/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/140512.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, May 12, 2014, Vol. 18, No. 130 Headlines 21ST CENTURY: Moody's Places 'B3' CFR on Review for Upgrade 21ST CENTURY: S&P Revises Outlook to Positive & Assigns 'B-' CCR 24/7/365 BANDWIDTH: Public Auction of Assets on Wednesday 59TH AVE & PEORIA: Foreclosure Sale Set for June 20 911 NORTH BUFFALO: Case Summary & 3 Largest Unsecured Creditors ABOUND SOLAR: Internal Report Slams U.S. Handling of Guarantees ALLENS INC: PACA Can't Be Stretched Far Enough to Help Farmer ALTEGRITY INC: S&P Lowers CCR to 'CC'; Outlook Negative AMERISERV FINANCIAL: Fitch to Withdraw 'bb' Viability Rating ANCHOR GLASS: S&P Assigns 'B+' Corp. Credit Rating ANTIOCH COMPANY: Former Execs Lose Bonus Protection Bid ARCH COAL: Fitch Cuts Issuer Default Rating to 'CCC' ASCEND LEARNING: Moody's Rates New $125MM 2nd Lien Debt 'Caa2' ASCEND LEARNING: S&P Assigns 'CCC+' Rating to 2nd Lien Loan ATLS ACQUISITION: Medco Wants Contract Decision by May 30 AUC CAMELBACK: RepublicBankAz to Conduct Foreclosure Sale May 30 AUTHENTIC BRANDS: Moody's Assigns 'B2' Corporate Family Rating AUTHENTIC BRANDS: S&P Assigns 'B' CCR & Rates $365MM Debt 'B+' AUTO ORANGE: Creditors Appeal Order Dismissing Ch.11 Case AVS SUPPLY: Real Property Auction Today BERNARD L. MADOFF: Ex-Aides Seek Acquittal After Guilty Verdict BERNARD L. MADOFF: UK Court Rejects Feeder Fund's Clawback Suit BOB & STAN: Condo Units in Goodyear, AZ to Be Sold May 20 BROWNSVILLE MD: Part Owners Balk at Pineda's Bid for Stay Relief BUILDING MATERIALS: S&P Revises Outlook to Pos. & Affirms 'B' CCR CANDY INTERMEDIATE: Moody's Lowers CFR to 'B3'; Outlook Stable CANYON COMPANIES: Moody's Assigns 'B2' Corp. Family Rating COOPER-BOOTH: Has May 14 Confirmation for 100% Plan DETROIT, MI: Pension Deal Approved by One Retirement System DETROIT, MI: $1.45 Billion Pension Debt Suit Proceeds DINASO & SONS: Case Summary & 20 Largest Unsecured Creditors DOLAN COMPANY: Nantahala Wants Unrestricted Shares Transfer DOMNUS CORP: Case Summary & 5 Largest Unsecured Creditors DOTS LLC: Wants Liquidation of Biz Completed Before Plan Filing DOTS LLC: Danice Stores Wants to Acquire Store 455 Lease DOTS LLC: Hearing on IP Assets Sale Set for Tuesday DOTS LLC: Luis Salazar Appointed as Consumer Privacy Ombudsman DUKE FUNDING: Replacement Collater Mgr. No Impact on Fitch Ratings DVORKIN HOLDINGS: Trustee Can Pay Property Management Fees E-REWARDS INC: S&P Assigns 'B' Corp Credit Rating; Outlook Stable EDEN CRYOGENICS: Case Summary & 20 Largest Unsecured Creditors EDGENET INC: Lands $6.5MM Purchase Offer Before June Auction ENERGY FUTURE: Posts $609 Million Net Loss for Q1 2013 ENERGYSOLUTIONS INC: S&P Raises Corp. Credit Rating to 'B+' FENWICK AUTOMOTIVE: Says Parent's Suit Belongs In Canada FIRED UP: Hires Barron & Newburger as Counsel FIRED UP: Hires Hajjar Sutherland as Special Counsel FIRED UP: Names Vernon Law as Special Counsel FIRST QUANTUM: S&P Assigns 'B+' Rating to $650MM Sr. Sec. Notes FIRSTPLUS FINANCIAL: Lucchese Associate Asks For Mistrial FLETCHER INTERNATIONAL: Skadden Arps Settlement Approved FLORENCE MEDICAL: Assets to Be Auctioned Off July 22 FOREST OIL: S&P Puts 'B-' CCR on CreditWatch Positive FREE LANCE-STAR: Credit Bid Barred for Inequitable Conduct FREEDOM INDUSTRIES: Bankruptcy Lawyers, Advisers Bill $1.9MM GASTAR EXPLORATION: S&P Affirms 'B-' Corporate Credit Rating GENERAL MOTORS: Cadillac Test Drivers Warned of Ignition Defects GENERAL MOTORS: Texas Judge Rejects Bid for "Park-It" Order GILES-JORDAN: Section 341(a) Meeting Scheduled for June 2 GOLDEN LAND: Voluntary Chapter 11 Case Summary GREAT PLAINS: Aug. 11 Pre-Trial Conference on Bank's Motion GREAT PLAINS: Has Access to Cash Collateral Until Sept. 30 GREAT PLAINS: Has Until June 8 to Submit Fourth Amended Plan GSE ENVIRONMENTAL: Moody's Lowers PDR to 'D-Pd' Over Bankruptcy GTP ACQUISITION: Fitch Affirms BB- Rating on Class 2011-2F Notes GUISEPPE FILIPPINI: Case Summary & 2 Largest Unsecured Creditors HOME SAVINGS: FDIC Trumps Jackson Walker In Row Over Legal Fees HOYT TRANSPORTATION: NY School Bus Operator Back in Business INDU CRAFT: Untimely Appeal to Circuit Court Isn't Jurisdictional IOWA FINANCE: Fitch Affirms 'BB-' Rating on Revenue Bonds IRI SABINO: Golf Course Name, Assets to Be Sold May 28 ITSA HARDWARE: Foreclosure Auction Set for June 4 JBJAZ LLC: Villages At Queen Creek Lot to Be Sold May 28 JENKINS BROS: Liberty Mutual Can't Duck Asbestos Claims KAWISH LLC: Case Summary & 4 Largest Unsecured Creditors KRATOS DEFENSE: Moody's Assigns B3 CFR & Rates $625MM Notes B3 LEGACY RESERVES: S&P Raises CCR to 'B+' on Acquisition LIVE CELL ASSAYS: Case Summary & 6 Largest Unsecured Creditors LUNDY'S MANAGEMENT: Voluntary Chapter 11 Case Summary LYONDELL CHEMICAL: Lender Can't Sue Over Loan Syndicate Exclusion MARTIFER SOLAR: Plans to Auction Business by Mid-June MARTIN BELZ: Peabody Hotel Chairman Confirms Chapter 11 Plan MEOJ LLC: RepublicBankAz to Conduct Foreclosure Sale May 28 MF GLOBAL: J.C. Flowers Defeats Sapere's Lawsuit MICHIGAN PRODUCE: Case Summary & 20 Largest Unsecured Creditors MO'TREES LLC: Case Summary & 10 Largest Unsecured Creditors MOMENTIVE PERFORMANCE: DIP Lenders Agree to Lower LIBOR Rate MONTE DEI PASCHI: Seeks to Raise EUR5 Billion Cash Call MT. GOX: Founder Won't Appear in U.S. for Questioning MT. GOX: Liquidation "Bad Sign" for US Investors, Experts Say MUNDY RANCH: May 13 Hearing on Adequacy of Plan Outline NAMCO FINANCIAL: Insurers Can Rescind $20MM From Fraudster's Firm NORTEL NETWORKS: Canadian Debtors Directed to Produce Documents OCWEN FINANCIAL: Fitch Rates Senior Unsecured Notes 'CCC/RR6' ORTHO-CLINICAL DIAGNOSTICS: Debt Increase No Impact on Moody's CFR ORTHO-CLINICAL DIAGNOSTICS: S&P Keeps 'B' CCR After Upsized Debt PEABODY ENERGY: Fitch Affirms 'BB' Issuer Default Rating PERSONAL COMMUNICATIONS: Confirms Liquidating Plan PHILLIPS PLASTICS: Moody's Places B1 CFR on Review for Downgrade QUANTUM FOODS: Union Says $54MM Sale Must Respect Contracts RADIOSHACK CORP: Mired in Talks With Lenders Over Closings REGIONAL CARE: May 15 Hearing on Confirmation of Amended Plan RESTORA HEALTHCARE: Panel Hires Morris James as Co-counsel RESTORA HEALTHCARE: Panel Taps CohnReznick as Financial Advisor RIH ACQUISITIONS: Atlantic Club Casino Confirms Liquidating Plan RIVER-BLUFF ENTERPRISES: Court OKs Hiring of Kimel Law as Counsel RIVER-BLUFF ENTERPRISES: Culbertson Jordan Approved as Accountant SABINE OIL: S&P Affirms 'B' CCR on Merger Agreement SARKIS INVESTMENTS: Hires GA Keen as Real Estate Broker SARKIS INVESTMENT: Receiver Hires Frandzel Robins as Counsel SERVICEMASTER CO: S&P Assigns B- CCR & Puts Rating on Watch Pos. SGK VENTURES: Seeks Approval of Hilco as Real Estate Broker SGK VENTURES: Can Access NewKey's Cash Collateral Until Aug. 29 SGK VENTURES: Files Amended Schedules of Assets and Liabilities SHEA HILLS: Vacant Land to Be Auctioned Off May 22 SI ORGANIZATION: S&P Assigns 'CCC+' Rating to $140MM Loan SKYLINE MANOR: Case Summary & 20 Largest Unsecured Creditors SKYLINE RIDGE: Assets to Be Auctioned Off May 28 SPECIALTY PRODUCTS: Proposes Asbestos Claimant Notification Plan STAR DYNAMICS: Judge Denies Womble Carlyle Fees SUNTECH POWER: Solyndra & ECD Trusts Balk at Chapter 15 Petition TRIPLANET PARTNERS: Voluntary Chapter 11 Case Summary VEYANCE TECHNOLOGIES: S&P Retains 'B' CCR on CreditWatch Positive VICTOR TECHNOLOGIES: Moody's Withdraws B2 Corporate Family Rating WP MUSTANG: S&P Assigns 'B' CCR & Rates $495MM 1st Lien Loan 'B' * "Resulting Trust" a Difficult Defense on Fraud Claim * Assets of Secondary Business Exempt as Tools of the Trade * Barnes & Thornburg Nabs Akin Gump Appellate Pro * BofA Settles With FGIC over Second-Lien Mortgage Securities * Carlton Fields Opens LA Office, Adds 2 Ex-Steptoe Attys * Circuit Pulls Back on Fee Denial for Stay Violation * Citigroup Received Mixed Signals On "Stress Test" * Homestead Rights Limited for Non-Bankrupt Spouse * New Bankruptcy Fees to Take Effect June 1 * Rent Rising Out of Reach for U.S. Middle Class * Settlement Prevents New York Apartments' Foreclosure * Sufficient Liquidity Portends No Increase in Defaults * U.S. Regulators Examining Departures at Mortgage Registry * Vexatious Litigant Determined by Objective Standard * BOND PRICING -- For Week From May 5 to 9, 2014 ********* 21ST CENTURY: Moody's Places 'B3' CFR on Review for Upgrade ----------------------------------------------------------- Moody's Investors Service placed 21st Century Oncology, Inc.'s B3 Corporate Family Rating and other existing ratings on review for upgrade. The review is prompted by 21st Century's announced plan to reduce debt with proceeds from its Initial Public Offering ("IPO") of common stock and preferred stock offering (collectively the "equity offering"), as well as refinance and extend the maturity of a portion of its existing debt. The company's speculative grade liquidity rating of SGL-3 will remain unchanged until the transactions close. In a related action, Moody's assigned Ba3 ratings to 21st Century's proposed $210 million senior secured revolving credit facility and $430 million senior secured term loan. The assigned Ba3 ratings on the proposed $210 million senior secured revolving credit facility and $430 million senior secured term loan assumes the IPO and debt refinancing close as planned. Proceeds from equity offering, expected to total $240 million net of fees and expenses, will be used to repay the company's existing $90 million term loan, repay a portion of amounts outstanding on the company's current $100 million revolving credit facility, repay a portion of the OnCure 11.75% senior secured notes, repay the SFRO term loans and other indebtedness, as well as pay related fees and expenses. Proceeds from the proposed $430 million term loan are anticipated to refinance the company's existing $350 million 8.875% 2nd lien notes rated B2, pay fees and expenses, and add cash to the balance sheet. The IPO and refinancing transactions are expected to close in late May 2014. Ratings Rationale Moody's review for upgrade will consider 21st Century's final capital structure post completion of the equity offering and refinancing transaction as well as the amount of proceeds from the sale of shares. Moody's will also evaluate the company's liquidity profile, financial policy, and the reimbursement risk given the company's high reliance on government payors. Should the equity offering and refinancing close as planned, including the application of IPO proceeds to reduce existing debt and reduce the company's interest burden resulting in projected debt to EBITDA near 6.5 times (pro-forma for the OnCure Holdings and South Florida Radiation Oncology acquisitions), Moody's would raise the CFR by one notch to B2 and consider raising the SGL-3 speculative grade liquidity rating to SGL-2. The following rating actions were taken (LGD point estimates are subject to change and all ratings are subject to the execution of the transaction as currently proposed and Moody's review of final documentation): The following ratings were placed on review for upgrade: Corporate Family Rating, B3; Probability of Default Rating, B3-PD; $100 million senior secured revolving credit facility, due October 2016, at Ba3 (LGD1, 7%); $90 million senior secured term loan, due October 2016, at Ba3 (LGD1, 7%); $350 million senior 2nd lien 8.875% notes, due January 2017, at B2 (LGD3, 42%); $380 million senior subordinated 9.875% notes, due April 2017, at Caa2 (LGD5, 83%). The following ratings were assigned: $210 million senior secured revolving credit facility due 2019, at Ba3 (LGD2, 27%); $430 million senior secured term loan due 2021, at Ba3 (LGD2, 27%). 21st Century's outlook was changed to rating under review from stable. The principal methodology used in this rating was the Global Healthcare Service Providers published in December 2011. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. 21st Century Oncology, Inc. ("21st Century"), formerly known as Radiation Therapy Services, Inc. ("RTS") owns and operates integrated cancer care treatment facilities in the US and Latin America. The company's revenue for the last twelve months ended December 31, 2013 was approximately $694 million. 21st Century is majority owned by Vestar Capital and management. 21ST CENTURY: S&P Revises Outlook to Positive & Assigns 'B-' CCR ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on 21st Century Oncology Inc. to positive from stable. At the same time, S&P assigned a 'B-' corporate credit rating to the company's parent, 21st Century Oncology Holdings Inc. The outlook is positive. Subsequently, S&P withdrew the corporate credit rating on 21st Century Oncology Inc. following these actions. Additionally, S&P assigned a 'B-' issue-level rating to the proposed first-lien credit facility. The recovery rating on the facility is '3', which reflects S&P's expectation for meaningful (50% to 70%) recovery in the event of a payment default. The credit facility will consist of a $210 million revolving credit facility due 2019 and a $430 million term loan B due 2021. The company will use the proceeds of the IPO and the proposed credit facilities to pay down the existing revolving credit facility, the existing first-lien term loan, the second-lien notes, and other unrated debt. "We are revising the outlook to positive based on our expectation that the IPO and proposed refinancing will lower interest expense and improve the company's cash flow," said credit analyst Tulip Lim. The outlook is positive reflecting the potential for an upgrade over the near term if the IPO and refinancing are completed as contemplated. Upside scenario S&P could raise the rating over the near-term if revenue and EBITDA grow as S&P expects and it become convinced that the company could generate moderate discretionary cash flow. This would likely entail the smooth integration of OnCure and SFRO, continued volume increase, and future reimbursement rate cuts that are relatively benign such that the company continues to produce mid-single-digit revenue growth and margins continue to expand. Downside scenario S&P would revise the outlook to stable if the IPO and refinancing are not completed in a timely manner. 24/7/365 BANDWIDTH: Public Auction of Assets on Wednesday --------------------------------------------------------- Assets of 24/7/365 Bandwidth, LLC, will be sold at a public auction to the highest bidder at the offices of Ryley Carlock & Applewhite, One North Central Avenue, 12th Floor Lobby, Phoenix, Arizona 85004, in Maricopa County, on May 14, 2014, at 10:00 a.m. The assets include real and personal property located at 4060 West Clarendon, in Phoenix, Arizona 85019. The assets serve as collateral to debt in the original principal balance of $269,000 owed to Washington Federal. The current trustee for the assets is: W. Scott Jenkins, Jr. Ryley Carlock & Applewhite One North Central Avenue, Suite 1200 Phoenix, AZ 85004 Tel: 602-440-4800 The sale will be made for cash, federal funds wire transfer or other form of payment satisfactory to Trustee (payable at the time of sale or as allowed by the Trustee under Arizona law). Every bidder except for Beneficiary will be required to provide a $10,000 deposit in form satisfactory to Trustee as a condition to entering a bid. At Washington Federal's option, the assets may be sold in one or more subsequent sale proceedings. 59TH AVE & PEORIA: Foreclosure Sale Set for June 20 --------------------------------------------------- Real and personal property at 10630 N. 59th Avenue Glendale, Arizona 85304, will be sold at public auction to the highest bidder at the law offices of Gust Rosenfeld P.L.C., in Phoenix, Arizona, on June 20, 2014, at 10:00 a.m. Proceeds of the sale will be used to pay down debt in the original principal balance of $2,900,000 owed to: Peoria 59, LLC 1916 South Gilbert Road, Suite 5 Mesa, AZ 85204 The assets are owned by: 59th Ave & Peoria Investors, LLC 8115 E. Indian Bend Road, Suite 119 Scottsdale, AZ 85250 -- and -- Richkamp, LLC 8115 E. Indian Bend Road, Suite 119 Scottsdale, AZ 85250 The Successor Trustee may be reached at: Christopher M. McNichol Gust Rosenfeld P.L.C. One East Washington Street, Suite 1600 Phoenix, AZ 85004 Telephone: (602) 257-7972 (Attention: Amey Wheeler) 911 NORTH BUFFALO: Case Summary & 3 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: 911 North Buffalo, LLC 1436 S Main Street, Suite 200 Los Angeles, CA 90015 Case No.: 14-13312 Chapter 11 Petition Date: May 9, 2014 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Hon. August B. Landis Debtor's Counsel: Ryan Alexander, Esq. LAW OFFICES OF RYAN ALEXANDER PLLC 200 E. Charleston Blvd Las Vegas, NV 89104 Tel: (702) 222-3476 Fax: (702) 252-3476 Email: ryan@thefirm-lv.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Hamid Mahban, manager. A list of the Debtor's three largest unsecured creditors is available for free at http://bankrupt.com/misc/nvb14-13312.pdf ABOUND SOLAR: Internal Report Slams U.S. Handling of Guarantees --------------------------------------------------------------- Valerie Volcovici, writing for Reuters, reported that the U.S. Department of Energy displayed a "lack of guidance" in how it dealt with millions of dollars in loan guarantees to now-bankrupt Abound Solar Manufacturing, the agency's internal watchdog said in a report. According to the report, the DOE in recent years has tried to help commercialize the production of solar equipment such as panels and photovoltaic modules with a series of loan guarantees. The program was savaged by Republican lawmakers after the high-profile bankruptcy of California-based solar manufacturer Solyndra in 2011, the report related. The latest audit of loan guarantees to Abound could re-open those wounds. In a 32-page report, the DOE's Inspector General reviewed the case of Colorado-based Abound, which filed for bankruptcy protection in June 2012 and laid off more than 100 employees, after receiving about $70 million of a $400 million loan guaranteed by the government, the report further related. Although the DOE said it had identified and taken steps to mitigate risks, and suspended funding when the company failed to meet certain milestones, the IG report said the loan guarantee program had not established "comprehensive policies, procedures and guidance for awarding, monitoring and administering loans," the report said. About Abound Solar Abound Solar Inc. filed for Chapter 7 bankruptcy liquidation (Bankr. D. Del. Case No. 12-11972) on July 2, 2012. The company disclosed assets of $136.1 million and debt totaling $82 million. Abound Solar was awarded a $400 million loan guarantee from the U.S. Department of Energy in July 2010 to build a facility in Indiana and expand its Longmont facility. Abound borrowed about $70 million from the DOE loan guarantee. Abound halted production in February from the one plant in Colorado. A second was planned in Indiana. Abound Solar joined fellow panel makers Solyndra LLC and Evergreen Solar Inc. in the Delaware bankruptcy court. Adam Singer serves as bankruptcy trustee. ALLENS INC: PACA Can't Be Stretched Far Enough to Help Farmer ------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Allens Inc., a liquidated processor of canned vegetables, gave U.S. Bankruptcy Judge Ben Barry an opportunity to opine on what constitutes substantial compliance with notice requirements contained in the Perishable Agricultural Commodities Act. According to the report, in substance, a timely Paca claim gives a farmer or distributor the status of a secured creditor who must be paid ahead of everyone else. The statute creates a legal fiction that proceeds from agricultural products don't belong to the bankrupt company until all Paca claims are fully paid, the report related. In the Allens case, a sweet potato farmer didn't submit notice of a Paca claim within the 40 days allowed by statute after delivery of the goods, the report further related. In his opinion on April 14, Judge Barry agreed with the farmer that the proof of claim sufficed for the required Paca notice, the report said. The claim, however, came more than 40 days after delivery. About Allens Inc. Siloam Springs, Arkansas-based Allens, Inc., a maker of canned and frozen vegetables in business since 1926, filed for bankruptcy (Bankr. W.D. Ark. Case No. 13-73597) on Oct. 28, 2013, seeking to sell some divisions or reorganize as a new company. Its affiliate, All Veg Inc., also sought bankruptcy protection. Bankruptcy Judge Ben T. Barry presides over the cases. The Debtors are represented by Stan D. Smith, Esq., Lance R. Miller, Esq., and Chris A. McNulty, Esq., at Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C., in Little Rock, Arkansas; and Nancy A. Mitchell, Esq., Maria J. DiConza, Esq., and Matthew L. Hinker, Esq., at Greenberg Traurig, LLP, in New York. Jonathan Hickman of Alvarez & Marsal North America, LLC, serves as the Debtors' chief restructuring officer. Cary Daniel, Nick Campbell and Markus Lahrkamp of A&M serve as assistant CROs. Lazard Freres & Co. LLC and Lazard Middle Market LLC serve as investment bankers, while GA Keen Realty Advisors, LLC, serves as real estate advisor to the Debtors. Allens Inc. scheduled $294,465,233 in total assets and $287,945,167 in total liabilities. The Official Committee of Unsecured Creditors tapped Eichenbaum Liles P.A.'s Martha Jett McAlister, Esq.; and Cooley LLP's Cathy Hershcopf, Esq., Jeffrey L. Cohen, Esq., Seth Van Aalton, Esq., and Robert B. Winning, Esq., as counsel. On Feb. 12, 2014, the Court entered the order (i) authorizing and approving the sale of substantially all of the assets of the Allens Inc. to Sager Creek Acquisition Corp. -- which is owned by investment funds controlled or advised by Sankaty Advisors LLC and GB Credit Partners LLC -- free and clear of all liens, claims, encumbrances, and interests; and (ii) approving the assumption and assignment of certain of the Debtor's executory contracts and unexpired leases. The sale closed Feb. 28. The Associated Press said the assets will be sold to Sager Creek for $124.78 million. Katy Stech, writing for Daily Bankruptcy Review, the investment vehicle won the bidding with a $160 million offer, topping stalking horse bidder Seneca Foods Corp. at a bankruptcy auction. Seneca Foods signed an agreement to purchase the Debtors' assets for $148 million plus assumption of specified debt. Counsel to the stalking horse purchaser is Tim C. Loftis, Esq., at Jaeckle, Fleishmann & Mugel, LLP, in Buffalo, New York. Local counsel to the stalking horse purchaser is Charles T. Coleman, Esq., at Wright, Lindsey & Jennings, LLP, in Little Rock, Arkansas. ALTEGRITY INC: S&P Lowers CCR to 'CC'; Outlook Negative ------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Falls Church, Va.-based Altegrity Inc. to 'CC' from 'CCC-'. The outlook is negative. At the same time, S&P lowered the senior secured debt rating to 'CCC-' from 'CCC'. The recovery rating on the senior secured debt is '2', indicating that lenders could expect substantial (70% to 90%) recovery in the event of a payment default. In addition, the senior unsecured and subordinated debt ratings have been affirmed at 'C' (which is the lowest possible issue rating for an instrument that is not in default). The recovery rating on this debt is '6', indicating that lenders could expect negligible (0% to 10%) recovery in the event of a payment default. The rating actions follows Altegrity's announcement that it is in discussion with various stakeholders to effect a comprehensive recapitalization in advance of large debt maturities that total around $1 billion through February 2015 and $1.8 billion through May 2016. If completed, the transaction would, among other things, extend maturities; exchange existing unsecured and senior subordinated debt into second- and third lien-debt; and provide modest cash pay downs and increased paid-in-kind (PIK) interest to existing senior unsecured debt. "The offer, in our view, implies the investors will receive less value than the promise of the original securities," said Standard & Poor's credit analyst Jerry Phelan. "In addition, the company is requesting a temporary waiver on the secured net debt ratio covenant through July 15, 2014, which we understand is being requested to prevent a covenant default and therefore provide time to complete the recapitalization." Standard & Poor's rating outlook is negative. S&P intends to lower the corporate credit rating to 'SD' and the affected issue- level ratings to 'D' assuming the distressed exchange is completed. S&P expects that it will raise its ratings shortly thereafter, after it completes a forward-looking review that takes into account the combined company's business risk and financial risk profiles, including any benefits from the proposed debt exchange. AMERISERV FINANCIAL: Fitch to Withdraw 'bb' Viability Rating ------------------------------------------------------------ Fitch Ratings plans to withdraw the ratings on Ameriserv Financial, Inc. and Ameriserv Financial Bank on or about June 7, 2014, for business reasons. Fitch currently rates the two entities as follows: Ameriserv Financial, Inc. -- Long-Term Issuer Default Rating (IDR) 'BB'; -- Short-Term IDR 'B'; -- Viability rating 'bb'; -- Support Rating '5'; -- Support floor 'NF'. Ameriserv Financial Bank -- Long-Term IDR 'BB'; -- Long-Term Deposits 'BB+'; -- Short-Term IDR 'B'; -- Short-Term Deposits 'B'; -- Viability rating 'bb'; -- Support Rating '5'; -- Support floor 'NF'. Ameriserv Capital Trust I -- Preferred 'B-'. Fitch reserves the right in its sole discretion to withdraw or maintain any rating at any time for any reason it deems sufficient. Fitch believes that investors benefit from increased rating coverage by Fitch and is providing approximately 30 days' notice to the market on the withdrawal of Ameriserv Financial, Inc. and Ameriserv Financial Bank ratings as a courtesy to investors. Fitch's last rating action took place on Sept. 23, 2013, at which time Fitch affirmed its long-term ratings on Ameriserv Financial, Inc.at 'BB'. ANCHOR GLASS: S&P Assigns 'B+' Corp. Credit Rating -------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' corporate credit rating to Tampa, Fla.-based Anchor Glass Container Corp. The outlook is stable. At the same time, based on preliminary terms and conditions, S&P assigned a 'BB-' issue rating to Anchor Glass' proposed $335 million first-lien term loan maturing in 2021. The recovery rating on this debt is '2', indicating S&P's expectation for substantial (70% to 90%) recovery in the event of a payment default. The credit facility also includes a proposed $100 million asset-based revolving credit facility (unrated). In April 2014, KPS Capital Partners L.P. entered into definitive agreements to acquire Anchor for $438 million from Ardagh Holdings US Inc., and the transaction is expected to close in the second quarter of 2014, subject to customary closing conditions and regulatory approvals. Proceeds from the first-lien term loan along with approximately $140 million of cash common equity will be used to finance the transaction, pay transaction-related fees and expenses, and fund some cash to the balance sheet. S&P's 'B+' rating on Anchor Glass Container Corp. has been derived from its anchor of 'b', based on its assessments of a "fair" business risk and "highly leveraged" financial risk profile for the company. S&P has adjusted its initial rating outcome upward by one notch using a comparative ratings analysis. Based on S&P's base-case expectations, it believes Anchor Glass' credit measures will be stronger than those of other companies we deem as having highly leveraged financial risk profiles. All other modifiers are neutral for the rating. "The 'fair' business risk profile reflects the company's position as the third-largest glass packaging manufacturer in the U.S., its high customer and end-market concentration, substitution risk arising from periodic conversions from glass to plastic containers, greater visibility of future revenue streams through renewed multiyear contracts, and favorable cost pass-through mechanisms," said Standard & Poor's credit analyst Liley Mehta. The stable outlook reflects S&P's expectation for fairly predictable business conditions and stable cash flow generation over the next few years. S&P incorporates moderate acquisitions or a potential dividend distribution that could take Anchor Glass' total debt to EBITDA to about 5x in the near term. S&P expects this level to provide sufficient cash flow to meet internal needs and maintain normal business operations. S&P could lower the ratings if the company makes a large debt- financed acquisition, and operating performance deteriorates, that would cause total debt to EBITDA to reach 6x to 6.5x. Also, S&P could lower ratings if company generates negative free cash and its liquidity position deteriorates. Operational challenges could occur following unexpected volume declines owing to a squeeze in consumer spending or falling demand for mass beer brands, more-aggressive substitution of plastic containers for glass in certain beverage and food categories, or a significant decline in business from a key customer. Based on the downside scenario we forecast, if the company made a debt-financed dividend distribution, and operating margins weaken by more than 3%, or if volumes decline 10% or more from current levels, S&P expects credit metrics to weaken such that total adjusted debt to EBITDA deteriorates to 6x. Given the company's private-equity ownership, and limited track record of ownership by its financial sponsor, S&P views an upgrade over the next year as unlikely. S&P could raise the ratings if the company demonstrates a track record and commitment to maintaining its financial profile at levels indicative of an "aggressive" financial risk profile. ANTIOCH COMPANY: Former Execs Lose Bonus Protection Bid ------------------------------------------------------- Law360 reported that an Ohio federal judge refused to block an attempted clawback of bonuses earned by three former executives of bankrupt Antioch Co., finding there to be a disputed issue of fact as to whether the company was insolvent when the bonuses were awarded. According to the report, U.S. District Judge Timothy S. Black said while a review of the balance sheet of Antioch, the parent of scrapbooking company Creative Memories, indicates Antioch was indeed insolvent when the bonuses were issued, but investment manager Prairie Capital, which had been retained to evaluate Antioch's worth, maintains the company had a fair market value of $10 million. As such, the judge denied three separate motions for summary judgment on the five-figure bonuses from former Treasurer Steve Bevelhymer, former Chief Financial Officer Karen Felix and former Compliance Director Kimberly Lipson-Wilson, the report related. However, Judge Black did dismiss a breach of fiduciary duty claims against the trio, finding the trustee for Antioch failed to produce clear and convincing evidence to support this claim. The trustee has sued the executives along with several other defendants, accusing them of profiting off of the decline of the company, the report further related. The case is the Antioch Co. Litigation Trust v. Lee Morgan et al., case number 3:10-cv-00156 in the U.S. District Court for the Southern District of Ohio. About The Antioch Company St. Cloud, Minn.-based scrapbook company The Antioch Company and six affiliates filed for Chapter 11 bankruptcy (Bankr. D. Minn. Case No. 13-41898) in Minneapolis on April 16, 2013. Antioch disclosed $10 million to $50 million in both assets and debts. The affiliates that separate filed for Chapter 11 are Antioch International-Canada LLC, Antioch International LLC, zeBlooms LLC, Antioch Framers Supply LLC, Antioch International-New Zealand LLC, and Creative Memories Puerto Rico, LLC. Founded in 1926, Antioch and its affiliates make up one of the world's preeminent suppliers of scrapbooks, related accessories, and photo solutions for memory preservation through the direct sales channel. The Debtors also go by business names Creative Memories, Antioch, Agenda, Antioch Publishing, Cottage Arts, Frame of Mind and Webway. Antioch has 200 employees and currently has operations through the Debtor companies and foreign subsidiaries in the United States, Canada, Japan, Australia, and New Zealand. In 2012, the Company's net revenue was approximately $93.8 million and it had a net loss of $3.7 million. Antioch previously sought bankruptcy protection in 2008 (Bankr. S.D. Ohio Case No. 08-35741). In the 2013 case, the U.S. Trustee appointed a seven-member creditors committee. Faegre Baker Daniels LLP serves as its counsel. Crowe Horwath LLP serves as its financial advisor. The Antioch Company, et al., and the Official Committee of Unsecured Creditors, obtained confirmation on Nov. 14, 2013, their Second Amended Joint Plan of Reorganization dated Nov. 13, 2013. ARCH COAL: Fitch Cuts Issuer Default Rating to 'CCC' ---------------------------------------------------- Fitch Ratings downgraded the Issuer Default Rating (IDR) to 'CCC' from 'B-' for Arch Coal, Inc. (Arch Coal; NYSE: ACI). A complete list of rating actions follows at the end of this release. The downgrade results from Fitch's view that earnings will remain weak and cash flow will be burned through 2015 given the outlook for metallurgical coal prices. Based on preliminary March 31, 2014 figures, total debt was $5.1 billion and LTM EBITDA was $243 million. Ratings Drivers: Arch Coal benefits from large, well-diversified operations and good control of low-cost production. Globally, Arch is the sixth largest coal producer based on volumes. The company sold 140 million tons of coal in 2013. Between 87% and 92% of 2014 expected volumes are committed and priced. Assuming no change in sales volume for 2015, between 48% and 51% of tons are committed and priced. The company has the third largest coal reserve position in the U.S. at 3.9 billion tons. Steam coal demand in the U.S. is recovering, supply has been disciplined, stocks are falling and prices are improving going forward. Globally, both metallurgical (met) and steam coal are in excess supply and prices are weak. Coal producers have been running for cash with a focus on reducing costs which is expected to delay price recovery. In particular, Fitch believes the hard coking coal bench mark price could average about $135/tonne (t) and the Newcastle steam coal benchmark could be below $85/t over the next 12 months. The industry is consolidating which should benefit supply/demand dynamics longer term. Liquidity At March 31, 2014, cash on hand was $866 million, short-term investments were $245 million, and Fitch estimates that $250 million was available under the company's credit facilities. The $250 million accounts receivable facility matures Dec. 10, 2014, and is renewable annually. The $250 million credit facility matures in June 2016. Revolver covenants include a maximum net senior secured leverage ratio of 5:1 from June 30, 2015 with step- downs thereafter and a minimum liquidity of $550 million through Dec. 30, 2015. Fitch expects Arch Coal to comply with its covenants. Current maturities are quite modest at $33.5 million in 2014, $24 million in 2015, $24 million in 2016, $24 million in 2017 and $1.9 billion in 2018. Cash burn is expected to continue at consensus met coal price expectations. Interest expense is running at $382 million per year, 2014 capital expenditure guidance tops out at $190 million, and dividends are $2 million per annum. Capital expenditures are down on the completion of the Leer mine and the sale of Canyon Fuel, both in 2013. Fitch believes 2014 free cash flow burn after capital expenditures and dividends could be as much as $320 million. Capital Structure Arch's actions to preserve liquidity since 2012 coupled with two years of losses have resulted in a debt/capital ratio at 70%. Fitch expects earnings to be weak in 2014 and leverage to remain elevated through at least 2016. Recovery Fitch believes the senior secured bank facilities and second lien notes have excellent recovery prospects in a default scenario while the senior unsecured notes have below average recovery prospects. Ratings Sensitivities Negative: Future developments that may, individually or collectively, lead to negative rating action include: -- Liquidity falling below $1 billion; -- Expectations that 2016 EBITDA will be $600 million or less. Positive: Not anticipated over the next 12 months given industry conditions but future developments that may lead to a positive rating action include: -- Debt levels materially reduced and free cash flow generation is expected to be positive on average. Fitch has downgraded the following ratings: -- IDR downgraded to 'CCC' from 'B-'; -- Senior secured revolving credit facility downgraded to 'B/RR1' from 'BB-/RR1'; -- Senior secured term loan downgraded to 'B/RR1' from 'BB-/RR1'; -- Second lien secured notes downgraded to 'B-/RR2' from 'B+/RR2'; -- Senior unsecured notes downgraded to 'CCC-/RR5' from 'CCC+/RR5'. ASCEND LEARNING: Moody's Rates New $125MM 2nd Lien Debt 'Caa2' -------------------------------------------------------------- Moody's Investors Service assigned a Caa2 rating to Ascend Learning, LLC's proposed $125 million second lien term loan. Concurrently, Moody's affirmed the company's B3 corporate family rating, upgraded the probability of default rating to B3-PD from Caa1-PD, and upgraded the company's first lien credit facilities to B2 from B3. The ratings outlook has been changed to negative from stable. Proceeds from the proposed second lien term loan will fund a $118 million dividend to the company's sponsor, Providence Equity Partners, as well as pay related fees and expenses. The change in outlook to negative from stable reflects the elevated financial risk profile and aggressive financial policy that will result in an erosion of the company's financial flexibility. The debt financed dividend will increase leverage to over 7 times, a level viewed as high for the B3 rating category. The following rating actions were taken (LGD point estimates are subject to change and all ratings are subject to the execution of the transaction as currently proposed and Moody's review of final documentation): Corporate family rating affirmed at B3; Probability of default rating upgraded to B3-PD from Caa1-PD; $125 million second lien term loan, assigned Caa2 (LGD5, 89%); $40 million senior secured revolving credit facility due 2019, upgraded to B2 (LGD3, 37%) from B3 (LGD3, 33%); $408 million senior secured term loan due 2019, upgraded to B2 (LGD3, 37%) from B3 (LGD3, 33%); Outlook changed to negative from stable. Ratings Rationale Ascend's B3 corporate family rating reflects its high financial leverage, weakened interest coverage, and high capital spending requirements that constrain free cash flow generation. The rating also captures the company's relatively small scale, persistently high funded debt levels which remain well in excess of revenue, and track record of aggressive financial policies given its history of dividends and acquisitions. Ascend's high leverage reduces its financial flexibility as well as ability to withstand changes to the competitive environment. Notwithstanding these concerns, the rating predominantly derives support by the company's demonstrated ability to strengthen operating performance, good liquidity profile and cash flow generation trends. The rating favorably considers Ascend's primary focus on providing learning solutions for healthcare related fields, which are projected to experience higher than average employment growth over the next few years. The rating is also supported by the company's established position within its niche verticals, good operating margins, the subscription like-nature of its revenue, and the diversity of its customer base. The negative outlook reflects Moody's view that while the company's recent operating performance, cash flow, and liquidity are improved, the increase in debt to fund a dividend and the resultant high leverage level limits the company's financial flexibility. Moody's could downgrade the ratings if debt to EBITDA remains over 7.0 times or if the company's liquidity situation deteriorates, demonstrated by reduced cushion under financial covenants, depleting cash balances or operating cash flow declines. Ratings could also be downgraded should the company engage in additional shareholder enhancement initiatives such as dividends. While a ratings upgrade is unlikely in the near-term, Moody's could stabilize the outlook if the company demonstrates continued top line growth, consistent positive free cash flow and maintains a conservative financial policy with regards to shareholder enhancement initiatives. Quantitatively, the outlook could be stabilized if debt to EBITDA (Moody's adjusted) improves towards 6.0 times through a combination of earnings growth and debt reduction with continued strong positive free cash flow. The ratings could be upgraded if debt to EBITDA (Moody's adjusted) sustainably approaches 5.0 times through a combination of earnings growth and debt reduction, EBITDA less capital expenditures to interest exceeds 1.75 times, and free cash flow is in the high single-digit range as a percentage of debt. 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. Headquartered in Burlington, Massachusetts, Ascend Learning, LLC provides technology-based learning solutions and educational content for healthcare and other vocational fields. Revenue for the last twelve month period ended 12/31/2013 was approximately $276 million. ASCEND LEARNING: S&P Assigns 'CCC+' Rating to 2nd Lien Loan ----------------------------------------------------------- Standard & Poor's Ratings Services said that it is assigning Burlington, Mass.