/raid1/www/Hosts/bankrupt/TCR_Public/140507.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, May 7, 2014, Vol. 18, No. 125
Headlines
ADELPHIA COMMS: Judge Rules for FPL in Clawback Suit
ADVANCED MICRO: Files Form 10-Q, Incurs $20MM Net Loss in Q1
AEOLUS PHARMACEUTICALS: Amends Fiscal 2013 Annual Report
ALAMBRES PROPERTIES: Voluntary Chapter 11 Case Summary
ALCO CORP: Seeks Dismissal of Chapter 11 Case
ALION SCIENCE: Amends Refinancing Support Agreement
ALLY FINANCIAL: Files Form 10-Q, Posts $227MM Net Income in Q1
AMERICAN AXLE: Posts $33.6 Million Net Income in First Quarter
AMERICAN COMMERCE: To Issue 121.5 Million Shares Under Plan
ANIL INC: Voluntary Chapter 11 Case Summary
ARROW ALUMINUM: Had Case Dismissed and Closed
AUXILIUM PHARMACEUTICALS: Moody's Cuts Corp. Family Rating to B3
B/E AEROSPACE: S&P Alters Outlook to Developing & Affirms BB+ CCR
BAHIA DEL SOL HOTEL: Case Summary & 10 Top Unsecured Creditors
BEAZER HOMES: Incurs $7.9 Million Net Loss in 2nd Quarter
BEHRINGER HARVARD: Had $16.2MM Assets in Liquidation at Dec. 31
BERRY PLASTICS: Moody's Rates New 2nd Senior Secured Notes 'Caa1'
BERRY PLASTICS: S&P Raises CCR to 'B+' & Rates $500MM Notes 'B-'
BG MEDICINE: Incurs $15.8 Million Net Loss in 2013
BROADWAY FINANCIAL: Incurs $41,000 Net Loss in Fourth Quarter
BROWN DOG FARM: Case Summary & 5 Largest Unsecured Creditors
BUILDERS FIRSTSOURCE: Reports $3.4-Mil. Net Loss in 1st Quarter
CAESARS ENTERTAINMENT: Tries to Strengthen Unit Through New Debt
C&K MARKET: Doesn't Owe Lender Breakup Fee Over Financing
CELL THERAPEUTICS: Had $39.6MM Financial Standing at Feb. 28
CLAIRE'S STORES: Amends Credit Agreement with Credit Suisse
CLAREMONT PLAZA: Case Summary & Unsecured Creditor
CNO FINANCIAL: Fitch Raises Issuer Default Rating to 'BB+'
CROWN MEDIA: Posts $12 Million Net Income in First Quarter
DORAL FINANCIAL: Fitch Cuts Issuer Default Rating to 'C'
DOUG RICH: Wins Court Approval to Abandon Real Property
DUNE ENERGY: Incurs $2.5 Million Net Loss in First Quarter
EDGENET INC: Bid to Disband Noteholders' Committee Denied
EGPI FIRECREEK: Four Directors Elected to Board
ELITE PHARMACEUTICALS: Amends 108MM Shares Resale Prospectus
ELBIT IMAGING: Talks on Possible Purchase of Gamida Terminated
EMPIRE RESORTS: Expects $13.36MM Proceeds From Rights Offering
ENERGY FUTURE: Webinar on Ch. 11 Filing Scheduled for May 8
ENERGY FUTURE: June 5 Final Hearing on First Day Requests
ENERGY FUTURE: Junior Debtholders Take Issue on Valuation
ENERGY FUTURE: Amends 2013 Annual Report to Add Exhibits
ENGLOBAL CORP: Awarded Patents and New Projects
EQUIPMENT ACQUISITION: Administrator's Suits Stay in Bankr. Court
EURAMAX HOLDINGS: Scott Vansant Appointed North America President
FEDERACION DE MAESTROS: Motion to Alter Order Denied
FIAT CHRYSLER: Sketches Bigger Roles for Premium Car Brands
FIRST PHYSICIANS: Adrian Reeder Appointed EVP and CFO
FNBH BANCORP: Obtains $1.6 Million From Rights Offering
FOUNDATION HEALTHCARE: Incurs $3.5 Million Net Loss in 4th Qtr.
FRESH & EASY: Disclosure Statement Hearing Set for May 30
FUSION TELECOMMUNICATIONS: Registers 420.6MM Shares for Resale
GENCO SHIPPING: Limited General Bar Date Set for May 22
GENERAL MOTORS: Summary Judgment v. Sherif Rafik Kodsy Affirmed
GENERAL MOTORS: Asks Halt to Suits Relating to Bankruptcy
GENERAL MOTORS: Offers New Discount to Owners of Recalled Cars
GIBSON BRANDS: Moody's Rates $150MM 2nd Lien Senior Notes 'B3'
GREEN FIELD: Examiner's Report Critical of Founder
GREENSHIFT CORP: Retires $3.7 Million Convertible Debentures
GUIDED THERAPEUTICS: Incurs $4.2 Million Net Loss in 4th Quarter
GUITAR CENTER: Suspending Filing of Reports with SEC
HOSPITALITY STAFFING: Wants Plan Filing Extended to June 27
HOLYOKE GERIATRIC: Evidentiary Hearing on May 22 and 23
INTERNATIONAL COMMERCIAL: Posts $1.6 Million Net Income in 2013
INTERNATIONAL TEXTILE: Gorga Retires, Kunberger Appointed as CEO
LIGHTSQUARED INC: Lawyer Discredits Ergen Testimony
LIONS GATE: S&P Revises Outlook to Positive & Affirms 'B+' CCR
LPL HOLDINGS: Moody's Affirms Ba2 Corp. Family & Sr. Sec. Rating
LYFE COMMUNICATIONS: Delays 2013 Form 10-K
MAGNOLIA SCIENCE: S&P Assigns 'BB' Rating to $6.06MM Revenue Bonds
MASON COPPELL: Sells Estrella, et al., Assets for $16.1 Million
MAUI LAND: Incurs $909,000 Net Loss in First Quarter
MERCANTILE BANCORP: June 26 Hearing on Confirmation of Plan
MERRIMACK PHARMACEUTICALS: Incurs $27.8 Million Net Loss in Q1
METRO AFFILIATES: To Release Funds From Escrow to Pay Claims
MID-SOUTH BUSINESS: Case Summary & Largest Unsecured Creditors
MINUTEMAN SPILL RESPONSE: Trucking Firm Files Bankruptcy
MOLA INC: Voluntary Chapter 11 Case Summary
MOTORCAR PARTS: Wellington Stake at 2.9% as of Dec. 31
MOTORCAR PARTS: Nantahala Capital Stake Down to 1.9% as of Dec. 31
MOTORCAR PARTS: Raging Capital No Longer Owns Shares of Dec. 31
MOUNTAIN PROVINCE: Reports C$26.6 Million 2013 Net Loss
MT. LAUREL LODGING: Can Access Cash Collateral Until Aug. 31
MT. LAUREL LODGING: NRB Has Until May 16 to Appeal Valuation
N-VIRO INTERNATIONAL: Assigns Purchase Contract to BGH
NATCHEZ REGIONAL: UMB Financing Extended Until July 15
NATCHEZ REGIONAL: Patient Care Ombudsman Not Necessary
NELMAR PROPERTIES: Case Summary & 2 Largest Unsecured Creditors
NEW TRIDENT: Moody's Lowers Corp. Family Rating to 'B3'
NII HOLDINGS: Frontier Capital Stake at 9.7% as of Dec. 31
NII HOLDINGS: FMR LLC Reports 14.2% Equity Stake
NII HOLDINGS: Discovery Capital Reports 0% Equity Stake
ORCKIT COMMUNICATIONS: Postpones Creditors' Meeting Pending Talks
OVERSEAS SHIPHOLDING: PJSC Okayed as Equity Panel's Fin'l Advisor
PACHECO PLAZA: Ch.11 Case Dismissed, Slapped With 2-Year Ban
PARADE PLACE: Samuel's Temple Church's Bid to Reargue Denied
PATRIOT ELECTRIC: M&T Dispute Goes Straight to Md. Appeals Court
PICCADILLY RESTAURANTS: Plan Declared Effective on April 17
PORTER BANCORP: Reports $976,000 Net Loss in First Quarter
PURADYN FILTER: Reports $1.3 Million 2013 Net Loss
PWK TIMBERLAND: Remaining Withdrawing Members Support Dean Pact
RAYONIER ADVANCED: S&P Assigns BB+ CCR & Rates $500MM Notes BB+
RELIANCE INTERMEDIATE: Moody's Reviews 'B2' Rating for Downgrade
RESIDENTIAL CAPITAL: Dist. Court Tosses "Franklin" Pro Se Appeal
RIVERWALK JACKSONVILLE: May 14 Hearing in Chapter 11 Case
ROCKET SOFTWARE: Dividend Cancellation No Impact on Moody's CFR
SBARRO LLC: Reaches Deal with Creditors, Amends Ch. 11 Plan
SE SHIRES: Bids for Trumpets Maker Due May 19
SEANERGY MARITIME: Reports $7.5-Mil. Net Income in Fourth Quarter
SEARS HOLDINGS: Amends 2014 AIP and 2014 LTIP Plans
SEQUENOM INC: Chief Medical Officer to Retire
SEQUENOM INC: Incurs $15.7 Million Net Loss in First Quarter
SERENITY CARE: PNC Bank Wins Default Judgment
STACY'S INC: Has Agreement to Settle Sun Gro's $72,321 Claim
STEREOTAXIS INC: Files Form 10-K, Incurs $68.7 Million 2013 Loss
SYMPHONY TELECA: S&P Assigns 'B' CCR & Rates $125MM Debt 'BB-'
TOMNICK REALTY: Voluntary Chapter 11 Case Summary
TOYS R US: 2014 Could be Critical for Toy Seller's History
TUOMEY HEALTHCARE: Facing Bankruptcy Amid $240MM Judgment
US SHIPPING: Moody's Raises Corporate Family Rating to 'B3'
WARNER MUSIC: Elects Three New Directors
WEST CORP: Reports $46.3 Million Net Income in First Quarter
WESTMORELAND COAL: Acquires Sherritt Coal Operations
WHEATLAND MARKETPLACE: May Sell Real Properties for $10.1 Million
WHITE OAKS CHARLES PLACE: Case Summary & 2 Top Unsec. Creditors
WITHOUT WALLS INT'L CHURCH: Heads for Auction
YRC WORLDWIDE: Reports $88.3 Million Net Loss in First Quarter
* Fitch Says North Las Vegas Faces Same Factors That Led to Ch.11
* April Bankruptcy Filings in Rochester, NY Drop 19%
* KPMG Buys Southfield-Based Turnaround Consultancy BBK
*********
ADELPHIA COMMS: Judge Rules for FPL in Clawback Suit
----------------------------------------------------
Patrick Fitzgerald, writing for The Wall Street Journal, reported
that a federal bankruptcy judge said creditors of Adelphia
Communications Corp. can't claw back $150 million the failed cable
television company paid to a Florida utility in a 1999 stock
buyback.
According to the report, the decision in the decade-old suit is a
win for the former FPL Group Inc., now the principal subsidiary of
NextEra Energy Inc., and Adelphia's former partner in a cable
television venture.
Judge Robert E. Gerber of the U.S. Bankruptcy Court in New York,
the judge who oversaw Adelphia's Chapter 11 case, said a trust
created to pursue lawsuits to benefit unhappy creditors following
Adelphia's contentious bankruptcy failed to show that the buyback
left Adelphia insolvent, the report related.
"At the time of the transaction, Adelphia was not yet insolvent,
left with inadequate capital, or unable to pay its debts as they
matured," said Judge Gerber in a 79-page ruling, the report
further related. "Accordingly, judgment should be entered in
favor of the FPL Defendants."
The Adelphia trust sued FPL in 2004 over the stock buyback,
claiming the deal was a fraudulent transfer that left Adelphia
insolvent, the report added.
About Adelphia Communications
Based in Coudersport, Pennsylvania, Adelphia Communications
Corporation was once the fifth-biggest cable company. Adelphia
served customers in 30 states and Puerto Rico, and offered analog
and digital video services, Internet access and other advanced
services over its broadband networks.
Adelphia collapsed in 2002 after disclosing that founder John
Rigas and his family owed $2.3 billion in off-balance-sheet debt
on bank loans taken jointly with the company. Mr. Rigas was
sentenced to 12 years in prison, while son Timothy 15 years.
Adelphia Communications and its more than 200 affiliates filed for
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 02-41729) on
June 25, 2002. Willkie Farr & Gallagher represented the Debtors
in their restructuring effort. PricewaterhouseCoopers served as
the Debtors' financial advisor. Kasowitz, Benson, Torres &
Friedman LLP and Klee, Tuchin, Bogdanoff & Stern LLP represented
the Official Committee of Unsecured Creditors.
Adelphia Cablevision Associates of Radnor, L.P., and 20 of its
affiliates, collectively known as Rigas-Managed Entities, were
entities that were previously held or controlled by members of the
Rigas family. In March 2006, the rights and titles to these
entities were transferred to certain subsidiaries of Adelphia
Cablevision LLC. The RME Debtors filed for Chapter 11 protection
(Bankr. S.D.N.Y. Case Nos. 06-10622 through 06-10642) on March 31,
2006. Their cases were jointly administered under Adelphia
Communications and its debtor-affiliates' Chapter 11 cases.
The Bankruptcy Court confirmed the Debtors' Joint Chapter 11 Plan
of Reorganization on Jan. 5, 2007. That plan became effective on
Feb. 13, 2007.
The Adelphia Recovery Trust, a Delaware Statutory Trust, was
formed pursuant to the Plan. The Trust holds certain litigation
claims transferred pursuant to the Plan against various third
parties and exists to prosecute the causes of action transferred
to it for the benefit of holders of Trust interests. Lawyers at
Kasowitz, Benson, Torres & Friedman, LLP (NYC), represent the
Adelphia Recovery Trust.
ADVANCED MICRO: Files Form 10-Q, Incurs $20MM Net Loss in Q1
------------------------------------------------------------
Advanced Micro Devices, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $20 million on $1.39 billion of net revenue for the
quarter ended March 29, 2014, as compared with a net loss of $146
million on $1.08 billion of net revenue for the quarter ended
March 30, 2013.
As of March 29, 2014, the Company had $4.10 billion in total
assets, $3.59 billion in total liabilities and $511 million in
total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/R2BNr8
About Advanced Micro Devices
Sunnyvale, California-based Advanced Micro Devices, Inc., is a
global semiconductor company. The Company's products include x86
microprocessors and graphics.
Advanced Micro incurred a net loss of $83 million for the year
ended Dec. 28, 2013, as compared with a net loss of $1.18 billion
for the year ended Dec. 29, 2012.
* * *
In August 2013, Standard & Poor's Ratings Services revised its
outlook on Advanced Micro to negative from stable. At the same
time, S&P affirmed its 'B' corporate credit and senior unsecured
debt ratings on AMD.
As reported by the TCR on Feb. 4, 2014, Fitch Ratings has affirmed
the 'CCC' long-term Issuer Default Rating (IDR) for Advanced Micro
Devices Inc. The rating reflects Fitch's expectations for
negative near-term free cash flow (FCF) and limited top-line
visibility, despite solid product momentum heading into 2014.
In the Feb. 4, 2013, edition of the TCR, Moody's Investors Service
lowered Advanced Micro Devices' corporate family rating to B2 from
B1. The downgrade of the corporate family rating to B2 reflects
AMD's prospects for weaker operating performance and liquidity
profile over the next year as the company commences on a multi-
quarter strategic reorientation of its business in the face of a
challenging macro environment and a weak PC market.
AEOLUS PHARMACEUTICALS: Amends Fiscal 2013 Annual Report
--------------------------------------------------------
Aeolus Pharmaceuticals, Inc., filed an amendment No. 1 on Form
10-K/A to amend the Company's annual report on Form 10-K for the
fiscal year ended Sept. 30, 2013, as filed with the Securities and
Exchange Commission on Dec. 20, 2013. The purpose of the Form
10-K/A is to replace Part III, Item 10 through Item 14, previously
intended to be incorporated by reference to the Company's
definitive information statement filed pursuant to Regulation 14C.
The Company is including with the Form 10-K/A certain new
certifications by its principal executive officer and principal
financial officer. Accordingly, Item 15 of Part IV has also been
amended to reflect the filing of these new certifications. The
Company has not modified or updated disclosures presented in the
Original Form 10-K to reflect events or developments that have
occurred after the date of the Original Form 10-K. A copy of the
Form 10-K/A is available for free at http://is.gd/he7ae7
About Aeolus Pharmaceuticals
Mission Viejo, California-based Aeolus Pharmaceuticals, Inc., is a
Southern California-based biopharmaceutical company leveraging
significant government investment to develop a platform of novel
compounds in oncology and biodefense. The platform consists of
over 200 compounds licensed from Duke University and National
Jewish Health.
The Company's lead compound, AEOL 10150, is being developed as a
medical countermeasure ("MCM") against the pulmonary sub-syndrome
of acute radiation syndrome ("Pulmonary Acute Radiation Syndrome"
or "Lung-ARS") as well as the gastrointestinal sub-syndrome of
acute radiation syndrome ("GI-ARS"). Both syndromes are caused by
acute exposure to high levels of radiation due to a radiological
or nuclear event. It is also being developed for use as a MCM for
exposure to chemical vesicants such as chlorine gas, sulfur
mustard gas and nerve agents.
Aeolus Pharmaceuticals reported a net loss of $3.20 million on
$3.92 million of contract revenue for the fiscal year ended
Sept. 30, 2013, as compared with net income of $1.69 million on
$7.29 million of contract revenue during the prior fiscal year.
As of Dec. 31, 2013, the Company had $2.75 million in total
assets, $2.48 million in total liabilities and $278,000 in total
stockholders' equity.
Grant Thornton LLP, in San Diego, California, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Sept. 30, 2013. The independent auditors noted
that the Company has incurred recurring losses and negative cash
flows from operations, and management believes the Company does
not currently possess sufficient working capital to fund its
operations through fiscal 2014. These conditions, along with
other matters...raise substantial doubt about the Company's
ability to continue as a going concern.
ALAMBRES PROPERTIES: Voluntary Chapter 11 Case Summary
------------------------------------------------------
Debtor: Alambres Properties Ltd.
12 Maple Leaf Rd
Monsey, NY 10952
Case No.: 14-22624
Chapter 11 Petition Date: May 6, 2014
Court: United States Bankruptcy Court
Southern District of New York (White Plains)
Judge: Hon. Robert D. Drain
Debtor's Counsel: Mark A. Frankel, Esq.
BACKENROTH FRANKEL & KRINSKY, LLP
800 Third Avenue, 11th Floor
New York, NY 10022
Tel: (212) 593-1100
Fax: (212) 644-0544
Email: mfrankel@bfklaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Baruch Tabak, managing member of
general partner.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
ALCO CORP: Seeks Dismissal of Chapter 11 Case
---------------------------------------------
Alco Corporation asks the Bankruptcy Court to dismiss its Chapter
11 case for the benefit of all creditors and parties-in-interest
so as to allow it to resolve all pending matters outside of
bankruptcy and continue with the implementation of its confirmed
plan of reorganization.
The Debtor believes the dismissal will allow it to resolve more
efficiently all matters with Betteroads Asphalt ("BRA"), secured
creditor PR Asset Portfolio 2013-1 International, LLC, and the
bonding companies -- Travelers Casualty and Surety Company,
Reliance Insurance Company and MAPFRE PRAICO Insurance Company.
BRA and the Debtor were involved in state court litigation over
the collection of monies against the Debtor and its principals.
BRA also appealed the Bankruptcy Court's confirmation order on the
Debtor's Plan. The parties were eventually able to arrive at a
settlement in 2013. However, the Bonding Companies opposed the
settlement.
The Debtor eventually reached a settlement with the Bonding
Companies in January 2014.
Consequently however, the settlement with the Bonding Companies
was also opposed by PR Asset. No settlement has been reached with
PR Asset as of presstime.
As stated in open court at an April 2 hearing, all the parties
except for PR Asset favor the dismissal of the Debtor's case.
The Debtor maintains that if the case is dismissed, PR Asset will
suffer no harm. PR Asset holds a lien over the Debtor's primary
assets and is said to have obtained a judgment against the Debtor
prior to the bankruptcy filing. Thus, if dismissal is granted, PR
Asset has the alternative to execute its judgment and obtain an
adequate remedy in law in order to collect the remainder of the
claim which was unpaid.
On the other hand, the Debtor contends, conversion of the case
will burden the estate further since Chapter 7 administrative
expenses will accrue and the litigation in both adversary
proceedings and any other contested matter in the lead case will
continue.
PR Asset Replies
PR Asset is convinced that the Debtor's only intention through the
voluntary dismissal is to continue with its liquidation without
supervision of the Court and in detriment of creditors.
PR Asset thus asks the Court to deny the Motion for Voluntary
Dismissal and instead, order the conversion of the case to Chapter
7. It also asks the Court to bar the Debtor from refiling a
bankruptcy petition for 18 months.
PR Asset relates that it has a lien over all of the Debtor's asset
by virtue Banco de Popular de Puerto Rico's transfer of its claim
against the Debtor to PR Asset.
PR Asset complains that by entering into a stipulation with the
Bonding Companies, the Debtor unlawfully attempted to infringe on
PR Asset's existing liens and security interests. PR Asset cites
that the Debtor purported to grant the Bonding Companies with
adequate protection in the form of a valid, first rank lien, in
the Debtor's cash collateral.
Moreover, PR Asset contends, the Debtor accepts that it mismanaged
the estate when it admits that it has ceased operations in the
Canovanas Asphalt Plan.
PR Asset is convinced that the appointment of a Chapter 7 trustee
will allow payment to be obtained in an efficient and organized
manner.
May 7 Hearing
Judge Mildred Caban Flores will convene a hearing on May 7, 2014,
to consider the Debtor's request.
Alco Corp. is presented by:
C. Conde & Associates
Luisa S. Valle Castro, Esq.
254 San Jose Street, 5th Floor
Old San Juan, Puerto Rico 00901
Tel No: (787) 729-2900
Fax No: (787) 729-2203
ls.valle@condelaw.com
PR Asset is represented by:
O'Neill & Borges LLC
Ubaldo M. Fernandez, Esq.
American International Plaza
250 Munoz Rivera Ave., Suite 800
San Juan, Puerto Rico 00918-1813
Tel No: (787) 764-8181
Fax No: (787) 753-8944
Email: Ubaldo.Fernandez@oneillborges.com
About Alco Corp.
Alco Corporation in Dorado, Puerto Rico, filed for Chapter 11
bankruptcy (Bankr. D.P.R. Case No. 12-00139) on Jan. 12, 2012.
Carmen D. Conde Torres, Esq., and C. Conde & Associates represent
the Debtor in its restructuring effort. Alco tapped Jimenez
Vasquez & Associates, PSC, as accountants. The Debtor scheduled
$11.2 million in assets and $7.76 million in debts. The petition
was signed by Alfonso Rodriguez, president.
Bankruptcy Judge Mildred Caban Flores in Puerto Rico issued an
opinion and order on March 11, 2013, confirming the Amended
Chapter 11 Plan of Reorganization filed by Alco Corporation. The
Plan considers the full payment of all administrative, secured
creditors and priority claims and a 50% dividend to the general
unsecured creditors on monthly installments within 5 years from
the effective date.
ALION SCIENCE: Amends Refinancing Support Agreement
---------------------------------------------------
Alion Science and Technology has amended its refinancing support
agreement with the majority holders of its outstanding 10 1/4
percent Senior Notes due Feb. 1, 2015 (Unsecured Notes). The
amendment modifies certain terms of the existing agreement that
were initially entered into with the majority holders in December
2013 that contemplates the refinancing of Alion's debt
obligations. The amendment extends the majority holders'
commitment to support the refinancing from April 28 to July 31,
2014. Other amendments are further described in a Form 8-K filed
today by the company with the U.S. Securities and Exchange
Commission, a copy of which is available for free at:
http://is.gd/3UPh7s
"We are actively taking the necessary steps to ensure that our
operations continue smoothly as we move toward closing our
refinancing," said Alion Chairman and CEO Bahman Atefi. "By
agreeing to extend the outside date for closing, our creditors
have shown their confidence in our strategy and our long-term
ability to deliver on our obligations. We appreciate their
ongoing support."
In addition, Alion has entered into an amended and restated credit
agreement with Wells Fargo Bank, National Association, which
provides for a new revolving credit facility of $45 million, an
increase of $10 million from Alion's existing revolving credit
facility. Concurrent with the completion of the refinancing
transactions, the new $45 million Wells Fargo facility is expected
to be further increased into a $65 million revolving credit
facility, pending approvals.
"As we have stated in earlier filings, we have laid the groundwork
for a successful refinancing, which we believe will give us the
flexibility to sustain Alion's operations while we continue to
serve our customers fully and without interruption," CEO Atefi
explained. "We will continue to help our customers solve their
most difficult problems, support our partners and fulfill our
contractual commitments. The demand for Alion's solutions remains
strong. Our refinancing plans will allow us to continue focusing
on the technical strengths and deep customer relationships that
have been the foundation of our success."
A copy of the Amended and Restated Refinancing Support Agreement
is available for free at http://is.gd/5mwZaX
About Alion Science
Alion Science and Technology Corporation, based in McLean,
Virginia, is an employee-owned company that provides scientific
research, development, and engineering services related to
national defense, homeland security, and energy and environmental
analysis. Particular areas of expertise include communications,
wireless technology, netcentric warfare, modeling and simulation,
chemical and biological warfare, program management.
Alion Science has been reporting losses for four consecutive years
from Sept. 30, 2010, to Sept. 30, 2013. In 2013, Alion Science
incurred a net loss of $36.59 million.
Deloitte & Touche LLP, in McLean, Virginia, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Sept. 30, 2013. The independent auditors noted
that the Company does not expect to be able to repay its existing
debt at their scheduled maturities. The Company's financing
needs, its recurring net losses, and its excess of liabilities
over assets raise substantial doubt about its ability to continue
as a going concern, the auditors stated.
As of Dec. 31, 2013, the Company had $599.39 million in total
assets, $787.09 million in total liabilities, $61.89 million in
redeemable common stock, $20.78 million in common stock warrants,
$130,000 in accumulated other comprehensive loss and a $270.51
million accumulated deficit.
"Our liabilities exceed our assets which makes refinancing our
debt more difficult and expensive. Operating cash flow is
insufficient to repay the Secured and Unsecured Notes at maturity,
which raises substantial doubt as to the Company's ability to
continue as a going concern," the Company said in the Form 10-Q.
Bankruptcy Warning
Management's cash flow projections indicate that absent a
refinancing transaction or series of transactions, the Company
will be unable to pay the principal and accumulated unpaid
interest on its Secured Notes and Unsecured Notes when those
instruments mature in November 2014 and February 2015,
respectively. On Dec. 24, 2013, Alion entered into an agreement
with the holders of a majority of its Unsecured Notes regarding
certain possible refinancing transactions.
The proposed refinancing transactions involve: replacing Alion's
credit facility; refinancing the Secured Notes with $350 million
in new secured term loans; exchanging our Unsecured Notes for
either new third lien notes and a series of new warrants, or a
limited amount of cash for a portion of Unsecured Notes at a price
below par; payment of accrued and unpaid interest; and obtaining
certain consents from Unsecured Noteholders.
"However, management can provide no assurance that we will be able
to enter into definitive agreements regarding the terms of the
refinancing transactions or conclude a refinancing of our
Unsecured Notes, or that additional financing will be available to
retire or replace our Secured Notes, and if available, that terms
of any transaction would be favorable or compliant with the
conditions for such financing set forth in the Refinancing Support
Agreement. The Company's high debt levels, of which $332.5
million matures on November 1, 2014 and Alion's recurring losses
will likely make it more difficult for Alion to raise capital on
favorable terms and could hinder its operations. Further, default
under the Unsecured Note Indenture or the Secured Note Indenture
could allow lenders to declare all amounts outstanding under the
revolving credit facility, the Secured Notes and the Unsecured
Notes to be immediately due and payable. Any event of default
could have a material adverse effect on our business, financial
condition and operating results if creditors were to exercise
their rights, including proceeding against substantially all of
our assets that secure the Credit Agreement and the Secured Notes,
and will likely require us to invoke insolvency proceedings
including, but not limited to, a voluntary case under the U.S.
Bankruptcy Code," the Company said in its quarterly report for the
period ended Dec. 31, 2013.
* * *
As reported by the TCR on March 10, 2014, Standard & Poor's
Ratings Services said it lowered its corporate credit rating on
McLean, Va.-based Alion Science and Technology Corp. to 'CC' from
'CCC+'. "The ratings downgrade reflects a capital structure that
matures within 12 months, a currently 'weak' liquidity assessment,
which we revised from 'less than adequate', and our expectation
that we would classify an exchange offer or similar restructuring
undertaken by Alion as distressed," said Standard & Poor's credit
analyst Martha Toll-Reed.
ALLY FINANCIAL: Files Form 10-Q, Posts $227MM Net Income in Q1
--------------------------------------------------------------
Ally Financial Inc. filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing net income
of $227 million on $2.07 billion of total financing revenue and
other interest income for the three months ended March 31, 2014,
as compared with net income of $1.09 billion on $1.95 billion of
total financing revenue and other interest income for the same
period last year.
As of March 31, 2014, the Company had $148.45 billion in total
assets, $133.99 billion in total liabilities and $14.45 million in
total equity.
"In the first four months of the year, Ally completed several key
steps toward exiting TARP and positioning the company for longer-
term success," said Chief Executive Officer Michael A. Carpenter.
"The U.S. Treasury has received $5.4 billion so far this year
through a private placement of common stock and Ally's initial
public offering. As a result, the U.S. taxpayer received a return
of approximately $500 million on its original investment in the
company, and the U.S. Treasury's stake has been reduced to 17
percent."
"Ally continued to post strong performance in its core businesses,
with auto finance originations up $1 billion since the fourth
quarter of 2013, and new and used originations from diversified
dealers up 40 percent year-over-year," Carpenter continued.
"Retail deposit growth at Ally Bank continued steadily at $2
billion in the first quarter and the customer base expanded by 19
percent since the first quarter of 2013."
Ally's consolidated cash and cash equivalents increased to $5.9
billion as of Mar. 31, 2014, compared to $5.5 billion at Dec. 31,
2013. Included in this quarter's balance are: $2.5 billion at
Ally Bank and $1.2 billion at the Insurance business.
A copy of the Form 10-Q is available for free at:
http://is.gd/2cVEfB
Ally Financial has updated the Complete Text of Ally Demand Notes
Program, a copy of which is available for free at:
http://is.gd/q65E75
95-Mil. Shares
Ally Financial in March filed an amended Form S-1 registration
statement relating to the offering by the United States Department
of the Treasury of 95,000,000 shares of common stock of Ally
Financial Inc. Ally Financial Inc. will not receive any of the
proceeds from the sale of shares of common stock by the selling
stockholder.
This is the Company's initial public offering and no public market
exists for its shares. The Company anticipates that the initial
public offering price will be between $25.00 and $28.00 per share.
The Company has applied to list the common stock on the New York
Stock Exchange under the symbol "ALLY".
The selling stockholder has granted the underwriters the right to
purchase up to 14,250,000 additional shares of common stock to
cover over-allotments, if any, at the public offering price, less
the underwriters' discount, within 30 days from the date of the
prospectus.
A copy of the Form S-1/A is available for free at:
http://is.gd/HrH3IY
About Ally Financial
Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/--
is one of the world's largest automotive financial services
companies. The Company offers a full suite of automotive
financing products and services in key markets around the world.
Ally's other business units include mortgage operations and
commercial finance, and the company's subsidiary, Ally Bank,
offers online retail banking products. Ally operates as a bank
holding company.
GMAC obtained a $17 billion bailout from the U.S. government in
exchange for a 56.3 percent stake. Private equity firm Cerberus
Capital Management LP keeps 14.9 percent, while General Motors Co.
owns 6.7 percent.
* * *
As reported by the TCR on Dec. 16, 2013, Standard & Poor's Ratings
Services said it raised its issuer credit rating on Ally Financial
Inc. to 'BB' from 'B+'. "The upgrade reflects the company's
release from potential legal and financial liabilities stemming
from its ownership of ResCap," said Standard & Poor's credit
analyst Tom Connell.
In the April 3, 2014, edition of the TCR, Fitch Ratings has
upgraded Ally Financial Inc.'s long-term Issuer
Default Rating (IDR) and senior unsecured debt rating to 'BB+'
from 'BB'.
The rating upgrade reflects increased clarity around Ally's
ownership structure given Ally's recent announcement that it has
launched an initial public offering those shares of its common
stock held by the U.S. Treasury (the Treasury).
As reported by the TCR on Dec. 23, 2013, Moody's Investors Service
upgraded the corporate family rating (CFR) of Ally Financial Inc.
to Ba3 from B1. The upgrade of Ally's corporate family rating
follows the U.S. Bankruptcy Court's approval of ResCap LLC's
(unrated) Chapter 11 plan, which releases Ally from mortgage-
related creditor claims originating from its ownership of ResCap.
AMERICAN AXLE: Posts $33.6 Million Net Income in First Quarter
--------------------------------------------------------------
American Axle & Manufacturing Holdings, Inc., filed with the U.S.
Securities and Exchange Commission its quarterly report on Form
10-Q disclosing net income of $33.6 million on $858.8 million of
net sales for the three months ended March 31, 2014, as compared
with net income of $7.3 million on $755.6 million of net sales for
the same period last year.
As of March 31, 2014, the Company had $3.14 billion in total
assets, $3.06 billion in total liabilities and $83.3 million in
total stockholders' equity.
"AAM's financial results in the first quarter of 2014 reflect
strong sales growth that continues to outpace the industry," said
AAM's Chairman, president and chief executive officer, David C.
Dauch. "AAM's top priority in 2014 is to flawlessly launch our
new business backlog which will drive higher profitability,
improve free cash flow generation and enhance business
diversification for our fast-growing company. We remain committed
to delivering world-class quality products, maintaining
operational excellence at every one of our 35 global facilities
and demonstrating technology leadership by continuing to develop
innovative driveline solutions for the global automotive market."
A copy of the Form 10-Q is available for free at:
http://is.gd/t2Van9
Meeting Results
On May 1, 2014, American Axle held its annual meeting of
stockholders at which the stockholders:
(1) elected James A. McCaslin, William P. Miller II, and Samuel
Valenti III as directors to serve for three-year terms
expiring at the annual meeting of stockholders in 2017;
(2) approved, on an advisory basis, the compensation of AAM's
named executive officers; and
(3) ratified the appointment of Deloitte & Touche LLP as AAM's
independent registered public accounting firm for the year
ending Dec. 31, 2014.
About American Axle
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings Inc. (NYSE: AXL) -- http://www.aam.com/-- manufactures,
engineers, designs and validates driveline and drivetrain systems
and related components and chassis modules for light trucks, sport
utility vehicles, passenger cars, crossover vehicles and
commercial vehicles.
* * *
In September 2012, Moody's Investors Service affirmed the 'B1'
Corporate Family Rating (CFR) and Probability of Default Rating
(PDR) of American Axle.
American Axle carries a 'BB-' corporate credit rating from
Standard & Poor's Ratings Services. "The 'BB-' corporate credit
rating on American Axle reflects the company's 'weak' business
risk profile and 'aggressive' financial risk profile, which
incorporate substantial exposure to the highly cyclical light-
vehicle market," S&P said, as reported by the TCR on Sept. 6,
2012.
As reported by the TCR on Sept. 5, 2013, Fitch Ratings has
affirmed the 'B+' Issuer Default Ratings of American Axle &
Manufacturing Holdings, Inc. (AXL) and its American Axle &
Manufacturing, Inc. (AAM) subsidiary. The ratings and Positive
Outlook for AXL and AAM are supported by Fitch's expectation that
the drivetrain and driveline supplier's credit profile will
strengthen over the intermediate term, despite some deterioration
over the past year.
AMERICAN COMMERCE: To Issue 121.5 Million Shares Under Plan
-----------------------------------------------------------
American Commerce Solutions, Inc., filed a Form S-8 prospectus
with the U.S. Securities and Exchange Commission to register an
aggregate of 121,568,627 shares of common stock issuable to Daniel
L. Hefner, Robert Maxwell, Sr., and Robert Maxwell, Jr., under the
Accrued Employee Debt/Compensation Plan for a proposed maximum
aggregate offering price of $310,000. A copy of the prospectus is
available at http://is.gd/jyCZ44
About American Commerce
American Commerce Solutions, Inc., headquartered in Bartow,
Florida, is primarily a holding company with one wholly owned
subsidiary; International Machine and Welding, Inc., is engaged in
the machining and fabrication of parts used in heavy industry, and
parts sales and service for heavy construction equipment.
American Commerce incurred a net loss available to common
stockholders of $5,791 on $2.35 million of net sales for the year
ended Feb. 28, 2013, as compared with net income available to
common stockholders of $25,962 on $2.44 million of net sales for
the year ended Feb. 29, 2012.
Messineo & Co., CPAs LLC, in Clearwater, Florida, issued a "going
concern" qualification on the consolidated financial statements
for the fiscal year ended Feb. 28, 2013. The independent auditors
noted that the Company has recurring losses and negative cash
flows from operating activities, a working capital deficit, and a
stockholders' deficit. These conditions raise substantial doubt
about its ability to continue as a going concern.
ANIL INC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: Anil Inc.
6415 Atlanta Highway
Alpharetta, GA 30004
Case No.: 14-59001
Chapter 11 Petition Date: May 5, 2014
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Debtor's Counsel: Leonard R. Medley, III, Esq.
MEDLEY & ASSOCIATES, LLC
Suite 1770 - Bldg. 2
2727 Paces Ferry Road
Atlanta, GA 30339
Tel: (770) 319-7592
Fax: (770) 319-7594
Email: leonard@mkalaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Yasmeen Kakani, president.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
ARROW ALUMINUM: Had Case Dismissed and Closed
---------------------------------------------
Bankruptcy Judge Jennie D. Latta granted the U.S. Trustee's motion
seeking dismissal of the Chapter 11 case of Arrow Aluminum
Industries, Inc.
As previously reported by The Troubled Company Reporter, the U.S.
Trustee sought the case dismissal asserting that the Debtor is
unable to propose a confirmable plan.
In a ruling issued in early March 2014, the judge found good
grounds for the dismissal.
The Debtor was ordered to file any outstanding monthly operating
reports and pay any outstanding quarterly fees accrued pursuant to
28 U.S.C. 1930(a)(6) without delay.
In late March 2014, the judge further authorized the bankruptcy
court clerk to close the case.
The Assistant U.S. Trustee can be reached at:
Madalyn Scott Greenwood
Assistant U.S. Trustee
200 Jefferson Avenue, Suite 400
Memphis, TN 38103
901-544-3667
Email: madalyn.s.greenwood@usdoj.gov
About Arrow Aluminum
Arrow Aluminum Industries, Inc., filed a Chapter 11 petition
(Bankr. W.D. Tenn. Case No. 13-21470) in Memphis on Feb. 11, 2013.
The petition was signed by William Ted Blackwell as president.
The Debtor has scheduled assets of $126,246,137 and scheduled
liabilities of $3,130,103. The Debtor is represented by
Steven N. Douglass, Esq., at Harris Shelton Hanover Walsh, PLLC.
This is the Debtor's third Chapter 11 case. The previous two
cases were assigned Nos. 11-21215 and 12-13482. Both of the
previous two Chapter 11 cases were dismissed without a Plan of
Reorganization having been approved.
The Debtor's Plan provides for Arrow's primary creditor, First
Citizens National Bank, to receive a secured claim for the
equipment and the insider principals obtaining reverse mortgages
on their homes and properties to pay Citizens Bank.
On Sept. 5, 2013, the Court entered an order approving the
disclosure statement explaining the Debtor's Plan.
AUXILIUM PHARMACEUTICALS: Moody's Cuts Corp. Family Rating to B3
----------------------------------------------------------------
Moody's Investors Service downgraded the ratings of Auxilium
Pharmaceuticals, Inc., including the Corporate Family Rating to B3
from B2, the Probability of Default Rating to B3-PD from B2-PD,
and the senior secured term loan facility to Ba3 from Ba2. At the
same time, Moody's lowered the Speculative Grade Liquidity Rating
to SGL-4 from SGL-2. The outlook is negative.
Ratings lowered:
Corporate Family Rating to B3 from B2
Probability of Default Rating to B3-PD from B2-PD
Senior secured term loan to Ba3 (LGD2, 17%) from Ba2 (LGD2, 17%)
Speculative Grade Liquidity Rating to SGL-4 from SGL-2
"The downgrade reflects Moody's expectations that declines in
Testim, Auxilium's testosterone gel, will materially reduce EBITDA
in 2014, resulting in negative free cash flow, a weakening
liquidity profile, and extremely high debt/EBITDA," said Moody's
Senior Vice President Michael Levesque.
The change in the Speculative Grade Liquidity rating to SGL-4
reflects expectations of negative near-term cash flow that will
reduce Auxilium's cash and short-term investments, which stood at
$76.7 million as of March 31, 2014. The term loan does not have
any financial maintenance covenants, but there is no revolving
credit facility to provide external liquidity.
Ratings Rationale
Auxilium's B3 rating reflects its modest size and scale, it's very
high leverage, significant revenue concentration in its top three
products and its weak cash flow. Due to a shrinking testosterone
gel market, intense reimbursement and competitive pressures as
well as recent negative medical studies, Moody's believes that
Testim sales will decline to less than $85 million in 2014
compared to $211 million in 2013. That said, growth in Xiaflex and
Stendra will partially offset the Testim losses and should drive
improvement in the company's EBITDA in 2015. Products acquired
from Actient including Testopel and Edex will also grow, partially
offsetting some of the declines. The B3 rating also reflects the
company's niche focus in urology, and new growth drivers Xiaflex
in Peyronie's Disease and the acquired rights to Stendra.
The negative outlook reflects Auxilium's weak liquidity profile as
well as concerns that EBITDA will not improve in 2015 if any of
the growth drivers falter or if there is generic competition for
Testim.
The ratings could be downgraded if the company's liquidity profile
materially weakens. Such a scenario could arise from a combination
of steep Testim declines or slow growth in other products.
Although not expected over the term, the ratings could be upgraded
if growth in Xiaflex, Stendra and other products accelerates such
that debt/EBITDA is sustained below 5.0 times.
Headquartered in Chesterbook, Pennsylvania, Auxilium
Pharmaceuticals, Inc. ("Auxilium") is a niche pharmaceutical
company with a focus on urological diseases and other specialty
areas. Auxilium reported $400 million of revenue in 2013
including revenue from Actient Holdings LLC, acquired on April 26,
2013.
B/E AEROSPACE: S&P Alters Outlook to Developing & Affirms BB+ CCR
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its rating
outlook on B/E Aerospace Inc. to developing from stable and
affirmed its 'BB+' corporate credit rating on the company.
On May 4, 2014, B/E Aerospace announced that it will be exploring
strategic alternatives that could include a possible sale or
merger of the company, or spin-off of some of its businesses. The
company has not set a timeframe for this process or provided any
further details.
