/raid1/www/Hosts/bankrupt/TCR_Public/140419.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Saturday, April 19, 2014, Vol. 18, No. 107
Headlines
CONSTAR INT'L: February Net Loss for US Operations Up to $4.94MM
DIGERATI TECHNOLOGIES: Reports $160,871 Net Income in January
DIGERATI TECHNOLOGIES: Incurs $221,634 Net Loss in February
EWGS INTERMEDIARY: Files February Monthly Operating Report
FIBERTOWER NETWORK: Net Loss Down to $153,023 in February
FOX & HOUND: Suffers $1.70 Million Net Loss at Feb. 25
LIFE CARE: Reports $286,774 Net Income in February
METRO AFFILIATES: Ends February with $308,322 Cash
NATIONAL ENVELOPE: Net Loss Decreases to $6,446 in February
*********
CONSTAR INT'L: February Net Loss for US Operations Up to $4.94MM
----------------------------------------------------------------
Constar International Holdings, LLC, et al., on April 4, 2014,
filed their monthly operating report for February 2014.
The Debtors' consolidated statement of operations shows a net loss
of $4.94 million from their U.S. Operations, and a $547,000 net
income from their U.K. Operations.
At Feb. 28, 2014, the Debtors' U.S. Operations reported total
assets of $72.33 million, total liabilities of $233.32 million,
and a total shareholders' deficit of -($160.99 million).
Also at Feb. 28, the Debtors' U.K. Operations recorded $38.56
million in total assets, $38.95 million in total liabilities, and
a -($391,000) total shareholders' deficit.
For their U.K. Operations, the Debtors had $1.02 million cash at
the beginning of the month. They listed total receipts from
financing activities of $2.70 million and total disbursements from
operating activities of $3.74 million. Thus, at the end of the
month, the Debtors had $2,000 cash.
A copy of the monthly operating report is available at:
http://bankrupt.com/misc/Constar_495_morfeb2014.pdf
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 Constar's 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. The Committee retained Alvarez & Marsal
North America LLC as its financial advisor.
Counsel to Wells Fargo Capital Finance, LLC, the revolving loan
agent, is Andrew M. Kramer, Esq., at Otterbourg P.C.
In February 2014, the Bankruptcy Court authorized Constar to sell
certain assets to Plastipak Packaging, Inc., a global manufacturer
of rigid plastic packaging. The Court determined that Plastipak's
$102,450,000 offer for the Debtors' U.S. assets bested the offers
from Amcor Rigid Plastics USA, Inc., and Envases Universales De
Mexico S.A.P.I. De C.V. during a Feb. 6 auction.
Separately, the Court authorized Constar to sell a facility in
Havre de Grace, Maryland, to Smucker Natural Foods, Inc., for
$3 million. There was no other bidder for the Maryland facility.
The sole director of debtor Constar International U.K. Limited has
appointed Daniel Francis Butters and Nicolas Guy Edwards of
Deloitte LLP as administrators. The U.K. Administration
Proceeding follows the closing of the sale of the U.K. assets to
Sherburn Acquisition Limited. The Delaware Bankruptcy Judge
authorized the U.S. Debtors to sell the U.K. Assets to Sherburn
for GBP3,512,727, (or US$7,046,000), less the deposit in the sum
of US$1,250,000.
Secured lender Black Diamond Commercial Finance, LLC, as DIP note
agent, and Wells Fargo Capital Finance, LLC, as DIP revolving
agent and agent under the revolving loan facility, consented to
the administration of Constar U.K. and the appointment of the
Joint Administrators.
DIGERATI TECHNOLOGIES: Reports $160,871 Net Income in January
-------------------------------------------------------------
Digerati Technologies, Inc., on February 20, 2014, filed its
monthly operating report for January 2014.
The Debtor recorded a net income of $160,871 on zero profit for
the month.