-based Ascend Learning LLC's second-lien term loan an issue rating of 'CCC+' with a recovery rating of '6', indicating its expectation of negligible (0% to 10%) recovery for lenders in the event of a payment default. "We are affirming our 'B' corporate credit rating on the company. At the same time, we affirmed our 'B' issue-level rating (at the same level as the corporate credit rating) on the company's $448 million credit facility. The recovery rating on this debt remains '3', indicating our expectation of meaningful (50% to 70%) recovery for lenders in the event of a payment default. The facility consists of a $408 million term loan due 2019 and a $40 mllion revolving credit facility due 2019". "The 'B' corporate credit rating on Ascend Learning reflects our assessment of the business risk profile as 'weak' and the financial risk profile as 'highly leveraged'," said Standard & Poor's credit analyst Hal Diamond. Ascend Learning has "adequate" sources of liquidity (as defined in S&P's criteria) to cover its needs over the next 12 months, in its view. The stable rating outlook reflects S&P's expectation that employment growth trends in the health care industry will likely lead to continued good organic revenue growth for the company. Still, S&P anticipates that leverage will remain relatively high (above 6x), reflecting the company's extremely aggressive financial policies. S&P could lower the rating if clear indications emerge that debt leverage will remain above 7.5x, discretionary cash flow will approach breakeven, or the cushion of covenant compliance will fall below 10%. This could result from another special dividend, underperformance of high-priced acquisitions, and/or weaker operating performance. Although highly unlikely, S&P could consider raising the rating over the intermediate term if it concludes that the company has shifted financial policy such that it will reduce and maintain lease-adjusted leverage below 5x, while generating meaningful discretionary cash flow. ATLS ACQUISITION: Medco Wants Contract Decision by May 30 --------------------------------------------------------- The Bankruptcy Court will convene a hearing on May 28, 2014, at 9:30 a.m., to consider creditor Medco Health Solutions, Inc.'s motion to compel ATLS Acquisition, LLC, et al., to assume or reject certain executory contracts with Medco by May 30, 2014. Objections, if any, are due May 20, at 4:00 p.m. Medco said it is among the largest creditors and most significant parties-in-interest in the Debtors' cases. On Dec. 3, 2012, FGST (one of the Debtors) acquired Medco's equity ownership of the Debtors in the so-called MBO Transaction, pursuant to a purchase agreement. According to Medco, with the Debtors' litigations against Medco (including the adversary complaint, claims objection, and Debtors' summary judgment motions), the Debtors seek inequitably to force Medco's performance under the purchase agreement and other related agreements and to take their benefits for the Debtors' estates -- to require Medco to make, if the Debtors were to prevail, payments totaling at least tens of millions of dollars -- even while the Debtors simultaneously (i) seek to avoid and reject their own performance obligations under the purchase agreement and other agreements, (ii) seek disallowance of Medco's legitimate claims under the purchase agreement and other agreements, and (iii) have not assumed or rejected the purchase agreement and the other agreements between the parties. About Liberty Medical Entities that own diabetics supply provider Liberty Medical led by ATLS Acquisition, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-10262) on Feb. 15, 2013, just less than three months after a management buy-out and amid a notice by the lender who financed the transaction that it's exercising an option to acquire the business. Liberty has been in business for 22 years serving the needs of both type 1 and type 2 diabetic patients. Liberty is a mail order provider of diabetes testing supplies. In addition to diabetes testing supplies, the Debtors also sell insulin pumps and insulin pump supplies, ostomy, catheter and CPAP supplies and operate a large mail order pharmacy. Liberty operates in seven different locations and has 1,684 employees. Dennis A. Meloro, Esq., at Greenberg Traurig, LLP, serves as the Debtor's counsel; Ernst & Young LLP to provide investment banking advice; and Epiq Bankruptcy Solutions, LLC, as claims and noticing agent for the Clerk of the Bankruptcy Court. An official committee of unsecured creditors has been appointed in the case and consists of LifeScan, Inc., Abbott Laboratories, and Teva Pharmaceuticals USA, Inc. They are represented by Joseph H. Huston Jr., Esq., Maria Aprile Sawczuk, Esq., and Camille C. Bent, Esq., of Stevens & Lee P.C. as well as Bruce Buechler, Esq., S. Jason Teele, Esq., and Nicole Stefanelli, Esq. of Lowenstein Sandler LLP. The Committee has tapped Mesirow Financial Consulting, LLC, as financial advisors. AUC CAMELBACK: RepublicBankAz to Conduct Foreclosure Sale May 30 ---------------------------------------------------------------- Real and personal property of AUC Camelback Investments, LLC, will be sold at public auction to the highest bidder at the offices of Kutak Rock LLP, in Scottsdale, Arizona, on May 30, 2014, at 11:00 a.m. The assets consist of Units 118 and 119, Building 5 at the Camelback 101 Professional Plaza, a condominium, as well as related personal property and fixtures. The assets are located at 9515 West Camelback Road, Building 5, Units 118 & 119, Phoenix, Arizona 85037. Proceeds of the sale will be used to pay down debt in the original principal balance $610,000 owed to: RepublicBankAz, N.A. 909 E. Missouri Ave. Phoenix, AZ 85014 AUC Camelback Investments is based at 5410 West Thunderbird Road, Suite #101, Glendale, Arizona 85306 The Current Trustee may be reached at: Allison H. Swenson, Esq. KUTAK ROCK LLP 8601 N. Scottsdale Road, Suite 300 Scottsdale, AZ 85253 Tel: 480-429-5000 AUTHENTIC BRANDS: Moody's Assigns 'B2' Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service assigned a B2 Corporate Family Rating to ABG Intermediate Holdings 2 LLC ("Authentic Brands"), a B1 rating to the company's proposed $365 million first lien credit facilities, and a Caa1 rating to the proposed $130 million second lien term loan. Ratings are subject to receipt and review of final documentation. This is a first time rating for Authentic Brands. Proceeds from the proposed refinancing transaction are expected to be utilized to refinance the company's existing debt and fund a return of capital to the company's shareholders, in particular its majority owner, Leonard Green & Partners, L.P. Ratings Assigned: ABG Intermediate Holdings 2 LLC Corporate Family Rating at B2 Probability of Default Rating at B2-PD $30 million 1st Lien Revolving Credit Facility at B1/LGD3-33% $335 million 1st Lien Term Loan at B1/LGD3-33% $130 million 2nd Lien Term Loan at Caa1/LGD5-85% The B2 Corporate Family Rating is constrained by high pro forma leverage above 6.0 times debt/EBITDA, integration risks associated with a number of sizable acquisitions consummated in the past year, and meaningful brand and customer concentrations. The rating also considers the company's financial sponsor ownership, and the likelihood that financial policies could result in sustained elevated leverage. The B2 Corporate Family Rating is supported by Authentic Brands' relatively stable and predictable revenue and cash flow streams from royalty payments received by the company, which include significant guaranteed minimum amounts. Its licensor business model is largely asset light, with low fixed overhead costs which drive strong operating margins and interest coverage metrics that are particularly strong for the rating category. The stable outlook incorporates an expectation for modest deleveraging over the next year as the company anniversaries recent sizable acquisitions. Ratings could be downgraded if the company were to experience non- renewal, or renewals at material lower revenue streams for its licenses, or if the company were to become more aggressive in its financial policies. Quantitatively, ratings could be downgraded if leverage were to exceed 6.5 times or if interest coverage were to deteriorate below 2.25 times. In view of the company's small scale, meaningful brand and customer concentrations, and an expectation that cash flow will likely support acquisition activity or otherwise be returned to ownership, a ratings upgrade is unlikely. A ratings upgrade would require an expectation for debt/EBITDA sustained below 5 times. The principal methodology used in this rating was the Global Apparel Companies published in May 2013. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in New York, NY, Authentic Brands is a brand management company with a portfolio that includes Juicy Couture and Hickey-Freeman. AUTHENTIC BRANDS: S&P Assigns 'B' CCR & Rates $365MM Debt 'B+' -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Authentic Brands Group LLC (ABG). The outlook is stable. At the same time, S&P assigned its 'B+' issue rating (one notch above the corporate credit rating) to the company's $365 million first-lien term facility (composed of a $30 million revolver and $335 million first lien term debt), with a recovery rating of '2', indicating that lenders could expect substantial (70% to 90%) recovery in the event of a payment default or bankruptcy. S&P also assigned its 'CCC+' issue rating (two notches below the corporate credit rating) to the company's $130 million second-lien facility, with a recovery rating of '6', indicating that lenders could expect negligible (0% to 10%) recovery in the event of a payment default or bankruptcy. ABG Intermediate Holdings 2 LLC is the issuer of the revolver and the first- and second-lien term loans. "Our ratings on ABG reflect our view that the company's financial profile is "highly leveraged" given the company's heavy debt structure and our estimates of pro forma leverage in the mid-6x area at the close of the proposed transaction. The ratings also reflect our assessment that ABG has a "weak" business risk profile, reflecting its relatively small size, brand concentration, and participation in the highly competitive apparel industry that is susceptible to fashion risk. The company's portfolio of brands is growing and, overall, enjoys good brand recognition. The portfolio includes both apparel and celebrity brands, such as Juicy Couture, Spyder, Elvis Presley, and Marilyn Monroe," S&P noted. "We believe ABG will continue to benefit from its sizable acquisitions in 2013 and stable contracted business, and for gradual improvement in credit metrics through some debt reduction over the next year," said Standard & Poor's credit analyst Jacqueline Hui. "Still, we expect leverage to remain high at above 5x because of the company's significant debt burden. We also expect the company to maintain adequate liquidity." AUTO ORANGE: Creditors Appeal Order Dismissing Ch.11 Case --------------------------------------------------------- Creditors El Camino Real Estate Holdings LLC and 1700 N. El Camino Real Estate LLC have taken an appeal from the Bankruptcy Court's: (i) dismissing the Chapter 11 case of Auto Orange II, LLC, and (ii) judgment for the U.S. Trustee in the amount of $975. On April 21, 2014, the Bankruptcy Court dismissed the Debtor's case, and ordered that the Trustee will have a judgment in the amount of $975 for unpaid quarterly fees. The Bankruptcy Court also determined as moot the Debtor's motion requesting an extension of its exclusive period to file a plan. The Debtor on March 26 requested that the Court dismiss its Chapter 11 case. Marc J. Spizzirri, ECREH, and 1700 had challenged the Debtor's Dismissal Motion. They asked the Court to deny the Dismissal Motion as well as a separate request by the Debtor to extend the exclusivity periods. The creditors assert that the Debtor has failed to demonstrate cause for dismissal or for increasing the exclusivity periods. Moreover, they argued, the Debtor's estate and its creditors are best served by the case proceeding and by the exclusivity periods lapsing so that the creditors may proceed with their plan, which will provide for payment in full of the creditors' claims. They also argued that it would not be in the best interest of the Debtor and any legitimate creditor to have parties who have engaged in fraud to essentially steal the company and its asset. The Debtor, in its response, stated that in spite of the fact that the creditors of the Debtor other than Spizzirri, ECREH and 1700 will receive payment in full on their claims under the plan, those creditors' interests are better served by allowing the Debtor to dismiss its bankruptcy case and forcing the creditors to gamble on the Debtor's success in a state court litigation. Spizzirri et al., also filed a supplemental response to the Debtor's omnibus reply to their opposition to the Dismissal Motion to address the Debtor's inaccurate reply to the opposition. The creditors assert that the Debtor's response was inaccurate and false as reflected in the sworn statement of John Cappelletti filed in support of the reply. As reported in the Troubled Company Reporter on Feb. 24, 2014, the U.S. Trustee also sought dismissal or conversion of the Debtor's case. The U.S. Trustee also asked the Court to fix any quarterly fees due and payable to the U.S. Trustee. The U.S. Trustee said the Debtor has failed to file a monthly operating report for the month of December 2013, and failed to pay U.S. Trustee quarterly fees for the Fourth Quarter of 2013 in the amount of $650. On March 19, the Debtor notified the U.S. Trustee that it does not oppose the dismissal of the case. The TCR also reported that TerraCotta Realty Fund, LLC, notified the Bankruptcy Court that it has withdrawn its own motion to dismiss the case. According to TerraCotta, on Feb. 7, 2014, its was granted relief from automatic stay against the Debtor's real property located at 32881 Camino Capistrano, San Juan Capistrano, California. Mr. Spizzirri is represented by: Michael J. Weiland, Esq. Lei Lei Wang Ekvall, Esq. WEILAND, GOLDEN, SMILEY, WANG EKVALL & STROK, LLP 650 Town Center Drive, Suite 950 Costa Mesa, CA 92626 Tel: (714) 966-1000 Fax: (714) 966-1002 ECREH and 1700 are represented by: Michael J. Weiland, Esq. WEILAND, GOLDEN, SMILEY, WANG EKVALL & STROK, LLP 650 Town Center Drive, Suite 950 Costa Mesa, CA 92626 Tel: (714) 966-1000 Fax: (714) 966-1002 About Auto Orange II Auto Orange II, LLC, filed a bare-bones Chapter 11 petition (Bankr. C.D. Cal. Case No. 13-19490) in Santa Ana, California, on Nov. 21, 2013. The Debtor disclosed $12,700,000 in assets and $10,098,621 in liabilities as of the Chapter 11 filing. The Debtor is represented by James D. Zhou, Esq., at the Law Offices of Zhou and Chini, in Irvine, California. The petition was signed by Barry Baptiste, president of the company. Judge Catherine E. Bauer presides over the case. AVS SUPPLY: Real Property Auction Today --------------------------------------- Real property of AVS Supply, Inc. will be sold to the highest bidder at an auction Monday morning, May 12, 2014, at 11:00 a.m. The auction will be held at Poli & Ball, PLC at 2999 North 44th Street, Suite 500, Phoenix, Arizona 85018. The real property is located at 6721 North Black Canyon Hwy, Phoenix, Arizona 85015. The assets serve as collateral to debt in the original principal balance of $130,000 owed to Wells Fargo Bank, National Association. Wells Fargo may be reached at: Wells Fargo Bank, National Association 3033 Elder Street, MAC#U1851-015 Boise, ID 83705 Attention: Collateral Department -- and -- Wells Fargo Bank, N.A. 100 West Washington Street, 5th Floor MAC S4101-051 Phoenix, AX 85003 Attention: Paula Whipple Name The Trustee for the assets may be reached at: James B. Ball Poli & Ball, PLC 2999 North 44th Street, Suite 500 Phoenix, AZ 85018 Tel: 602/840-1400 BERNARD L. MADOFF: Ex-Aides Seek Acquittal After Guilty Verdict --------------------------------------------------------------- Law360 reported that former Bernie Madoff associates, whom a jury found guilty of aiding the $65 billion Ponzi scheme, asked a New York federal court to acquit them, saying there wasn't enough evidence to show criminal knowledge or intent to participate in any crime. According to the report, the five former Bernard L. Madoff Investment Securities LLC employees -- computer programmers Jerome O'Hara and George Perez, Operations Chief Daniel Bonventre and account managers JoAnn Crupi and Annette Bongiorno -- were convicted late last month on charges including securities fraud and falsifying records. An 11-member jury found them guilty on each of the government's 31 charges after deliberating for less than four full days, the report related. The defendants are scheduled to be sentenced in July and could go to prison for as many as 78 to 220 years each. O'Hara's attorneys argued that when he and Perez became uncomfortable with the work they were doing on software programs Madoff's former Finance Chief Frank DiPascali used to carry out the fraud, they deactivated them, the report further related. Moreover, O'Hara allegedly repaid a $687,000 bridge loan to Madoff's securities firm. "There would be no reason for a criminal conspirator, motivated by greed, to repay a loan that could have been simply forgiven or forgotten," O'Hara's memorandum said, the report added. "It strains credulity to believe that the compulsive, controlling [Madoff], who regarded [O'Hara and Perez] as 'two dopey computer guys' according to [DiPascali], would have allowed them to be 'in' on the scheme." The case is USA v. Daniel Bonventre et al., case number 1:10-cr- 00228, in the U.S. District Court for the Southern District of New York. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.). From recoveries in lawsuits coupled with money advanced by SIPC, Mr. Picard has paid about 58 percent of customer claims totaling $17.3 billion. The most recent distribution was in March 2013. Mr. Picard has collected about $9.35 billion, not including an additional $2.2 billion that was forfeit to the government and likewise will go to customers. Picard is holding almost $4.4 billion he can't distribute on account of outstanding appeals and disputes. The largest holdback, almost $2.8 billion, results from disputed claims. BERNARD L. MADOFF: UK Court Rejects Feeder Fund's Clawback Suit --------------------------------------------------------------- Law360 reported that a U.K. appeals court decided that Fairfield Sentry Ltd., which fed billions of investor dollars into Bernard Madoff's notorious Ponzi scheme, couldn't recover payments made to investors who redeemed their shares before the scheme collapsed because certificates documenting the transactions were binding. According to the report, the Judicial Committee of the Privy Council, overturning a decision by a lower judge, said the mutual fund couldn't rescind the transactions because monthly emails, contract notes and monthly statements of account issued surrounding the redemptions communicated information in documentary form and thus qualified as "certificates." The fund's liquidators, who are trying to claw back proceeds from shares redeemed in the years before Madoff's December 2008 arrest, argued that the financial institutions were mistakenly paid out because Bernard L. Madoff Investment Securities LLC didn't actually have the assets that it claimed, the report related. They also argued that the word "certificate" had no standard meaning and that what constituted a certificate depended on the commercial or legal context in which the certification clause appeared, the report further related. But the appeals court replied: "There is no rational ground for regarding finality as desirable in some cases but not in others, according to the discretionary decision of the directors or their delegates. Such a discretion, if it existed, could only operate capriciously, and is therefore most unlikely to have been intended by the draftsman," the report added. The case is Quilvest Finance Ltd. et al. v. Fairfield Sentry Ltd., case number JCPC 2013/0061, before the Judicial Committee of the Privy Council. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.). From recoveries in lawsuits coupled with money advanced by SIPC, Mr. Picard has paid about 58 percent of customer claims totaling $17.3 billion. The most recent distribution was in March 2013. Mr. Picard has collected about $9.35 billion, not including an additional $2.2 billion that was forfeit to the government and likewise will go to customers. Picard is holding almost $4.4 billion he can't distribute on account of outstanding appeals and disputes. The largest holdback, almost $2.8 billion, results from disputed claims. BOB & STAN: Condo Units in Goodyear, AZ to Be Sold May 20 --------------------------------------------------------- Property of Bob & Stan LLC will be sold at public auction to the highest bidder, at the law offices of Quarles & Brady LLP, Two North Central Avenue, Phoenix, Maricopa County, Arizona, on May 20, 2014 at 10:00 a.m. The assets consist of Units 25 through 32, inclusive, Units 45 through 60, inclusive, Units 73 through 88, inclusive, and Units 100 through 107, inclusive, Building 7, Palm Valley Professional Plaza Condominiums, Phase 1, as well as parking spaces numbered 50, 52, 54 and 56. The assets are located at 3000 N. Litchfield Road Goodyear, Arizona. Quarles, as Trustee, will sell all assets that serve as collateral to debt owed under a promissory note in the original principal balance of $846,000 owed to: Wells Fargo Bank, National Association c/o Hudson Americas, LLC Its Attorney-in-Fact 2711 North Haskell Ave., Suite 1800 Dallas, Texas 75204 The current Trustee may be reached at: James L. Ugalde, Esq. QUARLES & BRADY LLP Renaissance One Two North Central Avenue Phoenix, AZ 85004-2391 Telephone: 602-229-5200 E-mail: elizabeth.hibbs@quarles.com BROWNSVILLE MD: Part Owners Balk at Pineda's Bid for Stay Relief ---------------------------------------------------------------- C. Lynn Anderson, MD, and Vicki Miles Rodriguez, creditors and parties-in-interest in the case of Brownsville MD Ventures, LLC, asked that the Bankruptcy Court deny Pineda Grantor Trust II's motion for relief from the automatic stay. The objectors, part owners of the Debtor, also adopt the position of the Debtor in response to the motion for relief. The objectors asserted that the Trust is a vulture fund, having acquired its claims and interest post-default from the prior lender for pennies-on-the-dollar, and accordingly, the trust is not a holder in due course to any of the commercial paper or commercial liens and rights claimed by the Trust. In a separate filing, the objectors responded to trial brief filed by the Trust. They argued that the Trust's trial brief missed the point of the applicable code, law and standards for a single asset real estate to make adequate protection payments. The Trust filed the trial brief concerning its lien rights as to the cash held by the Debtor. The Trust stated that it holds a valid perfected lien in the Debtor's cash, and requested that the Court grant its motion to lift stay and require the Debtor to turn over all cash it holds as the Debtor cannot adequately protect its cash collateral. The Trust's trial brief provides that, among other things: 1. The Debtor holds approximately $400,000 in cash. Since the filing of the bankruptcy, the Debtor and Pineda have entered into a series of cash collateral orders that preserved Pineda lien rights to the cash to the same extent those rights existed prior to the bankruptcy. It is undisputed that the cash held by the Debtor is traceable to litigation initiated by the Debtor and Brownsville Doctors Hospital, the Debtor's former tenant, as the cash represents the settlement of property damage claims related to the real property owned by the Debtor. By an agreement between Brownsville Doctors Hospital and the Debtor, the payment of the litigation proceeds would also be considered the payment of past due rent owed by Brownsville Doctors Hospital to the Debtor. 2. The Debtor executed Deeds of Trust in favor of Texas State Bank, such Deeds of Trust now held by Pineda. The Deeds of Trust properly create a lien in favor of Pineda on the real property. As reported in the Troubled Company Reporter on March 25, 2014, the Debtor asked Judge Richard Schmidt to deny the motion to lift the automatic stay filed by Pineda. A lawyer representing the Trust had asked the bankruptcy judge to lift the injunction so that the Trust can foreclose on its collateral -- a real property owned by Brownsville in Cameron County, Texas. The lawyer argued the trust's interest is not "adequately protected." Brownsville argued that it has sufficient equity in the real property to protect the interest of the Trust and that the property is necessary for its restructuring. "The debtor's bankruptcy case is a SARE case," said its lawyer, Kell Mercer, Esq., at Husch Blackwell LLP, in Austin, Texas. He pointed out that the real property is the most significant asset of the company. "Without the real property, the Debtor's plan of reorganization cannot be implemented," Mr. Mercer said. About Brownsville MD Ventures Brownsville MD Ventures, LLC, was formed in 2004 for the purpose of acquiring real property and improvements in Brownsville, Texas. The company leased the property to Brownsville Doctors Hospital, LLC, which operated a hospital on the premises. The tenant has ceased operations, and the property has been vacant since August 2012. Brownsville MD Ventures filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 13-10341) on Aug. 26, 2013, in Brownsville, Texas. Chester Gonzalez, the managing member and the chairman of the board of managers, signed the bankruptcy petition. The Debtor disclosed $24 million in assets and $14.7 million in liabilities in its schedules. The Debtor's property was appraised by Compass Bank in July 2011 with a fair market value in excess of $20,000,000. Pineda Grantor Trust II, as assignee of Compass Bank (which provided a loan to finance the acquisition of the property), is the secured lender. Kell Corrigan Mercer, Esq., at Husch Blackwell, LLP, in Austin, Texas, serves as the Debtor's counsel. The Debtor tapped The Rentfro Law Firm PLLC as special counsel to provide legal advice regarding business matters. Judge Richard S. Schmidt presides over the case. BUILDING MATERIALS: S&P Revises Outlook to Pos. & Affirms 'B' CCR ----------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its rating outlook on Boise, Idaho-based Building Materials Holding Corp. to positive from stable and affirmed its 'B' corporate credit rating on the company. At the same time, S&P affirmed its 'B-' issue-level rating on the company's senior notes. The recovery rating remains '5', which indicates S&P's expectation that lenders will receive modest recovery (10% to 30%) in the event of a default. "The positive outlook reflects our expectation for BMC's leverage measures to strengthen in the next two years along with increasing U.S. housing construction activity," said Standard & Poor's credit analyst Thomas Nadramia. S&P would upgrade BMC if it would anticipate the company being able to achieve leverage measures more in line with a one-notch higher rating through the cycle (i.e., debt to EBITDA on average in the low 3.5x area). This could occur along if U.S. new home construction recovered towards its historical average levels of about 1.5 million starts. For a higher rating, S&P would also expect that the company could fund its anticipated working capital growth from internal sources such that consistently generated modestly positive free cash flow. A revision of the outlook to stable could occur if fewer-than- expected housing starts due to an economic slowdown, recession, or higher home mortgage interest rates (S&P's economists place a 10%- 15% probability on a new recession) were to result in less improvement in profitability. S&P views a downgrade as unlikely in the near term given its view of improving U.S. housing fundamentals; however, one could occur if BMC's liquidity were to become constrained, due to an unexpected reversal in housing starts (due to recessionary pressures or a large increase in mortgage interest rates) or a material decrease in profit margins due to increased competition or volatile material costs that would cause leverage to exceed 6x. Other risks to S&P's anticipated EBITDA growth include volatile lumber prices (which can increase working capital needs or depress margins) and increased price competition if more competitors enter BMC's markets as housing starts increase. CANDY INTERMEDIATE: Moody's Lowers CFR to 'B3'; Outlook Stable -------------------------------------------------------------- Moody's Investors Service downgraded Candy Intermediate Holdings, Inc.'s (a wholly owned subsidiary of Ferrara Candy Company Holdings, Inc.) Corporate Family Rating (CFR) and Probability of Default Rating (PDR) to B3 from B2 and B3-PD from B2-PD, respectively. The outlook remains stable. The downgrade is largely the result of the company's weak financial metrics including high leverage and its weakened liquidity profile which has resulted from operating performance in FY13 that was well below Moody's expectations. The following ratings have been downgraded for Candy Intermediate Holdings, Inc.: Corporate Family Rating to B3 from B2; Probability of Default Rating to B3-PD from B2-PD; and $425 million senior secured term loan B due June 2018 to Caa1 (LGD4, 62%) from B3 (LGD4, 59%). The rating outlook is stable Ratings Rationale The B3 Corporate Family Rating reflects Ferrara's weak credit metrics including high leverage with debt-to-EBITDA of greater than 7.5 times, thin interest coverage, relatively weak profit margins and negative free cash flow-to-debt during FY13. Ferrara has a limited operating history as a combined entity, a high degree of seasonality in its earnings and cash flow, and competes against both private label and larger players with greater financial resources and brand recognition in a challenging consumer spending environment. Accordingly, Moody's view Ferrara as a price follower in the category with lower margins, particularly in periods of rising commodity prices. The company's key inputs are sugar, high-fructose corn syrup and packaging materials. Recently, commodity pressures have eased and Ferrara has locked in favorable pricing through the end of the FY14, which will benefit margins in the near-to-intermediate term. The rating also considers the company's private equity ownership and possible event risk in the form of future dividend payments. At the same time, the rating recognizes the company's good scale and market position in the US non-chocolate confectionary category. Ferrara maintains a solid product portfolio with a number of well- recognized brands, has reduced exposure to seasonal candies post- merger, and has good channel diversification and a moderate degree of customer concentration. Anticipated synergy savings in connection with the merger have taken longer than expected to be fully realized; however, Moody's expect the company will generate approximately $30 - $35 million of annualized run-rate synergies in FY14. The stable outlook reflects Moody's expectation that liquidity will tighten as the year progresses but that the company will maintain at least $30 million of ABL availability at all times and that earnings and cash flow will improve over the next twelve to eighteen months. The outlook also anticipates that leverage will improve from currently high levels to be in the range of 6.0 to 6.5 times at FYE14. The ratings could be downgraded if ABL borrowings exceed Moody's expectations, which would be driven by lower than anticipated cash flow generation. Also, if adjusted debt-to-EBITDA leverage as measured by Moody's climbs above 8.0 times or if the company fails to restore EBITA-to-interest to above 1.0 time, the ratings could be downgraded. Although not anticipated in the near term, the ratings could be upgraded if debt-to-EBITDA leverage as measured by Moody's improves and is sustained below 6.0 times, EBITA-to-interest climbs above 1.5 times, and the company reduces ABL reliance. The principal methodology used in this rating was the Global Packaged Goods published in June 2013. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Ferrara Candy Company (Ferrara), a subsidiary of Candy Intermediate Holdings, Inc., is primarily a manufacturer of branded non-chocolate products, private label confectionary products as well as a participant in various co-manufacturing programs. Ferrara was formed in June 2012 through the merger of Farley's and Sathers Inc. (F&S) and Ferrara Pan Candy Co, Inc. (Ferrara Pan). The company is understood to be the third largest US based non-chocolate confectionary company with one of the broadest product portfolios in the category. Ferrara's brands include Brach's, Bob's, Black Forest, Trolli, Lemonheads, Jujyfruits, Atomic Fireballs, Boston Baked Beans, Chuckles, and Now and Later. The company is majority owned by Catterton Partners. Net sales for the twelve months ended December 31, 2013 were approximately $835 million. CANYON COMPANIES: Moody's Assigns 'B2' Corp. Family Rating ---------------------------------------------------------- Moody's Investors Service assigned first time ratings to Canyon Companies S.A.R.L. and GTCR Valor Companies, Inc. including a B2 corporate family rating and B2-PD probability of default rating. The companies are being set up by private equity group GTCR to acquire certain key assets of Vocus Inc. and Cision AB. The proposed first lien facilities are rated B1 and the proposed second lien facilities are rated Caa1. The ratings outlook is stable. Ratings Rationale The B2 corporate family rating reflects the high leverage of the new company and recent revenue declines balanced by the leading positions of Vocus and Cision in the PR software market and benefits of combining the businesses. Vocus and Cision are each leaders in various segments of the PR software industry and the combination should further enhance their position. Their products provide critical software and contact database tools for PR professionals to target PR campaigns and track them across multiple media channels including publishing, broadcasting, blogs and social media. The transaction is complex however, requiring divestitures by both companies and integration of remaining operations. Given the divestitures, historical audits are of limited use in assessing the new entity. The companies have significant overlap in products and should be able to reduce duplicative functions in multiple areas fairly quickly after closing. Debt to EBITDA will be high at closing (estimated at 6.7x pro forma for the divested operations and myriad adjustments) but substantially less pro forma for the synergies contemplated within the first two years. Leverage is expected to fall below 5x within 12-18 months of closing driven by the pace that the company can realize synergies. Free cash flow is expected to exceed $30 million in the year after closing and free cash flow to debt is expected to exceed 7%. The company is considered weakly positioned in the B2 category initially given the high starting leverage and integration challenges. Ratings could be downgraded if the integration falters or leverage is not on track to get to 5.5x or free cash flow to debt is not on track to get to 7% or greater. Though unlikely in the near term given the integration challenges, the ratings could be upgraded if leverage is sustained below 4x. Liquidity is limited at closing with an estimated $10 million of cash but improves with the expectation of greater than $30 million of free cash flow over the year post closing. Liquidity is also supported by an undrawn $25 million revolver which is subject to certain limitations and financial covenants. The following ratings were assigned: Issuer: Canyon Companies S.A.R.L. (Parent of GTCR Valor Companies, Inc.) Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Issuer: GTCR Valor Companies, Inc. (Borrower) 1st Lien Senior Secured Revolving Credit Facility, Assigned B1, LGD3, 36 % 1st Lien Senior Secured Term Loan Credit Facilities, Assigned B1, LGD3, 36 % 2nd Lien Senior Secured Term Loan Credit Facilities, Assigned Caa1, LGD5, 88 % Ratings Outlook: Stable The principal methodology used in this rating was Global Software Industry published in October 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Vocus, and Cision, headquartered in Beltsville, MD and Stockholm, Sweden respectively together generated approximately $313 million of reported revenue in 2013. COOPER-BOOTH: Has May 14 Confirmation for 100% Plan --------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Cooper-Booth Wholesale Co., a convenience-store wholesaler, is scheduled to have a confirmation hearing in bankruptcy court on May 14 to seek approval of a Chapter 11 plan that pays all creditors in full. According to the report, a bankruptcy judge in Philadelphia approved the disclosure statement explaining the workings of the plan. The creditors' committee supports the plan, the report related. The plan will be financed with a new $35 million credit provided by AloStar Business Credit and Susquehanna Bank, according to the disclosure statement, the report added. The owners can retain the equity because everyone is paid in full, with interest, the report said. About Cooper-Booth Wholesale Cooper-Booth Wholesale Company, L.P. and two affiliates sought Chapter 11 protection (Bankr. E.D. Pa. Lead Case No. 13-14519) in Philadelphia on May 21, 2013, after the U.S. government seized the Company's bank accounts to recover payments made by a large customer caught smuggling Virginia-stamped cigarettes into New York. Serving the mid-Atlantic region, Cooper is one of the top 20 convenience store wholesalers in the country. Cooper supplies cigarettes, snacks, beverages and other food items from Hershey's, Lellogg's, Bic, and Mars to convenience stores. Cooper has been in the wholesale distribution business since 1865 when the Booth Tobacco Company was incorporated in Lancaster, Pennsylvania. The Company has been family owned and operated for three generations. Aris J. Karalis, Esq., and Robert W. Seitzer, Esq., at Maschmeyer Karalis, P.C., in Philadelphia, serve as the Debtors' bankruptcy counsel. Executive Sounding Board Associates, Inc., is the financial advisor. SSG Advisors, LLC, serves as investment bankers. Blank Rome LLP represents the Debtor in negotiations with federal agencies concerning the seizure warrant. Cooper-Booth Wholesale Company, L.P., and its affiliates filed a joint disclosure statement in respect of its plan of reorganization dated Feb. 28, 2014. The Plan provides for the reorganization of the Debtors and their continued existence after the Effective Date as Reorganized Debtors. The Plan provides for the payment of 100% of the Allowed Claims in each Class. The funds to make the Distributions required under the Plan will be comprised of cash on hand and the loan proceeds from an exit financing facility, which is a senior credit facility in an aggregate amount of $35 million to be provided by an Exit Financing Lender. DETROIT, MI: Pension Deal Approved by One Retirement System ----------------------------------------------------------- Lisa Lambert and Karen Pierog, writing for Reuters, reported that the board of Detroit's General Retirement System has approved economic terms of a settlement with the city that include cuts to pension benefits, putting in place another key component of Detroit's effort to exit bankruptcy by October. Reuters related that the city also has reached a tentative pact with the city's other pension fund, the Detroit Police and Fire Retirement System, whose board is expected to vote later this week. Together, the two pension funds represent some 23,000 active members and retirees. The settlements were incorporated into the city's bankruptcy plan, filed with the federal bankruptcy court. About City of Detroit, Michigan The City of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The City's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Hon. Steven Rhodes oversees the bankruptcy case. Detroit is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing the American Federation of State, County and Municipal Employees and the International Union. Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is representing the United Automobile, Aerospace and Agricultural Implement Workers of America. A nine-member official committee of retired workers was appointed in the case. The Retirees' Committee is represented by Dentons US LLP. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. Judge Rhodes, on May 6, approved the disclosure statement explaining the City's fourth amended plan. Judge Rhodes will commence the hearing on plan confirmation on July 24. Additional confirmation hearing dates, as necessary, will be July 25, July 28-31, August 4-8, and August 11-15. A final pretrial conference on plan confirmation is set for July 23. DETROIT, MI: $1.45 Billion Pension Debt Suit Proceeds ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Detroit filed papers to dismiss some counterclaims in the lawsuit where the bankrupt city sued its two retirement systems to void $1.45 billion in obligations incurred in 2005 and 2006 to fund municipal pensions. According to the report, the city took aim at counterclaims filed by Wilmington Trust Co. as trustee for trusts created by the complicated funding system which Detroit claims to have been concocted to evade limits on how much debt it could incur. Detroit says the trusts made claims three weeks after the last day for filing claims, the report related. The new claims allege fraudulent misrepresentation and denial of due process. Meanwhile, the service corporations, created by the city to funnel interest payments to bondholders, filed papers of their own to dismiss the suit as to them, the report further related. The service corporations quote from Detroit's complaint, filed in January, stating that they were mere instrumentalities of the city created to evade strictures on incurring debt, the report added. The lawsuit is City of Detroit, Michigan v. General Retirement System Corp. (In re City of Detroit, Michigan), 14-04112, U.S. Bankruptcy Court, Eastern District Michigan (Detroit). About City of Detroit, Michigan The City of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The City's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Hon. Steven Rhodes oversees the bankruptcy case. Detroit is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing the American Federation of State, County and Municipal Employees and the International Union. Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is representing the United Automobile, Aerospace and Agricultural Implement Workers of America. A nine-member official committee of retired workers was appointed in the case. The Retirees' Committee is represented by Dentons US LLP. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. DINASO & SONS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: DiNaso & Sons Building Supplies Company, Inc. 520 Industrial Loop Staten Island, NY 10309 Case No.: 14-42298 Chapter 11 Petition Date: May 7, 2014 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Hon. Carla E. Craig Debtor's Counsel: Moneesh K Bakshi, Esq. RASH & BAKSHI 45 Rockefeller Plaza, Suite 2000 New York, NY 10111-2099 Tel: (646) 583-1615 Fax: (845) 818-5331 Email: moneesh.bakshi@rashbakshi.