The outlook is developing. "We will evaluate the impact of B/E
Aerospace's strategic review once it is complete and the company
announces the results," said Standard & Poor's credit analyst
Christopher Denicolo. "We could raise, lower, or affirm the
rating on the company, depending on the impact any of its
strategic actions has on its credit quality."
S&P could raise the rating if the outcome of the company's
strategic review results in an improvement in its business or
financial risk profiles. S&P could also raise the rating if the
company decides not to take any strategic actions and funds from
operations (FFO) to total debt increases above 35% and debt to
EBITDA falls below 2.5x.
S&P could lower the rating if the outcome of the company's
strategic review results in a significant deterioration in B/E
Aerospace's business or financial risk profiles. S&P could also
lower the rating if the company decides not to take any strategic
actions and debt to EBITDA increases to above 4x or FFO to debt
falls below 20% for a sustained period.
BAHIA DEL SOL HOTEL: Case Summary & 10 Top Unsecured Creditors
--------------------------------------------------------------
Debtor: Bahia Del Sol Hotel Corporation
dba Hotel Casa Blanca
PO Box 9050
Old San Juan, PR 00902
Case No.: 14-03695
Chapter 11 Petition Date: May 5, 2014
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Judge: Hon. Mildred Caban Flores
Debtor's Counsel: Victor Gratacos Diaz, Esq.
VICTOR GRATACOS-DIAZ LEGAL OFFICE
P O BOX 7571
Caguas, PR 00726
Tel: 787 746-4772
Email: bankruptcy@gratacoslaw.com
Total Assets: $400,000
Total Liabilities: $9.78 million
The petition was signed by Luis A Alvarez Cabrera, owner.
A list of the Debtor's 10 largest unsecured creditors is available
for free at http://bankrupt.com/misc/prb14-03695.pdf
BEAZER HOMES: Incurs $7.9 Million Net Loss in 2nd Quarter
---------------------------------------------------------
Beazer Homes USA, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $7.97 million on $270.02 million of total revenue
for the three months ended March 31, 2014, as compared with a net
loss of $19.64 million on $287.90 million of total revenue for the
same period in 2013.
For the six months ended March 31, 2014, the Company had a net
loss of $13.11 million on $563.19 million of total revenue as
compared with a net loss of $40.02 million on $534.80 million of
total revenue for the same period in 2013.
As of March 31, 2014, the Company had $1.95 billion in total
assets, $1.72 billion in total liabilities and $230.79 million in
total stockholders' equity.
"Despite inclement weather and a slower start to the spring
selling season than anticipated, we made further progress on our
operational and financial objectives during the quarter," said
Allan Merrill, president and CEO of Beazer Homes. "We exceeded
our expectations for sales per community, increased gross margins,
improved adjusted EBITDA and invested heavily for our long-term
growth. These results allow us to reaffirm our confidence in
delivering full year profitability in Fiscal 2014 and in making
substantial progress on our multi-year "2B-10" target this year."
A copy of the Form 10-Q is available for free at:
http://is.gd/invDP2
About Beazer Homes
Beazer Homes USA, Inc. (NYSE: BZH) -- http://www.beazer.com/--
headquartered in Atlanta, is one of the country's 10 largest
single-family homebuilders with continuing operations in Arizona,
California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada,
New Jersey, New Mexico, North Carolina, Pennsylvania, South
Carolina, Tennessee, Texas, and Virginia. Beazer Homes is listed
on the New York Stock Exchange under the ticker symbol "BZH."
Beazer Homes incurred a net loss of $33.86 million for the year
ended Sept. 30, 2013, a net loss of $145.32 million for the year
ended Sept. 30, 2012, and a net loss of $204.85 million for the
year ended Sept. 30, 2011.
As of Dec. 31, 2013, the Company had $1.93 billion in total
assets, $1.69 billion in total liabilities and $235.60 million in
total stockholders' equity.
* * *
Beazer carries a 'B-' issuer credit rating, with "negative"
outlook, from Standard & Poor's.
In the Jan. 30, 2013 edition of the TCR, Moody's Investors Service
raised Beazer Homes USA, Inc.'s corporate family rating to 'Caa1'
from 'Caa2' and probability of default rating to 'Caa1-PD' from
'Caa2-PD'. The ratings upgrade reflects Moody's increasing
confidence that Beazer's credit metrics, buoyed by a stregthening
housing market, will gradually improve for at least the next two
years and that the company may be able to return to a modestly
profitable position as early as fiscal 2014.
As reported by the TCR on Sept. 10, 2012, Fitch Ratings has
upgraded the Issuer Default Rating (IDR) of Beazer Homes USA, Inc.
(NYSE: BZH) to 'B-' from 'CCC'. The upgrade and the stable
outlook reflect Beazer's operating performance so far this year,
its robust cash position, and moderately better prospects for the
housing sector during the remainder of this year and in 2013. The
rating is also supported by the company's execution of its
business model, land policies, and geographic diversity.
BEHRINGER HARVARD: Had $16.2MM Assets in Liquidation at Dec. 31
---------------------------------------------------------------
Behringer Harvard Short-Term Opportunity Liquidating Trust filed
with the U.S. Securities and Exchange Commission its annual report
on Form 20-F disclosing $62.06 million in total assets, $45.85
million in total liabilities and $16.21 million in net assets in
liquidation at Dec. 31, 2013.
Plan of Liquidation
On Feb. 11, 2013, the Partnership completed its liquidation
pursuant to a Plan of Liquidation adopted by Behringer Harvard
Advisors II LP, as its general partner. The Plan provided for the
formation of a liquidating trust, Behringer Harvard Short-Term
Opportunity Liquidating Trust for the purpose of completing the
liquidation of the assets of the Partnership. In furtherance of
the Plan, the Partnership entered into a Liquidating Trust
Agreement with one of the Partnership's General Partners,
Behringer Advisors II, as managing trustee, and CSC Trust Company
of Delaware, as resident trustee. As of the Effective Date, each
of the holders of limited partnership units in the Partnership
received a pro rata beneficial interest in the Liquidating Trust
in exchange for such holder's interest in the Partnership. In
accordance with the Plan and the Liquidating Trust Agreement, the
Partnership has transferred all of its remaining assets and
liabilities to us to be administered, disposed of or provided for
in accordance with the terms and conditions set forth in the
Liquidating Trust Agreement. The General Partners elected to
liquidate the Partnership and transfer its remaining assets and
liabilities to the Liquidating Trust as a cost saving alternative
that the General Partners believed to be in the best interests of
the investors. The expenses associated with operating a public
reporting entity, like the Partnership, are comparatively high and
therefore detract from distributable proceeds and returns it can
make to its investors. The reorganization into a liquidating
trust enables us to reduce costs associated with public reporting
obligations and related audit expenses that are not applicable to
the Liquidating Trust, helping to preserve capital throughout our
disposition phase for the benefit of our investors. Cutting
expenses and maximizing investor returns is a primary focus in
this disposition phase.
The Company's principal demands for funds in the next twelve
months and beyond will be for the payment of operating expenses,
costs associated with lease-up and capital improvements for our
remaining operating property and for the payment of recurring debt
service, further principal paydowns and reserve requirements on
our outstanding indebtedness as required by our lenders.
The Liquidating Trust had notes payable totaling $40.7 million at
Dec. 31, 2013, of which $31 million was secured by the hotel
property and $8.8 million was to Behringer Harvard Holdings, LLC,
a related party.
A copy of the Form 10-K is available for free at:
http://is.gd/4vroSC
About Behringer Harvard
Addison, Tex.-based Behringer Harvard is a limited partnership
formed in Texas on July 30, 2002. The Company's general partners
are Behringer Harvard Advisors II LP and Robert M. Behringer. As
of Sept. 30, 2011, seven of the twelve properties the Company
acquired remain in the Company's portfolio. The Company's
Agreement of Limited Partnership, as amended, provides that the
Company will continue in existence until the earlier of Dec. 31,
2017, or termination of the Partnership pursuant to the
dissolution and termination provisions of the Partnership
Agreement.
BERRY PLASTICS: Moody's Rates New 2nd Senior Secured Notes 'Caa1'
-----------------------------------------------------------------
Moody's Investors Service assigned a Caa1 rating to the proposed
Second Priority Senior Secured Notes of Berry Plastics
Corporation. The company's B2 Corporate Family and B2-PD
Probability of Default remain unchanged. Instrument ratings are
detailed below. The ratings outlook is stable. The proceeds of the
new $500 million Second Priority Senior Secured Notes due May 2022
will be used to refinance the $500 million Second Priority Senior
Secured Notes due May 2018. Terms and conditions are expected to
be identical to the existing Second Priority Senior Secured Notes
due May 2018.
Moody's assigned the following rating:
Berry Plastics Corporation
Assigned Caa1 (LGD 5, 85%) to $500 million Second Priority
Senior Secured Notes due May 2022
The following ratings are unchanged:
$1,400 million 1st Lien Senior Secured Term Loan D due February
2020, B1 (LGD 3, 36%)
$1,125 mm senior secured first lien term loan due January 2021,
B1 (LGD 3, 36%)
$500 million Second Priority Senior Secured Notes due May 2018,
Caa1 (LGD 5, 85%) (to be withdrawn at the close of the
transaction)
$800 million Second Priority Senior Secured Notes due May 2021,
Caa1 (LGD 5, 85%)
Berry Plastics Group, Inc.
Corporate Family Rating, B2
Probability of Default Rating, B2-PD
Speculative Grade Liquidity Rating, SGL-2
The ratings outlook is stable.
The ratings are subject to the receipt and review of the final
documentation.
Ratings Rationale
Berry's B2 Corporate Family Rating reflects the company's exposure
to more cyclical end markets, relatively fair contract position
with customers and high percentage of commodity products. The
rating also reflects the fragmented and competitive industry
structure and fair contract position with customers.
Strengths in Berry's competitive profile include its scale,
concentration of sales in food and beverage packaging, and good
liquidity. The company's strengths also include a strong
competitive position in rigid plastic containers and continues to
focus on producing innovative products. Berry also has good
liquidity.
The rating could be downgraded if there is deterioration in the
credit metrics, liquidity or the operating and competitive
environment. Additional debt financed acquisitions, excessive
acquisitions (regardless of financing) and/or a move to a more
aggressive financial profile could also prompt a downgrade.
Specifically, the rating could be downgraded if total adjusted
debt to EBITDA rises above 6.0 times, EBITA to gross interest
coverage declines below 1.5 time, the EBITA margin declines below
the high single digits, and/or free cash flow to debt declines
below the mid single digits.
The ratings could be upgraded if the company sustainably improves
credit metrics within the context of a stable operating and
competitive environment while maintaining good liquidity. An
upgrade would also be dependent upon maintenance of good liquidity
and less aggressive financial and acquisition policies. The
ratings could be upgraded if adjusted total debt to EBITDA moves
below 5.0 times, free cash flow to debt moves up to the high
single digit range, the EBITA margin improves to the double digit
range, and EBITA to gross interest coverage moves above 1.9 times.
Based in Evansville, Indiana, Berry Plastics Corporation is a
supplier of plastic packaging products, serving customers in the
food and beverage, healthcare, household chemicals, personal care,
home improvement, and other industries. The North American
operation represents 96% of the Company's net sales. Polypropylene
and polyethylene account for the majority of plastic resin
purchases. Net sales for the 12 months ended December 31, 2013
totaled approximately $4.7 billion.
BERRY PLASTICS: S&P Raises CCR to 'B+' & Rates $500MM Notes 'B-'
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Evansville, Ind.-based plastic packaging producer Berry
Plastics Corp. to 'B+' from 'B'. The outlook is stable.
S&P assigned a 'B-' issue-level rating and '6' recovery rating to
the proposed $500 million of second-priority lien notes due 2022.
The '6' recovery rating indicates S&P's expectation of a
negligible (0% to 10%) recovery in the event of a payment default.
S&P raised the issue-level ratings on Berry's existing first-
priority debt to 'BB-' from 'B+'; the recovery rating remains
unchanged at '2'. The '2' recovery rating indicates S&P's
expectation of a substantial (70% to 90%) recovery in the event of
payment default.
S&P also raised the issue-level ratings on the company's existing
second-priority debt to 'B-' from 'CCC+'; the recovery rating
remains unchanged at '6'. The '6' recovery rating indicates S&P's
expectation of a negligible (0% to 10%) recovery in the event of a
payment default.
Based on the company's commitment to reduce leverage and the
reduced ownership by Apollo, S&P revised its assessment of Berry
Plastic Corp.'s financial policy to neutral.
"The upgrade also reflects modestly improving credit measures
supported by further expected debt reduction and a gradual
strengthening in operating trends," said Standard & Poor's credit
analyst Henry Fukuchi. The company has publicly stated its intent
to reduce leverage by about 0.5x a year. In addition, S&P expects
favorable business conditions resulting in increased volumes, and
manageable raw material costs, should support improving operating
trends. Also, with the financial sponsor (Apollo) ownership at
about 20%, S&P believes management will act on its publicly
announced intent to reduce leverage. In light of this change, S&P
has reassessed its view on financial policy to have a neutral
effect on ratings compared with S&P's negative view (-1 notch)
earlier. However, S&P continues to use the comparative ratings
modifier to lower the anchor score by one notch. This reflects
S&P's expectation that credit metrics will remain at the weaker
end of the aggressive financial risk profile in the near term.
S&P's ratings on Berry reflect its "aggressive" financial risk
profile and "fair" business risk profile. The ratings also
incorporate S&P's expectation of modestly improving volumes,
manageable raw materials costs, ongoing cost-reduction efforts,
positive free cash generation, and leverage improvement of about
0.5x annually in the next few years.
Berry is a leading producer of rigid plastic packaging products
for relatively stable dairy, food, beverage, health care, and
other consumer product applications. It also manufactures
flexible packaging products, some of which serve more-cyclical end
markets. Berry is a leading supplier of plastic injection-molded
and thermoformed open-top containers, aerosol overcaps, drinking
cups, housewares, and closures for the food, beverage, and health
care industries. EBITDA margins in the rigid-packaging business
have been attractive at 15% to 20%.
The stable outlook reflects gradually improving operating trends
and deleveraging at about 0.5x annually which should continue to
support the aggressive financial risk profile during the next
year. During this period, S&P anticipates that Berry will
continue to undertake small bolt-on acquisitions as a part of its
growth strategy while maintaining its aggressive financial risk
profile. The stable outlook also reflects the maintenance of
adequate liquidity and financial policies consistent with the 0.5x
annual reduction in leverage.
S&P could raise the ratings by one notch if adjusted debt to
EBITDA decreases to about 4.5x and FFO to total adjusted debt
increases to slightly over 15% and remains consistent through the
business cycle. This scenario could occur if EBITDA margins
increase by 200 basis points. In addition, for a higher rating,
S&P would also need to be confident that future financial policy
decisions related to growth, acquisitions, and shareholder rewards
would remain consistent with the ratings.
S&P considers a downgrade unlikely at this time, given the
relative stability of most of Berry's end markets, sufficient
liquidity, and S&P's view that the company will not pursue large
leveraging acquisitions given its focus on de-leveraging.
However, S&P could lower the rating if price competition, weaker
operating results, or unexpected cash outlays related to capital
expansion or shareholder rewards deplete Berry's liquidity, such
that revolver availability declines significantly. In addition,
S&P could lower the ratings if EBITDA margins weaken by 300 basis
points, or if volumes decrease by 20% or more from current levels.
S&P believes this would drive adjusted debt to EBITDA above 5x and
FFO to adjusted debt below 10%.
BG MEDICINE: Incurs $15.8 Million Net Loss in 2013
--------------------------------------------------
BG Medicine, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$15.84 million on $4.07 million of total revenues for the year
ended Dec. 31, 2013, as compared with a net loss of $23.76 million
on $2.81 million of total revenues during the prior year.
As of Dec. 31, 2013, the Company had $9.35 million in total
assets, $10.42 million in total liabilities and a $1.06 million
total stockholders' deficit.
Deloitte & Touche LLP, in Boston, Massachusetts, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2013. The independent auditors noted
that the Company's recurring losses from operations, recurring
cash used in operating cash flows and stockholders' deficit raise
substantial doubt about its ability to continue as a going
concern.
A copy of the Form 10-K is available for free at:
http://is.gd/gOyxew
About BG Medicine
Waltham, Mass.-based BG Medicine is a diagnostics company focused
on the development and commercialization of novel cardiovascular
diagnostic tests to address significant unmet medical needs,
improve patient outcomes and contain healthcare costs. The
Company is currently commercializing two diagnostic tests, the
first of which is the BGM Galectin-3 test, a novel assay for
measuring galectin-3 levels in blood plasma or serum for use as an
aid in assessing the prognosis of patients diagnosed with heart
failure. The Company's second diagnostic test is the CardioSCORE
test, which is designed to identify individuals at high risk for
near-term, significant cardiovascular events, such as heart attack
and stroke.
BROADWAY FINANCIAL: Incurs $41,000 Net Loss in Fourth Quarter
-------------------------------------------------------------
Broadway Financial Corporation reported a net loss of $41,000 on
$4.06 million of total interest income for the three months ended
Dec. 31, 2013, as compared with a net loss of $650,000 on $4.48
million of total interest income for the same period in 2012.
For the 12 months ended Dec. 31, 2013, the Company reported a net
loss of $301,000 on $15.96 million of total interest income as
compared with net income of $588,000 on $19.89 million of total
interest income during the prior year.
As of Dec. 31, 2013, the Company had $332.48 million in total
assets, $306.89 million in total liabilities and $25.59 million in
total stockholders' equity.
Chief Executive Officer, Wayne Bradshaw stated, "I am pleased to
announce that we achieved our major goals for calendar 2013, which
represents a pivotal year in Broadway's history. On the operating
side of our business, we successfully reduced our non-performing
assets by over 56%. On the capital side of the Company, we
completed the Recapitalization and related financing activities
that strengthened both the Bank and the Company. At year end, the
Bank's Tier 1 capital ratio was 10.24% and its Total Risk-Based
Capital ratio was 16.95%. The Company now has a simple equity
capital structure with only common stock and non-voting common
stock outstanding and reduced liabilities. In addition, the
Recapitalization allowed us to reduce the Company's annual
servicing requirement for its debt and preferred stock by $1.2
million."
A copy of the press release is available for free at:
http://is.gd/PC0iaM
About Broadway Financial
Los Angeles, Calif.-based Broadway Financial Corporation was
incorporated under Delaware law in 1995 for the purpose of
acquiring and holding all of the outstanding capital stock of
Broadway Federal Savings and Loan Association as part of the
Bank's conversion from a federally chartered mutual savings
association to a federally chartered stock savings bank. In
connection with the conversion, the Bank's name was changed to
Broadway Federal Bank, f.s.b. The conversion was completed, and
the Bank became a wholly owned subsidiary of the Company, in
January 1996.
The Company is currently regulated by the Board of Governors of
the Federal Reserve System. The Bank is currently regulated by
the Office of the Comptroller of the Currency and the Federal
Deposit Insurance Corporation.
Broadway Financial disclosed net income of $588,000 on
$19.89 million of total interest income for the year ended
Dec. 31, 2012, as compared with a net loss of $14.25 million on
$25.11 million of total interest income during the prior year.
Crowe Horwath LLP, in Sacramento, California, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that the Company has a tax sharing liability to its consolidated
subsidiary that exceeds its available cash, the Company is in
default under the terms of a $5 million line of credit with
another financial institution lender in which the stock of its
subsidiary bank, Broadway Federal Bank is held as collateral for
the line of credit and the Company and the Bank are both under
formal regulatory agreements. Furthermore, the Company and the
Bank are not in compliance with these agreements and the Company's
and the Bank's capital plan that was submitted under the
agreements has been preliminarily approved subject to completion
of its recapitalization. Failure to comply with these agreements
exposes the Company and the Bank to further regulatory sanctions
that may include placing the Bank into receivership. These
matters raise substantial doubt about the ability of Broadway
Financial Corporation to continue as a going concern.
BROWN DOG FARM: Case Summary & 5 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Brown Dog Farm, LLC
4112 Airline Road
McDonough, GA 30252
Case No.: 14-58985
Chapter 11 Petition Date: May 5, 2014
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Debtor's Counsel: Michael D. Robl, Esq.
THE SPEARS & ROBL LAW FIRM, LLC
104 Cambridge Avenue
Decatur, GA 30030
Tel: 404-373-5153
Email: mdrobl@tsrlaw.com
Total Assets: $1.80 million
Total Liabilities: $1.03 million
The petition was signed by Debra Andrews, administrator.
A list of the Debtor's five largest unsecured creditors is
available for free at http://bankrupt.com/misc/ganb14-58985.pdf
BUILDERS FIRSTSOURCE: Reports $3.4-Mil. Net Loss in 1st Quarter
---------------------------------------------------------------
Builders Firstsource, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing a
net loss of $3.38 million on $345.91 million of sales for the
three months ended March 31, 2014, as compared with a net loss of
$11.81 million on $319.70 million of sales for the same period in
2013.
The Company's balance sheet at March 31, 2014, showed $542.80
million in total assets, $530.20 million in total liabilities and
$12.59 million in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/Y0DbJJ
About Builders FirstSource
Headquartered in Dallas, Texas, Builders FirstSource Inc. --
http://www.bldr.com/-- supplies and manufactures building
products for residential new construction. The Company operates
in nine states, principally in the southern and eastern United
States, and has 55 distribution centers and 51 manufacturing
facilities, many of which are located on the same premises as its
distribution facilities.
* * *
As reported by the TCR on May 15, 2013, Standard & Poor's Ratings
Services Inc. said it raised its corporate credit rating on
Dallas-based Builders FirstSource to 'B' from 'CCC'. "The upgrade
acknowledges U.S.-based building materials manufacturer and
distributor Builders FirstSource Inc.'s 'strong' liquidity based
on the company's proposed recapitalization," said Standard &
Poor's credit analyst James Fielding.
Builders FirstSource carries a Caa1 Corporate Family Rating from
Moody's Investors Service.
CAESARS ENTERTAINMENT: Tries to Strengthen Unit Through New Debt
----------------------------------------------------------------
Emily Glazer, writing for The Wall Street Journal, reported that
Caesars Entertainment Corp. announced a series of refinancings and
other transactions for a key subsidiary, another step in the
casino giant's effort to restructure its heavy debt load and
strengthen its healthier businesses.
According to the report, the subsidiary, Caesars Entertainment
Operating Co., plans to sell $1.75 billion in new debt to cover
its 2015 maturities and repay some existing bank debt, buying the
parent company more time to restructure the unit.
Caesars also said it would sell 5% of equity in the subsidiary,
known as CEOC, to unnamed institutional investors and hopes to
pursue a public listing of these shares in the future, the report
related.
It is amending one of CEOC's credit facilities, giving it some
breathing room from covenants, or debt terms designed to protect
its lenders, the report further related.
The company also said it plans to add two new independent board
directors to CEOC once they are approved by regulators, the
Journal added.
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.
-- http://www.caesars.com/-- is one of the world's largest casino
companies, with annual revenue of $4.2 billion, 20 properties on
three continents, more than 25,000 hotel rooms, two million square
feet of casino space and 50,000 employees. Caesars casino resorts
operate under the Caesars, Bally's, Flamingo, Grand Casinos,
Hilton and Paris brand names. The Company has its corporate
headquarters in Las Vegas.
Harrah's announced its re-branding to Caesar's on mid-November
2010.
The Company incurred a net loss of $1.49 billion on $8.58 billion
of net revenues for the year ended Dec. 31, 2012, as compared with
a net loss of $666.70 million on $8.57 billion of net revenues
during the prior year. The Company's balance sheet at Sept. 30,
2013, showed $26.09 billion in total assets, $27.59 billion in
total liabilities and a $1.49 billion total deficit.
* * *
Caesars Entertainment carries a 'CCC' long-term issuer default
rating, with negative outlook, from Fitch and a 'Caa1' corporate
family rating with negative outlook from Moody's Investors
Service.
As reported in the TCR on Feb. 5, 2013, Moody's Investors Service
lowered the Speculative Grade Liquidity rating of Caesars
Entertainment Corporation to SGL-3 from SGL-2, reflecting
declining revolver availability and Moody's concerns that Caesars'
earnings and cash flow will remain under pressure causing the
company's negative cash flow to worsen.
In the May 7, 2013, edition of the TCR, Standard & Poor's Ratings
Services said that it lowered its corporate credit ratings on Las
Vegas-based Caesars Entertainment Corp. (CEC) and wholly owned
subsidiary Caesars Entertainment Operating Co. (CEOC) to 'CCC+'
from 'B-'.
"The downgrade reflects weaker-than-expected operating performance
in the first quarter, and our view that Caesars' capital structure
may be unsustainable over the next two years based on our EBITDA
forecast for the company," said Standard & Poor's credit analyst
Melissa Long.
C&K MARKET: Doesn't Owe Lender Breakup Fee Over Financing
---------------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that C&K Market Inc., a chain of 40 grocery stores, isn't
required to pay a $250,000 breakup fee to a prospective lender who
signed an enforceable contract before bankruptcy to finance the
Chapter 11 effort, U.S. Bankruptcy Judge Frank R. Alley III ruled
in Eugene, Oregon.
According to the report, just before bankruptcy in November, C&K
signed what Alley called an enforceable term sheet with Sunstone
Business Finance LLC to supply from $5 million to $7.5 million in
secured financing for the reorganization. Even though the amount
and all loan terms hadn't been decided, Judge Alley nonetheless
said the term sheet was an enforceable contract.
The contract called for Sunstone to have a $250,000 breakup fee if
C&K got court authority to borrow from another lender, the report
related. Insisting that its lien not be subordinated to another
lender, the existing lender eventually got court approval to
finance the bankruptcy, on terms more inexpensive than those
offered by Sunstone.
Judge Alley ruled that Sunstone wasn't entitled to be paid
$250,000 as an expense of the Chapter 11 case, the report related.
Judge Alley recited familiar law that an administrative expense
claim requires a ?direct and substantial? benefit to the Chapter
11 case.
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 Debtor is 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 Debtor's financial advisor. Kieckhafer Schiffer &
Company LLP serves as advisors and consultants to communicate with
lenders, brokers, attorneys and other professionals. Henderson
Bennington Moshofsky, P.C., serves as accountants. Watkinson
Laird Rubenstein Baldwin & Burgess PC serves as labor counsel.
The Debtor hired Great American Group, LLC, to conduct store
closing sales. Kurtzman Carson Consultants is the Debtor's
noticing agent.
An Official Committee of Unsecured Creditors appointed in the
Debtor's case 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.
CELL THERAPEUTICS: Had $39.6MM Financial Standing at Feb. 28
------------------------------------------------------------
Cell Parent Company or Cell Therapeutics, Inc., reported that
total estimated and unaudited net financial standing as of
Feb. 28, 2014, was $39.6 million. The total estimated and
unaudited net financial standing of CTI Consolidated Group as of
Feb. 28, 2014, was $40.1 million.
CTI Parent Company trade payables outstanding for greater than 30
days were approximately $2.2 million as of Feb. 28, 2014. CTI
Consolidated Group trade payables outstanding for greater than 30
days were approximately $2.3 million as of Feb. 28, 2014.
The Company disclosed that during February 2014, there were
solicitations for payment only within the ordinary course of
business and there were no injunctions or suspensions of supply
relationships that affected the course of normal business.
A copy of the press release is available for free at:
http://is.gd/xGRuJ5
About Cell Therapeutics
Headquartered in Seattle, Washington, Cell Therapeutics, Inc.
(NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is
a biopharmaceutical company committed to developing an integrated
portfolio of oncology products aimed at making cancer more
treatable.
The Company's balance sheet at Sept. 30, 2013, showed
$47.23 million in total assets, $33.39 million in total
liabilities, $13.46 million in common stock purchase warrants, and
$387,000 in total shareholders' equity.
Going Concern
The Company's independent registered public accounting firm
included an explanatory paragraph in its reports on the Company's
consolidated financial statements for each of the years ended
Dec. 31, 2007, through Dec. 31, 2011, regarding their substantial
doubt as to the Company's ability to continue as a going concern.
Although the Company's independent registered public accounting
firm removed this going concern explanatory paragraph in its
report on the Company's Dec. 31, 2012, consolidated financial
statements, the Company expects to continue to need to raise
additional financing to fund its operations and satisfy
obligations as they become due.
"The inclusion of a going concern explanatory paragraph in future
years may negatively impact the trading price of our common stock
and make it more difficult, time consuming or expensive to obtain
necessary financing, and we cannot guarantee that we will not
receive such an explanatory paragraph in the future," the Company
said in its quarterly report for the period ended Sept. 30, 2013.
The Company added that it may not be able to maintain its listings
on The NASDAQ Capital Market and the Mercato Telematico Azionario
stock market in Italy, or the MTA, or trading on these exchanges
may otherwise be halted or suspended, which may make it more
difficult for investors to sell shares of the Company's common
stock.
Bankruptcy Warning
"We have acquired or licensed intellectual property from third
parties, including patent applications relating to intellectual
property for pacritinib, PIXUVRI, tosedostat, and brostallicin.
We have also licensed the intellectual property for our drug
delivery technology relating to Opaxio which uses polymers that
are linked to drugs, known as polymer-drug conjugates. Some of
our product development programs depend on our ability to maintain
rights under these licenses. Each licensor has the power to
terminate its agreement with us if we fail to meet our obligations
under these licenses. We may not be able to meet our obligations
under these licenses. If we default under any license agreement,
we may lose our right to market and sell any products based on the
licensed technology and may be forced to cease operations,
liquidate our assets and possibly seek bankruptcy protection.
Bankruptcy may result in the termination of agreements pursuant to
which we license certain intellectual property rights," the
Company said in its Form 10-Q for the period ended Sept. 30, 2013.
CLAIRE'S STORES: Amends Credit Agreement with Credit Suisse
-----------------------------------------------------------
Claire's Stores, Inc., entered into amendment No. 1 to its Amended
and Restated Credit Agreement, dated as of Sept. 20, 2012, among
the Company, Claire's, Inc., the Company's corporate parent,
Credit Suisse AG, as administrative agent, and issuing agent named
therein and the lenders. A copy of the Amendment available for
free at http://is.gd/iyv0OB
Section 6.11 of the Credit Agreement requires the Company to
maintain a Total Net Secured Leverage Ratio (as defined in the
Credit Agreement) not in excess of a specified maximum level when
outstanding borrowings (inclusive of letters of credit under the
Credit Agreement) (a) exceed $15.0 million at the end of a
quarter, or (b) exceed $15.0 million (inclusive of the borrowing
being requested) at the time of a borrowing. The Amendment (i)
provides for a clarification in how the Total Net Secured Leverage
Ratio is calculated at the time of a borrowing, and (ii) increases
the maximum permitted Total Net Secured Leverage Ratio from 5.50
to 1.00 to 6.00 to 1.00.
About Claire's Stores
Claire's Stores, Inc. -- http://www.clairestores.com/-- operates
as a specialty retailer of fashion accessories and jewelry for
preteens and teenagers, as well as for young adults in North
America and internationally. It offers jewelry products that
comprise costume jewelry, earrings, and ear piercing services; and
accessories, including fashion accessories, hair ornaments,
handbags, and novelty items.
Based in Pembroke Pines, Florida, Claire's Stores operates under
two brands: Claire's(R), which operates worldwide and Icing(R),
which operates only in North America. As of Jan. 31, 2009,
Claire's Stores, Inc., operated 2,969 stores in North America and
Europe. Claire's Stores also operates through its subsidiary,
Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint
venture with AEON, Co., Ltd. The Company also franchises 198
stores in the Middle East, Turkey, Russia, South Africa, Poland
and Guatemala.
Claire's Stores disclosed net income of $1.28 million on $1.55
billion of net sales for the fiscal year ended Feb. 2, 2013, as
compared with net income of $11.63 million on $1.49 billion of net
sales for the fiscal year ended Jan. 28, 2012.
The Company's balance sheet at Nov. 2, 2013, showed $2.73 billion
in total assets, $2.81 billion in total liabilities and a $89.32
million stockholders' deficit.
Bankruptcy Warning
The Company said the following statement in its annual report for
the fiscal year ended Feb. 2, 2013.
"If we are unable to generate sufficient cash flow and are
otherwise unable to obtain funds necessary to meet required
payments of principal, premium, if any, and interest on our
indebtedness, or if we otherwise fail to comply with the various
covenants, including financial and operating covenants in the
instruments governing our indebtedness, we could be in default
under the terms of the agreements governing such indebtedness. In
the event of such default:
* the holders of such indebtedness may be able to cause all of
our available cash flow to be used to pay such indebtedness
and, in any event, could elect to declare all the funds
borrowed thereunder to be due and payable, together with
accrued and unpaid interest;
* the lenders under our Credit Facility could elect to
terminate their commitments thereunder, cease making further
loans and institute foreclosure proceedings against our
assets; and
* we could be forced into bankruptcy or liquidation," according
to the Company's annual report for the fiscal year ended
Feb. 2, 2013.
* * *
As reported by the TCR on Oct. 1, 2012, Moody's Investors Service
upgraded Claire's Stores, Inc.'s Corporate Family and Probability
of Default ratings to Caa1 from Caa2. The upgrade of Claire's
Corporate Family Rating to Caa1 reflects its ability to address
its substantial term loan maturity in 2014 by refinancing it with
a $625 million add-on to its existing senior secured first lien
notes due 2019.
Claire's Stores, Inc., carries a 'B-' corporate credit rating from
Standard & Poor's Ratings Services.
CLAREMONT PLAZA: Case Summary & Unsecured Creditor
--------------------------------------------------
Debtor: Claremont Plaza LLC
760 Cedar Avenue
San Bruno, CA 94066
Case No.: 14-30701
Chapter 11 Petition Date: May 5, 2014
Court: United States Bankruptcy Court
Northern District of California (San Francisco)
Judge: Hon. Hannah L. Blumenstiel
Debtor's Counsel: Anthony C. Hughes, Esq.
ANTHONY FINANCIAL LAW
1395 Garden Highway #150
Sacramento, CA 95833
Tel: (916) 440-6666
Email: attorney@4406666.com
Total Assets: $1.40 million
Total Liabilities: $1.05 million
The petition was signed by Melanie Nievera Dhillon, managing
member.
The Debtor listed Greenberg, Grant & Richards, Inc., as its
largest unsecured creditor holding a claim of $3,975.
CNO FINANCIAL: Fitch Raises Issuer Default Rating to 'BB+'
----------------------------------------------------------
Fitch Ratings has upgraded CNO Financial Group Inc.'s (CNO
Financial) Issuer Default Rating (IDR) to 'BB+' from 'BB' and all
its securities by one-notch. Fitch has affirmed the Insurer
Financial Strength (IFS) ratings of CNO's core insurance
subsidiaries at 'BBB'. The Rating Outlook is Positive for all
ratings.
Concurrently, Fitch has maintained the 'BB+' IFS on Rating Watch
Positive for Conseco Life Insurance Company (Conseco Life). A full
list of rating actions follows at the end of this release.
Key Rating Drivers
The CNO Financial upgrade reflects a move to normal notching
between holding company and insurance operating subsidiary ratings
per Fitch's rating criteria. Favorable operating performance and
improved capitalization have increased the cushion in key debt
covenants and thus enhanced the company's financial flexibility.
Fitch's Positive Outlook on all ratings is driven by CNO
Financial's increased profitability and fixed charge coverage as
well as lower expected earnings volatility. Successful completion
of the pending Conseco Life divestiture is also viewed favorably.
CNO Financial's profitability rebounded in 2013 to a double digit
ROE of 11.9% and operating return on assets (ROA) improved to 79
basis points (bps). Operating results are more stable for the
largest operating companies, Bankers Life and Casualty Company
(Bankers Life) and Washington National Life Insurance Company,
benefiting from strong annuity, Medicare supplement and
supplemental health margins. Going forward, operating
profitability and stability is expected to benefit from CNO
Financial's disposal of the large majority of underperforming
interest-sensitive life insurance and long-term care (LTC)
insurance, reported in the OCB GAAP segment previously.
Fitch views CNO Financial's statutory capitalization as strong and
financial leverage as moderate. Consolidated RBC ratio improved
to 427% at March 31, 2014, after increasing to 410% at yearend
2013 from 367% at yearend 2012. The company's financial leverage
was 17.6% at March 31, 2014 with the booking of the $298 million
loss on the sale of Conseco Life after declining to 16.9% at year-
end 2013 and from 21% for Dec. 31, 2012.
CNO Financial's debt service capabilities measured by GAAP based
interest coverage improved to 6.3x for 2013 versus 2.1x for full-
year 2012. Fitch expects fixed charge coverage to range from 6-8x
excluding unusual items for 2014.
CNO Financial's overall bond quality is good, with approximately
13% of bonds below investment grade at Dec. 31, 2013 on a GAAP
basis. However, the investment-grade bond portfolio is dominated
by 'BBB' level rated securities at 48% of the portfolio making it
potentially more vulnerable in a declining economic scenario to
downgrade risk. CNO Financial has low exposure to directly placed
commercial mortgages and alternative assets.
Conseco Life remains on Rating Watch Positive pending the close of
its sale to Wilton Re.
Rating Sensitivities:
Key rating triggers that could lead to an upgrade for all ratings
include:
-- Continued generation of stable earnings free of significant
special charges;
-- GAAP interest coverage ratio above 6x;
-- NAIC risk based capital (RBC) ratio above 350%;
-- Close of Conseco Life sale at expected terms.
Key rating triggers that could lead to a return to stable outlook
or downgrade include:
-- Combined NAIC RBC ratio less than 300% and operating leverage
above 20x;
-- Deterioration in operating results;
-- Failure to close the Conseco Life sale
-- Significant increase in credit-related impairments;
-- Financial leverage above 30%
Fitch expects that over the next few years, CNO Financial will
attempt to migrate its capital structure away from secured senior
debt to unsecured senior debt. During this transition, the mix of
secured versus unsecured debt may fluctuate. Fitch would expect
to narrow the notching of CNO Financial's unsecured debt relative
to the IDR as the mix in secured debt declines below 25%.
Currently, CNO Financial's senior unsecured debt is one notch
lower than standard due to the large level of secured debt in the
capital structure.
Rating Sensitivities For Conseco Life Insurance Company:
Fitch would upgrade the IFS rating of Conseco Life following the
close of the transaction with the final rating based upon its
evaluation of Conseco Life's capitalization, strategic importance
to Wilton Re and degree of support.
Fitch could affirm the current 'BB+' IFS rating or reevaluate if
the transaction fails to close.
Fitch has upgraded the following ratings:
CNO Financial Group, Inc.
-- IDR upgraded to 'BB+' from 'BB';
-- $4 million 7% senior unsecured convertible note due Dec. 30,
2016 upgraded to 'BB-' from 'B+';
-- Senior secured bank credit facility (tranches of $250 million
and $425 million due Sept. 30, 2016 and 2018, respectively)
upgraded to 'BB+' from 'BB';
-- $275 million senior secured note 6.375% due Oct. 1, 2020
upgraded to 'BB+' from 'BB'.
The Rating Outlook is Positive.
Fitch has affirmed the following ratings:
Bankers Life and Casualty Company
Bankers Conseco Life Insurance Company
Colonial Penn Life Insurance Company
Washington National Insurance Company
-- IFS at 'BBB'.
The Rating Outlook is revised to Positive from Stable.
Fitch maintained the Rating Watch Positive on the following
rating:
Conseco Life Insurance Company
-- Insurer Financial Strength 'BB+'.
CROWN MEDIA: Posts $12 Million Net Income in First Quarter
----------------------------------------------------------
Crown Media Holdings, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income and comprehensive income of $12.03 million on $90.67
million of net total revenue for the three months ended March 31,
2014, as compared with net income and comprehensive income of
$14.53 million on $85.56 million of net total revenue for the same
period last year.
As of March 31, 2014, the Company had $1.03 billion in total
assets, $624.99 million in total liabilities and $411.17 million
in total stockholders' equity.
"Building on the success of our first original series Cedar Cove,
we introduced our second original series When Calls the Heart in
January 2014 to the delight of our loyal viewers. We snagged
their hearts with the Kitten Bowl in February 2014," said Bill
Abbott, president and CEO of Crown Media Family Networks. "With a
slate of 15 original movie premiers in 2014, the return of
Countdown to Christmas with 12 Original Movies and The Most
Wonderful Movies of Christmas, and the realignment of the Hallmark
Movie Channel's brand with a new name, tagline and logo called
Hallmark Movies & Mysteries; we have positioned ourselves to meet
our strategic goals."
Adjusted EBITDA was $36.2 million for the first quarter of 2013
compared to $31.3 million for the first quarter of 2014. Cash
used in operating activities totaled $6 million for the first
quarter of 2013 compared to cash provided by operating activities
of $4.6 million for the first quarter of 2014. Net income to
common shareholders for the quarter ended March 31, 2013, totaled
$14.5 million, or $0.04 per share, compared to $12 million, or
$0.03 per share, in the first quarter of 2014.
A copy of the Form 10-Q is available for free at:
http://is.gd/hfTJYF
About Crown Media
Studio City, Calif.-based Crown Media Holdings, Inc. (NASDAQ:
CRWN) -- http://www.hallmarkchannel.com/-- owns and operates
cable television channels dedicated to high quality, broad appeal,
entertainment programming. The Company currently operates and
distributes Hallmark Channel in both high definition (HD) and
standard definition (SD) to 90 million subscribers in the U.S.
Crown Media also operates a second 24-hour linear channel,
Hallmark Movie Channel, available in both HD and SD, which focuses
on family-friendly movies with a mix of classic theatrical films,
presentations from the acclaimed Hallmark Hall of Fame library,
original Hallmark Channel movies and special events.
Crown Media reported net income attributable to common
stockholders of $67.71 million on $377.80 million of net total
revenue for the year ended Dec. 31, 2013, as compared with net
income attributable to common stockholders of $107.35 million on
$349.87 million of net total revenue for the year ended Dec. 31,
2012.
Bankruptcy Warning
"Our senior secured credit facilities and the indenture governing
the Notes contain a number of covenants that impose significant
operating and financial restrictions on us which, among other
things, limit our ability to do the following:
* incur additional debt or issue certain preferred shares;
* pay dividends on or make distributions in respect of our
capital stock or make other restricted payments;
* make certain payments on debt that is subordinated or secured
on a junior basis;
* make certain investments;
* sell certain assets;
* create liens on certain assets;
* consolidate, merge, sell or otherwise dispose of all or
substantially all of our assets;
* enter into certain transactions with our affiliates; and
* designate our subsidiaries as unrestricted subsidiaries.
Any of these restrictions could limit our ability to plan for or
react to market conditions and could otherwise restrict corporate
activities. Any failure to comply with these covenants could
result in a default under our senior secured credit facilities and
the indenture governing the Notes. Upon a default, unless waived,
the lenders under our senior secured credit facilities could elect
to terminate their commitments, cease making further loans,
foreclose on our assets pledged to such lenders to secure our
obligations under the senior secured credit facilities and force
us into bankruptcy or liquidation. Holders of the Notes would also
have the ability ultimately to force us into bankruptcy or
liquidation, subject to the indenture governing the Notes," the
Company said in the Annual Report for the year ended Dec. 31,
2013.
* * *
As reported by the TCR on May 28, 2012, Standard & Poor's Ratings
Services raised its corporate credit rating on Studio City,
Calif.-based cable network company Crown Media Holdings Inc. to
'B+' from 'B'. "The upgrade reflects Crown Media's recent
operating performance, which achieved higher EBITDA and lower
leverage than our expectations," said Standard & Poor's credit
analyst Deborah Kinzer.