At Jan. 31, the Debtor listed total $60.18 million in total
assets, $63.04 million in total liabilities, and a -($2.86
million) total shareholders' deficit.
At Jan. 1, the Debtor had $138,866 cash. It reported total
receipts of $175,000 and total disbursements of $178,774. It also
incurred professional fees of $50,000. Thus, at month end, the
Debtor had $135,091 cash.
A copy of the monthly operating report is available at the SEC at:
http://bankrupt.com/misc/DIGERATITECHNOLOGIESjan2014mor.pdf
About Digerati Technologies, Inc.
Digerati Technologies, Inc., filed a Chapter 11 petition (Bankr.
S.D. Tex. Case No. 13-33264) in Houston, on May 30, 2013.
Digerati -- http://www.digerati-inc.com-- is a diversified
holding company which owns operating subsidiaries in the oil field
services and the cloud communications industry. Digerati and its
subsidiaries maintain Texas Offices in San Antonio and Houston.
The Debtor has no independent operations apart from its
subsidiaries.
The Debtor's subsidiaries include Shift 8 Networks, a cloud
communication service, Hurley Enterprises, Inc., and Dishon
Disposal, Inc., both oil field services companies.
The Debtor disclosed $60 million in assets and $62.5 million in
liabilities as of May 29, 2013.
Bankruptcy Judge Jeff Bohm oversees the case. Deirdre Carey
Brown, Esq., Annie E. Catmull, Esq., Melissa Anne Haselden, Esq.,
Mazelle Sara Krasoff, Esq., and Edward L Rothberg, at Hoover
Slovacek, LLP, in Houston, represent the Debtor as counsel. The
Debtor tapped Gilbert A. Herrera and Herrera Partners as the
investment banker.
Earlier in the case, Rhode Holdings, LLC, sought the transfer of
venue of Digerati's Chapter 11 case to the U.S. Bankruptcy Court
for the Western District of Texas, San Antonio Division. The
case, however, stayed in Houston Bankruptcy Court.
DIGERATI TECHNOLOGIES: Incurs $221,634 Net Loss in February
-----------------------------------------------------------
Digerati Technologies, Inc., on March 21, 2014, filed its monthly
operating report for February 2014.
The Debtor incurred a net loss of $221,634 on zero revenue for the
month.
At Feb. 28, the Debtor reported total assets of $60.13 million,
total liabilities of $63.19 million, and a total shareholders'
deficit of -($3.06 million).
At Feb. 1, the Debtor had $135,091 cash. It listed zero cash
receipts and $46,566 in total cash disbursements. The Debtor
incurred professional fees of $2,500. Thus, at the end of the
month, the Debtor had $88,525 cash.
A copy of the monthly operating report is available at:
http://bankrupt.com/misc/FRESH&EASYjan-feb2014mor.pdf
About Digerati Technologies
Digerati Technologies, Inc., filed a Chapter 11 petition (Bankr.
S.D. Tex. Case No. 13-33264) in Houston, on May 30, 2013.
Digerati -- http://www.digerati-inc.com-- is a diversified
holding company which owns operating subsidiaries in the oil field
services and the cloud communications industry. Digerati and its
subsidiaries maintain Texas Offices in San Antonio and Houston.
The Debtor has no independent operations apart from its
subsidiaries.
The Debtor's subsidiaries include Shift 8 Networks, a cloud
communication service, Hurley Enterprises, Inc., and Dishon
Disposal, Inc., both oil field services companies.
The Debtor disclosed $60 million in assets and $62.5 million in
liabilities as of May 29, 2013.
Bankruptcy Judge Jeff Bohm oversees the case. Deirdre Carey
Brown, Esq., Annie E. Catmull, Esq., Melissa Anne Haselden, Esq.,
Mazelle Sara Krasoff, Esq., and Edward L Rothberg, at Hoover
Slovacek, LLP, in Houston, represent the Debtor as counsel. The
Debtor tapped Gilbert A. Herrera and Herrera Partners as the
investment banker.