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $10 million to $50 million The petition was signed by John DiNaso, Sr., president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/nyeb14-42298.pdf DOLAN COMPANY: Nantahala Wants Unrestricted Shares Transfer ----------------------------------------------------------- Nantahala Capital Management, LLC requested that the Bankruptcy Court enter an order (a) confirming that Nantahala's postpetition transfers, on behalf of its beneficial owners, of certain common and preferred equity interests in Debtor The Dolan Company, Inc., do not contravene provisions of the Court's stock transfer procedure order; and (b) amending the stock transfer procedure order to provide that it does not restrict transfers of Dolan's 8.5% Series B preferred shares. Nantahala advises and manages accounts for four funds, each with multiple beneficial owners. These funds purchased shares of Dolan's common stock after the Petition Date. In no situation is any fund's holding close to the 1,400,000-share threshold trigger of the Court's stock transfer procedure order. On the Petition Date, the Debtors filed the stock transfer motion. The Debtors requested certain restrictions on the sale of common and preferred stock. On March 25, 2014, the Court entered an interim order approving the stock transfer motion. Nantahala filed an objection to the stock transfer motion but has withdrawn it based on assurances from the Debtors that they would engage in a good-faith attempt to resolve their differences with Nantahala after the stock transfer procedure order was entered. On April 17, the Court entered a final order approving the stock transfer motion. According to Nantahala, no resolution was had, and the Debtor proposed an unworkable solution designed to obstruct Nantahala's Interests -- and not preserve their NOLs. Nantahala also noted that the Debtors' NOLs are not impacted by the common stock holdings of the funds managed by Nantahala under any circumstances, and the Debtors have acted unreasonably, and for ulterior purposes, in dealing with this situation. Alternatively, Nantahala sought confirmatory relief, consistent with many IRS private letter rulings, that accounts of the funds managed by Nantahala may not be aggregated for purposes of compliance with the stock trading procedure order. As reported in the Troubled Company Reporter on April 28, 2014, the Court approved on a final basis, procedures relating to the transfers of Dolan's common stock and 8.5% series B cumulative preferred stock. As of Dec. 31, 2013, the Debtors estimate that they have net operating losses in the amount of approximately $150 million. The NOLs are of significant value to the Debtors and their estates because the Debtors can carry forward their NOLs to offset their future taxable income for up to 20 years, thereby reducing their future aggregate tax obligations. In addition, the NOLs may be utilized by the Debtors to offset any taxable income generated by transactions consummated during the Chapter 11 cases. Pursuant to the final order, a party that has, or, after a proposed transaction, will have, beneficial ownership of at least 1,400,000 shares of common stock or 31,500 shares of Preferred Stock may not consummate any purchase, sale or other transfer of common stock or preferred stock or beneficial ownership of the securities in violation of the procedures, and any such transaction in violation of the procedures is null and void ab initio. About The Dolan Company Minneapolis, Minn.-based The Dolan Company (OTC:DOLN) and its subsidiaries provide professional services and business information to the legal, financial and real estate sectors. The Dolan Company and several affiliates sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case Nos. 14-10614 to 14-10637) on March 23, 2014. The Company has said it expects to emerge from bankruptcy within two months. Judge Brendan L. Shannon oversees the cases. Marc Kieselstein, P.C., Jeffrey D. Pawlitz, Esq., and Joseph M. Graham, Esq., at Kirkland & Ellis LLP, serve as the Debtors' counsel. Timothy P. Cairns, Esq., Laura Davis Jones, Esq., and Michael Seidl, Esq., at Pachulski Stang Ziehl & Jones LLP, serve as local counsel. Kevin Nystrom serves as the Company's chief restructuring officer. Faegre Baker Daniels LLP serves as the Debtors' special counsel; Peter J. Solomon Company serves as financial advisors; and Kurtzman Carson Consultants, LLC, serves s noticing and balloting agent. Deloitte Tax LLP serves as tax advisors. Zolfo Cooper LLC also serves as advisors. Dolan listed $236.2 million in total assets and $185.9 million in total debts at Sept. 30, 2013. The petitions were signed by Vicki J. Duncomb, authorized signatory. Global investment management firm T. Rowe Price Associates, Inc., owns nearly 10% of the company's stock, while James Dolan owns 6.8%. Dolan's e-discovery business, DiscoverReady LLC, did not file a chapter 11 petition and its operations will not be affected by the chapter 11 process. On March 18, 2014, Dolan and its lenders and certain of its swap counterparties executed a restructuring support agreement that sets forth the material terms of the chapter 11 restructuring and secures the support of the secured creditors for that process. In accordance with the RSA, the Company commenced solicitation for votes on the chapter 11 plan from secured creditors, the only parties entitled to vote under the plan of reorganization. The chapter 11 plan contemplates that the secured lenders will become the owner of DiscoverReady and The Dolan Company upon the completion of the restructuring process and each business will be operated as separate and distinct entities. Investment funds managed by Bayside Capital, Inc. will become the majority owner of DiscoverReady and The Dolan Company. Bayside Capital is an affiliate of H.I.G. Capital, a global private investment firm with more than $15 billion of equity capital under management. The chapter 11 plan process will allow the filing subsidiaries of the Company to deleverage its capital structure by reducing its projected secured debt obligations from approximately $170 million to approximately $50 million. The RSA also secures support from the lenders to refinance DiscoverReady's capital structure with a $10 million unfunded secured revolving facility. The existing preferred and common shares will be cancelled and will not receive a recovery in the chapter 11 plan. After emergence from bankruptcy, both The Dolan Company and DiscoverReady LLC will be privately held companies. The lenders are to provide a $10 million DIP loan to fund the cash needs of the Company and DiscoverReady through the reorganization process. Bayside Capital is represented in the case by Akin Gump Strauss Hauer & Feld LLP's Michael S. Stamer, Esq., and Sarah Link Schultz, Esq. An Official Committee of Equity Security Holders is represented by Neil B. Glassman, Esq., GianClaudio Finizio, Esq., and Justin R. Alberto, Esq., at Bayard, P.A., in Wilmington, Delaware; Robert J. Stark, Esq., at Brown Rudnick LLP, in New York; and Steven B. Levine, Esq., at Brown Rudnick LLP, in Boston, Massachusetts. DOMNUS CORP: Case Summary & 5 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Domnus Corp. 4975 Topanga Blvd. Woodland Hills, CA 91364 Case No.: 14-12424 Chapter 11 Petition Date: May 9, 2014 Court: United States Bankruptcy Court Central District Of California (San Fernando Valley) Judge: Hon. Victoria S. Kaufman Debtor's Counsel: M Jonathan Hayes, Esq. SIMON RESNIK HAYES LLP 15233 Ventura Blvd Ste 250 Sherman Oaks, CA 91403 Tel: 818-783-6251 Fax: 818-783-6253 Email: jhayes@srhlawfirm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Leili Flrouzabadi, president. A list of the Debtor's five largest unsecured creditors is available for free at http://bankrupt.com/misc/cacb14-12424.pdf DOTS LLC: Wants Liquidation of Biz Completed Before Plan Filing --------------------------------------------------------------- Dots, LLC, et al., ask the Bankruptcy Court to extend their exclusive periods to file a plan of reorganization until Sept. 17, 2014, and solicit acceptances for that Plan until Nov. 17, 2014. The Debtor relate that store-closing liquidation sales are underway at all of the retail stores and are expected to continue through May 2014. The Debtors have sold over 140 real estate leases, of which 32 have already been assumed and assigned through April. The Court also approved sale procedures for the marketing, auction, and sale of the Debtors' intellectual property, scheduling an auction for May 8, 2014, and an approval hearing for May 13. The Debtors anticipate that the liquidation of their business assets will be completed in June 2014. The Debtor is represented by: Kenneth A. Rosen, Esq. Wojciech F. Jung, Esq. Andrew Behlmann, Esq. LOWENSTEIN SANDLER LLP 65 Livingston Avenue Roseland, NJ 07068 Tel: (973) 597-2500 Fax: (973) 597-2400 About DOTS LLC Dots is a retailer of fashionable clothing, accessories, and footwear for price-conscious women. Dots provides missy and plus size choices to fashion savvy 25 to 35 year old women at approximately 400 retail stores throughout the Midwest, East, and South United States. Dots' workforce includes 3,500 individuals in their stores, distribution center, and corporate headquarters. Dots, LLC, and its affiliates sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 14-11016) on Jan. 20, 2014, to sell some or all of their assets. Lowenstein Sandler LLP serves as counsel to the Debtors. PricewaterhouseCoopers LLP is financial advisor and investment banker. Donlin, Recano & Company, Inc., is the claims and notice agent. As of the Petition Date, the Debtors have outstanding secured debt owed to senior lender Salus Capital Partners, LLC, of which $14.5 million remains outstanding under a revolving facility and $16.1 million is owed under a term facility. The Debtors also have not less than $17 million outstanding under subordinated term loan agreements with Irving Place Capital Partners III L.P. ("IPC") and related entities. Moreover, the Debtors have aggregate unsecured debts of $47.0 million. The Debtors disclosed $51,574,560 in assets and $85,442,656 in liabilities as of the Chapter 11 filing. Salus, the prepetition senior lender and the DIP lender, is represented by Morgan, Lewis & Bockius, LLP. The prepetition subordinated lenders are represented by Okin Hollander & DeLuca, LLP. The Company has arranged to borrow $36 million to keep operating as it reorganizes under court protection. Otterbourg P.C. serves as counsel to the Official Committee of Unsecured Creditors; and FTI Consulting, Inc., serves as its financial advisor. DOTS LLC: Danice Stores Wants to Acquire Store 455 Lease -------------------------------------------------------- Danice Stores, Inc. asks the Bankruptcy Court to deny Dots, LLC, et al.'s motion to approve the assumption and assignment of the lease for Store No. 455 to Mad Dots Lease Acquisition, LLC. Danice asks the Court to direct the Debtor to conduct an auction sale for the 455 lease. Danice related that although it offered $30,000 for the 455 lease, the Debtors rejected its offer to purchase the 455 lease instead chose Mad Dots' 5-lease bid. The Mad Dots lease purchase agreement provides for a reduction of $20,000 per lease for each lease that is not assigned and is not conditioned on the assumption and assignment of all fine leases. Danice Stores is represented by: Nancy L. Kourland, Esq. ROSEN & ASSOCIATES, P.C. 747 Third Avenue New York, NY 10017-2803 Tel: (212) 223-1100 About DOTS LLC Dots is a retailer of fashionable clothing, accessories, and footwear for price-conscious women. Dots provides missy and plus size choices to fashion savvy 25 to 35 year old women at approximately 400 retail stores throughout the Midwest, East, and South United States. Dots' workforce includes 3,500 individuals in their stores, distribution center, and corporate headquarters. Dots, LLC, and its affiliates sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 14-11016) on Jan. 20, 2014, to sell some or all of their assets. Lowenstein Sandler LLP serves as counsel to the Debtors. PricewaterhouseCoopers LLP is financial advisor and investment banker. Donlin, Recano & Company, Inc., is the claims and notice agent. As of the Petition Date, the Debtors have outstanding secured debt owed to senior lender Salus Capital Partners, LLC, of which $14.5 million remains outstanding under a revolving facility and $16.1 million is owed under a term facility. The Debtors also have not less than $17 million outstanding under subordinated term loan agreements with Irving Place Capital Partners III L.P. ("IPC") and related entities. Moreover, the Debtors have aggregate unsecured debts of $47.0 million. The Debtors disclosed $51,574,560 in assets and $85,442,656 in liabilities as of the Chapter 11 filing. Salus, the prepetition senior lender and the DIP lender, is represented by Morgan, Lewis & Bockius, LLP. The prepetition subordinated lenders are represented by Okin Hollander & DeLuca, LLP. The Company has arranged to borrow $36 million to keep operating as it reorganizes under court protection. Otterbourg P.C. serves as counsel to the Official Committee of Unsecured Creditors; and FTI Consulting, Inc., serves as its financial advisor. DOTS LLC: Hearing on IP Assets Sale Set for Tuesday --------------------------------------------------- The Bankruptcy Court will convene a hearing on May 13, 2014, at 10:00 a.m., to consider approval of the sale of Dots, LLC, et al.'s intellectual property assets to the successful bidder. Objections, if any, were due May 9, at 5:00 p.m. The Court authorized the sale of IP assets (trademarks and trademark applications, brand names, Internet domain names, customer lists, and other intellectual property) at a May 8 auction. All objections filed in response to the relief were overruled. There was no stalking horse bidder as of the April 8 order. The IP broker is Hilco Streambank. The Debtor is represented by: Kenneth A. Rosen, Esq. Wojciech F. Jung, Esq. Andrew Behlmann, Esq. LOWENSTEIN SANDLER LLP 65 Livingston Avenue Roseland, NJ 07068 Tel: (973) 597-2500 Fax: (973) 597-2400 About DOTS LLC Dots is a retailer of fashionable clothing, accessories, and footwear for price-conscious women. Dots provides missy and plus size choices to fashion savvy 25 to 35 year old women at approximately 400 retail stores throughout the Midwest, East, and South United States. Dots' workforce includes 3,500 individuals in their stores, distribution center, and corporate headquarters. Dots, LLC, and its affiliates sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 14-11016) on Jan. 20, 2014, to sell some or all of their assets. Lowenstein Sandler LLP serves as counsel to the Debtors. PricewaterhouseCoopers LLP is financial advisor and investment banker. Donlin, Recano & Company, Inc., is the claims and notice agent. As of the Petition Date, the Debtors have outstanding secured debt owed to senior lender Salus Capital Partners, LLC, of which $14.5 million remains outstanding under a revolving facility and $16.1 million is owed under a term facility. The Debtors also have not less than $17 million outstanding under subordinated term loan agreements with Irving Place Capital Partners III L.P. ("IPC") and related entities. Moreover, the Debtors have aggregate unsecured debts of $47.0 million. The Debtors disclosed $51,574,560 in assets and $85,442,656 in liabilities as of the Chapter 11 filing. Salus, the prepetition senior lender and the DIP lender, is represented by Morgan, Lewis & Bockius, LLP. The prepetition subordinated lenders are represented by Okin Hollander & DeLuca, LLP. The Company has arranged to borrow $36 million to keep operating as it reorganizes under court protection. Otterbourg P.C. serves as counsel to the Official Committee of Unsecured Creditors; and FTI Consulting, Inc., serves as its financial advisor. DOTS LLC: Luis Salazar Appointed as Consumer Privacy Ombudsman -------------------------------------------------------------- The Bankruptcy Court has directed the Office of the U.S. Trustee to appoint a consumer privacy ombudsman pursuant to Section 332 of the Bankruptcy Code in the Chapter 11 case of DOTS LLC. Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed: Luis Salazar, Esq. SALAZAR JACKSON Alhambra Circle, Suite 1205 Coral Gables, FL, 33134 Tel: (305) 374-4848 Fax: (305) 397 1021 as the consumer privacy ombudsman in the Chapter 11 case of Dots, LLC. To the best of the U.S. Trustee's knowledge Mr. Salazar is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About DOTS LLC Dots is a retailer of fashionable clothing, accessories, and footwear for price-conscious women. Dots provides missy and plus size choices to fashion savvy 25 to 35 year old women at approximately 400 retail stores throughout the Midwest, East, and South United States. Dots' workforce includes 3,500 individuals in their stores, distribution center, and corporate headquarters. Dots, LLC, and its affiliates sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 14-11016) on Jan. 20, 2014, to sell some or all of their assets. Lowenstein Sandler LLP serves as counsel to the Debtors. PricewaterhouseCoopers LLP is financial advisor and investment banker. Donlin, Recano & Company, Inc., is the claims and notice agent. As of the Petition Date, the Debtors have outstanding secured debt owed to senior lender Salus Capital Partners, LLC, of which $14.5 million remains outstanding under a revolving facility and $16.1 million is owed under a term facility. The Debtors also have not less than $17 million outstanding under subordinated term loan agreements with Irving Place Capital Partners III L.P. ("IPC") and related entities. Moreover, the Debtors have aggregate unsecured debts of $47.0 million. The Debtors disclosed $51,574,560 in assets and $85,442,656 in liabilities as of the Chapter 11 filing. Salus, the prepetition senior lender and the DIP lender, is represented by Morgan, Lewis & Bockius, LLP. The prepetition subordinated lenders are represented by Okin Hollander & DeLuca, LLP. The Company has arranged to borrow $36 million to keep operating as it reorganizes under court protection. Otterbourg P.C. serves as counsel to the Official Committee of Unsecured Creditors; and FTI Consulting, Inc., serves as its financial advisor. DUKE FUNDING: Replacement Collater Mgr. No Impact on Fitch Ratings ------------------------------------------------------------------ Fitch Ratings has been notified of a proposed collateral manager removal and appointment of successor collateral manager for Duke Funding High Grade III. On April 1, 2014, Fitch received notice that the holders of at least 66 2/3% in Aggregate Outstanding Amount of the class A and class B notes have directed the removal of Cairn Financial Products Ltd. as collateral manager and subsequently directed the appointment of Dock Street Capital Management, LLC (Dock Street) as successor collateral manager. The replacement is expected to become effective on May 19, 2014. Terms of the proposed Replacement Collateral Management Agreement have remained almost identical with only minor differences that are not material to the ratings of the transaction. The most senior class in the transaction is currently rated 'Csf', indicating that default appears inevitable for the notes. In addition, Duke Funding High Grade III, Ltd./Inc. (Duke Funding HG III) is no longer in its reinvestment period and remains in an event of default. Given the above, Fitch does not expect the novation to have any impact on the ratings of the notes. Fitch is not a party to the transaction and therefore does not provide consent or approval, as that remains the sole preserve of the transaction parties. Fitch expects to be notified by the trustee when the proposed transfer of asset management responsibilities is completed. DVORKIN HOLDINGS: Trustee Can Pay Property Management Fees ---------------------------------------------------------- Bankruptcy Judge Jack B. Schmetterer authorized Gus A. Paloian, as Chapter 11 trustee for Dvorkin Holdings, LLC, to use funds outside of the ordinary course to pay the increased property management fees to DDL Property, Ltd. The Debtor is also authorized to modify property management agreements between DDL Property, Ltd. and operating entities. The trustee, in its motion, stated the amended property management agreement provides that the fees paid by the operating entities will increase from approximately 5% of gross operating revenue to a sliding scale of between 5% and 10% of gross operating revenue, with the fee percentage increasing as revenue declines. Despite the industry standard to the contrary, DDL does not charge commissions for lease transactions. The Chapter 11 trustee is represented by: James B. Sowka, Esq. SEYFARTH SHAW LLP 131 South Dearborn St., Suite 2400 Chicago, IL 60603 Tel: (312) 460-5000 E-mail: jsowka@seyfarth.com About Dvorkin Holdings, LLC Dvorkin Holdings, LLC, a holding company that has interests in 40 non-debtor entities, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 12-31336) in Chicago on Aug. 7, 2012. The Debtor disclosed $69,894,843 in assets and $9,296,750 in liabilities as of the Chapter 11 filing. Bankruptcy Judge Jack B. Schmetterer oversees the case. Michael J. Davis, Esq., at Archer Bay, P.A., in Lisle, Ill., serves as counsel to the Debtor. The petition was signed by Loran Eatman, vice president of DH-EK Management Corp. The Bankruptcy Court in October 2012 granted the request of Patrick S. Layng, the U.S. Trustee for the Northern District of Illinois, to appoint Gus Paloian as the Chapter 11 Trustee. Seyfarth Shaw, LLP, represents the Chapter 11 Trustee as counsel. Carpenter Lipps & Leland LLP represents the Chapter 11 Trustee as conflicts counsel. E-REWARDS INC: S&P Assigns 'B' Corp Credit Rating; Outlook Stable ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned Dallas-based digital data collection company e-Rewards Inc. a 'B' corporate credit rating. The outlook is stable. At the same time, S&P assigned the company's senior secured credit facility a 'B' issue-level rating, with a '3' recovery rating, indicating S&P's expectation for meaningful (50% to 70%) recovery for lenders in the event of a payment default. The credit facility consists of a $30 million revolving credit facility due 2018 and a $190 million term loan due 2018. "The 'B' corporate credit rating reflects our expectation for limited debt leverage reduction over the intermediate term due to modest discretionary cash flow and an aggressive financial policy. We view e-Rewards' business risk profile as "weak," primarily because of its niche market focus and limited scope of operation, and vulnerability to fluctuations in marketing budgets. The company's adjusted debt leverage was 4.3x (5.8x including redeemable convertible stock as debt) as of Dec. 31, 2013, and private equity ownership underpin our assessment of a "highly leveraged" financial risk profile. These factors are only lightly tempered by e-Rewards' good market position in its niche, strong panel retention rate, and high survey response rate (albeit with a limited track record dating from 1999). We expect e-Rewards to grow revenues at a mid- to high-single-digit percentage rate with a healthy high-teens EBITDA margin. We believe that the company will use its free cash flow for bolt-on acquisitions, and to a lesser extent, debt repayment," S&P said. e-Rewards is a small-to-midsize provider of permission-based digital data collection services to market research agencies focused on conducting online research for clients who serve business-to-business, business-to-consumer, and hard-to-reach audiences. The company provides customers with access to an online portal where they can access information from e-Rewards or Valued Opinions panels, so that they can conduct online market research studies. Members are recruited by invitation or through affiliate marketing and social media channels, and consist primarily of consumers, business decision-makers, and medical professionals. Panel members are incentivized with reward points, local currency credits, or virtual currency to participate in market research surveys. EDEN CRYOGENICS: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Eden Cryogenics, LLC 8500 Rausch Drive Plain City, Oh 43064 Case No.: 14-53294 Chapter 11 Petition Date: May 7, 2014 Court: United States Bankruptcy Court Southern District of Ohio (Columbus) Judge: Hon. Kathryn Preston Debtor's Counsel: Matthew T Schaeffer, Esq. 10 West Broad St, Suite 2100 Columbus, OH 43215 Tel: (614) 229-3289 Email: matthew.schaeffer@baileycavalieri.com - and - Nick V. Cavalieri, Esq. BAILEY CAVALIERI LLC 10 West Broad Street, Suite 2100 Columbus, OH 43215-3422 Tel: (614) 221-3155 Fax: (614) 221-0479 Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Steve L. Hensley, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/ohsb14-53294.pdf EDGENET INC: Lands $6.5MM Purchase Offer Before June Auction ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Edgenet Inc., a provider of cloud-based applications and services, intends to sell its business at auction not later than June 3 unless an offer emerges to top the $6.5 million bid from a buyer already under contract. According to the report, a hearing was set for May 5 in U.S. Bankruptcy Court in Delaware to seek approval of sale procedures. The proposed buyer is PCF Number 2 Inc. in Laguna Hills, California, the report related. The contract with PCF requires court approval of the sale no later than June 5. PCF's payment could be reduced after adjustments in the contract. Edgenet filed for Chapter 11 reorganization in mid-January, saying secured creditors' couldn't agree on a division of sale proceeds, the report further related. An official committee represents former owners, owed $18.5 million, who claim to be secured creditors, the report added. Atlanta-based Edgenet filed a lawsuit seeking a declaration that the former owners allowed their security interest to lapse. 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. ENERGY FUTURE: Posts $609 Million Net Loss for Q1 2013 ------------------------------------------------------ Energy Future Holdings Corp. on Wednesday delivered to the U.S. Securities and Exchange Commission its Form 10-Q report for the quarterly period ended March 31, 2014. EFH posted a net loss of $609 million during the quarter compared to a net loss of $569 million during the same period last year. EFH said operating revenues were $1,517 million during the first quarter compared to $1,260 million during the same period in 2013. EFH said total assets were $35,212 million as of March 31, 2014, against total liabilities of $49,076 million. A copy of the Form 10-Q report is available at http://is.gd/YX4rHm On April 29, 2014, EFH Corp. and the substantial majority of its direct and indirect subsidiaries, including Energy Future Competitive Holdings Company LLC, Energy Future Intermediate Holding Company LLC, and Texas Competitive Electric Holdings Company LLC, but excluding Oncor Electric Delivery Holdings Company LLC and its subsidiaries, filed for Chapter 11 bankruptcy. In connection with the Bankruptcy Filing, TCEH received a binding commitment, subject to certain customary conditions, from certain financial institutions for the debtor-in-possession facility. The TCEH DIP Facility is a Senior Secured, Super-Priority Credit Agreement by and among EFCH, TCEH, and the subsidiaries of TCEH that are Debtors in the Chapter 11 Cases, the lenders that are party thereto from time to time and an administrative and collateral agent. The TCEH DIP Facility provides for up to $4.475 billion in financing upon entry of a final order consisting of (i) a senior secured, super-priority revolving credit facility of up to $1.95 billion, (ii) a senior secured, super-priority delayed- draw term loan in the amount of up to $1.1 billion, and (iii) a senior secured, super-priority term loan in the amount of $1.425 billion. On May 2, 2014, the Bankruptcy Court entered an interim order authorizing the TCEH Debtors to (i) enter into the TCEH DIP Credit Agreement to borrow $2.33 billion in financing consisting of borrowings in an aggregate principal amount of up to (a) $533 million under the Revolving Credit Facility, (b) $1.1 billion under the Delayed-Draw Term Facility, of which up to $1.1 billion may be used to fund the RCT L/C Collateral Account for RCT Letters of Credit (each as defined in the DIP Credit Agreement), and (c) $700 million under the Term Loan Facility to fund General Letters of Credit (each as defined in the TCEH DIP Credit Agreement), of which up to $700 million may be used to fund the General L/C Collateral Account (as defined in the TCEH DIP Credit Agreement); and (ii) pay certain fees related to the administration of the TCEH DIP Facility. RCT refers to Railroad Commission of Texas. On May 5, 2014, the TCEH Debtors and the other parties thereto entered into the TCEH DIP Credit Agreement, which became effective on that date. A full-text copy of the SENIOR SECURED SUPERPRIORITY DEBTOR-IN- POSSESSION CREDIT AGREEMENT Dated as of May 5, 2014 among ENERGY FUTURE COMPETITIVE HOLDINGS COMPANY LLC, as Parent Guarantor, TEXAS COMPETITIVE ELECTRIC HOLDINGS COMPANY LLC, as the Borrower, The Several Lenders from Time to Time Parties Hereto, CITIBANK, N.A., as Administrative Agent and Collateral Agent, DEUTSCHE BANK AG NEW YORK BRANCH, BANK OF AMERICA, N.A. AND MORGAN STANLEY SENIOR FUNDING, INC., as Co-Syndication Agents, BARCLAYS BANK PLC, ROYAL BANK OF CANADA AND UNION BANK, N.A., as Co-Documentation Agents, and CITIGROUP GLOBAL MARKETS INC., DEUTSCHE BANK SECURITIES INC., MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, MORGAN STANLEY SENIOR FUNDING, INC., BARCLAYS BANK PLC, RBC CAPITAL MARKETS AND UNION BANK, N.A. as Joint Lead Arrangers and Joint Bookrunners, is available at http://is.gd/Mmy9bo The Debtors may be reached through: KIRKLAND & ELLIS LLP Attention: Linda K. Myers 300 N. La Salle Street Chicago, IL 60654 Telephone: (312) 862-2322 Facsimile: (312) 862-2200 - and - KIRKLAND & ELLIS LLP Attention: Andres Mena 601 Lexington Avenue New York, NY 10022 Telephone: (212) 446-4737 Facsimile: (212) 446-6460 The Administrative Agent may be reached at: Citibank, N.A. 1615 Brett Road, Building III New Castle, DE 19720 Attention: Bank Loan Syndications Department Telephone: (302) 894-6010 Facsimile: (212) 994-0961 Email: glagentofficeops@citi.com and through: Owen Coyle 1615 Brett Road New Castle, DE 19720 Telephone: (302) 894-6123 Facsimile: (212) 994-0961 Email: owen.leonard.coyle@citi.com and through: Citibank, N.A. Email: shane.azzara@citi.com kirkwood.roland@citi.com allister.chan@citi.com chido.ugochukwu@citi.com The Administrative Agent is represented by: MILBANK, TWEED, HADLEY & MCCLOY LLP 1 Chase Manhattan Plaza New York, NY 10005 Attention: Karen Gartenberg Telephone: (212) 530-5630 Facsimile: (212) 822-5630 The Collateral Agent may be reached at: Citibank, N.A. 1615 Brett Road, Building III New Castle, DE 19720 Attention: Bank Loan Syndications Department Telephone: (302) 894-6010 Facsimile: (212) 994-0961 The General Letter of Credit Issuer may be reached at: Citibank, N.A. 3800 Citibank Center Building B, 3rd Floor Tampa, FL 33610 Attention: US Standby Unit Telephone: (866) 498-8670 Zorijana Migliorini 388 Greenwich Street New York, NY 10013 Telephone: (212) 816-8663 Facsimile: (646) 291-3258 Email: zorijana.migliorini@citi.com Citibank, N.A. as RCT Letter of Credit Issuer, may be reached at: Citibank, N.A. 3800 Citibank Center Building B, 3rd Floor Tampa, FL 33610 Attention: US Standby Unit Telephone: (866) 498-8670 Zorijana Migliorini 388 Greenwich Street New York, NY 10013 Telephone: (212) 816-8663 Facsimile: (646) 291-3258 Email: zorijana.migliorini@citi.com Deutsche Bank AG New York Branch as RCT Letter of Credit Issuer may be reached at: Deutsche Bank AG New York Branch Everardus J Rozing Vice President Standby Letter of Credit Unit Deutsche Bank 60 Wall Street New York, NY 10005 Mail Stop NYC60-3118 Tel: 212 250-1014 Fax: 212 797-0403 Bank of America, N.A. as RCT Letter of Credit Issuer, may be reached at: Bank of America, N.A. Global Trade Operations One Fleet Way, 2nd Floor Mail Code PA6-580-02-30 Scranton, PA 18507 Telephone: 1-800-370-7519 and choose Trade product opt. #1 Client Servicing E-mail Address: tradeclientserviceteamus@baml.com General Fax: 1-800-755-8743 Morgan Stanley Senior Funding, Inc. as RCT Letter of Credit Issuer, may be reached at: Morgan Stanley Loan Servicing 1300 Thames Street Wharf, 4th floor Baltimore, MD 21231 Tel: 443-627-4355 Fax: 718-233-2140 Email: msloanservicing@morganstanley.com Barclays Bank PLC as RCT Letter of Credit Issuer, may be reached at: Barclays Bank PLC, New York Branch 200 Park Avenue New York, New York 10116 Tel: (201) 499-4970 E-mail: xraLetterofCredit@barclays.com Michelle.hsiao@barclays.com Royal Bank of Canada as RCT Letter of Credit Issuer, may be reached at: Royal Bank of Canada Global Loans Administration, NY Three World Financial Center 200 Vesey Street New York, NY 10281 Tel: (212) 428-6322 Fax: (212) 428-2372 Union Bank, N.A. as RCT Letter of Credit Issuer, may be reached at: Union Bank, N.A. Commercial Loan Operations Supervisor Commercial Loan Operations 1980 Saturn Street Monterey Park, CA 91754 Facsimile: 1-800-446-9951 1-323-724-6198 E-Mail: #clo_synd@unionbank.com Telephone: Marvin Morales: 323-720-2113 Maria Suncin: 323-720-2666 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 advisors for the Chapter 11 proceedings are Richard M. Cieri, Esq., Edward O. Sassower, P.C., Stephen E. Hessler, Esq., Brian E. Schartz, Esq., James H.M. Sprayregen, P.C., Chad J. Husnick, Esq., and Steven N. Serajeddini, Esq., at Kirkland & Ellis, LLP; and Mark D. Collins, Esq., and Daniel J. DeFranceschi, Esq., and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A. The Debtors also tapped as financial advisor, Evercore Partners, and as restructuring advisor, Alvarez & Marsal. Epiq Systems is the claims agent. 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. 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. ENERGYSOLUTIONS INC: S&P Raises Corp. Credit Rating to 'B+' ----------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on EnergySolutions Inc. to 'B+' from 'B'. The outlook is stable. At the same time, S&P assigned its 'BB-' issue-level ratings to EnergySolutions' proposed $825 million first-lien facility, which consists of a $125 million revolving credit facility due 2019 and a $700 million term loan due 2021. The recovery rating on the proposed first-lien facility is '2' indicating S&P's expectation of substantial recovery (70% to 90%) in the event of a payment default. "The upgrade reflects the company's reduced debt, improved operating efficiency at its logistics, processing, and disposal facilities, and reduced risk at the Zion project following movement of approximately 25% of the casks holding the spent fuel rods," said Standard & Poor's credit analyst Pranay Sonalkar. S&P expects these factors will allow the company to maintain leverage under 5x even with the loss of the large Magnox contract. EnergySolutions has a leading market position within the radioactive waste industry. It benefits from strong technical expertise as well as vertically integrated assets. The company disposes of more than 80% of Class A Low Level Radioactive Waste (LLRW) and 95% of all commercially available Class A LLRW in the U.S. Barriers to entry in the disposal segment are considerable because of the highly regulated nature of the LLRW industry and the difficulty of obtaining operating licenses. EnergySolutions had long benefited from a sparsely populated competitive landscape, since the one alternative for the disposal of commercial LLRW were at a site in Richland, Wash., which accepts waste only from the Northwest compact states. However, a new entrant to the industry, Waste Control Specialists (WCS, a subsidiary of Valhi Inc.) opened a facility in November 2011 to handle the disposal of Class A, B, and C radioactive waste, which could result in some additional competitive pressure. The stable outlook reflects S&P's view that the company's participation in the highly regulated industry and operational improvements will allow it to generate satisfactory EBITDA margins and good free cash flow over the next 12 months. S&P believes the management and ownership will support credit quality and maintain leverage of around 5x and FFO to total debt of around 12% over the next 12 months consistent with the current rating. Although unlikely, S&P could raise the rating if the company's business risk profile improved as a result of improved operating efficiency, increased diversity, and a lower level of volatility in its profitability. S&P could lower the rating if the company were to face significant challenges at Zion or if the company incurs additional debt such that FFO to total adjusted debt remained below 10% without prospects for improvement. This would require EBITDA margins to be 200 bps lower than S&P's projections. FENWICK AUTOMOTIVE: Says Parent's Suit Belongs In Canada -------------------------------------------------------- Law360 reported that bankrupt Canadian car part manufacturer Fenwick Automotive Products Ltd. told a California federal judge that a securities suit lodged by its parent company, Motorcar Parts of America Inc., was just an inflated contractual suit spurred by "buyer's remorse" and that it belongs in a Canadian court. According to the report, in a memorandum supporting its motion to dismiss several of MPA's complaints, Fenwick, known as Fenco, said MPA has augmented a simple breach of contract claim with irrelevant securities claims. The case is Motorcar Parts of America Inc v. FAPL Holdings Inc et al., Case No. 2:14-cv-01153 (C.D. Calif.). About Fenwick Automotive Based in Toronto, Canada, Fenwick Automotive Products Limited -- http://www.fencoparts.com/-- is a manufacturer and distributor of new and remanufactured aftermarket auto parts -- including steering components (pumps, gears and racks), brake calipers, master cylinders, hub assembly and bearings, clutches and clutch hydraulics, constant velocity drive shafts, water pumps, control arms and loaded struts for the full range of passenger and truck vehicles in use in the markets it serves. Its products are sold through all major distribution channels of the automotive aftermarket throughout the United States, Canada and Mexico. The company's facilities are located in Pennsylvania, New Hampshire, Toronto and Mexico. Fenwick is a party to a forbearance agreement dated as of July 6, 2010, with Royal Bank of Canada, as amended by the forbearance amending agreement dated August 23, 2010. FIRED UP: Hires Barron & Newburger as Counsel --------------------------------------------- Fired Up, Inc. seeks authorization from the U.S. Bankruptcy Court for the Western District of Texas to employ Barron & Newburger PC as counsel, effective Mar. 27, 2014 petition date. The Debtor requires Barron & Newburger to: (a) advise Debtor of its rights, powers, and duties as a debtor-in-possession continuing to manage its assets; (b) review the nature and validity of claims asserted against the property of Debtor and advising Debtor concerning the enforceability of such claims; (c) prepare on behalf of Debtor, all necessary and appropriate applications, motions, pleadings, draft orders, notices, schedules, and other documents and reviewing all financial and other reports to be filed in the chapter 11 case; (d) advise Debtor concerning and preparing responses to, applications, motions, complaints, pleadings, notices, and other papers which may be filed in the chapter 11 case; (e) counsel Debtor in connection with the formulation, negotiation, and promulgation of a plan of reorganization and related documents; (f) perform all other legal services for and on behalf of Debtor which may be necessary and appropriate in the administration of the chapter 11 case and Debtor's business; and (g) work with professionals retained by other parties in interest in this case to attempt to obtain approval of a consensual plan of reorganization for Debtor. Barron & Newburger will be paid at these hourly rates: Barbara Barron $425 Stephen Sather $425 Attorneys $175-$475 Support Staff $20-$100 Barron & Newburger will also be reimbursed for reasonable out-of- pocket expenses incurred. Barron & Newburger received payments from the Debtor in the amount of $90,307.89 during the period from Oct. 17, 2013 to Mar. 23, 2014. The amounts paid consisted of both payments and credits for services performed. The amounts were applied to pay for services performed pre-petition. The firm received a retainer from the Debtor in the amount of $50,000 on Mar. 25, 2014 for use in its bankruptcy. The retainer was paid from the Debtor's funds. Such retainer constitutes a "security retainer" and will be held in the firm's trust account pending further order of the Court and payment from the Debtor in this case. The firm asserts a lien against such retainer for fees and expenses subject to Court approval. The firm is also holding a retainer for noticing costs in the amount of $10,000. Stephen W. Sather, Esq., attorney at Barron & Newburger, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. The Court for the Western District of Texas will hold a hearing on the application on June 5, 2014, at 1:30 p.m. Barron & Newburger can be reached at: Stephen W. Sather, Esq. BARRON & NEWBURGER, P.C. 1212 Guadalupe Street, Ste. 104 Austin, TX 78701 Tel: (512) 476-9103 Ext. 220 Fax: (512) 476-9253 E-mail: ssather@bn-lawyers.com About Fired Up Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. FIRED UP: Hires Hajjar Sutherland as Special Counsel ---------------------------------------------------- Fired Up, Inc. asks for permission from the U.S. Bankruptcy Court for the Western District of Texas to employ Hajjar, Sutherland & Peters, LLP as special counsel, effective Mar. 27, 2014 petition date. The Debtor proposes to employ Hajjar Sutherland to perform the following services for the estate: lease negotiations, general corporate matters, and general trademark and other intellectual property matters. Hajjar Sutherland will be paid at these hourly rates: Robert Wheeler $360 Diana Borden $275 Angela Woodbury $275 Kareem Hajjar $275 Doran Peters $275 Judson Sutherland $275 Whitney Withers $250 Benjamin Ruiz $250 Santiago Diaz $140 Frances Rosales $110 Jessica Metz $110 The principal staff on the file will be Kareem Hajjar, Whitney Withers, Angela Woodbury and Benjamin Ruiz. Hajjar Sutherland will also be reimbursed for reasonable out-of- pocket expenses incurred. Hajjar Sutherland received payments from the Debtor in the amount of $102,328.70 during the year prior to bankruptcy. This averaged $8,527.39 per month. The total fees billed to the Debtor for the past three years averaged $34,798.79 per year. No fees were owed as of the petition date except for fees incurred during the week prior to bankruptcy. The firm has not received a retainer from the Debtor. Kareem Hajjar, Esq., attorney at Hajjar Sutherland, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. The Court for the Western District of Texas will hold a hearing on the application on June 5, 2014, at 1:30 p.m. Hajjar Sutherland can