Crown Media carries a B2 Corporate Family Rating from Moody's
Investors Service. Crown Media's B2 CFR reflects the company's
small size and niche market position among cable network
operators, concentration in two Hallmark-branded channels,
reliance on licensed third party content for a majority of its
programming, and high leverage.
DORAL FINANCIAL: Fitch Cuts Issuer Default Rating to 'C'
--------------------------------------------------------
Fitch Ratings has downgraded Doral Financial Corp.'s (DRL) Issuer
Default Rating (IDR) to 'C' from 'CCC' and Viability Rating (VR)
to 'c' from 'ccc', respectively. Long-term IDRs of 'C' and VRs of
'c' indicate that default appears imminent or inevitable.
Key Rating Drivers - IDRs, VR and Senior Debt
DRL's downgrade follows the company's recent announcements that it
will not meet the minimum capital requirements outlined in the
company's current Consent Order and Written Agreements with
regulators. Further, Fitch believes that DRL's liquidity position
may be pressured since the company also announced that the Federal
Deposit Insurance Corporation (FDIC) would no longer consider
granting certain waivers that allowed the company to continue the
use of brokered deposits for funding until DRL submits a revised
capital calculation plan.
On May 1, 2014, the company was advised by the FDIC and Office of
Financial Commissions (the local Puerto Rico bank regulator) that
it could no longer include some or all of certain tax receivables
due from the Government of Puerto Rico as part of its Tier 1
capital calculation. The tax receivables, which total $289
million, account for roughly 43% of DRL's current Tier 1 capital
($679 million). Given the exclusion of these receivables, DRL is
no longer in compliance with its minimum regulatory capital
requirement. The regulatory order requires Doral Bank to maintain
a minimum Leverage Ratio of 8%, Tier 1 RBC of 10% and Total RBC of
12%.
Furthermore, in the consent order, Doral Bank is not permitted to
accept, renew or rollover any brokered deposits unless a waiver is
granted by the FDIC. The FDIC had previously granted such
waivers. As of Dec. 31, 2013, DRL had a total of $1.4 billion in
brokered deposits accounting for 28% of total deposits and 18% of
total funding.
Given these changed circumstances, Fitch believes that it is
unlikely that DRL would be able to address the capital shortfall
in a timely manner. Moreover, the inability to access the
brokered deposit market will further pressure DRL's weak funding
profile. DRL's ratings have incorporated many of the company's on-
going challenges such as longer-term strategic plans, geographic
and product concentration in Puerto Rico with a limited franchise,
high levels of non-performers, weak capital and liquidity profile.
This development further adds to these already significant issues.
Fitch had previously assigned a recovery rating to DRL's uninsured
deposits, in accordance with its 'Recovery Ratings for Financial
Institutions Criteria', however, in light of DRL's changed
circumstances, Fitch does not believe it has adequate information
on which to base a recovery analysis. In the event information
becomes available, Fitch will assess potential recovery.
Key Rating Sensitivities - IDRs, Senior Debt and VR
DRL's ratings are the lowest rating category. In previous ratings
actions Fitch noted that the company's ratings are highly
sensitive to compliance with its regulatory agreement.
Additionally, DRL's ratings remain sensitive to its ability to
access funding markets.
Key Rating Drivers and Sensitivities - Long- And Short-Term
Deposit Ratings
DRL's uninsured deposit ratings are rated one notch higher than
the company's IDR and senior unsecured debt because U.S. uninsured
deposits benefit from depositor preference. U.S. depositor
preference gives deposit liabilities superior recovery prospects
in the event of default.
The ratings of long and short-term deposits issued by DRL and its
subsidiary are primarily sensitive to any change in DRL's IDR.
Key Rating Drivers and Sensitivities - Support and Support Rating
Floors
DRL has a Support Rating of '5' and Support Rating Floor of 'NF'.
In Fitch's view, DRL is not systemically important and therefore,
Fitch believes the probability of support is unlikely. IDRs and
VRs do not incorporate any support.
Rating Drivers and Sensitivities - Holding Company
DRL has a bank holding company (BHC) structure with the bank as
the main subsidiary. The subsidiary is considered core to the
parent holding company supporting equalized ratings between the
bank subsidiary and the BHC. IDRs and VRs are equalized with
those of DRL's operating company and bank reflecting its role as
the bank holding company, which is mandated in the U.S. to act as
a source of strength for its bank subsidiaries.
Fitch has downgraded the following ratings:
Doral Financial Corporation
-- Long-term IDR to 'C' from 'CCC';
-- Viability rating to 'c' from 'ccc'.
Doral Bank
-- Long-term IDR to 'C' from 'CCC';
-- Long-term deposits to 'CC' from 'B-/RR3';
-- Viability rating to 'c' from 'ccc'.
Fitch has affirmed the following ratings:
Doral Financial Corporation
-- Preferred stock at 'C/RR6';
-- Senior debt at 'C/RR6';
-- Short-term IDR at 'C';
-- Support at '5';
-- Support Floor at 'NF';
Doral Bank
-- Short-term IDR at 'C';
-- Short-term deposit at 'C'.
-- Support at '5';
-- Support Floor at 'NF'.
DOUG RICH: Wins Court Approval to Abandon Real Property
-------------------------------------------------------
Bankruptcy Judge R. Kimball Mosier granted Doug Rich's motion for
an order directing the Chapter 7 Trustee to abandon certain real
property. There is no material dispute that the real property has
no equity for the benefit of unsecured creditors and the Trustee
is not administering the real property for the benefit of
unsecured creditors so the Court will order the Trustee to abandon
the real property.
Doug Rich filed for Chapter 11 bankruptcy (Bankr. D. Utah Case No.
10-21536) on Feb. 15, 2010. The Court on Oct. 12, 2011, granted
the Debtor's voluntary motion to convert the case to one under
chapter 7 and Stephen W. Rupp was appointed as the Chapter 7
trustee.
On April 19, 2012, the Debtor was issued a discharge. On May 10,
2012, the Court entered an order approving a settlement agreement
between the Debtor and the Trustee. The settlement agreement
resolved several disputes between the Debtor and the Trustee,
including the Trustee's claim that the Debtor had made
unauthorized post petition transfers. The settlement agreement
resolved and released all claims between the Trustee and the
Debtor.
On Feb. 12, 2013, U.S. Bank National Association filed a motion
seeking relief from the automatic stay with respect to real
property located at 263 N 3050 West, Layton, Utah 84041. Notice
of the Bank's relief from stay motion and hearing was given to the
Debtor, Debtor's counsel and to the Trustee. There were no
objections filed in response to the Bank's motion for relief from
the automatic stay and the Court granted the Bank's motion,
thereby terminating the automatic stay as to the Real Property.
On April 3, 2014, the Debtor filed his Motion to Abandon Real
Property. Notice of the Debtor's Motion to Abandon was sent to all
creditors and parties-in-interest. The Debtor's Motion to Abandon
states that the Debtor has negotiated a short sale of the Real
Property with the consent of the secured creditor. The motion
states that the debt secured by the Real Property totals
$520,451.38, that the Real Property is scheduled to be sold at a
trustee's foreclosure sale on April 17, 2014, that the proposed
short sale is between the Debtor and Nelson Hansen, the proposed
purchase price at the short sale is $335,000, and that the Debtor
will not receive any proceeds from the sale. The Debtor argues
that the Real Property has no equity and therefore has no value to
the estate.
The Debtor's Motion to Abandon was met with two objections. The
first objection, filed by Michael W. and Gayle R. Allred questions
the reliability of the Debtor's representations and questions
whether the Debtor has been candid with the Court at all times.
The Allreds failed to appear at the hearing on the Debtor's Motion
to Abandon and their objection does not address the merits of the
Debtor's motion and the Court will therefore overrule the Allred's
objection.
The second objection was filed by the Trustee arguing that the
Debtor's motion for abandonment is the equivalent of a motion for
approval of sale of the Real Property by the Debtor -- something
that is beyond the standing or authority of the Debtor. The
Trustee trivializes his failure to object to the Bank's motion for
relief from stay and argues that the Debtor's failure to provide
an appraisal or valuation of the property should be fatal to the
Debtor's motion. The Trustee also argues that the Debtor has, both
before and after the filing of his Chapter 11 bankruptcy petition,
engaged in a pattern of fraudulently transferring, or transferring
without authority, the value, possession and enjoyment of the Real
Property to another. The Trustee argues that the Debtor's motion
fails to explain how he will compensate the estate for his
participation in the fraudulent and unauthorized transfer of the
value of this property both prior to and during the pendency of
his bankruptcy case, and that the request for abandonment is an
attempt to curtail or deter the rights and claims of the
bankruptcy estate, and in particular those rights and claims
arising from the continuing fraudulent and unauthorized post-
petition transfer of the Real Property. The Trustee also argues
that the Debtor should have negotiated harder in an effort to
increase the purchase price and provide a carve out for the
benefit of the bankruptcy estate.
In granting the request, Judge Mosier held that, "The Trustee has
had since November of 2011 to administer the Real Property which
is an asset of this estate. There is no evidence in the docket
that the Trustee has attempted to market the Real Property by
employing the services of a real estate professional or appraiser,
nor does the Trustee allege in his objection that he is attempting
to sell, or intends to sell the Real Property sometime in the
future. Importantly, the Trustee does not allege that there is
equity or even the possibility of equity in the Real Property.
Accordingly, the Court finds that the Real Property is burdensome
to the estate and is of inconsequential value to the estate and
the Debtor's motion to abandon the Real Property shall be
granted."
A copy of the Court's May 2, 2014 Memorandum Opinion is available
at http://is.gd/eknm3Ufrom Leagle.com.
DUNE ENERGY: Incurs $2.5 Million Net Loss in First Quarter
----------------------------------------------------------
Dune Energy, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $2.49 million on $11.98 million of total revenues for the three
months ended March 31, 2014, as compared with a net loss of $3.21
million on $13.08 million of total revenues for the same period in
2013.
As of March 31, 2014, the Company had $259.73 million in total
assets, $138.79 million in total liabilities and $120.94 million
in total stockholders' equity.
A copy of the Form 10-Q is available for free at:
http://is.gd/PjXqqT
About Dune Energy
Dune Energy, Inc. (NYSE AMEX: DNE) -- http://www.duneenergy.com/
-- is an independent energy company based in Houston, Texas.
Since May 2004, the Company has been engaged in the exploration,
development, acquisition and exploitation of natural gas and crude
oil properties, with interests along the Louisiana/Texas Gulf
Coast. The Company's properties cover over 90,000 gross acres
across 27 producing oil and natural gas fields.
Dune Energy reported a net loss of $46.98 million in 2013, a net
loss of $7.85 million in 2012 and a net loss of $60.41 million in
2011.
EDGENET INC: Bid to Disband Noteholders' Committee Denied
---------------------------------------------------------
Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware, for reasons stated in open court, denied
Edgenet Inc., et al.'s motion to disband the official committee of
noteholders.
As previously reported by The Troubled Company Reporter, the U.S.
Trustee appointed a five-member official committee of noteholders,
composed of holders owed $18.5 million from notes issued in 2004.
The Debtors sought the disbandment of the committee, arguing that
the interest of the the noteholders' committee is unwarranted
because the committee is not necessary to protect the noteholders'
interest, which are already protected by Ernest Wu, the fiduciary
contractually vested with the obligation to protect their
interests as their attorney-in-fact.
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reported that Edgenet's reorganization will determine the standard
by which a bankruptcy judge can disband an official committee
formed by the U.S. Trustee. Mr. Rochelle related that the U.S.
Trustee has argued in her opposition papers that the judge can?t
substitute his judgment for the U.S. Trustee?s on the decision to
appoint a committee. The U.S. Trustee and the noteholders both
contend that the judge can set aside a committee appointment only
if he finds that the U.S. Trustee abused her discretion in forming
an official committee, the Bloomberg report related.
About Edgenet Inc.
Edgenet, Inc., and Edgenet Holding Corp. are providers of cloud-
based content and applications that enable companies to sell more
products and services with greater ease across multiple channels
and devices. Edgenet has three business locations: Waukesha, WI,
Brentwood, TN, and its main office in Atlanta, GA. The Company
has 80 employees.
Edgenet Inc. and Edgenet Holding filed for Chapter 11 bankruptcy
protection in Delaware (Lead Case No. 14-10066) on Jan. 14, 2014.
Edgenet Inc. estimated assets of at least $10 million and
liabilities of $100 million to $500 million.
Raymond Howard Lemisch, Esq., at Klehr Harrison Harvey Branzburg
LLP, in Wilmington, Delaware, serves as counsel to the Debtors;
Glass Ratner Advisory & Capital Group LLC is the financial
advisor; JMP Securities, LLC, is the investment banker, and Phase
Eleven Consultants, LLC, is the claims and noticing agent.
The U.S. Trustee has been unable to appoint an official unsecured
creditors committee as no sufficient interest has been generated
from creditors.
Fred Marxer, Timothy Choate and Davis Carr, individuals and
holders of a segment of the promissory notes issued in 2004 that
have been referred to by Edgenet, Inc., et al., requested that the
Court will issue an order appointing an official committee of
Seller Noteholders, or in the alternative, an official committee
of unsecured creditors, with members appointed from the Seller
Noteholders who agree to waive any continued security interest
arising from the Seller Notes.
EGPI FIRECREEK: Four Directors Elected to Board
-----------------------------------------------
By majority consent of the EGPI Firecreek, Inc., shareholders,
four members were elected to the Company's Board of Directors
Effective March 24, 2014. The Directors will hold their
respective office until the Company's Annual Meeting of
Shareholders in 2015 or until their successors are duly elected
and qualified. The members of the Company's Board of Directors
are Dennis R. Alexander, Michael Trapp, Michael D. Brown and David
Taylor.
Dennis R. Alexander has served as Chairman, CEO, and chief
financial officer of the Company since May 21, 2009, having served
as chairman, president and chief financial officer of EGPI and
Firecreek Petroleum, Inc., since Feb. 10, 2007. He served as
Chairman and chief financial officer of EGPI and Firecreek
Petroleum, Inc., since July 1, 2004, through Feb. 9, 2007, having
served as the president and director of EGPI from May 18, 1999, to
June 30, 2004. In September 1998 he was a founder, and from
Jan. 19, 1999, through its acquisition with EGPI served as
president and director of Energy Producers Group, Inc. From April
1997 through March 1998, served as CEO, director, consultant of
Miner Communications, Inc., a media communications company. From
April 26, 1997 through March, 1998 he was a director of Rockline,
Inc., a private mining, resource company, and a founder of World
Wide Bio Med, Inc., a private health-bio care, start up company.
Since March 1996 to the present he has owned Global Media Network
USA, Inc., which has included management consulting, advisory
services. Mr. Alexander devotes approximately 60 to 80 hours per
week minimum, and more as required, to the business of EGPI.
Michael Trapp has served as a director of the Company since
May 21, 2009, having been appointed as a director of EGPI on
Dec. 3, 2008. A graduate of Rice Aviation he earned honors and
honed his skills as a Airframe and Power Plant licensee working in
the airline industry for many years. He recently owned his own
mortgage company and is now a senior loan officer for a multi-
state lender in Mesa, Arizona. His strong technical and
analytical skills will be a bonus in analyzing prospective
projects which will enhance EGPI's growth and asset base.
David Taylor has served as a director of the Company since
Sept. 16, 2010. He is presently the president of Caddo
International, Inc (fka Petrol Industries Inc) an oilfield service
company in Oil City Louisiana. Caddo provides operations for work
over rigs and other oil field service equipment to work over wells
located in the Caddo Pine Island Field and additionally maintains
and oversees leases for owners. Caddo employs approximately 20
people. Mr. Taylor is also president of Chanwest Resources Inc.,
a wholly owned subsidiary of EGPI Firecreek, Inc. CWR is an
oilfield construction service company which operates in east Texas
and North West Louisiana. Over the years Mr. Taylor has been a
consultant through Willoil Consulting, LLC, to several companies
in Northeast Louisiana and East Texas dealing with day to day
operations and Management issues in the Oil and Gas Industry. In
addition Mr. Taylor has been a professional accountant in the Oil
and Gas Industry for 40 years with services provided is several
States in the US including Indiana, Illinois, Oklahoma. Kansas,
Texas, California and Louisiana. He has been an officer and
director of several public companies in the natural resource field
providing. Mr. Taylors experience includes assisting turnaround
situations in the oil and gas industry, and mergers and
acquisitions in the public and private sector. Mr. Taylor is a
resident of Shreveport, Louisiana.
Michael D. Brown was appointed to the Board of Directors of the
Company on July 6, 2009. Mr. Brown was nominated by president
George W. Bush as the first Under Secretary of Emergency
Preparedness and Response (EP&R) in the newly created Department
of Homeland Security in January 2003. Mr. Brown coordinated
federal disaster relief activities including implementation of the
Federal Response Plan, which authorized the response and recovery
operations of 26 federal agencies and departments as well as the
American Red Cross. Mr. Brown also provided oversight of the
National Flood Insurance Program and the U.S. Fire Administration
and initiated proactive mitigation activities. Prior to joining
the Federal Emergency Management Agency, Mr. Brown practiced law
in Colorado and Oklahoma, where he served as a Bar Examiner on
Ethics and Professional Responsibility for the Oklahoma Supreme
Court and as a Hearing Examiner for the Colorado Supreme Court.
Mr. Brown had been appointed as a Special Prosecutor in police
disciplinary matters. While attending law school, Mr. Brown was
appointed by the Chairman of the Senate Finance Committee of the
Oklahoma Legislature as the Finance Committee Staff Director,
where he oversaw state fiscal issues. Mr. Brown's background in
state and local government also includes serving as an Assistant
City Manager with Emergency Services Oversight and as a City
Councilman. Mr. Brown holds a B.A. in Public
Administration/Political Science from Central State University,
Oklahoma. Mr. Brown received his J.D. from Oklahoma City
University's School of Law. He was an Adjunct Professor of Law
for Oklahoma City University.
Effective March 24, 2014, by majority consent of the EGPI
Firecreek, Inc., directors of record at March 24, 2013, three
persons were elected as officers of the Company. The Officers
will hold their respective office until the Company's Annual
Meeting of Directors in 2015 or until their successors are duly
elected and qualified. The Officers of the Company are as
follows:
Position
Name Position Held Since
---- ---------------- ----------
Dennis R. Alexander CEO, Pres. & CFO 1999
Michael Trapp Exec. Vice Pres. 2008
Deborah L. Alexander Sec. & Tresurer 2013
Effective March 24, 2014, the Board of Directors of the Company
reconfirmed certain changes to certain committees: The Audit
Committee and a combined Nominating and Compensation and Stock
Option Committee.
The Audit Committee consists of the following:
(1) The Audit Committee is composed initially of two members: Ms.
Joanne Sylvanus, its Chairman, and Dennis Alexander,
member.
(2) The combined Nomination and the Compensation and Stock Option
Committee are composed initially of three members: Mr. Mike
Trapp, David Taylor, and Dennis Alexander, members.
A full-text copy of the Form 8-K is available for free at:
http://is.gd/2gUq7W
About EGPI Firecreek
Scottsdale, Ariz.-based EGPI Firecreek, Inc. (OTC BB: EFIR) was
formerly known as Energy Producers, Inc., an oil and gas
production company focusing on the recovery and development of oil
and natural gas.
The Company has been focused on oil and gas activities for
development of interests held that were acquired in Texas and
Wyoming for the production of oil and natural gas through Dec. 2,
2008. Historically in its 2005 fiscal year, the Company initiated
a program to review domestic oil and gas prospects and targets.
As a result, EGPI acquired non-operating oil and gas interests in
a project titled Ten Mile Draw located in Sweetwater County,
Wyoming for the development and production of natural gas. In
July 2007, the Company acquired and began production of oil at the
2,000 plus acre Fant Ranch Unit in Knox County, Texas. This was
followed by the acquisition and commencement in March 2008 of oil
and gas production at the J.B. Tubb Leasehold Estate located in
the Amoco Crawar Field in Ward County, Texas.
EGPI Firecreek disclosed a net loss of $6.08 million on $124,157
of total revenue for the year ended Dec. 31, 2012, as compared
with a net loss of $4.97 million on $293,712 of total revenue for
the year ended Dec. 31, 2011. The Company's balance sheet at
March 31, 2013, showed $1.31 million in total assets, $6.92
million in total liabilities, all current, $1.86 million in series
D preferred stock, and a $7.48 million total shareholders'
deficit.
M&K CPAS, PLLC, issued a "going concern" qualification on the
consolidated financial statements for the year ended Dec. 31,
2012. The independent auditors noted that he Company has suffered
recurring losses and negative cash flows from operations that
raise substantial doubt about its ability to continue as a going
concern.
ELITE PHARMACEUTICALS: Amends 108MM Shares Resale Prospectus
------------------------------------------------------------
Elite Pharmaceuticals Inc. amended its Form S-1 registration
statement relating to the offer and sale of up to 108,000,000
shares of common stock, par value $0.001, of the Company by
Lincoln Park Capital Fund, LLC. The Company amended the
Registration Statement to delay its effective date.
The shares of common stock being offered by the selling
shareholder have been or may be issued pursuant to a purchase
agreement dated April 10, 2014, that the Company entered into with
Lincoln Park. The prices at which Lincoln Park may sell the
shares will be determined by the prevailing market price for the
shares or in negotiated transactions.
The Company is not selling any securities under this prospectus
and will not receive any of the proceeds from the sale of shares
by Lincoln Park.
The Company will pay the expenses incurred in registering the
shares, including legal and accounting fees.
The Company's common stock is currently quoted on the Over-the-
Counter Bulletin Board, or the OTCBB, under the symbol "ELTP". On
April 22, 2014, the last reported sale price of the Company's
common stock on the OTCBB was $0.39.
A copy of the Form S-1/A is available for free at:
http://is.gd/QAzyzq
About Elite Pharmaceuticals
Northvale, New Jersey-based Elite Pharmaceuticals, Inc., is a
specialty pharmaceutical company principally engaged in the
development and manufacture of oral, controlled-release products,
using proprietary technology and the development and manufacture
of generic pharmaceuticals. The Company has one product,
Phentermine 37.5mg tablets, currently being sold commercially.
Elite Pharmaceuticals reported net income attributable to common
shareholders of $1.48 million on $3.40 million of total revenues
for the year ended March 31, 2013, as compared with a net loss
attributable to common shareholders of $15.05 million on $2.42
million of total revenues for the year ended March 31, 2012.
The Company's balance sheet at Dec. 31, 2013, showed $18.27
million in total assets, $23.20 million in total liabilities and a
$4.92 million total stockholders' deficit.
Demetrius Berkower LLC, in Wayne, New Jersey, issued a "going
concern" qualification on the consolidated financial statements
for the year ended March 31, 2013. The independent auditors noted
that the Company has experienced significant losses resulting in a
working capital deficiency and shareholders' deficit. These
conditions raise substantial doubt about its ability to continue
as a going concern.
ELBIT IMAGING: Talks on Possible Purchase of Gamida Terminated
--------------------------------------------------------------
Gamida Cell Ltd., in which Elbit Medical Technologies Ltd. holds
approximately 30.8 percent of the voting power, has notified Elbit
Medical that the negotiations of a possible purchase of Gamida
Cell by a global pharmaceutical company have been terminated.
Elbit Imaging Ltd., Elbit Medical and Gamida Cell said they are
evaluating the consequences of the matter.
Elbit Medical is a subsidiary of Elbit Imaging in which the
Company holds approximately 86 percent of the voting power.
Elbit Imaging's annual report on Form 20-F for the year ended
Dec. 31, 2013, as filed with the U.S. Securities and Exchange
Commission on April 30, 2014, is available through its Web site
at: www.elbitimaging.com under: "Investor Relations - Financial
Reports - 2014 - 20F/Form 2013". Shareholders may receive a hard
copy of the annual report free of charge upon request. A full-
text copy of the Form 20-F is available at:
http://www.elbitimaging.com/74978.html
Debt Restructuring Plan
Elbit Imaging announced on March 29, 2014, that its subsidiary,
Plaza Centers N.V. has agreed, based on comments and input
provided by Hermetic and Reznik, Paz & Nevo, the trustees of the
Israeli Series A and Series B Notes, respectively, to make certain
commercial amendments to the debt restructuring plan that will be
submitted to the competent court in the Netherlands in the near
future and, immediately thereafter, published on the Plaza's Web
site.
Plaza clarified that, although the Trustees support the Amended
Plan, they are not in a position to bind the noteholders and
actual approval of the Amended Plan and its terms remains subject
to the creditors' voting, which is scheduled to be held on
June 26, 2014, at 10:00 am CET, in the Herzberg Hall of the
District Court of Amsterdam.
Plaza provided a general, high-level and non-exhaustive brief
summary of the material agreed-upon commercial terms as listed
below:
* The Amended Plan will be contingent upon the injection of a
fresh ^20 million into Plaza, and will become effective only
once the placing of the Equity Contribution will have been
occurred.
* Plaza will issue to holders of unsecured debt 13.5 percent of
the Plaza's shares (post the Equity Contribution) for no
consideration. That issuance of shares will be distributed
among the holders of Unsecured Debt pro rata to the relative
share of each relevant creditor in the Deferred Debt.
* All principal payments due during the years 2013-2015 of any
Unsecured Debt will be deferred for three years from the date
of approval of the Amended Plan by the court in the
Netherlands. If within two years from the Approval Date
Plaza manages to repay 50 percent of the Unsecured Debt, then
the remaining principal payments will be deferred for an
additional one year.
* Interest payments for the Unsecured Debt that were due during
the suspension of payments period, will be added to the
principal and paid together with it. Following the removal
of the suspension of payments order, interest payments will
be paid on their due dates.
* As of Jan. 1, 2014, the annual interest rate of the Unsecured
Debt will be increased by 1.5 percent.
* Following the Effective Date, Plaza will pay to the holders
of the Unsecured Debt an amount of ^10.5 million on account
of 2014 interest payments.
* Plaza, its directors and officers and the Company will be
fully released from claims.
* Following the Effective Date, Plaza will have to assign 75
percent of the net proceeds received from the sale or
refinancing of any of its assets to early repayment of the
Unsecured Debt, to be allocated among the holders of
Unsecured Debt in accordance with the Deferred Debt Ratio.
* Plaza will be allowed to execute actual investments only if
the Plaza's cash reserves contain an amount equal to general
and administrative expenses and interest payments for the
Unsecured Debt for a six-month period (for this purpose also
receivables with a high probability of being collected in the
subsequent six-month period will be taken in account for the
required minimal cash reserve).
The Amended Plan will also include, inter alia: (i) certain
limitations on distribution of dividends and incurring of new
indebtedness; (ii) negative pledge on direct and indirect holdings
of Plaza's on real estate assets; (iii) financial covenants and
undertakings of Plaza with respect to the sale and financing of
certain projects and investment in new projects; and (iv)
commitment to publish quarterly financial statements as long as
the Unsecured Debt is outstanding.
Plaza also noted that the Amended Plan is yet to be finalized,
therefore the above only provides a summary of the key material
points without going into specific details. Plaza intends to
provide details of the Amended Plan, once submitted to the Dutch
court, on Plaza's Web site under Investor relations/ Debt
restructuring:
http://www.plazacenters.com/index.php?p=debt_restructuring.
About Elbit Imaging Ltd.
Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF)
hold investments in real estate and medical companies. The
Company, through its subsidiaries, also develops shopping and
entertainment centers in Central Europe and invests in and manages
hotels.
Elbit Imaging disclosed a loss of NIS455.50 million on NIS671.08
million of total revenues for the year ended Dec. 31, 2012, as
compared with a loss of NIS247.02 million on NIS586.90 million of
total revenues for the year ended Dec. 31, 2011.
Brightman Almagor Zohar & Co., in Tel-Aviv, Israel, expressed
substantial doubt about Elbit Imaging's ability to continue as a
going concern following the financial results for the year ended
Dec. 31, 2012.
The Certified Public Accountants noted that in the period
commencing Feb. 1, 2013, through Feb. 1, 2014, the Company is to
repay its debenture holders NIS 599 million (principal and
interest). "Said amount includes NIS 82 million originally
payable on Feb. 21, 2013, that its repayment was suspended
following a resolution of the Company's Board of Directors. The
Company's Board also resolved to suspend any interest payments
relating to all the Company's debentures. In addition, as of
Dec. 31, 2012, the Company failed to comply with certain financial
covenants relating to bank loans in the total amount as of such
date of NIS 290 million.
The Company's balance sheet at Sept. 30, 2013, showed NIS4.83
billion in total assets, NIS4.96 billion in total liabilities and
a NIS122.24 million shareholders' deficiency.
Since February 2013, Elbit has intensively endeavored to come to
an arrangement with its creditors. Elbit has said it has been
hanging by a thread for more than five months. It has encountered
cash flow difficulties and this burdens its day to day activities,
and it certainly cannot make the necessary investments to improve
its assets. In light of the arrangement proceedings, and
according to the demands of most of the bondholders, as well as an
agreement that was signed on March 19, 2013, between Elbit and the
Trustees of six out of eight series of bonds, Elbit is prohibited,
inter alia, from paying off its debts to the financial creditors -
- and as a result a petition to liquidate Elbit was filed, and
Bank Hapoalim has declared its debts immediately payable,
threatening to realize pledges that were given to the Bank on
material assets of the Company -- and Elbit undertook not to sell
material assets of the Company and not to perform any transaction
that is not during its ordinary course of business without giving
an advance notice to the trustees.
Accountant Rony Elroy has been appointed as expert for examining
the debt arrangement in the Company.
In July 2013, Elbit Imaging's controlling shareholders, Europe-
Israel MMS Ltd. and Mr. Mordechay Zisser, notified the Company
that the Tel Aviv District Court has appointed Adv. Giroa Erdinast
as a receiver with regards to the ordinary shares of the Company
held by Europe Israel securing Europe Israel's obligations under
its loan agreement with Bank Hapoalim B.M. The judgment stated
that the Receiver is not authorized to sell the Company's shares
at this stage. Following a request of Europe-Israel, the Court
also delayed any action to be taken with regards to the sale of
those shares for a period of 60 days. Europe Israel and
Mr. Zisser have also notified the Company that they utterly reject
the Bank's claims and intend to appeal the Court's ruling.
EMPIRE RESORTS: Expects $13.36MM Proceeds From Rights Offering
--------------------------------------------------------------
Empire Resorts, Inc., concluded its rights offering, in which upon
completion it will issue a total of 2,138,178 shares of common
stock at $6.25 per share and raise approximately $13.36 million in
gross proceeds. This includes 452,462 shares issued to holders
upon exercise of their basic subscription rights, 1,512,629 shares
issued to Kien Huat Realty III Limited, the Company's largest
stockholder, upon exercise of its basic subscription rights and
173,087 shares issued to holders upon exercise of their
oversubscription rights in the Rights Offering.
The Company anticipates using the net proceeds of the Rights
Offering, which the Company expects to be approximately $13.16
million following the deduction of expenses relating to the Rights
Offering, to fund the expenses relating to the development of the
Project and Casino Project and maintaining its on-going operations
and facilities in support of its pursuit of a gaming facility
license.
About Empire Resorts
Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY)
-- http://www.empireresorts.com/-- owns and operates Monticello
Casino & Raceway, a video gaming machine and harness racing track
and casino located in Monticello, New York, 90 miles northwest of
New York City.
Empire Resorts reported a net loss applicable to common shares of
$27.05 million in 2013 following a net loss applicable to common
shares of $2.26 million in 2012. As of Dec. 31, 2013, the Company
had $39.04 million in total assets, $48.82 million in total
liabilities and a $9.77 million total stockholders' deficit.
ENERGY FUTURE: Webinar on Ch. 11 Filing Scheduled for May 8
-----------------------------------------------------------
The Beard Group, Inc. disclosed that four corporate restructuring
experts will review and offer their insights about Energy Future
Holdings Corp.'s chapter 11 filing in a free Webinar at 1:00 p.m.,
Eastern Time, on Thurs., May 8, 2014.
Visit http://bankrupt.com/webinars/for more information and to
register for this Webinar. This Webinar is open to anyone at no
charge, but advance registration for this Webinar is required to
participate.
These four seasoned corporate restructuring professionals:
(A) Edward (Ted) Gavin, a Certified Turnaround Professional and
Managing Partner in Gavin/Solmonese LLC's Wilmington, Del.,
office;
(B) Christopher A. Ward, co-chair of the Bankruptcy and Financial
Restructuring practice and managing shareholder of Polsinelli PC's
Delaware office;
(C) Edward M. Fox, a corporate restructuring lawyer in Polsinelli
PC's New York office; and
(D) Kell C. Mercer, a member of the Financial Services industry
team at Husch Blackwell LLP in Houston, Tex.
will address these three important questions:
(1) How does one of the nation's largest, most complex energy
production companies end up in Chapter 11 -- and how is it going
to get out?
(2) How did the largest LBO in history turn into one of the
largest chapter 11 bankruptcies ever filed -- and how can it be
corrected?
(3) What are the unique bankruptcy, business, and regulatory
issues confronting EFH, its creditors, shareholders, and parties
in interest, and how might they be resolved?
As widely reported, EFH and its debtor-affiliates sought
chapter 11 protection on April 29, 2014, placing $36 billion of
assets under Bankruptcy Court supervision to resolve $49 billion
in liabilities.
This Webinar is produced by Beard Group, Inc. Beard Group
publishes Turnarounds & Workouts, the Troubled Company Reporter,
and the Troubled Company Prospector. Visit
http://bankrupt.com/freetrial/for a free trial subscription to
one or more of Beard Group's corporate restructuring publications.
Beard Group also hosts the annual Distressed Investing conference
in New York City on the Monday following Thanksgiving.
About Energy Future Holdings, fka TXU Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80 percent-owned entity within the EFH group, is the largest
regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases
jointly administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported total assets of $36.4
billion in book value and total liabilities of $49.7 billion. The
Debtors have $42 billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor. The EFIH
unsecured creditors supporting the restructuring agreement are
represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor.
The TCEH first lien lenders supporting the restructuring agreement
are represented by Paul, Weiss, Rifkind, Wharton & Garrison, LLP
as legal advisor, and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring
agreement are represented by Akin Gump Strauss Hauer & Feld LLP,
as legal advisor, and Centerview Partners, as financial advisor.
The EFH equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor.
Epiq Systems is the claims agent. The claims agent maintains a
Web site at http://www.efhcaseinfo.com/
ENERGY FUTURE: June 5 Final Hearing on First Day Requests
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware will
convene a hearing on June 5, 2014, at 9:30 a.m., prevailing
Eastern Time, to consider final approval of several requests filed
by Energy Future Holdings Corp., et al., on the first day of its
Chapter 11 filing.
The final hearing comes after the Court issued interim orders
authorizing the Debtors to:
(a) pay prepetition critical vendor claims provided that the
payments will not exceed an aggregate amount of $30
million, or be made to any affiliate or insider of the
Debtors other than portfolio companies owned by EFH Corp.'s
indirect equity holders with which the Debtors conduct
arm's-length transactions;
(b) honor, pay, or otherwise satisfy prepetition obligations
arising under the Prepetition Hedging and Trading
Arrangements as they come due during the interim period, in
an aggregate amount not to exceed the Prepetition Payment
Cap, which will not exceed $50.8 million; and
(c) honor all obligations under the prepetition customer
agreements in an aggregate amount not to exceed
$14 million.
Also on June 5, the Court will consider approval of the Debtors'
request to assume certain customer agreements.
The bar date for filing proofs of claims for customer claims,
including those held by governmental units solely in their
capacities as customers of the Debtors, is set for Oct. 27. The
Debtors have obtained authority to appoint Epiq Bankruptcy
Solutions, LLC, as the claims and noticing agent.
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reported that Energy Future's first hearing in the Delaware
bankruptcy court ran all day on May 1 and resumed the following
day, with two overflow courtrooms listening. U.S. Bankruptcy
Judge Christopher S. Sontchi, according to Mr. Rochelle, ruled on
several issues that needed immediate attention and deferred others
for final consideration on June 5.
About Energy Future Holdings, fka TXU Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80 percent-owned entity within the EFH group, is the largest
regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases
jointly administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported total assets of $36.4
billion in book value and total liabilities of $49.7 billion. The
Debtors have $42 billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor. The EFIH
unsecured creditors supporting the restructuring agreement are
represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor.
The TCEH first lien lenders supporting the restructuring agreement
are represented by Paul, Weiss, Rifkind, Wharton & Garrison, LLP
as legal advisor, and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring
agreement are represented by Akin Gump Strauss Hauer & Feld LLP,
as legal advisor, and Centerview Partners, as financial advisor.
The EFH equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor.
Epiq Systems is the claims agent. The claims agent maintains a
Web site at http://www.efhcaseinfo.com/
ENERGY FUTURE: Junior Debtholders Take Issue on Valuation
---------------------------------------------------------
Mitchell Schnurman, writing for The Dallas Morning News, reported
that junior debtholders at Energy Future Holdings already have
raised flags about the company's valuation. Management and senior
creditors have an incentive to undervalue the company, Wilmington
Savings Fund, a trustee for EFH creditors, said in a filing,
because they're usually awarded stock. If the starting price is
low, there's more upside. "There are numerous examples of cases
in which management and senior lenders have tried (sometimes
successfully) to use the Chapter 11 process to obtain underpriced
equity," Wilmington said.
Mr. Schnurman said surprises could happen in bankruptcy. He
discussed how, in Six Flags Entertainment Corp., the junior
bondholders resisted the prearranged restructuring plan, forced a
bankruptcy trial and wrested control of the company. They raised
new money, won support from most creditors and installed new
leadership.
Mr. Schnurman noted there are some common threads to consider in
both EFH's and Six Flags' cases: The value of utility companies
has been rising, the economy is improving, and both cases have the
same bankruptcy judge: Christopher Sontchi in Delaware.
A full-text copy of the article is available at
http://is.gd/nXwxMM
About Energy Future Holdings, fka TXU Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80 percent-owned entity within the EFH group, is the largest
regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases
jointly administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported total assets of $36.4
billion in book value and total liabilities of $49.7 billion. The
Debtors have $42 billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor. The EFIH
unsecured creditors supporting the restructuring agreement are
represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for
the second-lien noteholders owed about $1.6 billion, is
represented by Ashby & Geddes, P.A.'s William P. Bowden, Esq., and
Gregory A. Taylor, Esq., and Brown Rudnick LLP's Edward S.
Weisfelner, Esq., Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq.,
Jeremy B. Coffey, Esq., and Howard L. Siegel, Esq.
ENERGY FUTURE: Amends 2013 Annual Report to Add Exhibits
--------------------------------------------------------
Energy Future Holdings Corp. amended its annual report on Form
10-K for the year ended Dec. 31, 2013, which was filed with the
U.S. Securities and Exchange Commission on April 30, 2014, solely
to provide Exhibits 10(cccc) and 10(dddd), which were not included
in the Original Filing. Copies of the Exhibits are available for
free at:
http://is.gd/jFsKxM
http://is.gd/8JxgPH
About Energy Future Holdings, fka TXU Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80 percent-owned entity within the EFH group, is the largest
regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases
jointly administered for procedural purposes.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal and its local counsel is
Richards, Layton & Finger, P.A. Filsinger Energy Partners, Inc.,
acts as the Debtors' energy consultant, Deloitte & Touche LLP
serves as the Debtors' independent auditor, KPMG is the Debtors'
tax advisor. The Debtors' compensation consultant is Towers
Watson & Co. PricewaterhouseCoopers serves as the Debtors'
internal auditing advisor and Ernst & Young LLP serves as the
Debtors' tax auditing advisor.
The TCEH first lien lenders supporting the restructuring agreement
are represented by Paul, Weiss, Rifkind, Wharton & Garrison, LLP
as legal advisor, and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring
agreement are represented by Akin Gump Strauss Hauer & Feld LLP,
as legal advisor, and Centerview Partners, as financial advisor.
The EFH equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor.
Epiq Systems is the claims agent. The claims agent maintains a
Web site at http://www.efhcaseinfo.com/
ENGLOBAL CORP: Awarded Patents and New Projects
-----------------------------------------------
ENGlobal Corporation said that its Universal Master Control
StationTM (UMCS) and its industrial Heating, Ventilation, and Air
Conditioning (HVAC) solution were issued patents by the U.S.
Patent and Trademark Office. The Company also announced that both
the UMCS and HVAC solutions have been awarded new projects based
primarily on the benefits of these respective technologies.
ENGlobal's UMCS monitors and controls subsea equipment from
multiple vendors within a single master control station, among
other features. As previously announced, ENGlobal's first UMCS
was successfully installed on an offshore platform in the Gulf of
Mexico for a major international oil and gas company. The Company
announced a follow-on order for an additional UMCS from the same
client.
ENGlobal's HVAC is used primarily in rugged, industrial
applications including those requiring higher reliability
redundant configurations and hazardous area building
pressurization. The self-contained system incorporates both a
programmable logic controller (PLC) and a human machine interface
(HMI), which provides for both local, as well as networked
operation and monitoring. The HVAC is also specially designed to
operate successfully in very hot ambient temperatures with full
cooling capacity in environments up to 122 degree fareinheit (50
degree celcius. The Company announced that a major drilling
contractor has selected ENGlobal's HVAC for their upcoming driller
cabin applications.
Mr. Michael Martin joined ENGlobal as Subsea Controls and
Integration Business Manager with a focus on developing business
based on the UMCS and other subsea/offshore opportunities. Mike
has over 30 years of entrepreneurial experience introducing new
technology into the oil and gas industry. Prior to joining
ENGlobal, Mr. Martin was a business development manager for
Schlumberger and The Wood Group developing upstream offshore
production and operations optimization solutions for assets in the
Gulf of Mexico, Brazil, Mexico, North Sea, Middle East, Australia,
and West Africa.
"We are pleased that the UMCS and HVAC solutions have become
patented technology as we continue to build and strengthen our
proprietary technology as a differentiator in the energy services
marketplace," said stated William A. Coskey, P.E., Chairman and
CEO of ENGlobal. "Our proprietary technology is validated by wins
from two of our key customers, which we believe will lay the
groundwork for these high potential market segments. Finally, I'm
extremely excited to have Mike Martin's depth of experience now on
our team, and am confident he will greatly expand our prospects
with many new subsea and offshore clients."
About ENGlobal
Houston-based ENGlobal Corporation (Nasdaq: ENG) is a provider of
engineering and related project services primarily to the energy
sector throughout the United States and internationally. ENGlobal
operates through two business segments: Automation and
Engineering. ENGlobal's Automation segment provides services
related to the design, fabrication and implementation of advanced
automation, control, instrumentation and process analytical
systems. The Engineering segment provides consulting services for
the development, management and execution of projects requiring
professional engineering, construction management, and related
support services.
ENGlobal Corporation incurred a net loss of $2.98 million on
$168.96 million of operating revenues for the year ended Dec. 28,
2013, as compared with a net loss of $33.60 million on $227.91
million of operating revenues for the year ended Dec. 29, 2012.
The Company incurred a net loss of $7.07 million in 2011.
