the talks concluded without an agreement. The company's cash fell to about $82 million at the end of September, not enough to sustain operations further than December. ORLANDO CITY, FL: S&P Affirms 'CC' Bond Rating, Outlook Stable -------------------------------------------------------------- Standard & Poor's Ratings Services has revised its outlook on the City of Orlando, Fla.'s series 2008C (third-lien) tourist development tax (TDT) revenue bonds to stable from negative. At the same time, Standard & Poor's has affirmed its 'CC' underlying rating (SPUR) on the bonds. "We base the outlook revision on our expectation that the city will have sufficient pledged revenues and a debt service reserve fund balance to cover future series C debt service payments," said Standard & Poor's credit analyst Richard Marino. Standard & Poor's also affirmed its 'BB' SPUR on Orlando's 2008A (first-lien) tourist development tax (TDT) bonds and its 'CCC' SPUR on the city's series 2008B TDT (second-lien) bonds. The outlook on both is stable. The notching of the ratings among the three series reflects their lien priority and the level of debt outstanding within each lien, which magnifies the impact of even a modest decrease in revenues. The notching further reflects S&P's view of the level of sustained pledged revenue growth it believes would likely be needed to provide at least 1x annual debt service coverage at each lien. Securing the bonds is a lien on net proceeds from the city's share (50%) of the sixth-cent TDT enacted on Sept. 1, 2006, and levied on each dollar charged for tourist rentals within Orange County. The series A bonds have a senior lien on the pledged revenues while the series B and C bonds have second and third liens, respectively. The stable outlook on the series 2008A and 2008B bonds is based on S&P's expectation of adequate coverage of the respective liens. However, should economic conditions weaken substantially and TDT revenues correspondingly decrease, S&P could lower the ratings on the series 2008A and 2008B bonds. A sustained growth in pledged revenues resulting in an increase in debt service coverage to good levels could pressure the rating upward for the series 2008A and 2008B bonds. The stable outlook on the series C bonds reflects S&P's expectation that the combined pledged revenues and debt service reserve fund will be sufficient to fulfill their debt service requirements. S&P expects that the sustained pledged revenue growth will aid Orlando in rebuilding its debt service and liquidity reserve fund balance to indenture required levels. Therefore, S&P do not see any upward rating pressure within the outlook horizon. However, any negative growth in pledged revenues could pressure the rating downward due to the highly leveraged nature of series C bonds. OSHKOSH CORP: S&P Rates $250MM Sr. Unsecured Notes 'BB+' -------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' rating to Oshkosh, Wisc.-based Oshkosh Corp.'s proposed $250 million senior unsecured notes. The recovery rating on the notes is '3', indicating S&P's expectation for meaningful (50%-70%) recovery in the event of a payment default. Oshkosh intends to use the proceeds from the notes, along with available cash, to redeem its outstanding $250 million unsecured notes due 2017. The rating on Oshkosh reflects its "fair" business risk profile and "intermediate" financial risk profile. In December 2013, S&P raised its ratings on Oshkosh, including the corporate credit rating to 'BB+' from 'BB'. The upgrades reflected the company's good overall operating performance, including its improved profitability, and disciplined financial policy, which includes targeted reported debt to EBITDA of 1x-2x. S&P believes Oshkosh's financial policy supports an "intermediate" financial risk profile after accounting for the company's potential cash flow and leverage volatility. S&P's assessment of the company's business risk profile as "fair" reflects its market-leading positions in most end-markets, its good scale and scope, as well as S&P's view that its profitability is volatile and relatively low for a company in the capital goods sector, despite recent improvement. RATINGS LIST Oshkosh Corp. Corporate credit rating BB+/Stable/-- New Rating Oshkosh Corp. $250 million senior unsecured notes BB+ Recovery rating 3 PAYPAL INC: Buyout Firms Gear Up for a Swipe at Firm ---------------------------------------------------- Jonathan Marino, writing for The Deal, reported that private equity wants PayPal Inc. but a combination of a bevy of bidders, as well as the industry's newfound disdain for club deals, could push an asset valued at more than $35 billion just out of their range. According to the report, with activist Carl Icahn rattling his saber at owner eBay Inc.'s digital gates and the company facing lackluster stock performance, a spinout into private ownership for PayPal could be the optimal move. More than a decade after eBay's acquisition of PayPal (then, at a comparatively paltry $1.2 billion), the asset's dependence on the marketplace has been turned into eBay's reliance on its subsidiary, now a fully developed technology company that is fully capable of standing on its own. There's only one thing standing in private equity's way: Everyone else, the report pointed out. Sources said that, while they expected PE players to perk up their ears if and when PayPal hits the block, many potential big technology bidders -- Google Inc., Apple Inc., even Facebook Inc. -- would have traditional payment processors and credit card companies -- Visa Inc. and American Express Co. -- nipping at their heels in a rush to outbid each other. "It's a rare asset because you can expect that guys from a number of sectors will come out," one banker told The Deal. Still, if there were a time for PE firms to take another stab at a more successful version of a leveraged buyout approaching $40 billion, factors are aligned for that to happen now, more than at any other point in recent history, the report said. PRM FAMILY: Court Okays Private Sale of Assets ---------------------------------------------- The Hon. Sarah S. Curley of the U.S. Bankruptcy Court for the District of Arizona entered on Feb. 6, 2014, an order authorizing the private sale of substantially all assets of PRM Family Holding Company, L.L.C., et al. As reported by the Troubled Company Reporter on Jan. 20, 2014, the Debtors intend to sell all of their assets to Cardenas Northgate (CNG). In papers filed in Court on Dec. 2, CNG sought the right to credit bid the full amount of claims acquired from Bank of America, the Debtors' largest secured creditor. CNG is expected to pay approximately $53,600,000 (approximately $39,600,000 based on the prepetition Bank of America claim and $14,000,000 cash in new capital for the Debtors' estates) to close the transaction. The $14,000,000 in new capital will be used to satisfy all PACA/PASA trust claims, pay administrative expenses and transactional closing costs. Wells Fargo Equipment Finance, Inc., had objected to the sale, saying that the Court must deny the sale and assumption motion to the extent that it seeks to affect in any way WFEFI's rights in connection with the leases. In a filing dated Jan. 27, 2014, the Official Committee of Unsecured Creditors expressed its support on the sale motion, stating that it believes that a private sale to CNG represents the highest and best opportunity for the Debtors to maximize the value of their estates. The Debtors and the Committee are in the process of drafting a joint plan of liquidation which is premised upon the approval of the sale motion, and the successful sale of substantially all of the Debtors' assets to CNG. The Committee believes that the sale motion and the forthcoming plan of liquidation offers the best (if not the only) option for a resolution of these bankruptcy cases and will maximize the value of the Debtors' estates for the benefit of the Debtors' creditors, including unsecured creditors. About PRM Family PRM Family Holding Company, L.L.C., operator of 11 Pro's Ranch Markets grocery stores in Arizona and Texas and New Mexico, sought Chapter 11 protection (Bankr. D. Ariz. Case No. 13-09026) on May 28, 2013. As of the bankruptcy filing, PRM Family Holding operates seven grocery stores in Phoenix, two in El Paso, Texas, and two in New Mexico. Its corporate office is in California and it has warehouses and distribution facilities in California and Phoenix. Its Pro's Ranch Markets feature produce, baked goods, and other general grocery items with a Hispanic flair and theme. The company has more than 2,200 employees. PRM Family blamed its woes on, among other things, the adverse effect of the perception in Arizona towards immigrants including the passage of SB 1070 and an immigration audit to which no other competitor was subjected. It also blamed a decline in the U.S. economy and an increase competition from other grocery store chains. Bank of America, the secured lender, declared a default in February 2013. PRM Family estimated liabilities in excess of $10 million. Judge Sarah Sharer Curley oversees the case. Michael McGrath, Esq., Scott H. Gan, Esq., Frederick J. Petersen, Esq., Kasey C. Nye, Esq., David J. Hindman, Esq., and Isaac D. Rothschild, Esq., at Mesch, Clark & Rothschild, P.C., serve as the Debtor's counsel. HG Capital Partners' Jim Ameduri serves as financial advisor. PRM Family submitted to the Bankruptcy Court on Sept. 23, 2013, a Joint Disclosure Statement in support of Plan of Reorganization. The Disclosure Statement says the Debtor will continue the operation of a long-standing business, which currently employs approximately 2,300 people. Continuing the business will allow the Debtors to repay creditors and maintain trading relationships with long-term trade vendors. Attorneys at Freeborn & Peters LLP, in Chicago, Ill., represent the Official Committee of Unsecured Creditors as lead counsel. Attorneys at Schian Walker, P.L.C., in Phoenix, Arizona, represent the Committee as local counsel. O'Keefe & Associates Consulting, LLC, serves as financial advisor to the Committee. Robert J. Miller, Esq., Bryce A. Suzuki, Esq., and Justin A. Sabin, Esq., at Bryan Cave LLP, in Phoenix, serve as counsel for Bank of America, N.A., as administrative agent and a lender under an amended and restated credit agreement dated July 1, 2011. RENT-A-CENTER: Hoping To Pay A Dividend, Will Refinance ------------------------------------------------------- Lisa Allen, writing for The Deal, reported that Rent-A-Center Inc. announced on Feb. 6 that it intends to refinance its senior credit facility with $850 million in new debt, as the largest rent-to-own business in North America tries to boost its financial position and get the go-ahead to pay a shareholder dividend amid concerns about its performance, liquidity, and debt covenant compliance. According to the report, the Plano, Tex.-based company, which allows customers to lease products such as electronics, appliances, furniture, and accessories under rental purchase agreements with no long-term obligation, hopes to replace its existing $687.5 million credit facility with a $350 million term loan and a $500 million revolving credit facility. Rent-A-Center wants to arrange the new financing by the end of this year's first quarter, the report said. The company plans to repay the $348 million outstanding under its existing senior credit facility with proceeds from a new term loan. The current senior secured credit facility, which matures on July 14, 2016, has two parts: a $500 million revolver with $212.5 million drawn as of Sept. 30, and a $250 million term loan, the report related. The interest rate on that facility is either the prime rate plus 0.5% to 1.5%, or the Eurodollar rate plus 1.5% to 2.5%, the report further related. * * * The Feb. 6, 2014, edition of The Troubled Company Reporter said that Moody's Investors Service downgraded Rent-A-Center, Inc.'s debt ratings, including its Corporate Family Rating to Ba3 from Ba2 and Probability of Default rating to Ba3-PD from Ba2-PD. The ratings were placed on review for further downgrade. Moody's also assigned a SGL-4 Speculative Grade Liquidity Rating reflecting weak liquidity, which stems from Moody's expectation for negative free cash flow over the next twelve months and tenuous covenant cushion. RESIDENTIAL CAPITAL: Judge Approves $2 Million Bonus for Chief -------------------------------------------------------------- Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York authorized Residential Capital, LLC, et al., to pay a $2 million success fee to Lewis Kruger, the Debtors' Chief Restructuring Officer. Judge Glenn overruled the objections of the U.S. Trustee, which argued that the success fee is not reasonable under Section 330 of the Bankruptcy Code because when combined with the CRO's monthly compensation, the blended hourly rate is unreasonable. In support of his approval, Judge Glenn stated, "in this case, Kruger played a 'vital and indispensable role' in the Debtors' reorganization. This was an extremely complicated and contentious case. . . The case was nearly in a free-fall before Kruger's appointment as CRO. The two events that finally moved the process along were Judge Peck's appointment as mediator and Kruger's appointment as CRO, ultimately leading to a largely consensual chapter 11 plan." Judge Glenn added that through Kruger was not solely responsible for the success of the case, Section 330 of the Bankruptcy Code does not require sole responsibility. Moreover, Judge Glenn found that the Debtors have provided evidence that the $2.0 million success fee is well within market standards, considering the Debtors' asset size, amount of liabilities, and the measure of value creation, and savings, to the estates. 