/raid1/www/Hosts/bankrupt/TCR_Public/140619.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, June 19, 2014, Vol. 18, No. 169
Headlines
ACADIA HEALTHCARE: Moody's Rates $300MM Sr. Unsecured Notes 'B3'
ACADIA HEALTHCARE: S&P Rates New $300 Million Senior Notes 'B'
ACCIPITER COMMS: June 27 Set as Claims Bar Date
ACG CREDIT COMPANY II: Files Bare-Bones Chapter 11 Petition
ADELPHI ACADEMY: School Files Ch.11 Amid Dispute with Lender
ADELPHI ACADEMY: Proposes $750,000 Loan from Titan Capital
ADELPHI ACADEMY: Seeks to Use Metropolitan Cash Collateral
ALTEGRITY INC: S&P Affirms 'CC' Corp. Credit Rating; Outlook Neg.
ALTISOURCE SOLUTIONS: Moody's Affirms B1 Corporate Family Rating
APEX HOMES: To Test $1.12MM Stalking Horse Bid at July 11 Auction
BATE LAND & TIMBER: Plan Objector Files Summary of Testimony
BIRCH COMMUNICATIONS: S&P Assigns 'B' CCR & Rates$ 500MM Debt 'B'
BLUEJAY PROPERTIES: UNB Balks at Compromise With BBOK et al.
BRICKMAN GROUP: Moody's Affirms 'B2' Corporate Family Rating
BUFFET PARTNERS: Hearing on Sale-Related Issues Moved Sine Die
BUFFET PARTNERS: Has Until June 25 to Reject Inland Leases
CAREFREE WILLOWS: July 16 Hearing to Confirm 5th Amended Plan
CASH STORE: Ont. Superior Court of Justice Approves Sales Process
CENVEO CORP: Moody's Rates New $540MM 1st Lien Notes 'B3'
COLDWATER CREEK: Gets Court Nod to Sell Real Property Leases
CONVERSANT INTELLECTUAL: S&P Withdraws 'B' Rating
CSN HOUSTON: Haynes and Boone, Conway File Fee Applications
D & L ENERGY: Resource Land Sues Over Sale Transaction
D & L ENERGY: Court Approves Settlement with Oscar Sterle
DELRAY FLORIDA: Case Summary & 6 Largest Unsecured Creditors
EASTMAN KODAK: Trust Resolving Clawback Suits
ECOTALITY INC: Asks Court to Extend Plan Exclusivity to Aug. 28
EDGENET INC: May Reject Duke Realty & Rehab Doc Agreements
EDGENET INC: May Sell Assets to EdgeAQ LLC for $7.98MM Cash
EDGENET INC: July 10 Hearing on Noteholders' Bid to Convert Case
ENERGY FUTURE: Provides Update on EFIH Second Lien Settlement
EVENT RENTALS: Wind-Down Budget Agreement Approved
EVENT RENTALS: Case Caption Changed to "After-Party2 Inc."
EVENT RENTALS: Debtors, Committee File Liquidating Plan
FIRST PHILADELPHIA: Has Until July 19 to File Chapter 11 Plan
FIRST PHILADELPHIA: PENNVEST Balks at Confirmation of Plan
FORESTRY MUTUAL: A.M. Best Raises Issuer Credit Rating From 'bb'
GENERAL MOTORS: Creditors-JPMorgan Rift Goes to Del. High Court
GENESEE & WYOMING: Moody's Hikes Corp. Family Rating to 'B2'
HARRIS LAND: Midwest Wins Conditional Stay Relief
HARRIS LAND: Sader Law Firm Approved as Bankruptcy Co-Counsel
HERTZ CORP: Delayed Finc'l Statement No Impact on Moody's B1 CFR
ILLUMINATION IQ: Files Bankr. in Toronto; Meeting on June 26
JAMES RIVER: S&P Withdraws 'D' CCR Over Chapter 11 Filing
JAMAT LLC: Mattress Source Chain Files Ch.11, to Close Outlets
JAZZ ACQUISITION: S&P Assigns 'B' CCR; Outlook Stable
KINDRED HEALTHCARE: Equity Offering No Impact on Moody's B1 CFR
KRIEG FAMILY: Case Summary & 20 Largest Unsecured Creditors
LA QUINTA HOLDINGS: S&P Assigns 'B+' CCR; Outlook Stable
LANGUAGE LINE: Moody's Lowers Corporate Family Rating to 'B3'
LEVEL 3: Moody's Places 'B3' CFR on Review for Upgrade
LILY GROUP: VHGI Creditors Seek Case Consolidation, Parties React
LM U.S. MEMBER: Moody's Rates $220MM 1st Lien Add-on Debt 'B2'
LM U.S. MEMBER: S&P Affirms 'B-' CCR Over Ross Aviation Deal
MARTIFER SOLAR: Unit Amends List of Unsecured Creditors
MARTIFER SOLAR: Enters Into Termination Agreement With JinkoSolar
MILAGRO OIL & GAS: Moody's Withdraws 'Caa3' Corp. Family Rating
MOMENTIVE PERFORMANCE: Committee, et al. Oppose Restructuring Deal
MOMENTIVE PERFORMANCE: Court Sets Deadlines for Filing Claims
NATIVE WHOLESALE: Opposes U.S. Trustee's Bid to Dismiss Case
NEUSTAR INC: Moody's Lowers Corp. Family Rating to 'Ba3'
NOVELIS INC: Moody's Confirms 'B1' Corporate Family Rating
OCEANIA CRUISES: Moody's Raises Corporate Family Rating to 'B2'
OPTIM ENERGY: Deadline to Remove Suits Extended to Sept. 10
OPTIM ENERGY: Has Until Sept. 10 to Assume Lyondell, NRG Leases
OPTIM ENERGY: Settles Dispute With Robertson Over Plant Valuation
OVERSEAS SHIPHOLDING: Lender Presentation Filed
PHILLIPS INVESTMENTS: Files Bare-Bones Chapter 11 Petition
RADIAN GROUP: Moody's Assigns '(P)B3' Senior Unsecured Rating
SAEXPLORATION HOLDINGS: Moody's Rates $150MM Sr. Sec. Notes Caa1
SAEXPLORATION HOLDINGS: S&P Assigns 'B-' CCR; Outlook Stable
SANDIA DRILLING: Live Webcast Asset Auction Scheduled for July 1
SBA COMMUNICATIONS: Moody's Rates $600MM Sr. Unsecured Notes 'B3'
SBA COMMUNICATIONS: S&P Assigns 'B' Rating on $600MM Sr. Notes
SEARS METHODIST: Wins Okay to Borrow $600,000 From Bondholders
SCH CORP: 3rd Cir. Reinstates CFI Claimants' Appeal
SERVICEMASTER COMPANY: Moody's Rates Senior Secured Loan (P)B2
SHRIMP BOAT: Foreclosure Sale on July 18, but Owner to Seek Ch.11
TERRAFORM POWER: S&P Assigns Prelim. 'BB-' CCR; Outlook Stable
TW TELECOM: Moody's Places Ba3 CFR Under Review for Downgrade
WEST CORP: Moody's Assigns 'B3' Rating on $1-Bil. Unsecured Notes
WEST CORP: S&P Rates $1-Bil. Senior Notes Due 2022 'B+'
WEX INC: S&P Puts 'BB' Issuer Credit Rating on CreditWatch Neg.
WINEBOW GROUP: Moody's Assigns 'B2' Corporate Family Rating
WINEBOW GROUP: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
WITHOUT WALLS: Mega Church Foreclosure Auction on July 8
WORLD TRIATHLON: Moody's Assigns 'B2' Corporate Family Rating
* Recent Small-Dollar & Individual Chapter 11 Filings
*********
ACADIA HEALTHCARE: Moody's Rates $300MM Sr. Unsecured Notes 'B3'
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Moody's Investors Service assigned a B3 (LGD 5) rating to Acadia
Healthcare Company, Inc.'s proposed $300 million senior unsecured
notes due 2022. Moody's understands that proceeds of the offering
will be used to partially fund the previously announced $660
million acquisition of Partnerships in Care (PiC), a provider of
inpatient behavioral health services in the United Kingdom.
The affirmation of Acadia's B1 Corporate Family Rating reflects
Moody's expectation that leverage will not be materially impacted
by the acquisition of PiC given the company's use of equity to
fund a material portion of the transaction. Moody's expects that
pro forma debt/EBITDA will remain around 4.5 times. Additionally,
while Moody's acknowledges that the transaction is
transformational, lifting Acadia's pro forma revenue base to over
$1.0 billion and does not present significant opportunities for
synergies, the ability to operate PiC as a separate subsidiary
with existing management remaining in place limits integration
risk.
Ratings assigned:
Senior unsecured notes due 2022, B3 (LGD 5)
Ratings affirmed:
Corporate Family Rating, B1
Probability of Default Rating, B1-PD
12.875% senior notes due 2018, B3 (LGD 5)
6.125% senior notes due 2021, B3 (LGD 5)
Speculative Grade Liquidity Rating, SGL-2
Ratings Rationale
Acadia's B1 Corporate Family Rating reflects Moody's expectation
of EBITDA and cash flow growth as the company integrates recently
acquired facilities in its US operations and benefits from planned
additions to beds at existing facilities and at the PiC
facilities. However, Moody's does not anticipate a meaningful
reduction in leverage over the near term as the company will
continue an active acquisition strategy, which will require
funding through a combination of debt, equity, and available cash.
The acquisition of PiC increases Acadia's scale and improves
diversification, both in terms of geography and revenue sources.
However, the rating also reflects Moody's assessment of risks
associated with the entrance into a new market and the still
significant reliance on government reimbursement both in the
United States (Medicare and Medicaid) and in the United Kingdom
(National Health Service).
The stable rating outlook reflects Moody's expectation that the
company will realize continued growth through expanding bed
capacity at its facilities. A more stable reimbursement
environment, given improvements in state budgets, is likely to
result in continued strong margins. Further, while Moody's expects
the continuation of an aggressive growth strategy through
acquisitions, financial policy -- including the use of equity to
fund investments in growth -- will result in maintaining
debt/EBITDA at around the 4.5 times level. Moody's also expects
very little disruption from the PiC transaction as the operations
will continue as a separate subsidiary , limiting significant
integration risk.
If Acadia can sustainably reduce debt/EBITDA below 4.0 times
through debt repayment or growth in EBITDA while balancing its
expansion strategies, Moody's could upgrade the ratings.
If debt to EBITDA is expected to be sustained above 5.0 times,
either because of a more aggressive pursuit of growth, challenges
in the integration of facilities, adverse reimbursement
developments, or shareholder initiatives, Moody's could downgrade
the ratings.
Acadia is a provider of inpatient behavioral health care services
providing psychiatric and chemical dependency services to its
patients in a variety of settings, including inpatient psychiatric
hospitals, residential treatment centers, outpatient clinics and
therapeutic school-based programs. Pro forma for the acquisition
of PiC, Acadia would have recognized revenue in excess of $1
billion for the last twelve months ended March 31, 2014 after
considering the provision for doubtful accounts.
The principal methodology used in this rating/analysis 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.
ACADIA HEALTHCARE: S&P Rates New $300 Million Senior Notes 'B'
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on Franklin, Tenn.-based Acadia Healthcare Co. Inc.
The outlook is stable.
S&P is assigning a 'B' issue-level rating to the new $300 million
senior notes due 2022 and raising its ratings on the company's
existing senior notes to 'B' from a 'B-'. S&P revised the
recovery rating on the senior notes to '5' from '6', indicating
modest (10%-30%) recovery in the event of payment default.
S&P is also raising its ratings on the company's revolver and term
loan A to 'BB' from 'BB-'. S&P also revise the recovery rating on
the senior secured facility to '1' from '2', indicating very high
(90%-100%) recovery in the event of payment default.
"The ratings on Acadia continue to reflect its exposure to
government reimbursement, concentration in the behavioral health
field, and potential operating and integration challenges as the
company continues to rapidly expand its business, which results in
our "weak" business risk profile assessment," said credit analyst
Tahira Wright. "The acquisition of PiC, the second-largest
private behavioral health company in the U.K. further diversifies
the company's payor mix and geographic diversity which modestly
complements Acadia's overall business risk profile."
S&P's stable outlook reflects that the company will continue to
pursue an aggressive growth strategy which will keep leverage at a
sustained level between 4.0x and 4.5x.
Upside scenario
S&P could consider an upgrade if the company's aggressive growth
strategy could be supported with maintaining leverage below 4.0x.
S&P believes the company's business risk is limited to the "weak"
category given its sole concentration in behavioral health and
high exposure to potential rate reductions from government payors.
Downside scenario
A downgrade could occur if Acadia makes a major-debt financed
acquisition that will result in debt leverage at a sustained level
above 5x, supporting a "highly leveraged" financial risk profile.
S&P believes an acquisition of $800 million to $850 million could
result in this scenario. S&P could also lower the rating if
operations are stifled by significant reimbursement cuts or
recently acquired operations are unsuccessfully integrated,
resulting in an EBITDA margin decline of more than 400 bps. This
would also result in credit metrics that support a highly
leveraged financial risk profile.
ACCIPITER COMMS: June 27 Set as Claims Bar Date
-----------------------------------------------
The Bankruptcy Court established June 27, 2014, as the deadline
for any individual or entity to file proofs of claim against
Accipiter Communications, Inc.
Accipiter Communications, Inc., a Phoenix-based company that
provides telecommunications services to unserved or underserved,
mostly rurally-situated residences and businesses in central
Arizona, filed a Chapter 11 bankruptcy petition (Bankr. D. Ariz.
Case No. 14-04372) in its hometown on March 28, 2014.
Accipiter provides telecommunications services to 1,409
residential subscribers and 231 business subscribers, including an
elementary school, an enforcement agency, a fire station, two
municipal water supply facilities, and a bank.
The Debtor is able to provide telecommunications services to rural
customers only by participating in two federal programs: revenue
subsidies from the federal Universal Service Fund, which is
administered under the authority of the Federal Communications
Commission, and capital debt financing provided under a rural
telecommunications loan program administered by the Rural
Utilities Service, an agency of the U.S. Department of
Agriculture.
As of the Petition Date, the Debtor owed $20.8 million in
aggregate principal to the RUS. The Debtor believes there is
approximately $414,000 in prepetition general unsecured claims
held by trade vendors or other parties against the Debtor. The
Debtor is a privately held company, with 55.4% of the stock held
by Lewis van Amerongen. In its schedules, the Debtor listed
$31,250,731 in total assets and $21,628,826 in total liabilities.
The bankruptcy case is assigned to Judge George B. Nielsen Jr.
The Debtor has tapped Perkins Coie LLP as counsel.
Ilene J. Lashinsky, U.S. Trustee for Region 14, appointed these
three creditors to serve in the Official Committee of Unsecured
Creditors. The Committee retained Stinson Leonard Street LLP as
counsel.
ACG CREDIT COMPANY II: Files Bare-Bones Chapter 11 Petition
-----------------------------------------------------------
New York-based ACG Credit Company II, LLC, filed a Chapter 11
bankruptcy petition (Bankr. D. Del. Case No. 14-11500) on June 17,
2014, without stating a reason. The company has tapped Gellert
Scali Busenkell & Brown, LLC, as counsel. The Debtor estimated
$10 million to $50 million in assets and less than $10 million in
debt. The Debtor said in the petition that it estimates that
funds will be available for distribution to unsecured creditors.
ADELPHI ACADEMY: School Files Ch.11 Amid Dispute with Lender
------------------------------------------------------------
Adelphi Academy -- operator of the Adelphi Academy of Brooklyn, a
not-for-profit, 501(c)(3), private and independent school from
property it owns at 8515 Ridge Boulevard in Bay Ridge, Brooklyn --
filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 14-43065) in
Brooklyn on June 16, 2014.