As of Dec. 28, 2013, the Company had $45.80 million in total
assets, $23.31 million in total liabilities, all current, and
$22.48 million in total stockholders' equity.
EQUIPMENT ACQUISITION: Administrator's Suits Stay in Bankr. Court
-----------------------------------------------------------------
Several adversary proceedings commenced by William A. Brandt, Jr.,
solely in his capacity as Plan Administrator for Equipment
Acquisition Resources, Inc., will stay in bankruptcy court after
District Judge Samuel Der-Yeghiayan denied, without prejudice, the
motions filed by both the Plan administrator and the defendants
motions to withdraw the bankruptcy reference, the motions for
leave to file interlocutory appeals, the requests for
certification, and the motions to vacate orders.
Judge Der-Yeghiayan said, "The parties have failed to show how the
adversary proceedings, which have been pending in the Bankruptcy
Case since October of 2011, have now in 2014 become an inefficient
forum requiring adjudication by this court. Judicial economy will
be promoted if these cases remain in the bankruptcy court at this
juncture, and are not prematurely and/or improperly withdrawn to
the district court."
A copy of the Court's April 30 Memorandum Opinion is available at
http://is.gd/KDRy3Tfrom Leagle.com.
The defendants in the adversary proceedings are:
* Suntrust Leasing Corporation,
* IBM Credit, LLC,
* Plainscapital Leasing, LLC,
* People's Capital and Leasing Corp.,
* The CIT Group/Equipment Financing, Inc.,
* Pentech Financial Services, Inc.,
* TD Banknorth Leasing Corp.,
* KLC Financial, Inc.,
* American Bank FSB,
* US Bancorp Inc.,
* Leasing One Corporation,
* ICON Ear, LLC, ICON Ea8r II, LLC,
* Ameristar Casino East Chicago, LLC,
* Dana Malone,
* Robert Langford,
* Cory Doran,
* Charter Airlines, LLC,
* Shirley Drucker,
* Richard Drucker,
* Katie Malone,
* Rohr-Alpha, Inc.
Mr. Brandt is represented by:
George P. Apostolides, Esq.
Kevin H. Morse, Esq.
ARNSTEIN & LEHR LLP
120 S. Riverside Plaza, Suite 1200
Chicago, Illinois 60606-3910
Telephone: (312) 876-7100
Facsimile: (312) 876-0288
E-mail: gpapostolides@arnstein.com
khmorse@arnstein.com
About Equipment Acquisition
Palatine, Illinois-based Equipment Acquisition Resources, Inc.,
operated in the semiconductor equipment sales and servicing
industry. It was designed to operate as a refurbisher of special
machinery, a manufacturer of high-end technology parts, and a
process developer for the manufacture of high-technology parts.
The bulk of EAR's stated revenue derived from refurbishing and
selling high-tech machinery; it was set up to purchase high-tech
equipment near the end of its useful life at prices that were low
relative to the cost of new units, and then refurbish using a
propriety process the equipment for sale to end-users at
substantial gross margins.
EaR engaged in a massive fraud from 2005 to 2009. That fraud
included, but was not limited to, selling semiconductor equipment
at inflated prices, leasing the equipment back, misrepresenting
the value of the equipment, and pledging certain pieces of
equipment multiple times to various creditors to secure
financing. It owned 2,000 pieces of semiconductor manufacturing
equipment.
First Premier Capital LLC, claiming to be owed $20 million,
alleged that the scheme has cost creditors up to $175 million.
EAR filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ill.
Case No. 09-39937) on Oct. 23, 2009. Barry A. Chatz, Esq., at
Arnstein & Lehr LLP, served as the Company's counsel. The Company
estimated $10 million to $50 million in assets and $100 million to
$500 million in liabilities in its petition. Unsecured creditors
were owed about $102 million.
EURAMAX HOLDINGS: Scott Vansant Appointed North America President
-----------------------------------------------------------------
Senior Vice President, Euramax North America, Scott Vansant has
been named president, Euramax North America. This appointment
reflects a change in the operating management structure of Euramax
Holdings, Inc., effective as of April 28, 2014. The Company also
announced that SVP, Managing Director Europe, Jan Timmerman's
title has been changed to president, managing director
International to reflect the expanding international presence of
the Company's European-based businesses.
Senior Vice President, General Counsel and Corporate Secretary,
Shyam K. Reddy has been named chief administrative officer,
general counsel and corporate secretary. Mr. Reddy will lead the
Company's legal, information technology, human resources, real
estate, compliance and risk management functions.
Hugh Sawyer, interim president of Euramax Holdings, Inc., and a
professional in Huron Consulting Group's Business Advisory
Practice, said that the "The organizational changes we are making
better position the Company for enhanced participation in
recovering markets." Naming Scott as North American President
consolidates P&L responsibility and aligns domestic sales and
operational functions in order to maximize growth opportunities
following the 2009 recession. We believe that establishing a
customer-facing integrated sales and operations model will
accelerate decision making in the field substantially for the
benefit of our customers, supply chain partners, employees and
other stakeholders. Shyam's appointment further highlights our
desire to leverage the Company's evolving technology to create
value for our customers and facilitate efficiencies in our
manufacturing and supply chain platform."
Added Mr. Sawyer, "We anticipate that these strategic
modifications to our management structure will drive speed of
execution, while enabling the Company to continue to provide
innovative solutions and high quality products to its customers in
the North American market. I am confident that Scott and Shyam
will prove to be highly impactful in their expanded roles and
responsibilities. Further, Jan's appointment as President,
Managing Director International demonstrates commitment to our
international markets and customers."
Prior to his appointment as president, Euramax North America, Mr.
Vansant led the North American sales and marketing organization as
senior vice president, Euramax North America. Mr. Vansant was the
chief financial officer and treasurer of Euramax from July 1998
until October 2013. He joined Alumax in 1991. From 1995 to 1996,
Mr. Vansant served as director of Internal Audit for Alumax and
also served in various operational positions at Alumax Building
Products, Inc., including serving as Controller from 1993 to 1995
and Branch Manager from 1992 to 1993. Prior to 1991, Mr. Vansant
worked as a certified public accountant for Ernst & Young LLP.
Mr. Vansant received a BBA in Accounting from Mercer University in
1984.
Prior to his appointment as chief administrative officer, general
counsel and corporate secretary, Mr. Reddy had responsibility of
the legal, human resources, real estate, and compliance functional
areas of the Company. With this promotion, Mr. Reddy is assuming
responsibility for the Company's information technology and risk
management functions as well. Prior to joining the Company, Mr.
Reddy served in the Obama Administration as the Southeast Sunbelt
Region Regional Administrator of the U.S. General Services
Administration ("GSA"). Mr. Reddy practiced law as a Partner in
the Corporate Group at Kilpatrick Townsend & Stockton, an Atlanta
based international law firm, before working at GSA. Mr. Reddy
earned both a Bachelor of Arts and a Masters in Public Health from
Emory University and his Juris Doctorate from the University of
Georgia.
Additional information is available for free at:
http://is.gd/DqRVe9
About Euramax Holdings
Euramax Holdings Inc. is an international producer of metal and
vinyl products sold to the residential repair and remodel, non-
residential construction and recreational vehicle markets
primarily in North America and Europe. It considers itself a
leader in several niche product categories, including preformed
roof-drainage products sold in the U.S., metal roofing and siding
for wood frame construction in the U.S., and aluminum siding for
towable RVs in the U.S. and Europe.
Euramax Holdings' balance sheet at Dec. 31, 2012, showed $594.42
million in total assets, $680.41 million in total liabilities and
a $85.99 million total shareholders' deficit.
* * *
As of June 30, 2010, Euramax carries "Caa1" long-term debt ratings
from Moody's and "B-" long-term debt ratings from Standard &
Poor's.
FEDERACION DE MAESTROS: Motion to Alter Order Denied
----------------------------------------------------
Bankruptcy Judge Brian K. Tester denied the Motion to Alter or
Amend Order pursuant to Fed. R. Civ. P. 59 and Fed. R. Bankr. P.
9023 filed by Federacion de Maestros de Puerto Rico.
Several creditors collectively known as Asociacion de Maestros de
Puerto Rico objected.
The motion before the court stems from the Debtor's denied
turnover motion. There is an ongoing civil dispute before the
state court over funds owed to the Creditor's members. Given this
dispute, $1,074,944.00 were consigned with the state court. In its
turnover motion, the Debtor argued that these funds are property
of the bankruptcy estate. After careful consideration of the
parties' positions, the court denied the Debtor's turnover motion
and held that it is precluded from adjudicating the ownership
controversy over the Consigned Funds. The court reasoned that the
determination of ownership is at its most fundamental level a
complex accounting function that should be determined by the state
court. In no way does it involve matters concerning the
administration of a debtor's estate. Therefore, on Feb. 27, 2014,
the court issued an order denying the Debtor's Motion to Turnover
Property, and abstaining from determining the ownership of the
Consigned Funds.
On March 13, 2014, the Debtor filed its Motion to Alter or Amend
the Opinion and Order. The Debtor argues that because monies have
already been distributed by the Department of Education to the
Creditor's members, the matter of ownership is moot. As a result,
the Debtor argues that the court's Feb. 27, 2014 order constitutes
manifest error, should be vacated, and requests the granting of
its motion to turn over the Consigned Funds.
The Creditor responds to the motion by arguing that the Debtor's
mootness argument is without merit. While many of the Creditor's
members have received their portion of the monies owed, the
Creditor notes that many have not. Additionally, the Creditor
argues that regardless of whether the monies owed have been
appropriately distributed, the controversy is not moot as long as
the Debtor claims ownership over the Consigned Funds.
A copy of the Court's May 1, 2014 Opinion and Order is available
at http://is.gd/0mzhztfrom Leagle.com.
Federacion De Maestros De Puerto Rico, Inc., in San Juan, Puerto
Rico, filed for Chapter 11 (Bankr. D. P.R. Case No. 11-07143) on
Aug. 26, 2011. Judge Brian K. Tester presides over the case.
Charles Alfred Cuprill, Esq., at Charles A Curpill, PSC Law
Office, serves as the Debtor's counsel. In its petition, the
Debtor estimated assets of US$1 million to US$10 million, and
debts of US$10 million to US$50 million. The petition was signed
by Rafael Feliciano Hernandez, president.
FIAT CHRYSLER: Sketches Bigger Roles for Premium Car Brands
-----------------------------------------------------------
Christina Rogers, Mike Ramsey and Eric Sylvers, writing for The
Wall Street Journal, reported that Fiat Chrysler Automobiles NV
outlined an ambitious five-year plan to boost the company's global
vehicle sales nearly 60% to 7 million by 2018, even as it
disclosed a net loss for the latest quarter.
According to the report, the world's seventh largest auto maker
said it would spend about EUR48 billion ($66.85 billion) on
research and development and capital investments through 2018 on
new models. Some of that money would come from new debt after a
New York stock listing later this year, it said. Fiat also would
refinance Chrysler's debt in 2016 to free up more cash.
Chief Executive Sergio Marchionne and top executives outlined a
business plan at Chrysler's headquarters here that anticipates
significant gains for Fiat and Chrysler brands in the U.S., Asia,
Latin America and Europe, the report related.
By the end of 2018, Fiat Chrysler aims to achieve revenue of
EUR132 billion a year -- a 52% increase over 2013 -- and net
income of between EUR4.7 billion to EUR5.5 billion, up from
EUR1.95 billion last year, the report further related.
Fiat Chrysler's goal of selling seven million cars a year in 2018
depends on big gains -- by its Jeep and Alfa Romeo brands, the
report said. Executives said they plan to more than double world-
wide Jeep sales to 1.9 million vehicles a year. Alfa Romeo will
get a fresh start with a EUR5 billion infusion of capital to build
out its portfolio with eight new models by 2018.
About Chrysler Group
Chrysler Group LLC, formed in 2009 from a global strategic
alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram
Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles
and products. Headquartered in Auburn Hills, Michigan, Chrysler
Group LLC's product lineup features some of the world's most
recognizable vehicles, including the Chrysler 300, Jeep Wrangler
and Ram Truck. Fiat will contribute world-class technology,
platforms and powertrains for small- and medium-sized cars,
allowing Chrysler Group to offer an expanded product line
including environmentally friendly vehicles.
Chrysler LLC and 24 affiliates on April 30, 2009, sought Chapter
11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead
Case No. 09-50002). The U.S. and Canadian governments provided
Chrysler LLC with $4.5 billion to finance its bankruptcy case.
In connection with the bankruptcy filing, Chrysler reached an
agreement to sell all assets to an alliance between Chrysler and
Italian automobile manufacturer Fiat. Under the terms approved by
the Bankruptcy Court, the company formerly known as Chrysler LLC
in June 2009, formally sold substantially all of its assets to the
new company, named Chrysler Group LLC.
In January 2014, the American car manufacturer officially became
100% Italian when Fiat Spa completed its deal to purchase the 40%
it did not already own of Chrysler. Fiat has shared ownership of
Chrysler with the health care fund of the United Automobile
Workers unions since Chrysler emerged from bankruptcy in 209.
* * *
Standard & Poor's Ratings Services raised its ratings on U.S.-
based auto manufacturer Chrysler Group LLC, including the
corporate credit rating to 'BB-' from 'B+' in mid-January 2014.
The outlook is stable.
FIRST PHYSICIANS: Adrian Reeder Appointed EVP and CFO
-----------------------------------------------------
The Board of Directors of First Physicians Capital Group, Inc.,
appointed Adrian B. Reeder to the position of executive vice
president and chief financial officer effective April 10, 2014, to
serve until his successor is duly appointed and qualified or until
his earlier resignation or removal. Mr. Reeder has no family
relationship with any officer or director of the Company or any of
its subsidiaries.
Mr. Reeder, 40, brings over 14 years of experience in finance and
accounting. Since 2013, Mr. Reeder served as a senior consultant
for NowCFO, a professional services firm providing outsourced CFO
services. From 2010 until 2013, Mr. Reeder served as audit
manager and consultant for Kezos & Dunlavy, LLC, an accounting
firm serving the Southern Utah market. Prior to 2010, Mr. Reeder
was involved in several ventures, including founding Old
Cobblestone Road, LLC, an online retail company, and serving as
director of finance for Elim Valley Planning & Development, LLC, a
2,400 acre master planned real estate development in Southern Utah
where he helped raise over $24,000,000 in real estate financing.
Mr. Reeder began his career with KPMG, LLP and held the position
of manager at his departure. Mr. Reeder received a B.S. and
Masters in Accountancy in 2000 from Brigham Young University and
is a Certified Public Accountant, licensed in the State of Utah.
In connection with Mr. Reeder's appointment as executive vice
president and chief financial officer, the Board approved an
employment agreement with Mr. Reeder. The term of the employment
agreement is two years. The employment agreement provides that,
among other things, during the Term, Mr. Reeder will: (1) receive
an initial base salary of $185,000, (2) be eligible to participate
in the Company?s employee benefit plans and other benefits, and
(3) be eligible to receive a cash bonus with a payment equal to 50
percent of his base salary upon achievement of strategic goals and
objectives of his position. He will also be eligible to receive
additional discretionary bonuses and to participate in any
executive equity compensation plan. In the event that Mr. Reeder
is terminated without cause during the Term, he will be entitled
to receive (a) a severance pay equal to 50 percent of his base
salary, (b) any earned but unpaid bonuses, (c) health benefits
until the earlier of six months from the date of termination and
his eligibility to participate in a similar health plan, and (d)
payment of any unreimbursed expenses and accrued but unused paid
time off. The Company will also reimburse up to $10,000 of Mr.
Reeder's relocation expenses for his move from Salt Lake City,
Utah to Dallas, Texas.
On March 21, 2014, the Board approved a Consulting Agreement
Addendum which amends the Consulting Agreement between Sean
Kirrane, the Company's chief executive officer, and the Company.
The Addendum removed certain bonus criteria, including the
deadline for filing certain delinquent periodic reports.
About First Physicians
Beverly Hills, Calif.-based First Physicians Capital Group, Inc.
(OTC BB: FPCG) -- http://www.fpcapitalgroup.com/-- is an operator
of healthcare services firms in the U.S.
The Company's balance sheet at Dec. 31, 2010, showed $24.6 million
in total assets, $28.9 million in total liabilities, $191,000 in
non-redeemable preferred stock, $12.2 million in redeemable
preferred stock, and a stockholders' deficit of $16.7 million.
As reported in the Troubled Company Reporter on Feb. 21, 2011,
Whitley Penn LLP, in Dallas, Texas, expressed substantial doubt
about First Physicians Capital Group's ability to continue as a
going concern, following the Company's results for the fiscal year
ended Sept. 30, 2010. The independent auditors noted that the
Company has experienced recurring losses from operations.
The Company has not filed any periodic report after its quarterly
report for the period ended Dec. 31, 2010.
FNBH BANCORP: Obtains $1.6 Million From Rights Offering
-------------------------------------------------------
First National Bank, announced the successful completion by its
holding company, FNBH Bancorp, Inc., of a rights offering that
generated $1.6 million in gross capital proceeds.
The Company's previously-announced rights offering for up to 2.3
million shares of the Company's common stock was oversubscribed.
The Company received subscriptions to purchase an aggregate of
approximately 6.6 million shares, representing approximately $4.6
million in gross subscriptions. Although the Company had reserved
the right to reject any or all oversubscriptions, the Company's
Board of Directors has decided to sell all 2.3 million shares
offered in the rights offering. After fulfilling each
shareholder's basic subscription right in full, the Company will
allocate the remaining shares among shareholders who
oversubscribed in the manner set forth in the prospectus filed
with the SEC. Excess subscription payments will be returned by
the subscription agent to subscribers, without interest, as soon
as practicable.
Under the completed rights offering, holders of the Company's
common stock as of the record date of Jan. 8, 2014, were given
non-transferable subscription rights to purchase up to 6 shares of
the Company's common stock for each 1 share owned as of the record
date, at a subscription price of $0.70 per share.
About FNBH Bancorp
Howell, Michigan-based FNBH Bancorp, Inc., is a one-bank holding
company, which owns all of the outstanding capital stock of First
National Bank in Howell. The Bank was originally organized in
1934 as a national banking association. As of Dec. 31, 2011, the
Bank had approximately 85 full-time and part-time employees. The
Bank serves primarily five communities, Howell, Brighton, Green
Oak Township, Hartland, and Fowlerville, all of which are located
in Livingston County.
FNBH disclosed net income of $329,000 in 2012, as compared with a
net loss of $3.57 million in 2011. The Company's balance sheet at
Sept. 30, 2013, showed $301.79 million in total assets, $292.65
million in total liabilities and $9.14 million in total
shareholders' equity.
BDO USA, LLP, in Grand Rapids, Michigan, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2012.
"The Corporation's subsidiary bank ("Bank") is significantly
undercapitalized under regulatory capital guidelines and, during
2009, the Bank entered into a consent order regulatory enforcement
action ("consent order") with its primary regulator, the Office of
the Comptroller of the Currency. The consent order requires
management to take a number of actions, including, among other
things, increasing and maintaining its capital levels at amounts
in excess of the Bank's current capital levels. As discussed in
Note 20, the Bank has not yet met the higher capital requirements
and is therefore not in compliance with the consent order. As a
result of the uncertain potential impact of future regulatory
actions, circumstances exist that raise substantial doubt about
the Corporation's ability to continue as a going concern."
FOUNDATION HEALTHCARE: Incurs $3.5 Million Net Loss in 4th Qtr.
---------------------------------------------------------------
Foundation Healthcare, Inc., reported a net loss attributable to
the Company of $3.53 million on $26.12 million of revenues for the
three months ended Dec. 31, 2013, as compared with a net loss
attributable to the Company of $757,357 on $17.61 million of
revenues during the prior year.
For the year ended Dec. 31, 2013, the Company reported a net loss
attributable to the Company of $19.40 million on $93.14 million of
revenues as compared with net income attributable to the Company
of $3.72 million on $52.97 million of revenues in 2012.
As of Dec. 31, 2013, the Company had $55.27 million in total
assets, $61.85 million in total liabilities, $8.70 million in
preferred noncontrolling interests and a $15.27 million total
deficit.
"When we completed the acquisition of the Foundation entities
(Foundation Surgery Affiliates, LLC and Foundation Surgical
Hospital Affiliates, LLC) in July 2013, we knew this was a
transformative event which culminated in the changing of our name
from Graymark Healthcare, Inc. to Foundation Healthcare, Inc. in
December 2013. Following the successful integration of the
companies during the 3rd quarter, we were able to focus our
strategic efforts during the 4th quarter on the growth of our
hospitals in San Antonio and El Paso, Texas. We look forward to
expanding the combined business by growing our existing hospitals,
increasing our geographic footprint and providing excellent
experiences to all our patients. Foundation, as a public company,
provides us with flexibility in building out our services in
existing markets as well as establishing a presence in additional
geographies," stated Stanton Nelson, CEO of Foundation Healthcare,
Inc.
A copy of the press release is available for free at:
http://is.gd/upK08d
About Foundation Healthcare
Headquartered in Oklahoma City, Okla., Foundation Healthcare,
Inc., formerly known as Graymark Healthcare, Inc., (OTCQB: FDNH)
focuses on the development and management of surgical hospitals
and the inclusion of ancillary service lines. These additional
service lines, such as hyperbarics, sleep labs, intraoperative
monitoring, imaging and robotic surgery, truly make the Foundation
specialty hospital environment unique.
The Company is also an industry leading ASC management and
development company focused on partnering with physicians and
employees to create an outstanding patient experience, while
maximizing partner and shareholder value. The Company is a leader
in offering turnkey management and development solutions for
physician partners, as well as creating an optimal experience for
the patients we serve. Visit http://www.fdnh.com/
Going Concern
As of March 31, 2013, the Company had an accumulated deficit of
$60.2 million and reported a net loss of $2.7 million for the
first quarter of 2013. In addition, the Company used $0.3 million
in cash from operating activities from continuing operations
during the quarter. On March 29, 2013, the Company signed a
definitive purchase agreement with Foundation Healthcare
Affiliates, LLC to purchase 100 percent of the interests in
Foundation Surgery Affiliates, LLC and Foundation Surgical
Hospital Affiliates, LLC, in exchange for 98.5 million shares of
the Company's common stock. Management expects the transaction to
close in the second quarter of 2013; however, there is no
assurance the acquisition will close at that time or at all.
"If the Company is unable to close the Foundation transaction or
raise additional funds, the Company may be forced to substantially
scale back operations or entirely cease its operations and
discontinue its business. These uncertainties raise substantial
doubt regarding the Company's ability to continue as a going
concern," according to Graymark Healthcare's quarterly report for
the period ended March 31, 2013.
FRESH & EASY: Disclosure Statement Hearing Set for May 30
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware will
convene a hearing on May 30, 2014, at 11:00 a.m., to consider
approval of the disclosure statement explaining Old FENM Inc., et
al.'s Joint Chapter 11 Plan of Liquidation. Objections to the
Disclosure Statement must be filed on or before May 23.
As previously reported by The Troubled Company Reporter, the
Debtors, on April 21, filed with the Court a Chapter 11
liquidating plan, which proposes to pay general unsecured claims
in full, plus the postpetition interest amount at the so-called
federal judgment rate, or about 0.1 percent. That Plan was not
accompanied by a disclosure statement, which states how much
creditors stand to recover.
On April 25, the Debtors filed the Disclosure Statement, showing
that holders of general unsecured claims, estimated to total
$40,512,000, will receive 100% of their claim amount, while Tesco
plc, the Debtors' parent, will recover 6.4% of its claim,
estimated to total $907,175,400. A full-text copy of the
Disclosure Statement is available at:
http://bankrupt.com/misc/FENMds0425.pdf
About Fresh & Easy Neighborhood
Fresh & Easy Neighborhood Market Inc., and its affiliate filed
Chapter 11 petitions (Bankr. D. Del. Case Nos. 13-12569 and
13-12570) on Sept. 30, 2013. The petitions were signed by James
Dibbo, chief financial officer. Judge Kevin J. Carey presides
over the case.
Fresh & Easy owes $738 million to Cheshunt, England-based Tesco,
the U.K.'s biggest retailer. Fresh & Easy never made a profit and
lost an average of $22 million a month in the 12 months ended in
February, according to court papers.
Jones Day serves as lead bankruptcy counsel. Richards, Layton &
Finger, P.A., serves as local Delaware counsel. Alvarez & Marsal
North America, LLC, serves as financial advisors, and Alvarez &
Marsal Securities, LLC, serves as investment banker. Prime Clerk
LLC acts as the Debtors' claims and noticing agent. Gordon
Brothers Group, LLC, and Tiger Capital Group, LLC, serves as the
Debtors' consultant. The Debtors estimated assets of at least $100
million and liabilities of at least $500 million.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed five
creditors to serve in the Official Committee of Unsecured
Creditors in the Chapter 11 cases of Fresh & Easy Neighborhood
Market Inc., et al. Pachulski Stang Ziehl & Jones LLP serves as
counsel to the Committee. FTI Consulting, Inc. serves as its
financial advisor.
The Debtors closed, on or about Nov. 26, 2013, the sale of about
150 supermarkets plus a production facility in Riverside,
California, to Ron Buckle's Yucaipa Cos. Pursuant to the sale
terms, the bankruptcy company changed its name, and the name of
the case, to Old FENM Inc.
FUSION TELECOMMUNICATIONS: Registers 420.6MM Shares for Resale
--------------------------------------------------------------
Fusion Telecommunications International filed with the U.S.
Securities and Exchange Commission a Form S-1 registration
statement relating to the resale of an aggregate of 420,679,212
shares of common stock of the Company which may be offered from
time to time by George Igler, Adam Stern, Alan H Buerger, et al.
The shares being resold consist of:
* 60,650,109 shares of issued and outstanding common stock;
* 202,455,000 shares issuable upon conversion of outstanding
Series B-2 Preferred Stock; and
* 157,574,103 shares issuable upon exercise of outstanding
common stock purchase warrants.
The Company will not receive any proceeds from the sale of these
shares by the selling security holders, but the Company may
receive proceeds from the exercise of the warrants, if exercised.
The Company's common stock is currently quoted on the OTCQB
marketplace and trades under the symbol "FSNN." On May 1, 2014,
the closing price for the Company's common stock on the OTCQB
marketplace was $0.095 per share.
A copy of the Form S-1 is available for free at:
http://is.gd/YsEbYr
About Fusion Telecommunications
New York City-based Fusion Telecommunications International, Inc.
(OTC BB: FSNN) is a provider of Internet Protocol ("IP") based
digital voice and data communications services to corporations and
carriers worldwide.
Fusion Telecommunications incurred a net loss applicable to common
stockholders of $5.48 million in 2013, a net loss applicable to
common stockholders of $5.61 million in 2012 and a net loss of
$4.45 million in 2011. The Company's balance sheet at Dec. 31,
2013, shows $68.95 million in total assets, $62 million in total
liabilities and $6.95 million in total stockholders' equity.
Rothstein Kass, in New York, did not issue a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2013. The independent auditors previously
expressed substantial doubt about the Company's abilitity to
continue as a going concern in their report on the consolidated
financial statements for the year ended Dec. 31, 2012. The
independent auditors noted that the Company has had negative
working capital balances, incurred negative cash flows from
operations and net losses since inception, and has limited capital
to fund future operations that raises a substantial doubt about
their ability to continue as a going concern.
GENCO SHIPPING: Limited General Bar Date Set for May 22
-------------------------------------------------------
In the Chapter 11 cases of Genco Shipping & Trading Limited and
its subsidiaries, Judge Sean Lane on April 24, 2014, entered
certain first day orders including the approval of the assumption
of the Restructuring Support Agreement and setting a combined
hearing to consider approval of the disclosure statement and
confirmation of the Plan on June 3, 2014 at 11:00 a.m. (prevailing
Eastern Time). Plan objections are due May 22. Objecting
parties, however, must have a representative available to discuss
the objection prior to May 30.
The Court also has set a Limited General Bar Date applying to
certain claims, for May 22, 2014 at 5:00 p.m. (prevailing Eastern
Time). A Governmental Bar Date was set for Oct. 20, 2014 at 5:00
p.m. (prevailing Eastern Time).
About Genco Shipping & Trading
New York-based Genco Shipping & Trading Limited (NYSE: GNK)
transports iron ore, coal, grain, steel products and other drybulk
cargoes along worldwide shipping routes. Excluding Baltic Trading
Limited's fleet, Genco Shipping owns a fleet of 53 drybulk
vessels, consisting of nine Capesize, eight Panamax, 17 Supramax,
six Handymax and 13 Handysize vessels, with an aggregate carrying
capacity of approximately 3,810,000 dwt. In addition, Genco
Shipping's subsidiary Baltic Trading Limited currently owns a
fleet of 13 drybulk vessels, consisting of four Capesize, four
Supramax, and five Handysize vessels.
Genco Shipping & Trading sought bankruptcy protection (Bankr.
S.D.N.Y. Lead Case No. 14-11108) on April 21, 2014, to implement a
prepackaged financial restructuring that is expected to reduce the
Company's total debt by $1.2 billion and enhance its financial
flexibility. The company's subsidiaries other than Baltic Trading
Limited (and related entities) also sought bankruptcy protection.
Genco, owned and controlled by Peter Georgiopoulos, disclosed
assets of $2.448 billion and debt of $1.475 billion as of Feb. 28,
2014.
Adam C. Rogoff, Esq., and Anupama Yerramalli, Esq., at Kramer
Levin Naftalis & Frankel LLP serve as the Debtors' bankruptcy
counsel. Blackstone Advisory Partners, L.P., is the financial
advisor. GCG Inc. is the claims and notice agent.
Wilmington Trust, N.A., in its capacity as successor
administrative and collateral agent under a 2007 credit agreement,
is represented by Dennis Dunne, Esq., and Samuel Khalil, Esq., at
Milbank Tweed Hadley & McCloy LLP.
Credit Agricole Corporate & Investment Bank, as agent and security
trustee under an August 2010 Loan Agreement; Deutsche Bank
Luxembourg S.A., as agent, and Deutsche Bank AG Fillale
Deutschlandgeschaft, as security agent and bookrunner under the
August 2010 Loan Agreement, are represented by Alan Kornberg,
Esq., and Elizabeth McColm, Esq., at Paul Weiss Rifkind Wharton &
Garrison LLP.
The Bank of New York Mellon, the indenture trustee for Genco's
5.00% Convertible Senior Notes due August 15, 2014, and the
informal group of 5.00% Convertible Senior Notes due August 15,
2014, are represented by Michael Stamer, Esq., and Sarah Link
Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP.
GENERAL MOTORS: Summary Judgment v. Sherif Rafik Kodsy Affirmed
---------------------------------------------------------------
In the Chapter 11 case of Motors Liquidation Company, District
Judge Lorna G. Schofield affirmed Bankruptcy Judge Robert E.
Gerber's order which summarily denied the Motion for Summary
Judgment filed by Sherif Rafik Kodsy for "failure to show a prima
facie entitlement to relief."
Kodsy filed Proof of Claim No. 69683 in the Motors Liquidation
Company chapter 11 cases dated Jan. 4, 2010. In 2009, he brought
a personal injury case against General Motors in the 15th Judicial
Circuit Court in Palm Beach County, Florida, for "personal injury,
conspiracy, fraud, gross negligence, strict liability, [and]
punitive damages," arising out of an alleged defect in Kodsy's
previously owned Hummer H2 vehicle. The case is, Sherif Rafik
Kodsy vs. General Motors Corporation, Case No. 09-CA-011174.
To liquidate the claim, the Motors Liquidation Company GUC Trust,
sought and received permission from the Bankruptcy Court in May
2013 to allow the Florida action, which had previously been stayed
as a result of the Debtors' bankruptcy filing, to proceed in
Florida state court. In August 2013, the Florida state court
entered an order finding Kodsy to be a vexatious litigant, and
required Kodsy to post security in the amount of $35,000 within 30
days of its order to secure the payment of costs and expenses
likely to be incurred by the Trust in defending the Florida
action. Pursuant to the Order, failure to post the security would
result in the dismissal with prejudice of the Florida action.
Kodsy failed to comply with the Florida state court order to post
security, and the Florida action was consequently dismissed with
prejudice on Nov. 6, 2013. Kodsy appealed this dismissal to
Florida's Fourth District Court of Appeal, which appeal is
currently pending. Separately, Kodsy filed the Motion for Summary
Judgment with the Bankruptcy Court, but Judge Gerber summarily
denied his summary judgment motion for failure to state a prima
facie claim for relief.
A copy of the District Court's April 29, 2014 Opinion and Order is
available at http://is.gd/J1VJmQfrom Leagle.com.
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.
GENERAL MOTORS: Asks Halt to Suits Relating to Bankruptcy
---------------------------------------------------------
Stephanie Gleason, writing for The Wall Street Journal, reported
that General Motors Co. is asking those suing it over ignition-
switch issues to voluntarily halt those lawsuits, according to
documents filed ahead of the May 2 bankruptcy-court hearing on the
issue.
According to the Journal, the lawsuits, which seek damages over
things such as lower car value and loss of use of a vehicle,
should be stayed within 10 days, GM said in a letter dated May 1
to U.S. Bankruptcy Judge Robert Gerber, as the bankruptcy court
decides whether GM can be held liable for these issues.
If the parties suing refuse, they should be required to file
documents with the bankruptcy court by May 25, and GM will respond
by June 10, the Journal related.
Law360 also reported that General Motors fought back against
"forum shopping" consumers trying to pull dozens of ignition
switch recall lawsuits nationwide into the Central District of
California, saying any consolidated litigation belongs in New
York, where GM's bankruptcy court is considering whether to shut
down the suits.
According to Law360, in a filing before the U.S. Judicial Panel on
Multidistrict Litigation, GM said that the Southern District of
New York is the "only appropriate venue" for uniting the 58
pending consumer fraud actions scattered over 25 federal district
courts, despite the fact that more than a third of those have
originated in the Central District of California. The suits seek
redress for GM customers' economic losses from the ignition switch
defect and subsequent vehicle recall.
GM maintains that consolidation in New York makes the most sense
because it recently asked the New York bankruptcy court that
oversaw its 2009 reorganization to bar the suits, the Law360
report related. GM has argued to U.S. Bankruptcy Judge Robert E.
Gerber that a sale order that paved the company's path out of
Chapter 11 shields its new incarnation from liability for the
recalled vehicles, all of which were manufactured prebankruptcy.
"Accordingly, the ignition switch cases should be transferred to
the Southern District of New York, which is in the best position
to coordinate proceedings in the district court and in the
bankruptcy court on the scope and application of the sale order,"
the motion said, the report added.
In a separate report, Law360 said that the American automotive
industry has revitalized itself in the five years since General
Motors and Chrysler's historic bankruptcies, and experts say the
sector has learned some valuable lessons about how to manage
operations along the way.
The Law360 report pointed out that while GM is now at the center
of widespread accusations and investigations into its ignition
switch defect that forced it to recall 2.6 million vehicles, but
in June 2009 it was known for helping to kick off the auto
industry recession with its hundreds of billions of dollars in
debt. With the help of a government bailout, the industry has
largely gotten back on its feet.
Law360 said the three lessons the industry has learned since the
sector tanked five years ago: (1) bankruptcy can be key to
prosperity; (2) "check your ego at the door; and (3) "make it work
with workers, retirees."
The multidistrict litigation case is RUFF et al v. GENERAL MOTORS
LLC et al., Case No. 3:14-cv-02375 (MDL).
About General Motors Corp.,
nka 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.
GENERAL MOTORS: Offers New Discount to Owners of Recalled Cars
--------------------------------------------------------------
Jeff Bennett, writing for The Wall Street Journal, reported that
General Motors Co. is doubling-down on its own version of a "cash-
for-clunkers" program, offering owners of cars involved in the
ignition-switch recall the same deep discounts to buy a new car
usually given only to company employees.
According to the report, the move is the latest sign that GM,
spurred by feedback from its dealers, is shrugging off its initial
reluctance and using the recall as an opportunity to sell new
vehicles. Employee pricing sets the cost of a vehicle at just
under the invoice price. The deal can be used on a new 2013, 2014
or 2015 model year Chevrolet, Buick, GMC or Cadillac.
In March, GM began offering a $500 discount to consumers who
wanted to ditch a recalled Chevrolet Cobalt, Saturn Ion or other
older models to buy or lease a new GM product, the report related.
Dealers say the offer fell flat since many of the vehicles are
secondary cars driven by younger adults or are owned by people who
can't afford to buy a new car even with a discount.
The earlier offer also came when many people driving older,
recalled cars hadn't yet taken advantage of GM's offer to drive a
free "loaner" car, the report further related. There are now more
than 30,000 people driving newer GM vehicles, which offer upgrades
in infotainment and safety technology compared with the nearly
decade-old models they parked.
"We want to give our dealers as many tools as they need to respond
to customers," GM spokesman Jim Cain said, the report cited. "We
certainly listened to our dealers when it came time to offering
this new program."
About General Motors Corp.,
nka 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.
GIBSON BRANDS: Moody's Rates $150MM 2nd Lien Senior Notes 'B3'
--------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Gibson Brands'
proposed $150 million add-on senior secured 2nd lien notes due
2018. The company's existing 8.875% $225 million senior secured
notes due 2018 were downgraded to B3 from B2. Gibson's B2
Corporate Family Rating and B2-PD Probability of Default Rating
were affirmed. The rating outlook remains stable.
Proceeds from the notes will be used to fund the proposed
acquisition of WOOX Innovations for $135 million, representing an
EBITDA purchase multiple of about 3.6 times (excluding the impact
of royalty payments under an ongoing licensing agreement that has
been agree to with the seller), including the assumption of
certain expense related separation costs. Woox is the audio,
video, multimedia and accessories business of Royal Philips,
marketing and distributing products in home cinema (DVD players),
docking speakers and headphones.
The affirmation of Gibson's B2 Corporate Family Rating considers
the size and product diversification benefits afforded by the
proposed WOOX acquisition. On a pro forma basis, the acquisition
will more than triple the size of Gibson's revenue, to about $2.3
billion pro forma from under $700 million, and will also expand
and compliment the company's existing consumer electronics
business. Also, given the purchase price, Gibson's pro forma
debt/EBITDA (including Moody's standard adjustments) is about 5.2
times. This compares favorably to the company's 5.9 times
debt/EBITDA for the twelve months ended December 31, 2013.
The affirmation also considers Gibson's increased exposure to the
risks inherent in the consumer electronic business as a result of
the acquisition: technology risk, low operating margins, and high
degree of competition. Pro forma for the acquisition, consumer
electronics will account for about 85% of Gibson's consolidated
revenue compared to about 50% for the twelve months ended December
31, 2013.
The downgrade of Gibson's existing 2nd lien notes to B3 along with
the assignment of B3 to the 2nd lien add-on consider the
significant amount of foreign trade payables that will be acquired
as part of the WOOX acquisition (about $250 million) and that will
be senior to the 2nd lien notes. There also is a $75 million
asset-based loan that is ahead of the 2nd line notes in the
capital structure.
The stable outlook reflects Moody's expectation that Gibson's
earnings growth will only be modest along with the fact that there
will be no prepayable debt in the company's pro forma capital
structure. As a result, Gibson's debt/EBITDA is expected to remain
high between 5.0 and 5.5 times, but still below the 6.0 times
debt/EBITDA trigger that could lead to a negative ratings action.
Ratings affirmed:
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
Rating downgraded:
$225 million senior secured 2nd lien notes due 2018, to B3
(LGD 4, 64%) from B2 (LGD 3, 44%)
Rating assigned:
$150 million add-on senior secured 2nd lien notes due 2018, at
B3 (LGD 4, 64%);
Rating Rationale
In addition to high leverage and increased exposure to the
consumer electronics business, Gibson's B2 Corporate Family Rating
considers the highly discretionary nature of its musical
instrument product line as it relates to consumer spending. Demand
for these products was dampened by the deterioration in
discretionary consumer spending during the last few years.
Key concerns also include Moody's expectation that Gibson will
continue to use its financial resources to pursue further
strategic acquisitions as opposed to debt repayment, and that
there has been a history of turnover in the company's senior
financial management level.
Gibson's ratings are supported by the company's very strong brand
recognition and market share for guitar products, and diversified
product line within guitars and related music areas. The favorable
attributes help Gibson enter new product categories, penetrate
international markets, and charge a premium for many of its guitar
products like the Les Paul guitar.
Ratings could be lowered if for any reason, debt/EBITDA increases
to 6.0 times or higher, and EBITA/interest drops to one time or
lower. Pro foma EBITA/interest is 1.3 times.
Ratings are unlikely to be upgraded in the foreseeable future due
to Gibson's high leverage and weak operating margins and the risks
related to the continuing turnover of financial management. A
higher rating would require that Gibson demonstrate the ability
and willingness to maintain debt/EBITDA at 4.0 times or below as
well as a consolidated EBITA margin of at least 6%. The company's
pro forma EBITA margin is slightly under 3%. A higher rating would
also require that the company establish a longer-term track record
of management stability along with tangible evidence of the
strategic benefits of the company's expansion into consumer
electronics.
Gibson Brands, Inc. manufactures and markets acoustic and electric
guitars under the Gibson and Epiphone brand names and pianos under
the Baldwin brand name. Gibson also sells other stringed
instruments and instrument-related accessories such as amplifiers,
speakers, picks and straps. The company is headquartered in
Nashville, TN.
GREEN FIELD: Examiner's Report Critical of Founder
--------------------------------------------------
Steven A. Felsenthal, the court-appointed examiner in the Chapter
11 cases of Green Field Energy Services Inc., et al., was critical
of the founder of the oil-field services provider in his report.
Mr. Felsenthal was appointed as independent examiner to
investigate and prepare a report providing his factual and legal
conclusions respecting whether the estates hold valuable claims or
causes of action against any of the parties that would release if
the Chapter 11 Plan, including any plan revisions that represent a
consensual resolution of matters that would have otherwise been
covered in the Examiner's report, is confirmed and whether the
value being contributed by the parties to the restructuring
support agreement justifies granting those releases.
The Chapter 11 Examiner filed his report under seal on March 4,
but several parties, including the Official Committee of Unsecured
Creditors, objected to the filing of the report under seal.
Bankruptcy Judge Kevin Gross ordered the Examiner to file his
report in a redacted form as proposed by parties-in-interest.
The Examiner's report, according to Tom Corrigan, writing for
Daily Bankruptcy Review, is highly critical of the its founder
Michel Moreno and his management of the company. The report found
"genuine issues" with the "application of [Mr. Moreno's] business
judgment" and found Mr. Moreno, who stands accused by creditors of
improperly transferring a valuable part of Green Field's business
to another company he controls, to be "effectively on both sides"
of certain business transactions, Mr. Corrigan cited the papers
filed in court.
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
related that the Examiner concluded that an affiliate of Royal
Dutch Shell Plc was giving up enough to justify the releases under
the Plan. For insiders, the contributions were enough to justify
some, although not all, releases, the Examiner said.
A redacted version of the Examiner's Report is available for free
at http://bankrupt.com/misc/GREENFIELDexamreport.pdf
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-bk-12783).
The Debtors are represented by Michael R. Nestor, Esq., and Kara
Hammon Coyle, Esq., at Young Conaway Stargatt & Taylor, LLP, in
Wilmington, Delaware; and Josef S. Athanas, Esq., Caroline A.