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. Judge Martin Glenn in December 2013 confirmed the Joint Chapter 11 Plan co-proposed by Residential Capital and the Official Committee of Unsecured Creditors. REVOLUTION DAIRY: Court Issues Confirmation Order ------------------------------------------------- Judge R. Kimball Mosier entered on Nov. 1, 2013, an order confirming the Joint Chapter 11 Plan of Revolution Dairy, LLC, et al., modified as of Oct. 10, 2013. The effective date of the Plan was deemed to be Oct. 31, 2013. The Plan contemplates the formation of Bliss LLC. On or before the Effective Date, Robert E. Bliss, Timothy S. Bliss, Michael Bliss, and Justin Bliss will organize Bliss LLC into which Revolution Dairy, LLC and Highline Dairy, LLC will merge. Timothy S. Bliss will be the initial manager of Bliss LLC. All Bliss Dairy Assets and all assets of Revolution and Highline will be transferred and assigned free and clear of liens, claims, and interests, to Bliss LLC on the Effective Date. These transfers will be effected by merger of Revolution and Highline into Bliss LLC or by appropriate transfer documents. Bliss LLC will, in turn, assume the obligation to pay all Bliss Dairy Debts and all of Revolution's and Highline's debts according to the terms of the Plan. Allowed Claims (except for the Bliss Residence Mortgage which will be paid by Bliss from post-Confirmation wages and social security income) will be paid in full under the Plan by Bliss LLC. Treatment of Secured Claims consists of modification of prepetition payment obligations (primarily as to term and interest rate), execution of a new note by Bliss LLC evidencing the modified obligation, and retention of prepetition liens. The Plan proposes payment in full of each of the unsecured claims but in different time frames. A copy of the Confirmation Order is available for free at: http://bankrupt.com/misc/REVOLUTIONDAIRYplanorder.pdf Adam Affleck, Esq. -- asa@pyglaw.com -- and Ted Cundick, Esq. -- tec@princeyeates.com -- of Prince, Yeates & Geldzahler appeared on behalf of Revolution Dairy, LLC. George Hoffman, Esq. -- gbh@pkhlawyers.com -- of Parsons Kinghorn Harris appeared on behalf of Highline Dairy, LLC. David Berry, Esq. -- slc@berrytripp.com -- of Berry & Tripp P.C. appeared on behalf of Robert and Judith Bliss dba Bliss Dairy. Troy Aramburu, Esq. -- taramburu@swlaw.com -- and Blakely Denny, Esq. -- bdenny@swlaw.com -- appeared on behalf of the Official Unsecured Creditors' Committee. Michael Johnson, Esq. -- mjohnson@rqn.com -- appeared on behalf of Rabo Agrifinance, Inc. Danny Kelly, Esq. -- dckelly@stoel.com -- appeared on behalf of Metropolitan Life Insurance Company. George Pratt appeared on behalf of Bank of the West. Sherilyn Olsen appeared on bhalf of John Deere Financial and Wells Fargo Equipment Finance. Vince Cameron -- Vince.Cameron@usdoj.gov -- appeared on behalf of the U.S. Trustee. About Revolution Dairy Revolution Dairy LLC is one of the largest dairy farms in Utah. Revolution Dairy and affiliate Highline Dairy, LLC, filed bare- bones Chapter 11 petitions (Bankr. D. Utah Case Nos. 13-20770 and 13-20771) in Salt Lake City on Jan. 27, 2013. Each of the Debtors estimated $10 million to $50 million in assets and liabilities. Managers of Revolution and Highline -- Robert and Judith Bliss -- also sought Chapter 11 protection (Case No. 13-20772). Revolution Dairy, LLC, is represented by Michael N. Zundel, Esq., Adam S. Affleck, Esq., and T. Edward Cundick, Esq., at Prince, Yeates & Geldzahler. Highline Dairy, LLC, is represented by George B. Hoffman, Esq., at Parsons Kinghorn & Harris. Robert and Judith Bliss are represented by David T. Berry, Esq., at Berry & Tripp P.C. The Debtors' cases are jointly administered under Case No. 13-20770. The U.S. Trustee appointed five members to the official committee of unsecured creditors. The Committee tapped Snell and Wilmer L.L.P. as its counsel. Berkeley Research Group LLC serves as the panel's financial advisor. REXNORD LLC: S&P Raises Corp. Credit Rating to BB-, Outlook Stable ------------------------------------------------------------------ Standard & Poor's Ratings Services raised its ratings on Milwaukee, Wis.-based industrial machinery manufacturer Rexnord LLC, including the corporate credit rating to 'BB-' from 'B+'. The outlook is stable. The recovery ratings on the company's senior secured credit facilities and senior unsecured notes remain unchanged. "The upgrade reflects Apollo Management L.P. and its affiliates' reduced ownership of publicly traded Rexnord Corp. (Rexnord LLC's ultimate parent) to about 42% from about 56% and our view that Rexnord's good operating performance will support continued credit measure improvement," said Standard & Poor's credit analyst Dan Picciotto. "We view Apollo Management's sale as a positive step because it reduces risks related to Rexnord pursuing a more aggressive financial policy." Rexnord's credit measures have improved to levels commensurate with an "aggressive" financial risk profile, and we expect continued improvement in light of broadly favorable end-market conditions. In addition, as part of the share offering, Rexnord Corp. sold three million shares (which generated more than $75 million) to bolster its cash balances and provide some additional financial flexibility". The outlook is stable. S&P expects that Rexnord's credit measures will continue to improve against a backdrop of a slow growth conditions for its business segments while meeting levels that are appropriate for an "aggressive" financial risk profile, including debt to EBITDA of less than 5x and funds from operations to debt of more than 12%. S&P could raise the rating if Apollo Management continues its exit of Rexnord and if it expects Rexnord to maintain credit measures appropriate for a higher financial risk profile assessment ("significant" instead of "aggressive"), including debt to EBITDA of less than 4x. S&P could lower the rating if it do not expect Rexnord to maintain debt to EBITDA of less than 5x. This could occur if market downturn or operational weakness result in declining revenues and margin deterioration and the company did not use cash to reduce debt levels. SHELBOURNE NORTH: Seeks Court Nod on Plan Investment Agreement -------------------------------------------------------------- Shelbourne North Water Street L.P., the owner of the site of the Chicago Spire at 400 N. Lake Shore Drive, filed a motion for approval of a plan investment agreement on Feb. 7 in the U.S. Bankruptcy Court. The plan investment agreement was developed with Atlas Apartment Holdings LLC, a major international residential developer and apartment owner headquartered in Chicago. Shelbourne has the exclusive right to file a plan of reorganization through March 10, 2014. The plan investment agreement provides for up to $135 million of funding for a plan of reorganization that will pay all bona fide claims in full. This plan of reorganization will enable Shelbourne to emerge from bankruptcy and with Atlas to move forward with the Chicago Spire, the 2,000 foot high residential building at the intersection of the Chicago River and Lake Michigan. Before the recession, the vertical foundations of the tower and underground garage had been completed, as had the ramps to lower Lake Shore Drive. Steven Ivankovich, the CEO of Atlas, said, "We have been working with Garrett Kelleher over the past several months and now share his belief and vision in the Chicago Spire. This is a building that deserves to be built and built in Chicago. Atlas is committed to making this happen. The Spire will offer a very high end product to a demanding local and international public." Garrett Kelleher, the managing member of Shelbourne, said, "Given the ongoing recovery in the Chicago property market, the timing is better now than when this project commenced. I am delighted to have found a partner who believes in the project as passionately as I do." Tom Villanova, head of the Chicago Building Trades Council, said: "We have been waiting for this day. We look forward to a project that will provide over 15,000 construction jobs. Restarting this project will be a game changer for Chicago." About Shelbourne North Water Street L.P. A group of creditors filed an involuntary Chapter 11 petition against Chicago, Illinois-based Shelbourne North Water Street L.P. on Oct. 10, 2013 (Bankr. D. Del. Case No. 13-12652). The case is assigned to Judge Kevin J. Carey. The petitioners are represented by Zachary I Shapiro, Esq., and Russell C. Silberglied, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware. The Debtor consented on Nov. 8, 2013, to being in Chapter 11 reorganization. FrankGecker LLP represents the Debtor in its restructuring efforts. SHELBOURNE NORTH: Developer Finds Investor to Restart Project ------------------------------------------------------------- Jacqueline Palank, writing for The Wall Street Journal, reported that developer Garrett Kelleher has found an investor to help him pay off the debts on his stalled Chicago Spire project and complete construction of the high-rise condominium, which would be the tallest building in the Western Hemisphere. According to a Feb. 6 filing in the developer's bankruptcy case, Atlas Apartment Holdings LLC of Chicago will provide up to $135 million in new capital to fund the developer's Chapter 11 plan of reorganization, the report related. The investment from Atlas, an arm of multifamily apartment company Atlas Residential Management, would allow Mr. Kelleher's company to pay creditors in full and exit bankruptcy protection, the report further related. The developer hopes to secure court approval of a bankruptcy-exit plan, which hasn't been filed yet, by Aug. 31 and emerge from bankruptcy by Oct. 31. "After thorough evaluation, the debtor believes that entry into the plan agreement represents the best available opportunity for the debtor to complete its reorganization while maximizing the value of the debtor's assets for the benefit of its creditors," attorneys for Mr. Kelleher's company, Shelbourne North Water Street LP, said in court papers, the report cited. Atlas Chief Executive Steven Ivankovich told The Wall Street Journal on Feb. 7 that his firm hopes to partner with Mr. Kelleher's company to ensure that construction of the Chicago Spire is completed. He said the project's 2.2-acre site on Chicago's Lake Shore Drive is "possibly the best residential development land in all of North America, if not the world." About Shelbourne North Water Street L.P. A group of creditors filed an involuntary Chapter 11 petition against Chicago, Illinois-based Shelbourne North Water Street L.P. on Oct. 10, 2013 (Bankr. D. Del. Case No. 13-12652). The case is assigned to Judge Kevin J. Carey. The petitioners are represented by Zachary I Shapiro, Esq., and Russell C. Silberglied, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware. The Debtor consented on Nov. 8, 2013, to being in Chapter 11 reorganization pursuant to a settlement, which also requires transferring the case from Delaware to Chicago. FrankGecker LLP represents the Debtor in its restructuring efforts. SHOTWELL LANDFILL: Files Schedules of Assets and Liabilities ------------------------------------------------------------ Shotwell Landfill, Inc., filed with the Bankruptcy Court for the Eastern District of North Carolina its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ----------- ----------- A. Real Property $2,900,000 B. Personal Property $20,335,236 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 $373,095 ----------- ----------- TOTAL $23,235,236 $10,048,364 The Debtor amends its Schedule B and Summary of Schedules to disclose the following personal property: -- 2002 International 4300 18' Flatbed truck with hoist Value: $20,000.00 -- 2005 Chevrolet Silverado C1500 Value: $3,500.00 -- 2001 Mack RD600 Truck Value: $25,000.00 -- 2005 Mack YA-84730 Truck Value: $75,000.00 -- 2002 Volvo 37' roll off truck with hoist Value: $67,000.00 -- 2002 Proline Trailer Value: $1,000.00 -- 1996 Ford Truck (used for parts) Value: $0.00 Total: $191,500.00 About Shotwell Landfill 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. 