be reached at: Kareem Hajjar, Esq. HAJJAR, SUTHERLAND & PETERS, LLP 3144 Bee Caves Road Austin, TX 78746 Tel: (512) 637-4956 E-mail: khajjar@legalstrategy.com About Fired Up Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. FIRED UP: Names Vernon Law as Special Counsel --------------------------------------------- Fired Up, Inc. asks for authorization from the U.S. Bankruptcy Court for the Western District of Texas to employ The Vernon Law Group, PLLC as special counsel, effective Mar. 27, 2014 petition date. The Debtor requires Vernon Law to prepare 2014 Franchise Disclosure Documents for Johnny Carino's Italian Restaurants, perform franchise registration and renewal filings in applicable states, and provide franchise advice with regard to ongoing business operations. Vernon Law will be paid at these hourly rates: John Vernon $575 Taylor Vernon $275 Vernon Law will also be reimbursed for reasonable out-of-pocket expenses incurred. Vernon Law is owed for fees incurred during the week prior to bankruptcy. Debtor paid The Firm a retainer in the amount of $25,000. John M. Vernon, Esq., attorney of Vernon Law, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. The Court for the Western District of Texas will hold a hearing on the application on June 5, 2014, at 1:30 p.m. Vernon Law can be reached at: John M. Vernon, Esq. THE VERNON LAW GROUP, PLLC 4925 Greenville Avenue, Suite 200 Dallas, TX 75206 Tel: (214) 273-3715 E-mail: jvernon@vernonlawgroup.com About Fired Up Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. FIRST QUANTUM: S&P Assigns 'B+' Rating to $650MM Sr. Sec. Notes --------------------------------------------------------------- Standard & Poor's Ratings Services said that on May 6, 2014, it assigned its 'B+' issue rating to the proposed $650 million senior unsecured notes, due 2022, to be issued by Canada-based metals group First Quantum Minerals Ltd. (FQM). The issue rating on the proposed notes is in line with the corporate credit rating on FQM (B+/Stable/--) and is subject to both the successful issuance and S&P's satisfactory review of the final documentation. S&P understands that some of the proceeds of the proposed notes will be used to pay down part of the company's $3.0 billion revolving credit facility, and the rest will remain on the balance sheet. After issuing the $650 million notes, FQM will have five senior unsecured facilities at the level of the parent FQM Ltd.: -- $650 million senior unsecured notes due 2022; -- $350 million senior unsecured notes due 2019; -- $1.1 billion senior unsecured notes due 2020; -- $1.1 billion senior unsecured notes due 2021; and -- $3.0 billion five-year senior credit facility (the amount was recently increased from $2.5 billion). These instruments rank pari passu and share the same security package consisting of upstream guarantees from intermediate companies between the parent and the operating companies, and from key operating companies excluding Kansanshi and Cobre Panama. S&P estimates that the remaining debt at the operating companies, plus other liabilities, will be less than 15% of FQM's total assets. That said, S&P believes that the proposed notes' recovery prospects will remain sensitive to the amount of future senior and equally ranking debt. S&P's analysis assumes that the $3.0 billion five-year senior credit facility ranks pari passu with the other notes. In addition, at this stage S&P considers that the additional security assigned to the $3.0 billion senior credit facility, in the form of certain intercompany loans, does not represent a material priority over the rest of the notes. FIRSTPLUS FINANCIAL: Lucchese Associate Asks For Mistrial --------------------------------------------------------- Law360 reported that a reputed Lucchese crime syndicate associate sought a mistrial in his prosecution for allegedly draining $12 million from a mortgage lender and forcing its bankruptcy, claiming a New Jersey federal judge infringed his rights and tainted the jury by ejecting him from court. According to the report, Salvatore Pelullo filed a motion asking the court to declare a mistrial in the prosecution of his alleged role in the extortionate takeover of FirstPlus Financial Group, a Texas mortgage lender. Pelullo has been unable to attend his own trial for a month, following an order from U.S. District Court Judge Robert B. Kugler barring Pelullo from the courtroom after he made several outbursts that may have been audible to the jury. Pelullo said in his filing that by expelling him from the courtroom, Kugler violated his Fifth Amendment right to due process and Sixth Amendment right to be assisted by an attorney and tried by an impartial jury, the report related. The judge's decision was unwarranted, according to the brief, because Pelullo's "outbursts" were merely his attempts to confer with counsel and were not significantly disruptive to the proceedings. "Although it is undisputed that Mr. Pelullo made a comment concerning government witness Ken Stein's veracity, it is equally undisputed that he made this comment in the course of conferring with counsel during the course of trial, a right guaranteed by the Sixth Amendment," the brief said, the report further related. "In response to Ken Stein's testimony regarding the receipt of certain information, Mr. Pelullo informed his counsel that Mr. Stein was lying, which was information that counsel could only learn from Mr. Pelullo, the report added. In short, Mr. Pelullo was assisting his counsel in the precise manner that a defendant is supposed to do during the course of a trial." The case is U.S. v. Scarfo et al., case number 1:11-cr-00740, in the U.S. District Court for the District of New Jersey. About FirstPlus Financial Based in Beaumont, Texas, FirstPlus Financial Group, Inc. (Pink Sheets: FPFX) -- http://www.firstplusgroup.com/-- was a diversified company that provided commercial loan, consumer lending, residential and commercial restoration, facility (janitorial and maintenance) services, insurance adjusting services, construction management services and a facilities and restoration franchise business. The Company had three direct subsidiaries, Rutgers Investment Group, Inc., FirstPlus Development Company and FirstPlus Enterprises, Inc. In turn, FirstPlus Enterprises, Inc., had three of its own direct subsidiaries, FirstPlus Restoration Co., LLC, FirstPlus Facility Services Co., LLC and The Premier Group, LLC. FirstPlus Restoration and FirstPlus Facility jointly owned FirstPlus Restoration & Facility Services Company. Additionally, FirstPlus Development had one direct subsidiary FirstPlus Acquisitions-1, Inc. A subsidiary of FirstPlus Financial Group -- FirstPlus Financial Inc. -- filed for Chapter 11 bankruptcy in March 1999 before the U.S. Bankruptcy Court for the Northern District of Texas, Dallas Division, amid turmoil in the asset-backed securitization markets and the lack of a reliable, committed secondary take-out source for high LTV loans. A modified third amended reorganization plan was confirmed in that case in April 2000. FirstPLUS Financial Group filed for Chapter 11 protection (Bankr. N.D. Tex. Case No. 09-33918) on June 23, 2009. Aaron Michael Kaufman, Esq., and George H. Tarpley, Esq., at Cox Smith Matthews Incorporated, served as counsel. The Debtor had total assets of $15,503,125 and total debts of $4,539,063 as of June 30, 2008. FirstPLUS Financial Group disclosed $1,264,637 in assets and $10,347,448 in liabilities as of the Chapter 11 filing. Matthew D. Orwig was appointed as the Chapter 11 trustee in the Debtor's cases. He is represented by Peter A. Franklin, Esq., and Erin K. Lovall, Esq., at Franklin Skierski Lovall Hayward LLP. Franklin Skierski was elevated to lead counsel from local counsel in the stead of Jo Christine Reed and SNR Denton US LLP, due to the maternity leave of Ms. Reed. Kurtzman Carson Consultants served as notice and balloting agent. FLETCHER INTERNATIONAL: Skadden Arps Settlement Approved -------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the trustee for the Fletcher International Ltd. master fund won approval of a liquidating Chapter 11 plan in late March and obtained court endorsement of a settlement under which law firm Skadden Arps Slate Meagher & Flom LLP pays $4.25 million for a release of claims the trustee might have pursued. According to the report, Skadden said there was no basis for liability, contending that its representation was limited to certain proceedings in Delaware state court. According to Richard J. Davis, the Chapter 11 trustee, Fletcher "did not make a single profitable investment after Aug. 31, 2007," the report further related. According to Davis, four public pension funds that invested $125 million will receive 90 percent of all recoveries, the report added. The disclosure statement listed about $120 million in unsecured claims to share equally in lawsuit recoveries. About Fletcher International Fletcher International, Ltd., filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-12796) on June 29, 2012, in Manhattan. The Bermuda exempted company estimated assets and debts of $10 million to $50 million. The bankruptcy documents were signed by its president and director, Floyd Saunders. David R. Hurst, Esq., at Young Conaway Stargatt & Taylor, LLP, in New York, serves as counsel and Appleby (Bermuda) Limited serves as special Bermuda counsel. The Debtor disclosed $52,163,709 in assets and $22,997,848 in liabilities as of the Chapter 11 filing. Fletcher International Ltd. was managed by the investment firm of Alphonse "Buddy" Fletcher Jr. Fletcher Asset Management was founded in 1991. During its initial four years, FAM operated as a broker dealer trading various debt and equity securities and making long-term equity investments. Then, in 1995, FAM began creating and managing a family of private investment funds. The Debtor is a master fund in the Fletcher Fund structure. As a master fund, it engages in proprietary trading of various financial instruments, including complex, long-term, illiquid investments. The Debtor is directly owned by Fletcher Income Arbitrage Fund and Fletcher International Inc., which own roughly 83% and 17% of the Debtor's common shares, respectively. Arbitrage's direct parent entities are Fletcher Fixed Income Alpha Fund and FIA Leveraged Fund, both of which are incorporated in the Cayman Islands and are subject to liquidation proceedings in that jurisdiction, and which own roughly 76% and 22% of Arbitrage's common stock, respectively. The Debtor currently has a single subsidiary, The Aesop Fund Ltd. After filing for Chapter 11 protection, Fletcher immediately started a lawsuit in bankruptcy court to stop the involuntary bankruptcy in Bermuda. Judge Gerber at least temporarily halted liquidators appointed in the Cayman Islands from moving ahead with proceedings in Bermuda. The lawsuit to halt the Bermuda liquidation is Fletcher International Ltd. v. Fletcher Income Arbitrage Fund, 12-01740, in the same court. Richard J. Davis, Chapter 11 trustee appointed in the case, has hired Michael Luskin, Esq., Lucia T. Chapman, Esq., and Stephanie E. Hornung, Esq., at Luskin, Stern & Eisler LLP as his counsel. The Chapter 11 trustee filed a proposed liquidating Plan in November 2013. The disclosure statement was approved on Jan. 17, 2014. Judge Gerber has confirmed the Second Amended Plan of Liquidation late in March 2014. FLORENCE MEDICAL: Assets to Be Auctioned Off July 22 ---------------------------------------------------- Craig K. Williams, Esq., as agent for CREI Florence Healthcare, LLC, as secured party, will sell property of Florence Medical Alliance, LLC, to the highest qualified bidder in public on July 22, 2014, at 1:30 p.m. The auction will be held at: THE LAW OFFICES OF SNELL & WILMER L.L.P. One Arizona Center 400 East Van Buren Phoenix, AZ The assets to be sold include a portion of Lot 1 and Tract A at the Florence Community Medical Center, as well as personal property, receivables, causes of action and claims. There is no warranty relating to title, possession, quiet enjoyment or the like in this disposition. The collateral will be sold AS-IS, WITHOUT RECOURSE AND WITHOUT WARRANTIES, EITHER EXPRESS OR IMPLIED. To qualify to bid at the public sale, each person must qualify with the Agent on or before the sale date by providing name, address, phone number, and a $10,000 deposit, in cash or cashier's check, made payable to Agent. The successful bidder has until 5:00 p.m. (Arizona time) on the following business day (presently July 23, 2014) to pay the entire purchase price at the public sale, less the $10,000 deposit previously held by Agent, in a form acceptable to Agent. If the successful bidder does not complete the payment in full of the purchase price by 5:00 p.m. (Arizona time) on the next business day (presently July 23, 2014), then Agent shall have the right to retain the $10,000 deposit to offset fees, costs and expenses of Secured Party. At the Secured Party's election, the Agent may either sell the property to the next highest bidder, or hold a subsequent public sale, notifying all parties who had registered in writing with Agent on the date of the original sale, setting forth the time and place of the subsequent public sale. The secured party may be reached at: CREI FLORENCE HEALTHCARE, LLC 1222 South Vista Avenue Boise, ID 83705 Attention: Bart Cochran Florence Medical Alliance, LLC, is represented by: Christopher L. Raddatz, Esq. FENNEMORE CRAIG, PC 2394 East Camelback Road, Suite 600 Phoenix, AZ 85016 -- and -- Scott D. McDonald, Esq. FENNEMORE CRAIG, PC One South Church Avenue, Suite 1000 Tucson, AZ 85701 Fennemore Craig also represents DivLend Equipment Leasing, L.L.C., Clearwater 2008 Note Program, L.L.C. FOREST OIL: S&P Puts 'B-' CCR on CreditWatch Positive ----------------------------------------------------- Standard & Poor's Ratings Services said it placed its ratings on Forest Oil Corp., including its 'B-' corporate credit rating, on CreditWatch with positive implications, meaning that S&P could either raise or affirm the ratings following the completion of its review. As of March 31, 2014, Forest Oil had approximately $800 million of total debt outstanding. The combined entity would have pro forma debt outstanding of about $2.2 billion. The rating action follows the company's announcement that Forest Oil Corp. and Sabine Oil & Gas LLC will merge and form a newly incorporated publicly traded holding company, Sabine Oil & Gas Corp. (on a pro forma basis, Sabine shareholders would own an estimated 74% and Forest shareholders would own about 26% of the merged company). Sabine plans to issue new debt to refinance Forest Oil's existing debt, which contains change-of control put provisions. "We will resolve the CreditWatch listing for Forest Oil upon completion of the proposed transaction," said Standard & Poor's credit analyst Mark Salierno. "We expect the corporate credit rating for Forest Oil would be raised by one notch to 'B', equal to the existing corporate credit rating on Sabine Oil & Gas LLC. We would withdraw the ratings on Forest's debt if this debt is repaid upon completion of the transaction, which is expected to close later in 2014." FREE LANCE-STAR: Credit Bid Barred for Inequitable Conduct ---------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that Sandton Capital Partners, the principal secured creditor owed $37.9 million by the Free Lance-Star newspaper and radio stations, employed an "overly zealous loan-to-own strategy" and engaged in "inequitable conduct" by attempting to depress the sale price, U.S. Bankruptcy Judge Kevin R. Huennekens said in an opinion on April 14. According to the report, Judge Huennekens's opinion describes how Sandton bought the loan in June and tried unsuccessfully to persuade Free Lance that it should sell the business to the lender in bankruptcy in about six weeks, without marketing. The judge said the lender tried to "frustrate competitive bidding" by sending offering materials showing it had the right to credit bid, or use its claim as currency in an auction rather than cash. The judge said Sandton learned after buying the loan that it didn't have liens on all assets, the report related. Judge Huennekens ruled that property free of lien includes broadcasting towers, licenses from the Federal Communications Commission, vehicles, insurance policies and cash. To foster a competitive environment for an auction, the judge is only allowing Sandton to credit bid $12.7 million for the newspapers and $1.2 million for the broadcasting assets, the report further related. Judge Huennekens said in his opinion that Sandton didn't submit any witnesses to show that it's conduct wasn't inequitable, the report added. The only witness it did proffer was "not credible," in the judge's view. Judge Huennekens also said that a declaration filed by Sandton was "both false and misleading." * * * Mr. Rochelle separately reported that the Free Lance-Star bankruptcy is shaping up to be the second case in three months in which a court has limited a secured lender's ability to bid on a company's assets using the debt rather than cash, a process known as credit bidding. According to the report, the secured lender is Sandton Capital Partners, owed $37.9 million on a loan it bought in June. Judge Huennekens in Richmond, Virginia, took a page from the playbook of a Delaware bankruptcy court by allowing Sandton to credit bid only $13.9 million of the secured claim at auctions scheduled for May 15, according to papers filed by the bankrupt company, the report related. Judge Huennekens held three hearings in March where he was asked to follow the example of the Delaware judge in the Fisker Automotive Inc. bankruptcy who let a lender credit bid using only $25 million of a $168.5 million secured claim, the report further related. According to the newspaper's lawyers, Judge Huennekens concluded that Sandton didn't have liens on all the assets, the report added. He also said, according to the bankrupt company, that Sandton engaged in "inequitable conduct," one of the grounds on which the Fisker judge limited credit bidding. About The Free Lance-Star Publishing The Free Lance-Star Publishing Co. of Fredericksburg, Va., is a publishing, newspaper, radio and communications company based in Fredericksburg, Virginia and owned by the family of Josiah P. Rowe III. FLS's single, seven-day a week newspaper, The Free Lance- Star was first published in 1885 when a group of local Fredericksburg merchants and businessmen created the paper to serve the news and advertising needs of the community. FLS also owns radio stations WFLS-AM, FLS-FM, and WVBX. FLS owns the community and news portal http://www.fredericksburg.com/ FLS filed a Chapter 11 bankruptcy petition (Bankr. E.D. Va. Case No. 14-30315) in Richmond, Virginia, on Jan. 23, 2014. William Douglas Properties, L.L.C., a related entity that owns a portion of the land pursuant to which FLS operates certain aspects of its business, also sought bankruptcy protection. Judge Keith L. Phillips was initially assigned to the cases, but the cases were reassigned to Judge Kevin R. Huennekens on the Petition Date. The Debtors have tapped Tavenner & Beran, PLC, as counsel; and Protiviti, Inc., as financial advisor. Judge A. Robbins, U.S. Trustee for Region 4, appointed three members to the official committee of unsecured creditors. FREEDOM INDUSTRIES: Bankruptcy Lawyers, Advisers Bill $1.9MM ------------------------------------------------------------ Peg Brickley, writing for The Wall Street Journal, reported that the company behind the chemical spill that tainted the water supply of 300,000 people in West Virginia spent $1.9 million on attorneys and advisers in the first months of its bankruptcy case. Freedom Industries Inc.'s lead bankruptcy law firm, McGuireWoods LLP, billed top dollar, the report related, citing court papers filed Tuesday. The law firm charged nearly $746,000 in fees and expenses for work performed between Jan. 17, when Freedom filed for bankruptcy, and the end of March. Two specialist law firms, one for environmental matters and one for litigation, billed a combined $535,000 in fees and expenses for work during the same timeframe, the report further related. According to the report, less than 5% of the bills from bankruptcy professionals come from lawyers representing Freedom's committee of unsecured creditors, whose members include people claiming injury or other damages from the disastrous Jan. 9 chemical spill from a Freedom-owned tank farm. Chemical contamination resulted in a ban on use of tap water in a nine-county swath of West Virginia and touched off a wave of lawsuits that drove the company into bankruptcy, the report added. Freedom is cleaning up under the eye of regulators and is shutting down under the supervision of a judge. About Freedom Industries Freedom Industries Inc., is engaged principally in the business of producing specialty chemicals for the mining, steel and cement industries. The Debtor operates two production facilities located in (a) Nitro, West Virginia; and (b) Charleston, West Virginia. The company, connected to a chemical spill that tainted the water supply in West Virginia, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. W.Va. Case No. 14-bk-20017) on Jan. 17, 2014. The case is assigned to Judge Ronald G. Pearson. The petition was signed by Gary Southern, president. The Debtor is represented by Mark E Freedlander, Esq., at McGuire Woods LLP, in Pittsburgh, Pennsylvania; and Stephen L. Thompson, Esq., at Barth & Thompson, in Charleston, West Virginia. On Dec. 31, 2013, four companies merged under the umbrella of Freedom Industries: Freedom Industries Inc., Etowah River Terminal LLC, Poca Blending LLC and Crete Technologies LLC. As reported in the Troubled Company Reporter on Feb. 20, 2014, Kate White, writing for The Charleston Gazette, reported that the Debtor disclosed $16 million in assets and $6 million in liabilities when it filed for bankruptcy. On Feb. 5, 2014, the U.S. Trustee appointed an official committee of unsecured creditors. The Committee retained Frost Brown Todd LLC as counsel. On March 18, the Bankruptcy Court approved the hiring of Mark Welch at MorrisAnderson in Chicago as Freedom's chief restructuring officer. GASTAR EXPLORATION: S&P Affirms 'B-' Corporate Credit Rating ------------------------------------------------------------ Standard & Poor's Ratings Services said it affirmed its 'B-' corporate credit rating on Gastar Exploration Inc. and its 'B-' issue-level rating on the company's senior secured notes. At the same time, S&P revised the recovery rating on the company's senior secured notes to '4' from '3'. The '4' recovery rating reflects S&P's expectation of "average" (30%-50%) recovery in the event of a payment default. The revision of the recovery rating is a result of a higher borrowing base on the company's credit facility and lower valuation on the company's year-end 2013 PV-10 (at S&P's distressed price deck) compared with midyear 2013 reserves. "The stable outlook reflects our expectation that Gastar will continue to increase production and reserves in the Marcellus and Hunton Limestone, while maintaining adequate liquidity," said Standard & Poor's credit analyst Stephen Scovotti. S&P could lower the ratings if it expected liquidity to weaken to "less than adequate." S&P believes this could occur if the company is unable to increase production in the Marcellus and Hunton Limestone or if the company materially increases its capital spending plan. S&P would consider an upgrade if the company significantly increases reserves and production in the Marcellus and Hunton Limestone and improves FFO to debt to greater than 20% while maintaining adequate liquidity. GENERAL MOTORS: Cadillac Test Drivers Warned of Ignition Defects ---------------------------------------------------------------- Jeff Bennett, writing for The Wall Street Journal, reported that a U.S. safety regulator released documents showing General Motors Co. ordered a more robust ignition switch before the release of a new Cadillac, stemming from complaints the engine could turn off while driving when the ignition was bumped. According to the report, Delphi Automotive PLC, which made the defective switches used in 2.6 million small cars that are now being recalled, disclosed in a letter to U.S. regulators that GM engineers in February 2006 sought the change after test drivers reported the 2007 Cadillac SRX would stall when their knees bumped the ignition switch while driving. Lawyers for the nation's largest auto maker separately disclosed it plans to fend off most lawsuits over claims linked to its ignition-switch recall using a bankruptcy-protection shield, the report related. The motion, filed in a Texas court, came despite calls from lawmakers and victims' families for the company to forgo the legal maneuver. The Delphi documents released by the National Highway Traffic Safety Administration don't disclose who at GM ordered the change to the Cadillac switch, the Journal further related. Engineers reported the assembly "could move out of place" while driving thus "turning off the car." 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: Texas Judge Rejects Bid for "Park-It" Order ----------------------------------------------------------- Patrick G. Lee, Linda Sandler and Edvard Pettersson, writing for Bloomberg News, reported that General Motors Co. doesn't have to tell car owners they should park the 2.59 million vehicles it recalled over faulty ignition switches, a federal judge ruled, rejecting a bid for what would've been an unprecedented order. According to the report, U.S. regulators are better able than courts to tell the automaker how to manage its recall, U.S. District Judge Nelva Gonzales Ramos ruled in Corpus Christi, Texas. The decision came a day after GM was sued in California in what may be the first complaint naming as a defendant Continental Automotive Systems US Inc., the Michigan-based maker of air-bag systems used in the defective GM cars. The request for a so-called park-it order was made by the owners of a 2006 Chevrolet Cobalt who sued GM for the lost value of their car, the report related. They said the order was the only "fail- safe solution" until defects in the Cobalt and other small-car models linked to 13 deaths are fixed. The judge said she denied the plaintiffs' request in part because they didn't need the order to advance their lawsuit against GM. "GM pushed to win this hearing on a technicality," said Bob Hilliard, a Corpus Christi-based lawyer for the plaintiffs, the report further related. "There's no doubt had they agreed with me and done this voluntarily, lives would have been saved." Kevin Kelly, a spokesman for GM, said the company respects the court ruling, the report cited. 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. GILES-JORDAN: Section 341(a) Meeting Scheduled for June 2 --------------------------------------------------------- A meeting of creditors in the bankruptcy case of Giles-Jordan, Inc., will be held on June 2, 2014, at 1:30 p.m. at Houston, 515 Rusk Suite 3401. Creditors of the Debtor have until Sept. 2, 2014, to submit their proofs of claim. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This meeting of creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Giles-Jordan, Inc., filed a Chapter 11 bankruptcy petition in its hometown in Galveston, Texas (Bankr. S.D. Tex. Case No. 14-80173) on May 5, 2014. The Debtor disclosed $12 million in total assets and $4.81 million in liabilities, including $3.72 million of secured debt. Its lone asset is a 39.16-acre property at 230 East Beach Drive, in Galveston, Texas. Galveston Shores, LP, of Carlsbad, California, is the holder of the secured debt. The case is assigned to Judge Letitia Z. Paul. The Debtor is represented by Jeffrey Wells Oppel, Esq., at Oppel & Goldberg, PLLC, in Houston, Texas. GOLDEN LAND: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Golden Land LLC 136-40 39th Avenue, #202 142-23 37th Avenue, #2E Flushing, NY 11354 Case No.: 14-42315 Chapter 11 Petition Date: May 8, 2014 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Hon. Nancy Hershey Lord Debtor's Counsel: Xiangan Gong, Esq. XIANGAN GONG 136-40 39th Avenue, #202 Flushing, NY 11354 Tel: 718-569-2980 Fax: 718-888-1179 Email: xaglaw@gmail.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtor did not file a list of its largest unsecured creditors when it filed the petition. GREAT PLAINS: Aug. 11 Pre-Trial Conference on Bank's Motion ----------------------------------------------------------- The Bankruptcy Court, according to Great Plains Exploration LLC's case docket, will convene a final pre-trial conference on Aug. 11, 2014, at 11:00 a.m., to consider the motion for relief from stay filed by creditor 1st Source Bank. The Court also ordered that 1. discovery is due by June 9; 2. all preliminary motions including motions for summary judgment must be filed by June 23; 3. the movants' portion of the pretrial statement will be finalized and served on all parties with a copy filed with the Court by June 23; 4. the respondents' portion of the pretrial statement will be finalized and served on all parties with a copy filed with the Court on July 7; 5. on July 21, the movants will file with the Court the completed and consolidated pretrial statement signed by all parties. Failure by any party to timely comply with any terms of the order will result in the imposition of sanctions on that party by, inter alia, reprimand, fine, prohibition against said party from offering testimony or dismissal. On April 22, the Court: i) approved the settlement agreement dated March 17, 2014, as amended April 17, 2014, among the Debtors, Richard M. Osborne, and the Richard M. Osborne Trust, RBS Citizens, N.A. dba Charter One, and Nathan Properties, LLC, Wilson Land Properties, LLC, Osair, Inc., Black Bear Realty, LLC, Checkers of Ohio, Heisley Hopkins, Inc., Leimco Development Co., Ltd., Route 306, LLC, Tyler Boulevard, LLC, Retirement Management Company, Bedford Properties, LTD., Liberty Self Stor II, Ltd., 8014 Bellflower Road LLC, Route 44, LLC, Oz Acquisition, LLC, 7621 Mentor Avenue, LLC, and John D. Oil and Gas Marketing Company, LLC; ii) stayed the appointment of a Chapter 11 trustee indefinitely, pending further order of Court or the operation of the settlement agreements adversary proceeding No. 14-01024-TOA is dismissed and the claims raise releases; and iii) dismissed the adversary proceeding No. 14-01024-TPA, and the claims raised are released, contingent on the Debtor fully performing the settlement agreement. Additionally, the Court also ordered that: -- unless a Chapter 11 trustee is appointed by June 8, the Debtor must file a Fourth Amended Plan, Fourth Amended Disclosure Statement and Fourth Amended Plan Summary; and -- unless a Chapter 11 Trustee is appointed by Oct. 30, 2014, the Debtor must file a statement representing that an escrow has been established sufficient to fund the minimum payment to unsecured creditors as set forth in the settlement agreement. As reported in the Troubled Company Reporter, the Bank on March 20, 2014, sought relief from automatic stay to sell certain personal property collateral, claiming that the Debtor is not able to provide adequate protection to the Bank. The Bank and Debtor executed and entered on May 21, 2007, into a loan and security agreement whereby the Bank agreed to extend credit to the Debtor for purposes of the Debtor acquiring or purchasing certain vehicles, equipment and machinery, which are items constituting the collateral. The Debtor agreed to grant a security interest in the collateral as security for the extension of credit. The Debtor has defaulted in the monthly payments to the Bank. The regular monthly payment due is $26,886.02. As of March 9, 2014, the payoff of the amount due and owing the Bank by the Debtor is $596,384.74. Interest continues to accrue on the principal amount at the rate of $95.90 per day. The Bank believes that the value of the collateral does not provide adequate protection to the Bank considering the depreciating value of the collateral, additional costs to the Bank of continuing interest and late charges, and additional amounts accruing related to attorneys' fees and court costs. The collateral is believed to be in the possession of Debtor. On April 7, 2014, the Debtor filed a response to the Bank's motion, asking the Court to deny the motion. According to the Debtor, the Bank attempts to impermissibly inflate its claim so as to cause the appearance of a lack of security. The Bank asserts that the payoff for its loans to Debtor is now $596,384.74. The Debtor says in its April 7 court filing that in formulating this calculation, the Bank includes such items as interest, late fees, legal fees and non legal expenses totaling $214,800.95. The Debtor disputes the amount and the permissibility of these charges under the Bankruptcy Code. The Bank's new calculation also ignores that fact that the parties agreed that the amount of the claim is $484,731.14 and cannot be amended, the Debtor states. The Court approved this agreement on Nov. 6, 2013. The Bank is represented by: Kurt L. Sundberg, Esq. MARSH SPAEDER BAUR SPAEDER & SCHAAF, LLP 300 State Street, Suite 300 Erie, PA 16507 Tel: (814) 456-5301 E-mail: ksundberg@marshspaeder.com About John D. Oil & Gas; OZ Gas; and Great Plains Exploration Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. GREAT PLAINS: Has Access to Cash Collateral Until Sept. 30 ---------------------------------------------------------- The Bankruptcy Court, in a first amended final order, authorized Oz Gas LTD; Great Plains Exploration LLC; John D Oil and Gas Company's to use cash collateral until Sept. 30, 2014. Pursuant to a settlement agreement, the Debtors and prepetition secured lender -- RBS Citizens, N.A. doing business as Charter One -- agreed to each Debtor's use of cash collateral on certain terms and condition and pursuant to the budget. The settlement agreement contemplates and requires that the Debtor file the motion and obtain entry of the instant order approving the terms and conditions of the Debtor's use of cash collateral. As reported in the Troubled Company Reporter on April 25, 2014, Roberta A. DeAngelis, the U.S. Trustee for Region 3, objected to the Debtors' motion especially to the inclusion of any provisions in the amended final court order authorizing the use of cash collateral which restrict the Chapter 11 trustee's independent performance of his or her fiduciary duties, including those which require the trustee to sell assets and those which limit the trustee's exclusive control of the Debtors' businesses. On March 19, 2014, the Debtors filed their motions to amend the final cash collateral, saying that they have reached an agreement with RBS Citizens Bank, "which not only facilitates the payment of RBS, but also permits the Debtor the opportunity to continue its business and work to effectuate a plan of reorganization." The Debtors said they can continue to provide adequate protection to RBS for the use of cash collateral. As reported in the TCR on April 21, 2014, RBS consented to the proposed amended final order. About John D. Oil & Gas; OZ Gas; and Great Plains Exploration Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. GREAT PLAINS: Has Until June 8 to Submit Fourth Amended Plan ------------------------------------------------------------ The Bankruptcy Court, according to Great Plains Exploration LLC's case docket, directed the Debtor to submit by June 8, 2014, a Fourth Amended Chapter 11 Plan, Disclosure Statement, and updated deadlines. Great Plains filed the Third Amended Plan and Disclosure Statement on Dec. 2, 2013. A summary and outline of the Plan as well as objections to the Plan were reported by the Troubled Company Reporter on Feb. 3, 2014. Pursuant to the Plan, Great Plains intends to pursue a private sale of its assets after which it will engage in new business ventures alone or in combination with other entities related to Richard M. Osborne, its 100% owner. Great Plains expects to be substantially debt-free and out of bankruptcy. Under the Plan, holders of General Unsecured Claims against the Debtor will receive 50% of the Allowed Amount, paid within 30 days of the closing of the Private Sale. Holders of Class 4 Claims against the Debtor that are insiders or related-entities will not receive any distribution on account of their Allowed Claim until such time as other Class 4 creditors have been paid pursuant to the terms of the plan. Holders of Equity Interest owners will retain their interests in the Debtor. A copy of the Third Amended Disclosure Statement is available at: http://bankrupt.com/misc/GREATPLAINSds3plan.pdf Objections to the Plan were filed by The State of Ohio, Department of Taxation, State of Ohio, Bureau of Workers' Compensation, State of Ohio Environmental Protection Agency, and State of Ohio Department of Job and Family Services; and 1st Source Bank. About John D. Oil & Gas; OZ Gas; and Great Plains Exploration Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. GSE ENVIRONMENTAL: Moody's Lowers PDR to 'D-Pd' Over Bankruptcy --------------------------------------------------------------- Moody's Investors Service, lowered GSE Environmental's probability of default rating to D-PD from Caa3-PD following the company's bankruptcy filing on May 5, 2014. Moody's affirmed the Caa2 corporate family, Caa2 first lien term loan and revolver, and SGL- 4 ratings. Moody's plans to withdraw all GSE ratings by May 15th, consistent with the policy for companies operating under bankruptcy protection. Please refer to Moody's Withdrawal Policy on moodys.com. Downgrades: Issuer: GSE Environmental, Inc. Probability of Default Rating, Downgraded to D-PD from Caa3-PD Outlook Actions: Issuer: GSE Environmental, Inc. Outlook, Remains Negative Affirmations: Issuer: GSE Environmental, Inc. Speculative Grade Liquidity Rating, Affirmed SGL-4 Corporate Family Rating, Affirmed Caa2 Senior Secured Bank Credit Facility May 27, 2016, Affirmed Caa2 Senior Secured Bank Credit Facility May 27, 2016, Affirmed Caa2 Ratings Rationale The lowering of the probability of default rating to D-PD follows the May 5th, 2014 bankruptcy filing by GSE Holdings, Inc, its GSE Environmental subsidiary, and most domestic subsidiaries. The company's non-US subsidiaries were not included in the filing and continue to operate outside of bankruptcy. The company made this filing in the context of an agreement to reorganize its capital structure through eliminating debt. Per the filed plan, the first lien lenders are to receive 100% of the GSE equity. The company agreed to a $45 million debtor in possession facility to ensure operations continue through the bankruptcy process. GSE Environmental, Inc. (fka Gundle/SLT Environmental, Inc.) ("GSE"), based in Houston, TX, is a global manufacturer of geosynthetic lining products used in environmental protection and for the confinement of solids, liquids and gases in the waste management, liquid containment and mining industries. GSE markets its products and installation services through internal and third- party distribution channels. Revenues for the last twelve months ended December 31, 2013 were just under $420 million. GTP ACQUISITION: Fitch Affirms BB- Rating on Class 2011-2F Notes ---------------------------------------------------------------- Fitch Ratings has affirmed GTP Acquisition Partners I, LLC Secured Tower Revenue Notes, Global Tower Series 2011-2C, 2011-2F, 2013- 1C, and 2013-1F as follows: -- $490,000,000 class 2011-2C at 'Asf'; Outlook Stable; -- $155,000,000 class 2011-2F at 'BB-sf'; Outlook Stable; -- $190,000,000 class 2013-1C at 'Asf'; Outlook Stable; -- $55,000,000 class 2013-1F at 'BB-sf'; Outlook Stable; Key Rating Drivers The affirmations are due to the stable performance of the collateral since issuance with no significant changes to the collateral composition. The Stable Outlooks reflect the limited prospect for upgrades given the provision to issue additional notes. Rating Sensitivities The classes are expected to remain stable based on continued cash flow growth due to annual rent escalations and automatic renewal clauses resulting in higher debt service coverage ratios since issuance. The ratings have been capped at 'A' due to the specialized nature of the collateral and the potential for changes in technology to affect long-term demand for wireless tower space. All of the notes are backed by mortgages representing more than 93% of the annualized run rate net cash flow (NCF) and guaranteed by the direct parent of the borrowers. Those guarantees are secured by a pledge and first-priority-perfected security interest in 100% of the equity interest of the borrowers (which own or lease 2,907 wireless communication sites) and of the direct parent, respectively. The non-rated 2011-1C class with a balance of $70 million has the same rating and is pari passu with classes 2011-2C and 2013-1C. Additionally, 2011-2F and 2013-1F have the same rating and are pari passu in terms of losses with each other. As part of its review, Fitch analyzed the collateral data and site information provided by the master servicer, Midland Loan Services. As of the March 2014 remittance, aggregate annualized run rate net cash flow increased 6.2% since issuance to $123 million. The Fitch stressed DSCR increased from 1.26x at issuance to 1.30x as a result of the increase in net cash flow. The technology type concentration is stable. As of March 2014, total revenue contributed by telephony tenants was 96.1% which is an increase from 90.6% at issuance. Lease revenues from telephony tenants have more stable income characteristics than other tenant types due to the strong end-use customer demand for wireless services. American Tower Corporation, rated 'BBB' by Fitch, acquired 100% of the outstanding common membership interests of MIP Tower Holdings LLC, a private real estate investment trust, which is the parent company of Global Tower Partners (GTP) and assumed the existing GTP debt in October 2013. GUISEPPE FILIPPINI: Case Summary & 2 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Guiseppe Filippini, Inc. aka Giuseppe Filippini, Inc. 811 Shelbourne Road Reading, PA 19606 Case No.: 14-13737 Chapter 11 Petition Date: May 8, 2014 Court: United States Bankruptcy Court Eastern District of Pennsylvania (Reading) Judge: Hon. Richard E. Fehling Debtor's Counsel: John A. Digiamberardino, Esq. CASE, DIGIAMBERARDINO & LUTZ, PC 845 North Park Road, Suite 101 Wyomissing, PA 19610 Tel: 610-372-9900 Fax: 610-372-5469 Email: jad@cdllawoffice.