Reckler, Esq., Sarah E. Barr, Esq., and Matthew L. Warren, Esq.,
at Latham & Watkins LLP, in Chicago, Illinois.
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.
Roberta A. DeAngelis, The U.S. Trustee for Region 3, appointed six
members to the official committee of unsecured creditors in the
Chapter 11 cases of Green Field Energy Services, Inc., et al.
Green Field's bankruptcy is being financed with a $30 million loan
from BG Credit Partners LLC and ICON Capital LLC.
The Bankruptcy Court authorized the United States Trustee for
Region 3 to appoint Steven A. Felsenthal, Esq., as examiner. He
has retained The Hogan Firm as his counsel.
U.S. Bankruptcy Judge Kevin Gross on April 23 confirmed the Second
Amended Joint Plan of Liquidation of Green Field Energy Services,
Inc. and its affiliated debtors. The Second Amended Plan was
filed March 14.
GREENSHIFT CORP: Retires $3.7 Million Convertible Debentures
------------------------------------------------------------
GreenShift retired convertible debentures with an aggregate
outstanding balance of $3,700,000, consisting of outstanding
principal and interest of $3,609,205 and $90,794, respectively,
effective on April 30, 2014. GreenShift made a cash payment of
$1,400,000 to retire the debentures.
The debt retirement is expected to reduce Greenshift's annual
interest charge by $215,000 (6 percent interest per year on the
$3,609,205 of principal being retired).
About Greenshift Corporation
Headquartered in New York, GreenShift Corporation develops and
commercializes clean technologies designed to integrate into and
leverage established production and distribution infrastructure to
address the financial and environmental needs of its clients by
decreasing raw material needs, facilitating co-product reuse, and
reducing waste and emissions.
Greenshift reported a net loss of $4.43 million on $15.49 million
of total revenue for the year ended Dec. 31, 2013, as compared
with net income of $2.46 million on $14.51 million of total
revenue in 2012. As of Dec. 31, 2013, the Company had $6.35
million in total assets, $49.07 million in total liabilities and a
$42.72 million total stockholders' deficit.
Rosenberg Rich Baker Berman & Company, in Somerset, NJ, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2013. The independent
auditors noted that the Company could be subject to default of its
senior debt obligation in 2014 if a condition to a forbearance
agreement that is not within the Company's control is not
satisfied. These conditions raise substantial doubt about its
ability to continue as a going concern.
GUIDED THERAPEUTICS: Incurs $4.2 Million Net Loss in 4th Quarter
----------------------------------------------------------------
Guided Therapeutics, Inc., reported a net loss attributable to
common stockholders of $4.21 million on $346,000 of contract and
grant revenue for the three months ended Dec. 30, 2013, as
compared with a net loss attributable to common stockholders of
$1.18 million on $1.01 million of contract and grant revenue for
the same period during the prior year.
For the year ended Dec. 30, 2013, the Company had a net loss
attributable to common stockholders of $10.39 million on $820,000
of contract and grant revenue as compared with a net loss
attributable to common stockholders of $4.35 million on $3.33
million of contract and grant revene during the prior year.
"We have begun to see momentum build with a growing number of key
opinion leading doctors in North America, Europe, Asia and Africa
as they conduct marketing clinical studies and evaluations of the
LuViva(R) Advanced Cervical Scan," said Gene Cartwright, chief
executive officer of Guided Therapeutics. "With any new medical
technology, customers are going to want to evaluate the product.
These evaluations lead to sales and that is our focus to grow the
business."
A copy of the press release is available for free at:
http://is.gd/iLNPHv
About Guided Therapeutics
Guided Therapeutics, Inc. (OTC BB and OTC QB: GTHP)
-- http://www.guidedinc.com/-- is developing a rapid and painless
test for the early detection of disease that leads to cervical
cancer. The technology is designed to provide an objective result
at the point of care, thereby improving the management of cervical
disease. Unlike Pap and HPV tests, the device does not require a
painful tissue sample and results are known immediately. GT has
also entered into a partnership with Konica Minolta Opto to
develop a non-invasive test for Barrett's Esophagus using the
LightTouch technology platform.
Guided Therapeutics disclosed a net loss of $4.35 million on $3.33
million of contract and grant revenue for the year ended Dec. 31,
2012, as compared with a net loss of $6.64 million on $3.59
million of contract and grant revenue in 2011.
UHY LLP, in Sterling Heights, Michigan, issued a "going concern"
qualification on the Company's consolidated financial statements
for the year ended Dec. 31, 2012, citing recurring losses from
operations and accumulated deficit that raise substantial doubt
about its ability to continue as a going concern.
Bankruptcy Warning
"Management may obtain additional funds through the private sale
of preferred stock or debt securities, public and private sales of
common stock, funding from collaborative arrangements, and grants,
if available, and believes that such financing will be sufficient
to support planned operations through the second quarter of 2014.
If sufficient capital cannot be raised by the end of the second
quarter of 2014, the Company has plans to curtail operations by
reducing discretionary spending and staffing levels, and
attempting to operate by only pursuing activities for which it has
external financial support, such additional NCI, NHI or other
grant funding. However, there can be no assurance that such
external financial support will be sufficient to maintain even
limited operations or that the Company will be able to raise
additional funds on acceptable terms, or at all. In such a case,
the Company might be required to enter into unfavorable agreements
or, if that is not possible, be unable to continue operations, and
to the extent practicable, liquidate and/or file for bankruptcy
protection," the Company said in its quarterly report for the
period ended Sept. 30, 2013.
GUITAR CENTER: Suspending Filing of Reports with SEC
----------------------------------------------------
Guitar Center Holdings, Inc., filed a Form 15 with the U.S.
Securities and Exchange Commission to voluntarily terminate the
registration of its 14.09 percent Senior PIK Notes due 2018
pursuant to Section 12(g) of the Securities Exchange Act of 1934.
As a result of the Form 15 filing, the Company is not anymore
obliged to file periodic repors with the SEC.
About Guitar Center
Guitar Center, Inc., headquartered in Westlake Village, Cal., is
the largest musical instrument retailer with 312 stores and a
direct response segment, which operates its Web sites. It
operates three distinct musical retail business - Guitar Center
(about 70% of revenue), Music & Arts (about 7% of revenue), and
Musician's Friend (its direct response subsidiary with 24% of
revenue). Total revenue is about $2 billion.
Guitar Center disclosed a net loss of $72.16 million in 2012, a
net loss of $236.93 million in 2011 and a $56.37 million net loss
in 2010.
Bankruptcy Warning
"If our cash flows and capital resources are insufficient to fund
our and Holdings' debt service obligations, we may be forced to
reduce or delay capital expenditures, sell assets or operations,
seek additional capital or restructure or refinance our and
Holdings' indebtedness. We cannot provide any assurance that we
would be able to take any of these actions, that these actions
would be successful and permit us to meet our and Holdings'
scheduled debt service obligations or that these actions would be
permitted under the terms of our and Holdings' existing or future
debt agreements. In the absence of such operating results and
resources, we could face substantial liquidity problems and might
be required to dispose of material assets or operations to meet
our and Holdings' debt service and other obligations. Our senior
secured credit facilities and the indentures that govern the notes
will restrict our ability to dispose of assets and use the
proceeds from the disposition. We may not be able to consummate
those dispositions or to obtain the proceeds which we could
realize from them and these proceeds may not be adequate to meet
any debt service obligations then due.
If we cannot make scheduled payments on our and Holdings' debt, we
will be in default and, as a result:
* our and Holdings' debt holders could declare all outstanding
principal and interest to be due and payable;
* the lenders under our senior secured credit facilities could
terminate their commitments to lend us money and foreclose
against the assets securing their borrowings; and
* we could be forced into bankruptcy or liquidation," according
to the Company's annual report for the period ended Dec. 31,
2012.
* * *
The Troubled Company Reporter, on March 27, 2014, reported that
Standard & Poor's Ratings Services lowered its corporate credit
rating on Westlake Village, California-based Guitar Center
Holdings Inc. to 'CC' from 'CCC+'. The outlook is negative.
As reported in the TCR on Feb. 28, 2011, Moody's Investors Service
affirmed Guitar Center's Caa2 Corporate Family Rating and the $622
million existing term loan rating of Caa1 due October 2014. The
Probability of Default Rating was revised to Caa2/LD from Caa2
while the Speculative Grade Liquidity assessment was changed to
SGL-2 from SGL-3. The rating outlook remains stable.
The Caa2/LD Probability of Default rating reflects Moody's view
that the extended deferral of interest on the Holdco notes
constitutes a distressed exchange under Moody's definition and
also anticipates that additional exchanges of this nature are
possible over the near term. The Limited Default designation was
prompted by the company's executed amendment of the HoldCo notes,
which allows for a deferral of 50% of the interest payments for 18
months. Moody's views this as a distressed exchange that provides
default avoidance. This LD designation applies to the proposed
follow-on amendment to defer the HoldCo note interest payments by
another six months. Subsequent to the actions, Moody's will
remove the LD designation and the PDR will be Caa2 going forward.
As reported by the TCR on May 30, 2013, Standard & Poor's Ratings
Services said it lowered its corporate credit rating on Westlake
Village, Calif.-based Guitar Center Holdings Inc. to 'CCC+' from
'B-'.
"Our rating action reflects our view that the company's financial
commitments are not sustainable in the long term given weaker than
expected performance over the past two quarters," said credit
analyst Mariola Borysiak.
HOSPITALITY STAFFING: Wants Plan Filing Extended to June 27
-----------------------------------------------------------
Hospitality Liquidation I, LLC formerly known as HSS Holding, LLC,
et al., ask the Hon. Brendan L. Shannon of the U.S. Bankruptcy
Court for the District of Delaware to further extend the period in
which the Debtors have exclusive right to file a Chapter 11 plan,
through and including June 27, 2014, and the period in which the
Debtors have the exclusive right to solicit acceptances of the
Plan, through and including Aug. 22, 2014.
On March 24, 2014, the Court extended the Exclusive Filing Period
to April 28, 2014, and the Exclusive Solicitation Period to
June 23, 2014.
Mark Minuti, Esq., at Saul Ewing LLP, the attorney for the
Debtors, says in a court filing dated April 18, 2014, that to
ensure that the Debtors' Chapter 11 Cases continue to progress in
an effective and efficient manner, the Debtors seek further
extensions of the Exclusive Periods so that they can determine a
course of action for these cases that best maximizes value for all
parties in interest while also continuing to transition the
Debtors' operations and address other pressing case issues.
According to Mr. Minuti, the size and complexity of the Debtors'
cases, together with the progress made to date, provide sufficient
cause for the requested extension of the Exclusive Periods. "As
of the Petition Date, the Debtors employed approximately 6,700
employees. Moreover, as of Nov. 25, 2013, the Debtors' books and
records reflected significant assets and liabilities. In addition
to size, the Debtors' cases are complex and have involved, inter
alia, significant insurance, customer and employee issues and
issues related to the sale and liquidation of substantially all of
the Debtors' assets. While the Debtors have addressed many of
these issues to date, certain critical issues remain and the
Debtors require additional time to focus on addressing these
issues, administering remaining assets and determining the best
course for these cases going forward," Mr. Minuti says.
A hearing on the requested extensions is set for May 28, 2019, at
10:30 a.m. (EST). Objections must be filed by May 9, 2014, at
9:00 p.m. (ST)
On April 18, the Debtors also filed a motion asking the Court to
further extend through and including June 23, 2014, the time
period within which the Debtors may remove civil actions.
As of the Petition Date, the Debtors were parties to certain
judicial proceedings in which various claims on behalf of or
against the Debtors were asserted. On Feb. 20, 2014, the Court
entered an order extending through and including April 22, 2014,
the time period within which the Debtors may remove actions.
Mr. Minuti says in the April 18 court filing that given the
demands on the Debtors' personnel and professionals, the Debtors
have a legitimate need for additional time to review the Actions
and determine whether the Actions should be removed. "In the
absence of such relief, the Debtors will be prejudiced with
respect to their right to remove Actions to this Court since they
would lose an important part of their overall ability to manage
litigation during these Chapter 11 cases, to the detriment to the
Debtors' estates, creditors and parties in interest. An extension
of the deadline to remove Actions to this Court will further
permit the Debtors' management and professionals to continue to
focus on the administration of these Chapter 11 Cases and provide
the Debtors with sufficient opportunity to evaluate the Actions to
determine whether removal is appropriate," Mr. Minuti states.
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, 2013. The sale closed on Jan. 24, 2014.
HOLYOKE GERIATRIC: Evidentiary Hearing on May 22 and 23
-------------------------------------------------------
Stephanie Barry, writing for The Republican, reported that Judge
Henry J. Boroff scheduled a two-day evidentiary hearing for May 22
and 23 in the midst of arguments over whether the Holyoke
Geriatric Authority may seek Chapter 11 bankruptcy protection as a
privately run entity. The Court is to determine what, if any,
control the city of Holyoke has over the Holyoke Geriatric
Authority.
The report said Steven Weiss, a lawyer for the city, argued the
authority falls under public control since the agency was
established by the state legislature in 1971, and all of its
employees are eligible for municipal health benefits and pensions.
In addition, six of its seven board members are appointed by the
mayor and City Council. Under the state legislation, the authority
also is prohibited from selling the property on Lower Holyoke Road
without city approval and has the power of eminent domain.
Louis Robin, arguing on behalf of the authority, countered that
the agency is an independent organization.
The report noted that the city has moved to foreclose on the
property and contends the authority owes Holyoke more than $5
million. The authority asserts the amount is closer to $1.5
million.
The report also said Judge Boroff also granted motions for the
authority to use "collateral cash" sources, such as Medicaid and
other public health payors, to make its payroll. Judge Boroff
also ruled the authority could free up funds to pay wages incurred
before the bankruptcy petition was filed.
Geriatric Authority of Holyoke, in Holyoke, Mass., filed for
Chapter 11 bankruptcy (Bankr. D. Mass. Case No. 14-30425) on April
24, 2014, in Springfield. Judge Henry J. Boroff presides over the
case. The Law Offices of Louis S. Robin, serves as counsel to the
Authority. It listed total assets of $5.85 million and
liabilities of $3.63 million. The petition was signed by Charles
F. Glidden, chair. A list of the 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/mab14-30425.pdf
INTERNATIONAL COMMERCIAL: Posts $1.6 Million Net Income in 2013
---------------------------------------------------------------
International Commercial Television Inc. filed with the U.S.
Securities and Exchange Commission its annual report on Form 10-K
disclosing net income of $1.64 million on $40.96 million of net
sales for the year ended Dec. 31, 2013, as compared with a net
loss of $550,448 on $22.92 million of net sales during the prior
year.
For the three months ended Dec. 31, 2013, the Company reported a
net loss of $272,097 on $9.80 million of net sales as compared
with a net loss of $424,115 on $10.13 million of net sales for the
same period during the prior year.
As of Dec. 31, 2013, the Company had $4.77 million in total
assets, $2.69 million in total liabilities and $2.07 million in
total shareholders' equity.
Kelvin Claney, Chairman and chief executive officer, stated,
"While 2013 was a record year for ICTV, we continue to look to
build upon our flagship product DermaWand and invest for future
growth. Our DermaWand success has brought us many additional
opportunities in the health and beauty sector. We have
successfully negotiated and structured several exclusive
agreements for new projects and products that we are very excited
about for 2014 and years to come."
EisnerAmper, LLP, in Jenkintown, Pennsylvania, did not issue a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2013. EisnerAmper
previously expressed substantial doubt about the Company's ability
to continue as a going concern following the Company's results for
the year ended Dec. 31, 2012. The independent auditors noted that
the Company's recurring losses from operations raise substantial
doubt about its ability to continue as a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/8wg5Pl
About International Commercial
Wayne, Pa.-based International Commercial Television Inc. sells
various consumer products. The products are primarily marketed
and sold throughout the United States and internationally via
infomercials.
* * *
This concludes the Troubled Company Reporter's coverage of
International Commercial until facts and circumstances, if any,
emerge that demonstrate financial or operational strain or
difficulty at a level sufficient to warrant renewed coverage.
INTERNATIONAL TEXTILE: Gorga Retires, Kunberger Appointed as CEO
----------------------------------------------------------------
Joseph L. Gorga, president and chief executive officer, has
announced his plans to retire from the Company effective May 31,
2014, having served as president and chief executive officer since
the Company's formation in 2004. In connection with Mr. Gorga's
announcement, the Board of Directors has appointed Kenneth T.
Kunberger as the Company's president and chief executive officer
effective May 1, 2014. Mr. Kunberger has served as the Company's
chief operating officer since December, 2011 and has also been
with the Company since its formation.
Mr. Gorga will assist Mr. Kunberger in a transitional capacity
through May 31. Mr. Gorga will also retire from the Board of
Directors on June 30, 2014.
Gorga's distinguished career in the industry, spanning over 40
years, included service with Milliken and Company in a variety of
executive roles and service as Chairman and CEO of CMI Industries
prior to joining Burlington Industries in 2002. He was named
president and CEO of Burlington upon its acquisition by WL Ross &
Co. in 2003. Gorga was named president and CEO and a member of
the Board upon ITG's formation in 2004. Throughout his career, he
has been a proponent and strong supporter of the textile industry,
having previously served as a director and vice chairman of the
American Textile Manufacturing Institute (ATMI) and chairman of
the National Textile Association (NTA).
"Joe was instrumental to the Company in its formation, integration
activities, international development and transition to its role
today as a preeminent supplier of technology and innovation in the
industry supply chain," said Wilbur L. Ross, Chairman of ITG's
Board of Directors. "With his leadership during these past ten
years, ITG is now positioned for continued growth in many key
areas. I appreciate Joe's contributions, leadership, and his
development of a strong management team poised for the
opportunities we have going forward. I know that everyone within
the ITG organization and in the Greensboro community will join me
in wishing him well."
Kunberger joined Burlington Industries in 1998, having previous
experience with Liz Claiborne in New York, where he held a number
of management positions in sales and marketing, merchandising and
operations, and with VF Corporation, where he held various
executive positions for VF Licensed Jeanswear and Marith' et
Francois Girbaud, a fashion jeans company. At Burlington, Mr.
Kunberger served in various executive capacities in its
sportswear, denim, and apparel businesses.
Upon the formation of ITG, Mr. Kunberger served in a number of
executive positions with increasing levels of responsibility.
From his position as president of Burlington WorldWide, he was
subsequently named president of ITG's Apparel and Specialty
Fabrics Group, where he assumed responsibility for the Cone Denim
business and its operations in the U.S., Mexico, and China. He
was subsequently named chief operating officer.
In addition to his duties to ITG, Mr. Kunberger also serves on the
Industry Advisory Board of the North Carolina State University
School of Textiles.
"Ken has made many contributions to the Company in his previous
roles, and we believe he is the right person to lead ITG as it
moves to expand its brand, product, and customer bases," said Joe
Gorga. "Ken's past experiences and skills, along with his passion
for the Company's businesses and products, will be invaluable as
ITG continues to build upon its heritage as the preeminent
supplier of innovative products in its various marketplaces."
Said Wilbur L. Ross, "We are very pleased to have Ken as President
and CEO and look forward to his leadership as ITG embarks on the
many opportunities it has as the product and innovation leader in
its marketplaces. We value his past contributions to the Company,
to Burlington, and to Cone Denim, the leadership he has provided
in the growth of the denim business, and are excited about the
possibilities for the future as he leads the Company into the next
chapter."
In connection with his appointment, the Company and Mr. Kunberger
have entered into a new employment agreement, effective as of
May 1, 2014, pursuant to which Mr. Kunberger will be entitled to:
(i) a minimum annual base salary of $575,000;
(ii) participate in the Company's various annual or long-term
incentive bonus plans, with a target annual incentive
opportunity under the Company's annual incentive plan of
70 percent of his base salary, and with a minimum
guaranteed payment under the 2014 annual incentive plan of
$250,000; and
(iii) to receive grants of equity awards in accordance with the
provisions of any Company stock plan.
Additional information is available for free at:
http://is.gd/nVpewU
About International Textile
International Textile Group, Inc., is a global, diversified
textile manufacturer headquartered in Greensboro, North Carolina,
with current operations principally in the United States, China,
Mexico, and Vietnam. ITG's long-term focus includes the
realization of the benefits of its global expansion, including
reaching full production at ITG facilities in China and Vietnam,
and continuing to seek other strategic growth opportunities.
International Textile reported a net loss attributable to common
stock of the Company of $10.91 million in 2013, as compared with a
net loss attributable to common stock of the Company of $91.45
million in 2012. As of Dec. 31, 2013, the Company had $317.32
million in total assets, $404.86 million in total liabilities and
a $87.53 million total stockholders' deficit.
LIGHTSQUARED INC: Lawyer Discredits Ergen Testimony
---------------------------------------------------
Chris Nolter, writing for The Deal, reported that as closing
arguments opened in a hearing on LightSquared Inc.'s
reorganization plan, lawyers for the bankrupt wireless spectrum
company attacked the credibility satellite TV billionaire Charlie
Ergen, who is the largest creditor in the a case.
Joseph Checkler, writing for The Wall Street Journal, reported
that after two days of closing arguments in Lightsquared's
confirmation hearing, Judge Shelley Chapman of the U.S. Bankruptcy
Court for the Southern District of New York said she'll decide on
May 8 whether to approve the restructuring and also will rule in
the separate trial over whether Mr. Ergen improperly purchased the
company's debt.
"Mr. Ergen's testimony cannot be believed," said debtor counsel
Andrew Leblanc of Milbank, Tweed, Hadley & McCloy LLP, the Deal
cited.
Dish Network Corp. chairman Ergen, who holds more than $1 billion
in secured claims including interest, is the sole objector to the
reorganization of Philip Falcone-backed LightSquared, the Deal
related.
Leblanc told the court that Ergen impeached himself 27 times
during testimony earlier in 2014 by disagreeing with his
deposition before the trial, the Deal further related.
LightSquared and supporting creditors are trying to convince Judge
Shelley Chapman of the U.S. Bankruptcy Court for the Southern
District in New York that the debtor should be able to give Ergen
different compensation for his secured claims than other creditors
holding secured debt, the Deal said. The plan supporters also
want Chapman to designate, or disqualify, Ergen's vote.
About LightSquared Inc.
LightSquared Inc. and 19 of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on
May 14, 2012, to resolve regulatory issues that have prevented it
from building its coast-to-coast integrated satellite 4G wireless
network.
LightSquared had invested more than $4 billion to deploy an
integrated satellite-terrestrial network. In February 2012,
however, the U.S. Federal Communications Commission told
LightSquared the agency would revoke a license to build out the
network as it would interfere with global positioning systems used
by the military and various industries. In March 2012, the
Company's partner, Sprint, canceled a master services agreement.
LightSquared's lenders deemed the termination of the Sprint
agreement would trigger cross-defaults under LightSquared's
prepetition credit agreements.
LightSquared and its prepetition lenders attempted to negotiate a
global restructuring that would provide LightSquared with
liquidity and runway necessary to resolve its issues with the FCC.
Despite working diligently and in good faith, however,
LightSquared and the lenders were not able to consummate a global
restructuring on terms acceptable to all interested parties.
Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to
the Debtors. Alvarez & Marsal North America, LLC, is the
financial advisor. Kurtzman Carson Consultants LLC serves as
claims and notice agent.
LIONS GATE: S&P Revises Outlook to Positive & Affirms 'B+' CCR
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Santa
Monica, Calif.-based Lions Gate Entertainment Corp. to positive
from stable. At the same time, S&P affirmed its ratings on the
company, including the 'B+' corporate credit rating.
The outlook revision reflects Lions Gate's prospects for
increasing earnings stability for the next few years. "We believe
the company's strategy of focusing on selected larger budget film
franchises, moderate-cost productions, low cost film acquisitions,
and foreign output deals, while also pre-licensing certain rights
to reduce the financial risk to the company, improves visibility
into its future earnings," said Standard & Poor's credit analyst
Naveen Sarma.
"Our assessment of the business risk profile as "weak" (based on
our criteria) stems from Lions Gate's ongoing exposure to the
volatility of the motion picture industry, resulting from the high
upfront costs, timing, and uncertain success of film releases. We
view the more stable revenue and cash flow from its growing TV
production segment (15% of consolidated revenues), longer-term
upside from the growth of digital distribution, and the growing
cash flow and improving margins from its expanding library, as
modestly tempering feature film risks. We assess Lions Gate's
management as "fair" under our criteria," S&P noted.
"Our assessment of the financial risk as "aggressive" (based on
our criteria) reflects Lions Gate's improved discretionary cash
flow and leverage as a result of the success of its Hunger Games
franchise and its risk mitigation strategy. It also reflects the
cash flow volatility and formidable upfront cash requirements
inherent in the film studio business," S&P said.
LPL HOLDINGS: Moody's Affirms Ba2 Corp. Family & Sr. Sec. Rating
----------------------------------------------------------------
Moody's Investors Service confirmed LPL Holdings, Inc.'s (LPL) Ba2
corporate family and senior secured bank credit facility ratings.
The rating outlook is stable. The action concludes the review for
downgrade that was initiated on February 13, 2014.
Ratings Rationale
LPL's rating is supported by its strong, scalable franchise as the
largest independent financial advisory firm in the US. Its size,
strong revenue base (two-thirds of which is recurring in nature)
and predominantly variable cost structure produces stable gross
margins.
The company's share repurchase and dividend payment activity has
been Moody's main concern regarding LPL's ability to maintain its
credit strength and the reason for Moody's initiating the review
for downgrade. Management is committed to determining shareholder
distributions based on a defined allocation model of a portion of
the company's discretionary cash flow (cash from operations less
debt principal payments) and maintaining a baseline of at least
$200 million of cash available for corporate use. Moody's
confirmed the Ba2 ratings because adherence to this plan should
continue to result in acceptable debt coverage metrics for the
current rating level and the maintenance of a sufficient corporate
cash buffer to manage a reasonable amount of unanticipated cash
outflows, such as regulatory, compliance or legal costs.
Increased cash flows could arise from improved profit margins.
However, based on the company's past actions, Moody's consider it
likely that most of this additional cash flow, should it arise,
would be distributed to shareholders rather than retained in the
business. Absent a change to the implementation of the capital
management plan that would distribute less to shareholders and
retain more cash in order to substantially reduce the company's
$760 million deficit of tangible common equity (at March 2014),
improved profit margins and cash flows would be unlikely to affect
Moody's current view of the company's creditworthiness.
A developing challenge for the company is improving its risk
management and regulatory compliance processes to align with its
past growth. Although it has already made progress, particularly
by investing in experienced and qualified personnel, the
maturation of the requisite oversight and control functionality
necessary for a large company operating in this sector will take
time and ongoing oversight and investment. At the current rating
level, Moody's expect the company to continue to focus on
remediation and improvements in this area, given its large size,
breadth of product offerings and past issues.
The stable rating outlook reflects Moody's expectations that LPL
will continue to report stable and potentially increased profit
margins and will adhere to its capital management plan, thereby
maintaining its debt leverage at an appropriate level for its
existing rating. Moody's expect that any significant changes to
the capital management plan will be infrequent and give full
consideration to the interests of creditors.
What Could Change the Rating -- Up
The retention of improved cash flows from stronger profitability
that would substantially reduce the company's deficit of tangible
common equity could cause upward rating pressure. The
demonstration of a rigorous, well-functioning risk management and
regulatory compliance infrastructure would be a necessary pre-
requisite for an upgrade.
What Could Change the Rating -- Down
A modification of the capital management plan that resulted in a
deterioration in debt leverage or corporate cash falling below
$200 million would likely result in a downgrade. The announcement
of a significant debt-financed acquisition would also be viewed
negatively. A significant failure in technology, cost control or
regulatory compliance would also give rise to downward rating
pressure.
LPL is a wholly-owned subsidiary of publicly-traded LPL Financial
Holdings Inc. and provides an integrated platform of brokerage and
investment advisory services to independent financial advisors
that lack the support services to execute on their clients'
investment activities. It also provides services to financial
advisors at financial institutions and to those servicing high net
worth clients. It reported net revenue of $4,141 million and net
income of $182 million for the year ended December 31, 2013.
LYFE COMMUNICATIONS: Delays 2013 Form 10-K
------------------------------------------
LYFE Communications, Inc., filed with the U.S. Securities and
Exchange Commission a Notification of Late Filing on Form 12b-25
with respect to its annual report on Form 10-K for the year ended
Dec. 31, 2013. The Company said it is in the process of
completing its financial statement review, and believes that the
subject Annual Report will be available for filing during the
extension period.
About LYFE Communications
South Jordan, Utah-based LYFE Communications, Inc.'s business is
to develop, deploy, and operate next generation media and
communications network based services to single-family, multi-
family, high-rise resort and hospitality properties.
LYFE Communications incurred a net loss of $1.74 million on
$531,531 of revenue for the year ended Dec. 31, 2012, as compared
with a net loss of $3.88 million on $621,830 of revenue for the
year ended Dec. 31, 2011. The Company's balance sheet at June 30,
2013, showed $1.16 million in total assets, $3.68 million in total
liabilities and a $2.52 million total stockholders' deficit.
HJ & Associates, LLC, in Salt Lake City, Utah, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2012. The independent auditors noted
that the Company has suffered losses since inception. The Company
has not established operations with consistent revenue streams and
has a working capital deficit. These factors raise substantial
doubt about the Company's ability to continue as a going concern.
MAGNOLIA SCIENCE: S&P Assigns 'BB' Rating to $6.06MM Revenue Bonds
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' long-term
rating to the California School Finance Authority's $6.06 million
series 2014A and taxable series 2014B school facility revenue
bonds issued on behalf of MPM Sherman Way LLC for the Magnolia
Science Academy-1 (MSA-1), Reseda Project. The outlook is
positive.
"The 'BB' rating is based on our view of Magnolia Educational and
Research Foundation's group credit profile as outlined in Standard
& Poor's Group Ratings Methodology and MSA-1's highly strategic
status to it," said Standard & Poor's credit analyst Debra Boyd.
"Although MSA-1's stand-alone credit profile is one notch higher
than that of the group credit profile assigned to the foundation,
the long-term bond rating is capped at 'BB' to reflect the risk
that the group could draw support from MSA-1," added Ms. Boyd.
The rating only applies to this transaction and does not apply to
the foundation (MERF). MERF is a charter school management
organization, which founded and operates MSA-1.
The positive outlook reflects the improvement of MERF's operations
and financial resources based on one year of audited data and
fiscal 2014 projections supported by nine months of unaudited
financial reports, which S&P expects to be realized in the fiscal
2014 audit.
Bond proceeds will be secured by MSA-1 revenues with state
payments intercepted each month by the trustee to pay debt service
on the bonds.
MASON COPPELL: Sells Estrella, et al., Assets for $16.1 Million
---------------------------------------------------------------
Mason Coppell OP, LLC, et al., obtained authority from the U.S.
Bankruptcy Court for the Northern District of Texas, Dallas
Division, to sell substantially all of their assets for a total of
$16.1 million, consisting of $4.0 million for so-called facility
assets and $12.1 million for the 142-bed nursing home facility
commonly known as Estrella Oaks Rehabilitation Care Center, in
Georgetown, Texas.
At the closing of the sale, proceeds of the sale of the real
property in the amount of $12.1 million, less adjustments,
required U.S. Trustee fees, and required administrative expenses,
will be paid to Oxford Finance, LLC, which is owed almost $16
million on a term loan and revolving credit.
The Court overruled objections, including those raised by the
County of Williamson, Texas, and Broadmore Health Realty, Ltd.,
and Corr Health Realty, LLC, as landlords, to the sale of
substantially all of the Debtors' assets. The Official Committee
of Unsecured Creditors also raised an objection, stating that it
is concerned over the allocation of accounts received primarily
related to the operations transfer agreement. The Committee said
it is involved in discussions with the Debtors and the proposed
new operator regarding its concern.
Debtor Mason Friendswood OP, LLC, is separately seeking authority
from the Bankruptcy Court to sell the Friendship Haven Health and
Rehabilitation Center in order to ensure uninterrupted and
continued care at the Facility. The Debtor said it is unable to
continue its operations at the Facility and its only alternative
to a shutdown is to sell and transfer the operations on an
emergency basis to Friendswood TRS, LLC, an affiliate of the
Landlord, Friendswood SNF, LLC. The Landlord will assume certain
obligations and waive and release its claim against the estates
and the Debtor's principal.
To finance their operations and pay off debts, the Debtors
received final authority from the Court to obtain postpetition
loans from Oxford Finance up to the sum of (x) Net Availability,
plus (y) $1,467,000, and use cash collateral securing their
prepetition debts. Debtor Mason Mesquite OP, LLC, also received
authority to obtain financing in the amount of approximately
$49,500 from Pharmacy Corporation of America, and $137,500 from
RehabCare Group East, Inc., for the continued operation of the
Edgewood Rehabilitation and Care Center.
Joe E. Marshall, Esq., Timothy A. Million, Esq., and Thomas D.
Berghman, Esq., at Munsch Hard Kopf & Harr, P.C., in Dallas,
Texas, represent the Debtors, except for Georgetown Realco, LLC.
Mark E. Andrews, Esq., George H. Tarpley, Esq., and Aaron M.
Kaufman, Esq., at Cox Smith Matthews Incorporated, in Dallas,
Texas, represent the Committee.
Lee Gordon, Esq., at Mccreary, Veselka, Bragg & Allen, P.C., in
Round Rock, Texas, is attorney for Williamson County.
Scott A. Ritcheson, Esq., at Ritcheson, Lauffer & Vincent, P.C.,
in Tyler, Texas, serves as attorneys for Broadmore Health Realty,
Ltd. and Corr Health Realty, LLC.
About Mason Coppell
Mason Coppell OP, LLC, Mason Georgetown OP, LLC, Mason Mesquite
OP, LLC, and Mason Round Rock OP, LLC operate five skilled nursing
homes in Texas. Mason Georgetown RealCo, LLC, owns the real estate
and building for the operations of Mason Georgetown. They
initiated the Chapter 11 cases to effectuate a prompt transfer of
their assets and operations to preserve patient safety and any
potential value for creditors.
Mason Coppell OP, LLC, et al., filed Chapter 11 bankruptcy
petitions (Bankr. N.D. Tex. Case Nos. 14-31327 to 14-14-31334) on
March 18, 2014. Judge Stacey Jernigan presides over the cases.
The Debtors estimated assets of at least $10 million and debts of
at least $10 million.
The Debtors, except Mason Georgetown Realco, are represented by
Joe E. Marshall, Esq., Thomas D. Berghman, Esq., and Timothy A.
Million, Esq., at Munsch Hardt Kopf & Harr, P.C. Georgetown
Realco is represented by Jonathan S. Covin, Esq., and Shayla L.
Friesen, Esq., at Wick Phillips Gould & Martin, LLP.
Deloitte Transactions and Business Analytics, LLP, acts as the
Debtors' restructuring advisor with Louis Robichaux serving as
chief restructuring officer.
On March 28, 2014, the United States Trustee appointed an
Unsecured Creditors' Committee in the cases. To date there has
been no request made for the appointment of a trustee or examiner.
A patient care ombudsman has not yet been appointed. However, the
Court has scheduled a show cause hearing on April 15 to consider
the appointment of an Ombudsman.
Counsel for the Committee is Cox Smith Mathews Incorporated's Mark
Andrews, Esq.
Counsel for Oxford is Vedder Price P.C.'s Jon Aberman, Esq.
Counsel for THI of Baltimore, Inc., the stalking horse bidder for
the Debtors' assets, is Arent Fox LLP's George P. Angelich, Esq.
MAUI LAND: Incurs $909,000 Net Loss in First Quarter
----------------------------------------------------
Maui Land & Pineapple Company, Inc., filed with the U.S.
Securities and Exchange Commission its quarterly report on Form
10-Q disclosing a net loss of $909,000 on $2.46 million of total
operating revenues for the three months ended March 31, 2014, as
compared with a net loss of $1.81 million on $2.62 million of
total operating revenues for the same period in 2013.
The Company's balance sheet at March 31, 2014, showed $53.37
million in total assets, $81.20 million in total liabilities and a
$27.82 million stockholders' deficiency.
A copy of the Form 10-Q is available for free at:
http://is.gd/Luqj6M
On April 25, 2014, Maui Land entered into a Fifth Modification
Agreement with Wells Fargo Bank, National Association. The Fifth
Modification amends the terms of the Company's $32.7 million
revolving line of credit agreement with Wells Fargo by, among
other things, extending the maturity date from May 1, 2014, to
Aug. 1, 2016, and reducing the required minimum liquidity from $4
million to $3 million.
On April 25, 2014, the Company entered into a Third Amendment to
Loan Agreement with American AgCredit, FLCA. The Third Amendment
amends the terms of the Company's $20 million term loan agreement
with AgCredit by, among other things, extending the maturity date
from May 1, 2014, to Aug. 1, 2016, and reducing the required
minimum liquidity from $4 million to $3 million. In addition, the
Third Amendment requires a mandatory principal repayment of $3
million by May 1, 2015, and an additional $2 million by May 1,
2016.
A copy of the Fifth Modification Agreement is available at:
http://is.gd/54Dtlr
A copy of the Third Amendment to Loan Agreement is available at:
http://is.gd/GXTSAM
About Maui Land & Pineapple Co.
Maui Land & Pineapple Company, Inc. (NYSE: MLP) --
http://mauiland.com/-- develops, sells, and manages residential,
resort, commercial, and industrial real estate. The Company owns
approximately 23,000 acres of land on Maui and operates retail,
utility operations, and a nature preserve at the Kapalua Resort.
The Company's principal subsidiary is Kapalua Land Company, Ltd.,
the operator and developer of Kapalua Resort, a master-planned
community in West Maui.
Maui Land reported a net loss of $1.16 million on $15.21 million
of total operating revenues for the year ended Dec. 31, 2013, as
compared with a net loss of $4.60 million on $13.57 million of
total operating revenues in 2012. As of Dec. 31, 2013, the
Company had $53.75 million in total assets, $80.98 million in
total liabilities and a $27.23 million stockholders' deficiency.
Deloitte & Touche LLP, in Honolulu, Hawaii, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2013. The indepdendent auditors noted
that the Company's recurring negative cash flows from operations
and deficiency in stockholders' equity raise substantial doubt
about the Company's ability to continue as a going concern.
MERCANTILE BANCORP: June 26 Hearing on Confirmation of Plan
-----------------------------------------------------------
The Bankruptcy Court will convene a hearing on June 26, 2014, at
4:00 p.m., to consider the confirmation of Mercantile Bancorp,
Inc.'s First Amended Plan of Liquidation dated May 1.
By order dated May 1, 2014, the Court approved the First Amended
Disclosure Statement for the Debtor. The Disclosure Statement
order authorizes the Debtor to solicit votes to accept or reject
the Debtor's First Amended Plan.
The Court also approved this schedule in relation to the Plan
confirmation:
Event Date
----- ----
Voting Record Date May 1
Solicitation Date May 12
Deadline to Object to Claims for Voting Purposes June 9
Rule 3018(a) Motion Deadline June 11
Voting Deadline June 16
Confirmation Objection Deadline June 19 at
4:00 p.m.
Debtor's Deadline to Reply to Objections June 24
According to the First Amended Disclosure Statement, the Plan will
facilitate the liquidation of the Debtor's estate and distribution
of the assets to holders of allowed claims.
The Plan also provides for this treatment of claims:
Class/Type of Claim or Plan Treatment of Class Projected
Equity Interest ----------------------- Recovery
---------------------- Under Plan
----------
UNCLASSIFIED CLAIMS
-------------------
Administrative Claims Paid in full in Cash on 100%
the Initial Distribution
Date or as soon thereafter
as is practical
Priority Tax Claims Paid in full in Cash on 100%
the Initial Distribution
Date or as soon thereafter
as is practical
Other Priority Claims Paid in full in Cash on 100%
the Initial Distribution Date
or as soon thereafter as is
practical
CLAIMS AGAINST AND INTERESTS IN THE DEBTOR
------------------------------------------
Class 1 - General Paid distributions from 3.8% - 2.5%
Unsecured Claims all Cash funds remaining
in the estate
Class 2 - Equity Interests All equity interests in the 0%
Debtor will be canceled
A copy of the Disclosure Statement is available for free at
http://bankrupt.com/misc/MERCANTILEBANCORP_1stAds.pdf
About Mercantile Bancorp
Mercantile Bancorp -- http://www.mercbanx.com/-- is a Quincy,
Illinois-based bank holding company with wholly owned subsidiaries
consisting of one bank in Illinois and one each in Kansas and
Florida, where the Company conducts full-service commercial and
consumer banking business, engages in mortgage banking, trust
services and asset management, and provides other financial
services and products. The Company also operated Mercantile Bank
branch offices in Missouri and Indiana.
On Aug. 10, 2011, the Illinois Division of Banking released a
Consent Order that Mercantile Bank, the Federal Deposit Insurance
Corporation, and the Division entered into as of July 28, 2011.
Under the Order, Mercantile Bank will cease operating with all
money transmitters and currency businesses providing brokerage,
sale or exchange of non-United States currency for deposit
customers. Furthermore, Mercantile Bank may not enter into a new
line of business without the prior written consent of the FDIC and
the Division.
Mercantile Bancorp filed a Chapter 11 petition (Bankr. D. Del.
Case No. 13-11634) on June 27, 2013. The petition shows assets
and debt both exceeding $50 million. Liabilities include
$61.9 million owing on junior subordinated debentures. Mercantile
stopped paying interest on the debentures in 2009, since then
running up $14 million in unpaid interest.
Stuart M. Brown, Esq. at DLA Piper LLP (US), in Wilmington,
Delaware; and Richard A. Chesley, Esq., Kimberly D. Newmarch,
Esq., and Aaron M. Paushter, Esq., at DLA Piper LLP (US), in
Chicago, Illinois, are the attorneys for the Debtor.
A three-member official committee of unsecured creditors was
appointed by the U.S. Trustee.
An official committee of trust preferred securities holders was
also appointed by the U.S. Trustee. The TruPS Committee is
represented by Domenic E. Pacitti, Esq., at Klehr Harrison Harvey
Branzburg LLP, in Wilmington, Delaware; Morton R. Branzburg, Esq.,
at Klehr Harrison Harvey Branzburg LLP, in Philadelphia,
Pennsylvania; David R. Seligman, P.C., Esq., and Jeffrey W.
Gettleman, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois;
and Joseph Serino Jr., P.C., Esq., and John P. Del Monaco, Esq.,
at Kirkland & Ellis LLP, in New York.
In October 2013, the Bankruptcy Court authorized Mercantile
Bancorp, Inc.'s sale of its shares in Mercantile Bank and the
related trademark for Mercantile Bank's "M" Logo. Mercantile
Bancorp entered into a stalking horse purchase agreement with
United Community Bancorp Inc., under which the Purchaser will pay
$22,277,000, less all amounts due and owing by the Bank to the
Federal Deposit Insurance Corporation and all broker's fees.
MERRIMACK PHARMACEUTICALS: Incurs $27.8 Million Net Loss in Q1
--------------------------------------------------------------
Merrimack Pharmaceuticals, Inc., reported a net loss of $27.75
million on $13.03 million of collaboration revenue for the three
months ended March 31, 2014, as compared with a net loss of $28.32
million on $14.65 million of collaboration revenue for the same
period in 2013.