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. The Debtor disclosed $23,027,736 in assets and $10,039,308 in liabilities as of the Chapter 11 filing. In its amended schedules, the Debtor disclosed $23,043,736 in assets and $10,048,364 in liabilities as of the Chapter 11 filing. SHUANEY IRREVOCABLE: Denies US Trustee's Bid for Ch. 7 Conversion ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Florida has denied the motion of Guy G. Gebhardt, Acting United States Trustee for Region 21, to convert the Chapter 11 case of Shuaney Irrevocable Trust to a liquidation under Chapter 7. As reported by the Troubled Company Reporter on Feb. 7, 2014, the Court dismissed, at the behest of Beach Community Bank, the Debtor's Chapter 11 case, subject to payment of quarterly fees to the U.S. Trustee. When the fees remain unpaid despite several efforts to obtain payment of the fees for the fourth quarter of 2013 by the U.S. Trustee, and no order dismissing the case was entered, the U.S. Trustee asked for the conversion of the case to Chapter 7. On Feb. 5, 2014, Beach Community -- the single largest secured creditor in this case and has, by virtue of numerous security agreements and mortgages, "locked up" virtually every asset of any value in which the Debtor claims an interest as collateral for the Debtor's indebtedness to Beach Community -- asked the Court to deny the U.S. Trustee's conversion motion. "While the U.S. Trustee reiterates the Debtor's stated position that the Debtor has no monies to pay these fees, and then noting that the Debtor has on deposit with Beach Community Bank funds in which Beach 'may hold a security interest' and it further appearing that Beach is not willing to allow the Debtor to use funds that 'may be' subject to a security interest to pay the quarterly fees, the U.S. Trustee fails to acknowledge that this Court has already determined as a matter of law that the funds on deposit with Beach are indeed the bank's cash collateral. Therefore, there is no question but that Beach holds a security interest in these funds," Beach Community said in its Feb. 5 court filing. Beach Community stated that as the Debtor argued in its response to the U.S. Trustee's conversion motion, to the extent any additional quarterly fees are payable to the U.S. Trustee, these fees are no different from any other administrative expense which may remain unpaid in an unsuccessful Chapter 11 case. Section 1112(b)(4)(K) recognizes as grounds for dismissal the failure to pay any U.S. Trustee's quarterly fees. Beach Community sought and obtained relief from stay. The bank said in its Jan. 15, 2014 filing, "With each passing day, the amount of the debt continues to increase while the value of the collateral diminishes or, at best, remains the same. Thus Beach's secured interest is not adequately protected. With this Court's decision to dismiss this case, despite the fact that an order of dismissal has not been entered, there is simply no reason why Beach should be prohibited from pursuing its state law and state court remedies." Due to the lack of an order of dismissal being entered by the Court, Beach Community was not free to pursue its state law and state court remedies with regard to its collateral. The Court also granted the Debtor's motion for authorization to modify the requirement to pay U.S. Trustee fees as a condition of dismissal of the case. The Debtor had contended that it had paid the quarterly fees in the amount of $325, while the U.S. Trustee claimed that the fees owed for the quarter were $9,750. The Debtor was unable to locate any case law which would form a basis to dispute the U.S. Trustee's position as to the amount of the fees owed, and was unable to pay the balance of the fees owed, in the amount of $9,425, because the Debtor has no assets from which to pay the fee. The Debtor couldn't access the funds in its bank accounts which are Beach Community's cash collateral. Because the Debtor has no assets from which to pay the fees, the Debtor asked the Court to modify its prior ruling to allow dismissal of the case without the payment of the fees. The Debtor said it wasn't requesting the Court to waive the obligation of the Debtor for payment of the fees, but was only asking the Court to no longer condition dismissal of the case upon payment of the fees. Beach Community is represented by: Yancey F. Langston, Esq. MOORE, HILL & WESTMORELAND, P.A. 220 West Garden Street, 9th Floor P.O. Box 13290 Pensacola, Florida 32591-3290 Tel: (850) 434-3541 Fax: (850) 435-7899 About Shuaney Irrevocable Trust Shuaney Irrevocable Trust, in Fort Walton Beach, Florida, filed for Chapter 11 bankruptcy (Bankr. N.D. Fla. Case No. 11-31887) on Dec. 1, 2011. The Debtor scheduled $20,996,723 in assets and $19,625,890 in debts. The Law Office of Mark Freund serves as counsel to the Debtor. Judge William S. Shulman presides over the case. The U.S. Trustee for Region 21 was unable to appoint an Official Committee of Unsecured Creditors of Shuaney Irrevocable Trust. SOUND SHORE: Ford Credit Seeks Relief From Automatic Stay --------------------------------------------------------- Ford Motor Credit Company, as agent for CAB East LLC, asks the Bankruptcy Court for relief from automatic stay in the Chapter 11 cases of Sound Shore Medical Center of Westchester, et al. According to FMCC, as of Jan. 21, 2014, the Debtor was in default of its payment obligations to FMCC pursuant to the terms and conditions of the contract as: a. Net balance due: $15,220 b. Postpetition arrears: $335 for the month of December 2013, together with applicable late charges. FMCC asserts that its interest in the Debtor's property will not be adequately protected if the automatic stay is allowed to remain in effect. Martin A. Mooney, Esq., at Schiller & Knapp, LLP, represented FMCC. FMCC has requested that Court consider the matter at an April 25 hearing at 10:00 a.m. About Sound Shore Medical Center Sound Shore Medical Center of Westchester, Mount Vernon Hospital Inc., Howe Avenue Nursing Home and related entities sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 13-22840) on May 29, 2013, in White Plains, New York. The Debtors were the largest "safety net" providers for Southern Westchester County in New York. Affiliated with New York Medical College, Sound Shore is a not-for-profit 242-bed, community based- teaching hospital located in New Rochelle, New York. Mountain Vernon Hospital is a voluntary, not-for-profit 176-bed hospital located in Mount Vernon, New York. Howe Avenue Nursing Home is a 150-bed, comprehensive facility. The Debtors tapped Burton S. Weston, Esq., at Garfunkel Wild, P.C. as counsel; Alvarez & Marsal Healthcare Industry Group, LLC, as financial advisors; and GCG Inc., as claims agent. Alston & Bird LLP represents the Official Committee of Unsecured Creditors. Deloitte Financial Advisory Services LLP serves as the Committee's as financial advisor. Sound Shore disclosed assets of $159.6 million and liabilities totaling $200 million. Liabilities include a $16.2 million revolving credit and a $5.8 million term loan with Midcap Financial LLC. There is $9 million in mortgages with Sun Life Assurance Co. of Canada (US) and $11.5 million owing to the New York State Dormitory Authority. Neubert, Pepe & Monteith, P.C., represents Daniel T. McMurray, the patient care ombudsman for Sound Shore. The Debtors filed for bankruptcy to sell their assets, including their hospital and nursing home operations, to the Montefiore health system. On Aug. 8, 2013, the Bankruptcy Court entered an order, as affirmed and ratified by a Supplemental Sale Order entered on Oct. 15, 2013, approving the sale to Montefiore New Rochelle Hospital, Inc., Schaffer Extended Care Center, Inc., Montefiore Mount Vernon Hospital, Inc. and certain related affiliates. In June 2013, Montefiore added $4.75 million to its purchase offer to speed up the sale. Montefiore raised its bid to $58.75 million plus furniture and equipment as part of a request for a private sale of the hospitals. On Nov. 6, 2013 at 12:01 a.m., the closing of the Sale occurred and the sale was effective. Montefiore is represented by Togut, Segal & Segal LLP. SOUNDVIEW ELITE: Jones Day's Corinne Ball Named Ch.11 Trustee ------------------------------------------------------------- The Bankruptcy Court approved the appointment of Corinne Ball, Esq., as the Chapter 11 trustee for the estates of Soundview Elite, Ltd., et al. Ms. Ball is a senior partner at Jones Day. On Jan. 23, 2014, the Court entered a bench decision with respect to, inter alia, the Chapter 11 trustee motion. In its bench decision, the Court authorized and directed William K. Harrington, the U.S. Trustee for Region 2, to appoint a Chapter 11 trustee. To the best of the U.S. Trustee's knowledge, the Chapter 11 trustee has no connections with the Debtors, their creditors, any other parties-in-interest, their respective attorneys, the United States Trustee, and persons employed in the Office of the U.S. Trustee. Ms. Ball -- cball@jonesday.com -- led a team of Jones Day attorneys representing Chrysler LLC in connection with its successful chapter 11 reorganization, which won the Investment Dealers' Digest Deal of the Year award for 2009. She also led a team of attorneys in the successful restructuring of Dana Corp., which emerged from bankruptcy in 2008, and has orchestrated many other complex reorganizations involving companies such as Axcelis Technologies, Kaiser Aluminum, Oceans Casino Cruise Lines, Tarragon, and The Williams Communications Companies. In addition, she has counseled lenders and bondholders in the ABFS, Comdisco, Excite@Home, Exide SA, GST Communications, Iridium, Loews, NorthPoint Communications, Telergy, VARIG Airlines, and Worldcom restructurings, among others. Ms. Ball also has advised on loans, acquisitions, and workouts involving professional sports franchises, including the Charlotte Bobcats, the Detroit Redwings, the Minnesota Wild, the New Jersey Devils, and the Phoenix Coyotes. She leads the Firm's distressed M&A efforts and is the featured "Distress M&A" columnist for the New York Law Journal. She won the Turnaround Management Association's "International Turnaround Company of the Year" Award and was named "Dealmaker of the Year" by The American Lawyer and one of "The Decade's Most Influential Lawyers" by The National Law Journal. She is a director of the American College of Bankruptcy and the American Bankruptcy Institute. About Soundview Elite Six mutual funds originally created by Citco Group of Cos., including Soundview Elite Ltd., filed petitions for Chapter 11 protection on Sept. 24, 2013, in Manhattan to avoid undergoing bankruptcy liquidation in the Cayman Islands, where they are incorporated. The funds are Soundview Elite (Bankr. S.D.N.Y. Case No. 13-13098) Soundview Premium, Ltd. (Case No. 13-13099); Soundview Star Ltd. (Case No. 13-13101); Elite Designated (Case No. 13-13102); Premium Designated (Case No. 13-13103); and Star Designated (Case No. 13-13104). The petitions were signed by Floyd Saunders as corporate secretary. By order dated Oct. 16, 2013, the Court directed that the Debtors' bankruptcy cases be procedurally consolidated and