Earlier in the case, Rhode Holdings, LLC, sought the transfer of
venue of Digerati's Chapter 11 case to the U.S. Bankruptcy Court
for the Western District of Texas, San Antonio Division. The
case, however, stayed in Houston Bankruptcy Court.
EWGS INTERMEDIARY: Files February Monthly Operating Report
----------------------------------------------------------
EWGS Intermediary, et al., on April 1, 2014, filed its monthly
operating report for the month of February 2014, a copy of which
is available at:
http://bankrupt.com/misc/EWGSIntermediary_340_morfeb2014.pdf
About EWGS Intermediary
EWGS Intermediary and Edwin Watts Golf Shops, which operate as an
integrated, multi-channel retailer, offering brand name golf
equipment, apparel and accessories, filed for Chapter 11
protection on Nov. 4, 2013 (Bankr. D. Del. Lead Case No. 13-
12876). They are represented by Domenic E. Pacitti, Esq., and
Michael W. Yurkewicz, Esq., at Klehr Harrison Harvey Branzburg
LLP, in Wilmington, Delaware. The Debtors tapped Bayshore
Partners LLC as their investment banker, FTI Consulting, LLC, as
their financial advisors, and Epiq Bankruptcy Solutions, LLC, as
claims and noticing agent. The Company indicates total assets
greater than $100 million on its Chapter 11 petition.
As reported in the Troubled Company Reporter on Nov. 26, 2013,
Edwin Watts Golf Shops LLC, which sells golf equipment and
clothing online and through 90 U.S. retail stores, won court
approval of procedures for a bankruptcy sale process without
having a lead bidder under contract.
PNC Bank, National Association, the DIP Agent, is represented by
Regina Stango Kelbon, Esq., at Blank Rome LLP, in Wilmington,
Delaware.
FIBERTOWER NETWORK: Net Loss Down to $153,023 in February
---------------------------------------------------------
FiberTower Network Services Corp., et al, on March 31, 2014, filed
their monthly operating report for February 2014.
The Debtors reported a net loss of $153,023 on zero revenue for
February, a decrease from the $367,709 net loss incurred the
previous month.
At Feb. 28, the Debtors recorded total assets of $25 million,
total liabilities of $324.62 million, and a total shareholders'
deficit of -($299.61 million).
At Feb. 1, the Debtors had $2.71 million cash. They listed zero
receipts and $376,367 in total disbursements. The Debtors also
spent $205,850 in professional fees. Thus, at month end, the they
posted $2.34 million cash.
A copy of the monthly operating report is available at:
http://bankrupt.com/misc/Fibertower_1085_morfeb2014.pdf
About FiberTower Corp.
FiberTower Corporation, FiberTower Network Services Corp.,
FiberTower Licensing Corp., and FiberTower Spectrum Holdings
LLC filed for Chapter 11 protection (Bankr. N.D. Tex. Case Nos.
12-44027 to 12-44031) on July 17, 2012, together with a plan
support agreement struck with prepetition secured noteholders.
FiberTower is an alternative provider of facilities-based backhaul
services, principally to wireless carriers, and a national
provider of millimeter-band spectrum services. Backhaul is the
transport of voice, video and data traffic from a wireless
carrier's mobile base station, or cell site, to its mobile
switching center or other exchange point. FiberTower provides
spectrum leasing services directly to other carriers and
enterprise clients, and also offer their spectrum services through
spectrum brokerage arrangements and through fixed wireless
equipment partners.
FiberTower's significant asset is the ownership of a national
spectrum portfolio of 24 GHz and 39 GHz wide-area spectrum
licenses, including over 740 MHz in the top 20 U.S. metropolitan
areas and, in the aggregate, roughly 1.72 billion channel pops
(calculated as the number of channels in a given area multiplied
by the population, as measured in the 2010 census, covered by
these channels). FiberTower believes the Spectrum Portfolio
represents one of the largest and most comprehensive collections
of millimeter wave spectrum in the U.S., covering areas with a
total population of over 300 million.