As of March 31, 2014, the Company had $164.98 million in total
assets, $230.77 million in total liabilities and a $65.96 million
total stockholders' deficit.
A copy of the press release is available for free at:
http://is.gd/sHo0pz
Merrimack announced in a separate release that in a Phase 3 study
in patients with metastatic pancreatic cancer, the combination of
MM-398 with 5-fluorouracil (5-FU) and leucovorin achieved an
overall survival of 6.1 months, a 1.9 month improvement over the
4.2 month survival demonstrated by the control arm of 5-FU and
leucovorin. The NAPOLI-1 study was completed in patients with
metastatic pancreatic cancer who previously received gemcitabine-
based therapy. The primary log-rank analysis of overall survival
was statistically significant (p=0.012) with a corresponding
hazard ratio of 0.67. A statistically significant advantage for
progression free survival was also observed in the combination
arm. The most common Grade 3 or higher adverse events in the
combination arm were neutropenia, fatigue, diarrhea and vomiting.
The arm evaluating MM-398 as a monotherapy did not meet the
statistical endpoint. The hazard ratio for overall survival in
the monotherapy arm was 0.99 with a corresponding p-value of
0.942. The study has been accepted for oral presentation at the
European Society for Medical Oncology (ESMO) World Conference on
Gastrointestinal Cancer being held in Barcelona, Spain on
June 25-28, 2014. A copy of the press release is available at:
http://is.gd/zPoPok
About Merrimack
Cambridge, Mass.-based Merrimack Pharmaceuticals, Inc., a
biopharmaceutical company discovering, developing and preparing to
commercialize innovative medicines consisting of novel
therapeutics paired with companion diagnostics. The Company's
initial focus is in the field of oncology. The Company has five
programs in clinical development. In it most advanced program,
the Company is conducting a pivotal Phase 3 clinical trial.
Merrimack reported a net loss of $130.68 million in 2013, a net
loss of $91.75 million in 2012 and a net loss of $79.67 million in
2011. The Company's balance sheet at Dec. 31, 2013, showed
$192.41 million in total assets, $235.54 million in total
liabilities, $337,000 in non-controlling interest and a $43.46
million total stockholders' deficit.
METRO AFFILIATES: To Release Funds From Escrow to Pay Claims
------------------------------------------------------------
Bankruptcy Judge Sean H. Lane authorized Metro Affiliates, Inc.,
et al., to release $2,895,041 from escrow to satisfy certain
existing secured claims.
The Debtors will remit the amounts to the PMM lenders from the
escrowed proceeds:
GECC $819,275
People's $1,800,400
CBT Inc. $935,465
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. In its schedules, Metro
Affiliates disclosed $14,438,351 in total assets and $163,562,007
total liabilities.
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.
The Joint Chapter 11 Plan of Liquidation filed by Metro
Affiliates, Inc. and its debtor affiliates embodies a global
settlement among the Debtors, the Creditors Committee, Wells Fargo
and Wayzata for a fair allocation of the Debtors' remaining
assets. Wayzata holds a substantial majority of the Debtors'
Notes. Among other things, the Settlement provides that proceeds
of the Noteholders' Collateral will be used to pay certain
administrative expenses.
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. Trustee 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.
MID-SOUTH BUSINESS: Case Summary & Largest Unsecured Creditors
--------------------------------------------------------------
Debtor affiliates that filed for separate Chapter 11 bankruptcy
petitions:
Debtor Case No.
------ --------
Thomas L Windham, MD & Linda T 14-11544
Windham
TLW Properties, LLC 14-11545
Mid-South Business Associates, LLC 14-11546
P O Box 1204
Oxford, MS 38655
North Mississippi Spine Center, Inc. 14-11547
P.O. Box 1204
Oxford, MS 38655
Chapter 11 Petition Date: April 21, 2014
Court: United States Bankruptcy Court
Northern District of Mississippi (Aberdeen)
Judge: Hon. Jason D. Woodard
Debtors' Counsel: Robert Gambrell, Esq.
GAMBRELL & ASSOCIATES, PLLC
101 Ricky D Britt Blvd.
Suite 3, Oxford, MS 38655
Tel: 662-281-8800
Email: rg@ms-bankruptcy.com
Estimated Estimated
Assets Liabilities
---------- -----------
Mid-South Business Associates $1MM-$10MM $1MM-$10MM
North Mississippi Spine Center $100K-$500K $1MM-$10MM
The petitions were signed by Thomas L Windham, MD, managing
member.
A. A list of Mid-South Business Associates' three largest
unsecured creditors is available for free at:
http://bankrupt.com/misc/msnb14-11546.pdf
B. A list of North Mississippi Spine Center's six largest
unsecured creditors is available for free at:
http://bankrupt.com/misc/msnb14-11547.pdf
MINUTEMAN SPILL RESPONSE: Trucking Firm Files Bankruptcy
--------------------------------------------------------
Minuteman Spill Response, Inc., filed for Chapter 11 bankruptcy on
April 18 in U.S. Bankruptcy Court for the Middle District of
Pennsylvania.
Minuteman Spill, part of Minuteman Environmental Services,
provides emergency response services to a variety of industries in
the Mid-Atlantic region and acts as a liaison with local, state
and federal government agencies and first responders.
John Beauge, writing for PennLive.com, reported that the
bankruptcy filing was in response to M&T Bank on March 28 seeking
full payment of three loans totaling $4,669,164 plus late charges.
According to the report, the Company was raided in May 2013 by
state attorney general's agents after a statewide grand jury in
Pittsburgh issued a search warrant. No charges have been filed
against Minuteman or company president Brian J. Bolus, and the
attorney general's office refuses to discuss the status of the
investigation.
The report related that Mr. Bolus said Minuteman was able to
overcome the negative impact of the raid but he accused M&T, its
primary lender, of refusing to cooperate during this "difficult
time" and of taking steps that aggravated the situation. To halt
the bank's interference with Minuteman's operations it was
necessary to seek protection through bankruptcy court, he said.
The company, incorporated in 2001, is financially stable and it is
not going out of business, he added. Attempts to negotiate with
various creditors have failed and the only option was to file for
bankruptcy protection, he claimed.
The report also said Bankruptcy Judge John J. Thomas, with M&T's
concurrence, has signed an order allowing Minuteman to spend until
May 5 up to $57,000 for payroll and related expenses, $30,500 for
fuel, $42,900 for landfill fees and $20,000 for miscellaneous
costs.
Francis Scarcella, writing The Daily Item, reported that Mr. Bolus
said in a written statement that business operations continue,
with a bright future ahead. "For 13 years, Minuteman Spill
Response has provided valuable environmental services to our
customers, well-paying jobs to our employees and support to the
communities in which we operate," he wrote. "We look forward to
continuing to do so for many more years."
Minuteman Spill Response, Inc. a trucking company based in Milton,
Pennsylvania, filed for Chapter 11 bankruptcy (Bankr. M.D. Pa.
Case No. 14-01825) on April 18, 2014, in Williamsport. Judge John
J. Thomas presides over the case. Robert L. Knupp, Esq., at
Smigel, Anderson & Sacks, LLP, serves as the Debtor's counsel.
The Company estimated $1 million to $10 million in both assets and
liabilities. The petition was signed by Brian J. Bolus,
president. A list of the Debtor's 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/pamb14-01825.pdf
MOLA INC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: Mola, Inc.
2957 East 46th Street
Vernon, CA 90058
Case No.: 14-18682
Chapter 11 Petition Date: May 5, 2014
Court: United States Bankruptcy Court
Central District of California (Los Angeles)
Debtor's Counsel: Jaenam J Coe, Esq.
LAW OFFICES OF JAENAM COE PC
3731 Wilshire Bl Ste 910
Los Angeles, CA 90010
Tel: 213-389-1400
Fax: 213-387-8778
Email: coelaw@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Myong Hun Kim, president.
The Debtor did not file a list of its largest unsecured creditors
when it filed the petition.
MOTORCAR PARTS: Wellington Stake at 2.9% as of Dec. 31
------------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, Wellington Trust Company, NA, disclosed that
as of Dec. 31, 2013, it beneficially owned 430,594 shares of
common stock of Motorcar Parts of America, Inc., representing 2.97
percent of the shares outstanding. A copy of the regulatory
filing is available for free at http://is.gd/MEfu4t
About Motorcar Parts
Torrance, California-based Motorcar Parts of America, Inc.
(Nasdaq: MPAA) is a remanufacturer of alternators and starters
utilized in imported and domestic passenger vehicles, light trucks
and heavy duty applications. Motorcar Parts of America's products
are sold to automotive retail outlets and the professional repair
market throughout the United States and Canada, with
remanufacturing facilities located in California, Mexico and
Malaysia, and administrative offices located in California,
Tennessee, Mexico, Singapore and Malaysia.
The Company reported a net loss of $91.5 million on $406.3 million
of sales in fiscal 2013, compared to a net loss of $48.5 million
on $363.7 million of sales in fiscal 2012.
In their report on the consolidated financial statements for the
year ended March 31, 2013, Ernst & Young LLP, in Los Angeles,
California, noted that the Company's wholly owned subsidiary
Fenwick Automotive Products Limited has recurring operating losses
since the date of acquisition and has a working capital and an
equity deficiency. "In addition, Fenco has not complied with
certain covenants of its loan agreements with its bank. These
conditions relating to Fenco coupled with the significance of
Fenco to the Consolidated Companies, raise substantial doubt about
the Consolidated Companies' ability to continue as a going
concern."
MOTORCAR PARTS: Nantahala Capital Stake Down to 1.9% as of Dec. 31
------------------------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, Nantahala Capital Management, LLC, disclosed
that as of Dec. 31, 2013, it beneficially owned 287,579 shares of
common stock of Motorcar Parts of America, Inc., representing 1.92
percent of the shares outstanding. Nantahala Capital previously
owned 1,366,613 shares at June 7, 2013. A copy of the regulatory
filing is available for free at http://is.gd/qwCrp7
About Motorcar Parts
Torrance, California-based Motorcar Parts of America, Inc.
(Nasdaq: MPAA) is a remanufacturer of alternators and starters
utilized in imported and domestic passenger vehicles, light trucks
and heavy duty applications. Motorcar Parts of America's products
are sold to automotive retail outlets and the professional repair
market throughout the United States and Canada, with
remanufacturing facilities located in California, Mexico and
Malaysia, and administrative offices located in California,
Tennessee, Mexico, Singapore and Malaysia.
The Company reported a net loss of $91.5 million on $406.3 million
of sales in fiscal 2013, compared to a net loss of $48.5 million
on $363.7 million of sales in fiscal 2012. As of Dec. 31, 2013,
the Company had $297.34 million in total assets, $191.90 million
in total liabilities and $105.43 million in total shareholders'
equity.
In their report on the consolidated financial statements for the
year ended March 31, 2013, Ernst & Young LLP, in Los Angeles,
California, noted that the Company's wholly owned subsidiary
Fenwick Automotive Products Limited has recurring operating losses
since the date of acquisition and has a working capital and an
equity deficiency. "In addition, Fenco has not complied with
certain covenants of its loan agreements with its bank. These
conditions relating to Fenco coupled with the significance of
Fenco to the Consolidated Companies, raise substantial doubt about
the Consolidated Companies' ability to continue as a going
concern."
MOTORCAR PARTS: Raging Capital No Longer Owns Shares of Dec. 31
---------------------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, Raging Capital Master Fund, Ltd., Raging
Capital Management, LLC, and William C. Martin disclosed that as
of Dec. 31, 2013, they no longer beneficially owned any securities
of the Motorcar Parts of America, Inc. A copy of the regulatory
filing is available for free at http://is.gd/GPhJXX
About Motorcar Parts
Torrance, California-based Motorcar Parts of America, Inc.
(Nasdaq: MPAA) is a remanufacturer of alternators and starters
utilized in imported and domestic passenger vehicles, light trucks
and heavy duty applications. Motorcar Parts of America's products
are sold to automotive retail outlets and the professional repair
market throughout the United States and Canada, with
remanufacturing facilities located in California, Mexico and
Malaysia, and administrative offices located in California,
Tennessee, Mexico, Singapore and Malaysia.
The Company reported a net loss of $91.5 million on $406.3 million
of sales in fiscal 2013, compared to a net loss of $48.5 million
on $363.7 million of sales in fiscal 2012. As of Dec. 31, 2013,
the Company had $297.34 million in total assets, $191.90 million
in total liabilities and $105.43 million in total shareholders'
equity.
In their report on the consolidated financial statements for the
year ended March 31, 2013, Ernst & Young LLP, in Los Angeles,
California, noted that the Company's wholly owned subsidiary
Fenwick Automotive Products Limited has recurring operating losses
since the date of acquisition and has a working capital and an
equity deficiency. "In addition, Fenco has not complied with
certain covenants of its loan agreements with its bank. These
conditions relating to Fenco coupled with the significance of
Fenco to the Consolidated Companies, raise substantial doubt about
the Consolidated Companies' ability to continue as a going
concern."
MOUNTAIN PROVINCE: Reports C$26.6 Million 2013 Net Loss
-------------------------------------------------------
Mountain Province Diamonds Inc. filed with the U.S. Securities and
Exchange Commission its annual report on Form 20-F disclosing a
net loss of C$26.60 million for the year ended Dec. 31, 2013, as
compared with a net loss of C$3.33 million for the year ended
Dec. 31, 2012. The Company incurred a net loss of C$11.53 million
in 2011.
As of Dec. 31, 2013, the Company had C$110.36 million in total
assets, C$19.17 million in total liabilities and C$91.19 million
in total shareholders' equity.
Going Concern
"The Company currently has no source of revenues. In the years
ended December 31, 2013, 2012 and 2011, the Company incurred
losses, had negative cash flows from operating activities, and
will be required to obtain additional sources of financing to
complete its business plans going into the future. Although the
Company had working capital of $35,133,368 at December 31, 2013,
including $35,687,694 of cash and short-term investments, the
Company has insufficient capital to finance its operations and the
Company's share of development costs of the Gahcho Kue Project
(Note 8) over the next 12 months. The Company is currently
investigating various sources of additional funding to increase
the cash balances required for ongoing operations over the
foreseeable future. These additional sources include, but are not
limited to, share offerings, private placements, rights offerings,
credit and debt facilities, as well as the exercise of outstanding
options. However, there is no certainty that the Company will be
able to obtain financing from any of those sources. These
conditions indicate the existence of a material uncertainty that
results in substantial doubt as to the Company's ability to
continue as a going concern," the Company said in the Annual
Report.
A copy of the Form 20-F is available for free at:
http://is.gd/RpKEYV
About Mountain Province Diamonds
Headquartered in Toronto, Canada, Mountain Province Diamonds Inc.
(TSX: MPV, NYSE AMEX: MDM) -- http://www.mountainprovince.com/--
is a Canadian resource company in the process of permitting and
developing a diamond deposit known as the "Gahcho Kue Project"
located in the Northwest Territories of Canada. The Company's
primary asset is its 49 percent interest in the Gahcho Kue
Project.
MT. LAUREL LODGING: Can Access Cash Collateral Until Aug. 31
------------------------------------------------------------
The Bankruptcy Court approved an agreed supplement to the final
order dated Feb. 14, 2014, authorizing Mt. Laurel Lodging
Associates, LLP's use of cash collateral until Aug. 31.
The agreement to extend cash collateral use was entered between
the Debtor and National Republic Bank of Chicago. All other terms
and conditions of the final cash collateral will remain in full
force and effect.
A copy of the budget is available for free at
http://bankrupt.com/misc/MTLAUREL_274_cashcollord.pdf
A hearing on the Debtor's further access to the cash collateral
will be held on Aug. 11, at 10:00 a.m.
About Mt. Laurel Lodging
Mt. Laurel Lodging Associates, LLP, and its six affiliates sought
protection under Chapter 11 of the Bankruptcy Code on Nov. 4,
2013 (Case No. 13-bk-11697, Bankr. S.D. Ind.). The case is
assigned to Judge Robyn L. Moberly. The petition lists the
assets and debt as both exceeding $10 million on the Mount Laurel
property.
The Debtors are represented by Brian A Audette, Esq., and David M
Neff, Esq., at Perkins Coie LLP, in Chicago, Illinois; and Andrew
T. Kight, Esq., and Michael P. O'Neil, Esq., at Taft Stettinius &
Hollister LLP, in Indianapolis, Indiana.
The National Republic Bank of Chicago, a secured creditor, is
represented by James E. Carlberg, Esq., and James P. Moloy, Esq.,
at Bose McKinney & Evans LLP, in Indianapolis, Indiana; and
Timothy P. Duggan, Esq., at Stark & Stark, P.C., in
Lawrenceville, New Jersey.
MT. LAUREL LODGING: NRB Has Until May 16 to Appeal Valuation
------------------------------------------------------------
Bankruptcy Judge Robyn L. Moberly extended from May 2, 2014, to
May 16, the deadline for creditor National Republic Bank of
Chicago to appeal under Fed.R.Bankr.P.8002(c).
On Nov. 15, 2013, Mt. Laurel Lodging Associates, LLP, filed a
motion to determine the value of the NRB's secured claim. The
deadline under F.R.B.P. 8002 to file a notice of appeal from the
order was May 2.
On May 1, Ariel Weissberg, Esq., at Weissberg and Associates,
Ltd., on behalf of NRB, requested for the extension stating that
it has not decided definitively whether to file a notice of
appeal. NRB said it requires more time to examine the issue and
reach a final determination.
Also, NRB and the Debtor (and its principals) are engaged in good
faith settlement discussions, which could culminate with a
settlement within the next 14 days, or less.
About Mt. Laurel Lodging
Mt. Laurel Lodging Associates, LLP, and its six affiliates sought
protection under Chapter 11 of the Bankruptcy Code on Nov. 4,
2013 (Case No. 13-bk-11697, Bankr. S.D. Ind.). The case is
assigned to Judge Robyn L. Moberly. The petition lists the
assets and debt as both exceeding $10 million on the Mount Laurel
property.
The Debtors are represented by Brian A Audette, Esq., and David M
Neff, Esq., at Perkins Coie LLP, in Chicago, Illinois; and Andrew
T. Kight, Esq., and Michael P. O'Neil, Esq., at Taft Stettinius &
Hollister LLP, in Indianapolis, Indiana.
The National Republic Bank of Chicago, a secured creditor, is
represented by James E. Carlberg, Esq., and James P. Moloy, Esq.,
at Bose McKinney & Evans LLP, in Indianapolis, Indiana; and
Timothy P. Duggan, Esq., at Stark & Stark, P.C., in
Lawrenceville, New Jersey.
N-VIRO INTERNATIONAL: Assigns Purchase Contract to BGH
------------------------------------------------------
In October 2013 N-Viro International Corporation entered into a
contract to purchase real estate in Central Florida with a view
towards the construction of a new facility. Due to financial
constraints, on March 25, 2014, the Company assigned the contract
to purchase to a limited liability company ("BGH") that is owned
by a related party to management. Concurrently, BGH closed on the
purchase of the property, and as a condition to closing the seller
of the property required the Company to guarantee payment of the
financed portion of the purchase price of approximately $214,600.
The Company expects to be in production at this new location in
the second quarter of 2014, replacing the current facility in
Volusia County, Florida, and will operate under a newly formed and
wholly owned subsidiary, Mulberry Processing, LLC.
About N-Viro International
Toledo, Ohio-based N-Viro International Corporation owns and
sometimes licenses various N-Viro processes and patented
technologies to treat and recycle wastewater and other bio-organic
wastes, utilizing certain alkaline and mineral by-products
produced by the cement, lime, electrical generation and other
industries.
In its audit report on the consolidated financial statements for
the year ended Dec. 31, 2012, UHY LLP, in Farmington Hills,
Michigan, expressed substantial doubt about N-Viro's ability to
continue as a going concern, citing the Company's recurring
losses, negative cash flow from operations and net working capital
deficiency.
The Company reported a net loss of $1.6 million on $3.6 million of
revenues in 2012, compared with a net loss of $1.6 million of
$5.6 million of revenues in 2011. As of Sept. 30, 2013, the
Company had $1.97 million in total assets, $2.34 million in total
liabilities and a $369,192 total stockholders' deficit.
NATCHEZ REGIONAL: UMB Financing Extended Until July 15
------------------------------------------------------
Bankruptcy Judge Neil P. Olack approved Natchez Regional Medical
Center's amended motion to (i) obtain credit; (ii) modify the
automatic stay; and (iii) grant postpetition liens.
The Debtor requested that the Court extend until July 15, 2014,
the terms and condition of the line of credit and the existing
loan documents with the United Mississippi Bank. The Debtor will
use the loan to pay necessary operating expenses to: (i) protect
the assets of the estate; and (ii) complete a sale of the
hospital.
As of Petition Date, NRMC is obligated to UMB, on a revolving loan
note, originally date Aug. 5, 2008, renewed most recently on Aug.
2, 2012, and supported by draw notes renewed on Dec. 12, 2013 in
thea mount of $3,000,000 and a draw note renewed on Jan. 17, 2014
in the amount of $875,000 for a total principal amount of
$3,875,000.
As adequate protection from any diminution in value of the
lender's collateral, the Debtor will grant UMB a continuing lien
on UMB prepetition collateral including NRMC's cash and account
receivables, DSH and UPL installment payments.
A copy of the budget is available for free at:
http://bankrupt.com/misc/NATCHEZREGIONAL_122_financing.pdf
About Natchez Regional
Based in Natchez, Mississippi, Natchez Regional Medical Center is
a full-service hospital offering comprehensive diagnostic and
treatment services for acute, sub-acute and ambulatory care.
Natchez Regional serves as a referral center for the five
Mississippi counties and two Louisiana parishes it serves, known
locally as the Miss-Lou. The hospital is owned by Adams County.
The Debtor filed a petition for Chapter 9 on Feb. 12, 2009 (Bankr.
S.D. Miss. Case No. 09-00477). Eileen N. Shaffer, Esq.,
represents the Debtor as counsel. The Debtor listed total assets
of between $10 million and $50 million, and total debts of between
$10 million and $50 million.
No official committee has been appointed in the case.
NATCHEZ REGIONAL: Patient Care Ombudsman Not Necessary
------------------------------------------------------
Bankruptcy Judge Neil P. Olack has determined that appointment of
a patient care ombudsman in the Chapter 11 case of Natchez
Regional Medical Center is unnecessary for the protection of
patients under the specific facts of the Bankruptcy Case.
The Court also considered the response of Henry G. Hobbs, Jr., the
Acting U.S. Trustee for Region 5, on the Debtor's motion for
determination that PCO is unnecessary.
Based in Natchez, Mississippi, Natchez Regional Medical Center is
a full-service hospital offering comprehensive diagnostic and
treatment services for acute, sub-acute and ambulatory care.
Natchez Regional serves as a referral center for the five
Mississippi counties and two Louisiana parishes it serves, known
locally as the Miss-Lou. The hospital is owned by Adams County.
The Debtor filed a petition for Chapter 9 on Feb. 12, 2009 (Bankr.
S.D. Miss. Case No. 09-00477). Eileen N. Shaffer, Esq.,
represents the Debtor as counsel. The Debtor listed total assets
of between $10 million and $50 million, and total debts of between
$10 million and $50 million.
No official committee has been appointed in the case.
NELMAR PROPERTIES: Case Summary & 2 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Nelmar Properties, LLC
P.O. Box 511
Cumming, GA 30028
Case No.: 14-21084
Chapter 11 Petition Date: May 5, 2014
Court: United States Bankruptcy Court
Northern District of Georgia (Gainesville)
Debtor's Counsel: William A. Rountree, Esq.
MACEY, WILENSKY & HENNINGS LLC
Suite 4420, 303 Peachtree Street, NE
Atlanta, GA 30308
Tel: 404-584-1200
Fax: 404-681-4355
Email: mharris@maceywilensky.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Leigh H. Joya, managing member.
A list of the Debtor's two largest unsecured creditors is
available for free at http://bankrupt.com/misc/ganb14-21084.pdf
NEW TRIDENT: Moody's Lowers Corp. Family Rating to 'B3'
-------------------------------------------------------
Moody's Investors Service downgraded New Trident Holdcorp, Inc's
(TridentUSA) Corporate Family Rating to B3 from B2 and its
Probability of Default Rating to B3-PD from B2-PD. The company's
senior secured credit facilities ratings were downgraded to B2
from B1 and the senior secured 2nd lien term loan rating was
lowered to Caa2 from Caa1. The outlook is stable.
The downgrade of the CFR to B3 reflects TridentUSA's weaker than
anticipated operating performance and Moody's expectation that
credit metrics are unlikely to improve significantly in fiscal
2014, given the challenges the company faces integrating its Life
Choice Hospice acquisition and the weak flu season experienced
this past winter. According to Moody's analyst Ron Neysmith,
"EBITDA declined and leverage has increased because of lower
occupancy rates at its hospice business, higher integration costs,
and weaker top line performance at its core segment -- mobile x-
rays."
New Trident Holdcorp, Inc.:
Ratings downgraded:
Corporate Family Rating to B3 from B2
Probability of Default Rating to B3-PD from B2-PD
$75 million senior secured revolver expiring 2018 to B2
(LGD 3, 34%) from B1 (LGD 3, 34%)
$340 million senior secured 1st lien term loan due 2019 to B2
(LGD 3, 34%) from B1 (LGD 3, 34%)
$155 million senior secured 2nd lien term loan due 2020 to Caa2
(LGD 5, 86%) from Caa1 (LGD 5, 87%)
Rating Rationale
TridentUSA's B3 Corporate Family Rating reflects its very high
leverage, weaker operating performance at both its hospice and
mobile x-ray segments, along with high corporate infrastructure
investments to support acquisitions completed over the past 18
months. Pro forma debt to EBITDA for fiscal year-ended 12/31/13 --
including acquisitions made in 2013 -- was 7.4 times
(incorporating Moody's standard accounting adjustments). In
addition, the rating is constrained by TridentUSA's product
concentration in mobile x-ray, which comprises over 50% of
revenues. Furthermore, the ratings reflect the company's
aggressive shareholder friendly financial policy and Moody's
expectation that TridentUSA will continue to pursue acquisitions
and de novo expansion to supplement organic growth. Further, while
the company has grown rapidly, the revenue base is still
relatively small in comparison to many other corporate issuers.
The rating is supported by the company's leading national presence
in a very fragmented sector -- portable x-ray -- and its success
at being the sole industry consolidator. This provides advantages
in dealing with larger customers and creates efficiencies that can
lead to operating leverage as the company grows in the future.
The stable ratings outlook reflects Moody's expectation that the
company's credit metrics will improve modestly but remain quite
weak over the next 12 months despite near-term challenges. The
stable outlook also incorporates Moody's expectation that the
company will maintain at least an adequate liquidity profile.
A downgrade of the ratings is possible if the company's core
operations and hospice segment continue to weaken. Additionally,
the rating would likely be lowered if the company engages in debt-
financed acquisitions, if free cash flow turns negative, or if
liquidity deteriorates.
The ratings could be upgraded if the company exhibits a
combination of positive EBITDA and patient volume growth in its
core business segments, while also reducing debt/EBITDA to around
5.5 times on a sustained basis.
TridentUSA, headquartered in Burbank, CA, is a leading nationwide
vertically-integrated provider of outsourced ancillary healthcare
and clinical services, offering mobile x-ray, ultrasound,
teleradiology, mobile clinical and laboratory services to skilled
nursing home, assisted living, home healthcare, hospice and
correctional markets. TridentUSA, through Life Choice Hospice,
provides hospice care specifically serving skilled nursing
facilities and assisted living facilities.
NII HOLDINGS: Frontier Capital Stake at 9.7% as of Dec. 31
----------------------------------------------------------
In a Schedule 13G filed with the U.S. Securities and Exchange
Commission, Frontier Capital Management Co, LLC, disclosed that as
of Dec. 31, 2013, it beneficially owned 16,848,363 shares of
common stock of NII Holdings Inc. representing 9.771 percent of
the shares outstanding. A copy of the regulatory filing is
available for free at http://is.gd/zApAmx
About NII Holdings
With headquarters in Reston, Virginia, NII Holdings is an
international wireless operator with more than 7 million largely
post-pay, business subscribers.
NII Holdings reported a net loss of $1.64 billion for the year
ended Dec. 31, 2013, as compared with a net loss of $765.25
million in 2012. As of Dec. 31, 2013, the Company had $8.68
billion in total assets, $8.32 billion in total liabilities and
$355.4 million in total stockholders' equity.
As reported by the TCR on March 19, 2014, the Company dismissed
PricewaterhouseCoopers LLP as its independent registered public
accounting firm. PwC's report on the consolidated financial
statements as of and for the year ended Dec. 31, 2013, contained a
separate paragraph stating:
"The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going
concern. As more fully discussed in Note 1 to the
consolidated financial statements, the Company projects that
it is likely that it will not be able to comply with certain
debt covenants throughout 2014. This condition and its
impact on the Company's liquidity raise substantial doubt
about the Company's ability to continue as a going concern.
Management's plans in regard to this matter are also
described in Note 1. The consolidated financial statements
do not include any adjustments that might result from the
outcome of this uncertainty."
KPMG LLP was appointed as the Company's new independent registered
public accounting firm for the fiscal year ending Dec. 31, 2014.
Bankruptcy Warning
"Our ability to obtain funding is subject to a variety of factors
that we cannot presently predict with certainty, including our
future performance, the volatility and demand in the capital
markets and future market prices of our securities. Because of
the combined impact of our recent and projected results of
operations, our non-investment grade credit rating, the inclusion
of the going concern statement in the report of our independent
registered public accounting firm, restrictions in our current
debt and/or general conditions in the financial and credit
markets, our access to the capital markets is likely to be limited
and, if available, the cost of any funding could be both
significant and higher than the cost of our existing financing
arrangements. Moreover, the urgency of a capital-raising
transaction may require us to pursue funding at an inopportune
time. We may not be successful in obtaining capital for these or
other reasons. If we fail to obtain suitable financing when it's
required, it could, among other things, negatively impact our
results of operations and liquidity, result in our inability to
implement our current or future business plans, and prevent us
from meeting our debt service obligations.
"If we are unable to meet our debt service obligations or to
comply with our other obligations under our existing financing
arrangements:
* the holders of our debt could declare all outstanding
principal and interest to be due and payable;
* the holders of our secured debt could commence foreclosure
proceedings against our assets;
* we could be forced into bankruptcy or liquidation; and
* debt and equity holders could lose all or part of their
investment in us," the Company said in the Annual Report for
the year ended Dec. 31, 2013.
* * *
As reported by the TCR on March 5, 2014, Standard & Poor's Ratings
Services lowered its corporate credit rating on Reston, Va.-based
wireless carrier NII Holdings Inc. (NII) to 'CCC' from 'CCC+'.
"The downgrade follows the company's poor fourth-quarter 2013
results that were below our expectations, and its disclosure that
its auditors have uncertainty about the company's ability to
continue as a going concern," said Standard & Poor's credit
analyst Allyn Arden.
The TCR also reported on March 5, 2014, that Moody's Investors
Service downgraded the corporate family rating (CFR) of NII
Holdings Inc. ("NII" or "the company") to Caa1 from B3. The
downgrade reflects the company's poor 2013 operating performance
and the risk that the company will violate the covenants governing
its Mexican and Brazilian subsidiary debt, which could trigger an
event of default for up to $4.4 billion of debt issued by
intermediate holding companies NII Capital Corp. and NII
International Telecom S.C.A.
NII HOLDINGS: FMR LLC Reports 14.2% Equity Stake
------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission on Feb. 13, 2014, FMR LLC and Edward C.
Johnson 3d disclosed that they beneficially owned 24,490,858
shares of common stock of NII Holdings Incorporated representing
14.2 percent of the shares outstanding. A copy of the regulatory
filing is available for free at http://is.gd/FWngbD
About NII Holdings
With headquarters in Reston, Virginia, NII Holdings is an
international wireless operator with more than 7 million largely
post-pay, business subscribers.
NII Holdings reported a net loss of $1.64 billion for the year
ended Dec. 31, 2013, as compared with a net loss of $765.25
million in 2012. As of Dec. 31, 2013, the Company had $8.68
billion in total assets, $8.32 billion in total liabilities and
$355.4 million in total stockholders' equity.
As reported by the TCR on March 19, 2014, the Company dismissed
PricewaterhouseCoopers LLP as its independent registered public
accounting firm. PwC's report on the consolidated financial
statements as of and for the year ended Dec. 31, 2013, contained a
separate paragraph stating:
"The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going
concern. As more fully discussed in Note 1 to the
consolidated financial statements, the Company projects that
it is likely that it will not be able to comply with certain
debt covenants throughout 2014. This condition and its
impact on the Company's liquidity raise substantial doubt
about the Company's ability to continue as a going concern.
Management's plans in regard to this matter are also
described in Note 1. The consolidated financial statements
do not include any adjustments that might result from the
outcome of this uncertainty."
KPMG LLP was appointed as the Company's new independent registered
public accounting firm for the fiscal year ending Dec. 31, 2014.
Bankruptcy Warning
"Our ability to obtain funding is subject to a variety of factors
that we cannot presently predict with certainty, including our
future performance, the volatility and demand in the capital
markets and future market prices of our securities. Because of
the combined impact of our recent and projected results of
operations, our non-investment grade credit rating, the inclusion
of the going concern statement in the report of our independent
registered public accounting firm, restrictions in our current
debt and/or general conditions in the financial and credit
markets, our access to the capital markets is likely to be limited
and, if available, the cost of any funding could be both
significant and higher than the cost of our existing financing
arrangements. Moreover, the urgency of a capital-raising
transaction may require us to pursue funding at an inopportune
time. We may not be successful in obtaining capital for these or
other reasons. If we fail to obtain suitable financing when it's
required, it could, among other things, negatively impact our
results of operations and liquidity, result in our inability to
implement our current or future business plans, and prevent us
from meeting our debt service obligations.
"If we are unable to meet our debt service obligations or to
comply with our other obligations under our existing financing
arrangements:
* the holders of our debt could declare all outstanding
principal and interest to be due and payable;
* the holders of our secured debt could commence foreclosure
proceedings against our assets;
* we could be forced into bankruptcy or liquidation; and
* debt and equity holders could lose all or part of their
investment in us," the Company said in the Annual Report for
the year ended Dec. 31, 2013.
* * *
As reported by the TCR on March 5, 2014, Standard & Poor's Ratings
Services lowered its corporate credit rating on Reston, Va.-based
wireless carrier NII Holdings Inc. (NII) to 'CCC' from 'CCC+'.
"The downgrade follows the company's poor fourth-quarter 2013
results that were below our expectations, and its disclosure that
its auditors have uncertainty about the company's ability to
continue as a going concern," said Standard & Poor's credit
analyst Allyn Arden.
The TCR also reported on March 5, 2014, that Moody's Investors
Service downgraded the corporate family rating (CFR) of NII
Holdings Inc. ("NII" or "the company") to Caa1 from B3. The
downgrade reflects the company's poor 2013 operating performance
and the risk that the company will violate the covenants governing
its Mexican and Brazilian subsidiary debt, which could trigger an
event of default for up to $4.4 billion of debt issued by
intermediate holding companies NII Capital Corp. and NII
International Telecom S.C.A.
NII HOLDINGS: Discovery Capital Reports 0% Equity Stake
-------------------------------------------------------
In an amended Schedule 13G filed with the U.S. Securities and
Exchange Commission, Discovery Capital Management, LLC, and
Robert K. Citrone disclosed that as of Dec. 31, 2013, they ceased
to be the beneficial owner of any shares of common stock of NII
Holdings, Inc. A copy of the regulatory filing is available at:
http://is.gd/Yocwf8
About NII Holdings
With headquarters in Reston, Virginia, NII Holdings is an
international wireless operator with more than 7 million largely
post-pay, business subscribers.
NII Holdings reported a net loss of $1.64 billion for the year
ended Dec. 31, 2013, as compared with a net loss of $765.25
million in 2012. As of Dec. 31, 2013, the Company had $8.68
billion in total assets, $8.32 billion in total liabilities and
$355.4 million in total stockholders' equity.
As reported by the TCR on March 19, 2014, the Company dismissed
PricewaterhouseCoopers LLP as its independent registered public
accounting firm. PwC's report on the consolidated financial
statements as of and for the year ended Dec. 31, 2013, contained a
separate paragraph stating:
"The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going
concern. As more fully discussed in Note 1 to the
consolidated financial statements, the Company projects that
it is likely that it will not be able to comply with certain
debt covenants throughout 2014. This condition and its
impact on the Company's liquidity raise substantial doubt
about the Company's ability to continue as a going concern.
Management's plans in regard to this matter are also
described in Note 1. The consolidated financial statements
do not include any adjustments that might result from the
outcome of this uncertainty."
KPMG LLP was appointed as the Company's new independent registered
public accounting firm for the fiscal year ending Dec. 31, 2014.
Bankruptcy Warning
"Our ability to obtain funding is subject to a variety of factors
that we cannot presently predict with certainty, including our
future performance, the volatility and demand in the capital
markets and future market prices of our securities. Because of
the combined impact of our recent and projected results of
operations, our non-investment grade credit rating, the inclusion
of the going concern statement in the report of our independent
registered public accounting firm, restrictions in our current
debt and/or general conditions in the financial and credit
markets, our access to the capital markets is likely to be limited
and, if available, the cost of any funding could be both
significant and higher than the cost of our existing financing
arrangements. Moreover, the urgency of a capital-raising
transaction may require us to pursue funding at an inopportune
time. We may not be successful in obtaining capital for these or
other reasons. If we fail to obtain suitable financing when it's
required, it could, among other things, negatively impact our
results of operations and liquidity, result in our inability to
implement our current or future business plans, and prevent us
from meeting our debt service obligations.
"If we are unable to meet our debt service obligations or to
comply with our other obligations under our existing financing
arrangements:
* the holders of our debt could declare all outstanding
principal and interest to be due and payable;
* the holders of our secured debt could commence foreclosure
proceedings against our assets;
* we could be forced into bankruptcy or liquidation; and
* debt and equity holders could lose all or part of their
investment in us," the Company said in the Annual Report for
the year ended Dec. 31, 2013.
* * *
As reported by the TCR on March 5, 2014, Standard & Poor's Ratings
Services lowered its corporate credit rating on Reston, Va.-based
wireless carrier NII Holdings Inc. (NII) to 'CCC' from 'CCC+'.
"The downgrade follows the company's poor fourth-quarter 2013
results that were below our expectations, and its disclosure that
its auditors have uncertainty about the company's ability to
continue as a going concern," said Standard & Poor's credit
analyst Allyn Arden.
The TCR also reported on March 5, 2014, that Moody's Investors
Service downgraded the corporate family rating (CFR) of NII
Holdings Inc. ("NII" or "the company") to Caa1 from B3. The
downgrade reflects the company's poor 2013 operating performance
and the risk that the company will violate the covenants governing
its Mexican and Brazilian subsidiary debt, which could trigger an
event of default for up to $4.4 billion of debt issued by
intermediate holding companies NII Capital Corp. and NII
International Telecom S.C.A.
ORCKIT COMMUNICATIONS: Postpones Creditors' Meeting Pending Talks
-----------------------------------------------------------------
Orckit Communications Ltd. has postponed its meeting of creditors
pending the completion of the negotiation of the final terms of
the arrangement with the representatives of the creditors.
The Company previously scheduled May 4, 2014, as the creditors'
meeting and May 14, 2014, as the shareholders' meeting to vote
upon the proposed arrangement under Section 350 of the Israeli
Companies Law. A new date for the creditors' meeting will be
published in the future.
The shareholders' meeting will be held as scheduled on May 14,
2014, based on the principles set forth in the proxy statement
filed by the Company on April 14, 2014. There may be no further
updates regarding the arrangement prior to the shareholders'
meeting.
About Orckit
Tel-Aviv, Israel-based Orckit Communications Ltd. (TASE: ORCT)
engages in the design, development, manufacture and marketing of
advanced telecom equipment to telecommunication service providers
in metropolitan areas. The Company's products are transport
telecommunication equipment targeting high capacity packetized
metropolitan networks.
Orckit disclosed a net loss of $6.46 million on $11.19 million of
revenues for the year ended Dec. 31, 2012, as compared with a net
loss of $17.38 million on $15.58 million of revenues for the year
ended Dec. 31, 2011. The Company's balance sheet at Sept. 30,
2013, showed $12.44 million in total assets, $24.03 million in
total liabilities and a $11.59 million total capital deficiency.
Kesselman & Kesselman, issued a "going concern" qualification on
the consolidated financial statements for the year ended Dec. 31,
2012. The independent auditors noted that the Company has a
capital deficiency, recurring losses, negative cash flows from
operating activities and has significant future commitments to
repay its convertible subordinated notes. These facts raise
substantial doubt as to the Company's ability to continue as a
going concern.
OVERSEAS SHIPHOLDING: PJSC Okayed as Equity Panel's Fin'l Advisor
-----------------------------------------------------------------
The U.S. Bankruptcy Court authorized the retention of Peter J.
Solomon Company as financial advisor to the Official Committee of
Equity Security Holders in the Chapter 11 case of Overseas
Shipholding Group, et al.
PJSC is expected to:
a) advise and assist the Committee in assessing the operating
and financial performance of, and strategies for, the
Debtors;
b) advise and assist the Committee in reviewing and analyzing
the business plans and financial projections prepared by the
Debtors including, but not limited to, testing assumptions
and comparing those assumptions to historical and industry
trends; and
c) advise and assist the Committee in evaluating the Debtors
and their assets and liabilities, including valuations
proposed by any interested party, and upon the Committee's
request, will prepare a valuation report.
Anders J. Maxwell, managing director of PJSC, who maintains an
office at 1345 Avenue of the Americas, New York City, tells the
Court that PJSC's fee structure includes, among other things:
1. an advisory fee of $175,000 per month, prorated for any
incomplete monthly period of service;
2. payment in cash of one of the following:
(i) a completion fee equal to $3,000,000, payable upon the
confirmation of a plan of reorganization,
(ii) a completion fee equal to $2,250,000 payable upon the
confirmation of a Plan, and
(iii) a completion fee equal to $1,500,000, payable upon the
confirmation of a Plan.
The Court order also provides that the Debtors, the official
committee of unsecured creditors, the agent under the $1.5 billion
credit agreement dated Feb. 9, 2006, and the consenting lenders
will not seek to disqualify or discredit PJSC in its capacity as
an expert in the cases on the basis of the completion fee or the
structure of fees.
Mr. Maxwell assured the Court that PJSC is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
About Overseas Shipholding
Overseas Shipholding Group, Inc. (OTC: OSGIQ), headquartered in
New York, is one of the largest publicly traded tanker companies
in the world, engaged primarily in the ocean transportation of
crude oil and petroleum products. OSG owns or operates 111
vessels that transport oil and petroleum products throughout the
world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67
billion in liabilities. Greylock Partners LLC Chief Executive
John Ray serves as chief reorganization officer. James L.
Bromley, Esq., and Luke A. Barefoot, Esq., at Cleary Gottlieb
Steen & Hamilton LLP serve as OSG's Chapter 11 counsel. Derek C.
Abbott, Esq., Daniel B. Butz, Esq., and William M. Alleman, Jr.,
at Morris, Nichols, Arsht & Tunnell LLP, serve as local counsel.
Chilmark Partners LLC serves as financial adviser. Kurtzman
Carson Consultants LLC is the claims and notice agent.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve
as co-counsel to the official committee of unsecured creditors.