The Debtor on the Petition Date filed a motion to obtain credit
under 11 U.S.C. Sec. 364(b), use cash collateral, and pay
prepetition wages.
Prior to the Petition Date, the Debtor was a defendant to a
foreclosure action commenced by Metropolitan National Bank, the
holder of a mortgage on the Debtor's property in Brooklyn and a
first lien on all of the Debtor's assets. While the Debtor
disputed and continues to dispute the purported technical default
that resulted in the commencement of the foreclosure proceeding by
Metropolitan, the resulting negative publicity significantly
impacted the Debtor's reputation and resources and despite
continued efforts, its student enrollment declined. Because of
the reduced enrollment and depletion of resources, the Debtor says
it has encountered financial difficulties and cash flow shortfalls
and has been unable to operate profitably.
The school currently enrolls 100 students from Pre-Kindergarten
through 12th grade. The school has a 5-story building housing
offices, classrooms and labs, a basement floor containing a
cafeteria and a library of over 20,000 volumes and a gymnasium.
The Debtor estimated $10 million to $50 million in assets and less
than $10 million in debt. The Debtor's property is encumbered by
a mortgage held by Metropolitan securing a claim evidenced by a
note in the amount of $6.2 million, which mortgage is the subject
of the foreclosure action.
The bankruptcy case is assigned to Judge Elizabeth S. Stong.
The Debtor has tapped Robinson Brog Leinwand Greene & Gluck P.C.
as counsel.
According to the docket, the Debtor is required to submit a
Chapter 11 plan and disclosure statement by Oct. 14, 2014.
ADELPHI ACADEMY: Proposes $750,000 Loan from Titan Capital
----------------------------------------------------------
Adelphi Academy is asking approval from the bankruptcy court to
obtain postpetition financing of up to $750,000 from Titan Capital
ID, LLC.
The Debtor urgently requires working capital to continue its
operations including, for expenses and costs for completing the
school term and to maintain its planned summer school, camp and
other programs and activities. The Debtor is not able to operate
its school at full capacity. The Debtor's ability to operate on a
going forward basis, to secure and maintain its relationships with
its students and staff, and to rehabilitate its business
relationships with its vendors and suppliers is dependent on its
ability to obtain the funds made available under the DIP
Financing.
The significant elements of the DIP Financing are:
* Term: Twelve months.
* Priority: All of the obligations will be secured by a
first priority priming lien on the Debtor's
property and a perfected first priority
security interest in all personal property
and/or equipment used in connection with the
property, subject to a carve out.
* Superpriority
Claim: The Debtor has agreed to grant the lender an
allowed superpriority administrative claim
pursuant to Section 364(c)(1) of the Bankruptcy
Code.
* Carve-Out: All amounts payable to the Office of the United
States Trustee pursuant to 28 U.S.C. Section
1930(a) and amounts awarded to counsel to the
Debtor for professional fees and expenses under
Sections 330 and 331 of the Bankruptcy Code up
to a maximum of $50,000.
* Interest
Rate: The interest rate on the outstanding
obligations will be 12%.
* Negative
Covenants: No additional senior or secondary financing
will be permitted during the term of the loan,
either secured or unsecured.
About Adelphi Academy
Adelphi Academy, operator of the Adelphi Academy of Brooklyn, a
not-for-profit, 501(c)(3), private and independent school from
property it owns at 8515 Ridge Boulevard in Bay Ridge, Brooklyn,
filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 14-43065) in
Brooklyn on June 16, 2014.
The school currently enrolls 100 students from Pre-Kindergarten
through 12th grade. The school has a 5-story building housing
offices, classrooms and labs, a basement floor containing a
cafeteria and a library of over 20,000 volumes and a gymnasium.
The Debtor estimated $10 million to $50 million in assets and less
than $10 million in debt. The Debtor's property is encumbered by
a mortgage held by Metropolitan National Bank securing a claim
evidenced by a note in the amount of $6.2 million, which mortgage
is the subject of a pending foreclosure action. The foreclosure
action prompted the Debtor to seek bankruptcy protection.
The bankruptcy case is assigned to Judge Elizabeth S. Stong.
The Debtor has tapped Robinson Brog Leinwand Greene & Gluck P.C.
as counsel.
According to the docket, the Debtor is required to submit a
Chapter 11 plan and disclosure statement by Oct. 14, 2014.
ADELPHI ACADEMY: Seeks to Use Metropolitan Cash Collateral
----------------------------------------------------------
Adelphi Academy is asking approval from the bankruptcy court to
use cash collateral of Metropolitan National Bank in accordance
with a budget.
The Debtor has insufficient cash, absent use of Metropolitan's
cash collateral to meet its ongoing obligations necessary to
maintain and operate its business.
The Debtor has submitted a 13-week budget. The Debtor's budget is
relatively static and the Debtor anticipates the monthly expenses
provided for in the Budget will recur each month within a normal
variance.
According to the Debtor's proposed counsel, A. Mitchell Greene,
Esq., at Robinson Brog Leinwand Greene Genovese & Gluck P.C., the
current outstanding obligation to Metropolitan is $6.2 million and
with an estimated value of the Debtor's property at $15 million.
Accordingly, Metropolitan is significantly oversecured. To
adequately protect Metropolitan with respect to the Cash
Collateral utilized during its case, the Debtor will (a) maintain
the value of the Property though payment of the normal monthly
expenditures in general accord with the budget, (b) maintain the
cash it collects over and above its expenditures in its debtor in
possession account pending further order of the Court, and (c) to
the extent that Metropolitan does not have a postpetition security
interest in the Debtor's postpetition assets, grant Metropolitan a
security interest in such assets to the extent of any diminution
of cash collateral (subject and subordinate to, inter alia, the
DIP financer, if such financing is approved, the fees of the
United States Trustee and the professional fees of the Debtor's
professionals).
About Adelphi Academy
Adelphi Academy, operator of the Adelphi Academy of Brooklyn, a
not-for-profit, 501(c)(3), private and independent school from
property it owns at 8515 Ridge Boulevard in Bay Ridge, Brooklyn,
filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 14-43065) in
Brooklyn on June 16, 2014.
The school currently enrolls 100 students from Pre-Kindergarten
through 12th grade. The school has a 5-story building housing
offices, classrooms and labs, a basement floor containing a
cafeteria and a library of over 20,000 volumes and a gymnasium.
The Debtor estimated $10 million to $50 million in assets and less
than $10 million in debt. The Debtor's property is encumbered by
a mortgage held by Metropolitan National Bank securing a claim
evidenced by a note in the amount of $6.2 million, which mortgage
is the subject of a pending foreclosure action. The foreclosure
action prompted the Debtor to seek bankruptcy protection.
The bankruptcy case is assigned to Judge Elizabeth S. Stong.
The Debtor has tapped Robinson Brog Leinwand Greene & Gluck P.C.
as counsel.
According to the docket, the Debtor is required to submit a
Chapter 11 plan and disclosure statement by Oct. 14, 2014.
ALTEGRITY INC: S&P Affirms 'CC' Corp. Credit Rating; Outlook Neg.
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'CC' corporate
credit rating on Falls Church, Va.-based Altegrity Inc. The
outlook is negative.
At the same time, S&P affirmed its 'CCC-' senior secured debt
rating. 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, S&P affirmed its 'C' senior unsecured and
subordinated debt ratings (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 affirmations follow Altegrity's commencement of a
comprehensive recapitalization in advance of large debt maturities
that total approximately $1 billion through February 2015 and $1.8
billion through May 2016. 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 paydowns and increased paid-in-kind (PIK) interest to
existing senior unsecured debt.
"We believe the transactions are tantamount to a default, given
the company's distressed financial condition and since investors
are receiving less value than the promise of the original
securities," said Standard & Poor's credit analyst Rodney Olivero.
"We intend to lower the corporate credit rating to 'SD' and the
affected issue-level ratings to 'D' assuming the distressed
exchange is completed in July 2014. We expect that we will raise
our ratings shortly thereafter, after we complete a forward-
looking review that takes into account the company's business risk
and financial risk profiles, including any additional benefits
from the proposed debt exchange, not currently anticipated."
ALTISOURCE SOLUTIONS: Moody's Affirms B1 Corporate Family Rating
----------------------------------------------------------------
Moody's Investors Service affirmed Altisource Solutions S.a.r.l.'s
B1 Corporate Family Rating ("CFR") and its B1 rating on its senior
secured term loan following the company's announcement of its plan
to increase the loan to $595.5 million from $395.5 million. The
outlook for the ratings is stable.
Ratings Rationale
The ratings are largely driven by the company's high reliance on
Ocwen (B1/STA). Altisource was spun off from Ocwen in 2009 and
currently derives approximately 61% of the overall revenue through
its key relationship with Ocwen. In addition, Altisource, with
$768 million of revenues in 2013, is substantially smaller than
its business service company peers, CoreLogic and Fidelity
National Information Services.
The company benefits from its strong cashflow and solid earnings,
which compares favorably to other B1 peers. Although the company
is increasing its leverage, it is still typically well below other
B1 peers measured on a Debt to EBITDA basis. In addition to
benefiting from Ocwen's growth, the company's growth strategy is
focused on increasing revenue from property management and
origination related services. The company's recent acquisition of
Equator, LLC, a provider of mortgage-related software, further
strengthens Altisource's fee- based mortgage software platform.
The stable rating outlook reflects Moody's expectation that
Altisource will maintain its level of profitability and cash flows
as the company continues to grow.
Upgrades in Ocwen's ratings could create upward rating pressure
for Altisource. In addition, a significant reduction in
Altisource's reliance on Ocwen while maintaining its current level
of financial performance could create upwards rating pressure as
well.
Downgrades in Ocwen's ratings or the loss of Ocwen's contract
could create downward rating pressure. In addition, the ratings
could be downgraded if the company's financial metrics materially
deteriorate for an extended period of time, including operating
margins below 15%, free cash flow to debt below 5%, or debt to
EBITDA above 3.5x.
Altisource is a business services company providing services to
the real estate, mortgage, asset recovery and financial services
market.
APEX HOMES: To Test $1.12MM Stalking Horse Bid at July 11 Auction
-----------------------------------------------------------------
Apex Homes, Inc., has been granted permission to conduct an asset
sale under the supervision of the Bankruptcy Court. Apex has
filed a motion for an order approving the sale of substantially
all of its assets free and clear of liens, claims and encumbrances
and authorizing assumption and assignment of executory contracts,
and a hearing has been scheduled for July 17, 2014 at 10:00 a.m.
in the United States Bankruptcy Court for the Middle District of
Pennsylvania, located at Ronald Regan Federal Building, Bankruptcy
Courtroom, Third Floor, 228 Walnut Street, Harrisburg,
Pennsylvania.
A stalking horse bid valued at $1,125,000 has been conditionally
approved by the Bankruptcy Court, and is subject to higher and
better offers submitted in accordance with bidding procedures that
have been approved by the Bankruptcy Court. Higher and better
offers for the Debtor's assets that comply with the bidding
procedures will be accepted until July 11, 2014 at 5:00 p.m.
If other qualified bids are received, an auction will be conducted
on July 15, 2014, commencing at 10:00 a.m. at the offices of
Apex's counsel. The Auction will be conducted by Apex and subject
to the approval of the Bankruptcy Court.
Subject to the execution of a confidentiality agreement, certain
financial and operational information regarding Apex can be made
available to interested parties who may wish to participate in the
sale process. Interested parties may request additional
information and documentation concerning the assets, the sale, and
the requirements for bidding, along with copies of the Motion and
documents that have been filed with the Bankruptcy Court, by
contacting Apex's counsel at:
Henry W. Van Eck, Esq.
METTE, EVANS & WOODSIDE
3401 N. Front Street
Harrisburg, PA 17110
Tel: (717) 232-5000
Fax: (717) 236-1816
E-mail: hwvaneck@mette.com
Apex Homes, in Middleburg, PA, filed for Chapter 11 bankruptcy
(Bankr. M.D. Pa. Case No. 12-00560) on Jan. 31, 2012, in
Harrisburg. Judge Robert N. Opel II presides over the case.
Henry W. Van Eck, Esq., at Mette, Evans, & Woodside. In its
petition, the Debtor estimated $0 to $50,000 in assets and
$1 million to $10 million. A list of the Debtor's 20 largest
unsecured creditors is available for free at
http://bankrupt.com/misc/pamb12-00560.pdf The petition was signed
by Chriss R. Nipple, president.
BATE LAND & TIMBER: Plan Objector Files Summary of Testimony
------------------------------------------------------------
Bate Land Company L.P. filed a document in connection with its
objection to confirmation of Bate Land & Timber LLC's Plan of
Reorganization. A copy of Bate Land Company's summary of
testimony in opposition of the Plan is available for free at:
http://bankrupt.com/misc/Bate_Land_BLC_Obj_Testimony.pdf
BLC claims to be owed $13 million as a result of a purchase money
promissory note and deeds of trust. BLC says the Debtor's Plan
cannot be confirmed because it fails to meet the substantive
requirements for confirmation as set forth in 11 U.S.C. Section
1129. The Debtor says its Plan proposes to pay nothing to BLC
because, the Debtor contends, BLC's debt was fully satisfied prior
to the filing of the Chapter 11 petition.
Early this month, the Debtor sought and obtained an order
extending until June 16 the time within which to file its summary
of evidence in support of confirmation of the Plan.
The Plan
As reported in the Troubled Company Reporter on Sept. 10, 2013,
Judge Stephani W. Humrickhouse conditionally approved the
disclosure statement explaining the Debtor's Plan.
The Plan proposes to sell all of the Debtor's real property valued
at $47,032,125, and personal property valued at $6,445,499.
Proceeds from the asset sales will fund the Plan. The liens
secured by the Debtor's property will attach to the net proceeds
of the sale remaining after payment costs of sale and all
reasonable and ordinary closing costs.
A full-text copy of the Plan, dated Aug. 30, 2013, is available
for free at http://bankrupt.com/misc/BATELANDds0830.pdf
About Bate Land & Timber
Willotte, North Carolina-based Bate Land & Timber, LLC, sought
protection under Chapter 11 of the Bankruptcy Code on July 25,
2013 (Case No. 13-04665, E.D.N.C.). Judge Stephani W.
Humrickhouse oversees the Chapter 11 case.
The Debtor, in amended schedules, disclosed $53,477,624 in assets
and $74,162,211 liabilities as of the Chapter 11 filing. The
petition was signed by Brad Cheers, manager.
The Plan filed in the case proposes to sell all of the Debtor's
real property valued at $47,032,125, and personal property valued
at $6,445,499. Proceeds from the asset sales will fund the Plan.
The liens secured by the Debtor's property will attach to the net
proceeds of the sale remaining after payment costs of sale and all
reasonable and ordinary closing costs.
The Bankruptcy Administrator for the Eastern District of North
Carolina was unable to organize and recommend the appointment of a
committee of creditors holding unsecured claims against the
Debtor.
BIRCH COMMUNICATIONS: S&P Assigns 'B' CCR & Rates$ 500MM Debt 'B'
-----------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B'
corporate credit rating to Atlanta-based Birch Communications
Holdings Inc. The outlook is stable.
S&P also assigned a 'B' issue-level rating and '3' recovery rating
to borrower Birch Communications Inc.'s proposed $450 million
senior secured term loan and $50 million revolving credit
facility. The '3' recovery rating indicates S&P's expectation for
meaningful (50%-70%) recovery in the event of payment default.
Birch is a CLEC that is acquiring Atlanta-based Cbeyond Inc.
Proceeds from the term loan and about $3.5 million of cash will be
used to fund the $323 million acquisition of Cbeyond, repay about
$116 million of existing debt, and pay about $24 million of
related fees and expenses.
"The ratings on Birch reflect intense competitive pressures from
better-capitalized telecom providers, primarily AT&T, and from
cable operators in the small and midsize business segment," said
Standard & Poor's credit analyst Allyn Arden.