jointly administered. SoundView Elite Ltd. and two similarly named funds were the target of a winding-up petitions in the Cayman Islands filed in August by Citco, which had sold its interest in the funds' manager years before. An investor, who was removed from the funds' board in June, filed a different winding-up petition in August, aimed at three funds created later to hold illiquid assets. Soundview Elite estimated assets and debts of at least $10 million. The funds said in a court filing their total cash assets of about $20 million are held in the U.S., where the funds are managed. Court papers list the funds' total assets as $52.8 million, against debt totaling $28 million. Judge Robert E. Gerber presides over the U.S. cases. Warren J. Martin, Jr., Esq., Mark J. Politan, Esq., Terri Jane Freedman, Esq., and Rachel A. Segall, Esq., at Porzio, Bromberg & Newman, PC, serve as the Debtors' counsel. CohnReznick LLP serves as financial advisor. Peter Anderson and Matthew Wright, as Joint Official Liquidators of the Debtors, are represented in the U.S. proceedings by John A. Pintarelli, Esq., James J. Beha, II, Esq., William H. Hildbold, Esq., at Morrison & Foerster LLP. The U.S. Trustee solicited for the formation of an official committee of unsecured creditors, but to date one has not been formed. SOUNDVIEW ELITE: Law Clerk Recuses From Bankruptcy Matters ---------------------------------------------------------- The Hon. Robert E. Gerber of the U.S. Bankruptcy Court for the Southern District of New York authorized law clerk Genna Ghaul to recuse herself from all matters in the Chapter 11 cases of Soundview Elite, Ltd., et al., and all related adversary proceedings. Six mutual funds originally created by Citco Group of Cos., including Soundview Elite Ltd., filed petitions for Chapter 11 protection on Sept. 24, 2013, in Manhattan to avoid undergoing bankruptcy liquidation in the Cayman Islands, where they are incorporated. The funds are Soundview Elite (Bankr. S.D.N.Y. Case No. 13-13098) Soundview Premium, Ltd. (Case No. 13-13099); Soundview Star Ltd. (Case No. 13-13101); Elite Designated (Case No. 13-13102); Premium Designated (Case No. 13-13103); and Star Designated (Case No. 13-13104). The petitions were signed by Floyd Saunders as corporate secretary. By order dated Oct. 16, 2013, the Court directed that the Debtors' bankruptcy cases be procedurally consolidated and jointly administered. SoundView Elite Ltd. and two similarly named funds were the target of a winding-up petitions in the Cayman Islands filed in August by Citco, which had sold its interest in the funds' manager years before. An investor, who was removed from the funds' board in June, filed a different winding-up petition in August, aimed at three funds created later to hold illiquid assets. Soundview Elite estimated assets and debts of at least $10 million. The funds said in a court filing their total cash assets of about $20 million are held in the U.S., where the funds are managed. Court papers list the funds' total assets as $52.8 million, against debt totaling $28 million. Judge Robert E. Gerber presides over the U.S. cases. Warren J. Martin, Jr., Esq., Mark J. Politan, Esq., Terri Jane Freedman, Esq., and Rachel A. Segall, Esq., at Porzio, Bromberg & Newman, PC, serve as the Debtors' counsel. CohnReznick LLP serves as financial advisor. Peter Anderson and Matthew Wright, as Joint Official Liquidators of the Debtors, are represented in the U.S. proceedings by John A. Pintarelli, Esq., James J. Beha, II, Esq., William H. Hildbold, Esq., at Morrison & Foerster LLP. The U.S. Trustee solicited for the formation of an official committee of unsecured creditors, but to date one has not been formed. SOUTH FLORIDA SOD: GSS Seeks Rule 2004 Examination -------------------------------------------------- Gator State Sod, Co., asks the U.S. Bankruptcy Court for the Middle District of Florida for authorization to conduct a Rule 2004 examination of: -- South Florida Sod, Inc., -- Two Hombres, LLC, of which the Debtor is an owner and member, and -- Jonathan Stidham, Esq. at Stidham & Stidham, P.A., the attorney of record for Two Hombres, LLC; and for authority to serve related discovery. GSS intends to examine the parties under Rule 2004 of the Federal Rules of Bankruptcy Procedure, through a designated agent pursuant to Federal Rule of Civil Procedure 30(b)(6) and Federal Rule of Bankruptcy Procedure 7030, in relation to a foreclosure case, the Debtor's use of real property, and matters relating to GSS's Claim. GSS relates the foreclosure case threatens GSS' interest in Two Hombres. Further, the Debtor has been utilizing the real property for its own benefit but has paid no rent to Two Hombres. According to GSS, in May 2005, the Debtor and GSS formed Two Hombres to acquire real property in Highlands County, Florida, comprised of approximately 2,000 acres. The Debtor and GSS agreed that in exchange for the contribution of GSS's lease agreement purchase option in the real property, GSS would receive a 40% interest in Two Hombres, and Two Hombres would acquire the real property after exercising the lease option. The Debtor and GSS further agreed that in exchange for the contribution of the purchase price of the real property, the Debtor would receive a 60% interest in Two Hombres. GSS thereafter assigned the lease option to the Debtor, who then assigned it to Two Hombres. Following litigation with the former owner of the real property, Gerald Darroh, Inc., regarding the lease option, Two Hombres entered into a settlement agreement with Darroh and purchased the real property for $9,950,000. In conjunction with the purchase of the real property by Two Hombres, on Feb. 27, 2007, Two Hombres, through the Debtor and McCall, executed a Promissory Note and Purchase Money Mortgage and Security Agreement in favor of Darroh and in the amount of $7,075,000. GSS recently learned that a foreclosure complaint was filed by Darroh against Two Hombres in September of 2013 in the Circuit Court in and for Highlands County, Florida. GSS was never provided notice of the Foreclosure Case by Darroh, Two Hombres or the Debtor, and GSS only learned of the Foreclosure Case after searching the Highlands County Clerk of Court website on a hunch. About South Florida Sod South Florida Sod Inc., a sod farmer, owns multiple parcels of rural real estate in Florida, Georgia, Michigan and Montana. The Debtor uses these parcels in its sod, hay, cattle, timber, stumping and hunting operations. The Company filed for Chapter 11 protection (Bankr. M.D. Fla. Case No. 13-08466) on July 9, 2013, in Orlando, Florida. The Debtor estimated at least $10 million in assets and liabilities. The company owns 13 properties in Florida and three other states. The company intends on selling a 5,777-acre property in Sarasota County, Florida, with a claimed value of $20 million or more. Secured debt totals $23.5 million, not including a $1.6 million judgment. Latham Shuker Eden & Beaudine, LLP, originally represented the Debtor as counsel. Latham Shuker was later replaced by Frank M. Wolff, Esq., at Wolff, Hill, McFarlin & Herron, P.A. Jonathan Stidham, Esq., at Stidham & Stidham, P.A., serves as special counsel to the Debtor. South Florida Sod also tapped Daniel Dempsey as its financial advisor. Wallace T. Long, Jr., CPA and Lynch, Johnson & Long, CPA, serve as accountants. Orange Hammock Ranch, LLC, the principal secured creditor, is represented by Brian A. McDowell, Esq., at Holland & Knight LLP. As reported in the TCR on Jan. 17, 2014, the Court authorized the Debtor to conduct an auction of the property at 5771 acres located in North Port, Florida, Sarasota County, on Feb. 13, 2014. The Debtor said the sale of the property would (i) satisfy secured claims held by Orange Hammock Ranch, LLC, and Wauchula State Bank against the property; and (ii) generate cash with which to fund a plan of reorganization. The auction will be conducted live from the property. South Florida Sod has sought and obtained authorization from the Bankruptcy Court to employ National Auction Group, Inc., as auctioneer and real estate broker to sell the property. The Bankruptcy Court canceled the hearing scheduled for Feb. 10, 2014, to consider confirmation of South Florida Sod's Amended Plan of Reorganization, as further amended. On Nov. 14, 2013, the Court entered its order conditionally approving the Disclosure Statement explaining the Plan. According to the Amended Disclosure Statement, the Debtor intends to sell at auction, free and clear of claims and interests, the McCall Ranch Property. The Debtor intends that the auction will take place after the confirmation of the Plan. By doing so, the Debtor believes that sufficient funds will be received to pay most, if not all, of its creditors. If the proceeds of the sale do not pay all of the claims in full, the Debtor will select another property to be sold. This will be repeated until either all of the property is sold or the debts are paid in full. The Debtor intends to sell its interest in the Little Ockmulgee Property at auction prior to confirmation. George D. Warthen Bank has agreed that to the extent there are not sufficient funds to pay its claim in full, any remaining balance will be discharged, and any claims against the guarantors released. A copy of the Amended Disclosure Statement and Amendment to Plan are available for free at: http://bankrupt.com/misc/SOUTHFLORIDASODamendedds.pdf http://bankrupt.com/misc/SOUTHFLORIDASODamendmenttoplan.pdf SPECTRASCIENCE INC: HJ Assoc. Replaces McGladrey as Accountant -------------------------------------------------------------- SpectraScience, Inc., on Feb. 3, 2014, notified McGladrey LLP that they were being dismissed as the Company's independent registered accounting firm effective immediately. The Board of Directors of the Company, upon the recommendation of its Audit Committee, approved the dismissal of MG and elected to engage HJ Associates & Consultants, LLP, to serve as the Company's independent registered accounting firm. On Feb. 6, 2014, the Company was informed that it had been accepted as a client of HJ Associates. MG's audit reports on the consolidated financial statements of the Company and its subsidiaries for the fiscal years ended Dec. 31, 2011 and 2012 did not contain any adverse opinion or disclaimer of opinion, nor were either qualified or modified as to uncertainty, audit scope, or accounting principles, except that MG's audit reports for the fiscal years ended Dec. 31, 2011 and 2012, were modified for substantial doubt as to the Company's ability to continue as a going concern. During the fiscal years ended Dec. 31, 2011 and 2012 and the subsequent interim periods through February 3, 2014, there were no disagreements with MG on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to the satisfaction of MG, would have caused MG to make reference to the subject matter of the disagreement(s) in connection with its reports. The Company also said that during the fiscal years ended December 31, 2011 and December 31, 2012 and the subsequent interim periods through February 3, 2014, there were no "reportable events" as defined in Regulation S-K, Item 304(a)(1)(v), except that: (a) in connection with the audit of the Company's financial statements for the fiscal year ended December 31, 2012, MG issued a material weakness letter relating to the Company's internal controls over financial reporting; and (b) during MG's review of the Company's financial statements for the quarter ended March 31, 2013, MG informed the Company that the material weakness in the Company's internal controls over financial reporting continued. MG has not completed a review of the Company's financial statements for any period subsequent to the quarter ended March 31, 2013. The Company has authorized MG to respond fully to the inquiries of HJ Associates with respect to their role as predecessor auditor. During the Company's two most recent fiscal years ended Dec. 31, 2012 and the subsequent interim periods through Feb. 3, 2014, the Company did not consult HJ Associates with respect to the application of accounting principles to a specific transaction, either completed or contemplated, or the type of audit opinion that might be rendered on the Company's consolidated financial statements, or any other reportable matters set forth in Items 304(a)(2)(i) and (ii) of Regulation