FTI Consulting, Inc., is the financial advisor and Houlihan Lokey
Capital, Inc., is the investment banker.
An Official Committee of Equity Security Holders also has been
appointed in OSG's case. Fox Rothschild LLP and Brown Rudnick LLP
serve as co-counsel to Equity Committee.
PACHECO PLAZA: Ch.11 Case Dismissed, Slapped With 2-Year Ban
------------------------------------------------------------
Bankruptcy Judge W. Richard Lee in Fresno, Calif., dismissed the
Chapter 11 case filed by Pacheco Plaza LLC and barred the debtor
from seeking bankruptcy protection for a two-year period.
The U.S. Trustee made the request.
Pacheco Plaza filed for Chapter 11 bankruptcy (Bankr. E.D. Cal.
Case No. 14-10638) on Feb. 13, 2014. This is the Company's second
bankruptcy case. A third, affiliated, Chapter 7 case was filed by
Jong Yul Park, on Jan. 9, 2014.
Pacheco Plaza also was a debtor in a Chapter 7 bankruptcy case
(Case No. 13-17759) also filed in Fresno on Dec. 10, 2013.
Pacheco Plaza designated the case as "Single Asset Real Estate" on
page one of the Voluntary Petition, and listed one creditor,
Community Commerce Bank. The case was dismissed on Dec. 20, 2013,
for failure to file documents. The case was filed on the eve of a
foreclosure sale.
Pacheco Plaza lists commercial property located as 1235 E. Pacheco
Blvd., Los Banos, CA 93635, on Schedule A. The Defendant's sole
asset other than real property is $100 in a bank account.
Jong Yul Park also listed one creditor, Community Commerce Bank.
The case was dismissed on Feb. 10, 2014, for failure to file
documents. The case was filed on the eve of a foreclosure sale on
the same property.
On page 2 of the Current Case Voluntary Petition, in connection
with the requirement that Pacheco Plaza disclose "Prior Bankruptcy
Cases Filed Within the Last 8 Years," it affirmatively indicated
"none." Also, in connection with the requirement that it disclose
"Pending Bankruptcy Case Filed by any Spouse, Partner, or
Affiliate or this Debtor," it affirmatively indicated "none."
According to the bankruptcy judge, Pacheco Plaza's case should be
dismissed with a two-year bar to re-filing because it is a serial
filer and its conduct constitutes bad faith.
The case before the Court is, TRACY HOPE DAVIS, United States
Trustee, Plaintiff, v. PACHECO PLAZA, LLC, Defendant, A.P. No. 14-
01022 (Bankr. E.D. Calif.). A copy of the Court's April 30
Findings of Fact and Conclusions of Law is available at
http://is.gd/Cyp3Ejfrom Leagle.com.
PARADE PLACE: Samuel's Temple Church's Bid to Reargue Denied
------------------------------------------------------------
In the case, Samuel's Temple Church of God in Christ, Plaintiff,
v. Parade Place, LLC, Saadia Shapiro, Marla Shapiro, Valley
National Bank, Defendants, Adv. Pro. Case No. 13-01556 (MG)
(Bankr. S.D.N.Y.), the Court on Jan. 27, 2014, entered an Opinion
and Order granting the motion of 75 125th Holdings LLC,
substituting Holdings in place of Valley National Bank as
defendant and dismissing the Adversary Complaint as to
Valley/Holdings. (Troubled Company Reporter, Jan. 31, 2014).
Samuel's Temple Church of God in Christ did not oppose the relief
sought by Holdings. The Church subsequently retained new counsel
and filed a Motion to Reargue, asking the Court to reconsider and
vacate its Prior Opinion. The Church argues that (1) its former
counsel inadvertently neglected to oppose the relief sought by
Holdings; (2) substitution of Holdings as defendant was
inappropriate because Holdings could have merely intervened; and
(3) Holdings failed to establish that the Church's claims are
barred by any of the doctrines of res judicata, collateral
estoppel, Rooker-Feldman, and D'Oench.
On May 2, 2014, Bankruptcy Judge Martin Glenn denied the Motion.
"The Church has not identified an intervening change of
controlling law, and the Motion does not rely on new evidence.
Further, the Church has failed to show the need to correct clear
error of law or prevent manifest injustice, or that the Court
overlooked matters that would have altered its decision. But
because the Church has identified claims against Valley not
previously articulated to the Court, the Court clarifies that
nothing in the Prior Opinion bars the Church from attempting to
assert those claims in state court. This Court, however, will not
exercise jurisdiction over claims solely between two non-debtors,
with no conceivable effect on the bankruptcy estates in these
proceedings," Judge Glenn said.
A copy of the Court's May 2, 2014 Memorandum Opinion and Order is
available at http://is.gd/DACDXKfrom Leagle.com.
Attorney for Samuel's Temple Church of God in Christ:
Robert G. Leino, Esq.
224 Riverside Drive
New York, NY 10025
Tel: (212) 964-1574
(917) 613-5926 cell
Fax: (212) 385-2515
Email: rgleino@leinolaw.com
Attorneys for 75 125th Holdings LLC:
Jerold Feurstein, Esq.
KRISS & FEURSTEIN LLP
360 Lexington Avenue, Suite 1200
New York, NY 10017
Tel: 212-661-2900
Fax: 212-661-9397
E-mail: jfeuerstein@kandfllp.com
About Parade Place
Parade Place LLC, which owns properties in New York, sought
Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No.
13-13160) on Sept. 27, 2013, blaming the economy and Harlem real
estate market. Judge Judge Martin Glenn presides over the case.
Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene
Genovese & Gluck, P.C., serves as the Debtor's counsel. The
Company listed debt of $24.6 million and assets of about $3.7
million. The petition was signed by Saadia Shapiro, managing
member.
Parade owns property located at 69 East 125th St., which it
estimates is valued at $1.6 million, 71 East 125th St., which it
believes is worth, $1.3 million and 58 East 126th St., which has
an estimated value of $800,000, court papers show. The properties
are vacant.
An affiliate, 75 East 125th LLC, which sought bankruptcy
protection Sept. 23, owns property at 75 East 125th St. The
properties comprise a partially completed development site.
PATRIOT ELECTRIC: M&T Dispute Goes Straight to Md. Appeals Court
----------------------------------------------------------------
In the case, Patriot Electric and Mechanical, Inc. Plaintiff, v.
Manufacturers and Traders Trust Company, Defendant, Adv. Proc. No.
13-00174 (Bankr. D. Md.), Bankruptcy Judge Robert A. Gordon in
Baltimore, Maryland, certified for direct appeal to the Maryland
Court of Appeals these questions:
I. Is a financing statement that does not contain the
debtor's correct name and is not discoverable by searching for the
debtor's correct name within the filing office records by
utilizing the Search Logic promulgated by SDAT, but is otherwise
discoverable if a searcher of the filing office records submits
the correct beginning of the debtor's name utilizing the Search
Logic, seriously misleading within the meaning of Sections 9-
502(a)(1), 9-503(a)(1) and 9-506 of the Annotated Code of
Maryland, Commercial Law Article?
II. How should the Search Logic instruction that requires a
searcher to enter "as much or as little of the [debtor's] name [as
the searcher] is certain of" be construed in the case of Section
544(a)'s hypothetical lien creditor who is statutorily mandated to
be "without knowledge"?
Judge Gordon said the Adversary Proceeding raises intriguing
questions of first impression regarding the perfection of secured
transactions in Maryland. The Bankruptcy Court concludes, and the
parties agree, that the Maryland Court of Appeals should decide
them.
Judge Gordon explained that the case turns on the question of how
Sections 9-502(a)(1), 9-503(a)(1) and 9-506 of the Annotated Code
of Maryland, Commercial Law Article, as complemented by the
internet search logic (Search Logic) for UCC financing statements,
should be interpreted within the context of 11 U.S.C. Sec.
544(a)(1) which places a debtor-in-possession in the shoes of a
hypothetical lien creditor as of the commencement of a bankruptcy
case. Patriot and M&T stipulated to the material facts and both
sought summary judgment. However, the Court and parties now agree
that in light of the question's importance to Maryland law and
policy regarding commercial transactions, and to secure
accelerated and inviolate finality, the questions are best
resolved by the Court of Appeals.
Patriot is obligated to M&T in connection with a $1,250,000 Loan
and a $250,000 Loan that M&T's predecessor, K Bank, extended to
the Debtor in February 2007. Patriot is also obligated to M&T in
connection with its guaranty of a $1,522,000 that M&T extended to
TW3 Properties, LLC. The K Bank loans were purchased by M&T from
the FDIC, in its capacity as receiver for K Bank, in November
2010.
A copy of Judge Gordon's May 1, 2014 Memorandum Opinion is
available at http://is.gd/LIkG65from Leagle.com.
Patriot Electric and Mechanical Inc., based in Curtis Bay, MD,
filed for Chapter 11 bankruptcy (Bankr. D. Md. Case No. 13-15055)
on March 22, 2013. Judge Robert A. Gordon presides over the case.
Ronald J. Drescher, Esq. -- ecf@drescherlaw.com -- at Drescher &
Associates, P.A., serves as the Debtor's counsel. It listed under
$1 million in assets and under $10 million in debts.
TW3 Properties LLC also filed a bankruptcy petition (Case No. 13-
15058), listing under $10 million in both assets and debts.
The petitions were signed by Talbot Watkins, III, president.
A copy of Patriot's list of 20 largest unsecured creditors filed
with the petition is available for free at
http://bankrupt.com/misc/mdb13-15055.pdf
PICCADILLY RESTAURANTS: Plan Declared Effective on April 17
-----------------------------------------------------------
The First Amended Joint Chapter 11 Plan of Piccadilly Investments,
LLC, Piccadilly Restaurants, LLC, and Piccadilly Food Service,
LLC was declared effective on April 17, 2014.
Judge Summerhays entered an order confirming the Amended Plan on
Feb. 13, 2014. The Plan is co-proposed by Atalaya Administrative
LLC, Atalaya Funding II, LP, Atalaya Special Opportunities Fund
IV, LP (Tranche B), Atalaya Special Opportunities Fund (Cayman) IV
LP (Tranche B), and the Official Committee of Unsecured Creditors.
The Troubled Company Reporter previously reported that the Plan
proposed to convert $9 million of secured debt to Atalaya for 100
percent of the equity of the reorganized Debtor, with the
remaining $19 million secured claim to be paid off with a term
note. Unsecured creditors with claims of $4.5 million to $7
million are impaired although they are estimated to recover
approximately 100 percent, with payment from $1 million allocated
by the Plan Proponents plus proceeds from a $4,750,000 note.
Yucaipa, the 100% owner, will be wiped out.
Yucaipa tried but failed to convince the Bankruptcy Court to stay
the Confirmation Order.
About Piccadilly Restaurants
Piccadilly Restaurants, LLC, and two affiliated entities sought
Chapter 11 bankruptcy protection (Bankr. W.D. La. Case Nos.
12-51127 to 12-51129) on Sept. 11, 2012. The affiliates are
Piccadilly Food Service, LLC, and Piccadilly Investments LLC.
Piccadilly Restaurants, LLC, headquartered in Baton Rouge,
Louisiana, is the largest cafeteria-style restaurant in the United
States, with operations in 10 states in the Southeast and Mid-
Atlantic regions. It is wholly owned by Piccadilly Investments,
LLC. Piccadilly operates an institutional foodservice division
through a wholly owned subsidiary, Piccadilly Food Service, LLC,
servicing schools and other organizations. With a history dating
back to 1944, the Company operates 81 restaurants at three owned
and 78 leased locations.
Then known as Piccadilly Cafeterias, Inc., the Company filed for
Chapter 11 relief (Bankr. S.D. Fla. Case No. 03-27976) on Oct. 29,
2003. Paul Steven Singerman, Esq., and Jordi Guso, Esq., at
Berger Singerman, P.A., represented the Debtor in the case. After
Piccadilly declared bankruptcy under Chapter 11, but before its
plan was submitted to the Bankruptcy Court for the Southern
District of Florida, the Bankruptcy Court authorized Piccadilly to
sell its assets to Yucaipa Cos., for about $80 million. In
October 2004, the Bankruptcy Court confirmed the plan.
Judge Robert Summerhays oversees the 2012 cases. Attorneys at
Jones, Walker. Waechter, Poitevent, Carrere & Denegre, LLP,
represent the Debtors in their restructuring efforts. BMC Group,
Inc., serves as claims agent, noticing agent and balloting agent.
In its schedules, the Debtor disclosed $34,952,780 in assets and
$32,000,929 in liabilities.
Jeffrey L. Cornish serves as the Debtors' consultant.
Postlethwaite & Netterville, PAC, serve as their independent
auditors, accountants and tax consultants. GA Keen Realty
Advisors, LLC, serve as the Debtors' special real estate advisors
while FTI Consulting, Inc., as their financial consultants.
New York-based vulture fund Atalaya Administrative LLC, in its
capacity as administrative agent for Atalaya Funding II, LP,
Atalaya Special Opportunities Fund IV LP (Tranche B), and Atalaya
Special Opportunities Fund (Cayman) IV LP (Tranche B), the
Debtors' prepetition secured lender, is represented in the case
by lawyers at Carver, Darden, Koretzky, Tessier, Finn, Blossman &
Areaux, L.L.C.; and Patton Boggs, LLP.
The United States Trustee for Region 5 appointed seven members to
the official committee of unsecured creditors in the Debtors'
Chapter 11 cases. The Committee sought and obtained Court
approval to employ Frederick L. Bunol, Esq., and Albert J. Derbes,
IV, Esq., of Derbes Law Firm, LLC., as attorneys. Greenberg
Traurig LLP also serves as counsel for the Committee while
Protiviti Inc. serves as financial advisor.
PORTER BANCORP: Reports $976,000 Net Loss in First Quarter
----------------------------------------------------------
Porter Bancorp, Inc., reported that net loss attributable to
common shareholders decreased to $976,000, or ($0.08) per diluted
share, for the first quarter of 2014 compared to a net loss of
$1,028,000, or ($0.09) per diluted share for the fourth quarter of
2013 and increased compared to the net loss of $524,000, or
($0.04) per diluted share, for the first quarter of 2013.
"Our primary initiatives for 2014 are to continue reducing non-
performing assets, restore capital, and return to sustainable
profitability while continuing to serve our customers and
developing new quality financial relationships," the Company said
in a press release.
"Management and the Board of Directors continue to evaluate
appropriate strategies for increasing the Company's capital in
order to meet the capital requirements of the Consent Order.
These include, among other things, a possible public offering or
private placement of common stock to new and existing
shareholders. As previously announced, the Company has engaged a
financial advisor to assist the Board of Directors in this
evaluation," the Company added.
A copy of the press release is available for free at:
http://is.gd/2xgMRz
About Porter Bancorp
Porter Bancorp, Inc., is a bank holding company headquartered in
Louisville, Kentucky. Through its wholly-owned subsidiary PBI
Bank, the Company operates 18 full-service banking offices in
12 counties in Kentucky.
Porter Bancorp incurred a net loss attributable to common
shareholders of $3.39 million in 2013, a net loss attributable to
common shareholders of $33.43 million in 2012 and a net loss
attributable to common shareholders of $105.15 million in 2011.
As of Dec. 31, 2013, the Company had $1.07 billion in total
assets, $1.04 billion in total liabilities and $35.93 million in
total stockholders' equity.
Crowe Horwath, LLP, in Louisville, Kentucky, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2013. The independent auditors noted
that the Company has incurred substantial losses in 2013, 2012 and
2011, largely as a result of asset impairments. In addition, the
Company's bank subsidiary is not in compliance with a regulatory
enforcement order issued by its primary federal regulator
requiring, among other things, increased minimum regulatory
capital ratios. Additional losses or the continued inability to
comply with the regulatory enforcement order may result in
additional adverse regulatory action. These events raise
substantial doubt about the Company's ability to continue as a
going concern.
PURADYN FILTER: Reports $1.3 Million 2013 Net Loss
--------------------------------------------------
Puradyn Filter Technologies Incorporated filed with the U.S.
Securities and Exchange Commission its annual report on Form 10-K
disclosing a net loss of $1.33 million on $2.53 million of net
sales for the year ended Dec. 31, 2013, as compared with a net
loss of $2.22 million on $2.56 million of net sales during the
prior year.
As of Dec. 31, 2013, the Company had $1.39 million in total
assets, $11.62 million in total liabilities and a $10.22 million
total stockholders' deficit.
Kevin G. Kroger, president and COO, stated, "Revenues for 2013
were disappointing, however, based on orders received to date, we
are showing a strong first quarter in 2014. In 2013 we were able
to add two new distributors, both with solid track records in
their respective industries, which will be able to introduce our
product to industries and regions in which we have had only
limited success. In addition, recent articles in trade magazines
regarding our technology's success in helping one of our customers
save millions of dollars annually are increasing recognition of
our product's performance."
Kroger, concluded, "Based upon customer feedback and progress
reports on current product evaluations, we remain optimistic in
2014."
Liggett, Vogt & Webb, P.A., in Boynton Beach, Florida, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2013. The independent
auditors noted that the Company has a net loss of $1,333,292,
negative cash flow from operations of $957,941, a working capital
deficiency of $769,907 and a stockholders' deficiency of
$10,227,875. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/0lhe2U
About Puradyn Filter
Boynton Beach, Fla.-based Puradyn Filter Technologies Incorporated
(OTC BB: PFTI) designs, manufactures and markets the puraDYN's Oil
Filtration System.
PWK TIMBERLAND: Remaining Withdrawing Members Support Dean Pact
---------------------------------------------------------------
The so-called remaining withdrawing members ask the Bankruptcy
Court to authorize PWK Timberland, LLC, and Lillian Ruth Harper
Dean to enter into an act of transfer, compromise and release.
Mrs. Dean is the owner of 0.071500 membership unit in the Debtor.
The Debtor sought authority to acquire Mrs. Dean's ownership
interest for $17,160. Mrs. Dean has agreed to transfer her
ownership interest to the Debtor. Mrs. Dean has agreed to
withdraw her proof of claim and release the Debtor and its
officers and directors from all pending litigation.
The remaining withdrawing members said that they have no
objections to the transfer as the pleading involves only PWK and
Lillian Ruth Harper Dean, and the remaining withdrawing members
are not a party to same, the allegations must not affect, in any
way, the rights of the remaining withdrawing members to assert
their contrary position as to various factual and legal assertions
made by PWK in its motion and attachments, at the trial which has
been fixed for hearing on Oct. 27, 28, and 29, 2014, in Lafayette,
Louisiana.
The remaining withdrawing members consist of Melissa White Harper,
Rachel Elizabeth Harper, Sarah Virginia Harper, James Roland
Harper, IV, Esther White Goldstein, Daniel Merritt Goldstein,
Melissa Catherine Goldstein, Herman Aubrey White, III, Tiffany
Leigh White, and Brittany Elisabeth White.
The remaining withdrawing members said that the response is being
filed for the sole purpose of insuring that a ruling approving the
Debtor's motion does not and will not prejudice, in any way the
remaining withdrawing members' rights as to the disputed factual
and legal issues as between the remaining withdrawing members and
the Debtor, which are proceeding to trial.
About PWK Timberland
Lake Charles, Louisiana-based PWK Timberland LLC sought Chapter 11
protection (Bankr. W.D. La. Case No. 13-20242) on March 22, 2013.
Gerald J. Casey, Esq., serves as counsel to the Debtor. The
Debtor disclosed $15,038,448 in assets and $1,792,957 in
liabilities as of the Chapter 11 filing.
RAYONIER ADVANCED: S&P Assigns BB+ CCR & Rates $500MM Notes BB+
---------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'BB+'
corporate credit rating to Rayonier Advanced Materials Inc.
(RYAM). The outlook is stable.
At the same time, S&P assigned its 'BB+' issue rating and recovery
rating of '4' to Rayonier A.M. Products Inc.'s (RAMP) proposed
$500 million senior unsecured notes due 2024. The recovery rating
indicates S&P expects average recovery (30%-50%) in the event of a
default. RAMP is a wholly owned subsidiary of RYAM.
"The stable outlook reflects our view that RYAM will generate
annual EBITDA at about $300 million over the next 12 to 18 months,
resulting in positive free cash flow, modest repayment of its term
loans, and the financial flexibility to pursue growth
initiatives," said Standard & Poor's credit analyst Tobias
Crabtree.
A downgrade could occur if S&P's forecast debt to EBITDA were to
exceed 4x and be sustained at that level. For this to occur,
EBITDA would have to be 35% below S&P's current forecast. S&P's
downside scenario contemplates RYAM's EBITDA margins in the low
20% area along with a prolonged period of excess supply and
declines of more than 10% for specialty cellulose prices in 2015-
2016 compared with 2014's anticipated levels.
An upgrade would most likely follow from debt to EBITDA being
sustained between 2x and 3x and FFO to debt above 30%, coupled
with more rapid absorption of the company's additional capacity.
A successful execution of the company's efforts to diversify its
product mix toward faster growing segments of the specialty
cellulose sector along with EBITDA 25% above S&P's current
forecast could result in a one-notch higher rating. In addition,
S&P would have to view the company's financial policy, especially
as it relates to growth initiatives, to be supportive of
sustaining a lower level of leverage.
RELIANCE INTERMEDIATE: Moody's Reviews 'B2' Rating for Downgrade
----------------------------------------------------------------
Moody's Investors Service placed Reliance Intermediate Holdings LP
("Holdings")'s Ba2 senior secured notes rating, and the Baa3
senior secured notes ratings of Holding's subsidiary, Reliance LP
(Reliance) on review for downgrade. The rating action follows the
company's announcement that it has signed an agreement to sell its
Reliance Protectron Inc. (Protectron) business, a provider of
residential and commercial electronic security systems to ADT
Corporation for C$555 million.
On Review for Downgrade:
Issuer: Reliance Intermediate Holdings LP
US$350M 9.5% Senior Secured Notes maturing due 2019, Ba2
Issuer: Reliance LP
C$30M 8.00% Senior Secured Notes due 2018, Baa3
US$185M 7.39% Senior Secured Notes due 2018, Baa3
Outlook Actions:
Issuers: Reliance Intermediate Holdings LP and Reliance LP
Changed To Rating Under Review From Stable
Ratings Rationale
The review will focus on Reliance's plans for disbursement of the
C$555 million proceeds from the pending sale of its security
systems business. With limited diversity and the loss of about a
quarter of EBITDA post-closing, Moody's expects the company will
need to operate with much lower leverage (adjusted Debt/EBITDA)
than its current 4.8x level in order to maintain the ratings. The
company's willingness to reduce debt above the minimum
requirements in its debt agreements will be a key consideration
when the review concludes.
Moody's has also corrected the seniority of the 2019 notes to
senior secured. The notes were previously misclassified as senior
unsecured due to an internal administrative error. The ratings of
these notes are not affected by this correction.
The principal methodology used in this rating was the Global
Business & Consumer Service Industry Rating Methodology published
in October 2010. Other methodologies used include Loss Given
Default for Speculative-Grade Non-Financial Companies in the U.S.,
Canada and EMEA published in June 2009.
Reliance operates two business segments; 1) water heater
installation and rentals, and heating, air conditioning and
ventilation installation and maintenance and 2) security and
monitoring (Protectron). Revenue for the year ended December 31,
2013 was C$583 million (C$417 million pro forma for the pending
sale of Protectron). The company is owned by Alinda Capital
Partners and is headquartered in Toronto, Ontario, Canada.
RESIDENTIAL CAPITAL: Dist. Court Tosses "Franklin" Pro Se Appeal
----------------------------------------------------------------
Tom Franklin appeals pro se from a Sept. 16, 2013 Order of the
U.S. Bankruptcy Court for the Southern District of New York
(Glenn, J.) expunging his claims against the chapter 11 estate of
Residential Capital, LLC and its affiliated debtors on the ground
of insufficient documentation. In a May 1 Opinion and Order
available at http://is.gd/HIeRs0from Leagle.com, District Judge
Paul A. Engelmayer affirmed the Order and denied Mr. Franklin's
appeal.
Mr. Franklin filed Claim No. 1195 on Oct. 12, 2012, in the amount
of $134,000. He listed "loan modification refused" as the basis
for his claim, but failed to supply any supporting documentation.
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. The Plan became effective on Dec. 17,
2013.
RIVERWALK JACKSONVILLE: May 14 Hearing in Chapter 11 Case
---------------------------------------------------------
Ashley Gurbal Kritzer, writing for the Jacksonville Business
Journal, reported that Riverwalk Jacksonville Development LLC's
bankruptcy filing may have been done to buy more time to sell
property or restructure its debt with two Miami-Dade County banks.
Stevan Pardo, managing partner of Riverwalk Jacksonville
Development LLC, had planned in 2007 a high-end condominium and
retail development on the Wyndham site. Those plans crashed along
with the real estate market. He chopped the property into
separate parcels and took out separate mortgages on each but only
defaulted on the hotel. A lender foreclosed on the hotel, but Mr.
Pardo is still the owner of the riverfront land and parking
surrounding the hotel. A team of Colliers International brokers
in South Florida and Jacksonville were marketing the land and
hotel, which the Business Journal reported was under contract to
be sold in January.
According to the report, one of Mr. Pardo's lenders, Miami-based
Sabadell United Bank, filed a lis pendens against Pardo, Riverwalk
Jacksonville Development LLC, Augusto Vidaurreta and Cyber One
Cafe LLC. Mellon United Bank, which Sabadell acquired in 2010,
issued a mortgage on the property in 2008 for $3.25 million,
according to court records.
The report also related that Doral-based U.S. Century Bank, which
is in "undercapitalized" condition and seeking to raise capital,
last modified a loan to the developer for $1.52 million in 2013.
The report says a hearing on the case is scheduled for May 14 at
11 a.m. in Miami.
Riverwalk Jacksonville Development, LLC, owner of the land and
parking surrounding the Wyndham RiverWalk Jacksonville, filed a
Chapter 11 bankruptcy (Bankr. S.D. Fla. Case No. 14-19672) on
April 28, 2014, in Miami. Stevan J. Pardo signed the petition as
managing member. The Debtor estimated assets of at least $10
million and debts of at least $1 million. Geoffrey S. Aaronson,
Esq., at Aaronson Schantz P.A. serves as the Debtor's counsel.
Judge Laurel M Isicoff oversees the case.
ROCKET SOFTWARE: Dividend Cancellation No Impact on Moody's CFR
---------------------------------------------------------------
Moody's Investors Service says Rocket Software Inc.'s cancellation
of its proposed dividend transaction did not impact the company's
B2 corporate family rating or existing debt ratings. The ratings
outlook remains negative however given the potential for the
company to revisit a debt funded equity distribution when market
conditions improve.
SBARRO LLC: Reaches Deal with Creditors, Amends Ch. 11 Plan
-----------------------------------------------------------
Sbarro LLC and its debtor affiliates amended their Joint
Prepackaged Chapter 11 Plan of Reorganization, to incorporate the
settlement reached with prepetition lenders and the Official
Committee of Unsecured Creditors regarding the treatment of
general unsecured claims.
General unsecured claims are impaired under the Plan. On account
of a settlement reached between and among the Debtors, the
Prepetition Agent, the Prepetition Secured Lenders, and the
Committee resolving all objections to confirmation of the Plan
raised by the Committee, in exchange for full and final
satisfaction, settlement, release, and discharge of each Allowed
General Unsecured Claim, each Holder of an Allowed General
Unsecured Claim will receive its Pro Rata share of the General
Unsecured Claims Settlement Distribution, which means an amount of
$1.25 million, which will be reduced by (x) the allowed fees and
expenses incurred by the Committee's retained professionals and
(y) the reasonable expenses incurred by the members of the
Committee.
The amended Plan also provides that the existing officers of the
Debtors as of the Petition Date will remain in their current
capacities as officers of the Reorganized Debtors, subject to the
ordinary rights and powers of the board of directors to remove or
replace them in accordance with the Debtors? organizational
documents and any applicable employment agreements; provided,
however, that the Debtors? Chief Financial Officer on the Petition
Date will be deemed to have resigned on the Effective Date
regardless of when such Chief Financial Officer shall have
actually resigned, and will be a Released Party for all purposes
of the Plan.
The U.S. Bankruptcy Court for the Southern District of New York
will consider, among other things, the adequacy of the Disclosure
Statement and confirmation of the Plan on May 19, 2014, at 10:00
a.m. prevailing Eastern Time. Objections are due May 12.
Sbarro initially planned to sell its assets but an auction was
cancelled after the lawyers of the pizza chain advised the
Bankruptcy Court that they did not receive any qualified
preliminary indications of interest by the April 14 bid deadline.
Tiffany Kary, writing for Bloomberg News, however, reported that a
financial adviser of Sbarro has said the chain has seen signs of
interest from 31 potential bidders ahead of the April 14 deadline.
The Bloomberg report, citing a filing by Moelis & Co. with the
Court, said of 114 possible buyers contacted, 31 signed
confidentiality agreements to learn more about Sbarro. Bill
Rochelle, the bankruptcy columnist for Bloomberg News, noted that
the pizza chain said it won't seek approval of its prepackaged
Plan if someone shows up by the April 14 deadline offering to
sponsor a more lucrative reorganization. Because of the
cancellation of the auction, previously scheduled for May 21, the
Debtors, in consultation with their lenders and the Creditors'
Committee, have decided to proceed directly to confirmation of the
pre-negotiated Plan without continuing the auction process.
Full-text copies of the Amended Plan and blacklined version of
that Plan dated May 2 is available at http://is.gd/bLmdTE
About Sbarro
Pizza chain Sbarro sought Chapter 11 bankruptcy protection
together with several affiliated entities (Sbarro LLC, Bankr.
S.D.N.Y. Lead Case No. 14-10557) on March 10, 2014, in Manhattan.
Bankruptcy Judge Martin Glenn presides over the Debtors' cases.
The bankruptcy filing came after Sbarro said in February it would
155 of the 400 restaurants it owns in North America.
Bankruptcy Judge Martin Glenn presides over the 2014 case. Nicole
Greenblatt, Esq., James H.M. Sprayregen, Esq., Edward O. Sassower,
Esq., and David S. Meyer, Esq., at Kirkland & Ellis, LLP,
represent Sbarro. Mark Hootnick, Brian Bacal, Gregory Doyle, and
Roger Wood at Moelis & Company, serve as Sbarro's investment
bankers. Loughlin Management serves as the financial advisors.
Prime Clerk LLC serves as claims and noticing agent, and
administrative advisor.
Melville, N.Y.- based Sbarro LLC listed $175.4 million in total
assets and $165.2 million in total liabilities. The petitions
were signed by Stuart M. Steinberg, authorized individual.
This is Sbarro's second bankruptcy filing in three years. The
corporate entity was then known as Sbarro Inc., which, together
with several affiliates, filed Chapter 11 petitions (Bankr.
S.D.N.Y. Lead Case No. 11-11527) on April 4, 2011, in Manhattan.
Sbarro Inc. disclosed $51,537,899 in assets and $460,975,646 in
liabilities in the 2011 petition.
Bankruptcy Judge Shelley C. Chapman presided over the 2011 case.
In the 2011 case, Edward Sassower, Esq., and Nicole Greenblatt,
Esq., at Kirkland & Ellis, LLP, served as the Debtors' general
bankruptcy counsel; Rothschild, Inc., as investment banker and
financial advisor; PriceWaterhouseCoopers LLP as bankruptcy
consultants; Marotta Gund Budd & Dzera, LLC, as special financial
advisor; Curtis, Mallet-Prevost, Colt & Mosle LLP as conflicts
counsel; Epiq Bankruptcy Solutions, LLC, as claims agent; and Sard
Verbinnen & Co as communications advisor.
Sbarro Inc. emerged from Chapter 11 protection seven months later,
in November 2011, after Judge Chapman confirmed a Plan of
Reorganization that handed ownership of the company to the pre-
bankruptcy first lien lenders. Under the terms of the Plan,
Sbarro reduced debt by approximately 73%, or $295 million (from
approximately $405 million to $110 million, plus any amounts
funded under a new money term loan facility), by converting 100%
of the outstanding amount of the $35 million post-petition debtor-
in-possession financing into an equal amount of a newly issued
$110 million senior secured exit term loan facility; and
converting approximately $173 million in prepetition senior
secured debt held by the Company's prepetition first lien lenders
into the remaining exit term loan facility and 100% of the common
equity of the reorganized company (subject to dilution by shares
issued under a management equity plan); and eliminating all other
outstanding debt.
In January 2014, Standard & Poor's Ratings Services lowered
Sbarro's corporate credit rating further into junk category -- to
'CCC-' from 'CCC+' -- with negative outlook; and The Wall Street
Journal reported pizza chain enlisted restructuring lawyers at
Kirkland & Ellis LLP and bankers at Moelis & Co.
On March 5, 2014, the Debtors commenced solicitation of the
Proposed Joint Prepackaged Chapter 11 Plan of Reorganization. The
Plan received near unanimous support from the Debtors' prepetition
secured lenders, with Holders of approximately 98% of the
outstanding Prepetition Secured Lender Claims in dollar amount
voting to accept the Plan.
On March 26, 2014, the United States Trustee appointed an official
committee of unsecured creditors, consisting of (i) Performance
Food Group, Inc., (ii) PepsiCo Sales, Inc., (iii) GGP Limited
Partnership, (iv) Simon Property Group, Inc., and (v) The Macerich
Company. The Committee is represented by Jay R. Indyke, Esq.,
Cathy R. Herschopf, Esq., Seth Van Aalten, Esq., and Alex
Velinsky, Esq., at Cooley LLP. Mesirow Financing Consulting, LLC
serves as its financial advisors.
Counsel for the Prepetition Agent and DIP Agent is Milbank, Tweed,
Hadley & McCloy LLP's Evan R. Fleck, Esq.
SE SHIRES: Bids for Trumpets Maker Due May 19
---------------------------------------------
S.E. Shires Inc., the maker of custom trumpets and trombones, has
struck an agreement to sell all of its business assets to Eastman
Brass Instruments LLC for $2,000,000. S.E. Shires will appear
before the Bankruptcy Court in Worcester, Mass., at a hearing on
May 21 at 10:00 a.m. to seek approval of the sale. Parties
interested in making a rival offer may submit a bid by May 19.
Counteroffers should be at least $2,060,000. The Debtor also
requires a $120,000 deposit. Information about the assets,
Eastman's offer and bidding requirements is available upon request
through Gina O'Nell, Esq. 508-898-1501.
S.E. Shires, Inc., based in Hopedale, Mass., filed for Chapter 11
bankruptcy (Bankr. D. Mass. Case No. 14-40715) on April 8, 2014,
listing total assets of $1.80 million and total liabilities of
$3.10 million. Judge Melvin S. Hoffman presides over the case.
Christine E. Devine, Esq., at Mirick, O'Connell, DeMaillie &
Lougee LLP, serves as the Debtor's counsel. The petition was
signed by Stephen E. Shires, president. A list of the Debtor's 20
largest unsecured creditors is available for free at
http://bankrupt.com/misc/mab14-40715.pdf
Bloomberg News reported that the Company's bank account was seized
by state authorities over $145,000 in unpaid taxes. The U.S.
Internal Revenue Service is owed $685,000, according to a court
filing.
Eastman is providing $230,000 in financing for the Chapter 11
effort.
SEANERGY MARITIME: Reports $7.5-Mil. Net Income in Fourth Quarter
-----------------------------------------------------------------
Seanergy Maritime Holdings Corp. reported net income of $7.47
million on $6.33 million of net vessel revenue for the three
months ended Dec. 31, 2013, as compared with a net loss of $117.02
million on $8.50 million of net vessel revenue for the same period
in 2012.
For the 12 months ended Dec. 31, 2013, the Company reported net
income of $10.90 million on $23.07 million of net vessel revenue
as compared with a net loss of $193.76 million on $55.61 million
of net vessel revenue during the prior year.
As of Dec. 31, 2013, the Company had $66.35 million in total
assets, $157.04 million in total liabilities and a $90.69 million
total shareholders' deficit.
A copy of the Form 6-K Report is available for free at:
http://is.gd/bIgxmn
About Seanergy
Athens, Greece-based Seanergy Maritime Holdings Corp. is an
international company providing worldwide seaborne transportation
of dry bulk commodities. The Company owns and operates a fleet
of seven dry bulk vessels that consists of three Handysize, two
Supramax and two Panamax vessels. Its fleet carries a variety of
dry bulk commodities, including coal, iron ore, and grains, as
well as bauxite, phosphate, fertilizer and steel products.
In its audit report on the consolidated financial statements for
the year ended Dec. 31, 2012, Ernst & Young (Hellas) Certified
Auditors Accountants S.A., in Athens, Greece, expressed
substantial doubt about Seanergy Maritime's ability to continue
as a going concern. The independent auditors noted that the
Company has not complied with the principal and interest
repayment schedule and with certain covenants of its loan
agreements, which in turn gives the lenders the right to call the
debt. "In addition, the Company has a working capital deficit,
recurring losses from operations, accumulated deficit and
inability to generate sufficient cash flow to meet its
obligations and sustain its operations."
The Company reported a net loss of US$193.8 million on US$55.6
million of net vessel revenue in 2012, compared with a net loss
of US$197.8 million on US$104.1 million of net vessel revenue in
2011.
SEARS HOLDINGS: Amends 2014 AIP and 2014 LTIP Plans
---------------------------------------------------
The Compensation Committee of the Board of Directors of Sears
Holdings Corporation approved the restatement of the Sears
Holdings Corporation Annual Incentive Plan document and the 2014
performance goals, measures, definitions and other particulars
under the AIP. The Compensation Committee also approved 2014
performance goals, measures, definitions and other particulars
under the Sears Holdings Corporation Long-Term Incentive Program,
the plan document for which was approved on April 27, 2011, and
2014 particulars under the Sears Holdings Corporation Cash Long-
Term Incentive Plan, the plan document for which was approved on
Feb. 12, 2013.
The AIP provides the opportunity for salaried and certain
corporate hourly employees of the Company, including its executive
officers, to receive an incentive award equal to a percentage of
his or her base salary or a dollar amount, subject to the
attainment of annual performance goals. Awards under the AIP
represent the right to receive cash or, at the discretion of the
Compensation Committee, shares of the Company's common stock in
lieu of cash or a combination of cash and common stock; except as
noted below with respect to Edward S. Lampert, chief executive
officer. The issuance of common stock under the AIP is contingent
on the availability of shares of stock under a stockholder-
approved plan of the Company providing for the issuance of shares
in satisfaction of AIP awards.
The 2014 LTIP provides the opportunity for participants to receive
a long-term incentive award equal to either a percentage of his or
her base salary or a dollar amount subject to the attainment of
performance goals for a three-year period. Awards under the 2014
LTIP represent the right to receive cash or, at the discretion of
the Compensation Committee, shares of the Company's common stock
in lieu of cash or a combination of cash and shares upon the
achievement of certain performance goals. The issuance of common
stock under the 2014 LTIP is contingent on the availability of
shares of stock under a stockholder approved plan of the Company
providing for the issuance of shares in satisfaction of 2014 LTIP
awards.
Additional information is available for free at:
http://is.gd/wu8huC
About Sears
Hoffman Estates, Illinois-based Sears Holdings Corporation
(Nasdaq: SHLD) -- http://www.searsholdings.com/-- operates full-
line and specialty retail stores in the United States and Canada.
Sears Holdings operates through its subsidiaries, including Sears,
Roebuck and Co. and Kmart Corporation. Sears Holdings also owns a
94 percent stake in Sears Canada and an 80.1 percent stake in
Orchard Supply Hardware. Key proprietary brands include Kenmore,
Craftsman and DieHard, and a broad apparel offering, including
such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer,
as well as the Apostrophe and Covington brands. It also has the
Country Living collection, which is offered by Sears and Kmart.
Kmart Corporation and 37 of its U.S. subsidiaries filed voluntary
Chapter 11 petitions (Bankr. N.D. Ill. Lead Case No. 02-02474) on
Jan. 22, 2002. Kmart emerged from chapter 11 protection on May 6,
2003, pursuant to the terms of an Amended Joint Plan of
Reorganization. John Wm. "Jack" Butler, Jr., Esq., at Skadden,
Arps, Slate, Meagher & Flom, LLP, represented the retailer in its
restructuring efforts. The Company's balance sheet showed
$16,287,000,000 in assets and $10,348,000,000 in debts when it
sought chapter 11 protection. Kmart bought Sears, Roebuck & Co.,
for $11 billion to create the third-largest U.S. retailer, behind
Wal-Mart and Target, and generate $55 billion in annual revenues.
Kmart completed its merger with Sears on March 24, 2005.
Sears Holdings reported a net loss of $1.36 billion in 2013, a net
loss of $930 million in 2012 and a net loss of $3.14 billion in
2011. As of Feb.1, 2013, the Company had $18.26 billion in total
assets, $16.07 billion in total liabilities and $2.18 billion in
total equity.
Moody's Investors Service in January 2014 downgraded Sears
Holdings Corporate Family Rating to Caa1 from B3. The rating
outlook is stable.
The downgrade reflects the accelerating negative performance of
Sears' domestic business with comparable sales falling 7.4% for
the quarter to date ending January 6th, 2014 compared to the prior
year. The company now expects domestic Adjusted EBITDA to decline
to a range of ($80 million) to $20 million for the fourth fiscal
quarter, compared with $365 million in the year prior period. For
the full year, Sears expects domestic Adjusted EBITDA loss between
$(308) million and $(408) million, as compared to $557 million
last year. Moody's expects full year cash burn (after capital
spending, interest and pension funding) to be around $1.2 billion
in 2013 and we expect Sears' cash burn to remain well above $1
billion in 2014. "Operating performance for fiscal 2013 is
meaningfully weaker than our previous expectations, and we expect
negative trends in performance to persist into 2014" said Moody's
Vice President Scott Tuhy. He added "While Sears noted improved
engagement metrics for its "Shop Your Way" Rewards program,
Moody's remains uncertain when these improved engagement metrics
will lead to stabilization of operating performance."
As reported by the TCR on March 26, 2014, Standard & Poor's
Ratings Services affirmed its ratings on the Hoffman Estate, Ill.-
based Sears Holdings Corp., including the 'CCC+' corporate credit
rating.
SEQUENOM INC: Chief Medical Officer to Retire
---------------------------------------------
Allan T. Bombard, M.D., chief medical officer of Sequenom, Inc.,
informed the Company that he will retire from employment with the
Company as of the Company's next annual meeting of stockholders on
June 10, 2014.
Dr. Bombard has served as the Company's chief medical officer
since January 2009 and as one of the Company's CLIA/CAP Laboratory
Directors since June 2010.
About Sequenom
Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a
life sciences company committed to improving healthcare through
revolutionary genetic analysis solutions. Sequenom develops
innovative technology, products and diagnostic tests that target
and serve discovery and clinical research, and molecular
diagnostics markets. The company was founded in 1994 and is
headquartered in San Diego, California.
Sequenom incurred a net loss of $107.40 million on $162.42 million
of total revenues for the year ended Dec. 31, 2013, as compared
with a net loss of $117.02 million on $89.69 million of total
revenues in 2012. The Company incurred a net loss of $74.13
million in 2011. As of Dec. 31, 2013, the Company had $144.70
million in total assets, $191.20 million in total liabilities and
a $46.50 million total stockholders' deficit.