The ratings also reflect potential pricing pressure, low barriers
to entry, high churn, and comparatively low profitability, which
are inherent risk factors for all CLEC providers. Tempering
factors include modest geographic diversity and the potential for
substantial cost savings from the acquisition of Cbeyond. These
factors lead to a "vulnerable" business risk profile.
The stable outlook reflects S&P's expectation for modest levels of
FOCF over the next few years and leverage declining below 4x in
2015, given its forecast for slight revenue declines more than
offset by margin improvement from cost savings.
S&P could lower the rating if business conditions deteriorate
resulting from higher-than-expected churn and pricing pressure, or
if the company experiences severe execution missteps during the
integration of Cbeyond, leading to FOCF of less than $20 million
per year.
While unlikely over the next year, an upgrade would require an
upward revision of S&P's business risk assessment to "weak"
coupled with sustained leverage below 4x. This would entail a
demonstrated turnaround of Cbeyond's operations and realization of
cost synergies while maintaining solid, continued growth in the
legacy Birch markets. If Birch's margins were to increase to the
high-20% area this could prompt a positive revision of the
business risk profile. An upgrade would also be contingent on
Birch generating FOCF to debt approaching 15%.
BLUEJAY PROPERTIES: UNB Balks at Compromise With BBOK et al.
------------------------------------------------------------
The University National Bank objected to the motion of Bluejay
Properties, LLC to approve a compromise and settlement with
Bankers' Bank of Kansas, Kaw Valley Bank and the individual
members of the Debtor, stating that, among other things:
1. The compromise and settlement contemplates a subsequent
motion for sale under Rule 6004 of the Federal Rules of Bankruptcy
Procedure. The compromise and settlement is to settle certain
(but not all) outstanding litigation and to convey the real
property secured by a first mortgage lien of Bankers' Bank of
Kansas to BBOK under the provisions of Section 363(k) of the
Bankruptcy Code.
2. While UNB supports the effort to vest title in BBOK, the
motion purports to compromise a portion of the litigation pending
and fund creditors and claimants whose interest and right to
recovery have yet to be determined under the pending litigation.
3. Litigation is underway between the debtor, BBOK, UNB and the
guarantors of the BBOK and UNB debt alleging various state law
causes of action.
UNB holds a subordinate second lien on the Debtor's property. KVB
has asserted various tort and fraud related theories in its
litigation against UNB, BBOK and other third parties. KVB, at
best, holds a contingent unsecured claim or a recovery based upon
a constructive trust theory. The settlement proposal primes or
leap frogs KVB ahead of UNB and the sale mechanism attempts to
strip UNB's lien rights on the real property.
As reported in the Troubled Company Reporter on June 4, 2014, the
Debtor said that the bankruptcy case has been subject to
significant disputes in all aspects of the operations of the
Debtor and the continued litigation between the various creditors
and the Debtor. The members of Bluejay Properties, LLC --
Opportune, LLC, comprised of Brennan Fagan and Bill Skepnek, and
Larkin Excavating, Inc., owned by John Larkin -- have been subject
to a lawsuit in Sedgwick County demanding payment of the
obligations of the Debtor under certain guarantee agreements with
BBOK. That case has been ongoing since 2012.
In general, the agreement and settlement will:
1. establish an allowed claim of BBOK as a secured claim, which
in turn will provide an opportunity for BBOK to credit bid at an
agreed auction sale of the property. At the same time the
agreement resolves the litigation between the Debtor, BBOK, Kaw
Valley Bank and the members of Bluejay Properties.
2. creditor Kaw Valley Bank would obtain compensation on part
of its claim in the case, and would provide for a judgment against
the Debtor for its claim.
3. provide for the release of the individual members from their
guarantee agreements with BBOK, and a release from the guarantee
suit in state court.
4. leave the Debtor with only limited unsecured and contingent
claims that, upon information and belief, will be withdrawn or
satisfied by the settlement. At the same time, the agreement
allows for the Debtor to satisfy administrative costs and to file
appropriate tax returns.
Under the settlement, UNB would be allowed to protect its position
by bidding over BBOK at the auction sale. While it should not be
allowed to credit bid, as it is not owed money by the Debtor, it
can preserve its position by purchasing the property and paying
off the likely bid price by BBOK. By this, UNB obtains all the
rights that it negotiated for and obtained by filing the second
mortgage in the case. UNB has not obtained the right legally to
obtain money in satisfaction for its claim from the Debtor, only
to look towards the real property for satisfaction of its claim.
UNB is represented by:
Edward J. Nazar, Esq.
REDMOND & NAZAR, L.L.P.
245 North Waco, Suite 402
Wichita, KS 67202-1117
Tel: (316) 262-8361
Fax: (316) 263-0610
E-mail: ednazar@redmondnazar.com
About Bluejay Properties
Based in Junction City, Kansas, Bluejay Properties, LLC, doing
business as Quinton Point, filed a bare-bones Chapter 11 petition
(Bankr. D. Kan. Case No. 12-22680) in Kansas City on Sept. 28,
2012. Bankruptcy Judge Robert D. Berger presides over the case.
Todd A. Luckman, Esq., and Kathryn E. Sheedy, Esq., at Stumbo
Hanson LLP, in Topeka.
The Debtor owns the Quinton Point Apartment Complex in Kansas City
valued at $17 million. The Debtor scheduled liabilities of
$13,112,325. The petition was signed by Michael L. Thomas of TICC
Prop., managing member.
Bankers' Bank of Kansas, owed approximately $13.08 million, is
represented by Arthur S. Chalmers of Hite, Fanning & Honeyman,
LLP. The University National Bank, owed approximately
$1.2 million, is represented by Edward J. Nazar of Redmond &
Nazar, L.L.P., and Todd Thompson of Thompson Ramsdell & Qualseth,
P.A.
There has been no official committee of unsecured creditors
appointed in the case.
BRICKMAN GROUP: Moody's Affirms 'B2' Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service affirmed the B2 Corporate Family Rating
of The Brickman Group Ltd., LLC following its announcement that it
will be raising $825 million of Incremental Senior Secured Credit
Facilities. The proposed incremental debt will encompass $100
million Incremental Revolving Credit Facility and $725 million
Incremental Senior Secured First Lien Term Loan. As a result, the
rating of the existing Senior Secured First Lien Term Loan due
2020 was downgraded to B2 from B1 representing the larger
proportion of senior secured first lien debt to senior secured
second lien debt. The Senior Secured Second Lien Term Loan due
2021 was affirmed at Caa1. Brickman's B2-PD Probability of Default
Rating was also affirmed. The rating outlook is stable.
The ratings assume that the proceeds of the proposed $825 million
Incremental Senior Secured Credit Facilities will be used to
finance the acquisition of ValleyCrest Companies, LLC, including
the repayment of ValleyCrest's existing debt obligations. The
rating also assumes that Brickman will reduce its adjusted debt-
to-EBITDA below 6.0x over the next 18 months. Once ValleyCrest's
existing debt obligations are repaid, all of ValleyCrest's ratings
will be withdrawn.
The following rating actions were taken:
$100 million Incremental Senior Secured First Lien Revolving
Credit Facility due 2018, assigned B2 - LGD3;
$110 million Senior Secured First Lien Revolving Credit
Facility due 2018, downgraded to B2 -- LGD3 from B1 - LGD3;
$725 million Incremental Senior Secured First Lien Term Loan
Facility due 2020, assigned B2 - LGD3;
$735 million Senior Secured First Lien Term Loan Facility due
2020, downgraded to B2 -- LGD3 from B1 - LGD3;
$235 million Senior Secured Second Lien Term Loan Facility due
2021, affirmed at Caa1 -- LGD6;
Corporate Family Rating, affirmed at B2;
Probability of Default Rating, affirmed at B2-PD;
Rating outlook is stable.
Ratings Rationale
The company's B2 Corporate Family Rating reflects high adjusted
debt to EBITDA leverage and low pretax income, offset by a broad
platform of landscape services, national footprint, strong market
position in markets served and diversified client base. Moody's
expect the combined platform will enhance earnings and cash flow
generation through revenue growth and cost synergies. Brickman has
historically engaged in leveraged recapitalizations and cash
financed acquisitions, thus maintaining its elevated debt
leverage, despite its long term cash generation track record.
Moody's expect Brickman to remain acquisitive in future periods,
and to continue to follow a cycle of debt reduction and re-
levering.
Brickman's credit profile is supported by its leading position in
commercial landscape maintenance, recurring and somewhat
recession-resistant revenue stream, relatively stable operating
profits and margins, and consistent free cash flow generation.
The stable outlook presumes that Brickman will continue to
demonstrate stability and modest improvement in its operating
performance, apply free cash flow to debt reduction, and maintain
adequate liquidity. The stable outlook also presumes that the
integration of ValleyCrest is executed successfully and that
adjusted debt-to-EBITDA will decline to below 6.0x over the next
18 months.
The company's liquidity is supported by its newly upsized $210
million First Lien Senior Secured Revolving Credit Facility,
consistent free cash flow generation throughout various economic
cycles, and lack of debt maturities until 2018. Liquidity,
however, is constrained by Brickman's thin pro forma cash balance
of $13 million, and the need to maintain compliance with its
credit agreement springing first lien leverage financial covenant,
which applies if more than 30% of the facility is utilized. In
Moody's view, the company should be able to maintain compliance
with this covenant over the next 12 to 18 months.
Brickman's ratings could be considered for an upgrade if its
adjusted debt-to-EBITDA leverage declined below 4.0x and EBIT-to-
interest improved above 2.0x, and the company's financial policies
supported maintaining such levels.
The ratings could be downgraded if the company's adjusted debt-to-
EBITDA leverage remains above 6.0x beyond 2015, if profitability
declines substantively, if liquidity deteriorates or if any
financial or operational issues result from the integration of
ValleyCrest.
The merger of the Brickman and ValleyCrest is expected to close by
mid-2014. The existing ratings of ValleyCrest, including the B2
Corporate Family Rating, the B2-PD Probability of Default Rating,
and the B3 Senior Secured Bank Credit Facility rating, are
expected to be withdrawn upon the closing of the transaction.
Moody's has also made certain corrections to its database. On
December 3, 2013, Moody's Investors Service assigned a B1 rating
to the proposed $735 million first lien senior secured term loan
due 2020, a B1 rating to the $110 million first lien senior
secured revolving credit facility due 2018, and a Caa1 rating to
the $235 million second lien senior secured term loan due 2021.
Due to an internal administrative error, these ratings were
assigned under Brickman Group Holdings, Inc. Moody's has corrected
its ratings database to reflect the correct issuer name as The
Brickman Group Ltd. LLC. At the same time, Moody's has updated its
ratings database to reflect that a B2 Corporate Family Rating and
B2-PD Probability of Default Rating were assigned to The Brickman
Group Ltd. LLC on December 3, 2013. As of that date, the Corporate
Family Rating and Probability of Default Rating previously
assigned to Brickman Group Holdings, Inc. have been withdrawn.
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.
The Brickman Group Ltd., LLC, headquartered in Gaithersburg, MD,
is a provider of landscape maintenance, landscape construction and
enhancement, and snow removal services.
BUFFET PARTNERS: Hearing on Sale-Related Issues Moved Sine Die
--------------------------------------------------------------
The Bankruptcy Court has reset to a later date yet to be
determined the hearing on objections to Buffet Partners, L.P., et
al.'s motion to sell substantially all assets; and to assume and
assign leases.
The hearing was set for June 9.
On April 23, 2014, Buffet Partners filed a notice saying that no
auction will be conducted as no qualified bids were received by
the Debtors. With no qualified bids, the hearing to approve the
sale of the purchased assets to the stalking horse bidder, Chatham
Credit Management III, LLC, was set for April 29.
On May 12, the Bankruptcy Court approved the sale of substantially
all of the Debtors' assets to Chatham, the secured lender; and
authorized the assumption and assignment of certain executory
contracts. Certain of the assumption and assignment objections
were to be resolved at a later hearing.
On March 14, 2014, Buffet Partners and its affiliate filed their
motion for court order approving, among other things, the
procedures for the sale, and the assumption and assignment of
certain executory contracts and unexpired leases. The Court
approved the sale procedures on March 24, 2014. A copy of the
procedures is available for free at:
http://bankrupt.com/misc/BUFFETPARTNERS_216_saleord.pdf
Objections were filed by (i) Bexar County, Cameron County, Dallas
County, Ector CAD, El Paso, Harris County, McAllen, South Texas
College, South Texas ISD, Sulphur Springs, Sulphur Springs ISD,
and Tarrant County on April 16, 2014; and (ii) landlord Inland
Diversified Dallas Wheatland, L.L.C., on April 23, 2014.
The Tax Authorities have filed secured claims for unpaid 2014 and
prior years' ad valorem property taxes. These tax claims are
secured by first priority liens on the Debtors' real and personal
property. The tax claims total approximately $300,000. According
to the Tax Authorities, even if the sale terms provided that the
tax liens attach to the sale proceeds, this would not adequately
protect the tax liens and claims. Upon the sale of the property,
the proceeds become the Tax Authorities' cash collateral. Absent
consent by the Tax Authorities or an order of the Court permitting
use of the cash collateral, the Debtors will segregate and account
for any cash collateral in their possession. The Debtors have not
filed a motion seeking to use the Tax Authorities' cash
collateral. Unless and until their claims are paid in full, the
Local Texas Tax Authorities object to the use of their cash
collateral by the Debtors.
Inland Diversified and the Debtor are parties to an unexpired
lease of non-residential real property located at the intersection
of Interstate 20 and Wheatland Road, Dallas, Texas. The premises
is located within a shopping center. According to Inland
Diversified, the March Operating Report shows, notwithstanding a
purported $736.97 net profit for the month, a loss of cash of
$976,968.48 from $3,465,342.47 to $2,488,374, which calls into
question the future liquidity of the business and further
illustrates the Landlord's need for adequate assurance of future
performance under the Lease. Inland Diversified notes that the
lease provides that as security for payment of rent, Inland
Diversified will have a lien on all of the tenant's property now
or hereafter located upon the premises.
Stipulations on Sale of Assets
On April 30, 2014, the court approved a stipulation and agreed
order between the Debtors, and Las Palmas RioCan L.P., successors
to A.D.D. Holdings, L.P. The agreement was to resolve objection
relating to the lease.
Prior to the Petition Date, the Debtors' predecessor-in-interest,
Cafeteria Operators, L.P., entered into a lease dated Oct. 7,
1999, under which Riocan leased certain restaurant premises to
Cafeteria Operators, L.P.
The stipulation provides that (i) the cure amount as of May 31,
2014, with respect to the lease will be $54,443; and (ii) the
Court will retain exclusive jurisdiction over any and all disputes
arising out of or otherwise relating to the order.
Riocan is represented by:
R. Spencer Shytles, Esq.
GRAHAM, BRIGHT & SMITH
Two Lincoln Centre
5420 LBJ Freeway, Suite 300
Dallas, TX 75240
Tel: (972) 788-5300
Fax: (972) 770-2156
E-mail: rss@gbstxlaw.com
- and -
John E. Mitchell, Esq.
Rosa A. Shirley, Esq.
BAKER & MCKENZIE LLP
2300 Trammell Crow Center
2001 Ross Avenue
Dallas, TX 75201
Tel: (214) 978-3000
Fax: (214) 978-3099
E-mails: john.mitchell@bakermckenzie.com
rosa.shirley@bakermckenzie.com
In a separate filing, the Debtors entered into separate
stipulation and order with The Richards Group, Inc., which
provides that, among other things:
1. the cure amount will be $4,931, which is comprised of (a)
$4,291 the amount needed to cure prepetition defaults; plus (b)
$639, the outstanding amount the Debtors have incurred
postpetition under the hosting agreement;
2. upon payment of the cure amount to TRG, the Debtors may
assume the hosting agreement;
3. the Debtors may terminate the hosting agreement, or deem the
hosting agreement terminated, as of the closing date of the sale
contemplated in the sale motion. Any notice required to terminate
the hosting agreement and any fees related to termination of the
hosting agreement are waived;
4. the Debtors will continue to pay the monthly fees under the
hosting agreement as such fees become due, through the closing
Date; and
5. the Debtors are authorized, but are not required, to
negotiate directly and thereafter enter into an agreement with
Rackspace, for web hosting services.