S-K. About SpectraScience SpectraScience, Inc. (OTC QB: SCIE) is a San Diego based medical device company that designs, develops, manufactures and markets spectrophotometry systems capable of determining whether tissue is normal, pre-cancerous or cancerous without physically removing tissue from the body. The WavSTAT(TM) Optical Biopsy System uses light to optically scan tissue and provide the physician with an immediate analysis. * * * As reported in the TCR on April 25, 2013, McGladrey LLP, in Des Moines, Iowa, in its report on the Company's financial statements for the year ended Dec. 31, 2012, said the Company has suffered recurring losses from operations and its ability to continue as a going concern is dependent on the Company's ability to attract investors and generate cash through issuance of equity instruments and convertible debt. "This raises substantial doubt about the Company's ability to continue as a going concern." STANS ENERGY: Provides Update on Management Cease Trade Order ------------------------------------------------------------- Stans Energy Corp. on Feb. 7 disclosed that further to its application dated Nov. 28, 2013 for a Management Cease Trade Order (MCTO), a temporary MCTO of the Ontario Securities Commission was issued on December 9, 2013. This MCTO prohibits all trading in and all acquisitions of the securities of the Company, by certain insiders, until two days after receipt by the Commission of all the required filings as noted in the Company's Nov. 28, 2013 press release. Until the MCTO is lifted, Stans will comply with the alternative information guidelines set out in National Policy 12-203 ? Cease Trade Orders for Continuous Disclosure Defaults for issuers who have failed to comply with a specified continuous disclosure requirement within the times prescribed by applicable securities laws. The guidelines, among other things, require the Company to issue bi-weekly default status reports by way of a news release, and one will be forthcoming in the prescribed time frame. Rodney Irwin, Interim CEO and President, reports that the Company is continuing to work on evaluating potential impairment considerations of both exploration and evaluation costs on mineral properties in Kyrgyzstan and on the Company's Kashka Rare Earth Processing Facility ("KRP"). Furthermore, the review of corporate records continues to determine the date when impairment of assets may be reflected in the Company's financial statements. On Feb. 3, 2014 the Company reported that the Ontario Securities Commission extended the MCTO to provide additional time to complete this evaluation of potential impairment and the Company anticipates being in a position to file the Required Filings by Feb. 28, 2014. On Feb. 8, 2014 the Company reported that the Government of Kyrgyzstan in reaction to the Company's ongoing International Arbitration claim has formed an inter-departmental working group. A stated aim of this working group is to hold negotiations with Stans to reach an out-of-court settlement with the Company. The Arbitration Court of the Moscow Chamber of Commerce and Industry should release a detailed plan for the next scheduled hearings in the coming week. About Stans Energy Stans Energy Corp. is a resource development company focused on progressing Heavy Rare Earth (HRE) properties in areas of the Former Soviet Union. In December 2009, Stans acquired a 20-year mining license for the past-producing Kutessay II rare earth mine from the Kyrgyz Republic. On May 26, 2011 Stans completed the purchase of the Kashka Rare Earth Processing Plant (KRP) the same plant that previously refined REEs historically from Kutessay II. The KRP was the only hard rock plant to produce all rare earth elements outside of China, producing 120 different metals, alloys, and oxides. For over 30 years, Kutessay II produced 80% of the rare earth metals for the former Soviet Union. STERLING BLUFF: Coastal Bank Wants Ch. 11 Case Dismissed -------------------------------------------------------- The Coastal Bank asks the U.S. Bankruptcy Court for the Southern District of Georgia to dismiss the Chapter 11 case of Sterling Bluff Investors, LLC, for cause, including the fact that the filing was made in bad faith or, in the alternative, to grant stay relief. According to TCB's counsel, Kathleen Horne, Esq. -- khorne@bouhan.com -- at Bouhan Falligant LLP, in Savannah, Georgia, Sterling Bluff's Chapter 11 case was filed in bad faith for the purpose of hindering, delaying and frustrating TCB's legitimate efforts to pursue its remedies as set forth in the loan documents. The Debtor granted TCB a deed to secure debt and lien on 66 of the Debtor's lot and 50 memberships related to the lots. On the Petition Date, the Debtor was indebted to TCB in the approximate amount of $5,439,331, exclusive of attorney's fees, plus future accruing interest, costs, and other changes pursuant to the terms of a promissory note from the Debtor to TCB. Ms. Bouhan asserts that the current value of the Property is less than the secured debt owed by the Debtor to TCB and the Debtor does not have the ability to reorganize within any realistic period of time, much less the 90 days required by Section 362(d)(3) of the Bankruptcy Code in single asset real estate cases. About Sterling Bluff Sterling Bluff Investors, LLC, a Georgia limited liability company formed for the purpose of acquiring and owning lots in a subdivision known as the Ford Plantation, Bryan County, Georgia, and also certain club memberships in the Ford Plantation Club, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ga. Case No. 14-40200) on Feb. 3, 2014. The Debtor's counsel is Austin E. Carter, Esq., at Stone & Baxter, LLP, in Macon, Georgia. The Debtor has estimated assets ranging from $10 million to $50 million and estimated debts from $10 million to $50 million. The petition was signed by Michael Greene, manager. STERLING BLUFF: Sec. 341(a) Meeting of Creditors Set for March 3 ---------------------------------------------------------------- The U.S. Trustee for of 21 will hold a meeting of creditors of Sterling Bluff Investors, LLC, pursuant to Section 341(a) of the Bankruptcy Code on March 3, 2014, at 10:00 a.m. This is the first meeting of creditors under Section 341(a) of the Bankruptcy Code. The meeting offers creditors a one-time opportunity to examine the Debtors' representative under oath about the Debtors' financial affairs and operations that would be of interest to the general body of creditors. Attendance by the Debtor's creditors at the meeting is welcome, but not required. The meeting may be continued and concluded at a later date specified in a notice filed with the U.S. Bankruptcy Court for the Southern District of Georgia. According to court documents, proofs of claim are due by June 2, 2014, while government proofs of claim are due by Aug. 4. The Chapter 11 Plan and the disclosure statement explaining the Plan are due by June 3. About Sterling Bluff Sterling Bluff Investors, LLC, a Georgia limited liability company formed for the purpose of acquiring and owning lots in a subdivision known as the Ford Plantation, Bryan County, Georgia, and also certain club memberships in the Ford Plantation Club, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ga. Case No. 14-40200) on Feb. 3, 2014. The Debtor's counsel is Austin E. Carter, Esq., at Stone & Baxter, LLP, in Macon, Georgia. The Debtor has estimated assets ranging from $10 million to $50 million and estimated debts from $10 million to $50 million. The petition was signed by Michael Greene, manager. SWA BASELINE: Mesa, Arizona Business Campus Owner in Chapter 11 --------------------------------------------------------------- SWA Baseline, LLC, owner of a 14.53-acre business campus in Mesa, Arizona, is in Chapter 11. The company said in its schedules that the property -- located at 708 West Baseline Road, in Mesa -- is worth $16.9 million and serves as collateral to a $16.6 million debt to Alliance Bank of Arizona. Aside from the property, the company disclosed among its assets a $2.67 million claim filed in the bankruptcy of Rural/Metro Corp. (Bankr. D. Del. Case No. 13-11952). The company said potential recovery is $334,000. The company said total assets are $18.0 million and liabilities are $16.8 million. The meeting of creditors is scheduled for March 13, 2014, at 3:30 p.m. SWA Baseline, LLC, a Single Asset Real Estate as defined in 11 U.S.C. Sec. 101(51B), filed a Chapter 11 bankruptcy petition (Bankr. D. Ariz. Case No. 14-01418) on Feb. 5, 2014. Andrew J. Briefer signed the petition as designated representative. Patrick A. Clisham, Esq., at Engelman Berger PC, in Phoenix, serves as the Debtor's counsel. The Hon. Brenda Moody Whinery oversees the case. TAMERLANE VENTURES: Global Resource Seeks CCAA Termination ---------------------------------------------------------- Tamerlane Ventures Inc. disclosed the filing by Global Resource Fund of an application in the Ontario Superior Court of Justice on Jan. 24, 2014 for termination of the proceedings of Tamerlane Ventures Inc. and Pine Point Holding Corp. under the Companies' Creditors Arrangement Act and issuance of a Receivership Order with respect to Tamerlane Ventures Inc. and Pine Point Holding Corp. The Court was scheduled to hear the application Jan. 30, 2014. TC GLOBAL: Unit's Suit v. AFCM in Seattle Goes to Trial ------------------------------------------------------- In the lawsuit, TULLY'S COFFEE ASIA PACIFIC INC., Plaintiff, v. ASIA FOOD CULTURE MANAGEMENT PTE LTD., Defendant, Case No. C13- 2134 MJP (W.D. Wash.), Chief District Judge Marsha J. Pechman in Seattle denied Asia Food Culture Management PTE LTD's Motion for Summary Judgment, in which it argued that Plaintiff Tully's Coffee Asia Pacific, Inc. -- TCAP -- lost its management authority over Tully's Coffee Asia Pacific Partners, LP -- TCAPPLP -- when TC Global, TCAP's parent company, engaged in an "Indirect Transfer" to Global Baristas, giving AFCM management authority over TCAPPLP. TCAP argues it did not lose its management authority over TCAPPLP because TC Global did not make an "Indirect Transfer" to GB. The Plaintiff also argued it needed additional discovery to present the Court with a proper record. A copy of the Court's Feb. 5, 2014 Order is available at http://is.gd/b4y6FXfrom Leagle.com. About TC Global Headquartered in Seattle, Washington, TC Global, Inc., dba Tully's Coffee -- http://www.tullyscoffeeshops.com/-- is a specialty coffee retailer and wholesaler. Through company owned, licensed and franchised specialty retail stores in Washington, Oregon, California, Arizona, Idaho, Montana, Colorado, Wyoming and Utah, throughout Asia with Tully's Coffee International, and with its global alliance partner Tully's Coffee Japan, Tully's premium coffees are available at 545 branded retail locations globally. TC Global Inc. filed a Chapter 11 petition (Bankr. W.D. Wash. Case No. 12-20253-KAO) on Oct. 10, 2012. The Debtor is represented by attorneys at Bush Strout & Kornfeld LLP, in Seattle. The Debtor disclosed assets of $4.9 million and debt totaling $3.7 million, including $2.6 million in unsecured claims. The Seattle-based chain has 57 company-owned stores and 12 franchised. There are another 71 franchises in grocery stores, schools and airports. Tully's will close nine stores following bankruptcy. Tully's sold the wholesale and distribution business in 2009, generating $40 million that allowed a $5.9 million distribution to shareholders. TERENCE QUINN O'NEIL: Assets to Be Auctioned Off Feb. 25 -------------------------------------------------------- The U.S. Bankruptcy Court for the District of Connecticut approved procedures in connection with the sale of property owned by Terence Quinn O'Neil, located at 45 Baldwin Farms South, Greenwich, Connecticut. Pursuant to the terms of the Procedures Order, Douglas S. Skalka has been appointed as auctioneer of the Property and has been granted, inter alia, the power and authority to (i) accepted bids for the Property and (ii) conduct an auction of the Property. The Auctioneer was slated to make the Property available for the inspection of all interested parties on Feb. 8, 2014 at 10:00 a.m., and will hold an Auction for the sale of the Property on Feb. 25, 2014 at 2:00 p.m., at the Bankruptcy Court, 915 Lafayette Boulevard, Bridgeport, Connecticut. The hearing to authorize and approve