As of the Petition Date, FiberTower provides service to roughly
5,390 customer locations at 3,188 deployed sites in 13 markets
throughout the U.S. The fixed wireless portion of these hybrid
services is predominantly through common carrier spectrum in the
11, 18 and 23 GHz bands. FiberTower's biggest service markets are
Dallas/Fort Worth and Washington, D.C./Baltimore, with additional
markets in Atlanta, Boston, Chicago, Cleveland, Denver, Detroit,
Houston, New York/New Jersey, Pittsburgh, San Antonio/Austin/Waco
and Tampa.
As of June 30, 2012, FiberTower's books and records reflected
total combined assets, at book value, of roughly $188 million and
total combined liabilities of roughly $211 million. As of the
Petition Date, FiberTower had unrestricted cash of roughly $23
million. For the six months ending June 30, 2012, FiberTower had
total revenue of roughly $33 million. With the help of FTI
Consulting Inc., FiberTower's preliminary valuation work shows
that the Company's enterprise value is materially less than $132
million -- i.e., the approximate principal amount of the 9.00%
Senior Secured Notes due 2016 outstanding as of the Petition Date.
The preliminary valuation work is based upon the assumption that
FiberTower's spectrum licenses will not be terminated. Fibertower
Spectrum disclosed $106,630,000 in assets and $175,501,975 in
liabilities as of the Chapter 11 filing.
Judge D. Michael Lynn oversees the Chapter 11 case. Lawyers at
Andrews Kurth LLP serve as the Debtors' lead counsel. Lawyers at
Hogan Lovells and Willkie Farr and Gallagher LLP serve as special
FCC counsel. FTI Consulting serve as financial advisor. BMC
Group Inc. serve as claims and noticing agent. The petitions were
signed by Kurt J. Van Wagenen, president.
Wells Fargo Bank, National Association -- as indenture trustee and
collateral agent to the holders of 9.00% Senior Secured Notes due
2016 owed roughly $132 million as of the Petition Date -- is
represented by Eric A. Schaffer, Esq., at Reed Smith LLP. An Ad
Hoc Committee of Holders of the 9% Secured Notes Due 2016 is
represented by Kris M. Hansen, Esq., and Sayan Bhattacharyya,
Esq., at Stroock & Stroock & Lavan LLP. Wells Fargo and the Ad
Hoc Committee also have hired Stephen M. Pezanosky, Esq., and Mark
Elmore, Esq., at Haynes and Boone, LLP, as local counsel.
U.S. Bank, National Association -- in its capacity as successor
indenture trustee and collateral agent to holders of the 9.00%
Convertible Senior Secured Notes due 2012, owed $37 million as of
the Petition Date -- is represented by Michael B. Fisco, Esq., at
Faegre Baker Daniels LLP, as counsel and J. Mark Chevallier, Esq.,
at McGuire Craddock & Strother PC as local counsel.
William T. Neary, the U.S. Trustee for Region 6 appointed five
members to the Official Committee of Unsecured Creditors in the
Debtors' cases. The Committee is represented by Otterbourg,
Steindler, Houston & Rosen, P.C., and Cole, Schotz, Meisel, Forman
& Leonard, P.A. Goldin Associates, LLC serves as its financial
advisors.
On March 15, 2013, the Court entered an order authorizing the
Debtors to sell assets that are primarily utilized by the Debtors
to provide wireless backhaul services in the State of Ohio to
Cellco Partnership (dba Verizon Wireless) free and clear for $1.5
million.
In May 2013, FiberTower sought and obtained Court authority to
sell their telecommunications equipment and employ American
Communications, LLC, as telecommunications equipment reseller.