The Debtors also entered into a stipulation and agreed order with
San Juan Associates, LP which provides that:
1. the cure amount as of May 31, 2014, with respect to the
lease will be $3,107.
2. upon assumption and assignment to purchaser, if any,
purchaser will remain liable for and will pay when due, pursuant
to the terms of the lease, all accrued but not yet due items
under the lease. By way of example only, such items include 2014
taxes, 2014 percentage rent, and 2014 insurance.
About Buffet Partners
Buffet Partners, L.P., owns and operates Furr's Fresh Buffet, a
restaurant chain with 29 restaurants in Arizona, Arkansas, New
Mexico, Oklahoma and Texas. With a 65+ year operating history,
Furr's -- http://www.furrs.net/-- operates straight-line and
scatter-bar buffet units that feature a variety of all-you-can-eat
and home-cooked foods served at an affordable price. Buffet
Partners was formed to purchase Furr's in September 2003.
Headquartered in Plano, Texas, Buffet Partners and an affiliate
sought Chapter 11 protection in Dallas (Bankr. N.D. Tex. Case No.
Case No. 14-30699) on Feb. 4, 2014.
Attorneys at Baker & McKenzie LLP serve as counsel to the Debtors.
Bridgepoint Consulting is the financial advisor.
Buffet Partners disclosed $33,281,729 in assets and $48,926,256 in
liabilities as of the Chapter 11 filing.
William T. Neary, U.S. Trustee for Region 6, appointed five
creditors to serve in the Official Committee of Unsecured
Creditors. Bradford J. Sandler, Esq., at Pachulski Stang Ziehl &
Jones LLP serves as its counsel. Mesirow Financial Consulting,
LLC, serves as its financial advisors.
The restaurant was founded in 1946 by Roy Furr, and expanded to
approximately 60 locations as a family-owned business for over 35
years. In 1980, it was acquired by Kmart Corporation. Kmart
ultimately sold Furr's in a leveraged buy-out which subsequently
went public in 1986. Following a take-private transaction, the
Company entered a period of decline due to its debt burden,
culminating in a restructuring and reorganization under chapter 11
in 2003 in Dallas, Texas.
BUFFET PARTNERS: Has Until June 25 to Reject Inland Leases
----------------------------------------------------------
The Bankruptcy Court approved an agreed order extending Buffet
Partners, L.P., et al.'s lease rejection period with respect to a
certain lease of nonresidential real property.
Inland Diversified Dallas Wheatland, L.L.C., the landlord, and the
Debtor Buffet Partners, L.P. are parties to a lease of non-
residential real estate located at the intersection of Interstate
20 and Wheatland Road, Dallas, Texas.
The Debtor requested for an extension of the lease rejection
period until Sept. 2, and the landlord objected.
The parties entered into an agreed order which provides that,
among other things:
1. the deadline to assume or reject the lease is extended to
June 25, with prejudice to any further extension of the deadline;
2. the Debtor will effectively reject the lease no later than
June 25;
3. the effective date of rejection of the lease will be the
later of: (a) the date the Debtor surrenders the premises in broom
clean condition having removed any and all personal property,
including, but not limited to, all perishable and nonperishable
food and beverage items, to the landlord and (b) the date the
Debtor turns over all keys, key codes, and alarm codes for the
premises to the landlord;
4. the Debtor will remove all personal property from the
premises without causing damage to the premises;
5. any and all personal property left at the premises on the
Effective Date is deemed abandoned and the landlord is permitted
to dispose of any such personal property in its sole and absolute
discretion free and clear of any and all claims, liens, and
interests of the Debtors or any other person or entity, and
without liability to the Debtors or any other person or entity;
and
6. the landlord is granted an allowed administrative claim in
the amount of $24,739.58 for postpetition stub rent that accrued
with respect to the time period from Feb. 4, 2014, until Feb. 28;
The landlord is represented by:
John E. Mitchell, Esq.
Rosa A. Shirley, Esq.
BAKER & McKENZIE LLP
Trammel Crow Center
2001 Ross Avenue, Suite 2300
Dallas, TX 75201
Tel: (214) 978-3000
Fax: (214) 978-3099
- and -
Kevin M. Newman, Esq.
MENTER, RUDIN & TRIVELPIECE, P.C.
Office and Post Office Address
308 Maltbie Street, Suite 200
Syracuse, NY 13204-1498
Tel: (315) 474-7541
Fax: (315) 474-4040
About Buffet Partners
Buffet Partners, L.P., owns and operates Furr's Fresh Buffet, a
restaurant chain with 29 restaurants in Arizona, Arkansas, New
Mexico, Oklahoma and Texas. With a 65+ year operating history,
Furr's -- http://www.furrs.net/-- operates straight-line and
scatter-bar buffet units that feature a variety of all-you-can-eat
and home-cooked foods served at an affordable price. Buffet
Partners was formed to purchase Furr's in September 2003.
Headquartered in Plano, Texas, Buffet Partners and an affiliate
sought Chapter 11 protection in Dallas (Bankr. N.D. Tex. Case No.
Case No. 14-30699) on Feb. 4, 2014.
Attorneys at Baker & McKenzie LLP serve as counsel to the Debtors.
Bridgepoint Consulting is the financial advisor.
Buffet Partners disclosed $33,281,729 in assets and $48,926,256 in
liabilities as of the Chapter 11 filing.
William T. Neary, U.S. Trustee for Region 6, appointed five
creditors to serve in the Official Committee of Unsecured
Creditors. Bradford J. Sandler, Esq., at Pachulski Stang Ziehl &
Jones LLP serves as its counsel. Mesirow Financial Consulting,
LLC, serves as its financial advisors.
The restaurant was founded in 1946 by Roy Furr, and expanded to
approximately 60 locations as a family-owned business for over 35
years. In 1980, it was acquired by Kmart Corporation. Kmart
ultimately sold Furr's in a leveraged buy-out which subsequently
went public in 1986. Following a take-private transaction, the
Company entered a period of decline due to its debt burden,
culminating in a restructuring and reorganization under chapter 11
in 2003 in Dallas, Texas.
CAREFREE WILLOWS: July 16 Hearing to Confirm 5th Amended Plan
-------------------------------------------------------------
The Bankruptcy Court will convene a hearing on July 16, 2014, at
9:30 a.m., the hearing to consider the confirmation of the Fifth
Amended Plan of Reorganization filed by Alan R. Smith on behalf of
Carefree Willows LLC.
The Debtor has secured new financing, as well as an agreement to
contribute funds from its members or affiliates, to pay all of the
obligations.
Upon confirmation of the Plan, all property of the estate of the
Debtor will be re-vested in the Debtor which will retain property
as the Reorganized Debtor free and clear of all claims and
interests of the creditors.
A copy of the Fifth Amended Plan is available for free at
http://bankrupt.com/misc/CAREFREEWILLOWS_1186_5plan.pdf
The Debtor is represented by:
Alan R. Smith, Esq.
LAW OFFICES OF ALAN R. SMITH
505 Ridge Street
Reno, NV 89501
Tel: (775) 786-4579
Fax: (775) 786-3066
E-mail: mail@asmithlaw.com
About Carefree Willows LLC
Carefree Willows LLC is the owner of a 300-unit senior housing
complex, located 3250 S. Town Center Drive, in Las Vegas,
Nevada. Carefree Willows filed a Chapter 11 petition (Bankr. D.
Nev. Case No. 10-29932) on Oct. 22, 2010. The Law Offices of Alan
R. Smith, in Reno, Nevada, serves as counsel to the Debtor. The
Debtor disclosed $30,604,014 in assets and $36,531,244 in
liabilities as of the Chapter 11 filing.
CASH STORE: Ont. Superior Court of Justice Approves Sales Process
-----------------------------------------------------------------
Cash Store Financial on June 17 disclosed that the Ontario
Superior Court of Justice has approved a Sales Process whereby
prospective purchasers will have the opportunity to submit a bid
for the Company's property. Cash Store Financial's Chief
Restructuring Officer and Rothschild Inc. will conduct the Sales
Process with the oversight of the Court-appointed Monitor, FTI
Consulting Canada Inc.
Copies of the order of the Court, including details on the sales
process, as well as other details regarding the Company's CCAA
proceedings are available on the Monitor's website at
http://cfcanada.fticonsulting.com/cashstorefinancial
Cash Store Financial remains open for business with its branches
operating. Cash Store will continue to provide updates on its
restructuring and the Cash Store Transaction as matters advance.
About Cash Store Financial
Headquartered in Edmonton, Alberta, Cash Store Financial Services
Inc. (TSX: CSF) is a lender and broker of short-term advances and
provider of other financial services in Canada. Cash Store
Financial operates 510 branches across Canada under the banners
"Cash Store Financial" and "Instaloans". Cash Store Financial also
operates 27 branches in the United Kingdom.
Cash Store Financial is not affiliated with Cottonwood Financial
Ltd. or the outlets Cottonwood Financial Ltd. operates in the
United States under the name "Cash Store". Cash Store Financial
does not do business under the name "Cash Store" in the United
States and does not own or provide any consumer lending services
in the United States.
Cash Store Financial reported a net loss and comprehensive loss of
C$35.53 million for the year ended Sept. 30, 2013, as compared
with a net loss and comprehensive loss of C$43.52 million for the
year ended Sept. 30, 2012. As of Sept. 30, 2013, the Company had
C$164.58 million in total assets, C$165.90 million in total
liabilities and a C$1.32 million shareholders' deficit.
CENVEO CORP: Moody's Rates New $540MM 1st Lien Notes 'B3'
---------------------------------------------------------
Moody's Investors Service rated Cenveo Corporation's new $540
million 1st lien notes B3 and the new $250 million 2nd lien notes
Caa2. Cenveo's corporate family rating (CFR) and probability of
default rating (PDR) were affirmed at Caa1 and Caa1-PD
respectively. The ratings for the existing senior secured term
loan and 2nd lien notes were affirmed at B2 and Caa1,
respectively, and will be withdrawn upon expected repayment from
the new notes issues. At the same time, the company's senior
unsecured notes were affirmed at Caa3. Cenveo's speculative grade
liquidity rating (SGL) was also affirmed at SGL-3 (adequate
liquidity). The outlook remains stable.
The refinancing transaction reduces Cenveo's cost of capital, but
with the company's junior-most debt instrument still in place
($225 million, 11.5% unsecured notes due May 2017), Moody's sees
its timely and cost-effective refinance as uncertain, and with it,
so too is the sustainability of Cenveo's capital structure.
Proceeds from the $790 million of aggregate new debt and cash on
hand will be used to repay $737 million of existing debts ($328
million of existing term loan, $400 million of existing 2nd lien
notes, $9 million of existing unsecured term loan (unrated)) and
to pay fees, expenses, and accrued interest. Since the transaction
does not address elevated debt/EBITDA leverage (Moody's estimates
2015 debt/EBITDA at ~6x) and does not fully address refinancing
risks, Cenveo's Caa1 CFR remains unchanged. The new 1st lien and
2nd lien notes were rated one notch below the 1st lien and 2nd
lien notes being replaced since the 1st lien notes are increasing
in size while the new 2nd lien notes will be a smaller proportion
of total liability, providing less loss absorption for the senior
notes. The transaction has no material impact on Cenveo's
liquidity or its SGL-3 speculative graded liquidity rating
(adequate).
Cenveo Corporation is a wholly-owned subsidiary of Cenveo, Inc.
(Cenveo), a publicly traded holding company. While all debt
instruments are issued by Cenveo Corporation, since Cenveo Inc.
guarantees all of Cenveo Corporation's debt and financial
statements are issued only by Cenveo Inc., Moody's maintains
corporate-level ratings and the associated outlook at Cenveo Inc.
The following summarizes Cenveo's ratings and the rating actions:
Issuer: Cenveo Corporation
First Lien Notes assigned B3 (LGD3, 33%)
Second Lien Notes assigned Caa2 (LGD4, 63%)
Issuer: Cenveo Inc.
Corporate Family Rating, affirmed at Caa1
Probability of Default Rating, affirmed at Caa1-PD
Outlook, maintained at Stable
Speculative Grade Liquidity Rating, affirmed at SGL-3
Issuer: Cenveo Corporation
Senior Secured Term Loan, affirmed at B2 (LGD2, 26%) [will be
withdrawn in due course]
Senior Secured Second Lien Notes, affirmed at Caa1 (LGD4, 55%)
[will be withdrawn in due course]
Senior Unsecured Regular Bond/Debenture, affirmed at Caa3 with
the LGD Assessment revised to (LGD5, 86%) from (LGD5, 85%)
Ratings Rationale
Cenveo's Caa1 corporate family rating stems primarily from
uncertainty that its capital structure is sustainable. With
estimated 2014/2015 pro forma leverage of Debt-to-EBITDA in the
low-to-mid 6x range and with enterprise valuations being uncertain
and potentially being at similar multiples, refinancing without a
distressed exchange is questionable, especially as both envelope
converting and commercial printing are in secular decline. Cenveo
is involved in a protracted business and asset portfolio
restructuring aimed at diversifying away from legacy commercial
printing activities, the outcome of which is uncertain. The rating
benefits from the company's ability to generate free cash flow and
from an absence of near term debt maturities, both of which
provide time to complete the business restructuring and preclude a
potential financial restructuring.
Rating Outlook
The outlook is stable because Cenveo has time to continue its
business restructuring initiatives and because leverage and
coverage are expected to be relatively stable through 2014/2015.
What Could Change the Rating -- UP
Should it be clear that the company is cash flow self-sustainable
and it is likely they'll be able to refinance their debts,
positive ratings actions would be likely.
What Could Change the Rating -- DOWN
Cenveo's ratings could be downgraded if liquidity and refinance
issues arise in advance of the company's cash flow self-
sufficiency being proven.
Company Profile
Headquartered in Stamford, Connecticut, Cenveo Corporation, a
wholly-owned subsidiary of Cenveo, Inc. (Cenveo, a publicly traded
holding company), with estimated annual pro forma revenues of
about $2.0 billion, is involved in envelope converting (about 50%
of revenue, pro forma for the recent National Envelope
acquisition), commercial printing and related activities (about
30% of pro forma revenues), labels (about 15% of pro forma
revenues) and packaging (about 5% of pro forma revenues).
The principal methodology used in this rating was the Global
Publishing Industry Methodology 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.
COLDWATER CREEK: Gets Court Nod to Sell Real Property Leases
------------------------------------------------------------
The Bankruptcy Court approved (i) procedures for the assumption
and assignment of nonresidential real property leases; (ii)
bidding procedures to govern the sale of Coldwater Creek Inc., et
al.'s nonresidential real property leases; and (iii) cure
procedures.
The Debtors scheduled a July 8 auction at 10:00 a.m., at the
offices of Shearman & Sterling LLP located at 599 Lexington
Avenue, New York City. Qualified bids are due June 26.
The Court will consider the sale of the assets to ASJ Consulting,
LLC, or the winning bidder at a hearing on July 17, at 11:00 a.m.
On May 19, the Court authorized the Debtors to enter into an asset
purchase agreement with ASJ Consulting, LLC, purchaser for the
assets. ASJ Consulting emerged as the wining bidder at the
conclusion of the auction held on May 20. The back-up bidder was
Naturopathica Holistic Health Inc.
In a separate order, the Court entered a corrected order
authorizing the Debtors to (i) assume the purchase and sale
agreement with respect to real property located in Kootenai,
Idaho; (ii) perform settlement conditions pursuant to the purchase
and sale agreement; (iii) sell real property; (iv) assume certain
executory contract between Kootenai campus, LLC, purchaser and
Debtor dated April 9, 2014.