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Enrico Filippini, president. A list of the Debtor's two largest unsecured creditors is available for free at http://bankrupt.com/misc/paeb14-13737.pdf HOME SAVINGS: FDIC Trumps Jackson Walker In Row Over Legal Fees --------------------------------------------------------------- Law360 reported that a Minnesota federal judge found that Jackson Walker LLP must return to the Federal Insurance Deposit Corp. the remaining amount on a retainer paid by a Minnesota-based bank that collapsed after it tried to convert to a Texas state savings bank. According to the report, U.S. District Judge Ann D. Montgomery rejected the law firm's contention that it had a security interest in a $100,000 retainer fee that it held in a trust for Home Savings of America before it was taken over by the FDIC. The case is Jackson Walker L.L.P. v. Federal Deposit Insurance Corp., Case No. 0:12-cv-02839 (D. Minn.). HOYT TRANSPORTATION: NY School Bus Operator Back in Business ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Hoyt Transportation Corp., a New York City school-bus operator, got itself back in business by buying 208 routes from similarly bankrupt Atlantic Express Transportation Corp., which had been the fourth-largest school-bus operator in the U.S. According to the report, the purchase last year got Hoyt back in operation. It went out of business in June when the contract with the city school system expired. Bankruptcy ensued the next month. Hoyt and other school bus operators with union contracts were unable to make competitive bids when the city changed its policy and in substance no longer required adherence with union contracts, the report related. Hoyt, like some other operators, negotiated a new contract with the union to enable buying the Atlantic Express routes and competitive pricing, the report further related. Hoyt has filed papers for court approval of the new collective bargaining agreement. The new contract virtually eliminates a $2.2 million back-pay claim because the union is dropping a freeze it placed on receivables from the city school, the report said. That makes about $2.1 million available to cover back pay. About Hoyt Transportation Brooklyn, New York-based Hoyt Transportation Corp. filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 13-44299) on July 13, 2013, estimating at least $10 million in assets and liabilities. The Debtor is represented by Kevin J. Nash, Esq., at Goldberg Weprin Finkel Goldstein LLP. Brooklyn-based Hoyt specializes in transportation for children with disabilities. Hoyt operated 350 buses until the contract with the Department of Education expired. INDU CRAFT: Untimely Appeal to Circuit Court Isn't Jurisdictional ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that an untimely bankruptcy appeal from a U.S. district court to a circuit court isn't jurisdictional, according to an April 10 opinion by the U.S. Court of Appeals in New York. If the opposing party doesn't raise the issue of untimeliness, the objection is waived and the circuit court can hear the appeal, Judge Debra Ann Livingston wrote for a three-judge panel of the U.S. Court of Appeals for the Second Circuit, according to the report. In legal parlance, a jurisdictional issue is one that goes to the ability of a court to hear a matter, the report related. If there's no jurisdiction, a federal court can't entertain a dispute. With appeals, some procedural mistakes can be deemed jurisdictional, barring the appellate court from taking a case even it wants to, the report further related. Judge Livingston's panel was called on to decide whether the timing mistake was jurisdictional. The case came to the circuit court after an unsuccessful appeal from a ruling in bankruptcy court, the report added. The losing party filed a motion for rehearing in district court beyond the 14 days allowed by Rule 8015 of the Federal Rules of Bankruptcy Procedure. The case is Tze Wung Consultants Ltd. v. Bank of Baroda (In re Indu Craft Inc.), 12-3901 U.S. Court of Appeals for the Second Circuit (Manhattan). IOWA FINANCE: Fitch Affirms 'BB-' Rating on Revenue Bonds --------------------------------------------------------- Fitch Ratings has affirmed at 'BB-' the rating on the $1.185 billion of Midwestern Disaster Area Revenue Bonds issued by the Iowa Finance Key Rating Drivers Nitrogen Market Price Exposure: IFCo will sell its products to farmers, distributers, and blenders at market prices. The project's products have historically exhibited considerable price volatility as evidenced by the average five - and 10-year one standard deviation ranges of 25% - 30% and 35%, respectively. However, Fitch believes that IFCo will benefit from favorable pricing in the medium-term, but recognizes a shift in the supply- demand balance could negatively impact prices. Fitch forecasts that a 10% change in nitrogen product prices will result in a 0.40x - 0.50x change in DSCRs. Natural Gas Price Risk: The project will procure its natural gas feedstock via an existing pipeline at prices linked to Henry Hub. IFCo has entered into natural gas call swaptions for the first seven years of the project with a strike price of $6.00 and $6.50 per mmBtu to moderate gas price risk. In addition, the project will fund from operations, over seven years, an annual $25.8 million reserve requirement to provide liquidity and help mitigate price risk during the non-hedging period. Manageable Operating Risks: IFCo will utilize commercially proven technologies with relatively low maintenance risk. The independent engineer (IE) opined that the non-feedstock O&M and major maintenance costs were reasonable and forecasted technical operating performance was achievable. Further, Fitch believes that the project's oversized and flexible production capacity helps mitigate operating performance risk. Strong Completion Arrangement: The fixed-price, turn-key, date- certain, fully-wrapped engineering, procurement, and construction (EPC) agreement with an experienced contractor that has delivered similar projects on-schedule and on-budget substantially mitigates construction risk. Speculative-Grade Forecasted Financial Profile: The Fitch rating case forecasts average and minimum DSCRs of 1.19x and 1.08x, respectively. Fitch believes that the project exhibits an ability to endure a combination of financial and performance stresses, but views the exposure to margin risk as a rating constraint. While natural gas price exposure has been moderated, the nitrogen fertilizer price remains subject to the U.S. trade balance, cost of production, and changes in supply and demand. Rating Sensitivities Material increases in costs or delays during construction in excess of remaining contingency funding, or failure to reach and sustain projected capacity and utilization rates. A fundamental shift in the supply-demand balance that results in a materially different nitrogen market pricing environment than forecasted. Higher than expected natural gas market prices or an inability to effectively manage operating costs. Security First priority security interest in all tangible and intangible assets of the project and a pledge by Iowa Holding LLC of its membership interests in IFCo. Credit Update The rating affirmation is based upon the project's construction progress and the expectation that operational cash flow will be sufficient to repay outstanding debt obligations. After a harsh winter, the project is slightly off schedule, but is expected to meet the Aug. 15, 2015 mechanical completion date and the Nov. 15, 2015 provisional acceptance date. Overall costs remain in line with the budget and have been funded in line with the draw schedule. The engineering and procurement phases are on schedule, while the construction phase is slightly behind its timeline. The construction delay was due to harsh winter weather, in December and January, delaying the pouring of concrete for the Outside Battery Limit (OSBL). This caused the construction phase to be delayed by several weeks. However, the IE visited the site at the end of April 2014 and stated that the contractor has made good progress towards making up the days. Overall EPC work is now 38% complete, and the IE expects the EPC contractor to catch up to the construction timeline and complete the project by the August 2015 deadline. Change orders have been manageable and are expected to be about $42 million, leaving about $63 million available in the contingency fund. The change orders were related to a layout shift to avoid disturbing a historical site, and additional pilings for the ISBL and OSBL areas. The IE has stated that the remaining contingency reserve will be sufficient to complete the project. IFCo has stated the importance of the project to the parent company and that it would use internal funds to complete the project in the event the contingency reserve was depleted. Fitch considers the credit quality of the EPC contractor to be below that of the project, but does not view this as a rating constraint. Fitch believes that the structural features of the EPC contract and financing agreements, use of conventional technology, availability of substitute contractors, favorable IE opinion regarding construction costs, and potential for supplemental sponsor support, albeit uncommitted, help mitigate counterparty risk. Once completed, IFCo will have up to 2.2 million short tons of flexible capacity to produce ammonia, urea, urea-ammonium nitrate (UAN), and diesel exhaust fluid (DEF). IFCo will sell its products at market prices that have historically exhibited considerable price volatility. As a result, Fitch continues to monitor current pricing to determine if revenue risk is properly contemplated. As of April 2014, pricing on ammonia, UAN, and DEF remain well within the range of prices utilized in Fitch's rating case analysis. IRI SABINO: Golf Course Name, Assets to Be Sold May 28 ------------------------------------------------------ Real and personal property of IRI Sabino Springs Golf Course LLC -- c/o The IRI Golf Group, L.L.C., headquartered at 11512 El Camino Real, Suite 120 San Diego, California 92130 -- will be sold at public auction on the steps outside the East entrance to the Courts Building, 110 West Congress, Tucson, Arizona, 85701, at 10 a.m., on May 28, 2014. Secured party Romspen Club Holdings, Inc., is seeking the sale of the property. It may be reached at: Romspen Club Holdings, Inc. 162 Cumberland Street, Suite 300 Toronto, Ontario, M5R 3N5 Romspen is represented by: Michael R. Scheurich, Esq. DICKINSON WRIGHT/MARISCAL WEEKS 2901 North Central Avenue, Ste. 200 Phoenix, AZ 85012 Tel: (602) 285-5011 The assets serve as collateral to debt owed to Romspen. The collateral does not include any items of equipment or personal property which are leased by the Debtor from third parties. The assets for sale include the right to use the name "Arizona National Golf Club". ITSA HARDWARE: Foreclosure Auction Set for June 4 ------------------------------------------------- The real property of ITSA Hardware Land, LLC, will sold at a public auction to the highest bidder at 1:00 p.m., June 4, 2014, at the front steps of the Gila County Superior Court, 1400 East Ash Street, Globe, Arizona 85501. Proceeds of the sale will be paid to National Consumer Cooperative Bank, d/b/a NCB, as Trustee, for the benefit of NCB, FSB, a federal savings bank, as Beneficiary, to pay down debt in the original principal balance of $1,012,500. The property consists of "All that certain piece or parcel of land situate and being a part of Lots 16 and 17 and all of Lots 18, 19, 20 and 21, Block 2, and a portion of Block 5, Skyline Drive." The asset is located at 1930 East Ash Street, Globe, Arizona 85501. The Trustee may be reached at: Anthony M. Grafitti BERRY RIDDELL & ROSENSTEEL LLC 6750 East Camelback Road, Suite 100 Scottsdale, AZ 85251 JBJAZ LLC: Villages At Queen Creek Lot to Be Sold May 28 -------------------------------------------------------- Property of JBJAZ, L.L.C. will be sold at public auction to the highest bidder, at the law offices of Quarles & Brady LLP in Phoenix, Arizona, on May 28, 2014 at 10:00 a.m. The assets consist of "Parcel No. 1 (Tract C) A Portion Of The Northwest Quarter Of Parcel 3, at The Villages At Queen Creek" as well as related improvements and fixtures. The assets to be sold are located at 22721 S. Ellsworth Road Queen Creek, AZ 85242, and serve as collateral to debt under a promissory note in the original principal balance of $1,900,000. A modified Deed of Trust has indicated, however, that debt under the Note is $2,050,000. The amount is owed to: Wells Fargo Bank, National Association c/o Hudson Americas, LLC Its Attorney-in-Fact 2711 North Haskell Ave., Suite 1800 Dallas, TX 75204 The sale will be made for cash or other form satisfactory to Quarles, which serves as Trustee. The current Trustee is: Jason D. Curry, Esq. QUARLES & BRADY LLP Renaissance One Two North Central Avenue Phoenix, AZ 85004-2391 Telephone: 602-229-5200 E-mail: elizabeth.hibbs@quarles.com JENKINS BROS: Liberty Mutual Can't Duck Asbestos Claims ------------------------------------------------------- Law360 reported that a New York appeals court affirmed a ruling refusing Liberty Mutual Insurance Co.'s attempt to dismiss asbestos injury suits against a now-dissolved New Jersey valve manufacturer, ruling that corporations that have been dissolved can still be sued under New Jersey law. According to the report, the panel of judges in New York's First Department ruled that the trial court properly ruled that Liberty Mutual could be the target of the plaintiffs' suits because plaintiffs were unable to locate representatives of Jenkins Bros., which was dissolved in 2004. KAWISH LLC: Case Summary & 4 Largest Unsecured Creditors -------------------------------------------------------- Debtor: Kawish LLC 1605 73rd Avenue NE Medina, WA 98039 Case No.: 14-13594 Chapter 11 Petition Date: May 8, 2014 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Hon. Marc Barreca Debtor's Counsel: Paul E Brain, Esq. BRAIN LAW FIRM PLLC 1119 Pacific Ave Ste 1200 Tacoma, WA 98402 Tel: 253-327-1019 Email: pbrain@paulbrainlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Timothy L. Blixseth, manager. A list of the Debtor's four largest unsecured creditors is available for free at http://bankrupt.com/misc/wawb14-13594.pdf KRATOS DEFENSE: Moody's Assigns B3 CFR & Rates $625MM Notes B3 -------------------------------------------------------------- Moody's Investors Service has affirmed ratings, including the B3 Corporate Family Rating, of Kratos Defense & Security Solutions, Inc. Concurrently, a B3 rating has been assigned to the company's planned $625 million secured notes due 2019. Proceeds of the new notes will fund the mandatory redemption of the existing $625 million secured notes due 2017. A new asset-based revolving credit facility ("ABL," unrated) is being arranged along with the debt raise. The continued stable rating outlook anticipates performance improvements in H2-2014, better interest coverage and covenant headroom that will accompany the notes and ABL. Ratings: Corporate Family, affirmed at B3 Probability of Default, affirmed at B3-PD $625 million senior secured notes assigned at B3, LGD 4, 54% $400 million senior secured notes affirmed at B3, LGD 4, 54% (to be withdrawn at transaction close) $225 million senior secured notes affirmed at B3, LGD 4, 54% (to be withdrawn at transaction close) Speculative Grade Liquidity, affirmed at SGL-3 Rating Outlook: Continued at Stable The rating outlook remains stable despite high financial leverage metrics for the rating since Moody's expect that leverage will decline to a more fitting level by year-end. The transaction should also reduce the annual interest burden, potentially by up to $15 million, contributing to stronger net profit and operational cash flow generation. But the transaction would raise the company's already high financial leverage metrics. At Q1-2014 Kratos' debt/EBITDA, excluding unamortized debt premium and on a Moody's adjusted basis, was 8.1x; the metric will rise to roughly 8.4x owing to the associated note redemption premium, which will necessitate $35 million of ABL borrowing at transaction close. Additionally, the company's earnings have suffered of late in part due to company-sponsored R&D spending on some unmanned aerial systems and several weapon system opportunities. A planned reduction of company-funded R&D spending in H2-2014, operational cost reductions recently undertaken, scheduled deliveries and seasonal working capital decline should permit repayment of most or all revolver borrowing by year-end. Debt/EBITDA at that point could descend by up to a full turn. The transaction also better ensures continued liquidity profile adequacy, which helps sustain the Speculative Grade Liquidity rating at SGL-3. Although headroom under the revolving credit facility's minimum fixed charge coverage maintenance test was minimal at Q1-2014, the planned ABL will have a slightly lower test threshold, important since some drawing will occur under the ABL to fund the transaction. (At Q1-2014 Kratos' borrowing based revolver availability, before letters of credit utilization, is $75 million compared to a $110 million commitment.) Affirmation of the B3 Corporate Family Rating considers debt/EBITDA below 7.5x by year-end and closer to 7x by mid 2015. The rating benefits from good defense product portfolio positioning, across satellite communications, unmanned aerial, and electronic warfare categories, as well as, continued growth within the company's commercially-focused Public Safety and Security Solutions segment. Historically low but positive free cash flow generation and potential that the transaction will ensure continued free cash flow also supports the rating. Steady backlog of late as well positively contributes to the rating. A rating downgrade would likely follow expectation of debt to EBITDA continued above 7.5x by early 2015, lack of free cash flow or weak liquidity. A positive outlook or higher rating is unlikely at this time but would require an expectation of debt to EBITDA sustained in the mid 5x range with EBIT to interest approaching 1.5x. Kratos Defense & Solutions, Inc., headquartered in San Diego, CA, operates in two sectors: Government Solutions (78% of 2013 revenues) and Public Safety and Security (22%). Revenue for the twelve months ending March 31, 2014 was $898 million. LEGACY RESERVES: S&P Raises CCR to 'B+' on Acquisition ------------------------------------------------------ Standard & Poor's Ratings Services raised its corporate credit rating on Midland, Texas-based oil and gas exploration and production company Legacy Reserves L.P. to 'B+' from 'B'. The outlook is stable. S&P also raised the rating on the company's unsecured notes to 'B' from 'B-'. The recovery rating on this debt is '5', reflecting S&P's expectation for modest (10% to 30%) recovery in the event of a payment default. The company is acquiring a non-operated working interest from WPX Energy Inc. in the Piceance Basin for $355 million along with newly created incentive distribution units. In conjunction with this acquisition, Legacy will tack on $250 million to its existing $250 million 6.625% unsecured notes due 2021. This brings the total issue amount on these notes to $500 million. The outlook is stable because Standard & Poor's does not expect to raise or lower the rating on Legacy during the next 12 months. S&P expects the company will fund its acquisitions prudently such that debt generally does not exceed 50% of the acquisition cost. S&P also expects the company will hedge a majority of its future production for a multiyear period. If this occurs, S&P expects run rate debt to EBITDA of 3.5x to 4x, which it considers to be appropriate for the current rating. S&P could lower the rating if it believes that run rate debt to EBITDA leverage will breach 4.25x. This scenario could occur if Legacy funds its acquisitions such that debt represents more than 50% of the acquisition cost and if production fails to meet S&P's expectations. S&P considers an upgrade unlikely based on its assessment of the business risk profile, including the company's modest internal growth prospects. LIVE CELL ASSAYS: Case Summary & 6 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Live Cell Assays, LLC 2326 New Lake Pl Martinez, CA 94553 Case No.: 14-42044 Chapter 11 Petition Date: May 9, 2014 Court: United States Bankruptcy Court Northern District of California (Oakland) Judge: Hon. William J. Lafferty Debtor's Counsel: R. Kenneth Bauer, Esq. LAW OFFICES OF R. KENNETH BAUER 500 Ygnacio Valley Rd. #328 Walnut Creek, CA 94596 Tel: (925) 945-7945 Email: rkbauerlaw@gmail.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $100,000 to $500,000 The petition was signed by Daniel E. Callahan, president/manager. A list of the Debtor's six largest unsecured creditors is available for free at http://bankrupt.com/misc/canb14-42044.pdf LUNDY'S MANAGEMENT: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Lundy's Management Corp. 540 Atlantic Avenue, Fifth floor Brooklyn, NY 11217 Case No.: 14-42318 Chapter 11 Petition Date: May 8, 2014 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Hon. Elizabeth S. Stong Debtor's Counsel: Ralph E Preite, Esq. SICHENZIA ROSS FRIEDMAN FERENCE LLP 61 Broadway, 32nd floor New York, NY 10006 Tel: (646) 885-6531 Fax: (212) 930-9725 Email: rpreite@srff.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Steve Pappas, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. LYONDELL CHEMICAL: Lender Can't Sue Over Loan Syndicate Exclusion ----------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Highland Capital Management LP, a Dallas-based hedge fund, can't sue UBS Securities LLC for being excluded from a $1 billion syndicated loan in the Lyondell Chemical Co. bankruptcy, according to a federal district judge in New York. According to the report, Highland had been one of the lenders to chemical producer Lyondell, with $200 million in claims across its capital structure. Lyondell exited Chapter 11 reorganization in April 2010 with help from the syndicated loan, the report related. A month earlier, after receiving confidential materials about participating in the syndicate, Highland sent UBS Securities, the lead arranger, a commitment to provide $150 million of the exit loan. When the syndicate members were announced at the end of March 2010, Highland wasn't included, the report further related. By July 2010, it had started lawsuits against Lyondell and UBS in state court. After a state court suit against Lyondell was moved to bankruptcy court and dismissed, Highland sued Stamford, Connecticut-based UBS Securities, a unit of UBS AG, in bankruptcy court in April 2011, alleging unlawful interference with contract and prospective economic relations, the report said. U.S. Bankruptcy Judge Robert Gerber dismissed the suit two years later, and that ruling was upheld by U.S. District Judge Analisa Torres in Manhattan, who noted in her Jan. 31 opinion that Highland had sued UBS several times before, the report added. The appeal is Highland Capital Management LP v. UBS Securities LLC (In re Lyondell Chemical Co), 13-cv-03654, U.S. District Court, Southern District of New York (Manhattan). About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. Luxembourg-based Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. Len Blavatnik's Access Industries owned the Company prior to its bankruptcy filing. On Jan. 6, 2009, LyondellBasell Industries' U.S. operations, led by Lyondell Chemical Co., and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities filed for Chapter 11. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 protection on April 24, 2009. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, served as the Debtors' bankruptcy counsel. Evercore Partners served as financial advisors, and Alix Partners and its subsidiary AP Services LLC, served as restructuring advisors. AlixPartners' Kevin M. McShea acted as the Debtors' Chief Restructuring Officer. Clifford Chance LLP served as restructuring advisors to the European entities. LyondellBasell emerged from Chapter 11 bankruptcy protection in May 2010, with a plan that provides the Company with US$3 billion of opening liquidity. A new parent company, LyondellBasell Industries N.V., incorporated in the Netherlands, is the successor of the former parent company, LyondellBasell Industries AF S.C.A., a Luxembourg company that is no longer part of LyondellBasell. LyondellBasell Industries N.V. owns and operates substantially the same businesses as the previous parent company, including subsidiaries that were not involved in the bankruptcy cases. LyondellBasell's corporate seat is Rotterdam, Netherlands, with administrative offices in Houston and Rotterdam. MARTIFER SOLAR: Plans to Auction Business by Mid-June ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Martifer Aurora Solar LLC, a builder of solar power projects, filed a Chapter 11 petition in January in Las Vegas and intends to emerge from reorganization by mid-July by selling the business. According to the report, the Los Angeles-based company said it hopes to have a so-called stalking-horse bidder signed to a contract in time for an auction in mid-June. About Martifer Solar Martifer Solar USA, Inc., and Martifer Aurora Solar LLC filed separate Chapter 11 bankruptcy petitions (Bankr. D. Nev. Case Nos. 14-10357 and 14-10355) in Las Vegas on Jan. 21, 2014. Martifer Solar USA, which is based in Los Angeles, California, estimated $10 million to $50 million in assets and liabilities. Bankruptcy Judge August B. Landis oversees the case. The Debtors tapped Brett A. Axelrod, Esq., and Micaela Rustia Moore, Esq., at Fox Rothschild LLP, in Las Vegas, as counsel, and Armory Consulting Co. as restructuring and financial advisor. The Debtors tapped Foley Hoag LLP as special Massachusetts litigation counsel with respect to a pending litigation relating to EPG Solar, LLC; and Foley & Lardner LLP as special solar counsel. Cathay Bank, a prepetition lender, is represented by Michael Gerard Fletcher, Esq., and Reed S. Waddell, Esq., at Frandzel Robins Bloom & Csato, L.C.; and Natalie M. Cox, Esq., and Randolph L. Howard, Esq., at Kolesar & Leatham. Martifer Solar Inc., the proposed DIP Lender, and ultimate parent of the Debtors, is represented by Samuel A. Schwartz, Esq., and Bryan A. Lindsey, Esq., at The Schwartz Law Firm Inc. Tracy Hope Davis, the U.S. Trustee for Region 17, appointed five creditors to serve on the Official Committee of Unsecured Creditors for the Chapter 11 bankruptcy case of Martifer Solar USA Inc. MARTIN BELZ: Peabody Hotel Chairman Confirms Chapter 11 Plan ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Martin S. Belz, president and chairman of Peabody Hotel Group, is on the cusp of emerging from his individual Chapter 11 reorganization after the bankruptcy judge at a hearing said he will sign a confirmation order approving the plan. According to the report, Belz entered bankruptcy in late December in his Memphis, Tennessee, hometown because a creditor attached securities accounts. The plan he proposed was almost unanimously accepted by creditors whose claims he said totaled $84.7 million, the report related. Belz, a hotelier and real-estate developer, listed assets worth $58.9 million in disclosure material explaining the plan, the report further related. Guarantees that are only contingent will remain in place, because there hasn't been a default to bring on his individual liability, the report added. Creditors with guarantees already in default will receive 40 percent of their claims in cash. The case is In re Martin S. Belz, 13-bk-33888, U.S. Bankruptcy Court, Western District of Tennessee (Memphis). MEOJ LLC: RepublicBankAz to Conduct Foreclosure Sale May 28 ----------------------------------------------------------- Real and personal property of MEOJ, LLC, will be sold at public auction to the highest bidder at the offices of Kutak Rock LLP in Scottsdale, Arizona, on May 28, 2014, at 11:00 am. The assets are located at 20505 South Old Adobe Lane (also known as 20505 South Old U.S. Highway 80), Arlington, Arizona 85322, and serve as collateral to debt owed in the original principal balance of $579,375 to: RepublicBankAz, N.A. 909 E. Missouri Ave. Phoenix, AZ 85014 MEOJ, LLC, is located at 25550 West U.S. Highway 85, Buckeye, Arizona 85326 The current trustee may be reached at: Allison H. Swenson, Esq. KUTAK ROCK LLP 8601 N. Scottsdale Road, Suite 300 Scottsdale, AZ 85253 Tel: 480-429-5000 MF GLOBAL: J.C. Flowers Defeats Sapere's Lawsuit ------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that J.C. Flowers & Co. was the primary beneficiary of an opinion by U.S. District Judge Victor Marrero winnowing away part of a lawsuit against Jon Corzine and other former officers and directors of MF Global Inc., the commodity brokerage liquidated in bankruptcy after mishandling $1.6 billion in customer funds. On April 16, Judge Marrero dismissed every claim that Sapere Wealth Management LLC attempted to bring against Flowers, a New York-based private-equity investor. Marrero, in Manhattan federal court, said that Matthews, North Carolina-based Sapere stated no facts to show that Flowers could be either directly or vicariously liable for Corzine's misdeeds. Judge Marrero did give Flower three weeks to file an amended complaint to fill the gaps pointed out in the judge's 35-page decision pinpointing insufficiencies in Sapere's complaint, the report related. Judge Marrero was designated to handle multiple civil suits against MF Global executives like Corzine, a former U.S. senator and New Jersey governor and onetime co-chairman of Goldman Sachs Group Inc., the report further related. In four previous lengthy opinions since November, Judge Marrero allowed the larger part of lawsuits to proceed on behalf of MF Global customers. Sapere was one customer that filed its own suit. Sapere contended that Flowers, an investor in MF Global, should be liable because it negligently selected or controlled Corzine by persuading him to lead the commodity broker, the report added. The lawsuit is In re MF Global Holdings Ltd. Securities Litigation, 11-cv-07866, U.S. District Court, Southern District of New York (Manhattan). About MF Global New York-based MF Global -- http://www.mfglobal.com/-- was one of the world's leading brokers of commodities and listed derivatives. MF Global provides access to more than 70 exchanges around the world. The firm also was one of 22 primary dealers authorized to trade U.S. government securities with the Federal Reserve Bank of New York. MF Global's roots go back nearly 230 years to a sugar brokerage on the banks of the Thames River in London. On Oct. 31, 2011, MF Global Holdings Ltd. and MF Global Finance USA Inc. filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15059 and 11-5058), after a planned sale to Interactive Brokers Group collapsed. As of Sept. 30, 2011, MF Global had $41,046,594,000 in total assets and $39,683,915,000 in total liabilities. On Nov. 7, 2011, the United States Trustee appointed the statutory creditors' committee in the Debtors' cases. At the behest of the Statutory Creditor's Committee, the Court directed the U.S. Trustee to appoint a chapter 11 trustee. On Nov. 28, 2011, the Bankruptcy Court entered an order approving the appointment of Louis J. Freeh, Esq., of Freeh Group International Solutions, LLC, as Chapter 11 trustee. On Dec. 19, 2011, MF Global Capital LLC, MF Global Market Services LLC and MF Global FX Clear LLC filed voluntary Chapter 11 petitions (Bankr. S.D.N.Y. Case Nos. 11-15808, 11-15809 and 11-15810). On Dec. 27, the Court entered an order installing Mr. Freeh as Chapter 11 Trustee of the New Debtors. On March 2, 2012, MF Global Holdings USA Inc. filed a voluntary Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-10863), and Mr. Freeh also was installed as its Chapter 11 Trustee. Judge Honorable Martin Glenn presides over the Chapter 11 case. J. Gregory Milmoe, Esq., Kenneth S. Ziman, Esq., and J. Eric Ivester, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, serve as bankruptcy counsel. The Garden City Group, Inc., serves as claims and noticing agent. The petition was signed by Bradley I. Abelow, Executive Vice President and Chief Executive Officer of MF Global Finance USA Inc. The Chapter 11 Trustee has tapped (i) Freeh Sporkin & Sullivan LLP, as investigative counsel; (ii) FTI Consulting Inc., as restructuring advisors; (iii) Morrison & Foerster LLP, as bankruptcy counsel; and (iv) Pepper Hamilton as special counsel. The Official Committee of Unsecured Creditors has retained Capstone Advisory Group LLC as financial advisor, while lawyers at Proskauer Rose LLP serve as counsel. The Securities Investor Protection Corporation commenced liquidation proceedings against MF Global Inc. to protect customers. James W. Giddens was appointed as trustee pursuant to the Securities Investor Protection Act. He is a partner at Hughes Hubbard & Reed LLP in New York. Jon Corzine, the former New Jersey governor and co-CEO of Goldman Sachs Group Inc., stepped down as chairman and chief executive officer of MF Global just days after the bankruptcy filing. In April 2013, the Bankruptcy Court approved MF Global Holdings' plan to liquidate its assets. Bloomberg News reported that the court-approved disclosure statement initially told creditors with $1.134 billion in unsecured claims against the parent holding company why they could expect a recovery of 13.4% to 39.1% from the plan. As a consequence of a settlement with JPMorgan, supplemental materials informed unsecured creditors their recovery was reduced to the range of 11.4% to 34.4%. Bank lenders will have the same recovery on their $1.174 billion claim against the holding company. As a consequence of the settlement, the predicted recovery became 18% to 41.5% for holders of $1.19 billion in unsecured claims against the finance subsidiary, one of the companies under the umbrella of the holding company trustee. Previously, the predicted recovery was 14.7% to 34% on bank lenders' claims against the finance subsidiary. MICHIGAN PRODUCE: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Michigan Produce Haulers, Inc. 1340 Locust Street Fremont, MI 49412 Case No.: 14-03188 Chapter 11 Petition Date: May 5, 2014 Court: United States Bankruptcy Court Western District of Michigan (Grand Rapids) Judge: Hon. James D. Gregg Debtor's Counsel: Cody H. Knight, Esq. RAYMAN & KNIGHT 141 East Michigan Ave, Ste 301 Kalamazoo, MI 49007 Tel: (269) 345-5156 Email: courtmail@raymanstone.com - and - Steven L. Rayman, Esq. RAYMAN & KNIGHT 141 E Michigan Avenue, Ste 301 Kalamazoo, MI 49007 Tel: (269) 345-5156 Email: courtmail@raymanstone.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Karla S. Gilliland, treasurer. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/miwb14-03188.pdf MO'TREES LLC: Case Summary & 10 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: MO'TREES, LLC 380 Lurton Street Pensacola, FL 32505 Case No.: 14-30496 Chapter 11 Petition Date: May 6, 2014 Court: United States Bankruptcy Court Northern District of Florida (Pensacola) Judge: Hon. William S. Shulman Debtor's Counsel: Cameron A. Metcalf, Esq. ESPY, METCALF & POSTON, P.C. P. O. Drawer 6504 Dothan, AL 36302-6504 Tel: (334) 793-6288 Fax: (334) 712-1617 Email: cam@emppc.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $10 million to $50 million The petition was signed by James C. Moulton, managing member. A list of the Debtor's 10 largest unsecured creditors is available for free at http://bankrupt.com/misc/flnb14-30496.pdf MOMENTIVE PERFORMANCE: DIP Lenders Agree to Lower LIBOR Rate ------------------------------------------------------------ Momentive Performance Materials Inc., on May 5, 2014, entered into the First Amendment, among the Company, Momentive Performance Materials Holdings Inc., Momentive Performance Materials USA Inc., the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent for the lenders under the Senior Secured Debtor-in-Possession Term Loan Credit Agreement, dated as of April 15, 2014. The Amendment became effective on May 5 and modifies the DIP Term Loan Facility by, among other things, (a) decreasing the LIBOR floor to 0.75%, (b) decreasing the applicable margin for the adjusted LIBOR rate to 3.25% and (c) decreasing the applicable margin for the alternate base rate to 2.25%. A copy of the First Amendment, dated as of May 5, 2014, among Momentive Performance Materials Holdings Inc., Momentive Performance Materials Inc., Momentive Performance Materials USA Inc., the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent for the lenders, under the Senior Secured Debtor-in-Possession Term Loan Credit Agreement, dated as of April 15, 2014, is available at http://is.gd/FdRQlzfrom Leagle.com. About Momentive Performance Momentive Performance is one of the world's largest producers of silicones and silicone derivatives, and is a global leader in the development and manufacture of products derived from quartz and specialty ceramics. Momentive has a 70-year history, with its origins as the Advanced Materials business of General Electric Company. In 2006, investment funds affiliated with Apollo Global Management, LLC, acquired the company from GE. As of Dec. 31, 2013, the Company had 4,500 employees worldwide, of which 46% of the Company's employees are members of a labor union or are represented by workers' councils that have collective bargaining agreements. Momentive Performance Materials Inc., Momentive Performance Materials Holdings Inc., and their affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 14-22503) on April 14, 2014, with a deal with noteholders on a balance-sheet restructuring. As of Dec. 31, 2013, the Debtors had $4.114 billion of consolidated outstanding indebtedness, including payments due within the next 12 months and short-term borrowings. The Debtors said that the restructuring will eliminate $3 billion in debt. The Debtors have tapped Willkie Farr & Gallagher LLP as bankruptcy counsel with regard to the filing and prosecution of these chapter 11 cases; Sidley Austin LLP as special litigation counsel; Moelis & Company LLC as financial advisor and investment banker; AlixPartners, LLP as restructuring advisor; PricewaterhouseCoopers as auditor; and Crowe Horwath LLP as benefit plan auditor. Kurtzman Carson Consultants LLC is the notice and claims agent. The U.S. Trustee for Region 2 appointed seven members to serve on the Official Committee of Unsecured Creditors of MPM Silicones LLC and affiliated debtors. MONTE DEI PASCHI: Seeks to Raise EUR5 Billion Cash Call ------------------------------------------------------- Giovanni Legorano, writing for Daily Bankruptcy Review, reported that the board of troubled Italian lender Banca Monte dei Paschi di Siena SpA decided to raise the amount of a coming share sale to EUR5 billion ($6.91 billion), from EUR3 billion previously planned. The bank said in a statement it has called a shareholders' meeting to approve the new amount of the capital increase on May 20. The Wall Street Journal reported on April 15 that Milan's FTSE Mib index closes 2.33% lower at 20817, among the worst of its peers. The biggest loser is Banca Monte dei Paschi di Siena which ends 10.4% lower after it emerged its management may seek to raise EUR5 billion in an upcoming cash call instead of EUR3 billion as previously planned, the Journal said. MT. GOX: Founder Won't Appear in U.S. for Questioning ----------------------------------------------------- Devika Krishna Kumar, writing for Reuters, reported that Mark Karpeles, the founder of Mt. Gox, said he would not come to the United States to answer questions about the Japanese bitcoin exchange's U.S. bankruptcy case, Mt. Gox lawyers told a federal judge. According to the report, in the court filing, Mt. Gox lawyers cited a subpoena from the U.S. Department of Treasury's Financial Crimes Enforcement Network, which has closely monitored virtual currencies like bitcoin. "Mr. Karpeles is now in the process of obtaining counsel to represent him with respect to the FinCEN Subpoena. Until such time as counsel is retained and has an opportunity to 'get up to speed' and advise Mr. Karpeles, he is not willing to travel to the U.S.", the filing said, the report related. The subpoena requires Karpeles to appear and provide testimony in Washington, D.C., the report further related. The court papers also said a Japanese court had been informed of the issue and that a hearing was scheduled in Japan, the report added. About Mt. Gox Bitcoin exchange MtGox Co., Ltd., filed a petition under Chapter 15 of the U.S. Bankruptcy Code on March 9, 2014, days after the company sought bankruptcy protection in Japan. The bankruptcy in Japan came after the bitcoin exchange lost 850,000 bitcoins valued at about $475 million "disappeared." The Japanese bitcoin exchange that halted trading in February 2014. It filed for bankruptcy protection in the U.S. to prevent customers from targeting the cash it holds in U.S. bank accounts. The Chapter 15 case is In re MtGox Co., Ltd., Case No. 14-31229 (Bankr. N.D. Tex.). The Chapter 15 Petitioner is Robert Marie Mark Karpeles, the company's chief executive officer. Mr. Karpeles is represented by John E. Mitchell, Esq., and David William Parham, Esq., at BAKER & MCCKENZIE LLP, in Dallas, Texas. The company said it has estimated assets of $10 million to $50 million and debts of $50 million to $100 million. MT. GOX: Liquidation "Bad Sign" for US Investors, Experts Say ------------------------------------------------------------- Law360 reported that now that a Japanese court has eliminated any chance of saving bitcoin operator Mt. Gox, experts say U.S. customers shouldn't get their hopes up for a substantial recovery or any concrete answers about its downfall from its chief executive. According to the report, the Tokyo District Court has decided that Mt. Gox will be liquidated, but because much of the bitcoin currency that went missing earlier this year is still unaccounted for, and with the company's CEO seemingly unlikely to appear in the U.S. for questioning, bankruptcy and bitcoin experts say it's going to be an ordeal for U.S. customers who lost money when the company went under. "Unfortunately many customers are outside of Japan, so it's very difficult with distance [and] language barriers to do that," Bruce Fenton of the Bitcoin Association, a nonprofit group aiming to educate the public on bitcoins, told Law360. MUNDY RANCH: May 13 Hearing on Adequacy of Plan Outline ------------------------------------------------------- The U.S. Bankruptcy Court will convene a hearing on May 13, 2014, at 9:00 a.m., to consider the adequacy of information in the Disclosure Statement explaining Mundy Ranch, Inc.'s Second Amended Plan of Reorganization dated on May 2, 2014. Objections, if any, were due May 9. According to the Disclosure Statement, the Plan proposed this treatment of claims: 1. Allowed Class 1 claims (administrative expenses) will be paid in full on or before the Effective Date. 2. Allowed Class 2 claims (priority) will be treated as: -- the claims of Internal Revenue Service will be paid in full over a period ending not later than five years after the date of the order for relief at four percent interest, if not paid earlier from the sale of the real property; -- the claims of New Mexico Taxation and revenue Department, if any, will be paid in full over a period ending not later than five years after the date of the order for relief at 4%, if not paid earlier from the sale of real property; -- claims of Rio Arriba County Treasurer, if any, will paid in full over a period ending not later than five years after the date of the order for relief at 4%, if not paid earlier from the sale of real property; and -- the priority claims of PBGC will be resolved by the Debtor voluntarily terminating the pension. 