According to the Debtors, the telecommunications equipment, which
was a part of their backhaul business, is no longer necessary in
the conduct of their business. They, however, believe that the
equipment may have resale value that would benefit their estates.
On Jan. 27, 2014, FiberTower, et al., obtained confirmation of
their Fourth Amended Joint Chapter 11 Plan.
FOX & HOUND: Suffers $1.70 Million Net Loss at Feb. 25
------------------------------------------------------
F&H Acquisition Corp., et al., on March 21, 2014, filed their
monthly operating report for the period from January 29 to
February 25, 2014.
The Debtors suffered a $1.70 million net loss on $17.07 million
net sales for the reporting period, a slight increase from the
$1.47 million net loss reported in January 28.
The Debtors listed total assets of $175.90 million, total
liabilities of $172.75 million, and a total shareholders' equity
if $3.14 million.
The Debtors had $6.99 million cash at the beginning of the period.
They reported total receipts of $20.43 million and total
disbursements of $19.17 million. They also incurred professional
fees of $43,253. Thus, at the end of the period, the Debtors had
$8.26 million cash.
A copy of the monthly operating report is available at:
http://bankrupt.com/misc/F_HAcquisition_513_morfeb2014.pdf
About F & H Acquisition Corp.
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.
F & H Acquisition Corp., disclosed $122,115,200 in assets and
$122,579,631 in liabilities as of the Chapter 11 filing.
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 Adam Friedman, Esq., at Olshan Frome
Wolosky LLP, in New York; and Robert S. Brady, Esq., Young Conaway
Stargatt & Taylor, LLP, in Wilmington, Delaware, as counsel;
Imperial Capital LLC as financial advisor; and Epiq Bankruptcy
Solutions as claims and noticing agent.
The U.S. Trustee has appointed seven members to an official
committee of unsecured creditors. The Official Committee of
Unsecured Creditors is represented by Bradford J. Sandler, Esq.,
at Pachulski Stang Ziehl & Jones, LLP, in Wilmington, Delaware;
and Jeffrey N. Pomerantz, Esq., at Pachulski Stang Ziehl & Jones,
LLP, in Los Angeles, California.
LIFE CARE: Reports $286,774 Net Income in February
--------------------------------------------------
Life Care St. Johns, Inc., dba Glenmoor, on April 4, 2014, filed
its monthly operating report for February 2014.
The Debtor reported a net income of $286,774 on total revenue of
$858,629, an increase from the $665,664 net loss recorded in
January.
At Feb. 28, the Debtors recorded total assets of $62.03 million,
total liabilities of $117.33 million, and a total shareholders'
deficit of -($55.30 million).
The Debtor had $1.72 million cash at the beginning of the month.
It listed $97,845 in total cash inflow and $220,439 in total cash
outflow. At the end of the month, the Debtor had $1.59 million
cash.
A copy of the monthly operating report is available at:
http://bankrupt.com/misc/LIFECAREfeb2014mor.pdf
About Life Care St. Johns, Inc.
Life Care St. Johns, Inc., filed a Chapter 11 petition (Bankr.
M.D. Fla. Case No. 13-04158) on July 3, 2013. The Debtor is the
owner and operator of a continuing care retirement community known
as Glenmoor consisting of 144 independent living units located on
a 40-acre site in St. Johns County, Florida.
Judge Jerry A. Funk presides over the case. Richard R. Thames,
Esq., and Eric N. McKay, Esq., at Stutsman Thames & Markey, P.A.,
serves as the Debtor's counsel. American Legal Claim Services,
LLC, serves as claims and noticing agent. The Debtor hired
Navigant Capital Advisors, LLC, as financial advisors. Following
Neil F. Luria's transfer to SOLIC Capital Advisors LLC, the Debtor
replaced Navigant with SOLIC.
The Committee of Creditors Holding Unsecured Claims appointed in
the bankruptcy case of Life Care St. Johns, Inc., is represented
by Akerman Senterfitt's David E. Otero, Esq., and Christian P.