The corrected order replaced the order dated May 13.
On May 7, the Court entered an order (i) authorizing entry into an
agency agreement with a joint venture comprised of Hilco Merchant
Resources, LLC and Gordon Brothers retail Partners, LLC; (ii)
authorizing sale of assets and store closing sales.
After the conclusion of the auction held on May 1 and 2, the
Debtors determined in a valid and sound exercise of their business
judgment that the highest and best qualified bid for the asset
classes of (i) the inventory; (ii) furniture, fixtures and
equipment; (iii) intellectual property; and customer list.
On April 29, the Court ordered that the Master Consulting
Agreement between Gordon Brosthers Retail Partners, LLC and
Coldwater Creek U.S. effective as of Oct. 16, 2013, is terminated.
The Official Committee of Unsecured Creditors, in a supplemental
objection, stated that the Debtors' decision to conduct an
immediate liquidation of their business will only benefit their
secured creditors and certain parties that may be insiders. The
Committee believes that some or all of the nearly 6,000 jobs that
will thereby be lost in a liquidation can be saved and greater
value obtained for all interested parties -- particularly the
Debtors' unsecured creditors who are likely to receive no recovery
in the cases as they are presently postured -- if a brief,
dedicated effort were made to sell a material part of the Debtors'
business as going concern.
CPBP-VII Associates, landlord, filed a limited objection and
joinder the to objections filed by the other landlords to the
Debtor's motion to enter into an agency agreement for the Debtor's
Store No. 490, located at 923 Baltimore Pike, Glenn Mills
Pennsylvania.
CPBP-VII is represented by its agent:
Steven W. Kelley
SILVER & DEBOSKEY, P.C.
1801 York Street
Denver, CO 80206
Tel: (303) 399-3000
Fax: (303) 399-2650
About Coldwater Creek
Coldwater Creek is a multi-channel retailer that offers its
merchandise through retail stores across the country, its catalog
and its e-commerce Web site, http://www.coldwatercreek.com/
Originally founded in Sandpoint, Idaho in 1984 as a direct,
catalog-based marketer, Coldwater evolved into a multi-channel
specialty retailer operating 334 premium retail stores, 31 factory
outlet stores and seven day spa locations throughout the United
States.
As of the bankruptcy filing, the Debtors domestically employ a
total of approximately 5,990 employees throughout their retail
locations, corporate headquarters and distribution, design and
call centers.
Coldwater Creek Inc. and its debtor-affiliates sought Chapter 11
bankruptcy protection (Bankr. D. Del. Lead Case No. 14-10867) on
April 11, 2014, to liquidate their assets.
Coldwater Creek Inc. disclosed assets of $721,468,388 plus
undetermined amount and liabilities of $425,475,739 plus
undetermined amount. Affiliate Coldwater Creek U.S. Inc.
estimated $100 million to $500 million in assets and liabilities.
The Debtors have drawn $37.5 million and have approximately
$10 million in letters of credit outstanding under a senior
secured credit facility (ABL facility) provided by lenders led by
Wells Fargo Bank, National Association, as agent. The Debtors
also owe $96 million, which includes accrued interest and
approximately $23 million representing a prepayment premium
payable, under a term loan from lenders led by CC Holding Agency
Corporation, as agent. Aside from the funded debt, the Debtors
have accumulated a significant amount of accrued and unpaid trade
and other unsecured debt in the normal course of their business.
The Debtors have tapped Young Conaway Stargatt & Taylor, LLP, and
Shearman & Sterling LLP as attorneys, Perella Weinberg Partners LP
as financial advisor, Alvarez & Marsal as restructuring advisor,
and Prime Clerk LLC as claims and noticing agent.
The U.S. Trustee for Region Three named seven creditors to serve
on the official committee of unsecured creditors. Lowenstein
Sandler LLP represent the Committee.
CONVERSANT INTELLECTUAL: S&P Withdraws 'B' Rating
-------------------------------------------------
Standard & Poor's Ratings Services said it withdrew its ratings on
Conversant Intellectual Property Management Inc., including its
'B' long-term corporate credit rating on the company, at the
issuer's request. All rated debt was paid in full as part of the
company's recently completed refinancing.
CSN HOUSTON: Haynes and Boone, Conway File Fee Applications
-----------------------------------------------------------
David Barron, writing for The Houston Chronicle, reported that
attorneys and consultants representing Comcast SportsNet Houston
have rung up more than $850,000 in fees and expenses since last
February, and they filed motions with the court this week asking
to be paid:
1. the Houston office of the Haynes and Boone law firm is
seeking payment of $579,599.10 for more than a thousand hours that
attorneys and staff members have devoted to the CSN Houston case
from February through April 30. The firm also seeks payment of
$2,172.42 in expenses. The hourly rates for the firm's attorneys
range from $369 to $810 an hour;
2. Consulting firm Conway MacKenzie is seeking payment of
$218,213.80 for 499 hours of work by its employees through April
30, at an average cost of $436.98, in its capacity as financial
adviser to CSN Houston.
The Houston Chronicle also reported that:
-- A recent budget submitted to the court estimated the
network would bring in about $8.8 million in advertising and
affiliate revenue from the 13-week period from mid-June through
early September; and
-- Attorneys are schedule to update U.S. Bankruptcy Judge
Marvin Isgur on the progress of the case on July 2.
About Houston Regional Sports Network
An involuntary Chapter 11 bankruptcy petition was filed against
Houston Regional Sports Network, L.P. d/b/a Comcast SportsNet
Houston (Bankr. S.D. Tex. Case No. 13-35998) on Sept. 27, 2013.
The involuntary filing was launched by three units of Comcast/NBC
Universal and a television-related company. The petitioners are:
Houston SportsNet Finance LLC, Comcast Sports Management Services
LLC, National Digital Television Center LLC, and Comcast SportsNet
California, LLC.
The petitioning creditors have filed papers asking the Bankruptcy
Judge to appoint an independent Chapter 11 trustee "to conduct a
fair and open auction process for the Network's business assets on
a going concern basis."
Houston Regional Sports Network is a joint enterprise among
affiliates of the Houston Astros baseball team, the Houston
Rockets basketball team, and Houston SportsNet Holdings, LLC --
"Comcast Owner" -- an affiliate of Comcast Corporation. The
Network has three limited partners -- Comcast Owner, Rockets
Partner, L.P., and Astros HRSN LP Holdings LLC. The primary
purpose of Houston Regional Sports Network is to create and
operate a regional sports programming service that produces,
exhibits, and distributes sports programming on a full-time basis,
including live Astros and Rockets games within the league-
permitted local territories.
Counsel for the petitioning creditors are Howard M. Shapiro, Esq.,
at Wilmer Cutler Pickering Hale and Dorr LLP; George W. Shuster,
Jr., Esq., at Wilmer Cutler Pickering Hale and Dorr LLP; Vincent
P. Slusher, Esq., at DLA Piper; and Arthur J. Burke, Esq., at
Davis Polk & Wardwell LLP.
Judge Marvin Isgur presides over the case.
The Network was officially placed into Chapter 11 bankruptcy
pursuant to a Feb. 7 Order for Relief. It has won approval to
hire Haynes and Boone, Charles A. Beckham, Jr., Esq., Henry
Flores, Esq., Abigail Ottmers, Esq., and Christopher L. Castillo,
Esq., as counsel. It also hired Conway MacKenzie, Inc., as
financial advisor.
Harry Perrin, Esq., represents Astros owner Jim Crane. Alan
Gover, Esq., represents the Rockets.
The Astros are represented by Richard B. Drubel, Esq., Colleen A.
Harrison, Esq., and Jonathan R. Voegele, Esq., at Boies, Schiller
& Flexner LLP, in Hanover, NH; and Scott E. Gant, Esq., at Boies,
Schiller & Flexner in Washington, DC. Comcast Corporation and
NBCUniversal Media, LLC, are represented by Vincent P. Slusher,
Esq., Eli Burriss, Esq., Andrew Mayo, Esq., and Andrew Zollinger,
Esq., at DLA Piper; Arthur J. Burke, Esq., Timothy Graulich, Esq.,
and Dana M. Seshens, Esq., at Davis Polk & Wardwell LLP; and
Howard M. Shapiro, Esq., and Craig Goldblatt, Esq., at Wilmer
Cutler Pickering Hale and Dorr LLP. Attorney for McLane
Champions, LLC and R. Drayton McLane, Jr., are Wayne Fisher, Esq.,
at Fisher Boyd & Huguenard, LLP.
D & L ENERGY: Resource Land Sues Over Sale Transaction
------------------------------------------------------
Resource Land Holdings, LLC, filed an adversary proceeding against
D&L Energy, Inc., and Petroflow, Inc., to remedy numerous material
breaches under an asset purchase agreement dated November 27,
2013.
Resource Land, which offered $20.7 million for substantially all
of D&L Energy and Petroflow's assets, identifies numerous defects
in the assets, including breaches of the representations and
warranties. Resource Land wants to compel the return of over
$2 million in deposits and to recover the damages it has incurred
as a result of the alleged breaches.
Andrew J. Petrie, Esq., at Ballard Spahr LLP, in Denver, Colorado,
notes that Resource Land has made every effort to work the
sellers, the official committee of unsecured creditors, and the
Lupos to resolve the disputes. It was only when those efforts were
not successful that Resource Land terminated the purchase
agreement, explains Mr. Petrie.
Resource Land demands a trial by jury pursuant to Rule 38 of the
Federal Rules of Civil Procedure and Rule 9015 of the Federal
Rules of Bankruptcy Procedure.
Resource Land seeks for a judgment in its favor against the
sellers, finding that they breached the purchase agreement and
awarding damages. Resource Land further seeks a declarative
judgment that:
(a) it timely and properly identified and notified sellers of
the existence and specific nature of defects;
(b) it timely and properly identified and notified the sellers
of the existence of their breaches of their representations
and warranties made in the purchase agreement, as well as
their breaches of other provisions of the purchase
agreement;
(c) the purchase agreement provides it with two principal
remedies that afford it three paths on which it can
proceed:
(1) it can acquire some assets subject to a price
reduction;
(2) for some assets, it has the remedies for seller's
breaches of representations and warranties, or material
breaches of other provisions of the purchase agreement,
up to termination; and
(3) it has the remedies for breaches of representations and
warranties, or material breaches of other provisions of
the purchase agreement, up to termination;
(d) it properly terminated the purchase agreement; and
(e) it is entitled to the return of the $2.47 million deposit
amounts without setoff or deduction of any kind.
Resource Land is represented by:
Andrew J. Petrie
BALLARD SPAHR LLP
1225 Seventeenth Street, Suite 2300
Denver, CO 80202-5596
Telephone: 303-292-2400
Facsimile: 303-296-3956
petriea@ballardspahr.com
About D & L Energy
D & L Energy, Inc., based in Youngstown, Ohio, was formed by David
DeChristofaro, Ben Lupo, and James Beshara in 1986 to be a
conventional oil and gas well operator and producer, primarily
targeting oil and gas reserves in the Clinton Sandstone formation
throughout Northeast Ohio and Northwest Pennsylvania. D&L
currently has three (3) shareholders, Ben Lupo (80.76%
shareholder), Susan Faith (15% shareholder), and Holly Serensky
Lupo (4.24% shareholder). Nicholas C. Paparodis is the acting CEO
and President of D&L. Kathy Kaniclides is the acting Secretary
and Treasurer of D&L. Currently, Serensky Lupo is the sole
director of D&L.
Petroflow, Inc., is an Ohio corporation which is a wholly owned
subsidiary of D&L. Originally intended to operate as the
"drilling arm" of D&L, Petroflow ceased all operations prior to
the filing of these bankruptcy matters. Petroflow has no current
income, no bank accounts, and no employees. Paparodis is the
president, CEO and sole director of Petroflow.
D&L and Petroflow filed for Chapter 11 bankruptcy (Bankr. N.D.
Ohio Lead Case No. 13-40813) on April 16, 2013. Judge Kay Woods
oversees the case.
The Debtor disclosed in its amended schedules, $40,615,677 in
assets and $6,187,217 in liabilities as of the Chapter 11 filing.
Brian T. Angeloni, Esq., Kathryn A. Belfance, Esq., Steven
Heimberger, Esq., and Todd A. Mazzola, Esq., at Roderick Linton
Belfance, LLP, serve as the Debtors' counsel, and Walter
Haverfield, LLP, is the environmental counsel. SS&G Parkland
Consulting, LLC, serves as financial advisor and investment
banker.
Sherri Lynn Dahl, Esq., and Peter R. Morrison, Esq., at Squire
Sanders (US) LLP, have been tapped as counsel to the official
committee of unsecured creditors. BBP Partners LLC serves as the
panel's financial advisors.
Resource Land Holdings emerged as the winning bidder for the
substantially all of the Debtor's assets. Resource Land offered
to buy the assets for $20.4 million.
D & L ENERGY: Court Approves Settlement with Oscar Sterle
---------------------------------------------------------
The Bankruptcy Court approves a settlement between D&L Energy,
Inc., Petroflow, Inc., and Oscar Sterle, M.D., entered on
May 9, 2014.
Dr. Sterle is successor-in-interest to an oil and gas lease with
D&L Energy, wherein a dispute arose regarding performance on the
lease. The dispute resulted to a civil action against D&L Energy
in the Trumbull County Common Pleas Court, which was stayed as a
result of D&L Energy's filing for Chapter 11 bankruptcy.
The parties have resolved their differences and agree that:
(a) D&L Energy will pay Dr. Sterle $3,500 in full and complete
settlement of the parties' dispute;
(b) Dr. Sterle gives D&L Energy full and complete release of
all claims from any of the parties oil and gas leases;
(c) D&L Energy is permitted to assume or assign all oil and gas
leases, to which Dr. Sterle is a party, free and clear of
limitations and restrictions; and
(d) Dr. Sterle will assume and forever hold D&L Energy harmless
from payment of third party claims that may be presented by
Chesapeake Exploration, LLC, Everflow Easter, Inc., Ohio
Buckeye Energy, LLC, or any affiliates.
D&L Energy is represented by:
Kathryn A. Belfance
Lawrence R. Bach
Todd A. Mazzola
Brian T. Angeloni
Steven J. Heimberger
One Cascade Plaza, Suite 1500
Akron, OH 44308
Tel: (330) 434-3000
Fax: (330) 434-9220
E-mail: kb@rlbllp.com
lbach@rlbllp.com
tmazzola@rlbllp.com
bangeloni@rlbllp.com
sheimberger@rlbllp.com
Dr. Sterle is represented by:
Marty D. Nosich
143 W. Main St.
Cortland, OH 44410
Tel: (330) 638-1529
Fax: (330) 638-1526
E-mail: mnosichlaw@yahoo.com
About D & L Energy
D & L Energy, Inc., based in Youngstown, Ohio, was formed by David
DeChristofaro, Ben Lupo, and James Beshara in 1986 to be a
conventional oil and gas well operator and producer, primarily
targeting oil and gas reserves in the Clinton Sandstone formation
throughout Northeast Ohio and Northwest Pennsylvania. D&L
currently has three (3) shareholders, Ben Lupo (80.76%
shareholder), Susan Faith (15% shareholder), and Holly Serensky
Lupo (4.24% shareholder). Nicholas C. Paparodis is the acting CEO
and President of D&L. Kathy Kaniclides is the acting Secretary
and Treasurer of D&L. Currently, Serensky Lupo is the sole
director of D&L.
Petroflow, Inc., is an Ohio corporation which is a wholly owned
subsidiary of D&L. Originally intended to operate as the
"drilling arm" of D&L, Petroflow ceased all operations prior to
the filing of these bankruptcy matters. Petroflow has no current
income, no bank accounts, and no employees. Paparodis is the
president, CEO and sole director of Petroflow.