the Sale to the successful bidder, free and clear of all liens, claims, and interests, and to approve the winning bid at the Auction will be held at the Bankruptcy Court immediately after the conclusion of the Auction. The Auctioneer may be reached at: Douglas S. Skalka NEUBERT, PEPE & MONTEITH, P.C. 195 Church Street New Haven, CT 06510 Tel: (203) 821-2000 E-mail: dskalka@npmlaw.com Terence Quinn O'Neil, aka Terry O'Neil, filed a pro se Chapter 11 bankruptcy petition (Bankr. D. Conn. Case No. 12-50192) on Feb. 2, 2012, in Bridgeport. THERMO FISHER: FTC Goes Global in Antitrust Review -------------------------------------------------- William McConnell, writing for The Deal, reported that there was a twist to the regulatory approvals Thermo Fisher Scientific Inc. secured in order to close its $13.6 billion acquisition of Life Technologies Corp., which was cleared by the Federal Trade Commission Jan. 31. According to the report, the FTC clearance was the last regulatory action needed to close the deal and was a rare instance of U.S. regulators being slower than their Chinese counterparts. Officials at China's Ministry of Commerce, or Mofcom, had approved the transaction two weeks before the U.S. on Jan. 16. But John Harkrider isn't complaining about the FTC being last to cross the finish line, the report said. The Axinn, Veltrop & Harkrider LLP partner who oversaw Thermo Fisher's global antitrust approval process credits the FTC with reaching out to other antitrust officials around the world, particularly in China and the European Union, to keep the various merger reviews in synch and to make sure officials in the various jurisdictions were in agreement on the antitrust risks posed by deal and the remedies they would seek. Antitrust approvals were also needed in Australia, Canada, Japan, New Zealand, Russia and South Korea. A tacit agreement with the FTC and the European Commission was reached early on, the report related. Thermo Fisher agreed to sell GE Healthcare three business lines, short/small interfering ribonucleic acid, or siRNA, reagents, cell culture media and cell culture sera. The product lines being spun off are used to study gene function, the cause of disease and agricultural research, and for growing cells in lab environments. The FTC determined that without the divestitures, the combined companies would have market shares of more than 50% and 90% percent of the worldwide market for aspects of the siRNA reagent businesses and at least 50% and 60% of the worldwide market for cell culture media and cell culture sera, respectively, the report further related. TIMBERLINE RESOURCES: Gets NYSE MKT Listing Non-Compliance Notice ------------------------------------------------------------------ Timberline Resources Corporation on Feb. 8 disclosed that it has received notice from the NYSE MKT LLC that the Company is not in compliance with one of the Exchange's continued listing standards as set forth in Part 10 of the NYSE MKT Company Guide. Specifically, the Company is not in compliance with Section 1003(a)(iv) of that Company Guide in that it has sustained losses which are substantial in relation to its overall operations or its existing financial resources, or its financial condition has become impaired such that it appears questionable, in the opinion of the Exchange, as to whether the Company will be able to continue operations and/or meet its obligations as they mature. In order to maintain its listing on the Exchange, the Exchange has requested that the Company submit a plan of compliance by February 20, 2014 addressing how it intends to regain compliance with Section 1003(a)(iv) of the Company Guide by March 31, 2014. Timberline's management has been working to increase its working capital and minimize expenditures by forgoing salaries, minimizing discretionary exploration expenditures and reducing other expenses. Most recently, the Company had relied on anticipated funding through purchases of shares of its common stock by RockStar Resources pursuant to the Exclusivity Fee specified in the No-Shop/Exclusivity clause of the Confidentiality Agreement entered into by and between the Company and RockStar in December 2013. However, as previously announced on Feb. 6, 2014, the Company has not received any funds from RockStar from the funding commitments for Dec. 31, 2013 and Jan. 31, 2014. The resulting cash deficiency is a major factor considered by the Exchange prior to its issuance of the notice of non-compliance. Timberline's management is pursuing a number of potential transactions to address the Company's financial requirements. The Company intends to submit a Plan in the prescribed form to the Exchange prior to the due date that management anticipates will address the concerns of the Exchange and regain compliance with the Exchange's continued listing standards. If the Plan is not accepted by the Exchange, then the Company will be subject to the Exchange's delisting procedures. The Company recognizes the need to engage in financing transactions to continue as a going concern given its current cash balance and anticipated, upcoming operating expenses. Such financing activities may include equity financings, asset sales, strategic alliances, or other arrangements, in order to execute its operating plans and exploration programs. The Company may not be able to obtain necessary financing in sufficient amounts to meet its ongoing obligations or on acceptable terms, if at all, however, Company management believes that through its best efforts it will complete a Plan and one or more transactions that will bring the Company into compliance with NYSE MKT guidelines. Unexpected regulatory delays in permitting have resulted in deferred receipts of cash flow from the Company's Butte Highlands project, however the permitting process is advancing as the Montana Department of Environmental Quality works to finalize preparation of a Final Environmental Impact Statement as the remaining milestone toward issuance of the final Hard Rock Operating Permit. About Timberline Resources Timberline Resources Corporation is exploring and developing advanced-stage gold properties in the western United States. Timberline holds a 50-percent carried interest ownership stake in the Butte Highlands Joint Venture in Montana. Timberline's exploration is primarily focused on the major gold districts of Nevada, where it is advancing its flagship Lookout Mountain Project toward a production decision while exploring a pipeline of quality earlier-stage projects at its South Eureka Property and elsewhere. Timberline's leadership has a proven track record of discovering economic mineral deposits that are developed into profitable mines. Timberline is listed on the NYSE MKT where it trades under the symbol "TLR" and on the TSX Venture Exchange where it trades under the symbol "TBR". TLC HEALTH: Court Okays Menter Rudin as Bankruptcy Counsel ---------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of New York granted TLC Health Network permission to hire Menter, Rudin & Trivelpiece, P.C., as bankruptcy attorneys. About TLC Health TLC Health Network filed a Chapter 11 petition (Bankr. W.D.N.Y. Case No. 13-13294) on Dec. 16, 2013. The petition was signed by Timothy Cooper as Chairman of the Board. The Debtor estimated assets of at least $10 million and debts of at least $1 million. Jeffrey A. Dove, Esq., at Menter, Rudin & Trivelpiece, P.C., serves as the Debtor's counsel. The case is assigned to the Hon. Carl L. Bucki. A three-member panel composed of Cannon Design, Chautauqua Opportunities, Inc., and Jamestown Rehab Services has been appointed as the official unsecured creditors committee. TRANSTAR HOLDING: ETX Acquisition No Impact on Moody's B2 Rating ---------------------------------------------------------------- Moody's Investors Services said that Transtar Holding Company's (B2 negative) announcement that it has agreed to purchase ETX Holdings, Inc. is a near-term credit negative but has no impact on the company's ratings or outlook. Transtar Holding Company is a distributor of automotive aftermarket driveline replacement parts, kits and components sold to the transmission repair and remanufacturing market. The company also supplies autobody refinishing products to professional aftermarket automotive refinishers and autobody repair shops. Net revenue for the latest twelve month period ended September 30, 2013 approached $500 million. TRINITY COAL: Court Okays Deal with Caterpillar Financial --------------------------------------------------------- Judge Tracy Wise approved a settlement of Debtors Trinity Coal Corporation, et al., with Caterpillar Financial Services Corporation (CFSC) and Essar Global Fund Limited, by which CFSC withdrew its objection to the Debtors' Reorganization Plan. Under the Settlement, CFSC will be allowed a Class 3 CAT Secured Claim for $10,675,000, to be paid over a four-year period. On the Effective Date, CFSC's Third-Party Guaranty from Essar Minerals Inc. is modified and reduced to a principal obligation of $10,000,000, but the EMI Guaranty will otherwise remain in full force and effect as modified. Caterpillar Financial Services is represented by: STOLL KEENON OGDEN PLLC Gregory D. Pavey, Esq. Adam M. Back, Esq. Jessica L. Haurylko, Esq. 300 West Vine Street, Suite 2100 Lexington, KY 40507 Essar Global Fund Limited is represented by: SHEARMAN & STERLING LLP Robert Britton, Esq. 599 Lexington Avenue New York, NY 10022 About Trinity Coal Trinity Coal Corp. is a coal mining company that owns coal deposits located in the Appalachian region of the eastern United States, specifically, in Breathitt, Floyd, Knott Magoffin, and Perry Counties in eastern Kentucky and in Boone, Fayette, Mingo, McDowell and Wyoming Counties in West Virginia. Privately held multinational conglomerate Essar Global Limited acquired Trinity Coal in 2010 for $600 million. Credit Agricole Corporate & Investment Bank, ING Capital LLC and Natixis, New York Branch filed an involuntary petition for relief under Chapter 11 against Trinity Coal Corporation and 15 affiliates (Bankr. E.D. Ky. Lead Case No. 13-50364). The three entities say they are owed a total of $104 million on account loans provided to Trinity. On Feb. 14, 2013, Austin Powder Company, Whayne Supply Company and Cecil I. Walker Machinery Co. filed an involuntary petition for relief under Chapter 11 (Bankr. E.D. Ky. Case No. 13-50335) against Frasure Creek Mining, LLC. On Feb. 19, 2013, Credit Agricole, ING Capital and Natixis joined as petitioning creditors. The Debtors consented to the entry of an order for relief in each of their respective Chapter 11 cases. Steven J. Reisman, Esq., L. P. Harrison 3rd, Esq., Jerrold L. Bregman, Esq., and Dienna Ching, Esq., at Curtis, Mallet-Prevost, Colt & Mosle LLP, in New York, N.Y.; and John W. Ames, Esq., C.R. Bowles, Jr., Esq., and Bruce Cryder, Esq., at Bingham Greenebaum Doll LLP, in Lexington, Ky., represent the Debtors as counsel. Attorneys at Foley & Lardner LLP, in Chicago, Ill., represent the Official Committee of Unsecured Creditors as counsel. Sturgill, Turner, Barker & Maloney, PLLC, in Lexington, Ky., represents the Official Committee of Unsecured Creditors as local counsel. Dixon Hughes Goodman LLP serves as tax accountants. Trinity Coal on Nov. 8, 2013 won an order confirming its Chapter 11 plan. Under the Plan, the company will exit Chapter 11 through a repurchase by Essar Group, the co-proponent of the Plan. Essar is reacquiring Trinity by paying secured lenders $56 million toward claims of some $123 million. Essar is an Indian business group controlled by billionaire brothers Shashikant and Ravikant Ruia. VIVA ALAMO: S&P Assigns Prelim. 