3. Allowed Class 3 (secured) claims will be treated as: -- Class 3A. The secured claim of Rabo AgriFinance was paid on Aug. 27, 2013, and Dec. 4, 2013 from the sale of the Debtor's real property. -- Class 3B. The secured claim of Valley National Bank was paid in full with payments occurring on Aug. 27, 2013, and Dec. 3, 2013. 4. The Debtor does not believe there are any holders of allowed Class 4 claims (unknown secured claims). 5. The Allowed Class 5 unsecured claims of the PBGC will be resolved by the Debtor voluntarily terminating the pension. 6. Class 6 the allowed unsecured claim of VNB, if any, will be paid following the conclusion of the foreclosure action on the Aldrich Building, the property that secures the obligation to VNB. 7. Allowed Class 7 claim holders will be paid with interest in full from the currently sequestered proceeds of the sale of the real property, or in a lesser amount agreed to between the Debtor and the claim holder, no later than 30 days after the Effective Date or within such other term as is agreed upon the Debtor and the holder of the claim. Upon the effective Date, the Debtor will, if feasible, recover any property in the hands of third parties. The Debtor will attempt to collect its receivable. Plan payments will be made from the proceeds of the sale of the Debtor's property that are currently sequestered in the Debtor's counsel's trust account. If necessary, additional real estate will be sold. As indicated on the Debtor's Monthly Operating Report, as of March 31, 2014, the Debtor had $691,982 in funds available. A copy of the Disclosure Statement is available for free at http://bankrupt.com/misc/MUNDYRANCH_2ds.pdf As reported in the Troubled Company Reporter on May 2, 2014, certain creditors of the Debtor filed objections to the approval of the Debtor's Disclosure Statement. They include Valley National Bank; Fr. Robert Mundy; and Comeau, Maldegen, Templeman & Indall. In 2004, the Debtor guaranteed a debt obtained by Aldrich Building LLC from Valley Bank. As security, Aldrich executed a mortgage to Valley Bank consisting of a real property known as the Aldrich Building. Valley Bank objects to the Disclosure Statement because the Debtor does not provide an estimate or a basis for an estimation of the value of the Building property. Without that information, it is unclear how the Debtor concludes that a sale of the Building property would satisfy the Guaranty obligation or that there will be no deficiency after sale. Valley Bank also complains that the Disclosure Statement fails to disclose that the Debtor must pay the Guaranty claim in full if equity interest holders are to retain their interests in the Debtor. Fr. Robert Mundy, a shareholder, for his part, is concerned that no date has been provided in the Disclosure Statement by which his shareholder interest will be satisfied. Without such date, he said he cannot intelligently vote on the Plan. The Plan provides that no distribution will be made to any shareholder prior to the time that all Class 5 PBGC Claim and Class 7 General Unsecured Claims are paid in full. The CMTI Firm is a general unsecured creditor, having provided a variety of legal services to the Debtor. The Firm seeks unpaid prepetition fees from the Debtor. The Firm complains that the Disclosure Statement does not make adequate information about the Firm. Valley National Bank is represented by: WALKER & ASSOCIATES, P.C. Thomas D. Walker, Esq. Ryan J. Kluthe, Esq. 500 Marquette NW, Suite 650 Albuquerque, NM 87102 Email: twalker@walkerlawpc.com Fr. Robert Mundy is represented by: MOORE, BERKSON & GANDARILLA, P.C. Daniel J. Behles, Esq. 3800 Osuna Road, NE, Ste. 2 Albuquerque, NM 87109 Tel No: (505) 242-1218 Email: dan@behles.com The CMTI Firm is represented by: COMEAU, MALDEGEN, TEMPLEMAN & INDALL, LLP Paula A. Cook, Esq. Larry D. Maldegen, Esq. P.O Box 669 Santa Fe, NM 87504-0669 Tel No: (505) 982-4611 Email: pcook@cmtisantafe.com lmaldegen@cmtisantafe.com About Mundy Ranch Mundy Ranch Inc. -- http://www.mundyranch.com/-- is a family- owned corporation organized under the laws of the State of New Mexico with its principal place of business in Rio Arriba County, New Mexico. Mundy Ranch sells undeveloped parcels of real property in northern New Mexico which together occupy approximately 6,000 acres of land. The majority of the land consists of an undivided 5,500 acre parcel, which is also called Mundy Ranch. Mundy Ranch scheduled the Mundy Ranch Parcel as having a value of $17,000,000, with secured claims against the Mundy Ranch Parcel in the amount of $2,095,000. Mundy Ranch generates substantially all of its revenue from developing and selling parcels of land. It generates a small amount of revenue by selling Christmas trees. Mundy Ranch, Inc., filed a Chapter 11 petition (Bankr. D. N.M. Case No. 12-13015) in Albuquerque, New Mexico. The Law Office of George Dave Giddens, PC, in Albuquerque, serves as counsel to the Debtor. The Debtor estimated assets of $10 million to $50 million and debts of up to $10 million. NAMCO FINANCIAL: Insurers Can Rescind $20MM From Fraudster's Firm ----------------------------------------------------------------- Law360 reported that a California federal judge let four insurers rescind $20 million of commercial crime policies issued to Namco Financial Exchange Corp., a bankrupt real estate firm whose founder was convicted of fraud, finding that Namco had lied on its insurance applications. According to the report, U.S. District Judge Dolly M. Gee granted summary judgment to the insurers -- Liberty Mutual Insurance Co., Zurich American Insurance Co., Axis Insurance Co. and Twin City Fire Insurance Co. -- in the coverage suit brought by Namco's bankruptcy trustee, entitling them to rescind the policies. "Here, it is uncontroverted that the insurance application included a question to which [Namco] provided a false answer," the judge wrote in the order, the report related. "The court cannot draw any other reasonable inference from the facts in the record." Heidi Kurtz, Namco's bankruptcy trustee, sued the insurers in 2011 to force them to cover some of the $43 million that the company's top executives had misappropriated from clients in 1,031 exchanges, the report further related. Also known as "like-kind" exchanges, the real estate transactions were supposed to let the clients avoid taxes by allowing Namco to hold onto the proceeds from property sales before they were reinvested. Namco's founder and president, Los Angeles real estate tycoon Ezri Namvar, was sentenced to seven years in prison in October 2011 after being convicted on wire fraud charges for stealing $21 million from four clients, the report added. However, his co- defendant and right-hand man at Namco, Hamid Tabatabai, had his conviction on related charges overturned by the Ninth Circuit last year. The case is Kurtz v. Liberty Mutual Insurance Co. et al., case number 2:11-cv-07010, in the U.S. District Court for the Central District of California. NORTEL NETWORKS: Canadian Debtors Directed to Produce Documents --------------------------------------------------------------- The U.S. Bankruptcy Court has directed Nortel Networks Inc.'s Canadian affiliates to produce to all core parties certain disputed document, the 12 related documents clawed back on Nov. 7, 2013, and provided to the Court on April 17, 2014, and the Orlando Testimony. The order was pursuant to Section 15 of the cross border insolvency protocol, on the Joint Administrators' motion for production of documents in the Canadian proceedings. The production to all core parties of the disputed document, the related documents and the Orlando testimony are not and will not be deemed to a be a waiver of privilege, if any, and are not and will not be a waiver of the privilege, if any, related to the subject matter of the documents and testimony for this and any other purpose. The Debtors have filed under seal with the U.S. Bankruptcy Court the US interests' motion to strike the expert reports of the UK Pension Claimants and the Canadian Creditors Committee advocating for a "pro rata distribution" to creditors. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did business in more than 150 countries around the world. Nortel Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, the Debtors are represented by: Howard S. Zelbo, Esq. CLEARY GOTTLIEB STEEN & HAMILTON LLP One Liberty Plaza New York, NY 10006 Tel: (212) 225-2000 Fax: (212) 225-3999 Derek C. Abbott, Esq. MORRIS, NICHOLS, ARSHT & TUNNELL LLP 1201 North Market Street P.O. Box 1347 Wilmington, Delaware 19801 Tel: (302) 658-9200 Fax: (302) 658-3989 The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The U.S. Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Unsecured Creditors Committee. An ad hoc group of bondholders also was organized. An Official Committee of Retired Employees and the Official Committee of Long- Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. Judge Gross and the court in Canada scheduled trials in 2014 on how to divide proceeds among creditors in the U.S., Canada, and Europe. OCWEN FINANCIAL: Fitch Rates Senior Unsecured Notes 'CCC/RR6' ------------------------------------------------------------- Fitch Ratings expects to rate Ocwen Financial Corporation's (OCN) proposed five-year, $350 million 6.625% senior unsecured note issuance 'CCC/RR6'subject to receipt of final documents conforming to information already received. The final maturity date in 2019 will be set at the time of issuance. Key Rating Drivers The expected 'CCC' rating of the notes, which is two notches below OCN's long-term IDR of 'B', reflects the company's predominately secured funding profile and the modest level of unencumbered balance sheet assets available to support the unsecured noteholders in a stressed scenario. Pro forma for the debt issuance, OCN's funding profile would be 93% secured. The expected Recovery Rating of 'RR6' reflects Fitch's expectation that recovery prospects for the notes are poor, and could be as low as 0%-10% in a stress scenario. The notes are expected to rank equally in right of payment with all existing and future senior unsecured indebtedness and will be effectively subordinated to all of OCN's secured indebtedness and all of the existing and future liabilities of OCN's subsidiaries. The proceeds of the issuance are expected to be used for general corporate purposes, including financing the repurchase of OCN's common shares. Fitch views using debt for share repurchases as non-creditor friendly. Leverage, as measured by total debt to tangible equity is expected to increase from 3.6x as of March 31, 2014 to 5.2x on a pro forma basis, assuming 100% of the proceeds from the debt issuance were used to repurchase common shares. OCN has a long-term Issuer Default Rating (IDR) of 'B' and a Stable Rating Outlook. The long-term IDR reflects OCN's operating cash flow generation and sufficient liquidity, positive asset/liability positioning relative to a rising rate environment, and appropriate capitalization and leverage for its current ratings. Rating constraints include continued regulatory scrutiny of the mortgage servicing industry, organizational complexity and governance limitations associated with OCN and its affiliate companies, an aggressive historical growth strategy which has increased integration and balance sheet risks, and low Fitch Core Capital levels. Rating Sensitivities - Unsecured Notes The rating of the senior unsecured notes will be sensitive to any changes in OCN's long-term IDR as well as to changes in OCN's funding profile, the mix of secured versus unsecured funding, and unencumbered asset coverage. A material increase in unsecured funding, combined with a material improvement in unencumbered asset coverage could reduce the notching between the IDR and the unsecured notes and/or improve the Recovery Rating. Rating Sensitivities - IDR Positive rating momentum in OCN's IDR could be driven by sustained and effective management of the regulatory environment, reduced organizational complexity, a continued moderation in OCN's pace of growth, successful integration of recently acquired mortgage servicing rights, reduced overall leverage through consistent cash flow generation and deleveraging over time, and improved Fitch Core Capital levels. Conversely, negative rating action for OCN's IDR would be driven by a considerable reduction in revenue and cash flow generation caused by deterioration in portfolio performance, or a material change in OCN's cost structure resulting from integration, legal or regulatory risks. In addition, future large-scale portfolio or business acquisitions that materially increase leverage over a sustained period could also result in further negative rating actions. Fitch assigns expected ratings to the following: Ocwen Financial Corporation --Senior unsecured notes 'CCC/RR6'. Fitch currently rates the following: Ocwen Financial Corporation --Long-term IDR of 'B'; --Short-term IDR of 'B'. Ocwen Loan Servicing, LLC --Long-term IDR of 'B'; --Senior secured term loan of 'B/RR4'. The Rating Outlook is Stable. ORTHO-CLINICAL DIAGNOSTICS: Debt Increase No Impact on Moody's CFR ------------------------------------------------------------------ Moody's commented that the change in Ortho-Clinical Diagnostic's capital structure that will result in an increase in debt of $150 million, and a commensurate decrease in equity contributed by The Carlyle Group is credit negative. There is no change to the ratings, including the B2 Corporate Family Rating, B2-PD Probability of Default Rating, the B1 senior secured rating or the Caa1 unsecured notes rating. Ortho-Clinical Diagnostics ("OCD"), headquartered in Raritan, NJ, produces in-vitro diagnostics equipment and associated assays and reagents. OCD's largest segment, Clinical Laboratories, develops clinical chemistry and immunoassay tests, targeting primarily small/medium size hospitals. OCD also develops Immunohematology products used by blood banks and hospitals to determine patient- donor compatibility in blood transfusions. OCD also develops and markets equipment and assays for blood and plasma screening for infectious diseases. The company generated approximately $1.9 billion of revenues for the year ending December 29, 2013. OCD, currently a business unit of Johnson & Johnson ("J&J"), is being sold to the Carlyle Group ("Carlyle"). ORTHO-CLINICAL DIAGNOSTICS: S&P Keeps 'B' CCR After Upsized Debt ---------------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings on New Jersey-based Ortho-Clinical Diagnostics Inc. are not affected by the company's decision to upsize its proposed senior notes by $150 million, reducing the equity component of the purchase price. S&P's ratings on OCD reflect its assessment of a "highly leveraged" financial risk profile and "fair" business risk profile. S&P's assessment of a highly leveraged financial risk profile considers leverage that S&P expects to be around 6.6x pro forma the revised capital structure, and funds from operations to debt that S&P expects to be sustained in the low-double digits. In addition, S&P's assessment of a highly leveraged financial risk profile incorporates its view that sponsor ownership is likely to shape a financial policy that prioritizes growth objectives and shareholder return over deleveraging. RATINGS LIST Ortho-Clinical Diagnostics Inc. Corporate credit rating B/Stable/-- Senior notes B Recovery rating 3 PEABODY ENERGY: Fitch Affirms 'BB' Issuer Default Rating -------------------------------------------------------- Fitch Ratings has affirmed Peabody Energy Corporation's (Peabody, NYSE: BTU) Issuer Default Rating (IDR) at 'BB'. The Rating Outlook has been revised to Negative. Fitch believes the coal markets are at or near the bottom of the cycle and should begin to show a slow recovery. The Negative Outlook reflects the possibility that overcapacity persists in the metallurgical coal market and the hard coking coal benchmark price remains below $150/tonne (t) beyond the next 12-18 months. Fitch expects leverage could be above 4.5x through 2015. Key Ratings Drivers Peabody's ratings reflect large, well-diversified operations and good control of its low-cost production. The credit ratings also reflect high financial leverage following the acquisition of Macarthur Coal Limited in an all-cash transaction in the fourth quarter of 2011. Peabody is the largest private sector coal company, globally, with 27 mining operations producing low-sulfur thermal coal from the Powder River Basin (PRB) and high heat thermal coal from the Illinois Basin (IB) as well as seaborne thermal and metallurgical coal in Australia. Proven and probable reserves are about 8.3 billion tons. Peabody is targeting 2014 U.S. volumes at 185 to 195 million tons with 90-95% of those volumes committed and priced for 2014. Based on projected 2014 production levels, 50 - 60% of 2015 U.S. volume is priced. Steam coal prices in the U.S. are rebounding given low coal and gas inventories, higher natural gas prices and improved power demand. Globally, both metallurgical (met) and steam coal are in excess supply and prices are weak. Coal producers have been running for cash with a focus on reducing costs which is expected to delay price recovery. In particular, Fitch believes the hard coking coal bench mark price could average about $135/t and the Newcastle steam coal benchmark could be below $85/t over the next 12 months. The industry is consolidating which should benefit supply/demand dynamics longer term. Peabody's earnings are leveraged to metallurgical coal prices. The Australian segment comprises seaborne coking, pulverized coal injection (PCI) and steam coal sales. For 2013, the Australian adjusted EBITDA was $317 million on 34.9 million tons sold at average realizations of $83.26/ton compared with $939 million on 33.0 million tons sold at average realizations of $106.05/ton for 2012. Fitch's calculation of consolidated operating EBITDA for 2013 was $962 million compared with $1.8 billion for 2012. Capital Structure Total debt with equity credit of $6 billion compares to preliminary LTM March 31, 2014 operating EBITDA of $844 million at 7x. Fitch expects Peabody to continue to focus on debt repayment while leverage is above 3x but thereafter to invest in Australia and Asia to the extent of its free cash flow. Strong Liquidity Cash on hand was $508 million as of March 31, 2014 and total liquidity was $2.1 billion. The company has a $1.65 billion secured revolving credit facility maturing on Sept. 24, 2018 or Aug. 15 2018 if the $1.5 billion 6% Senior Notes due in November 2018 remain outstanding. Utilization is estimated at $132 million for letters of credit. The company also has a $275 million accounts receivable securitization program maturing in April 2016 which had $117 million available at Dec. 31, 2013. Revolver covenants include an interest coverage minimum of 1.50:1 through Dec. 31, 2015 with step-ups thereafter and a maximum net secured leverage ratio of 3.50:1 through Dec. 31, 2015 with step-downs thereafter. Fitch anticipates that Peabody will operate within its covenants. Scheduled maturities of long-term debt are estimated at $32 million in 2014, $19 million in 2015, $666 million in 2016, $12 million in 2017 and $1.5 billion in 2018. Expectations Fitch believes operating EBITDA could drop to $780 million for 2014 on lower average metallurgical coal prices. Under the same assumptions, negative free cash flows could be as much as $200 million. Peabody guides to 2014 capital expenditure of $250 million to $295 million before coal lease expenditures ($276.8 million in 2013). Interest expense runs about $400 million and dividends are about $92 million, annually. Rating Sensitivities Negative: Future developments that may, individually or collectively, lead to a negative rating action include: -- Cash operating losses in Australia; -- Expectations of negative free cash flow beyond 2014; -- Failure to reduce debt; -- Expectations of Total Debt/EBITDA greater than 3.5x in 2016. Positive: Future developments that may lead to a positive rating action are not anticipated over the next 12 months but may include: -- Leverage sustainably below 3.5x. Fitch has affirmed Peabody's ratings as follows: -- IDR at 'BB'; -- Senior secured revolving credit and terms loan at 'BB+'; -- Senior unsecured notes, revolving credit, and term loans at 'BB'; -- Convertible junior subordinated debentures due 2066 at 'B+'. PERSONAL COMMUNICATIONS: Confirms Liquidating Plan -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Personal Communications Devices LLC, once a distributor of wireless-communications devices, got the green light to exit Chapter 11 when a U.S. bankruptcy judge in Central Islip, New York, signed a confirmation order on April 11 approving the liquidating plan. According to the report, unsecured creditors were told to expect a 2.8 percent recovery on $175.8 million in claims. The plan was jointly proposed by the company and the official creditors' committee. PCD sold the business in mid-October to competitor Quality One Wireless LLC under a contract with a $105 million sticker price, the report related. The sale fully paid off $105 million in secured debt, leaving no secured claims to be handled in the plan. In the sale, secured creditors received either cash or new debt. The sale was accompanied by a settlement where the buyer provided $500,000 for winding down the Chapter 11 case and $3 million toward expenses of the Chapter 11 process, the report further related. About PCD Personal Communications Devices LLC and an affiliate, Personal Communications Devices Holdings, LLC, filed for Chapter 11 bankruptcy (Bankr. E.D.N.Y. Case No. 13-74303) on Aug. 19, 2013, in Central Islip, N.Y. The Debtor disclosed $247,952,684 in assets and $284,985,134 in liabilities as of the Chapter 11 filing. PCD -- http://www.pcdphones.com-- was in the business of providing carriers and manufacturers an array of product life cycle management services that includes planning and development; inventory; technical testing; quality control; forward and reverse logistics; sell-in and sell-thru, marketing & warranty support. PCD sold its assets to Quality One Wireless LLC for $105 million in October 2013. The bankruptcy auction was cancelled as no competing offers were submitted. Bankruptcy Judge Alan S. Trust oversees the case. Attorneys at Goodwin Procter, LLP and Togut, Segal & Segal, LLP serve as counsel to the Debtors. Epiq Bankruptcy Solutions, LLC, is the claims and notice agent. BG Strategic Advisors, LLC, is the financial advisor. Richter Consulting, Inc., is the investment banker. Q1W is advised by Raymond James and Associates, Inc. and Munsch Hardt Kopf & Harr, P.C. A three-member official committee of unsecured creditors was appointed in the Chapter 11 case. The Committee retained FTI Consulting, Inc., as financial advisor, and Perkins Coie LLP as counsel. PHILLIPS PLASTICS: Moody's Places B1 CFR on Review for Downgrade ---------------------------------------------------------------- Moody's Investors Service placed the ratings of Phillips Plastics Corporation, a wholly-owned subsidiary of Phillips-Medisize Corporation, under review for downgrade, including the company's B1 Corporate Family Rating, B1-PD Probability of Default Rating, and the company's existing debt instrument ratings. The review was prompted by the announcement on May 7, 2014 that Golden Gate Capital has agreed to purchase Phillips-Medisize Corporation from funds managed by Kohlberg & Company, L.L.C. The following ratings were placed under review for downgrade: Phillips Plastics Corporation: Corporate Family Rating, B1 Probability of Default Rating, B1-PD Senior secured revolving credit facility, B1 (LGD 3, 48%) Senior secured first lien term loans, B1 (LGD 3, 48%) Ratings Rationale Although financing details have not been provided, the company could have higher financial leverage following the pending sale. The rating review will focus primarily on the financial leverage and the capital structure that will result from the sale to Golden Gate Capital, as well as ongoing operating trends at Phillips. The B1 Corporate Family Rating (currently under review) reflects the company's high financial leverage, limited coverage of interest expense and modest free cash flow. The rating reflects the company's small absolute size when compared to other B-rated corporate issuers, and considerable concentration of revenue from its top customers. Offsetting these factors, the rating is supported by the company's good geographic diversification and solid technical capabilities. In addition, providing stability to Phillips' business profile are the company's longstanding customer relationships, high barriers to entry, and significant switching costs for existing customers. However, given the company's weak credit metrics, there is minimal cushion within the current B1 rating for additional financial leverage. The principal methodology used in this rating was the Global Manufacturing Industry published in December 2010. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Phillips Plastics Corporation ("Phillips") a wholly-owned subsidiary of Phillips-Medisize Corporation, provides design and contract manufacturing services to the Drug Delivery, Consumable Diagnostic and Specialty Commercial markets. Approximately seventy-five percent of company revenue is from Drug Delivery and medical products. Phillips is owned by Kohlberg & Company ("Kohlberg"). For the twelve months ended December 31, 2013, the company generated net sales of approximately $500 million. QUANTUM FOODS: Union Says $54MM Sale Must Respect Contracts ----------------------------------------------------------- Law360 reported that an employee union at Quantum Foods LLC urged a Delaware bankruptcy judge to delay consideration of the meatpacker's planned $54 million sale to a unit of Oaktree Capital Management LP, saying the proposed deal violates existing labor contracts. According to the report, United Food & Commercial Workers International Union Local 1546, which represents about 860 Quantum employees, claims the Oaktree purchase agreement cannot be approved as written because it is contingent on modifications to current collective bargaining agreements. "Local 1546, accordingly, conditionally objects to a sale to Oaktree, in the absence of consensual labor agreements because, by contract, any successor is bound to the existing labor agreements," the union said in a response filed with the court, the report related. The UFCW local is party to two collective bargaining agreements with Quantum, and a sale order that transfers the company's assets free and clear of its obligations under the CBAs is inconsistent with the contracts and the Bankruptcy Code, according to the response, the report further related. "While Local 1546 has commenced and is continuing discussions with Oaktree concerning the collective bargaining agreements, no agreements have yet been reached and, indeed, bargaining is at a preliminary stage," the union said, the report added. About Quantum Foods Founded in 1990 and headquartered in Bolingbrook, Illinois, Quantum Foods, LLC -- http://www.quantumfoods.com-- provides protein products made from beef, poultry and pork. Quantum Foods and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 14-10318) on Feb. 18, 2014, to facilitate the sale of substantially all their business to CTI Foods Holding Co., LLC. The Debtors' primary secured indebtedness totals $50.2 million, owing to lenders led by Crystal Financial, LLC, as administrative and collateral agent. Quantum Foods is being advised in its restructuring by Daniel J. McGuire, Esq., Gregory M. Gartland, Esq., and Caitlin S. Barr, Esq., at Winston & Strawn as counsel; M. Blake Cleary, Esq., Kenneth J. Enos, Esq., and Andrew Magaziner, Esq., at Young, Conaway, Stargatt & Taylor, LLP, serve as local counsel. City Capital Advisors is the investment banker. FTI Consulting, Inc. also serves as advisor. BMC Group is the claims and notice agent. The U.S. Trustee for Region 3 appointed five members to the official committee of unsecured creditors in the case. The Committee is seeking to retain Triton Capital Partners, Ltd. as financial advisor; and Mark D. Collins, Esq., Russell C. Silberglied, Esq., Michael J. Merchant, Esq., Christopher M. Samis, Esq., and Robert C. Maddox, Esq., at Richards, Layton & Finger, P.A. as counsel. Raging Bull is represented in the case by Van C. Durrer II, Esq., at Skadden Arps Slate Meagher & Flom LLP. Crystal Finance LLC is represented by David S. Berman, Esq., at Riemer & Braunstein LLP. RADIOSHACK CORP: Mired in Talks With Lenders Over Closings ---------------------------------------------------------- Emily Glazer, writing for The Wall Street Journal, reported that RadioShack Corp. is mired in negotiations with its lenders over plans to close as many as 1,100 stores, complicating the struggling consumer-electronics retailer's turnaround efforts, said people familiar with the talks. According to the report, the delay also is intensifying tensions with some lenders, who were surprised by the store-closing plan when RadioShack publicly disclosed it on March 4, the people said. The company, which operates about 4,300 stores in the U.S., said at the time that the plan still needed permission from its lenders, adding that its credit agreements allowed it to close only about 200 stores without the approval of lead lenders Salus Capital Partners and GE Capital, a unit of General Electric Co., the report related. The company also said in March that it planned to spend the next month hammering out an agreement with its lenders before choosing a liquidator to wind down the stores, the report further related. Meanwhile, RadioShack has continued its store-closing plan but is currently targeting just 200 stores, the report added, citing people familiar with the plan said. Some landlords have agreed to lower rents in an effort to keep certain stores open, these people said. About Radioshack Corporation RadioShack (NYSE: RSH) -- -- http://www.radioshackcorporation.com -- is a national retailer of innovative mobile technology products and services, as well as products related to personal and home technology and power supply needs. RadioShack's retail network includes more than 4,300 company-operated stores in the United States, 270 company-operated stores in Mexico, and approximately 1,000 dealer and other outlets worldwide. Radioshack disclosed a net loss of $139.4 million in 2012, as compared with net income of $72.2 million in 2011. The Company's balance sheet at Sept. 30, 2013, showed $1.60 billion in total assets, $1.21 billion in total liabilities and $394 million in total stockholders' equity. * * * As reported by the TCR on Dec. 26, 2013, Standard & Poor's Ratings Services raised the corporate credit rating on the Fort Worth, Texas-based RadioShack Corp. to 'CCC+' from 'CCC'. "The upgrade reflects an improved liquidity position with a recent financing that increased funded debt by $125 million and increased the company's revolving credit borrowing capacity, which improved the company's liquidity by approximately $200 million," said credit analyst Charles Pinson-Rose. In the Dec. 30, 2013, edition of the TCR, Fitch Ratings has affirmed its 'CCC' Long-term Issuer Default Rating (IDR) on RadioShack Corporation. The IDR reflects the significant decline in RadioShack's profitability and cash flow, which has become progressively more pronounced over the past two years. As reported by the TCR on March 6, 2013, Moody's Investors Service downgraded RadioShack Corporation's corporate family rating to Caa1 from B3 and probability of default rating to Caa1-PD from B3- PD. RadioShack's Caa1 Corporate Family Rating reflects Moody's opinion that the overall business strategy of the company to reverse the decline in profitability has not gained any traction. Troubled Company Reporter, citing The Wall Street Journal, reported on March 5, 2014, that RadioShack plans to cut back its store count, after a sharp drop in sales over the holidays left it with a $400 million loss in 2013. The electronics retailer said it could close as many as 1,100 U.S. stores -- one out of every four that it operates itself -- underscoring the difficulty it has had adapting to a fast changing consumer landscape. REGIONAL CARE: May 15 Hearing on Confirmation of Amended Plan ------------------------------------------------------------- Pinal County Treasurer, a secured tax lien creditor, objects to confirmation of the Second Amended Joint Plan of Reorganization dated March 28, 2014, filed by Regional Care Services Corp and Casa Grande Community Hospital, dba Casa Grande Regional Medical Center. PCT noted that the Debtor's real property is located at 1800 East Florence Blvd., Casa Grande, Arizona, and is encumbered with a fully secured tax lien pursuant to A.R.S. Section 42-17153. PCT said that the Plan fails to provide for payment of PCT's claim as a secured claim for the 2013 and 2014 real property taxes on the parcels. As evidenced by PCT's tax statement for the parcels, the current amount owed is actually $103,290 and $111,097, with interest accruing at the statutory rate of 16% per annum. Accordingly, PCT requested that the Court order that the Plan be amended to provide that PCT's claims are treated as secured, and to be paid in full, the amount of $103,790 and $111,097, plus accruing interest at the statutory rate of 16% per annum. The Court has rescheduled the confirmation hearing to May 15, 2014, at 9:30 a.m. As reported in the Troubled Company Reporter on April 17, 2014, Bankruptcy Judge Eileen W. Hollowell set the confirmation hearing on May 15, at 10:00 a.m. The Plan hinges on the sale of substantially all of the Debtors' assets to Banner Health in exchange for up to $87 million in cash (subject to adjustments) and forgiveness of loans. Cash proceeds received upon the sale closing will pay the Debtors' bond indebtedness, in the aggregate principal amount of $63,785,000 plus accrued interest and fees, in full in exchange for subordination of the $1.3 million prepayment fee to all other claims. The remainder of the sale proceeds will be placed in a trust for the benefit of creditors. Administrative expenses, priority claims, and secured claims will be paid in full from the Creditor Trust. Remaining funds will be distributed to general unsecured creditors followed by payment of the Allowed Bond Redemption Premium Claim. The Debtors project there will be sufficient funds to pay all creditors in full upon closing of the sale; any surplus would be returned to Banner. Following final distributions, the Debtors' estates will be wound down. A copy of the Disclosure Statement is available for free at: http://bankrupt.com/misc/REGIONALCARE_amendedds.pdf The Debtors are represented by: Michael McGrath, Esq. Kasey C. Nye, Esq. MESCH, CLARK & ROTHSCHILD, P.C. 259 North Meyer Avenue Tucson, Arizona 85701 Tel: (520) 624-8886 Fax: (520) 798-1037 E-mails: mmcgrath@mcrazlaw.com knye@mcrazlaw.com - and - Michael J. Pankow, Esq. Joshua M. Hantman, Esq. BROWNSTEIN HYATT FARBER SCHRECK, LLP 410 Seventeenth Street, Suite 2200 Denver, CO 80202-4432 Tel: (303) 223-1100 Fax: (303) 223-1111 E-mails: mpankow@bhfs.com jhantman@bhfs.com About Casa Grande Community Hospital and Regional Care Services Regional Care Services Corp., Casa Grande Community Hospital d/b/a Casa Grande Regional Medical Center, Regional Care Physician's Group, Inc., and Casa Grande Regional Retirement Community sought Chapter 11 protection (Bankr. D. Ariz. Lead Case No. 14-01383) in Tucson, Arizona, on Feb. 4, 2014. The Debtors, one of the largest employers in Pinal County, operate an award winning, full service non-profit community hospital serving more than 65,000 patients each year from the largely rural communities of Casa Grande, Sacaton, Eloy, Florence and surrounding communities. CGRMC is a 177-licensed bed, general acute care hospital located in Casa Grande, Arizona. RCSC is the sole member and sponsor of CGRMC, RCPG and CGRRC. As of the Petition Date, CGRRC's management consists of Rona Curphy as President, Cherie McGlynn as Chairman, David Fitzgibbons as Vice Chairman, and John Robert McEvoy as Secretary/Treasurer. Michael McGrath, Esq., and Kasey C. Nye, Esq., at Mesch, Clark & Rothschild, P.C., in Tucson, Arizona; and Michael J. Pankow, Esq., and Joshua M. Hantman, Esq., at Brownstein Hyatt Farber Schreck, LLP, in Denver, Colorado, serve as counsel to the Debtor. Casa Grande Hospital estimated $50 million to $100 million in assets and liabilities. Banner Health is also providing $6.2 million of DIP financing. Banner Health is represented in the case by Robert M. Charles, Jr., Esq., and Susan M. Freeman, Esq., at Lewis Roca Rothgerber LLP, as counsel. Ilene J. Lashinsky, the U.S. Trustee for Region 14, has not appointed a committee of unsecured creditors. The U.S. Trustee reserves the right to appoint such a committee should interest develop among the creditors. RESTORA HEALTHCARE: Panel Hires Morris James as Co-counsel ---------------------------------------------------------- The Official Committee of Unsecured Creditors of Restora Healthcare Holdings, LLC and its debtor-affiliates sought and obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ Morris James LLP as co-counsel to the Committee, nunc pro tunc to Mar. 6, 2014. The Committee requires Morris James to: (a) advise the Committee with respect to its rights, duties, and powers in these chapter 11 cases; (b) assist and advise the Committee in its consultations with the Debtors relative to the administration of these chapter 11 cases; (c) assist the Committee in analyzing the claims of the Debtors' creditors and the Debtors' capital structure and in negotiating with holders of claims and equity interests; (d) assist the Committee in its investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtors and of the operation of the Debtors' businesses; (e) assist the Committee in its investigation of the liens and claims of the holders of the Debtors' pre-petition debt and the prosecution of any claims or causes of action revealed by such investigation; (f) assist the Committee in its analysis of, and negotiations with, the Debtors or any third party concerning matters related to, among other things, the assumption or rejection of certain leases of nonresidential real property and executory contracts, asset dispositions, financing of other transactions and the terms of one or more plans of reorganization for the Debtors and accompanying disclosure statements and related plan documents; (g) assist and advise the Committee as to its communications to unsecured creditors regarding significant matters in these chapter 11 cases; (h) assist as needed as conflicts counsel and handle any matters that may present a potential conflict for Alston Bird; (i) represent the Committee at hearings and other proceedings; (j) review and analyze applications, orders, statements of operations, and schedules filed with the Court and advise the Committee as to their propriety; (k) assist the Committee in preparing pleadings and applications as may be necessary in furtherance of the Committee's interests and objectives; (l) prepare, on behalf of the Committee, any pleadings, including without limitation, motions, memoranda, complaints, adversary complaints, objections, or comments in connection with any of the foregoing; and (m) perform such other legal services as may be required or are otherwise deemed to be in the interests of the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code, Bankruptcy Rules, or other applicable law. Morris James will be paid at these hourly rates: Partners $400-$605 Senior Counsel $430 Paraprofessionals $210-$225 Morris James will also be reimbursed for reasonable out-of-pocket expenses incurred. Brett D. Fallon, Esq., partner of Morris James, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Morris James can be reached at: Brett D. Fallon, Esq. MORRIS JAMES LLP P.O. Box 2306 Wilmington, DE 19899-2306 Tel: (302) 888-6888 Fax: (302) 571-1750 E-mail: bfallon@morrisjames.com About Restora Healthcare Restora Healthcare Holdings, LLC, and two of its affiliates filed separate Chapter 11 bankruptcy petitions (Bankr. D. Del. Case Nos. 14-10367 to 14-10369) on Feb. 24, 2014. The petitions were signed by George W. Dunaway as chief financial officer. Restora Healthcare estimated assets and debts of at least $10 million. DLA Piper LLP (US) serves as the Debtors' counsel. The Debtors tapped George D. Pillari, a managing director of Alvarez & Marsal Healthcare Industry Group, LLC, as chief restructuring officer. The U.S. Trustee appointed five creditors to serve on the Official Committee of Unsecured Creditors. Restora Healthcare Holdings disclosed $1,789,247 in assets, ad $11,328,016 in liabilities. Restora Hospital of Mesa reported $6,996,725 in assets and $11,186,942 in liabilities. Restora Hospital of Sun City also reported $5,327,278 in assets $9,109,597 in liabilities. In April 2014, Restora obtained Court approval to sell substantially all of their assets to PHX Hospital Partners, LLC, an entity formed by several of the Debtors' creditors and landlords. An April 22 auction assets was cancelled after one other party withdrew its competing bid on the day of the auction. No other bids were received prior to the bid deadline. PHX Hospital, the stalking horse purchaser, was declared the successful bidder. In exchange for the Debtors' two long-term acute-care hospitals, PHX will provide consideration consisting of (a) $5,000,000 payable in the form of a credit bid, (b) a waiver by the Landlord of certain cure costs with respect to two real property leases, and (c) the assumption of certain liabilities and the the payment of all cure costs relating to executory contracts and unexpired leases to be assumed and assigned to the Stalking Horse Purchaser. To protect the welfare of patients, the U.S. Trustee for Region 3, appointed Laura Patt as the patient care ombudsman. Ms. Patt has retained Bryan Cave LLP as her counsel. RESTORA HEALTHCARE: Panel Taps CohnReznick as Financial Advisor --------------------------------------------------------------- The Official Committee of Unsecured Creditors of Restora Healthcare Holdings, LLC and its