D&L and Petroflow filed for Chapter 11 bankruptcy (Bankr. N.D.
Ohio Lead Case No. 13-40813) on April 16, 2013. Judge Kay Woods
oversees the case.
The Debtor disclosed in its amended schedules, $40,615,677 in
assets and $6,187,217 in liabilities as of the Chapter 11 filing.
Brian T. Angeloni, Esq., Kathryn A. Belfance, Esq., Steven
Heimberger, Esq., and Todd A. Mazzola, Esq., at Roderick Linton
Belfance, LLP, serve as the Debtors' counsel, and Walter
Haverfield, LLP, is the environmental counsel. SS&G Parkland
Consulting, LLC, serves as financial advisor and investment
banker.
Sherri Lynn Dahl, Esq., and Peter R. Morrison, Esq., at Squire
Sanders (US) LLP, have been tapped as counsel to the official
committee of unsecured creditors. BBP Partners LLC serves as the
panel's financial advisors.
Resource Land Holdings emerged as the winning bidder for the
substantially all of the Debtor's assets. Resource Land offered
to buy the assets for $20.4 million.
DELRAY FLORIDA: Case Summary & 6 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Delray Florida Properties, LLC
Parkway Plaza
200 Campbell Drive. #200
Willingboro, NJ 08046
Case No.: 14-23859
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: June 17, 2014
Court: United States Bankruptcy Court
Southern District of Florida (West Palm Beach)
Debtor's Counsel: Daniel R. Brinley, Esq..
LAW OFFICES OF DANIEL R. BRINLEY, PA
712 US Hwy One #400
North Palm Beach, FL 33408
Tel: 561-844-3600
Email: drb@fcohenlaw.com
Total Assets: $4.51 million
Total Liabilities: $11.81 million
The petition was signed by Thomas E. Juliano, manager.
A list of the Debtor's six largest unsecured creditors is
available for free at http://bankrupt.com/misc/flsb14-23859.pdf
EASTMAN KODAK: Trust Resolving Clawback Suits
---------------------------------------------
Matthew Daneman, writing for The Democrat & Chronicle, reported
that the Kodak General Unsecured Creditors Trust filed roughly 750
in U.S. Bankruptcy Court in January, seeking to claw back hundreds
of millions of dollars in "preferential" payments that were made
in the 90 days leading up to its filing for bankruptcy. The
report said about a third of the cases have been settled or
dropped, according to U.S. Bankruptcy Court filings. The court
documents give no details on the settlements.
The report noted that unsecured creditors have been slated to
recoup 4 to 5 cents on the dollar, plus options to buy Kodak
stock. Any money the trust raises is to go to the unsecured
creditors.
Alan D. Halperin, Esq., a partner at New York law firm Halperin
Battaglia Raicht LLP, serves as trustee to the Kodak trust.
About Eastman Kodak
Rochester, New York-based Eastman Kodak Company and its U.S.
subsidiaries on Jan. 19, 2012, filed voluntarily Chapter 11
petitions (Bankr. S.D.N.Y. Lead Case No. 12-10202) in Manhattan.
Subsidiaries outside of the U.S. were not included in the filing
and are expected to continue to operate as usual.
Kodak, founded in 1880 by George Eastman, was once the world's
leading producer of film and cameras. Kodak sought bankruptcy
protection amid near-term liquidity issues brought about by
steeper-than-expected declines in Kodak's historically profitable
traditional businesses, and cash flow from the licensing and sale
of intellectual property being delayed due to litigation tactics
employed by a small number of infringing technology companies
with strong balance sheets and an awareness of Kodak's liquidity
challenges.
In recent years, Kodak had been working to transform itself from
a business primarily based on film and consumer photography to a
smaller business with a digital growth strategy focused on the
commercialization of proprietary digital imaging and printing
technologies. Kodak has 8,900 patent and trademark registrations
and applications in the United States, as well as 13,100 foreign
patents and trademark registrations or pending registration in
roughly 160 countries.
Attorneys at Sullivan & Cromwell LLP and Young Conaway Stargatt &
Taylor, LLP, serve as counsel to the Debtors. FTI Consulting,
Inc., is the restructuring advisor. Lazard Freres & Co. LLC, is
the investment banker. Kurtzman Carson Consultants LLC is the
claims agent.
The Official Committee of Unsecured Creditors has tapped Milbank,
Tweed, Hadley & McCloy LLP, as its bankruptcy counsel.
Michael S. Stamer, Esq., David H. Botter, Esq., and Abid Qureshi,
Esq., at Akin Gump Strauss Hauer & Feld LLP, represent the
Unofficial Second Lien Noteholders Committee.
The Retirees Committee has hired Haskell Slaughter Young &
Rediker, LLC, and Arent Fox, LLC as Co-Counsel; Zolfo Cooper,
LLC, as Bankruptcy Consultants and Financial Advisors; and the
Segal Company, as Actuarial Advisors.
Robert J. Stark, Esq., Andrew Dash, Esq., and Neal A. D'Amato,
Esq., at Brown Rudnick LLP, represent Greywolf Capital Partners
II; Greywolf Capital Overseas Master Fund; Richard Katz, Kenneth
S. Grossman; and Paul Martin.
Kodak completed the $527 million sale of digital-imaging
technology on Feb. 1, 2013. Kodak intends to reorganize by
focusing on the commercial printing business.
At the end of April 2013, Kodak filed a reorganization plan
offering 85 percent of the stock to holders of the remaining
$375 million in second-lien notes. The other 15 percent is for
unsecured creditors with $2.7 billion in claims and retirees who
have a $635 million claim from the loss of retirement benefits.
U.S. Bankruptcy Judge Allan Gropper confirmed the plan on August
20, 2013. Kodak and its affiliated debtors officially emerged
from bankruptcy protection on Sept. 3, 2013.
Mark S. Burgess, Matt Doheny, John A. Janitz, George Karfunkel,
Jason New and Derek Smith became members of Kodak's new board of
directors as of Sept. 3, 2013. Existing directors James V.
Continenza, William G. Parrett and Antonio M. Perez will continue
their service as members of the new board.
ECOTALITY INC: Asks Court to Extend Plan Exclusivity to Aug. 28
---------------------------------------------------------------
Electric Transportation Engineering Corporation, doing business as
ECOtality North America, and its other jointly administered
debtors in the Chapter 11 cases ask the Bankruptcy Court to extend
the exclusive periods to file a plan of reorganization through
August 13, 2014, and to solicit acceptances of that plan through
October 12, 2014.
The current exclusive periods will expire on June 29, 2014, and
August 28, 2014. This is the fifth request for an extension of
the exclusive periods.
As a result of an auction in October 2013, it was determined that
the best bids for the sale of substantially all of ECOtality's
assets were by Blink Acquisition LLC, Access Control Group, LLC,
and Intertek Testing Services NA, Inc., for an aggregate purchase
price of $4.335 million, with each party agreeing to purchase
certain assets associated with their businesses.
Jared G. Parker, Esq., at Parker Schwartz, PLLC, in Dallas, Texas,
explains that since the closing of the sales, ECOtality and their
advisors have focused primarily on winding down the estates and
evaluating various plan structures to determine the best vehicle
for maximizing creditor recoveries.
Mr. Parker notes that although there was a reorganization plan
proposed by Blink, Blink failed to provide important information
to evaluate the proposed plan. Based upon the information
available at the time, ECOtality and the official committee of
unsecured creditors determined that a plan of liquidation would
maximize the value of the estates for the benefit of creditors.
ECOtality, in collaboration with the creditors committee, have
drafted a plan of liquidation, an accompanying disclosure
statement and solicitation materials. They intended to file the
proposed plan of liquidation during the week of May 18, 2014.
However, just before that, Blink re-engaged in discussions
regarding its plan.
Mr. Parker relates that ECOtality and the creditors committee
still require substantial additional information from Blink to
make an informed judgment and have urged Blink to provide
information promptly. Assuming the information is provided in a
timely fashion, ECOtality intend to re-evaluate the
appropriateness of Blink's proposal. If the information is not
provided in on time or ECOtality determine that Blink's proposal
is not the most appropriate approach with regard to maximizing
value, then ECOtality will file and solicit votes on the currently
contemplated plan of liquidation.
Under these circumstances, Mr. Parker stresses that a 45-day
extension of the exclusive periods, supported by the creditors
committee, will provide sufficient time for them to file a plan
that best maximizes the value of their estates for the benefit of
creditors.
ECOtality is represented by:
Charles R. Gibbs, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
1700 Pacific Avenue
Dallas, TX 75201
Telephone: (214) 969-2800
Facsimile: (214) 969-4343
E-mail: cgibbs@akingump.com
- and -
David P. Simonds, Esq.
Arun Kurichety, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
2029 Century Park East, Suite 2400
Los Angeles, CA 90067
Telephone: (310) 229-1000
Facsimile: (310) 229-1001
E-mail: dsimonds@akingump.com
akurichety@akingump.com
- and -
Jared G. Parker, Esq.
Parker Schwartz, PLLC
7310 N. 16th St., Suite 330
Phoenix, AZ 85020
Telephone: (602) 282-0476
Facsimile: (602) 282-0478
E-mail: jparker@psazlaw.com
About Ecotality Inc.
Headquartered in San Francisco, California, Ecotality, Inc.
(Nasdaq: ECTY) -- http://www.ecotality.com-- is a provider of
electric transportation and storage technologies.
Ecotality Inc. along with affiliates including lead debtor
Electric Transportation Engineering Corp. sought Chapter 11
protection (Bankr. D. Ariz. Lead Case No. 13-16126) on Sept. 16,
2013, with plans to sell the business at an auction.
The cases are assigned to Chief Judge Randolph J. Haines. The
Debtors' lead counsel are Charles R. Gibbs, Esq., at Akin Gump
Strauss Hauer & Feld LLP, in Dallas, Texas; and David P. Simonds,
Esq., and Arun Kurichety, Esq., at Akin Gump Strauss Hauer & Feld
LLP, in Los Angeles, California. The Debtors' local counsel is
Jared G. Parker, Esq., at Parker Schwartz, PLLC, in Phoenix,
Arizona. FTI Consulting, Inc. serves as the Debtors' crisis
manager and financial advisor. The Debtors' claims and noticing
agent is Kurtzman Carson Consultants LLC.
Electric Transportation estimated assets of $10 million to $50
million and debt of $100 million to $500 million. Unlike most
companies in bankruptcy, Ecotality has no secured debt. It simply
ran out of money. There's $5 million owing on convertible notes,
plus liability on leases. Part of pre-bankruptcy financing took
the form of a $100 million cost-sharing grant from the U.S. Energy
Department. In view of the San Francisco-based company's
financial problems, the government cut off the grant when $84.8
million had been drawn.
On Sept. 24, 2013, the Office of the United States Trustee for
Region 14 appointed a committee of unsecured creditors.
In October 2013, the bankruptcy judge cleared Ecotality to sell
most of the business to Car Charging Group Inc. for $3.3 million.
Two other buyers purchased other assets for $1 million in total.
EDGENET INC: May Reject Duke Realty & Rehab Doc Agreements
----------------------------------------------------------
U.S. Bankruptcy Judge Brendan Shannon authorized Edgenet, Inc., et
al., to walk away from these unexpired leases and unexpired
subleases nunc pro tunc to April 1, 2014:
Governing
Document Date Address Expiration
--------- ---- ------- ----------
Office Lease between March 31, Suites 300 Aug. 31, 2015
Duke Realty Limited 2010 and 350 of
Partnership and the building
Edgenet, Inc. located at 12
Cadillac Drive,
Brentwood, TN
37027
Sublease Agreement March 16, Suites 300 Aug. 31, 2015
between Edgenet Inc. 2012 and 350 of
and the Rehab the building
Documentation located at 12
Company, Inc. Cadillac Drive
Brentwood, TN
37027
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;
GlassRatner 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 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.
Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed on
March 13, 2014, five noteholders to serve on the Official
Committee of Note Holders. In May, Bankruptcy Judge Brendan L.
Shannon denied Edgenet Inc., et al.'s motion to disband the
Noteholders Committee.
The Noteholders Committee has retained Morris James LLP's Jeffrey
R. Waxman, Esq.; and Cooley LLP's Cathey Hershcopf, Esq., and
Jeffrey L. Cohen, Esq., as co-counsel to the Committee.
EDGENET INC: May Sell Assets to EdgeAQ LLC for $7.98MM Cash
-----------------------------------------------------------
The U.S. Bankruptcy Court entered an order (i) authorizing
Edgenet, Inc., et al., to enter into an asset purchase agreement
dated June 6, 2014, with EdgeAQ, LLC; (ii) approving the sale of
the Debtors' assets to EdgeAQ LLC or its designee; and (iii)
approving the assumption and assignment of certain executory
contracts and unexpired leases.
EdgeAQ was the successful bidder at an auction. Pursuant to the
APA, the buyer will purchase the assets for (i) $7,980,000 cash;
plus (ii) assumption of certain liabilities. EdgeAQ LLC was
formed by three former principals of the Debtors.
Edgenet Inc. had a deal with a unit of Parallax Capital Partners
LLC to serve as stalking horse bidder at the auction that was to
be held not later than June 3. The Parallax unit, PCF Number 2
Inc. in Laguna Hills, California, offered $6.5 million.
As reported by the Troubled Company Reporter on June 9, the
Bankruptcy Court agreed to move the timetable of the sale to allow
EdgeAQ four extra days to put together a bid. According to a
report by Law360, the Court's decision came in response to an
emergency motion filed by three former employees who formed
EdgeAQ, who sought additional time to arrange financing for a
competing offer.
EdgeAQ LLC sought extension of the bid deadline and auction date.
The Official Committee of Noteholders and Ernest Wu filed a
joinder to that motion, which seeks a two-week extension of the
bid deadline and auction and sale hearing dates.
The Debtors filed an omnibus objection to the EdgeAQ LLC's
extension motion. Liberty Partners Lenders, L.L.C., filed a
joinder to the Debtor's omnibus objection.
The Debtors said that to change the sale process now is
unjustified and further delay will only expose the Debtors, their
estates and their creditors to unwarranted risk of harm.
According to Liberty Partners, the Debtors have worked towards
completing a fair and successful sale process to maximize the
value of their estates. Now, EdgeAQ LLC sought to thwart the
significant progress made in the cases with an ill-timed, eleventh
hour request.
Meanwhile, Roberta A. DeAngelis, the United States Trustee for
Region 3, had objected to certain findings of fact and conclusions
of law in the proposed sale order that go significantly beyond the
protections provided to buyers under Section 363 of the Bankruptcy
Code, and are otherwise inappropriate in a sale order.
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 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.
EDGENET INC: July 10 Hearing on Noteholders' Bid to Convert Case
----------------------------------------------------------------
The U.S. Bankruptcy Court will convene a hearing on July 10, 2014,
at 12:00 p.m., to consider the motion to convert the Chapter 11
cases of Edgenet, Inc. et al., to those under Chapter 7 of the
Bankruptcy Code. Objections, if any, are due June 27 at
4:00 p.m.
The Official Committee of Noteholders seek case conversion, saying
the Debtors, after selling the assets, have nothing further to
achieve in the Chapter 11.
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 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.
Roberta A. DeAngelis, the U.S. Trustee for Region 3, appointed on
March 13, 2014, five noteholders to serve on the Official
Committee of Note Holders. In May, Bankruptcy Judge Brendan L.
Shannon denied Edgenet Inc., et al.'s motion to disband the
Noteholders Committee.
The Noteholders Committee has retained Morris James LLP's Jeffrey
R. Waxman, Esq.; and Cooley LLP's Cathey Hershcopf, Esq., and
Jeffrey L. Cohen, Esq., as co-counsel to the Committee.