'BB-' Rating on $500MM Sec. Loan ---------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its preliminary 'BB-' rating to Viva Alamo LLC's $500 million secured term loan B and $50 million senior secured revolving credit facility. S&P also assigned its preliminary '1' recovery rating on the term loan and revolver indicating high (90% to 100%) recovery under a default scenario. Finalization of ratings is subject to documentation review. Blackstone purchased the power generation facilities for $685 million (and $33 million in transaction expenses) on Jan. 17, 2014. With the issuance of the term loan B, about $215 million of equity will remain in the project. The portfolio consists of three combined-cycle gas turbine (CCGT) facilities (Bastrop, Frontera, and Paris) totaling 1,295 MW in the North and South regions of the Electric Reliability Council of Texas (ERCOT) market. Through February 2017, the facilities will sell 100% of their capacity under heat rate call option (HRCO) agreements to Energy America LLC, a division of Direct Energy, and will be supported by a parent guarantee from Centrica. Competitive Power Ventures Inc., an experienced manager of merchant gas-fired power plants in the U.S., is the asset manager of the project and the facilities are operated by NAES Corp., the largest global provider of third-party power plant operations. In addition, NAES has hired the plant staff that operated the facilities under Direct Energy's ownership. The outlook is stable. Relatively small projects of this type normally have a rating no higher than 'BB'. A rating upgrade, not under consideration until 2017, could occur if operational performance through the forecast period enables deleveraging of the portfolio by 20%, and there is visibility into merchant pricing that will likely to support DSCR levels of about 2.5x. Conversely, a ratings downgrade could occur if operational issues emerge that result in DSCRs declining to 1.7x. In the merchant period, S&P could lower ratings if DSCR levels are below 2x, and/or debt pay-down lags, and refinancing leverage levels are expected to be above $250 per kilowatt. WORLD IMPORTS: Can Access Bank's Cash Collateral Until Feb. 28 -------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Pennsylvania on Jan. 24 entered a sixth final stipulation and order authorizing World Imports, Ltd., et al., to use cash collateral of PNC Bank, National Association, and PNC Equipment Finance, LLC, until February 28, 2014, pursuant to a budget available for free at http://is.gd/dRLAo7 As reported in the Troubled Company Reporter on Nov. 28, 2013, as adequate protection, the banks are granted replacement liens in all of the Debtors' post-petition collateral. Any diminution in the value of the pre-petition liens in favor of the Banks caused by the Debtors' use of the Banks' cash collateral that is not compensated by post-petition collateral or through adequate protection payments will constitute a cost and expense of administration in the Bankruptcy Cases in accordance with Section 503(b)(1) of the Bankruptcy Code and will have a superpriority status pursuant to Section 507(b) of the Bankruptcy Code. A copy of the Sixth Final Stipulation and Order is available at http://is.gd/94z4gS About World Imports World Imports, Ltd., filed a Chapter 11 petition (Bankr. E.D. Pa. Case No. 13-15929) on July 3, 2013, in Philadelphia. Debtor- affiliates World Imports South, LLC (Bankr. E.D. Pa. Case No. 13-15933), 11000 LLC (Bankr. E.D. Pa. Case No. 13-15934, and World Imports Chicago, LLC (Bankr. E.D. Pa. Case No. 13-15935) filed separate petitions for Chapter 11 relief. The cases are jointly administered under Case No. 13-15929. John E. Kaskey, Esq., at Braverman Kaskey, P.C., in Philadelphia, serves as counsel to the Debtors. World Imports, Ltd., estimated assets and debts of $10 million to $50 million. World Imports South, LLC, estimated assets of $1 million to $10 million. * Bid to Speed 'Proxy Plumbing' Riles Activist Investors -------------------------------------------------------- Ronald Orol, writing for The Deal, reported that an influential business lobby group may soon press the nation's securities regulator to speed up the "proxy plumbing" process that occurs in advance of a vote on a major deal, a prospect that has sparked outrage among activist hedge fund managers who argue that the same change will hurt their ability to mobilize support for their dissident campaigns and director candidates. According to the report, at issue is the amount of time the Securities and Exchange Commission gives corporations to establish who their shareholders are in advance of an annual meeting or a special meeting, such as when investors vote on a merger or acquisition. Specifically, the agency requires that corporations start their inquiry with various banks and brokers to determine how many beneficial owners they have 20 business days -- four weeks -- prior to a "record date" that the company sets in advance of the meeting. Investors who purchase stock prior to this scheduled record date are entitled to vote those shares at the upcoming scheduled annual or special meeting and those who buy shares after that day are not. (The inquiry is made so that companies can determine how many proxy statements to provide to its shareholder base). Brian Breheny, Esq. -- brian.breheny@skadden.com -- a partner at Skadden, Arps, Slate, Meagher & Flom LLP in Washington, said that an American Bar Association committee he chairs is debating whether the time has come for the SEC to shorten the mandatory search period, the report related. Breheny, a former chief of the SEC's M&A unit, argued that recent technological advancements have made it easier to collect a list of shareholders, adding that a shorter period would speed up the process of preparing for a vote on a deal or other transaction and allow it to be completed with fewer headaches. The subcommittee may soon vote to submit a petition asking that the SEC shorten the inquiry period to five days, significantly less than the current four-week investigation period, according to people familiar with the situation, the report related. The SEC is not required to follow up on the petition, but the ABA is a major and influential pro-corporate SEC constituent (made up of numerous ex-SEC officials) and agency staffers typically pay close attention to the group's suggestions. Backers of a compressed inquiry period insist that it would be helpful in situations where shareholders are voting on transactions, because it would provide more deal certainty and less time for external issues to arise that can lower valuations or dismantle deals -- such as third-party bids, poor earnings reports, employee departures or macro-economic problems, the report further related. * For-Profit Colleges Face New Wave of State Investigations ----------------------------------------------------------- John Lauerman, writing for Bloomberg News, reported that for- profit colleges, bruised by years of investigations and rule- making, may face additional financial pressure from a new wave of state probes by attorneys general and the U.S. Consumer Financial Protection Bureau. According to the report, Education Management Co., the education chain partly owned by Goldman Sachs Group Inc.; Corinthian Colleges Inc.; ITT Educational Services Inc.; and Career Education Corp. have said that they've received demands for information from a network of at least 12 attorneys general. The Federal Trade Commission has stiffened guidelines for marketing vocational training programs, which many for-profit colleges offer. The CFPB, created in 2011 to regulate financial products, has said it's preparing to tackle student debt, which has climbed to $1.2 trillion and is pervasive among former students at for-profit colleges, the report said. Richard Cordray, head of the consumer bureau and a former Ohio attorney general, said in written testimony to a House panel on Jan. 29 that the bureau has received thousands of complaints and comments about private student loans and debt. "A coordinated approach benefits all the parties involved," Kentucky Attorney General Jack Conway, who is chairman of a group of state attorneys general investigating the education industry, said in a telephone interview, the report cited. "It helps to have federal agencies looking at this as well in order to make sure that federal education money and taxpayer dollars are being spent wisely." If they find wrongdoing, attorneys general typically file civil suits that seek monetary damages or restitution and changes in corporate behavior, said Allison Martin, a spokeswoman for Conway, the report further cited. * Fitch: SNAP Cuts in Farm Bill May Dent Food Companies ------------------------------------------------------- The sharp reduction in Supplemental Nutrition Assistance Program (SNAP) payments may dent the operations of food companies when the Agriculture Act of 2014 (farm bill) becomes law, Fitch says. The farm bill cuts SNAP spending by $8.6 billion over the next decade. According to the United States Department of Agriculture, SNAP program benefits were approximately $76 billion in 2013. The bill passed legislation this week after a tumultuous four-year back-and-forth process. President Obama is set to sign the bill into law later today. The new law's reductions in SNAP (formerly known as the Food Stamp Program) payments will further constrain spending for already cash-strapped consumers. The bifurcation of consumers continues, with higher income consumers faring well but middle to low income consumers remaining severely cost conscious and searching for food products on promotion. Packaged food companies have already reported weakness in growth for packaged foods in the center of the store where shelf stable foods are sold. An increase included in the 2009 Recovery Act raised the maximum SNAP benefit from April 2009 through Oct. 2013. That increase ended in Nov. 2013, reducing benefits for nearly every SNAP household. Families of three now receive approximately $29 less per month. Feeding America estimates that the bill will cause an estimated 850,000 low-income households to lose approximately $90 more in monthly benefits. Fitch believes spending on non-essential foods such as snacks could be hit hard and that basics such as milk will be also be affected, possibly causing a slight shift toward lower priced private label foods. We note that branded packaged food companies generally have the ability to manage their capital structures to maintain metrics appropriate for their current ratings. There may also be a slight shift toward farmers' markets, as the farm bill allows the doubling of food stamp benefits at these types of markets to encourage the consumption of more nutritious foods. Fitch does not expect any portion of the farm bill alone to materially impact ratings of US food or agribusiness companies. In addition, protein producers and industry groups have lobbied for the repeal of country of origin (COOL) labeling contained in the farm bill. The additional costs of tracking and labeling exactly where animals were born, raised and slaughtered will likely eventually be passed on to consumers in the form of higher prices. * ADGS Appoints Ho Sai Kwan David as Legal Advisor -------------------------------------------------- ADGS Advisory, Inc. on Feb. 7 disclosed that it has appointed Mr. Ho Sai Kwan David effective as of February 1, 2014 as a Legal Advisor. Mr. Ho has extensive experience in Hong Kong Bankruptcy and Insolvency Matters. Mr. Ho is a licensed and practicing solicitor in Hong Kong under Section 73 of the Legal Practitioners Ordinance (Cap. 159). Mr. Ho has more than seven years of experience in the securities industry, with particular expertise in legal and compliance, and in-house training programs at a number of securities firms including Bright Smart Securities based in Hong Kong. Mr. Ho has also been a course instructor at the Hong Kong Securities and Investment Institute, and a part-time instructor at Hong Kong Baptist University School of Continuing Education and SCOPE, City University of Hong Kong teaching HKICPA/ ACCA/ KKIAAT law papers. Mr. Ho was admitted as a solicitor of HKSAR in July 1999, was awarded an HKSI practicing certificate (securities) and an HKSI specialist certificate (securities) in July 2006, and passed a variety of Hong Kong Securities Institute licensing examinations in August 2010. He graduated in June 1980 from Wah Yah College in Hong Kong, Stafford House College, UK in June 1982, and received an LL.B. with honors from the University of Essex, UK. Mr. Ho will actively offer a legal advisory service to the Company's clients. The Company indicated that it is expanding its revenue streams. Management believes the new streams of revenue will add over 2 million Hong Kong Dollars (approximately US $250,000) for the coming year. About ADGS ADGS Advisory, Inc. is primarily engaged in providing accounting, taxation, company secretarial, general corporate and consultancy services in Hong Kong. ADGS has a strong and