debtor-affiliates sought and obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ CohnReznick LLP as financial advisor to the Committee, nunc pro tunc to Mar. 6, 2014. The Committee requires CohnReznick LLP to: (a) review the reasonableness and feasibility of the Cash Collateral/DIP arrangements as to its cost to the Debtors and the likelihood that Debtors will be able to comply with the terms of the Order; (b) analyze and review key motions (critical vendors, reclamation procedures, sale) to identify strategic case issues; (c) perform an assessment of the Debtors' short-term budgets; (d) establish reporting procedures that will allow for the monitoring of the Debtors' sales and wind-down activities; (e) develop and evaluate alternative sale strategies; (f) scrutinize proposed sale transactions, including the assumption and rejection of executory contracts; (g) identify, analyze and investigate transactions with non- Debtor entities and other related parties; (h) monitor the Debtors' weekly operating results; (i) analyze the Debtors' budget-to-actual results on an ongoing basis for reasonableness and cost control; (j) communicate findings to the Committee; (k) identify and quantify any recoverable assets which are not in the Debtors' estates; (l) determine whether the Board of Directors and senior management performed their fiduciary duties; (m) determine if there are potential claims against the Debtors' auditors or Board members; (n) investigate and analyze all potential avoidance action claims; (o) determine the accuracy of historical and current financial data, which may have been compromised while operating in a distressed environment; (p) assist the Committee in negotiating the key terms of a Plan of Liquidation/Reorganization; (q) review the nature and origin of other significant claims asserted against the Debtors; (r) prepare dividend analyses to determine the potential return to unsecured creditors; and (s) render such assistance as the Committee and its counsel may deem necessary. CohnReznick LLP will be paid at these hourly rates: Partners/Senior Partner $585-$800 Managers/Senior Managers/Directors $435-$620 Other Professional Staff $275-$410 Paraprofessionals $185 CohnReznick LLP will also be reimbursed for reasonable out-of- pocket expenses incurred. Clifford A. Zucker, partner of CohnReznick LLP, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. CohnReznick LLP can be reached at: Clifford A. Zucker CohnReznick LLP 333 Thornall Street Edison, NJ 08837 Tel: (732) 549-0700 About Restora Healthcare Restora Healthcare Holdings, LLC, and two of its affiliates filed separate Chapter 11 bankruptcy petitions (Bankr. D. Del. Case Nos. 14-10367 to 14-10369) on Feb. 24, 2014. The petitions were signed by George W. Dunaway as chief financial officer. Restora Healthcare estimated assets and debts of at least $10 million. DLA Piper LLP (US) serves as the Debtors' counsel. The Debtors tapped George D. Pillari, a managing director of Alvarez & Marsal Healthcare Industry Group, LLC, as chief restructuring officer. The U.S. Trustee appointed five creditors to serve on the Official Committee of Unsecured Creditors. Restora Healthcare Holdings disclosed $1,789,247 in assets, ad $11,328,016 in liabilities. Restora Hospital of Mesa reported $6,996,725 in assets and $11,186,942 in liabilities. Restora Hospital of Sun City also reported $5,327,278 in assets $9,109,597 in liabilities. In April 2014, Restora obtained Court approval to sell substantially all of their assets to PHX Hospital Partners, LLC, an entity formed by several of the Debtors' creditors and landlords. An April 22 auction assets was cancelled after one other party withdrew its competing bid on the day of the auction. No other bids were received prior to the bid deadline. PHX Hospital, the stalking horse purchaser, was declared the successful bidder. In exchange for the Debtors' two long-term acute-care hospitals, PHX will provide consideration consisting of (a) $5,000,000 payable in the form of a credit bid, (b) a waiver by the Landlord of certain cure costs with respect to two real property leases, and (c) the assumption of certain liabilities and the the payment of all cure costs relating to executory contracts and unexpired leases to be assumed and assigned to the Stalking Horse Purchaser. To protect the welfare of patients, the U.S. Trustee for Region 3, appointed Laura Patt as the patient care ombudsman. Ms. Patt retained Bryan Cave LLP as her counsel. RIH ACQUISITIONS: Atlantic Club Casino Confirms Liquidating Plan ---------------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the one-time owner of the Atlantic Club Casino Hotel in Atlantic City, New Jersey, got bankruptcy court approval for a liquidating Chapter 11 plan. Unsecured creditors with claims of $8.7 million will recover nothing to 28 percent, the report said, citing the disclosure statement. There were no secured claims left to deal with in the plan, the report noted. About RIH Acquisitions RIH Acquisitions NJ LLC, doing business as the Atlantic Club Casino Hotel in Atlantic City, New Jersey, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-34483) on Nov. 6, 2013, in Camden, New Jersey, to sell the property in the near term. The Debtors are represented by Michael D. Sirota, Esq., and Warren A. Ustaine, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Hackensack, New Jersey; and Paul V. Shalhoub, Esq., at Willkie Farr & Gallagher LLP, in New York. Duane Morris, LLP, serves as the Debtors' special gaming regulatory counsel. Imperial Capital, LLC, serves as financial advisor and investment banker to the Debtors, while Mercer (US) Inc. serves as compensation consultant. Kurtzman Carson Consultants LLC is the Debtors' claims and noticing agent. Northlight Financial LLC, as DIP Lender, is represented by Harlan W. Robins, Esq., at Dickinson Wright PLLC, in Columbus, Ohio; Kristi A. Katsma, Esq., at Dickinson Wright PLLC, in Detroit, Michigan; and Bruce Buechler, Esq., and Kenneth A. Rosen, Esq., at Lowenstein Sandler LLP, in Roseland, New Jersey. Financing for the Chapter 11 reorganization is being provided by Northlight Financial LLC. An official committee of unsecured creditors appointed in the case is represented by Morton R. Branzburg, Esq., Carol Ann Slocum, Esq., and Richard M. Beck, Esq., at Klehr Harrison Harvey Branzburg LLP. The Committee hired PricewaterhouseCoopers, LLC, as financial advisor. RIH Acquisitions NJ LLC scheduled $17,776,359 in total assets and $16,813,022 in total liabilities. RIVER-BLUFF ENTERPRISES: Court OKs Hiring of Kimel Law as Counsel ----------------------------------------------------------------- River-Bluff Enterprises, Inc. sought and obtained permission from the Hon. Frank L. Kurtz of the U.S. Bankruptcy Court for the Eastern District of Washington to employ Kimel Law Offices as counsel. The Debtor requires Kimel Law to: -- prepare petition and related documents; -- prepare plan and related documents; and -- represent the Debtor on all bankruptcy matters, related to those matters, and any other litigation matters in the bankruptcy court involving bankruptcy law The appointee, Mr. Metiner G. Kimel, is billing the Debtor for services rendered at an hourly rate of $225, plus reimbursement for normal costs and expense. Mr. Kimel, principal of Kimel Law, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Kimel Law can be reached at: Metiner G. Kimel, Esq. KIMEL LAW OFFICES 1115 W. Lincoln Ave., Suite 105 Yakima, WA 98902 Tel: (509) 452-1115 About River-Bluff Enterprises Ellensburg, Washington-based River-Bluff Enterprises, Inc., filed a Chapter 11 bankruptcy petition (Bankr. E.D. Wash. Case No. 14-00843) on March 11, 2014. Metiner G Kimel, Esq., at Kimel Law Offices, in Yakima, Washington, serves as counsel. In its schedules, the Debtor disclosed $10,231,777 in total assets and $17,609,653 in total liabilities. This is River-Bluff's second bankruptcy filing in less than two years. The company previously sought bankruptcy protection (Bankr. E.D. Cal. Case No. 12-92017) in Modesto, California, in July 2012. The case was dismissed in 2013. Gary W. Dryer, Assistant U.S. Trustee for Region 18, informed the U.S. Bankruptcy Court for the Eastern District of Washington that due to the lack of entities eligible to serve on the unsecured creditors' committee, the U.S. Trustee is not appointing an unsecured creditors' committee in the Chapter 11 case of River- Bluff Enterprises, Inc. RIVER-BLUFF ENTERPRISES: Culbertson Jordan Approved as Accountant ----------------------------------------------------------------- River-Bluff Enterprises, Inc. sought and obtained permission from the Hon. Frank L. Kurtz of the U.S. Bankruptcy Court for the Eastern District of Washington to employ Culbertson Jordan as accountants. The Debtor requires Culbertson Jordan to: -- prepare financial reports required by the state and federal agencies including the U.S. Trustee monthly reports; and -- prepare tax returns for the Debtor. The appointees, Mark Jordan and Dennis Culbertson, will seek approval of their fees pursuant to 11 U.S.C. Sec. 329 and 330. Mr. Jordan assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Culbertson Jordan can be reached at: Mark W. Jordan CULBERTSON JORDAN 819 17th Street Modesto, CA 95354 Tel: (209) 544-8150 Ext. 104 Fax: (209) 544-8152 E-mail: Mark@cj-cpas.com About River-Bluff Enterprises Ellensburg, Washington-based River-Bluff Enterprises, Inc., filed a Chapter 11 bankruptcy petition (Bankr. E.D. Wash. Case No. 14- 00843) on March 11, 2014. Metiner G Kimel, Esq., at Kimel Law Offices, in Yakima, Washington, serves as counsel. In its schedules, the Debtor disclosed $10,231,777 in total assets and $17,609,653 in total liabilities. This is River-Bluff's second bankruptcy filing in less than two years. The company previously sought bankruptcy protection (Bankr. E.D. Cal. Case No. 12-92017) in Modesto, California, in July 2012. The case was dismissed in 2013. Gary W. Dryer, Assistant U.S. Trustee for Region 18, informed the U.S. Bankruptcy Court for the Eastern District of Washington that due to the lack of entities eligible to serve on the unsecured creditors' committee, the U.S. Trustee is not appointing an unsecured creditors' committee in the Chapter 11 case of River- Bluff Enterprises, Inc. SABINE OIL: S&P Affirms 'B' CCR on Merger Agreement --------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its ratings on Houston-based Sabine Oil & Gas LLC ratings, including the 'B' corporate credit rating. The outlook is stable. The rating action reflects S&P's assessment of Sabine's improved scale of proved oil and gas reserves following the merger with Forest Oil Corp. in an all-stock transaction and the expectation that financial leverage will remain well above 4x debt to EBITDA. The companies have complementary acreage primarily in the Eagle Ford formation in south Texas and Cotton Valley formation in East Texas. S&P expects Sabine to develop its combined acreage and increase oil and gas production, resulting in higher operating cash flow. However, S&P forecasts that the company will outspend internally generated funds through 2015. The ratings on Sabine reflect S&P's view of the company's "weak" business risk and "highly leveraged" financial risk. The stable outlook reflects S&P's expectation that leverage will remain about 4.5x over the next year. S&P could consider a downgrade if Sabine encounters operating disruptions with its comingled assets that cause the combined company's production output and cash flow generation to fall meaningfully below our expectations such that it faced constrained liquidity or if it increased debt-funded capital spending, resulting in total debt to EBITDA exceeding 5x with no clear path to improvement. S&P would consider an upgrade if Sabine were to achieve its growth objectives while maintaining leverage in the 4x area or lower on a sustained basis, manage capital spending closer to its operating cash flows, and maintain adequate liquidity. Leverage could also be reduced if the company uses funds from asset sales to repay debt. SARKIS INVESTMENTS: Hires GA Keen as Real Estate Broker ------------------------------------------------------- Sarkis Investments Company, LLC asks for permission from the Hon. Robert N. Kwan of the U.S. Bankruptcy Court for the Central District of California to employ GA Keen Realty Advisors, LLC as real estate broker, effective Apr. 15, 2014. Per terms of the Retention Agreement, GA Keen will have the exclusive right to offer the Properties, located at 3550 Porsche Way, 3640 Porsche Way, 3660 Porsche Way, 3700 Inland Empire Boulevard, and 3760 Inland Empire Boulevard, Ontario CA 91764 (collectively, the "Property"), for sale for a term of six months, from Apr. 15, 2014 to Oct. 15, 2014. The Debtor requires GA Keen to: (a) evaluate the value and marketability of the Property; (b) list the Property for sale; (c) market and advertise the Property for sale; (d) communicate with parties interested in viewing and offering to purchase the Property; (e) show the Property to potential buyers; (f) negotiate the terms of any agreement or other documentation pertaining to the acquisition of the Property in concert with the Debtor's counsel; (g) cooperate with Debtor in seeking Court approval of any proposed sale of the Property; and (h) provide any other services reasonably requested by the Debtor necessary to effectively market and consummate the sale of the Property. As provided in the retention agreement, the Debtor will provide $27,000 advance to GA Keen for marketing expenses associated with the listing and advertising the Property (the "Marketing Advance"). The retention agreement is subject to Court approval; GA Keen will receive a full and complete compensation for its services to the estate an amount equal to 1.25% of the total gross consideration paid for the Property. GA Keen's compensation is contingent on the sale of the Property and Court approval. Mark P. Naughton, senior vice president and general counsel of Great American Group, the parent company of GA Keen, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. GA Keen can be reached at: Harold Bordwin GA KEEN REALTY ADVISORS, LLC Graybar Building 420 Lexington Avenue, Suite 3001 New York, NY 10170 Tel: (646) 381-9201 E-mail: hbordwin@greatamerican.com About Sarkis Investments Company, LLC Sarkis Investments Company, LLC, filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 13-29180) on July 29, 2013. Sarkis owns and leases several parcels of commercial real property in Ontario, California: 3550 Porsche Way; 3640 Porsche Way; 3660 Porsche Way; 3700 Inland Empire Blvd; and 3760 Inland Empire Blvd. Judge Robert Kwan presides over the case. Pamela Muir signed the petition as manager. The Debtor estimated assets and debts of at least $10 million. Ashley M. McDow, Esq., at Baker & Hostetler, LLP, serves as the Debtor's counsel. Patrick Galentine was appointed by a state court as receiver for the Debtor's assets. The receiver is represented by Reed Waddell, Esq., at Frandzel Robins Bloom & Csato, LC. MSCI 2007-IQ13 Ontario Retail Limited Partnership, which initiated the receivership proceedings against Sarkis in state court, is represented by Ron Oliner, Esq., at Duane Morris LLP. In April 2014, the Debtor filed a Second Amended Reorganization Plan and disclosure statement. The Debtors seeks to accomplish payments under the plan by paying creditors on account of their allowed claims in full over time from cash flows generated from future operations or the proceeds from the sale of the Company or the properties. SARKIS INVESTMENT: Receiver Hires Frandzel Robins as Counsel ------------------------------------------------------------ Patrick Galentine, the Receiver over real property of Sarkis Investment Company, LLC, seeks authorization from the U.S. Bankruptcy Court for the Central District of California to employ Frandzel Robins Bloom & Csato, L.C. ("FRBC") as bankruptcy counsel, nunc pro tunc to Aug. 1, 2013. FRBC will advise and represent the Receiver with respect to his rights and duties in the bankruptcy case under applicable law, including with respect to the Debtor, creditors, and his management of the Property. FRBC will be paid at these hourly rates: 2013 Rate 2014 Rate --------- --------- Craig A. Welin $430 $450 Reed S. Waddell $410 $425 Christopher D. Crowell -- $295 FRBC will also be reimbursed for reasonable out-of-pocket expenses incurred. Through Feb. 28, 2014, FRBC incurred $11,291 in fees and $1,487.95 in costs. Reed S. Waddell, "of Counsel" of FRBC, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. FRBC can be reached at: Reed S. Waddell, Esq. FRANDZEL ROBINS BLOOM & CSATO, L.C. 6500 Wilshire Blvd., 17th Floor Los Angeles, CA 90048-4920 Tel: (323) 852-1000 Fax: (323) 651-2577 About Sarkis Investments Company, LLC Sarkis Investments Company, LLC, filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 13-29180) on July 29, 2013. Sarkis owns and leases several parcels of commercial real property in Ontario, California: 3550 Porsche Way; 3640 Porsche Way; 3660 Porsche Way; 3700 Inland Empire Blvd; and 3760 Inland Empire Blvd. Judge Robert Kwan presides over the case. Pamela Muir signed the petition as manager. The Debtor estimated assets and debts of at least $10 million. Ashley M. McDow, Esq., at Baker & Hostetler, LLP, serves as the Debtor's counsel. Patrick Galentine was appointed by a state court as receiver for the Debtor's assets. The receiver is represented by Reed Waddell, Esq., at Frandzel Robins Bloom & Csato, LC. MSCI 2007-IQ13 Ontario Retail Limited Partnership, which initiated the receivership proceedings against Sarkis in state court, is represented by Ron Oliner, Esq., at Duane Morris LLP. In April 2014, the Debtor filed a Second Amended Reorganization Plan and disclosure statement. The Debtors seeks to accomplish payments under the plan by paying creditors on account of their allowed claims in full over time from cash flows generated from future operations or the proceeds from the sale of the Company or the properties. SERVICEMASTER CO: S&P Assigns B- CCR & Puts Rating on Watch Pos. ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned a 'B-' corporate credit rating to Memphis-based The ServiceMaster Co. LLC, and put the rating on CreditWatch with positive implications. The surviving company is assuming the debt of the pre-spin-off entity, The ServiceMaster Co. Accordingly, S&P is placing its 'B' issue-level ratings on ServiceMaster's senior secured revolving credit and term facilities on CreditWatch with positive implications. S&P's recovery ratings on these facilities are '2', indicating S&P's expectation of substantial (70% to 90%) recovery for lenders in the event of a payment default. In addition, S&P placed its 'CCC+' issue-level rating on the company's senior unsecured notes on CreditWatch with positive implications. S&P's recovery rating on these notes is '5', indicating its expectation for modest (10% to 30%) recovery for lenders in the event of a payment default. "The CreditWatch placement reflects our view that, based on recent public filings, the company is planning to recapitalize following the spin-off of its TruGreen business earlier this year," said Standard & Poor's credit analyst Linda Phelps. "In particular, the company plans to raise new equity through an initial public offering. We anticipate proceeds from the offering will be used to reduce currently high debt levels." The CreditWatch placement with positive implications reflects Standard & Poor's view that it could raise or affirm the rating. In particular, S&P could raise its ratings if an IPO is completed and it believes leverage will be sustainable in the 7x area. Alternatively, S&P could affirm its ratings if an initial public offering is not completed and credit measures remain at currently very weak levels. S&P will resolve the CreditWatch listing for ServiceMaster once it has greater clarity regarding the the capital structure post- transaction. S&P's review will also focus on the company's business strategy and financial policy post-transaction. SGK VENTURES: Seeks Approval of Hilco as Real Estate Broker ----------------------------------------------------------- SGK Ventures LLC, aka Keywell LLC, asks the U.S. Bankruptcy Court for the Northern District of Illinois for permission to employ Hilco Real Estate LLC as its real estate broker in connection with the marketing and sale of real property recorded as Parcel #09372003E (Goldmine Property) in Union County, North Carolina. The Debtor notes the Goldmine Property consists of approximately 24 acres of undeveloped land in the Monroe, North Carolina vicinity. The Goldmine Property is located approximately 25 miles outside of Charlotte, North Carolina. The firm will be paid in this manner: a) Commission: Upon the closing to a purchaser from whom the Broker obtained a bid, and subject to Court approval, the Broker shall be entitled to a commission of 6% of the gross selling price, inclusive of the fees of the cooperating broker, if any, and subject to a minimum commission of $30,000 if a sale is completed. b) Expenses: Subject to the Debtor's prior approval, Hilco shall be reimbursed for reasonable and customary out-of-pocket expenses incurred in connection with its services, subject to a cap of $5,000. The Debtor says it will pay the broker up to $5,000 in "Reimbursable Expenses". The Debtor assures the Court that the firm is "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Hilco Real can be reached at: Hilco Real Estate LLC 5 Revere Dr., Suite 320 Northbrook, IL 60062 Tel: 847-714-1288 Fax: 847-714-1289 Website: http://www.hilcorealestate.com/ About Keywell L.L.C. Keywell L.L.C., a supplier of scrap titanium and stainless steel, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 13-37603) on Sept. 24, 2013. Mark Lozier signed the petition as president and CEO. Keywell LLC first filed schedules disclosing $22,515,017 in total assets, and $35,025,633 in total liabilities. In its amended schedules, Keywell disclosed $22,546,386 in total assets and $39,361,793 in total liabilities. Judge Eugene R. Wedoff presides over the case. Howard L. Adelman, Esq., Chad H. Gettleman, Esq., Henry B. Merens, Esq., Brad A. Berish, Esq., Mark A. Carter, Esq., Adam P. Silverman, Esq., and Nathan Q. Rugg, Esq., at Adelman & Gettleman Ltd. serve as the Debtor's counsel. Alan B. Patzik, Esq., Steven M. Prebish, Esq., and David J. Schwartz, Esq., at Patzik, Frank & Samotny Ltd. serve as the Debtor's special counsel. Eureka Capital Markets, LLC, serves as the Debtor's investment banker, while Conway MacKenzie, Inc., serves as its financial advisors. The Debtor's lenders are represented by Steven B. Towbin, Esq., and Gordon E. Gouveia, Esq., at Shaw Fishman Glantz & Towbin LLC, in Chicago, Illinois. The United States Trustee for Region 11 appointed an Official Committee of Unsecured Creditors. The panel has hired David A. Agay, Esq., Sean D. Malloy, Esq., Scott N. Opincar, Esq., Joshua A. Gadharf, Esq., and T. Daniel Reynolds, Esq., at McDonald Hopkins LLC as counsel. Alvarez & Marsal North America, LLC, serves as financial advisors to the Committee. In December 2013, the Bankruptcy Court formally approved the sale of the Debtor's assets to KW Metals Acquisition LLC for $15.8 million. The original offer was from Cronimet Holdings Inc. for $12.5 million cash. Keywell LLC changed its name and case caption to "SGK Ventures, LLC" following the sale. SGK VENTURES: Can Access NewKey's Cash Collateral Until Aug. 29 --------------------------------------------------------------- The Hon. Eugene R. Wedoff of the U.S. Bankruptcy Court for the Northern District of Illinois issued a final order authorizing SGK Ventures LLC, aka Keywell LLC, to use cash collateral of NewKey Group LLC and NewKey Group II LLC until Aug. 29, 2014, pursuant to the budget. A full-text copy of the cash collateral budget is available for free at http://is.gd/SEhmku As reported by the Troubled Company Reporter in October 2013, the Debtor, as of the Petition Date, owed $4,553,320, with interest continuing to accrue to NewKey; and $5,942,742 with interest continuing to accrue to NewKey II. The Debtor is authorized to use cash collateral to pay a $175,000 settlement payment to Wells Fargo; provided, however, that the amount will be restored as cash collateral from unencumbered sale proceeds received at the closing, which was scheduled for Dec. 31, 2013. Consulting Deal With Sheffieck Rejected In March 2014, the Hon. Eugene R. Wedoff denied the Debtor's request to enter into a consulting agreement of Michael C. Sheffieck, chief financial officer of KW Metals Acquisition LLC nka Keywell Metals LLC. Keywell Metals bought the Debtors' substantially all of its assets on Dec. 31, 2013. In its motion, the Debtor said Mr. Sheffieck possesses substantial information regarding the business and financial affairs of the Debtor. The CRO has determined that he may need to call upon Mr. Sheffieck's extensive knowledge of the Debtor from time to time in order to fulfill his duties, maximize value of the Debtor's estate and assist the Debtor in bringing this Chapter 11 Case to its conclusion. The Debtor proposed to pay Mr. Sheffieck at an hourly rate of $350. In addition to compensation for services rendered, Mr. Sheffieck will seek reimbursement for reasonable and necessary expenses incurred with his engagement in the Chapter 11 Case, the Debtor noted. About Keywell L.L.C. Keywell L.L.C., a supplier of scrap titanium and stainless steel, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 13-37603) on Sept. 24, 2013. Mark Lozier signed the petition as president and CEO. Keywell LLC first filed schedules disclosing $22,515,017 in total assets, and $35,025,633 in total liabilities. In its amended schedules, Keywell disclosed $22,546,386 in total assets and $39,361,793 in total liabilities. Judge Eugene R. Wedoff presides over the case. Howard L. Adelman, Esq., Chad H. Gettleman, Esq., Henry B. Merens, Esq., Brad A. Berish, Esq., Mark A. Carter, Esq., Adam P. Silverman, Esq., and Nathan Q. Rugg, Esq., at Adelman & Gettleman Ltd. serve as the Debtor's counsel. Alan B. Patzik, Esq., Steven M. Prebish, Esq., and David J. Schwartz, Esq., at Patzik, Frank & Samotny Ltd. serve as the Debtor's special counsel. Eureka Capital Markets, LLC, serves as the Debtor's investment banker, while Conway MacKenzie, Inc., serves as its financial advisors. The Debtor's lenders are represented by Steven B. Towbin, Esq., and Gordon E. Gouveia, Esq., at Shaw Fishman Glantz & Towbin LLC, in Chicago, Illinois. The United States Trustee for Region 11 appointed an Official Committee of Unsecured Creditors. The panel has hired David A. Agay, Esq., Sean D. Malloy, Esq., Scott N. Opincar, Esq., Joshua A. Gadharf, Esq., and T. Daniel Reynolds, Esq., at McDonald Hopkins LLC as counsel. Alvarez & Marsal North America, LLC, serves as financial advisors to the Committee. In December 2013, the Bankruptcy Court formally approved the sale of the Debtor's assets to KW Metals Acquisition LLC for $15.8 million. The original offer was from Cronimet Holdings Inc. for $12.5 million cash. Keywell LLC changed its name and case caption to "SGK Ventures, LLC" following the sale. SGK VENTURES: Files Amended Schedules of Assets and Liabilities --------------------------------------------------------------- SGK Ventures LLC, aka Keywell LLC, filed an amended summary of schedules of assets and liabilities in the U.S. Bankruptcy Court for the Northern District of Illinois, disclosing assets of $22,602,974 and liabilities of $37,181,354. A full-text copy of the schedules is available for free at http://is.gd/XlF4am About Keywell L.L.C. Keywell L.L.C., a supplier of scrap titanium and stainless steel, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 13-37603) on Sept. 24, 2013. Mark Lozier signed the petition as president and CEO. Keywell LLC first filed schedules disclosing $22,515,017 in total assets, and $35,025,633 in total liabilities. In its amended schedules, Keywell disclosed $22,546,386 in total assets and $39,361,793 in total liabilities. Judge Eugene R. Wedoff presides over the case. Howard L. Adelman, Esq., Chad H. Gettleman, Esq., Henry B. Merens, Esq., Brad A. Berish, Esq., Mark A. Carter, Esq., Adam P. Silverman, Esq., and Nathan Q. Rugg, Esq., at Adelman & Gettleman Ltd. serve as the Debtor's counsel. Alan B. Patzik, Esq., Steven M. Prebish, Esq., and David J. Schwartz, Esq., at Patzik, Frank & Samotny Ltd. serve as the Debtor's special counsel. Eureka Capital Markets, LLC, serves as the Debtor's investment banker, while Conway MacKenzie, Inc., serves as its financial advisors. The Debtor's lenders are represented by Steven B. Towbin, Esq., and Gordon E. Gouveia, Esq., at Shaw Fishman Glantz & Towbin LLC, in Chicago, Illinois. The United States Trustee for Region 11 appointed an Official Committee of Unsecured Creditors. The panel has hired David A. Agay, Esq., Sean D. Malloy, Esq., Scott N. Opincar, Esq., Joshua A. Gadharf, Esq., and T. Daniel Reynolds, Esq., at McDonald Hopkins LLC as counsel. Alvarez & Marsal North America, LLC, serves as financial advisors to the Committee. In December 2013, the Bankruptcy Court formally approved the sale of the Debtor's assets to KW Metals Acquisition LLC for $15.8 million. The original offer was from Cronimet Holdings Inc. for $12.5 million cash. Keywell LLC changed its name and case caption to "SGK Ventures, LLC" following the sale. SHEA HILLS: Vacant Land to Be Auctioned Off May 22 -------------------------------------------------- Assets of Shea Hills Developments, Ltd., will be sold at public auction to the highest bidder, at the law offices of Quarles & Brady LLP, in Phoenix, Arizona, on May 22, 2014 at 10:00 A.M. The sale will be made for cash or other form satisfactory to Quarles & Brady, which serves as Trustee for the assets. The assets to be sold consist of vacant land Intersection of Shea Blvd. and Palatial Drive Fountain Hills, Arizona The assets serve as collateral for debt under a Promissory Note in the original principal balance of $187,000 owed to West Coast Fund, LLC. The Trustee may be reached at: Michael S. Catlett, Esq. QUARLES & BRADY LLP Renaissance One Two North Central Avenue Phoenix, AZ 85004-2391 Telephone: 602-229-5200 E-mail: elizabeth.hibbs@quarles.com SI ORGANIZATION: S&P Assigns 'CCC+' Rating to $140MM Loan --------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'CCC+' issue-level rating and '6' recovery rating to The SI Organization Inc.'s (The SI) $140 million second-lien term loan. The '6' recovery rating indicates S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. At the same time, S&P raised the issue-level rating on The SI's $400 million first-lien credit facility to 'B+' from 'B' and revised the recovery rating to '2' from '3'. This facility consists of a $50 million revolver and a $350 million first-lien term loan. The '2' recovery rating indicates S&P's expectation for substantial (70% to 90%) recovery in the event of a payment default. The first-lien term loan amount was revised to $350 million from the previously proposed $490 million. S&P's 'B' corporate credit rating and stable outlook on The SI remain unchanged. RATINGS LIST Ratings Unchanged The SI Organization Inc. Corporate Credit Rating B/Stable/-- Senior Secured B+ Recovery Rating 2 New Rating The SI Organization Inc. $140 mil. 2nd lien term loan due 2020 Senior Secured CCC+ Recovery Rating 6 Upgraded; Recovery Rating Revised The SI Organization Inc. To From Senior Secured US$50 mil revolving bank ln due 2019 B+ B Recovery Rating 2 3 US$350 mil term bank ln due 2020 B+ B Recovery Rating 2 3 SKYLINE MANOR: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Skyline Manor, Inc. 7350 Graceland Drive Omaha, NE 68134 Case No.: 14-80934 Chapter 11 Petition Date: May 8, 2014 Court: United States Bankruptcy Court District of Nebraska (Omaha Office) Judge: Hon. Thomas L. Saladino Debtor's Counsel: Patrick Raymond Turner, Esq. STINSON LEONARD STREET LLP 1299 Farnam Street, Suite 1500 Omaha, NE 68102 Tel: (402) 342-1700 Fax: (402) 829-8736 Email: patrick.turner@stinsonleonard.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by John W. Bartle, chief restructuring officer. List of Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Cerner HealthCare $24,573 David Hogan $15,500 Estate of Arlene Slater $11,100 Fred's Lawn Service $29,849 Gulf South Medical $31,392 Health MEDX $17,931 Host Coffee $11,390 Hy-Vee $46,613 Joyce Maureen Greenwell $13,545 Marcus & Millichap Real Estate $180,000 Margaret Carlson $27,575 Medova HealthCare $30,312 Mrs. Dorothy Menck $17,600 Omnicare of Nebraska $360,485 c/o Shilee Mullin 12925 West Dodge Road Suite 107 Omaha, NE 68154 OPPD $167,710 Pharmerica $100,416 RehabCare Group East $273,544 c/o Victoria Butler, Kutak Rock, LLP 1650 Farnam Street Omaha, NE 68102 Shannon Sales $16,650 Sysco $168,016 TruGreen Limited $12,760 SKYLINE RIDGE: Assets to Be Auctioned Off May 28 ------------------------------------------------ Craig K. Williams, Esq., as agent for The Northern Trust Company, successor by merger to Northern Trust, NA, will sell real and personal property of Skyline Ridge, L.L.C. to the highest qualified bidder in public on May 28, 2014, at 1:30 p.m. The auction will be held at the Law offices of Snell &, Wilmer L.L.P., One South Church Avenue, Suite 1500, Tucson, Arizona. Assets to be sold include: -- All that portion of the West half of G.L.O. Lot 2 of Section 14, Township 13 South, Range 14 East, Gila and Salt River Base and Meridian, Pima County, Arizona, -- a parcel of land situated in Government Lot 3 of the North half of Section 14, Township 13 South, Range 14 East, Gila and Salt River Base and Meridian, in Pima County, -- Lot 19, of EL DIAMANTE II, in Pima County, Arizona, -- Lots 2 and 12, of LA MIRADA AT LA RESERVE, in Pima County, -- The East 127.5 feet of the West 330 feet of the South 75 feet of Lot 1, of CATALINA SUBDIVISION NO. 2, in Pima County, -- Lot 76, of SABINO TOWN AND COUNTRY ESTATES, in Pima County, -- Lots 13 and 14, of FRANCE TERRACE TOWNHOMES, in Pima County, -- Lots 9 and 10, of ALTA VISTA VILLAGE II, in Pima County, -- Lot 12, of COBBLESTONE, in Pima County, and -- All that portion of the West half of the West half of G.L.O. Lot 2, Section 14, Township 13 South, Range 14 East, Gila and Salt River Base and Meridian, Pima County To qualify to bid at the public sale, each person must qualify with the Agent on or before the sale date by providing name, address, phone number, and a $10,000.00 deposit, in cash or cashier's check, made payable to Agent. The successful bidder shall have until 5:00 p.m. (Arizona time) on the following business day (presently May 29, 2014) to pay the entire purchase price at the public sale, less the $10,000.00 deposit previously held by Agent, in a form acceptable to Agent. If the successful bidder does not complete the payment in full of the purchase price by 5:00 p.m. (Arizona time) on the next business day (presently May 29,2014), then Agent shall have the right to retain the $10,000.00 deposit to offset fees, costs and expenses of Secured Party. In such event, and at Secured Party's election, Agent shall either sell the property to the next highest bidder, or hold a subsequent public sale, notifying all parties who had registered in writing with Agent on the date of the original sale, setting forth the time and place of the subsequent public sale. The Secured Party may be reached at: The Northern Trust Company, fka Northern Trust, NA 3450 East Sunrise Drive, Ste. 100 Tucson, AZ 85718 Skyline Ridge may be reached through: Skyline Ridge, L.LC. Michael J. Vingelli, Esq. Statutory Agent 33 North Stone Avenue, Ste. 1800 Tucson, AZ 85701 Among the parties that have been notified of the foreclosure sale are: 1. Ahmad Zarifi 3400 East Finger Road Circle Tucson, AZ 85718 2. Skyline Country Club Estates Improvement Association c/o Tanis A. Duncan, Attorney 548 East Speedway Tucson, AZ 85705-7478 3. The La Reserve Community Association 7493 North Oracle Rd., Ste. 125 Tucson, AZ 85704 4. Sabino Town & Country Estates P. O. Box 31234 Tucson, AZ 85751-1234 5. France Terrace Townhomes, Inc. c/o Managing Agent: Gail Wikel 4703 North First Avenue Tucson, AZ 85718 Isaac D. Rothschild, Esq. Mesch, Clark & Rothschild P.C. 259 N. Meyer Ave. Tucson, AZ 85701-1090 6. Skyline Country Club Estates Improvement Association c/o Carolyn B. Goldschmidt Monroe McDonough Goldschmidt & Molla PLLC 4578 North First Blvd., Ste. 160 Tucson, AZ 85718 SPECIALTY PRODUCTS: Proposes Asbestos Claimant Notification Plan ---------------------------------------------------------------- Law360 reported that Specialty Products Holding Corp. asked a Delaware bankruptcy judge to sign off on a $3.2 million program designed to alert those exposed to its former asbestos-containing products of the upcoming deadline to file claims in the company's Chapter 11 case. According to the report, bankrupt Specialty Products faces an estimated $1.1 billion in asbestos-related liability, and approval of the proposed bar date notice plan would take the company a step closer to its stated goal of establishing a trust to deal with such claims. U.S. Bankruptcy Judge Peter J. Walsh ruled in February that all Specialty Products creditors must file proofs of claim by a set deadline, overruling objections that potential asbestos-related personal injury claimants should be exempted from a bar date, the report related. At the same hearing, Judge Walsh directed the debtor to retool its proposed plan for getting the word out about the bar date, taking up the argument of the committee of asbestos personal injury claimants that the suggested notice provisions were deficient, the report further related. Specialty Products says the new plan -- designed by The Garden City Group Inc., its claim notice consultant -- is more expansive and contains a clearer message than the previous version, the report added. About Specialty Products Cleveland, Ohio-based Specialty Products Holdings Corp., aka RPM, Inc., is a wholly owned subsidiary of RPM International Inc. The Company is the holding company parent of Bondex International, Inc., and the direct or indirect parent of certain additional domestic and foreign subsidiaries. The Company claims to be a leading manufacturer, distributor and seller of various specialty chemical product lines, including exterior insulating finishing systems, powder coatings, fluorescent colorants and pigments, cleaning and protection products, fuel additives, wood treatments and coatings and sealants, in both the industrial and consumer markets. The Company filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 10-11780) on May 31, 2010. Gregory M. Gordon, Esq., Dan B. Prieto, Esq., and Robert J. Jud, Esq., at Jones Day, serve as bankruptcy counsel. Daniel J. DeFranceschi, Esq., Zachary I. Shapiro, Esq., Paul N. Heath, Esq., and Tyler D. Semmelman, Esq., at Richards Layton & Finger, serve as co-counsel. Logan and Company is the Company's claims and notice agent. The Company estimated its assets and debts at $100 million to $500 million. The Company's affiliate, Bondex International, Inc., filed a separate Chapter 11 petition on May 31, 2010 (Case No. 10-11779), estimating its assets and debts at $100 million to $500 million. Counsel to the Official Committee of Asbestos PI Claimants are Natalie D. Ramsey, Esq., and Mark A. Fink, Esq. of Montgomery, Mccracken, Walker & Rhoads, LLP, in Wilmington Delaware, and Mark B. Sheppard, Esq. of the firm's Philadelphia, Pennsylvania division. Counsel to the Future Claimants' Representative are James L. Patton, Jr., Esq., Edwin J. Harron, Esq., Edmon Morton, Esq., Sharon Zieg, Esq., and Erin Edwards, Esq. of Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware. Competing bankruptcy exit plans have been filed by the Debtors, on one hand, and the Official Committee of Unsecured Creditors and the Future Claimants' Representative on the other. The Debtors' First Amended Joint Plan of Reorganization and the explanatory Disclosure Statement, dated Nov. 18, 2013, provides for an asbestos trust to be established and funded with cash to pay present and future asbestos-related claims. The trust will be funded by secured notes, issued by the Debtors and their ultimate parent, RPM International Inc. ("International"), and the amounts and terms of the notes will, with one exception, be determined by the final outcome or settlement of the litigation that will determine the asbestos claimants' rights in the chapter 11 cases. The one exception is that the notes will provide for an aggregate initial nonrefundable payment of $125 million to the asbestos trust irrespective of the outcome of any litigation. In short, the Debtors and International have committed to pay to asbestos claimants the maximum amount to which they are entitled based on the applicable judgments or rulings in the litigation that will determine the extent of the claimants' rights in the chapter 11 cases, and to make comparable payments to other similarly situated creditors. The PI Committee and the FCR's Third Amended Plan, filed Oct. 15, 2013, provides that: (i) SPHC will be separated from non-Debtor direct or indirect parent Bondex International; (ii) Reorganized SPHC will be managed and/or sold for the benefit of holders of all Claims that are not paid in Cash, subordinated, cancelled or otherwise treated pursuant to the Plan; (iii) all of SPHC's causes of action will survive; (iv) Asbestos PI Trust Claims against SPHC will be channeled to an Asbestos PI Trust; and (v) current SPHC equity interests will be canceled, annulled, and extinguished. On May 20, 2013, the Bankruptcy Court entered an order estimating the amount of the Debtors' asbestos liabilities, and a related memorandum opinion in support of the estimation order. The Bankruptcy Court estimated the current and future asbestos claims associated with Bondex International, Inc. and Specialty Products Holding at approximately $1.17 billion. The estimation hearing represents one step in the legal process in helping to determine the amount of potential funding for a 524(g) asbestos trust. STAR DYNAMICS: Judge Denies Womble Carlyle Fees ----------------------------------------------- Law360 reported that an Ohio federal judge denied a request by attorneys with Womble Carlyle Sandrige & Rice LLP for $155,725 in reimbursement for representing bankrupt defense contractor Star Dynamics Corp. in its ongoing Chapter 11 case. According to the report, U.S. Bankruptcy Judge Charles M. Caldwell said that an application to be repaid for work performed between Dec. 10 and Jan. 31 did not comply with the U.S. Bankruptcy Code and other rules of procedure because of an error was not served to all appropriate parties. In the two-page order denying the motion, the court said the firm's application "does not show service upon the required parties, or reflects service upon an incorrect party," and