ENERGY FUTURE: Provides Update on EFIH Second Lien Settlement
-------------------------------------------------------------
In a regulatory filing with the Securities and Exchange Commission
on June 13, Energy Future Holdings Corp. and Energy Future
Intermediate Holding Company LLC provided updates on the offer by
EFIH and EFIH Finance Inc. to holders of the Issuer's outstanding
11% Senior Secured Second Lien Notes due 2021 and 11.750% Senior
Secured Second Lien Notes due 2022 to participate in a voluntary
settlement with respect to the Issuer's obligations under the EFIH
Second Lien Notes held by those holders.
Pursuant to a Restructuring Support and Lock-Up Agreement, dated
as of April 29, 2014, as amended from time to time, certain
holders of EFIH Second Lien Notes holding, in the aggregate,
approximately 35% of the aggregate outstanding principal amount of
EFIH Second Lien Notes -- RSA EFIH Second Lien Note Parties --
agreed to a voluntary settlement with respect to the Issuer's
obligations under the EFIH Second Lien Notes held by the RSA EFIH
Second Lien Note Parties.
On Friday, the Debtors disclosed that as of June 11, 2014 -- the
Early Participation Date -- and after giving effect to the RSA
EFIH Second Lien Settlement and the participation in the Offer as
of that date, holders of the principal amounts and the percentages
of outstanding principal amounts listed in the table below of each
series of EFIH Second Lien Notes had agreed to participate in the
EFIH Second Lien Settlement:
Aggregate Percentage of
Principal Outstanding
Aggregate Amount Principal
Principal Participating Amount
Amount in Second Lien Participating
Outstanding Settlement in Second Lien
Securities (in $000's) (in $000's) Settlement
---------- ----------- -------------- --------------
EFIH 11% $406.392 $235.851 58%
Second Lien
Notes
CUSIP No.
29269QAB3
EFIH 11.750% $1,750.000 $686.573 39%
Second Lien
Notes
CUSIP Nos.
29269QAD9
U29197AB3
---------- ----------- -------------- --------------
Total EFIH $2,156.392 $922.424 43%
Second Lien
Notes
The Offer will expire at 5:00 p.m., New York City time, on July 3,
2014, unless extended by the Issuer in its sole discretion.
Accordingly, the principal amounts of EFIH Second Lien Notes and
percentages of EFIH Second Lien Notes shown in the table above as
participating in the EFIH Second Lien Settlement are subject to
change. he Issuer does not intend to permit the offer period for
the EFIH Second Lien Settlement to expire prior to the date the
EFIH Second Lien Settlement is heard, and approved, by the U.S.
Bankruptcy Court for the District of Delaware.
Meanwhile, in a regulatory filing on June 11, 2014, EFIH and EFIH
Finance Inc. issued a press release announcing that the expiration
date of the Issuer's previously announced offer to holders of the
Issuer's 6.875% Senior Secured Notes due 2017 and 10.000% Senior
Secured Notes due 2020 -- EFIH First Lien Notes -- to participate
in a voluntary settlement with respect to the Issuer's obligations
under the EFIH First Lien Notes -- EFIH First Lien Settlement --
has been extended to 11:59 p.m., New York City time, on June 11,
2014. The Bankruptcy Court for the District of Delaware has
issued an order approving, subject to a stay of such order until
12:01 a.m., New York City time, on June 12, 2014, (i) the
voluntary settlement provided for in the EFIH First Lien
Settlement and (ii) the Issuer's entry into a new senior secured
super-priority debtor-in-possession credit agreement. Other than
the extension of the Expiration Date, the terms of the Offer are
unchanged.
The Offer, according to the Debtors, is open to all qualified
holders of the Issuer's 6.875% Senior Secured Notes due 2017 and
10.000% Senior Secured Notes due 2020 -- EFIH First Lien Notes.
As of 5:00 p.m., New York City time, on June 10, 2014,
approximately $0.42 billion of EFIH First Lien Notes
(approximately 10% of the outstanding EFIH First Lien Notes) had
been submitted for exchange in the Offer. In addition, pursuant to
the Restructuring Support and Lock-Up Agreement, dated April 28,
2014 (as amended), to which the Issuer is a party, certain holders
holding, in the aggregate, approximately $1.26 billion of EFIH
First Lien Notes (approximately 32% of the outstanding EFIH First
Lien Notes) have agreed to the EFIH First Lien Settlement on the
terms provided in such agreement.
About Energy Future Holdings, fka TXU Corp.
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a portfolio
of competitive and regulated energy businesses in Texas. Oncor,
an 80 percent-owned entity within the EFH group, is the largest
regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS). The Debtors are seeking to have their cases
jointly administered for procedural purposes.
As of Dec. 31, 2013, EFH Corp. reported total assets of $36.4
billion in book value and total liabilities of $49.7 billion. The
Debtors have $42 billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring
agreement are represented by Akin Gump Strauss Hauer & Feld LLP,
as legal advisor, and Centerview Partners, as financial advisor.
The EFH equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for
the second-lien noteholders owed about $1.6 billion, is
represented by Ashby & Geddes, P.A.'s William P. Bowden, Esq., and
Gregory A. Taylor, Esq., and Brown Rudnick LLP's Edward S.
Weisfelner, Esq., Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq.,
Jeremy B. Coffey, Esq., and Howard L. Siegel, Esq.
An Official Committee of Unsecured Creditors has been appointed in
the case. The Committee represents the interests of the unsecured
creditors of ONLY of Energy Future Competitive Holdings Company
LLC; EFCH's direct subsidiary, Texas Competitive Electric Holdings
Company LLC; and EFH Corporate Services Company, and of no other
debtors. The Committee has selected Morrison & Foerster LLP and
Polsinelli PC for representation in this high-profile energy
restructuring. The lawyers working on the case are James M. Peck,
Esq., Brett H. Miller, Esq., and Lorenzo Marinuzzi, Esq., at
Morrison & Foerster LLP; and Christopher A. Ward, Esq., Justin K.
Edelson, Esq., Shanti M. Katona, Esq., and Edward Fox, Esq., at
Polsinelli PC.
EVENT RENTALS: Wind-Down Budget Agreement Approved
--------------------------------------------------
Judge Peter Walsh signed an agreed order approving a letter
agreement between debtors Event Rentals Inc., et al., regarding a
wind-down budget. The order supplements the previous order
approving the compromise and settlement agreement between the
parties.
Pursuant to the agreement, the parties resolved certain issues
relating to the disbursement of the proceeds of the sale of the
Debtors' assets and satisfaction of certain claims.
Among other things, the agreement established: (i) a reserve for
satisfying disputed sales tax claims against the Debtors; and (ii)
a reserve for satisfying Claims against the Debtors secured by
liens in property of the Debtors sold pursuant to the sale that
were senior in priority to the prepetition lenders' liens.
Pursuant to the agreement, the Debtors are entitled to apply
excess funds in the disputed sales tax claims reserve and the
prepetition prior secured creditor reserve to pay priority tax
claims and secured claims, and any excess not so applied must be
returned to the prepetition agent. The Debtors are prohibited
from paying "disputed sales tax claims" or "unasserted tax audit
claims" from the unencumbered settlement cash.
About Event Rentals
Event Rentals Inc., the largest event-rental provider in the U.S.,
filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case
No. 14-bk-10282) on Feb. 13, 2014.
Event Rentals, which sought bankruptcy protection with affiliates,
including Classic Midwest, Inc., has 39 locations across 22
markets. The company has the largest offering of event equipment,
value-added event services, and temporary structure assets, and
provide services for over 145,000 events for approximately 55,000
customers annually. The company taps 2,500 employees throughout
the year and has total annual revenues of $235 million.
Assets were listed for $148 million, with debt of $246 million.
The Debtors owe $175 million in outstanding principal under a
senior secured credit agreement; $36 million in outstanding
principal under certain unsecured and subordinated liquidity
notes; $5.5 million in outstanding principal under certain
unsecured and subordinated seller financing relating to business
acquisitions; and trade debt, as of Dec. 26, 2013, totaling $16.6
million.
The Debtors have tapped Jeffrey M. Schlerf, Esq., and John H.
Strock, Esq., at Fox Rothschild LLP as local counsel; John K.
Cunningham, Esq., and Craig H. Averch, Esq., at White & Case LLP
as bankruptcy counsel; Jefferies LLC as financial advisor; and
Kurtzman Carson Consultants LLC as claims and noticing agent.
The Debtors sought bankruptcy protection as they seek a new owner
to take over the business.
Existing lenders led by Ableco Finance LLC, as administrative
agent, have agreed to finance the bankruptcy with a DIP financing
facility of up to $20 million.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven
creditors to serve on the Official Committee of Unsecured
Creditors for the Debtors' Chapter 11 cases.
The Debtors disclosed that funds managed by Apollo Global
Management, LLC submitted the winning offer to acquire
substantially all of the Debtors' business at the April 21, 2014
auction. Apollo acquired the business for $125.2 million in cash.
EVENT RENTALS: Case Caption Changed to "After-Party2 Inc."
----------------------------------------------------------
Following the sale of substantially all of their assets, Event
Rentals Inc., et al., have sought and obtained an order amending
their case caption to In re After-Party2, Inc., (f/k/a Event
Rentals, Inc.) et al.
About Event Rentals
Event Rentals Inc., the largest event-rental provider in the U.S.,
filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case
No. 14-bk-10282) on Feb. 13, 2014.
Event Rentals, which sought bankruptcy protection with affiliates,
including Classic Midwest, Inc., has 39 locations across 22
markets. The company has the largest offering of event equipment,
value-added event services, and temporary structure assets, and
provide services for over 145,000 events for approximately 55,000
customers annually. The company taps 2,500 employees throughout
the year and has total annual revenues of $235 million.
Assets were listed for $148 million, with debt of $246 million.
The Debtors owe $175 million in outstanding principal under a
senior secured credit agreement; $36 million in outstanding
principal under certain unsecured and subordinated liquidity
notes; $5.5 million in outstanding principal under certain
unsecured and subordinated seller financing relating to business
acquisitions; and trade debt, as of Dec. 26, 2013, totaling $16.6
million.
The Debtors have tapped Jeffrey M. Schlerf, Esq., and John H.
Strock, Esq., at Fox Rothschild LLP as local counsel; John K.
Cunningham, Esq., and Craig H. Averch, Esq., at White & Case LLP
as bankruptcy counsel; Jefferies LLC as financial advisor; and
Kurtzman Carson Consultants LLC as claims and noticing agent.
The Debtors sought bankruptcy protection as they seek a new owner
to take over the business.
Existing lenders led by Ableco Finance LLC, as administrative
agent, have agreed to finance the bankruptcy with a DIP financing
facility of up to $20 million.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven
creditors to serve on the Official Committee of Unsecured
Creditors for the Debtors' Chapter 11 cases.
The Debtors disclosed that funds managed by Apollo Global
Management, LLC submitted the winning offer to acquire
substantially all of the Debtors' business at the April 21, 2014
auction. Apollo acquired the business for $125.2 million in cash.
EVENT RENTALS: Debtors, Committee File Liquidating Plan
-------------------------------------------------------
After-Party2, Inc., (f/k/a Event, Rentals, Inc.) et al., and their
official committee of unsecured creditors have proposed a Chapter
11 plan.
The Debtors' assets are largely limited to cash following the sale
of the assets to Apollo Capital Management L.P., for $125,250,000.
The Plan provides that a liquidating trustee will wind down the
affairs of the Debtors and distribute the remaining assets to
holders of allowed claims.
Under the plan, holders of administrative claims aggregating
$9,257,000 and tax claims aggregating $610,000 will be paid in
full. Holders of allowed priority claims, if any, and non-lender
secured claims aggregating $512,046 are unimpaired and will be
paid in full. The prepetition lender claims will be paid in
accordance with the wind-down agreement reached with the Debtors.
Holders of unsecured claims totaling $29,096,673 are slated to
have a 2 percent recovery. Holders of allowed liquidity claims or
allowed opt-out unsecured claims totaling $39,791,000 are slated
to recover 0.01 percent. Holders of equity interests won't
receive anything.
The Bankruptcy Court will convene a hearing on July 16, 2014 at
2:00 p.m. to consider approval of the Disclosure Statement.
Objections are due July 9, 2014 at 4:00 p.m.
A copy of the disclosure statement explaining the terms of the
Plan is available for free at:
http://bankrupt.com/misc/Event_Rentals_Disc_Statement.pdf
About Event Rentals
Event Rentals Inc., the largest event-rental provider in the U.S.,
filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case
No. 14-bk-10282) on Feb. 13, 2014.
Event Rentals, which sought bankruptcy protection with affiliates,
including Classic Midwest, Inc., has 39 locations across 22
markets. The company has the largest offering of event equipment,
value-added event services, and temporary structure assets, and
provide services for over 145,000 events for approximately 55,000
customers annually. The company taps 2,500 employees throughout
the year and has total annual revenues of $235 million.
Assets were listed for $148 million, with debt of $246 million.
The Debtors owe $175 million in outstanding principal under a
senior secured credit agreement; $36 million in outstanding
principal under certain unsecured and subordinated liquidity
notes; $5.5 million in outstanding principal under certain
unsecured and subordinated seller financing relating to business
acquisitions; and trade debt, as of Dec. 26, 2013, totaling $16.6
million.
The Debtors have tapped Jeffrey M. Schlerf, Esq., and John H.
Strock, Esq., at Fox Rothschild LLP as local counsel; John K.
Cunningham, Esq., and Craig H. Averch, Esq., at White & Case LLP
as bankruptcy counsel; Jefferies LLC as financial advisor; and
Kurtzman Carson Consultants LLC as claims and noticing agent.
The Debtors sought bankruptcy protection as they seek a new owner
to take over the business.
Existing lenders led by Ableco Finance LLC, as administrative
agent, have agreed to finance the bankruptcy with a DIP financing
facility of up to $20 million.
Roberta A. DeAngelis, U.S. Trustee for Region 3, appointed seven
creditors to serve on the Official Committee of Unsecured
Creditors for the Debtors' Chapter 11 cases.
The Debtors disclosed that funds managed by Apollo Global
Management, LLC submitted the winning offer to acquire
substantially all of the Debtors' business at the April 21, 2014
auction. Apollo acquired the business for $125.2 million in cash.
FIRST PHILADELPHIA: Has Until July 19 to File Chapter 11 Plan
-------------------------------------------------------------
The Bankruptcy Court, in a fifth order, extended First
Philadelphia Holdings, LLC's exclusive periods to file a Chapter
11 Plan until July 19, 2014, and solicit acceptances for that Plan
until Sept. 18.
First Philadelphia Holdings, LLC, is a Pennsylvania limited
liability company formed on or about March 14, 2005. The Debtor
is headquartered in New Jersey and is in the business of owning
real estate located at 6501 New State Road a/k/a Tacony Street,
Philadelphia, Pennsylvania.
The Company filed a Chapter 11 petition (Bankr. D.N.J. Case No.
12-39767) on Dec. 21, 2012. The Debtor scheduled $15,000,000 in
assets and $10,346,981 in liabilities as of the Chapter 11 filing.
Judge Gloria M. Burns presides over the case.
Maureen P. Steady, Esq., who has an office in Marlton, New Jersey,
serves as the Debtor's bankruptcy counsel. In its schedules, the
Debtor disclosed $15,000,000 in total assets and $10,346,981 in
total liabilities.
No official committee of unsecured creditors, trustee or examiner
has been appointed in the Debtor's Chapter 11 case.
FIRST PHILADELPHIA: PENNVEST Balks at Confirmation of Plan
----------------------------------------------------------
Pennsylvania Infrastructure Investment Authority (PENNVEST) asked
the U.S. Bankruptcy Court for the District of New Jersey to deny
the confirmation of First Philadelphia Holdings, LLC's Chapter 11
Plan.
According to PENNVEST, the Debtor's Amended Disclosure Statement,
as approved, fails to disclose how the Debtor can satisfy the
requirement of the U.S. Bankruptcy Code without any operations or
independent source of funding except the payment by its sole
member George Diemer.