successful background in the Hong Kong market, most notably bankruptcy and insolvency services to a variety of customers including high growth industries in China. ADGS intends to further bolster its growth via additional acquisitions. * Large Companies With Insolvent Balance Sheet ---------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ -------- ------- ABSOLUTE SOFTWRE OU1 GR 129.8 (11.3) (10.7) ABSOLUTE SOFTWRE ALSWF US 129.8 (11.3) (10.7) ABSOLUTE SOFTWRE ABT CN 129.8 (11.3) (10.7) ACCELERON PHARMA 0A3 GR 48.4 (19.9) 6.2 ACCELERON PHARMA XLRN US 48.4 (19.9) 6.2 ADVANCED EMISSIO ADES US 106.4 (46.1) (15.3) ADVANCED EMISSIO OXQ1 GR 106.4 (46.1) (15.3) ADVENT SOFTWARE AXQ GR 454.9 (133.8) (83.4) ADVENT SOFTWARE ADVS US 454.9 (133.8) (83.4) AERIE PHARMACEUT AERI US 7.2 (22.4) (11.0) AIR CANADA-CL A ADH GR 9,481.0 (3,056.0) 105.0 AIR CANADA-CL A ADH TH 9,481.0 (3,056.0) 105.0 AIR CANADA-CL A AC/A CN 9,481.0 (3,056.0) 105.0 AIR CANADA-CL A AIDIF US 9,481.0 (3,056.0) 105.0 AIR CANADA-CL B ADH1 TH 9,481.0 (3,056.0) 105.0 AIR CANADA-CL B ADH1 GR 9,481.0 (3,056.0) 105.0 AIR CANADA-CL B AIDEF US 9,481.0 (3,056.0) 105.0 AIR CANADA-CL B AC/B CN 9,481.0 (3,056.0) 105.0 AK STEEL HLDG AKS* MM 3,766.4 (211.8) 394.9 AK STEEL HLDG AK2 GR 3,766.4 (211.8) 394.9 AK STEEL HLDG AK2 TH 3,766.4 (211.8) 394.9 AK STEEL HLDG AKS US 3,766.4 (211.8) 394.9 ALLIANCE HEALTHC AIQ US 515.6 (131.4) 61.3 AMC NETWORKS-A AMCX US 2,524.8 (611.9) 790.3 AMC NETWORKS-A 9AC GR 2,524.8 (611.9) 790.3 AMER AXLE & MFG AYA GR 3,118.5 (46.8) 387.6 AMER AXLE & MFG AXL US 3,118.5 (46.8) 387.6 AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2) AMERICAN AIRLINE A1G GR 26,780.0 (7,922.0) 143.0 AMERICAN AIRLINE A1G TH 26,780.0 (7,922.0) 143.0 AMERICAN AIRLINE AAL* MM 26,780.0 (7,922.0) 143.0 AMERICAN AIRLINE AAL US 26,780.0 (7,922.0) 143.0 AMR CORP AAMRQ US 26,780.0 (7,922.0) 143.0 AMR CORP AAMRQ* MM 26,780.0 (7,922.0) 143.0 AMR CORP ACP GR 26,780.0 (7,922.0) 143.0 AMYLIN PHARMACEU AMLN US 1,998.7 (42.4) 263.0 ANACOR PHARMACEU ANAC US 44.9 (7.3) 17.0 ANACOR PHARMACEU 44A TH 44.9 (7.3) 17.0 ANACOR PHARMACEU 44A GR 44.9 (7.3) 17.0 ANGIE'S LIST INC ANGI US 109.7 (23.0) (24.2) ANGIE'S LIST INC 8AL TH 109.7 (23.0) (24.2) ANGIE'S LIST INC 8AL GR 109.7 (23.0) (24.2) ARRAY BIOPHARMA ARRY US 152.6 (13.2) 82.3 ARRAY BIOPHARMA AR2 TH 152.6 (13.2) 82.3 ARRAY BIOPHARMA AR2 GR 152.6 (13.2) 82.3 AUTOZONE INC AZO US 7,023.4 (1,721.2) (962.6) AUTOZONE INC AZ5 GR 7,023.4 (1,721.2) (962.6) AUTOZONE INC AZ5 TH 7,023.4 (1,721.2) (962.6) BARRACUDA NETWOR CUDA US 236.2 (90.1) (66.5) BARRACUDA NETWOR 7BM GR 236.2 (90.1) (66.5) BENEFITFOCUS INC BTF GR 54.8 (43.9) (3.6) BENEFITFOCUS INC BNFT US 54.8 (43.9) (3.6) BERRY PLASTICS G BP0 GR 5,135.0 (196.0) 653.0 BERRY PLASTICS G BERY US 5,135.0 (196.0) 653.0 BOSTON PIZZA R-U BPZZF US 156.7 (108.0) (4.2) BOSTON PIZZA R-U BPF-U CN 156.7 (108.0) (4.2) BRP INC/CA-SUB V BRPIF US 1,875.1 (63.7) 116.5 BRP INC/CA-SUB V B15A GR 1,875.1 (63.7) 116.5 BRP INC/CA-SUB V DOO CN 1,875.1 (63.7) 116.5 BURLINGTON STORE BUI GR 2,594.2 (421.3) 139.7 BURLINGTON STORE BURL US 2,594.2 (421.3) 139.7 CABLEVISION SY-A CVC US 6,482.1 (5,284.1) 342.2 CABLEVISION SY-A CVY GR 6,482.1 (5,284.1) 342.2 CAESARS ENTERTAI C08 GR 26,096.4 (1,496.8) 626.7 CAESARS ENTERTAI CZR US 26,096.4 (1,496.8) 626.7 CANNAVEST CORP CANV US 10.7 (0.2) (1.3) CAPMARK FINANCIA CPMK US 20,085.1 (933.1) - CC MEDIA-A CCMO US 15,231.2 (8,370.8) 786.9 CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) CENVEO INC CVO US 1,238.5 (473.0) 143.1 CHOICE HOTELS CHH US 555.7 (484.7) 79.2 CHOICE HOTELS CZH GR 555.7 (484.7) 79.2 CIENA CORP CIE1 GR 1,802.8 (82.7) 780.7 CIENA CORP CIE1 TH 1,802.8 (82.7) 780.7 CIENA CORP CIEN US 1,802.8 (82.7) 780.7 CIENA CORP CIEN TE 1,802.8 (82.7) 780.7 CINCINNATI BELL CBB US 2,551.7 (687.2) (147.2) COROWARE INC HT9B GR 0.3 (32.1) (31.9) DIRECTV DIG1 GR 20,588.0 (6,208.0) (300.0) DIRECTV DTV US 20,588.0 (6,208.0) (300.0) DIRECTV DTV CI 20,588.0 (6,208.0) (300.0) DOMINO'S PIZZA EZV TH 468.5 (1,322.2) 76.9 DOMINO'S PIZZA EZV GR 468.5 (1,322.2) 76.9 DOMINO'S PIZZA DPZ US 468.5 (1,322.2) 76.9 DUN & BRADSTREET DB5 GR 1,849.9 (1,206.3) (128.9) DUN & BRADSTREET DB5 TH 1,849.9 (1,206.3) (128.9) DUN & BRADSTREET DNB US 1,849.9 (1,206.3) (128.9) DYAX CORP DYAX US 70.6 (38.8) 41.0 DYAX CORP DY8 GR 70.6 (38.8) 41.0 EASTMAN KODAK CO KODK US 3,815.0 (3,153.0) (785.0) EASTMAN KODAK CO KODN GR 3,815.0 (3,153.0) (785.0) EDGEN GROUP INC EDG US 883.8 (0.8) 409.2 ENTRAVISION CO-A EV9 GR 455.7 (5.6) 78.1 ENTRAVISION CO-A EVC US 455.7 (5.6) 78.1 EVERYWARE GLOBAL EVRY US 356.6 (53.9) 142.5 FAIRPOINT COMMUN FRP US 1,592.6 (406.7) 30.0 FERRELLGAS-LP FGP US 1,441.3 (134.9) (55.6) FERRELLGAS-LP FEG GR 1,441.3 (134.9) (55.6) FIFTH & PACIFIC FNP US 957.0 (220.7) (66.9) FIFTH & PACIFIC LIZ GR 957.0 (220.7) (66.9) FOREST OIL CORP FST US 1,909.3 (63.1) (148.3) FREESCALE SEMICO FSL US 3,819.0 (4,526.0) 1,239.0 FREESCALE SEMICO 1FS TH 3,819.0 (4,526.0) 1,239.0 FREESCALE SEMICO 1FS GR 3,819.0 (4,526.0) 1,239.0 GENCORP INC GY US 1,750.4 (142.6) 111.1 GENCORP INC GCY TH 1,750.4 (142.6) 111.1 GENCORP INC GCY GR 1,750.4 (142.6) 111.1 GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 GLOBAL BRASS & C 6GB GR 576.5 (37.0) 286.9 GLOBAL BRASS & C BRSS US 576.5 (37.0) 286.9 GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5 HALOZYME THERAPE HALO US 110.1 (3.5) 63.2 HALOZYME THERAPE HALOZ GR 110.1 (3.5) 63.2 HCA HOLDINGS INC 2BH GR 28,393.0 (7,044.0) 2,352.0 HCA HOLDINGS INC 2BH TH 28,393.0 (7,044.0) 2,352.0 HCA HOLDINGS INC HCA US 28,393.0 (7,044.0) 2,352.0 HD SUPPLY HOLDIN 5HD GR 6,518.0 (698.0) 1,346.0 HD SUPPLY HOLDIN HDS US 6,518.0 (698.0) 1,346.0 HOVNANIAN ENT-A HOV US 1,759.1 (432.8) 956.3 HOVNANIAN ENT-A HO3 GR 1,759.1 (432.8) 956.3 HOVNANIAN ENT-B HOVVB US 1,759.1 (432.8) 956.3 HOVNANIAN-A-WI HOV-W US 1,759.1 (432.8) 956.3 HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8) HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8) INFOR US INC LWSN US 6,515.2 (555.7) (303.6) IPCS INC IPCS US 559.2 (33.0) 72.1 ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2 JUST ENERGY GROU JE CN 1,533.5 (359.8) (281.4) JUST ENERGY GROU 1JE GR 1,533.5 (359.8) (281.4) JUST ENERGY GROU JE US 1,533.5 (359.8) (281.4) L BRANDS INC LTD GR 6,636.0 (820.0) 846.0 L BRANDS INC LB US 6,636.0 (820.0) 846.0 L BRANDS INC LTD TH 6,636.0 (820.0) 846.0 LDR HOLDING CORP LDRH US 78.7 (0.6) 9.6 LEE ENTERPRISES LEE US 989.0 (102.6) (11.9) LEE ENTERPRISES LE7 GR 989.0 (102.6) (11.9) LORILLARD INC LLV GR 3,555.0 (2,042.0) 1,297.0 LORILLARD INC LLV TH 3,555.0 (2,042.0) 1,297.0 LORILLARD INC LO US 3,555.0 (2,042.0) 1,297.0 MACROGENICS INC M55 GR 42.0 (4.0) 11.7 MACROGENICS INC MGNX US 42.0 (4.0) 11.7 MANNKIND CORP NNF1 GR 287.6 (167.7) (117.8) MANNKIND CORP NNF1 TH 287.6 (167.7) (117.8) MANNKIND CORP MNKD US 287.6 (167.7) (117.8) MARRIOTT INTL-A MAR US 6,480.0 (1,409.0) (776.0) MARRIOTT INTL-A MAQ GR 6,480.0 (1,409.0) (776.0) MDC PARTNERS-A MDCA US 1,365.7 (40.1) (211.1) MDC PARTNERS-A MD7A GR 1,365.7 (40.1) (211.1) MDC PARTNERS-A MDZ/A CN 1,365.7 (40.1) (211.1) MEDIA GENERAL MEG US 749.9 (217.2) 36.8 MERITOR INC AID1 GR 2,570.0 (822.0) 338.0 MERITOR INC MTOR US 2,570.0 (822.0) 338.0 MERRIMACK PHARMA MACK US 224.2 (16.6) 139.4 MERRIMACK PHARMA MP6 GR 224.2 (16.6) 139.4 MIRATI THERAPEUT MRTX US 18.0 (23.6) (24.5) MONEYGRAM INTERN MGI US 4,923.2 (116.3) 49.2 MORGANS HOTEL GR MHGC US 572.8 (172.9) 6.5 MORGANS HOTEL GR M1U GR 572.8 (172.9) 6.5 MPG OFFICE TRUST MPG US 1,280.0 (437.3) - NATIONAL CINEMED XWM GR 982.5 (217.5) 139.1 NATIONAL CINEMED NCMI US 982.5 (217.5) 139.1 NAVISTAR INTL NAV US 8,315.0 (3,601.0) 1,198.0 NAVISTAR INTL IHR GR 8,315.0 (3,601.0) 1,198.0 NAVISTAR INTL IHR TH 8,315.0 (3,601.0) 1,198.0 NEKTAR THERAPEUT NKTR US 383.0 (50.3) 127.0 NEKTAR THERAPEUT ITH GR 383.0 (50.3) 127.0 NORCRAFT COS INC NCFT US 265.0 (6.1) 47.7 NORCRAFT COS INC 6NC GR 265.0 (6.1) 47.7 NORTHWEST BIO NWBO US 7.6 (14.3) (9.7) NYMOX PHARMACEUT NYMX US 1.4 (6.9) (2.7) OCI PARTNERS LP OP0 GR 460.3 (98.7) 79.8 OCI PARTNERS LP OCIP US 460.3 (98.7) 79.8 OMEROS CORP 3O8 GR 12.0 (23.9) (1.6) OMEROS CORP OMER US 12.0 (23.9) (1.6) OMTHERA PHARMACE OMTH US 18.3 (8.5) (12.0) OPHTHTECH CORP O2T GR 40.2 (7.3) 34.3 OPHTHTECH CORP OPHT US 40.2 (7.3) 34.3 PALM INC PALM US 1,007.2 (6.2) 141.7 PHILIP MORRIS IN PM1CHF EU 36,795.0 (5,908.0) (2.0) PHILIP MORRIS IN PM1 TE 36,795.0 (5,908.0) (2.0) PHILIP MORRIS IN PM US 36,795.0 (5,908.0) (2.0) PHILIP MORRIS IN PM FP 36,795.0 (5,908.0) (2.0) PHILIP MORRIS IN 4I1 TH 36,795.0 (5,908.0) (2.0) PHILIP MORRIS IN PMI SW 36,795.0 (5,908.0) (2.0) PHILIP MORRIS IN PM1EUR EU 36,795.0 (5,908.0) (2.0) PHILIP MORRIS IN 4I1 GR 36,795.0 (5,908.0) (2.0) PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PLY GEM HOLDINGS PGEM US 1,088.3 (37.7) 212.1 PLY GEM HOLDINGS PG6 GR 1,088.3 (37.7) 212.1 PROTALEX INC PRTX US 1.2 (8.6) 0.6 PROTECTION ONE PONE US 562.9 (61.8) (7.6) QUALITY DISTRIBU QLTY US 465.1 (38.1) 92.3 QUINTILES TRANSN QTS GR 2,842.0 (712.0) 382.8 QUINTILES TRANSN Q US 2,842.0 (712.0) 382.8 RE/MAX HOLDINGS 2RM GR 252.0 (22.5) 39.1 RE/MAX HOLDINGS RMAX US 252.0 (22.5) 39.1 REGAL ENTERTAI-A RETA GR 2,508.3 (658.5) 54.0 REGAL ENTERTAI-A RGC US 2,508.3 (658.5) 54.0 RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4) RENTPATH INC PRM US 208.0 (91.7) 3.6 RETROPHIN INC RTRX US 21.4 (5.8) (10.3) REVLON INC-A REV US 1,259.4 (619.8) 192.4 REVLON INC-A RVL1 GR 1,259.4 (619.8) 192.4 RINGCENTRAL IN-A 3RCA GR 60.8 (25.3) (10.9) RINGCENTRAL IN-A RNG US 60.8 (25.3) (10.9) RITE AID CORP RAD US 7,138.2 (2,228.8) 1,881.2 RITE AID CORP RTA GR 7,138.2 (2,228.8) 1,881.2 RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 SALLY BEAUTY HOL S7V GR 1,950.1 (303.5) 473.2 SALLY BEAUTY HOL SBH US 1,950.1 (303.5) 473.2 SILVER SPRING NE 9SI GR 513.9 (88.9) 76.3 SILVER SPRING NE SSNI US 513.9 (88.9) 76.3 SILVER SPRING NE 9SI TH 513.9 (88.9) 76.3 SUNESIS PHARMAC SNSS US 46.6 (5.8) 11.2 SUNESIS PHARMAC RYIN GR 46.6 (5.8) 11.2 SUNGAME CORP SGMZ US 0.1 (2.2) (2.3) SUPERVALU INC SJ1 GR 4,738.0 (1,031.0) 154.0 SUPERVALU INC SVU US 4,738.0 (1,031.0) 154.0 SUPERVALU INC SJ1 TH 4,738.0 (1,031.0) 154.0 TANDEM DIABETES TNDM US 48.6 (2.8) 13.8 TANDEM DIABETES TD5 GR 48.6 (2.8) 13.8 TAUBMAN CENTERS TCO US 3,438.8 (211.5) - TAUBMAN CENTERS TU8 GR 3,438.8 (211.5) - THRESHOLD PHARMA THLD US 101.0 (17.5) 74.4 THRESHOLD PHARMA NZW1 GR 101.0 (17.5) 74.4 TOWN SPORTS INTE CLUB US 408.9 (40.4) (3.9) TOWN SPORTS INTE T3D GR 408.9 (40.4) (3.9) TRANSDIGM GROUP TDG US 6,148.9 (336.4) 998.0 TRANSDIGM GROUP T7D GR 6,148.9 (336.4) 998.0 ULTRA PETROLEUM UPL US 2,069.0 (376.8) (243.9) ULTRA PETROLEUM UPM GR 2,069.0 (376.8) (243.9) UNISYS CORP UISEUR EU 2,237.7 (1,509.9) 411.6 UNISYS CORP UIS1 SW 2,237.7 (1,509.9) 411.6 UNISYS CORP UISCHF EU 2,237.7 (1,509.9) 411.6 UNISYS CORP USY1 TH 2,237.7 (1,509.9) 411.6 UNISYS CORP USY1 GR 2,237.7 (1,509.9) 411.6 UNISYS CORP UIS US 2,237.7 (1,509.9) 411.6 VECTOR GROUP LTD VGR GR 1,121.0 (192.6) 316.7 VECTOR GROUP LTD VGR US 1,121.0 (192.6) 316.7 VENOCO INC VQ US 695.2 (258.7) (39.2) VERISIGN INC VRS GR 2,330.0 (493.8) 97.7 VERISIGN INC VRS TH 2,330.0 (493.8) 97.7 VERISIGN INC VRSN US 2,330.0 (493.8) 97.7 VERSO PAPER CORP VRS US 1,094.4 (409.5) 84.9 VINCE HOLDING CO VNCE US 467.8 (179.1) 7.7 VINCE HOLDING CO VNC GR 467.8 (179.1) 7.7 VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) VISKASE COS I VKSC US 346.7 (16.3) 106.1 WEIGHT WATCHERS WW6 GR 1,408.2 (1,509.4) (79.8) WEIGHT WATCHERS WTW US 1,408.2 (1,509.4) (79.8) WEST CORP WT2 GR 3,480.7 (782.6) 349.0 WEST CORP WSTC US 3,480.7 (782.6) 349.0 WESTMORELAND COA WME GR 939.8 (280.3) 4.1 WESTMORELAND COA WLB US 939.8 (280.3) 4.1 XERIUM TECHNOLOG XRM US 626.9 (25.4) 128.4 XERIUM TECHNOLOG TXRN GR 626.9 (25.4) 128.4 XOMA CORP XOMA US 91.0 (13.5) 58.8 XOMA CORP XOMA GR 91.0 (13.5) 58.8 XOMA CORP XOMA TH 91.0 (13.5) 58.8 ZOGENIX INC ZGNX US 54.6 (13.9) 3.1 ZOGENIX INC Z08 TH 54.6 (13.9) 3.1 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com by e-mail. 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 the nation's bankruptcy courts. The list includes links to freely downloadable of these small-dollar petitions in Acrobat PDF documents. 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. ********* 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, 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 2014. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. *** End of Transmission ***