George, Esq., in Jacksonville, Florida.
Bruce Jones signed the petition as CEO. The Debtor disclosed
$36,308,406 in assets and $117,305,625 in liabilities as of the
Chapter 11 filing.
METRO AFFILIATES: Ends February with $308,322 Cash
--------------------------------------------------
Metro Affiliates, Inc., et al, on March 26, 2014, filed their
monthly operating report for the month of February 2014.
The Debtors incurred a $3.57 million net loss on $1.82 million net
revenue for February, as compared to the $3.42 million net loss
incurred the previous month.
At Feb. 28, the Debtors reported total assets of $104.92 million,
total liabilities of $240.59 million, and a total shareholders'
deficit of -($135.67 million).
The Debtors had $535,052 cash at the beginning of the month. They
recorded $15.43 million in total receipts and $15.66 million in
total disbursements. They spent $392,960 in professional fees.
At the end of the month, the Debtors had $308,322 cash.
A copy of the monthly operating report is available at:
http://bankrupt.com/misc/MetroAffiliates_1021_morfeb2014.pdf
About Metro Affiliates
Staten Island, New York-based Metro Affiliates, Inc., and its
subsidiaries sought protection under Chapter 11 of the Bankruptcy
Code on Nov. 4, 2013 (Bankr. S.D.N.Y. Case No. 13-13591). The
case is assigned to Judge Sean Lane.
Lisa G. Beckerman, Esq., and Rachel Ehrlich Albanese, Esq., at
Akin Gump Strauss Hauer & Feld LLP, in New York; and Scott L.
Alberino, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
Washington, D.C., represent the Debtors. Silverman Shin & Byrne
PLLC serves as special counsel. Rothschild Inc. serves as the
Debtors' investment banker, while Kurtzman Carson Consultants LLC
serves as their claims and noticing agent.
Wells Fargo Bank, National Association, as agent for a consortium
of DIP lenders, is represented by Jonathan N. Helfat, Esq., at
Otterbourg, Steindler, Houston & Rosen, P.C., in New York.
The Bank of New York Mellon as indenture trustee and collateral
agent for prepetition noteholders, is represented by James
Gadsden, Esq., at Carter, Ledyard & Milburn LLP, in New York.
Certain Noteholders are represented by Kristopher M. Hansen, Esq.,
at Stroock & Stroock & Lavan LLP, in New York.
The U.S. has appointed a three-member official committee of
unsecured creditors represented by Farrell Fritz, P.C.
PricewaterhouseCoopers LLP serves as the Committee's financial
advisors.
This is Metro Affiliates' third trip to Chapter 11. The Company,
together with its subsidiaries, previously sought protection under
Chapter 11 of the Bankruptcy Code on Aug. 16, 2002 (In re Metro
Affiliates, Inc., Case No. 02-42560 (PCB), Bankr. S.D.N.Y.). A
plan in the second Chapter 11 case was confirmed in September
2003. The first bankruptcy was in 1994.
NATIONAL ENVELOPE: Net Loss Decreases to $6,446 in February
-----------------------------------------------------------
NE Opco, Inc., dba National Envelope, and its debtor-affiliates,
on April 2, 2014, filed their monthly operating report for the
month of February 2014.
The Debtors' income statement showed a net loss of $6,446 on zero
sales for the month, a substantial decrease from the $102,988 net
loss in January.
At Feb. 28, the Debtors listed total assets of $2.04 million,
total liabilities of $136.36 million, and a total shareholders'
deficit of -($134.32 million).
The Debtors had $672,402 at the beginning of the month. They
posted $69,241 in net cash used in operating activities. At month
end, the Debtors had $748,090 cash.
A copy of the monthly operating report is available at:
http://bankrupt.com/misc/NEOpco_613_morfeb2014.pdf
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.
*********
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interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
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Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
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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
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