specifically lists attorneys David E. Gordon and Gary W. Marsh as having been omitted from the application, the report related. Gordon and Marsh are attorneys for Exelis Inc., a creditor in the case, according to court records, the report further related. Womble Carlyle has been representing Star Dynamics in the case since Jan. 14, when the court approved an order allowing the company to employ the firm as its special counsel, the report added. The firm filed for the reimbursement April 10, saying the work they performed was "at rates and in accordance with practices no less favorable to Debtor's estate than those customarily employed by WCSR generally." About STAR Dynamics STAR Dynamics Corp. develops, sales, and services instrumentation radar systems for missile test ranges utilized by the United States and foreign governments. Located principally in Hilliard, Ohio, with satellite offices in Herndon, Virginia and Sandestin Florida, it has 112 full-time employees. STAR Dynamics filed a petition for Chapter 11 protection (Bankr. S.D. Ohio Case No. 13-59657) on Dec. 10, 2013, in Columbus, Ohio, in part to halt a lawsuit by BAE Systems Plc. According to its first-day motions and as of Nov. 30, 2013, it has assets of $28,470,788.13, liabilities of $50,892,360.12 and gross sales of $8,140,140.93. In its schedules, the Debtor listed $12,138,334 in total assets and $50,740,343 in total liabilities. BAE is an American subsidiary of a global-level defense contractor based in Great Britain, with more than 50,000 employees world- wide. BAE has its headquarters in Arlington, Virginia, and like the Debtor, is engaged in the radar range business for the testing of missiles and other weaponry. Bankruptcy Judge Charles M. Caldwell oversees the case. Thomas R. Allen, Esq., Richard K. Stovall, Esq., and Erin L. Pfefferle, Esq., at Allen Kuehnle Stovall & Neuman LLP serve as the Debtor's bankruptcy counsel. Michael J. Sullivan, Esq., Russell A. Williams, Esq., Julie E. Adkins, Esq., Louis T. Isaf, Esq., and Nanda K. Alapati, Esq., at Womble Carlyle Sandridge & Rice LLP, serve as special counsel with respect to litigation involving BAE Systems and with respect to the completion of prepetition patent work. Sagent Advisors LLC serves as financial advisor. SUNTECH POWER: Solyndra & ECD Trusts Balk at Chapter 15 Petition ---------------------------------------------------------------- Solyndra Residual Trust, together with Energy Conversion Devices Residual Trust, filed an objection to the request for entry of an order recognizing the provisional liquidation proceeding of Suntech Power Holdings Co. Ltd. pending before the Grand Court of the Cayman Islands. Solyndra Residual asks the U.S. Bankruptcy Court for the Southern District of New York to transfer the venue of Suntech's Chapter 15 Petition to the U.S. District Court for the Northern District of California. Solyndra Residual argues that the Cayman Proceeding does not constitute a "foreign main proceeding" or a "foreign nonmain proceeding" under applicable law; as such, Suntech's Chapter 15 petition for recognition must be dismissed. According to Solyndra Residual, to qualify as a "foreign main proceeding," Suntech must prove that the Cayman Islands is Suntech's "center of main interests". Based solely on public information, the evidence shows that as of the commencement of the Cayman Proceeding: -- Suntech was headquartered in China; -- Suntech's (technically, those of its wholly-owned subsidiaries) manufacturing facilities were located in China; -- Suntech's website, while mentioning ties to China and the United States, said nothing about the Cayman Islands; -- Suntech's products (technically, those of its wholly-owned subsidiaries) were distributed and sold in the United States, Europe, and Asia; -- All of Suntech's operations were located outside of the Cayman Islands; -- All of Suntech's managers and employees resided outside of the Cayman Islands; -- All of Suntech's stock (NYSE) traded outside of the Cayman Islands; -- Cayman Islands law and Suntech's corporate charter expressly prohibited Suntech from engaging in any trade in the Cayman Islands except in furtherance of business conducted outside of the Cayman Islands; -- No significant disputes were pending in the Cayman Islands, with significant disputes pending in the Northern District of California, including litigation brought by shareholders, Solyndra, and others. -- All of Suntech's creditors, suppliers, and customers were located outside the Cayman Islands; -- All of Suntech's directors resided outside of the Cayman Islands; and -- All of Suntech's bank accounts were maintained in Hong Kong and China. Thus, although Suntech was registered in the Cayman Islands for tax purposes, and maintained its "registered office" there, as of the commencement of the Cayman Proceeding, the Cayman Islands did not constitute Suntech's COMI. Indeed, the facts show that Suntech had no commercial relationship to the Cayman Islands such that no creditor would have or should have reasonably expected to have claims adjudicated in the Cayman Islands, says Solyndra Residual. Solyndra Residual further argues that Suntech's attempt to obtain recognition of the Cayman Proceeding as a "foreign nonmain proceeding" is equally unavailing because Suntech cannot prove, as it must, that it has an "establishment" in the Cayman Islands. To qualify as an "establishment," Suntech must prove that it carries out "nontransitory economic activity" in the Cayman Islands. Suntech does not (and cannot) offer any such proof. Solyndra Residual is represented by: John A. Morris, Esq. Debra I. Grassgreen, Esq. Maxim B. Litvak, Esq. PACHULSKI STANG ZIEHL & JONES LLP 780 Third Avenue, 36th Floor New York, NY 10017 Tel: (212) 561-7700 Fax: (212) 561-7777 E-mail: jmorris@pszjlaw.com dgrassgreen@pszjlaw.com mlitvak@pszjlaw.com - and - Eric E. Sagerman, Esq. W. Gordon Dobie, Esq. Justin E. Rawlins, Esq. William C. O'Neil, Esq. WINSTON & STRAWN LLP 333 S. Grand Avenue Los Angeles, CA 90071 Telephone: (213) 615-1700 Facsimile: (213) 615-1750 E-mail: esagerman@winston.com wdobie@winston.com jrawlins@winston.com woneil@winston.com The Energy Conversion Devices Trust is represented by: Carey D. Schreiber, Esq. WINSTON & STRAWN LLP 200 Park Avenue New York, NY 10166 Tel: (212) 294-6700 Fax: (212) 294-4700 Email: cschreiber@winston.com - and - Eric E. Sagerman, Esq. Justin E. Rawlins, Esq. WINSTON & STRAWN LLP 333 S. Grand Avenue Los Angeles, CA 90071 Tel: (213) 615-1700 Fax: (213) 615-1750 - and - W. Gordon Dobie, Esq. William C. O'Neil WINSTON & STRAWN LLP 35 W. Wacker Drive Chicago, IL 60601-9703 Tel: (312) 558-5600 Fax: (312) 558-5700 About Suntech Wuxi, China-based Suntech Power Holdings Co., Ltd., produces solar products for residential, commercial, industrial, and utility applications. Suntech has delivered more than 25,000,000 photovoltaic panels to over a thousand customers in more than 80 countries. Suntech Power Holdings Co., Ltd., received from the trustee of its 3 percent Convertible Notes a notice of default and acceleration relating to Suntech's non-payment of the principal amount of US$541 million that was due to holders of the Notes on March 15, 2013. That event of default has also triggered cross-defaults under Suntech's other outstanding debt, including its loans from International Finance Corporation and Chinese domestic lenders. Suntech Power had involuntary Chapter 7 bankruptcy proceedings initiated against it on Oct. 14, 2013, in U.S. Bankruptcy Court in White Plains, New York (Bankr. S.D.N.Y. Case No. 13-bk-13350), by holders of more than $1.5 million of defaulted securities under a 2008 $575 million indenture. The Chapter 7 Petitioners are Trondheim Capital Partners, L.P., Michael Meixler, Longball Holdings, LLC, and Jiangsu Liquidators, LLC. They are represented by Jay Teitelbaum, Esq., at Teitelbaum & Baskin LLP, in White Plains, New York. Suntech Power on Jan. 31, 2014, disclosed that it has signed a Restructuring Support Agreement relating to the petition for involuntary bankruptcy filed against it under chapter 7 of the U.S. Bankruptcy Code. Under the RSA, the parties agreed that chapter 7 proceedings will be dismissed following recognition of the provisional liquidation proceeding previously filed by the Company in the Cayman Islands under chapter 15 of the U.S. Bankruptcy Code. On Feb. 21, 2014, David Walker and Ian Stokoe, the joint provisional liquidators of Suntech Power Holdings Co., Ltd., appointed by the Grand Court of the Cayman Islands, commenced a Chapter 15 proceeding (Bankr. S.D.N.Y. Case No. 14-10383). The Chapter 15 Petitioners are represented by Jennifer Taylor, Esq., and Diana Perez, Esq., at O'Melveny & Myers LLP. According to the Chapter 15 petition, Suntech has more than $1 billion in both assets and debts. TRIPLANET PARTNERS: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Triplanet Partners LLC aka Convergence 50 Main Street, Suite 1000 White Plains, NY 10606 Case No.: 14-22643 Type of Business: An international management consultancy to the financial services industry that delivers expert solutions in business performance and transformation across the Finance, Risk, Treasury and Technology functions. Chapter 11 Petition Date: May 8, 2014 Court: United States Bankruptcy Court Southern District of New York (White Plains) Judge: Robert D. Drain Debtor's Counsel: Arnold Mitchell Greene, Esq. ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK, P.C. 875 Third Avenue, 9th Floor New York, NY 10022 Tel: (212) 603-6300 Fax: (212) 956-2164 Email: amg@robinsonbrog.com Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The petition was signed by Sophien Bennaceur, manager. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. VEYANCE TECHNOLOGIES: S&P Retains 'B' CCR on CreditWatch Positive ----------------------------------------------------------------- Standard & Poor's Ratings Services said its ratings on Fairlawn, Ohio-based rubber and plastics manufacturer Veyance Technologies Inc., including the 'B' corporate credit rating, remain on CreditWatch with positive implications, where S&P initially placed them on Feb. 11, 2014. The ratings remain on CreditWatch with positive implications because the proposed acquisition of Veyance Technologies Inc. by higher-rated Continental AG has yet to be completed, pending regulatory approval. S&P expects Veyance to repay or refinance outstanding rated debt as part of the transaction. The rating on Veyance reflects S&P's assessment of the company's business risk profile as "weak," characterized by its presence in competitive and cyclical markets, modestly offset by its well- established market position. S&P assess the company's financial risk profile as "highly leveraged," mainly because of its financial sponsor ownership and high debt levels. S&P expects the company will maintain "adequate" liquidity. The company is a global manufacturer of rubber and thermoplastic products serving mining, industrial, agricultural, and other end-markets. S&P plans to resolve the CreditWatch placement after the transaction closes. At that time, S&P could raise or withdraw the ratings on the company. VICTOR TECHNOLOGIES: Moody's Withdraws B2 Corporate Family Rating ----------------------------------------------------------------- Moody's Investors Service announced that it has withdrawn all ratings of Victor Technologies Group, Inc: Long Term Corporate Family Rating of B2 withdrawn Probability of Default Rating of B2-PD, withdrawn Ratings Under Review Outlook withdrawn $100MM Senior Secured Global Notes due 2017 rating of B2 withdrawn $227MM Senior Secured Global Notes due 2017 rating of B2 withdrawn Ratings Rationale Private equity firm Irving Place Capital and Victor Technologies announced on February 12, 2014 that they entered into an agreement to sell Victor to Colfax Corporation (Ba3), a global manufacturer of gas- and fluid-handling and fabrication technology products, for $947.3 million. The transaction was completed on April 14, 2014. Colfax funded the transaction through cash provided by an equity offering and through borrowings under its existing credit facility. WP MUSTANG: S&P Assigns 'B' CCR & Rates $495MM 1st Lien Loan 'B' ---------------------------------------------------------------- Standard & Poor's Rating Services said it assigned a 'B' corporate credit rating to Nashville, Tenn.-based WP Mustang Holdings LLC (known as Electronic Funds Source LLC). The outlook is stable. At the same time, S&P assigned a 'B' issue-level rating and '3' recovery rating to the company's $495 million first-lien term loan B due 2021 and $100 million first-lien revolving credit facility expiring 2019. The '3' recovery rating indicates S&P's expectation of meaningful (50%-70%) recovery in the event of payment default. S&P also assigned a 'CCC+' issue-level rating and '6' recovery rating to the company's $250 million second-lien term loan due 2022. The '6' recovery rating indicates S&P's expectation of negligible (0%-10%) recovery in the event of payment default. "We view EFS's business profile as 'fair,'" said Standard & Poor's credit analyst John Moore. The company, with about $152 million revenues for the 12 months ended March 31, 2014, competes as one of the largest U.S. fleet card providers serving the North American over-the-road trucking market, providing payment monitoring and control capabilities to its customers. S&P expects that EFS's integrated payment network and modular enterprise resource protocol system will continue to support the embedded nature of its solutions with its clients and its competitive differentiation, with modest client revenue attrition of about 1.5% per year. The company has strengthened its profitability over the past several years through significant acquisition-related growth, including its 2012 acquisition of T- Chek Systems Inc. for approximately $300 million. Over the coming year, S&P expects EFS's strong EBITDA margins will hold steady in the mid-50% range through new client accounts obtained over the past year and generally stable fuel pricing conditions. S&P regards the company's profitability as above average compared to that of its technology services sector peers. The outlook is stable, reflecting S&P's expectation that EFS will maintain its strong profitability, given its focused technology infrastructure investments made in recent years within its targeted U.S. trucking fuel card processing markets. S&P would consider lowering the rating if competitive pressures were to result in declining profitability and margin compression, causing adjusted leverage to exceed 9x on a sustained basis. An upgrade is unlikely over the intermediate term given the company's present high leverage and S&P's expectation that financial sponsor ownership will preclude sustained deleveraging. * "Resulting Trust" a Difficult Defense on Fraud Claim ------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that to beat a fraudulent transfer claim, resulting trusts are difficult to prove under South Carolina law, as shown by an opinion from the U.S. Court of Appeals in Richmond, Virginia. According to the report, a husband and wife purchased property in their joint names, intending at the time to lease the property to a corporation owned by the husband. The entire purchase price was paid with proceeds from a mortgage on which the couple were liable. From the time of the purchase forward, the corporation always paid the mortgage directly. Six years later and a few months before the wife's bankruptcy, the wife transferred her interest in the property to the corporation, the report related. The wife's trustee sued in bankruptcy court and won a judgment based on a constructive fraudulent transfer theory. Without rejecting any of the bankruptcy court's fact findings, the district court reversed, saying the facts showed a resulting trust, which would mean the corporation always was the beneficial owner of the property and thus didn't receive a fraudulent transfer when it came into title, the report further related. Circuit Judge Diana Gribbon Motz reversed the district court in an opinion focusing on the intricacies of South Carolina law on resulting trust, the report added. The law requires intent at the time of taking title that the record owner only have legal title, with the equitable interest in another party. In this case, the bankruptcy court found that the facts didn't support a resulting trust. The case is Anderson v. Architectural Glass Construction Inc. (In re Pfister), 12-2465, U.S. Court of Appeals for the Fourth Circuit (Richmond, Virginia). * Assets of Secondary Business Exempt as Tools of the Trade ----------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that a man could retain guns, two boats, a camper, an all- terrain vehicle, a utility trailer, a horse trailer and fishing equipment as tools of the trade in his secondary business as an outfitter, the U.S. Bankruptcy Appellate Panel in Denver said in an April 11 opinion. According to the report, the bankrupt in Chapter 7 worked full time in a grocery store. He claimed the vehicles and outdoor equipment were exempt assets as tools of the trade under Colorado law. The bankruptcy court allowed the exemption, and the trustee appealed, unsuccessfully, the report related. U.S. Bankruptcy Judge Sarah A. Hall, writing for the three-judge appellate panel, upheld the lower court, the report further related. She said the issue turned on whether having a secondary job as an outfitter amounted to a "gainful occupation" as required by the Colorado statute. Because he couldn't yet afford to quit his primary job, the bankrupt worked as an outfitter only during vacations and other days off, the report added. When the issue went to trial, the outfitting business was on the verge of being profitable. Although profitability is an element of "gainful," Hall said it wasn't controlling. The case is Larson v. Sharp (In re Sharp), 13-053, U.S. Bankruptcy Appellate Panel for the Tenth Circuit (Denver). * Barnes & Thornburg Nabs Akin Gump Appellate Pro ------------------------------------------------- Barnes & Thornburg LLP announced today that L. Rachel Lerman, Esq. -- Rachel.Lerman@btlaw.com -- has joined the firm's Litigation Department as a partner in the Los Angeles office. Previously, Lerman was a partner at Akin Gump Strauss Hauer & Feld LLP. Lerman focuses her practice on appellate and trial strategy in complex civil cases. She has handled more than 100 appeals in state and federal courts nationwide in a broad range of practice areas, including commercial litigation, bankruptcy, patent, trademark and trade secret law, insurance, white collar, and family law. "Rachel has a great deal of experience working with trial counsel and has more than 20 years of experience litigating complex matters and handling all aspects of state and federal appeals," said Bill McErlean, chair of the firm's Litigation Department. "Her arrival immediately strengthens our West Coast litigation capabilities and our national trial practice." "As our office continues to grow through the addition of impressive legal talent, we're pleased to welcome a practitioner of Rachel's caliber to the firm," added David Allen, managing partner of Barnes & Thornburg's Los Angeles office. The Los Angeles office currently has 31 attorneys who practice in a number of areas, including complex litigation, labor and employment, intellectual property and corporate matters. In addition, the group includes an Entertainment and Music practice that represents some of the most recognizable artists, brands and companies in the entertainment industry. The group has experience in the business needs of the advertising, film, live events, sports, music, technology, television and videogame industries. About L. Rachel Lerman Lerman has received numerous awards and honors, including selection to the Los Angeles Magazine "Super Lawyers" list every year from 2003-2014 and receipt of the ACLU's First Amendment Award in 2012. She is admitted to practice law in the state of California and before the U.S. Supreme Court, all federal Courts of Appeals, and the California District Courts. She previously clerked for the late Honorable T.G. Nelson for the Ninth Circuit Court of Appeals. Lerman is active on community and professional boards, including the executive board of the Constitutional Rights Foundation. She also is a member of the California Academy of Appellate Lawyers and the Los Angeles County Bar Association's Appellate Courts committee, and frequently volunteers as a mock trial judge and coach for college and high school students. Lerman earned her B.A. from Yale College, her M.A. and M.F.A. from Syracuse University, and her J.D. from University of California, Berkeley Boalt Hall School of Law. She advanced to doctoral candidacy at U.C. Berkeley in Jurisprudence & Social Policy. During law school, Lerman served as an editor for the Berkeley Women's Law Journal and was a Schurman Scholar for International & Comparative Law at the Universitaet Heidelberg in Heidelberg, Germany. * BofA Settles With FGIC over Second-Lien Mortgage Securities ------------------------------------------------------------- Christina Rexrode, writing for The Wall Street Journal, reported that Bank of America Corp. said that it settled mortgage-backed securities claims with the monoline insurer Financial Guaranty Insurance Co. The bank said it had settled seven of the nine trust settlements and expected to pay a total of about $950 million. The bank also said that the expenses were covered by legal reserves. According to the report, legal expenses pushed Bank of America to a first-quarter loss. The bank said it had a $6 billion litigation expense for the quarter, up from $2.2 billion in the same period a year ago, the report related. Of that, about $3.6 billion was related to the bank's settlement last month with the Federal Housing Finance Agency, where the bank agreed to pay some $9.5 billion to settle accusations that it had misled Fannie Mae and Freddie Mac about the quality of mortgage- backed securities it was selling, the report further related. The bank had previously estimated that the FHFA settlement would cut earnings by about $3.7 billion before taxes. The bank has now settled with four of the five monoline insurers that had sued the bank over mortgage-backed securities, the report added. * Carlton Fields Opens LA Office, Adds 2 Ex-Steptoe Attys --------------------------------------------------------- Carlton Fields Jorden Burt announced on April 16, 2014, that it has opened an office in Los Angeles, California. "We have substantial clients, cases, and transactions in California. So opening an office in Los Angeles is a natural progression of our growth," said Gary L. Sasso, President and CEO of Carlton Fields Jorden Burt. He added, "Our class action defense practice, in particular, has driven us into California, where many such cases are filed. We anticipate other synergies as well. California, Florida, and New York, for example, are international hubs, and they have strong financial services, real estate, technology, and health care and life sciences sectors." Carlton Fields Jorden Burt has a national practice in class action defense, high-stakes trial and appellate litigation, business transactions, regulatory representation, white collar defense, and government investigations serving key industries, including insurance, financial services, securities, health care, banking and consumer finance, real estate and commercial finance, construction, technology, and telecommunications. The firm also handles litigation and business transactions for international clients throughout the world. The firm's L.A. office will be led by Mark A. Neubauer. Eight years ago, Neubauer opened Steptoe & Johnson's Century City office and, as the office's managing partner, grew it to more than 35 attorneys. Three years ago, he was named national head of Steptoe's Commercial Litigation practice group, the third largest group in that firm. Neubauer also has previously served on Steptoe's Executive Committee. "Mark knows this market well, and he is extremely able", Sasso said. "We are confident he will help us establish and grow a strong presence in California." "Gary Sasso and I have been close friends for more than 20 years," Neubauer added. "The chance to work with him and the other great lawyers at Carlton Fields Jorden Burt was too attractive an opportunity to pass up. I have enjoyed my time with Steptoe a great deal and working with my wonderful colleagues there, but I am excited about the opportunity of taking on this new challenge." Neubauer focuses his practice on sophisticated litigation including commercial, securities, antitrust, real estate, employment, and entertainment. He has successfully tried numerous jury and bench cases in both state and federal courts during his 30-plus years of practice. Neubauer's legal skills have been repeatedly recognized. In 2010, his jury trial victory for Johnson & Johnson was chosen one of the "Top 10 Defense Verdicts" of the year in California. He has consistently been named one of the "Bet the Company Commercial Lawyers" in California by Best Lawyers of America and to the Los Angeles Daily Journal's list of "Top Labor & Employment Lawyers" in California. Neubauer has also held a number of leadership positions with the American Bar Association (Vice Chair of the ABA Standing Committee on Publications and ABA Journal Board of Editors), the California State Bar (State Bar Litigation Section Chair), Association of Business Trial Lawyers (President) and the Los Angeles County Bar Association (Assistant Vice President). A member of the California State and the District of Columbia Bar, Neubauer received his J.D. from UCLA School of Law and his M.S. and B.S., with distinction, from Northwestern University's Medill School of Journalism. He is a former reporter with the Miami Herald. Meredith M. Moss will also join the office as a shareholder. She concentrates her practice on employment counseling and complex business litigation matters including employment, unfair competition, intellectual property, Proposition 65 litigation, entertainment, bankruptcy and other commercial disputes. She assists clients in pre-litigation counseling and in all phases of litigation and appeals in both state and federal courts as well as administrative proceedings. She represents national and multinational corporations, including manufacturing, technology, hospitality and entertainment companies, and high-net worth individuals. Moss is a member of the California State Bar (Employment Law Section) and the American Bar Association. She received her J.D. from the University of Virginia School of Law, and her B.A., summa cum laude, from Pepperdine University. Moss received the Pro Bono Civil Rights Award from ACLU Foundation in recognition of her work on behalf of indigent Los Angeles County residents in need of hospital services in Harris v. Los Angeles County Board of Supervisors. The Carlton Fields Jorden Burt L.A. office is located in the Century Plaza Towers, 2029 Century Park East, Suite 2000, Los Angeles, CA 90067. The telephone number of the office is 310.651.2147. * Circuit Pulls Back on Fee Denial for Stay Violation ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the U.S. Court of Appeals in San Francisco backed off somewhat from an opinion in 2010 limiting attorneys' fees someone could recover when a creditor violates the so-called automatic stay. According to the report, the case revolved around Section 362(k) of the Bankruptcy Code which gives an individual bankrupt the right to damages and attorneys' fees for a willful violation of the automatic stay barring actions by creditors to glom property. In Sternberg v. Johnston in 2010, the Ninth Circuit in San Francisco ruled that the bankrupt couldn't recover attorneys' fees incurred in seeking damages for a stay violation, the report related. In a 2-1 opinion, U.S. District Judge Paul Huck from Miami, sitting by designation on the circuit bench, concluded that the new case had different facts justifying a different result and allowing recovery of attorneys' fees, the report further related. In Sternberg, the stay violation had been remedied before the bankrupt sued to recover damages, the report said. The appeals court concluded that the fees weren't recovered from the stay violation itself. Rather, they resulted from the effort to recover damages. The case is America's Servicing Co. v. Schwartz-Tallard (In re Schwartz-Tallard), 12-60052, U.S. Court of Appeals for the Ninth Circuit (San Francisco). * Citigroup Received Mixed Signals On "Stress Test" --------------------------------------------------- Reuters reported that the Federal Reserve indicated to Citigroup Inc. that the bank would get more time to fix certain "stress test" planning problems before rejecting its capital plan last month, people close to the company said. The Fed had agreed to give Citigroup a 2015 deadline to address a series of shortcomings identified by the regulator in the wake of the 2013 test, the Wall Street Journal said. Executives at Citigroup received mixed messages from the Fed and were taken aback after the bank failed to get the nod on its capital plan in March, the Journal reported. Reuters recalled that the Federal Reserve in March rejected Citigroup's plans to buy back $6.4 billion of shares and boost dividends, saying the bank is not sufficiently prepared to handle a potential financial crisis. * Homestead Rights Limited for Non-Bankrupt Spouse -------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that if a couple in Texas have owned a home for less than 1,215 days and only one spouse files for bankruptcy, the non- bankrupt spouse can't bar sale of the home by asserting her homestead right, a federal appeals court in New Orleans ruled on April 9. According to the report, writing for a three-judge panel of the U.S. Court of Appeals in New Orleans, U.S. Circuit Judge Priscilla R. Owen, using analogy to tax law, said federal bankruptcy law takes precedence over state homestead law. She pointed to a Texas Supreme Court case saying that a federal tax lien can be foreclosed against a homestead, the report related. Owen upheld the district court's conclusion that the non-bankrupt wife couldn't bar the sale using her homestead rights, the report further related. She wasn't entitled to compensation beyond the exemption of about $136,000 provided at the time under Section 522(p) of the Bankruptcy Code, the report added. The case is Kim v. Dome Entertainment Center (In re Kim), 10- 10882, U.S. Court of Appeals for the Fifth Circuit (New Orleans). * New Bankruptcy Fees to Take Effect June 1 ------------------------------------------- The Judicial Conference of the United States has approved several bankruptcy related fee increases at its March 2014 session. These fee increases will take effect starting June 1, 2014. The fee for filing a complaint will increase to $350, except: * If the trustee or debtor-in-possession files the complaint, the fee must be paid only by the estate, to the extent there is an estate. * This fee must not be charged if -- the debtor is the plaintiff; or a child support creditor or representative files the complaint and submits the form required by Section 304(g) of the Bankruptcy Reform Act of 1994. The Administrative fee for new bankruptcy cases and for filing a motion to divide a bankruptcy case is currently $46 across all bankruptcy case types. Beginning in June, the fee will differ based on chapter using the following breakdown: * For filing a petition under Chapter 7, 12, or 13, $75 Overall chapter 7 filing fee becomes $335 Overall chapter 12 filing fee becomes $275 Overall chapter 13 filing fee becomes $310 * For filing a petition under Chapter 9, 11, or 15, $550. Overall chapter 9, 11 and 15 filing fee becomes $1717 * When a motion to divide a joint case under Chapter 7, 12, or 13 is filed, $75. Overall fees match fees for new case filings under these chapters * When a motion to divide a joint case under Chapter 11 is filed, $550. Overall fees match the fees for filing new cases under these chapters * Rent Rising Out of Reach for U.S. Middle Class ------------------------------------------------ Shaila Dewan, writing for The New York Times, reported that for rent and utilities to be considered affordable, they are supposed to take up no more than 30 percent of a household's income. But that goal is increasingly unattainable for middle-income families as a tightening market pushes up rents ever faster, outrunning modest rises in pay. According to the report, the strain is not limited to the usual high-cost cities like New York and San Francisco. An analysis for The New York Times by Zillow, the real estate website, found 90 cities where the median rent -- not including utilities -- was more than 30 percent of the median gross income. In Chicago, rent as a percentage of income has risen to 31 percent, from a historical average of 21 percent, the report related. In New Orleans, it has more than doubled, to 35 percent from 14 percent. Zillow calculated the historical average using data from 1985 to 2000. Nationally, half of all renters are now spending more than 30 percent of their income on housing, according to a comprehensive Harvard study, up from 38 percent of renters in 2000, the report further related. In December, Housing Secretary Shaun Donovan declared "the worst rental affordability crisis that this country has ever known." Apartment vacancy rates have dropped so low that forecasters at Capital Economics, a research firm, said rents could rise, on average, as much as 4 percent this year, compared with 2.8 percent last year, the report added. But rents are rising faster than that in many cities even as overall inflation is running at little more than 1 percent annually. * Settlement Prevents New York Apartments' Foreclosure ------------------------------------------------------ Laura Kusisto, writing for The Wall Street Journal, reported that the owners of 1,700 below-market apartments in New York City have struck a deal with their lenders and the state attorney general's office to rescue the portfolio from foreclosure and bring in new management. According to the report, the so-called Three Borough Pool was the largest portfolio to face financial problems since a number of owners of low-cost apartments ran into trouble around the time of the recession, and its difficulties drew the attention of New York Attorney General Eric Schneiderman. The unusual settlement with the owners will provide each tenant with a one-time $600 a month rent rebate -- to compensate them for illegal fees and overcharges -- and require the owner to resolve all building code violations within a year, the report related. The owners, Normandy Real Estate and Westbrook Partners, will get rid of David Kramer, who managed the more than 40 buildings, and bring in Bronx-based Langsam Property Services Corp., the report further related. "The current ownership proactively worked with the attorney general's office to reach an agreement to move down a path toward remedying the past manager's issues and to provide tenants with a new property manager. . . ," said a spokesman for the owners, the report added. * Sufficient Liquidity Portends No Increase in Defaults ------------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that the junk-bond default rate declined in the first quarter to 1.7 percent among non-financial U.S. companies, compared with a default rate of 2.2 percent at the end of 2013, according to a report from Moody's Investors Service. According to the Bloomberg report, the first quarter had seven defaults: five bankruptcies and two so-called distressed exchanges. Defaulted debt totaled $3 billion in the first quarter, compared with $7 billion in defaults by nine companies in the first quarter of 2013, the report related. The largest single default so far this year was by Sorenson Communications Inc. with debt of $1.3 billion, the report further related. Moody's, according to Mr. Rochelle, ascribed the low default rate to "issuer-friendly credit markets" allowing companies with B3 or Caa1 ratings to refinance maturing debt. * U.S. Regulators Examining Departures at Mortgage Registry ----------------------------------------------------------- Jesse Hamilton, writing for Bloomberg News, reported that as the rest of the housing industry recovers, a little-known firm with a key role in U.S. mortgage finance remains stuck in limbo, wrestling with regulators, lawsuits and the departures of senior employees. According to the report, the turbulence feeds uncertainty about the fate of Mortgage Electronic Registrations Systems Inc., or MERS, which documents the ownership and resale of about half of U.S. home loans. A breakdown could force clients such as Fannie Mae and Bank of America Corp. to make costly changes to their loan businesses. Management hasn't completed fixes promised in a broad 2011 U.S. settlement designed to stop foreclosure abuses, the report said, citing two people briefed on MERS' operations. Regulators rejected one of the firm's consultants as unqualified and are examining why four employees hired to help with reforms -- including the chief legal officer -- recently quit, said the people, speaking on condition of anonymity because the matter is private. The closely held Reston, Virginia-based firm, a unit of Merscorp Holdings Inc., is also facing scores of lawsuits and state probes that challenge its business model as well as the legality of its filings in hundreds of county courthouses, the report further related. "Merscorp Holdings Inc. has an unwavering commitment to work with regulators under the consent order and to take all necessary steps to make the company and our members stronger," President and Chief Executive Officer Bill Beckmann said in an e-mailed statement, the report added. He said the company can't comment on personnel or its communications with U.S. agencies. * Vexatious Litigant Determined by Objective Standard ----------------------------------------------------- Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that a "vexatious litigant" can't be let off the hook because her feelings were "heartfelt," the U.S. Bankruptcy Appellate Panel in San Francisco ruled on April 11 in reversing a decision by a bankruptcy judge. According to the report, the case involved a woman whose Chapter 11 plan was set aside in the court of appeals. Her case was converted to a Chapter 7 litigation where she fought the trustee for five years, opposing almost every initiative and repeatedly appealing or seeking rehearing. Frustrated, the trustee went to the bankruptcy judge and sought a ruling denying her standing, or the right to appear in any matter that didn't involve her directly, the report related. The bankruptcy judge denied the motion, and the trustee appealed. The unsigned opinion by the three-judge Appellate Panel reversed the bankruptcy judge, saying he should have used powers under Section 1651(a) of the Judiciary Code, known as the All Writs Act, to enjoin the bankrupt from filing papers without first obtaining court approval, the report further related. The bankruptcy judge declined to enjoin vexatious litigation because he said he believed her filings were "heartfelt," the report added. The Appellate Panel said that was an error because motive is determined on an objective basis. The case is Richardson v. Melcher (In re Melcher), 13-1168, U.S. Bankruptcy Appellate Panel for the Ninth Circuit (San Francisco). * BOND PRICING -- For Week From May 5 to 9, 2014 ------------------------------------------------ Company Ticker Coupon Bid Price Maturity Date ------- ----- ------ --------- ------------- AGY Holding Corp AGYH 11 98.375 11/15/2014 Alion Science & Technology Corp ALISCI 10.25 72.25 2/1/2015 Allen Systems Group Inc ALLSYS 10.5 53.5 11/15/2016 Allen Systems Group Inc ALLSYS 10.5 53.5 11/15/2016 Avaya Inc AVYA 9.75 99.652 11/1/2015 Brookstone Co Inc BKST 13 43.5 10/15/2014 Brookstone Co Inc BKST 13 52.875 10/15/2014 Brookstone Co Inc BKST 13 46 10/15/2014 Buffalo Thunder Development Authority BUFLO 9.375 40.5 12/15/2014 Caesars Entertainment Operating Co Inc CZR 12.75 50.3 4/15/2018 Champion Enterprises Inc CHB 2.75 0.25 11/1/2037 Energy Conversion Devices Inc ENER 3 7.875 6/15/2013 Energy Future Competitive Holdings Co LLC TXU 8.175 4 1/30/2037 Energy Future Holdings Corp TXU 5.55 51 11/15/2014 FairPoint Communications Inc/Old FRP 13.125 1 4/2/2018 Federal Home Loan Mortgage Corp FHLMC 4.25 98.862 5/15/2030 Global Geophysical Services Inc GGS 10.5 56 5/1/2017 Global Geophysical Services Inc GGS 10.5 63.5 5/1/2017 James River Coal Co JRCC 7.875 11.65 4/1/2019 James River Coal Co JRCC 4.5 4.25 12/1/2015 James River Coal Co JRCC 10 10.25 6/1/2018 James River Coal Co JRCC 10 7 6/1/2018 James River Coal Co JRCC 3.125 12.749 3/15/2018 LBI Media Inc LBIMED 8.5 30 8/1/2017 MF Global Holdings Ltd MF 6.25 37 8/8/2016 MF Global Holdings Ltd MF 1.875 50 2/1/2016 MModal Inc MODL 10.75 24 8/15/2020 MModal Inc MODL 10.75 24 8/15/2020 Momentive Performance Materials Inc MOMENT 11.5 31.25 12/1/2016 Motors Liquidation Co MTLQQ 7.2 11 1/15/2011 Motors Liquidation Co MTLQQ 6.75 11 5/1/2028 Motors Liquidation Co MTLQQ 7.375 11 5/23/2048 NII Capital Corp NIHD 10 35.938 8/15/2016 OnCure Holdings Inc RTSX 11.75 48.875 5/15/2017 Platinum Energy Solutions Inc PLATEN 14.25 74.75 3/1/2015 Platinum Energy Solutions Inc PLATEN 14.25 74.75 3/1/2015 Platinum Energy Solutions Inc PLATEN 14.25 74.75 3/1/2015 Platinum Energy Solutions Inc PLATEN 14.25 74.75 3/1/2015 Pulse Electronics Corp PULS 7 80 12/15/2014 Residential Capital LLC RESCAP 6.875 32 6/30/2015 River Rock Entertainment Authority/The RIVER 9 27.375 11/1/2018 Savient Pharmaceuticals Inc SVNT 4.75 0.375 2/1/2018 THQ Inc THQI 5 43.5 8/15/2014 TMST Inc THMR 8 17 5/15/2013 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.25 8.875 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 15 33 4/1/2021 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.25 8.83 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.5 8.25 11/1/2016 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 15 33.125 4/1/2021 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.25 8 11/1/2015 Texas Competitive Electric Holdings Co LLC / TCEH Finance Inc TXU 10.5 7.75 11/1/2016 USEC Inc USU 3 27.5 10/1/2014 Verso Paper Holdings LLC / Verso Paper Inc VRS 11.375 56.5 8/1/2016 Western Express Inc WSTEXP 12.5 72.375 4/15/2015 Western Express Inc WSTEXP 12.5 72.375 4/15/2015 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com by e-mail. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to the nation's bankruptcy courts. The list includes links to freely downloadable of these small-dollar petitions in Acrobat PDF documents. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2014. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. *** End of Transmission ***