SEQUENOM INC: Incurs $15.7 Million Net Loss in First Quarter
------------------------------------------------------------
Sequenom, Inc., filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $15.67 million on $46.27 million of total revenues for the
three months ended March 31, 2014, as compared with a net loss of
$29.36 million on $38.49 million of total revenues for the same
period in 2013.
The Company's balance sheet at March 31, 2014, showed $122.85
million in total assets, $181.49 million in total liabilities and
a $58.63 million total stockholders' deficit.
"We are pleased to see sequential improvements in volume, revenue,
gross margin and expenses during the quarter, an indication of
steady growth, and improving profitability and cash flow in 2014,"
said Paul V. Maier, Sequenom's CFO. "Our focus on profitable
volume and the efforts of our sales, managed care and billing and
collections teams are helping us improve our collection cycle and
reimbursement."
A copy of the Form 10-Q is available for free at:
http://is.gd/smLBpI
Additional information is available for free at:
http://is.gd/Y36Czo
About Sequenom
Sequenom, Inc. (NASDAQ: SQNM) -- http://www.sequenom.com/-- is a
life sciences company committed to improving healthcare through
revolutionary genetic analysis solutions. Sequenom develops
innovative technology, products and diagnostic tests that target
and serve discovery and clinical research, and molecular
diagnostics markets. The company was founded in 1994 and is
headquartered in San Diego, California.
Sequenom incurred a net loss of $107.40 million in 2013, a net
loss of $117.02 million in 2012 and a net loss of $74.13
million in 2011.
SERENITY CARE: PNC Bank Wins Default Judgment
---------------------------------------------
In the case, PNC BANK, NATIONAL ASSOCIATION, SUCCESSOR TO RBC BANK
(USA), SUCCESSOR TO RBC CENTURA BANK, Plaintiff, v. SERENITY CARE,
INC., AND MELVIN RICHARDSON, Defendants, Civil No. 13-0074-CG-B
(S.D. Ala.), District Judge Callie V. S. Granade granted PNC's
motion for default judgment against Serenity Care.
The complaint alleges that the bank or its predecessor loaned
Serenity Care $297,000 as evidenced by a Promissory Note dated
March 24, 2008, and that Serenity Care defaulted on the Note.
According to the complaint, as of Jan. 31, 2013, Serenity Care
owed plaintiff $261,907.28 plus attorney fees pursuant to the
Promissory Note. The $261,907.28 is composed of principal in the
amount of $234,835.00, plus interest in the amount of $32,499.60,
plus late charges in the amount of $14,201.66. The complaint
states that per diem interest of $45.66 will continue to accrue
thereafter. Count I of the complaint asserts a claim against
Serenity Care for breach of the promissory note. There is no
question but that these allegations actually state causes of
action and that the complaint contains a substantive, sufficient
basis for the relief sought.
Serenity Care moved to stay the action pending its Chapter 11
bankruptcy case. The case was stayed as to Serenity Care on March
1, 2013. While the case was stayed against Serenity Care, default
judgment was entered against the individual defendant, Melvin
Richardson. The stay as to Serenity Care was lifted when the
court received notice that Serenity Care's bankruptcy had been
dismissed. The court, upon lifting the stay, ordered Serenity
Care to file its answer to the complaint on or before April 2,
2014. Serenity Care failed to file any answer, and default was
entered against Serenity Care on April 10.
According to District Judge Granade, "the court finds that
plaintiff is entitled to judgment against Serenity Care for the
principal, interest and late fees claimed under the note. However,
because plaintiff has not provided sufficient detail for the court
to determine the reasonableness of the attorney's fees requested,
the court declines to enter judgment until such information is
provided. Accordingly, plaintiff is ordered to submit billing
records and an affidavit reflecting the time and rates that were
incurred." Once the court makes its finding with regard to the
requested attorney's fees, judgment will be entered, Judge Granade
said.
A copy of the District Court's April 30, 2014 Order is available
at http://is.gd/ZivApnfrom Leagle.com.
Serenity Care, Inc., filed for Chapter 11 bankruptcy (Bankr. S.D.
Ala. Case No. 13-00556) on Feb. 21, 2013, listing under $1 million
in both assets and debts. A copy of the petition is available at
http://bankrupt.com/misc/alsb13-00556.pdf Christopher Kern, Esq.,
and Robert M. Galloway, Esq. -- bgalloway@gallowayllp.com -- at
Galloway Wettermark Everest Rutens & Gaillard, served as the
Debtor's counsel.
PNC Bank, N.A., is represented by:
C. Lee Reeves, Esq.
George M. Neal, Jr., Esq.
Juan Carlos Ortega, Esq.
SIROTE & PERMUTT, P.C.
2311 Highland Avenue South
P.O. Box 55727
Birmingham, AL 35205
Tel: 205-930-5183
E-mail: lreeves@sirote.com
jneal@sirote.com
jortega@sirote.com
STACY'S INC: Has Agreement to Settle Sun Gro's $72,321 Claim
------------------------------------------------------------
Stacy's Inc. asks the U.S. Bankruptcy Court for the District of
South Carolina to approve its settlement agreement with Sun Gro
Horticulture Distribution, Inc.
A copy of the settlement agreement is available for free at:
http://bankrupt.com/misc/Stacys_449_318_appDebtorsettlement.pdf
Sun Gro has asserted an administrative claim against the Debtor in
the amount of $72,321.40. The Debtor has asserted claims against
Sun Gro on behalf of the bankruptcy estate in the amount of
$447,866.21 for preferential transfers and a claim against Sun Gro
on behalf of the bankruptcy estate in an amount of $43,726.85 for
avoidable post petition transfers.
Under the proposed settlement or compromise, the administrative
claim of Sun Gro will be deemed withdrawn by Sun Gro. Sun Gro
will pay the Debtor $82,726.85 in full resolution of the Debtor's
preference and post petition transfer actions. In addition,
Adversary Proceeding No. 13-80180-dd will be dismissed, with
prejudice, pursuant to entry of a court order approving the
settlement.
No hearing will be held unless a response, return, and objection
is timely filed and served, in which case, the Court will conduct
a hearing on May 14, 2014, at 2:00 p.m.
Sun Gro is represented by:
Robert E. Culver, Esq.
The Culver Law Firm, P.C.
575 King Street, Suite A
Charleston, SC 29403
Tel: (843) 853-9816
E-mail: Bob@culverlaw.net
On April 4, 2014, the Debtor filed a report on the Aug. 30, 2013
sale of its equipment, inventory, vehicles, intellectual property,
certain contract rights, transferable permits, receivables,
software, books and records, goodwill, and any unlisted assets not
specifically excluded in the asset purchase agreement to MG
Acquisition, Inc., for $15.83 million (includes working capital of
$585,006). A copy of the report is available for free at:
http://bankrupt.com/misc/Stacys_443_salereport.pdf
About Stacy's Inc.
Stacy's Inc., a commercial greenhouse in York, South
Carolina, filed a Chapter 11 petition on June 21 (Bankr. D. S.C.
Case No. 13-03600) in Spartanburg, South Carolina, with a deal to
sell the business for $17 million to Metrolina Greenhouses, absent
higher and better offers.
Stacy's -- http://www.stacysgreenhouses.com/-- had 16 acres of
greenhouses on three farms aggregating 260 acres in York, South
Carolina. The Debtor scheduled $26.4 million in total assets and
$31.4 million in liabilities as of the bankruptcy filing. The
secured lender is Bank of the West, owed $22.1 million secured by
liens on the assets.
The Debtor tapped Barbara George Barton, Esq., at Barton Law Firm,
P.A, as bankruptcy counsel; Ouzts, Ouzts & Varn, P.A., as its
financial advisor; SSG Advisors, LLC, as its investment banker;
and Faulkner and Thompson, P.A., to provide limited accounting
services.
The Official Committee of Unsecured Creditors retained Reid E.
Dyer, Esq., at Moore & Van Allen, PLLC.
Stacy's in August 2013 sold the business to MG Acquisition Inc.,
an affiliate of Metrolina Greenhouses, for $15.2 million after no
competing bids were entered at a bankruptcy auction. The sale
closed on Aug. 30, 2013.
STEREOTAXIS INC: Files Form 10-K, Incurs $68.7 Million 2013 Loss
----------------------------------------------------------------
Stereotaxis, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$68.75 million on $38.03 million of total revenue for the year
ended Dec. 31, 2013, as compared with a net loss of $9.23 million
on $46.56 million of total revenue during the prior year.
As of Dec. 31, 2013, the Company had $31.07 million in total
assets, $42.77 million in total liabilities and a $11.70 million
total stockholders' deficit.
Ernst & Young LLP, in St. Louis, Missouri, issued a "going
concern" qualification on the consolidated financial statements
for the year ended Dec. 31, 2013. The independent auditors noted
that the Company has incurred recurring operating losses and has a
net capital deficiency. These conditions raise substantial doubt
about the Company's ability to continue as a going concern.
A copy of the Form 10-K is available for free at:
http://is.gd/DiSAjg
Auditor's Consent
Stereotaxis filed an amendment to its annual report on Form 10-K
for the fiscal year ended Dec. 31, 2013 solely to include as an
exhibit the consent of the Company's independent registered public
accounting firm, Ernst & Young LLP that was inadvertently not
filed as an exhibit to the original Form 10-K.
Consent of Independent Registered Public Accounting Firm
"We consent to the incorporation by reference in the following
Registration Statements and the related prospectuses:
(1) Registration Statement (Form S-8 No. 333-161079) of
Stereotaxis, Inc. pertaining to the Stereotaxis, Inc.
2002 Stock Incentive Plan and the Stereotaxis, Inc. 2009
Employee Stock Purchase Plan
(2) Registration Statement (Form S-8 No. 333-186124) of
Stereotaxis, Inc. pertaining to the Stereotaxis, Inc.
2012 Stock Incentive Plan
(3) Registration Statement (Form S-3 No. 333-192606) of
Stereotaxis, Inc. pertaining to the registration of up
to $75 million of the Stereotaxis, Inc.'s common stock,
preferred stock, debt securities, warrants, and/or units
of our report dated March 27, 2014, with respect to the financial
statements and schedule of Stereotaxis, Inc., included in the
Annual Report (Form 10-K) for the year ended December 31, 2013."
A copy of the Form 10-K/A is available for free at:
http://is.gd/mxM8aM
About Stereotaxis
Based in St. Louis, Missouri, Stereotaxis, Inc., is a manufacturer
and developer of a suite of navigation systems in interventional
surgical procedures. The Company's Epoch Solution is used in the
treatment of arrhythmias and coronary artery disease.
SYMPHONY TELECA: S&P Assigns 'B' CCR & Rates $125MM Debt 'BB-'
--------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned a 'B'
corporate credit rating to Mountain View, Calif.-based Symphony
Teleca Corp. The outlook is stable.
S&P also assigned its 'BB-' issue-level rating and '1' recovery
rating to Symphony Teleca Services Inc.'s $115 million first-lien
term loan due 2019 and $10 million revolver also due 2019. The
'1' recovery rating indicates S&P's expectation of very high (90%-
100%) recovery in the event of payment default.
"Our ratings on Symphony Teleca Corp. reflect its 'weak' business
risk profile and 'highly leveraged' financial risk profile," said
Standard & Poor's credit analyst James Thomas.
S&P's business risk assessment is based on the company's small
scale in the highly competitive global business process
outsourcing (BPO) industry, and weak margins compared to those of
similarly sized peers with a focus on outsourced product
development (OPD). Favorable industry growth prospects, a high
level of revenue visibility, and positive free operating cash flow
(FOCF) are partial offsets. The financial risk assessment
incorporates pro forma leverage in the low 5x area (including
preferred equity, which S&P considers debt like, and 12 months of
Aditi EBITDA contribution).
The outlook is stable, reflecting S&P's expectation that Symphony
Teleca will successfully integrate the acquisition of Aditi and
grow revenues in line with the overall outsourced product
development market.
S&P would consider lowering the rating if competitive pressures or
continued weakness in the mobility segment leads to declining
profitability and margin compression, causing adjusted leverage to
approach 7x.
An upgrade is unlikely over the intermediate term given the
company's limited scale and diversity compared to the broader BPO
industry and S&P's expectation that financial sponsor ownership
will preclude sustained deleveraging.
TOMNICK REALTY: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Tomnick Realty Corp. 14-22629
3827 Crompond Road
Yorktown Heights, NY 10958
Tomnick Realty South Corp. 14-22630
512 Route 303
Orangeburg, NY 10962
Related cases that filed for bankruptcy in 2013:
Tomnick Food Services Inc. 13-22271
Tomnick Food Services North Inc. 13-22281
Tomnick Food Services South Inc. 13-22284
Chapter 11 Petition Date: May 6, 2014
Court: United States Bankruptcy Court
Southern District of New York (White Plains)
Judge: Hon. Robert D. Drain
Debtors' Counsel: Demetrios Adamis, Esq.
DEMETRIOS ADAMIS, PC
61-43 186th Street
Fresh Meadows, NY 11365
Tel: 718-425-0945
Email: dadamis@optonline.net
Total Total
Assets Liabilities
--------- -----------
Tomnick Realty Corp. $1.1MM $3.3MM
Tomnick Realty South Corp. $1.3MM $3.1MM
The petitions were signed by Tom Voutsas, president
The Debtors did not file a list of their largest unsecured
creditors when they filed the petitions.
TOYS R US: 2014 Could be Critical for Toy Seller's History
----------------------------------------------------------
Richard Collings, writing for The Deal, reported that for retailer
Toys 'R' Us Inc. the year 2014 could be the most critical in its
history as the Wayne, N.J. based toy seller is in the midst of the
longest time period passing without a meaningful debt maturity,
according to Moody's Investors Service Inc.'s analyst Charles
O'Shea.
But the company only has only so much time before it runs up
against its debt maturities and it will need to improve
operations, as well as show a quarterly sequential uptick in
revenue and profits when it comes to refinance, the Deal said,
citing the analyst.
The toy retailer's next meaningful debt maturities of slightly
under $1 billion come due in Sept. 2016, however, they become a
liquidity concern in early 2015, the Deal further cited O'Shea as
saying in an April 16 report.
Though the company has the liquidity to survive in the short-term,
it just had the worst fourth quarter in its history, O'Shea added,
the report related. That dragged down its entire fiscal year's
performance.
For the year ended Feb. 1, Toys 'R' Us generated about $12.5
billion in net sales, compared to about $13.5 billion for the same
period a year prior, while the company had a net loss of about $1
billion from net earnings of nearly $40 million for the same
period a year earlier, the company said in its earnings statement,
the report further related. Ebitda dropped for the fiscal year to
$35 million from about $960 million the year prior, while adjusted
Ebitda was nearly $600 million, down from about $1 billion.
Headquartered in Wayne, New Jersey, USA, Toys "R" Us is a leading
specialty toy and juvenile retailer, with annual revenues of
around $12.5 billion, roughly 40% of which are generated through
its International division.
The Troubled Company Reporter, on April 8, 2014, reported that
Moody's Investors Service downgraded the ratings of Toys "R" Us,
Inc., including the Corporate Family and Probability of Default
ratings, which were downgraded to B3 and B3-pd, respectively, from
B2 and B2-pd. The Speculative Grade Liquidity rating of SGL-2 was
unchanged. The outlook is negative.
TUOMEY HEALTHCARE: Facing Bankruptcy Amid $240MM Judgment
---------------------------------------------------------
The Associated Press, citing a Sumter Item report, said trustees
have told Tuomey Healthcare System CEO Michael Schwartz he could
pursue Chapter 11 bankruptcy if needed. A jury ruled last year
Tuomey made more than 21,000 false Medicare claims from 2005 to
2009. The hospital was ordered to pay almost $240 million in
reimbursement and fines, and required by a South Carolina federal
judge to set aside $70 million to continue its appeal from the
ruling to the U.S. Court of Appeals for the Fourth Circuit.
Tuomey is asking the Fourth Circuit to lower the amount it must
keep in reserves. Tuomey has said it would have to close if it
had to pay the full amount.
The AP report said Tuomey could file for bankruptcy as soon as
this month.
As reported by the Troubled Company Reporter on Feb. 7, 2014,
Standard & Poor's Ratings Services revised the outlook on its
'CCC' rating on South Carolina Jobs Economic Development
Authority's series 2006 revenue bonds, issued for Tuomey
Healthcare System, to negative from developing. The negative
outlook reflects Standard & Poor's view of Tuomey's legal risk
tied to a lawsuit with the federal government and decreasing
financial profile. At the same time, Standard & Poor's affirmed
its 'CCC' rating on the authority's debt, issued for the system.
"We believe reserves could decrease further, leaving the health
system with very limited financial flexibility. We also recognize
that operating performance is very weak and that there is a
possibility Tuomey could file bankruptcy should it deplete cash
reserves," said Standard & Poor's credit analyst Margaret
McNamara. "We could lower the rating if Tuomey were to file for
bankruptcy or if it were to default on principal and interest
payments. Although not expected over the next year, we could
raise the rating over a longer period if Tuomey's lawsuit were to
shift in its favor and if financial performance were to begin to
show a positive trend."
On Oct. 2, 2013, Standard & Poor's lowered the rating on Tuomey's
debt to 'CCC' and assigned a developing outlook after the courts
denied Tuomey's request for an appeal and granted the federal
government's request to impose up to $277 million of damages.
Since then, the courts have required Tuomey to set aside
$50 million in escrow during the appeals process. The government
is now asking Tuomey to set aside an additional $20 million, a
request Tuomey has appealed.
Standard & Poor's understands Tuomey would be at risk of violating
several bond covenants if the courts grant the government's
request. While the rating service understands Tuomey is
continuing to work toward a settlement, significant uncertainty
remains as to whether the parties will reach an agreement that
Tuomey finds acceptable.
US SHIPPING: Moody's Raises Corporate Family Rating to 'B3'
-----------------------------------------------------------
Moody's Investors Service raised its ratings assigned to U.S.
Shipping Corp ("USSC"): Corporate Family Rating (CFR) to B3 from
Caa1; Probability of Default Rating (PDR) to B3-PD from Caa1-PD;
and first lien senior secured rating to B2, 39-LGD3 from B3, 40,
LGD3. The outlook is stable.
Ratings Rationale
The upgrade of the ratings follows the company' steady operating
performance through 2013, maintaining high utilization of its
seven US Jones Act qualified vessels and generating modest
positive free cash flow generation. Moody's expect demand for the
company's vessels to remain strong through at least 2015,
facilitating modest expansion of margins and ongoing free cash
flow that will be applied to debt reduction, leading to further
strengthening of credit metrics within the single B rating
category.
The B3 CFR balances the company's small size, mid- to low-single B
credit metrics profile and favorable fundamentals of the US Jones
Act shipping sector. The US' shale oil revolution, reductions in
refinery capacity in the mid-Atlantic states and strong
petrochemical production supported by relatively low natural gas
prices will continue to sustain demand for coastwise
transportation of crude, refined products and chemicals. The
company's vessels ply mainly in the chemical trade and mostly
under contracts, making them less susceptible to potential
fluctuations in demand for coastwise movements of crude or refined
products than those operators focused on these commodities.
Moody's anticipate that USSC will be able to modestly expand
revenues and EBITDA generation through 2015 as demand growth
continues to outstrip supply growth in the US Jones Act market in
upcoming years. However, new vessels will enter the U.S. Jones Act
fleet in upcoming years, which could push older tonnage into the
chemical trades, possibly increasing competition for USSC. Moody's
also expect free cash flow generation to fluctuate with the number
of dry-docks performed each year and in years when any of the
three older tankers go through their dry-docks. Liquidity is
adequate.
The stable outlook reflects Moody's belief that the majority of
USSC's fleet is likely to remain on contract with freight rates
that allow the company to achieve about $15 million to $20 million
of annual free cash flow in years when dry-dockings of the
company's older vessels do not occur. Free cash flow should remain
positive in years when the older vessels are dry-docked.
A positive rating action could occur if USSC was to strengthen its
credit metrics profile, such as having Funds from Operations +
Interest to Interest approach 3.0 times and Debt/EBITDA below 5.0
times. The chartering strategy locks in the majority of the
company's revenue for upcoming years, leaving limited opportunity
to trade its way to a stronger credit metrics profile with its
current fleet. A negative rating action could occur if the company
does not maintain strong daily utilization of the fleet such that
it sustains negative free cash flow. Debt-funded fleet growth
could also pressure the rating as could a weakening of credit
metrics, such that Debt to EBITDA was sustained above 6.0 times or
Funds from Operations + Interest to Interest approached 1.0 time.
U.S. Shipping Corp, headquartered in Edison, NJ, owns four
articulated tug-barge units and three tankers serving the US Jones
Act chemical and petroleum markets.
WARNER MUSIC: Elects Three New Directors
----------------------------------------
Warner Music Group Corp. announced the election of three new
directors: Mathias Dopfner, Chairman and CEO of Axel Springer SE;
Noreena Hertz, noted economist, strategist, and author; and Oliver
Slipper, Joint CEO of Perform Group PLC. With these appointments,
the WMG Board increases from eight to 11 members.
Len Blavatnik, Chairman & Founder of Access Industries, commented:
"Mathias, Noreena, and Oliver are all noted business innovators
with unique global perspectives. They are strong additions to the
board team and their guidance will help chart our course as the
most nimble and artist-friendly music company."
Steve Cooper, CEO of WMG, commented: "I am very pleased to welcome
these three highly accomplished and knowledgeable leaders to our
Board of Directors. With their combined rich backgrounds in
media, entertainment, and economics, they bring us a wealth of
expertise and a range of insight that will be invaluable as we
continue to grow WMG and nurture the careers of songwriters and
artists."
Mathias Dopfner is Chairman and CEO of global media and publishing
company Axel Springer SE, based in Berlin. He joined Axel
Springer in 1998 as Editor-in-Chief of Die Welt, has been a member
of the company's management board since 2000, and was appointed
CEO in 2002. Since then, he has implemented a radical digital
transformation strategy which has led to digital media
contributing to more than 60% of Axel Springer Group's profits.
Dopfner was previously Editor-in-Chief of the newspapers
Wochenpost and Hamburger Morgenpost. He began his career as a
journalist at Frankfurter Allgemeine Zeitung and later worked on
the staff of the publishing company Gruner+Jahr in both Paris and
Hamburg. Dopfner studied Musicology, German, and Theatrical Arts
in Frankfurt and Boston. He is a member of the Board of Directors
of Time Warner Inc., a member of the Board of Directors of RHJ
International SA, and holds several honorary positions, including
offices at the American Academy, the American Jewish Committee,
and the European Publishers Council (EPC). In 2010, Dopfner was
Visiting Professor in Media at the University of Cambridge and
became a member of St. John's College. With his publications he
has stirred international debates on the future of journalism and
the content industry in the evolving digital landscape.
Noreena Hertz advises major organizations and global figures on
strategy, decision-making, corporate social responsibility, and
global economic and geo-political trends. Her best-selling books,
Eyes Wide Open, The Silent Takeover, and IOU: The Debt
Threat, have been published in 20 countries. Professor Hertz has
served on Citigroup's Politics and Economics Global Advisory Board
and on the Advisory Group steering the HJI Task Force for
Inclusive Capitalism. She is also a Trustee of the UK think tank
IPPR. A noted media commentator, she has also given keynote
speeches at TED and The World Economic Forum. Hertz holds an MBA
from the Wharton School of the University of Pennsylvania and a
Ph.D. from the University of Cambridge. Having spent 10 years at
the University of Cambridge as Associate Director of the Centre
for International Business and Management, she recently moved to
University College London, where she is Honorary Professor at the
Centre for the Study of Decision-Making.
Oliver Slipper was appointed to the Board of Perform Group PLC,
the digital media sports company, in 2007 and currently serves as
Joint CEO. He was formerly the CEO of Premium TV until its
amalgamation with Inform Group to create Perform. Together with
Joint CEO Simon Denyer, Slipper took Perform public, achieving a
listing on the London Stock Exchange in 2011, with a market
capitalization of over oe500m. Slipper joined Premium TV in 2001
as Commercial Manager, launching the company's web-TV and mobile
services, and was appointed CEO in 2005. Prior to Premium TV,
Slipper worked at Accenture within the Media and Entertainment
team, advising on digital strategies for clients including Cable &
Wireless, NTL, and Sony PlayStation. Slipper holds a BA (Hons) in
Classical Studies from Manchester University.
Mathias Dopfner will be entitled to an annual retainer of
EUR250,000, payable pro rata quarterly in arrears, for his service
as a director on the Company's Board. All of the new directors
will be entitled to reimbursement of their fees and expenses,
including fees incurred in connection with travel to meetings.
Additional information is available for free at:
http://is.gd/bx0FK8
About Warner Music Group
Based in New York, Warner Music Group Corp. (NYSE: WMG)
-- http://www.wmg.com/-- was formed by a private equity
consortium of investors on Nov. 21, 2003. The Company is the
direct parent of WMG Holdings Corp., which is the direct parent of
WMG Acquisition Corp. WMG Acquisition Corp. is one of the world's
major music-based content companies and the successor to
substantially all of the interests of the recorded music and music
publishing businesses of Time Warner Inc.
The Company classifies its business interests into two fundamental
operations: Recorded Music and Music Publishing. The Company's
Recorded Music business primarily consists of the discovery and
development of artists and the related marketing, distribution and
licensing of recorded music produced by such artists. The
Company's Music Publishing operations include Warner/Chappell, its
global Music Publishing company, headquartered in New York with
operations in over 50 countries through various subsidiaries,
affiliates and non-affiliated licensees.
In May 2011, Warner Music Group Corp. and Access Industries, the
U.S.-based industrial group, announced the execution of a
definitive merger agreement under which Access Industries will
acquire WMG in an all-cash transaction valued at $3.3 billion.
The purchase includes WMG's entire recorded music and music
publishing businesses.
On July 20, 2011, the Company notified the New York Stock
Exchange, Inc., of its intent to remove the Company's common stock
from listing on the NYSE and requested that the NYSE file with the
SEC an application on Form 25 to report the delisting of the
Company's common stock from the NYSE. On July 21, 2011, in
accordance with the Company's request, the NYSE filed the Form 25
with the SEC in order to provide notification of that delisting
and to effect the deregistration of the Company's common stock
under Section 12(b) of the Securities Exchange Act of 1934, as
amended. On August 2, 2011, the Company filed a Form 15 with the
SEC in order to provide notification of a suspension of its duty
to file reports under Section 15(d) of the Exchange Act. The
Company continues to file reports with the SEC pursuant to the
Exchange Act in accordance with certain covenants contained in the
instruments governing the Company's outstanding indebtedness.
Warner Music reported a net loss attributable to the Company $198
million on $2.87 billion of revenues for the fiscal year ended
Sept. 30, 2013, as compared with a net loss attributable to the
Company of $112 million on $2.78 billion of revenues for the
fiscal year ended Sept. 30, 2012. As of Sept. 30, 2013, the
Company had $6.25 billion in total assets, $5.50 billion in total
liabilities and $743 million in total equity.
* * *
As reported by the TCR on March 28, 2014, Standard & Poor's
Ratings Services affirmed its 'B+' corporate credit rating on
recorded music and music publishing company Warner Music Group
Corp. (WMG). S&P's rating and negative outlook reflect continued
uncertainty surrounding industry wide revenue and profitability
trends affecting WMG over the intermediate term, despite recent
signs of stabilization in the industry.
WEST CORP: Reports $46.3 Million Net Income in First Quarter
------------------------------------------------------------
West Corporation filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing net income
of $46.27 million on $676.15 million of revenue for the three
months ended March 31, 2014, as compared with net income of $3.05
million on $660.24 million of revenue for the same period in 2013.
The Company's balance sheet at March 31, 2014, showed $3.54
billion in total assets, $4.25 billion in total liabilities and a
$709.40 million total stockholders' deficit.
Bankruptcy Warning
"If we cannot make scheduled payments on our debt, we will be in
default, and as a result:
* our debt holders could declare all outstanding principal and
interest to be due and payable;
* the lenders under our Senior Secured Credit Facilities could
terminate their commitments to lend us money and foreclose
against the assets securing our borrowings; and
* we could be forced into bankruptcy or liquidation."
A copy of the Form 10-Q is available for free at:
http://is.gd/5IKnId
About West Corporation
Founded in 1986 and headquartered in Omaha, Nebraska, West
Corporation -- http://www.west.com/-- provides outsourced
communication solutions to many of the world's largest companies,
organizations and government agencies. West Corporation has a
team of 41,000 employees based in North America, Europe and Asia.
West Corp posted net income of $143.20 million in 2013, as
compared with net income of $125.54 million in 2012.
* * *
As reported by the TCR on June 21, 2013, Standard & Poor's Ratings
Services raised its corporate credit rating on Omaha, Neb.-based
business process outsourcer West Corp. to 'BB-' from 'B+'. The
upgrade reflects Standard & Poor's view that lower debt leverage
and a less aggressive financial policy will strengthen the
company's financial profile.
In the April 4, 2013, edition of the TCR, Moody's Investor Service
upgraded West Corporation's Corporate Family Rating to B1 from B2.
"The CFR upgrade to B1 reflects West's shift to a more
conservative capital structure and financial policies as a
publicly owned company", stated Moody's analyst Suzanne Wingo.
WESTMORELAND COAL: Acquires Sherritt Coal Operations
----------------------------------------------------
Westmoreland Coal Company has completed the acquisition of
Sherritt International's Prairie and Mountain coal mining
operations, which include seven producing thermal coal mines in
the Canadian provinces of Alberta and Saskatchewan, a 50 percent
interest in an activated carbon plant and a Char production
facility. Together with Westmoreland's existing U.S. operations,
the acquisition places the firm as North America's sixth largest
coal producer.
"We are pleased that the long process of closing this transaction
is now complete," said Keith E. Alessi, Westmoreland's CEO. "Over
the past several months, we have met with employees, union
representatives, customers and joint venture partners of the
newly-acquired business. I am encouraged by their enthusiasm and
willingness to work with Westmoreland as we forge long term,
mutually beneficial relationships. I am personally grateful for
the efforts of all the parties who worked to complete this
transaction and am enthusiastic about what this addition to our
business means for our future."
Concurrent with the closing of the acquisition, the proceeds from
the previously announced private offering of $425 million in
aggregate principal amount of 10.75 percent Senior Secured Notes
were released from escrow. The escrowed funds were to be released
upon satisfaction of all conditions precedent to the acquisition,
receipt of regulatory approvals and certain other conditions, all
of which were satisfied. Those notes were initially issued by
Westmoreland Escrow Corporation, a subsidiary of Westmoreland, and
as a result of the closing of the acquisition, are being
automatically exchanged for identical notes issued by Westmoreland
and Westmoreland Partners, as co-issuers.
The notes were offered only to qualified institutional buyers
under Rule 144A of the Securities Act of 1933, as amended and to
buyers outside the United States pursuant to Regulation S under
the Securities Act. The notes have not been registered under the
Securities Act, and until so registered, the notes may not be
offered or sold in the United States except pursuant to an
exemption from the registration requirements of the Securities Act
and applicable state securities laws.
Prepayment of WML Notes and
Termination of WML Credit Facility
As part of the Senior Secured Notes offering, Westmoreland Mining
LLC, or WML, a wholly owned subsidiary of Westmoreland, announced
that it has provided prepayment notices to holders of its 8.02
percent senior secured notes due 2018. That debt will be prepaid
by the end of May and all collateral secured under such debt will
become collateral under Westmoreland's 10.75 percent Senior
Secured Notes. Westmoreland will also terminate WML's existing
$25 million credit facility prior to prepaying the WML notes.
Additional information is available for free at:
http://is.gd/8DkHOS
About Westmoreland Coal
Colorado Springs, Colo.-based Westmoreland Coal Company (NYSE
AMEX: WLB) -- http://www.westmoreland.com/-- is the oldest
independent coal company in the United States. The Company's coal
operations include coal mining in the Powder River Basin in
Montana and lignite mining operations in Montana, North Dakota and
Texas. Its power operations include ownership of the two-unit
ROVA coal-fired power plant in North Carolina.
Westmoreland Coal incurred a net loss applicable to common
shareholders of $6.05 million in 2013, a net loss
applicable to common shareholders of $8.58 million in 2012 and a
net loss applicable to common shareholders of $34.46 million in
2011.
* * *
As reported by the TCR on Nov. 6, 2012, Standard & Poor's
Ratings Services raised its corporate credit rating on Englewood,
Co.-based Westmoreland Coal Co. (WLB). to 'B-' from 'CCC+'.
"The upgrade reflects our view that WLB is less vulnerable to
default after successfully negotiating less restrictive covenant
requirements for an unrated $110 million term loan due 2018," said
credit analyst Gayle Bowerman. "Our assessment of WLB's business
risk profile as 'vulnerable' and financial risk profile as 'highly
leveraged' are unchanged. We also revised our liquidity score to
'adequate' based on the covenant relief and additional liquidity
provided under the company's new $20 million asset-based loan
(ABL) facility from 'less than adequate'."
Westmoreland Coal carries a Caa1 corporate family rating from
Moody's Investors Service.
WHEATLAND MARKETPLACE: May Sell Real Properties for $10.1 Million
-----------------------------------------------------------------
Bankruptcy Judge Pamela S. Hollis authorized Wheatland
Marketplace, LLC, to sell parcels of real estate located at:
(1) 3124 South Route 59, Naperville, Illinois; (2) Part of 3224
South Route 59, Naperville, Illinois; and (3) 3204 South Route 59,
Naperville, Illinois to ArciTerra Properties, LLC, for
$10,132,900.
A copy of the sale contract is available for free at
http://bankrupt.com/misc/Wheatland_SaleContract.pdf
The Debtor is also authorized to pay $662,900 as acquisition fee
to ArciTerra Strategic Retail Advisor, LLC.
The properties are subject to pre-existing mortgage and liens of
U.S. Bank National Association, as trustee successor to Bank of
America, National Association, successor by merger to LaSalle Bank
National Association, as Trustee for Bear Stearns Commercial
Mortgage Securities, Inc., Commercial Mortgage Pass-Through
certificates, Series 2003 TOP12 acting by and through C-III
Asset Management, LLC (formerly known as ARCap Servicing, Inc.),
the primary lender, which secures a note with a current
approximate balance in the amount of $7,013,354.
The Debtor proposed that, after payment of customary closing
costs, all net proceeds of the sale will be sufficient to pay
mortgage lender in full as all other unsecured claims.
The Debtor is represented by:
Thomas W. Toolis of Jahnke
SULLIVAN & TOOLIS, LLC
10075 W. Lincoln Highway
Frankfort, IL 60423
Tel: (708) 349-9333
Fax: (708) 349-8333
About Wheatland Marketplace, LLC
Wheatland Marketplace, LLC, owner of a commercial retail center in
Naperville, Illinois, filed a Chapter 11 bankruptcy petition
(Bankr. N.D. Ill. Case No. 13-46492) in Chicago on Dec. 3, 2013.
The Debtor has tapped Thomas W. Toolis, Esq., at Jahnke, Sullivan
& Toolis, LLC, in Frankfurt, Illinois, as counsel. Coleen J.
Lehman Trust and Lucy Koroluk each holds a 50% membership interest
in the Debtor. The Debtor reported $10,999,006 in total assets,
and $7,052,778 in total liabilities.
No committee of unsecured creditors has been appointed to serve in
the case.
WHITE OAKS CHARLES PLACE: Case Summary & 2 Top Unsec. Creditors
---------------------------------------------------------------
Debtor: White Oaks of Charles Place, LLC
P.O. Box 2821
Cumming, GA 30040
Case No.: 14-21085
Chapter 11 Petition Date: May 5, 2014
Court: United States Bankruptcy Court
Northern District of Georgia (Gainesville)
Debtor's Counsel: William A. Rountree, Esq.
MACEY, WILENSKY & HENNINGS LLC
Suite 4420, 303 Peachtree Street, NE
Atlanta, GA 30308
Tel: 404-584-1200
Fax: 404-681-4355
Email: mharris@maceywilensky.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Leigh Joya, managing member.
A list of the Debtor's two largest unsecured creditors is
available for free at http://bankrupt.com/misc/ganb14-21085.pdf
WITHOUT WALLS INT'L CHURCH: Heads for Auction
---------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Without Walls International Church Inc., a
nondenominational Christian church in Tampa, Florida, will be sold
at auction after filing for Chapter 11 protection March 10.
According to the report, in addition to the main property and
sanctuary on West Columbus Drive in Tampa, the church has 63 acres
in Lakeland, Florida. Both properties are collateral for $26
million in loans owed to Evangelical Christian Credit Union.
The properties will go up for auction separately and together, the
report related. The lender will be entitled to bid using its
secured claim up to specified, undisclosed amounts on each
property, if the bankruptcy judge in Tampa accedes to the
proposal.
If the lender ends up buying both, $100,000 in cash will be set
aside for the bankrupt church, the report further related. If
third parties are the buyers, more will be left for creditors and
the costs of the Chapter 11 effort.
The case is In re Without Walls International Church Inc., 14-bk-
02567, U.S. Bankruptcy Court, Middle District of Florida (Tampa).
YRC WORLDWIDE: Reports $88.3 Million Net Loss in First Quarter
--------------------------------------------------------------
YRC Worldwide Inc. filed with the U.S. Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
attributable to common shareholders of $88.3 million on $1.21
billion of operating revenue for the three months ended March 31,
2014, as compared with a net loss attributable to common
shareholders of $24.5 million on $1.16 billion of operating
revenue for the same period in 2013.
As of March 31, 2014, the Company had $2.21 billion in total
assets, $2.57 billion in total liabilities and a $363.1 million
total shareholders' deficit.
"We faced numerous challenges during the first quarter as we
battled both the distractions from the ratification of the
Memorandum of Understanding (MOU) along with Mother Nature," said
YRC Worldwide CEO James Welch. "This was one of the worst winter
seasons in my more than 30 years in trucking. We estimate that it
negatively impacted our operating income by approximately $20
million. The main culprits were lower volumes, decreased
productivities and higher use of purchased transportation," stated
Welch.
"The good news is that during the first quarter of 2014, we laid
the foundation for our future operational improvements based on
changes provided by the recently ratified MOU, more specifically
the establishment of a uniform national attendance policy, payment
of vacation based on the number of hours worked and, to a lesser
extent, our new over-the-road purchased transportation policy,"
continued Welch. "I am pleased with the progress we've made
during the first quarter in implementing these new policies;
however, because the MOU was ratified halfway through the quarter,
there were little, if any, positive impacts on year-over-year
results. I believe it will take the better part of 12 months
before we experience the full effect of the operationally-related
policy changes," said Welch.
A copy of the Form 10-Q is available for free at:
http://is.gd/3pkXja
About YRC Worldwide
Headquartered in Overland Park, Kan., YRC Worldwide Inc. (NASDAQ:
YRCW) -- http://www.yrcw.com/-- is a holding company that offers
its customers a wide range of transportation services. These
services include global, national and regional transportation as
well as logistics.
The Company incurred a net loss of $83.6 million in 2013 following
a net loss of $136.5 million in 2012.
* * *
As reported by the TCR on Feb. 18, 2014, Moody's Investors Service
has upgraded the Corporate Family Rating for YRC Worldwide Inc.
("YRCW") from Caa3 to B3, following the successful closing of its
refinancing transactions.
In the Jan. 31, 2014, edition of the TCR, Standard & Poor's
Ratings Services said that it raised its ratings on Overland Park,
Kansas-based less-than-truckload (LTL) trucker YRC Worldwide Inc.
(YRCW), including the corporate credit rating to 'CCC+' from
'CCC', and removed them from CreditWatch negative, where they were
placed on Jan. 10, 2014. "The upgrades reflect YRCW's improved
liquidity position and minimal debt maturities as a result of its
proposed refinancing," said Standard & Poor's credit analyst Anita
Ogbara.
* Fitch Says North Las Vegas Faces Same Factors That Led to Ch.11
-----------------------------------------------------------------
North Las Vegas faces the same four factors common to the
bankruptcies in Harrisburg, Stockton, and Detroit, according to a
new Fitch Ratings report.
Flawed financial decisions, rigid and escalating cost structures,
revenue raising limitations and weak economic conditions - playing
out over many years - contributed to all three recent bankruptcies
and may indicate risk for similarly distressed cities like North
Las Vegas.
Fitch currently rates North Las Vegas' general obligations 'B'
with a Negative Rating Outlook.
'North Las Vegas, while not in default, is nearing insolvency, and
Fitch's rating indicates that material default risk is present.
The city's dire fiscal picture stems from a steep drop in revenues
due to the severity of the recession coupled with multiyear
contracted compensation increases,' said Matthew Reilly, Director.
'The city also faces a structural budget deficit, one-time
expenses, and restrictions on certain revenue-raising measures.'
For Harrisburg, Stockton and Detroit, management's ability to
avoid insolvency was constrained by financial decisions made years
before that increased city liabilities without corresponding
decisions on how to fund those obligations.
Reactions to deteriorating economic and financial conditions were
slowed in those cities due to discord among management, political
leaders or labor.
These cities were also unable to sufficiently shed costs to
maintain the financial capacity needed to continue meeting their
obligations.
Weak economic conditions in Harrisburg, Stockton and Detroit led
to declining city revenues and contributed to overall fragility by
limiting prospects for future revenue growth and increasing
demands for city services.
Constraints on generating additional revenue due to legal
restrictions, political unwillingness to increase taxes, practical
limitations or a depressed tax base limited each city's ability to
raise new revenues to meet financial obligations.
The full special report titled 'Default: Common Factors That Led
to Bondholder Losses in Harrisburg, Stockton and Detroit' is
available on the Fitch Ratings web site.
* April Bankruptcy Filings in Rochester, NY Drop 19%
----------------------------------------------------
Will Astor, writing for Rochester Business Journal, reported that
Rochester-area bankruptcy filings fell in April and, continuing a
long-term trend, are down for the year. The 161 new bankruptcy
cases filed in the Western District of New York's Rochester
division reflected a 19.1 percent drop from the 199 cases filed in
the region a year ago. Area filings for the first four months of
2014 dropped 18.2 percent drop to 571, from 698 during the same
period in 2013. The region's bankruptcy filings in April included
127 Chapter 7 cases and 34 Chapter 13 filings. No Chapter 11 cases
were filed. The Bankruptcy Court's Rochester division spans nine
counties -- Monroe, Livingston, Ontario and Wayne counties, as
well as Chemung, Seneca, Schuyler, Steuben and Yates counties.
* KPMG Buys Southfield-Based Turnaround Consultancy BBK
-------------------------------------------------------
JC Reindl, writing for The Detroit Free Press, reported that
turnaround consulting firm BBK of Southfield has been bought and
folded into KPMG, the international accounting and advisory firm.
According to the report, as part of the deal, finalized on May 5,
BBK staff are joining KPMG's business restructuring team at its
downtown Detroit office at 150 W. Jefferson.
KPMG declined to disclose the financial terms, number of BBK
employees, or other staffing considerations, the report related.
It said that with the takeover it will have 330 employees in
Detroit.
BBK's CEO Bill Diehl will be a managing director and coleader of
the restructuring team, the report further related.
Founded in Southfield, BBK was known for its work with industrial
clients, particularly the auto industry, and its consultants were
a familiar sight on the shop floors and in the executives suites
of distressed Chrysler and General Motors suppliers, the report
added.
*********
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.
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