As reported in the Troubled Company Reporter on April 9, 2014, the
Court set a hearing for June 19, 2014 at 10:00 a.m. to consider
confirmation of the Debtor's Plan.
The Debtor proposed a Liquidating Plan, where it sought to
accomplish payments by (i) marketing its real estate for sale,
(ii) making payment to its secured creditors from the proceeds of
the sale, and (iii) making payment to unsecured creditors funded
by Mr. Diemer, who has committed to fund a $20,000 distribution.
The real property in question is located at 6501 New State Road
aka Tacony Street, Philadelphia, Pennsylvania.
Chief Judge Gloria M. Burns approved the Disclosure Statement, as
amended, describing the Plan on March 26, 2014. A copy of the
Disclosure Statement is available for free at:
http://bankrupt.com/misc/FIRSTPHILADELPHIA_AmdDSMar26.pdf
About First Philadelphia Holdings, LLC
First Philadelphia Holdings, LLC, is a Pennsylvania limited
liability company formed on or about March 14, 2005. The Debtor
is headquartered in New Jersey and is in the business of owning
real estate located at 6501 New State Road a/k/a Tacony Street,
Philadelphia, Pennsylvania.
The Company filed a Chapter 11 petition (Bankr. D.N.J. Case No.
12-39767) on Dec. 21, 2012. The Debtor scheduled $15,000,000 in
assets and $10,346,981 in liabilities as of the Chapter 11 filing.
Judge Gloria M. Burns presides over the case.
Maureen P. Steady, Esq., who has an office in Marlton, New Jersey,
serves as the Debtor's bankruptcy counsel. In its schedules, the
Debtor disclosed $15,000,000 in total assets and $10,346,981 in
total liabilities.
No official committee of unsecured creditors, trustee or examiner
has been appointed in the Debtor's Chapter 11 case.
FORESTRY MUTUAL: A.M. Best Raises Issuer Credit Rating From 'bb'
----------------------------------------------------------------
A.M. Best Co. has upgraded the issuer credit rating (ICR) to "bb+"
from "bb" and affirmed the financial strength rating of B (Good)
of Forestry Mutual Insurance Company (FMIC) (Raleigh, NC). The
outlook on both ratings has been revised to positive from stable.
The ICR upgrade reflects the improvement seen in underwriting and
operating results in 2013, as well as positive underwriting cash
flows for the first time since 2007. FMIC has begun to benefit
from geographic diversification since entering markets in
neighboring states, as well as the initiatives taken in recent
years to restructure FMIC's reinsurance program to reduce net loss
ratio volatility. The company has also non-renewed unprofitable
accounts and implemented a zero-tolerance policy for failure to
comply with safety requirements.
The revised outlook reflects A.M. Best's expectations for positive
rating movement should FMIC's results continue to improve. While
the company is well positioned at its current rating level,
negative rating actions could occur if earnings decline or
capitalization levels materially deteriorate.
GENERAL MOTORS: Creditors-JPMorgan Rift Goes to Del. High Court
---------------------------------------------------------------
The Official Committee of Unsecured Creditors in the chapter 11
cases of General Motors commenced an action in 2009 against
JPMorgan Chase Bank, N.A., seeking a determination that, despite
an error, a UCC-3 statement was nonetheless effective to terminate
a Main Term Loan UCC-1, that the security interest was terminated
prior to GM's chapter 11 filing, and that most of the indebtedness
under GM's Term Loan is therefore unsecured.
On cross-motions for summary judgment, the bankruptcy court
concluded that the UCC-3 filing was unauthorized and therefore not
effective to terminate the security interest and granted summary
judgment to JPMorgan. The bankruptcy court then certified the
case for direct appeal to the U.S. Court of Appeals for the Second
Circuit pursuant to 28 U.S.C. Sec. 158(d)(2)
The appeals court noted that, at the heart of this dispute lies a
straightforward question: "Did the UCC-3 filing effectively
terminate the Main Term Loan UCC-1 even though the intent of
everyone involved was to terminate only UCC-1 security interests
related to the Synthetic Lease?" The Second Circuit held that the
answer to that question is governed by the Uniform Commercial
Code, and because General Motors is incorporated under the laws of
the State of Delaware, it is Delaware's version of the UCC that
controls. Accordingly, the Second Circuit certified the question
to the Delaware Supreme Court. Upon receipt of the Delaware
court's response to the certified question, jurisdiction will
automatically be restored to the Second Court to resolve all
remaining issues as needed; the returned appeal will be assigned
to this panel.
According to the Second Circuit, "The Delaware Supreme Court's
clarification as to the sense in which a secured party of record
must authorize a UCC-3 filing will enable us to address the second
question presented by this appeal?whether JPMorgan in fact
provided that authorization. Upon receipt of the Delaware court's
response, we will address alternatively whether the filing of the
UCC-3 record or termination of the Main Term Loan UCC-1 was within
the scope of authority that JPMorgan granted to Mayer Brown."
GM in October 2001 entered into a synthetic lease financing
transaction, by which it obtained approximately $300 million in
financing from a syndicate of financial institutions. The proceeds
were used to acquire and construct facilities on several
properties. Its obligation to repay the Synthetic Lease was
secured by liens on twelve pieces of real estate. The lenders'
security interests in GM's properties were perfected by filing
UCC-1 financing statements in the counties in which the properties
were located and with the Delaware Secretary of State. JPMorgan
served as administrative agent for the Synthetic Lease and was
identified on the UCC-1s as the secured party of record.
Five years later, in November 2006, GM and then-subsidiary Saturn
Corporation entered into a separate term loan facility. The Term
Loan was entirely unrelated to the Synthetic Lease and provided
General Motors with approximately $1.5 billion in financing from a
different syndicate of financial institutions. To secure the loan,
the lenders took security interests in a large number of GM's
assets, including all of GM's equipment and fixtures at 42
facilities throughout the United States. JPMorgan served as
administrative agent and secured party of record for the Term Loan
and caused the filing of 28 UCC-1 financing statements to perfect
the lenders' security interests in the collateral. The Main Term
Loan UCC-1 was filed with the Delaware Secretary of State and bore
file number "6416808 4."
Mayer Brown served as GM's counsel responsible for the Synthetic
Lease.
The case before the Second Circuit is, OFFICIAL COMMITTEE OF
UNSECURED CREDITORS OF MOTORS LIQUIDATION COMPANY, Plaintiff-
Appellant, v. JP MORGAN CHASE BANK, N.A., individually and as
Administrative Agent for various lenders party to the Term Loan
Agreement described herein, Defendant-Appellee, (2nd Cir.), A copy
of the Second Circuit's June 17, 2014 decision is available at
http://is.gd/mdwCMWfrom Leagle.com.
Dickstein Shapiro LLP's Eric B. Fisher, Esq., Barry N. Seidel,
Esq., Katie L. Weinstein, Esq., and Jeffrey Rhodes, Esq.,
represent the Committee.
John M. Callagy, Esq., Nicholas J. Panarella, Esq., Martin A.
Krolewski, Esq., at Kelley Drye & Warren LLP, represent JPMorgan.
About General Motors
With its global headquarters in Detroit, Michigan, General Motors
-- http://www.gm.com/-- is one of the world's largest automakers,
traces its roots back to 1908.
General Motors Co. was formed to acquire the operations of
General Motors Corp. through a sale under 11 U.S.C. Sec. 363
following Old GM's bankruptcy filing. The U.S. government
provided financing. The deal was closed July 10, 2009, and Old GM
changed its name to Motors Liquidation Co.
Old GM -- General Motors Corporation -- 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. The Debtors tapped Weil, Gotshal & Manges LLP
Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as
counsel; and Morgan Stanley, Evercore Partners and the Blackstone
Group LLP as financial advisor. 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 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.
GENESEE & WYOMING: Moody's Hikes Corp. Family Rating to 'B2'
------------------------------------------------------------
Moody's Investors Service upgraded the debt ratings of Genesee &
Wyoming Inc., including the Corporate Family Rating to Ba2 from
Ba3. In connection with the upgrade, Moody's has assigned a Ba2
rating to the amended senior secured credit facility, comprising
of a $625 million revolving credit facility, a USD$1,520 million
term loan and a AUD$216.8 million term loan of Genesee & Wyoming
Australia Pty Ltd. Moody's also affirmed the SGL-2 Speculative
Grade Liquidity rating. The ratings outlook is stable.
Ratings Rationale
The upgrade to a Ba2 CFR reflects Moody's expectation of steady
operating profit and strong cash flow, and that Genesee & Wyoming
will continue to grow its business through moderate-sized debt
funded acquisitions, preserving a financial policy that aims to
reduce leverage post acquisition. Moody's anticipates Genesee &
Wyoming will maintain its operating margin in the high 20% range,
much improved from the 22% recorded in 2010 and prior to the
RailAmerica acquisition. Genesee & Wyoming's expected
profitability compares favorably to the margins of around 30% of
certain Class I railroads, given that the company is predominantly
a short line and regional rail operator. RailAmerica, which was
Genesee & Wyoming's largest investment, has largely been
integrated. As a result, Moody's anticipates debt to EBITDA to
remain in the mid-3x range, including the impact from the $215
million acquisition of the west end of the Dakota, Minnesota and
Eastern ("DM&E") line. This would be a significant reduction from
the nearly 5x pro-forma for the $2.0 billion acquisition of
RailAmerica in 2012. Some increase in financial leverage may occur
to fund acquisitions, but Moody's anticipates steady deleveraging
afterwards.
Moody's considers Genesee & Wyoming's liquidity to be good, as
reflected in the SGL-2 Speculative Grade Liquidity rating.
Although the company typically maintains a modest cash balance,
cash flow from operations is ample to fund both maintenance and
growth capital expenditures. Furthermore, the company has access
to a recently upsized revolving credit facility of $625 million,
which was substantially undrawn upon closing and matures in 2019.
The Ba2 rating for the senior secured credit facilities is in line
with the company's Ba2 CFR, as the debt structure in Moody's Loss
Given Default ("LGD") analysis consists almost entirely of the
$625 million revolving credit facility, the $1,520 USD term loan
and the A$216.8 million AUD term loan.
The stable ratings outlook is predicated on Moody's expectation of
moderate revenue growth of about 3% to 5% and operating margins
that are sustained at the level achieved in 2013, as well as a
successful operation of the DM&E assets. Moody's also expects
Genesee & Wyoming to generate free cash flow of at least $150
million annually.
The ratings could be lowered if demand for rail freight
unexpectedly weakens, or if there is a meaningful deterioration in
pricing that sustainably affects profit negatively. Operating
margins that fall materially below 25% could hinder the company's
ability to reduce debt through discretionary prepayments. A
deterioration in credit metrics such as debt to EBITDA of 4.0
times or higher or EBIT to Interest of less than 3.5 times for a
prolonged period of time could also warrant a downgrade. Further,
a change in the company's shareholder distribution policy is
likely to impact ratings negatively.
Moody's does not foresee upward rating pressure in the near term.
However, the ratings could be upgraded following a structurally
lower level of financial leverage, including debt to EBITDA
sustainably at or below the mid 2x level. In addition, a positive
rating action could occur following a meaningful increase in scale
and further improvements in operating margins.
Upgrades:
Issuer: Genesee & Wyoming Inc.
Corporate Family Rating, Upgraded to Ba2 from Ba3
Probability of Default Rating, Upgraded to Ba2-PD from Ba3-PD
Assignments:
Issuer: Genesee & Wyoming Inc.
Senior Secured Bank Credit Facility, Assigned Ba2, LGD3, 43 %
Issuer: Genesee & Wyoming Australia Pty Ltd
Senior Secured Bank Credit Facility, Assigned Ba2, LGD3, 43 %
Outlook Actions:
Issuer: Genesee & Wyoming Inc.
Outlook, Remains Stable
Issuer: Genesee & Wyoming Australia Pty Ltd
Outlook, Remains Stable
Affirmations:
Issuer: Genesee & Wyoming Inc.
Speculative Grade Liquidity Rating, Affirmed SGL-2
Withdrawals:
Issuer: Genesee & Wyoming Inc.
Senior Secured Bank Credit Facility due 2017, WR
Issuer: Genesee & Wyoming Australia Pty Ltd
Senior Secured Bank Credit Facility due 2017, WR
The principal methodology used in this rating was the Global
Surface Transportation and Logistics Companies published in April
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.
Genesee & Wyoming Inc. operates short line and regional freight
railroads and provides railcar switching services in the U.S.,
Australia, Canada, and Europe.
HARRIS LAND: Midwest Wins Conditional Stay Relief
-------------------------------------------------
The Bankruptcy Court entered a conditional order granting (i)
creditor Midwest Independent Bank relief from the automatic stay;
and (ii) the stipulation for use of cash collateral and for
adequate protection of Midwest Independent Bank.
The Court ordered that MIB's motion is granted with the condition
that within 180 days of the May 16 order, the Debtor will either
(i) enter into a contract for the sale of the real estate which is
the subject of the motion; or (ii) obtain refinancing to pay all
loan obligations, including principal, interest, late charges,
attorney's fees, and court costs, owed to MIB. Any contract or
loan commitment for refinancing will close by Nov. 30, 2014, and
will further provide for full payment of all amounts the Debtor
owes MIB.
The closing of either the contract or the refinancing loan must
close by Nov. 30, 2014, for the stay to remain in effect.
Additionally, the Debtor will make monthly adequate protection
payments to MIB in the amount of $11,454, which is the prepetition
and pre-default principal and interest payments Debtor tendered to
MIB on a monthly basis, starting immediately and due on the 30th
day of each month hereafter until Nov. 30, or such other date as
the parties may agree by stipulation and appropriate motion filed
with the Court.
Further, the Debtor will maintain proper insurance for all
collateral securing the debt obligations Debtor owes to MIB, and
that Debtor will pay all real estate and other taxes due in
compliance with the loan documents executed by and between MIB and
Debtor.
Harris sought authorization to use the rent proceeds from the real
property, which are encumbered by the mortgages and assignment of
rents of the Debtor's secured creditors. Harris argued it needs
to use the rent proceeds to pay ordinary and necessary
postpetition operating expenses. The Debtor also seeks to use
$12,500 of cash collateral as a retainer for co-counsel, Neil
Sader.
As reported in the Troubled Company Reporter on May 20, 2014,
First State Bank of Saint Robert, a secured creditor and party-in-
interest, withdrew its objection to the Debtor's motion to use
cash collateral. According to the Bank, its counsel and the
Debtor's counsel have discussed adequate protection payments, and
based upon the representation of the Debtor's counsel, the Debtor
will resume adequate protection payments in the amounts set forth
in the promissory notes.
The Bank, in its objection, stated that it denies the right of
Debtor to use the funds, as proposed, if the Bank is not paid its
regular contractual payments. The Bank asserts that it holds two
claims in the bankruptcy estate. The rentals are proceeds of the
collateral pledged to the Bank and it is entitled to its
contractual payment as adequate protection in the amount of $1,322
for Loan No. 9160050 and $4,015 for Loan No. 9160052 plus proof of
insurance.
Meanwhile, Midwest Independent Bank, another creditor, objected to
any use by the Debtor of MIB's cash collateral. According to MIB,
the Debtor has sought Court permission to spend MIB's cash
collateral; however the Debtor has not and cannot show the
pendency of immediate or irreparable harm, no provision for
appropriate and adequate protection to MIB, and most importantly,
no legal right, title, and interest in and to any of the rents
from the Properties subject to MIB's liens.
MIB noted that the Debtor is in default under the terms of the
loan documents and obligations owed to MIB, and all of the
obligations are due and payable due to the maturity of the Note.
About Harris Land Development, LLC
Harris Land Development, LLC, sought Chapter 11 protection (Bankr.
W.D. Mo. Case No. 14-60554) in Springfield, Missouri, on April 28,
2014, without stating a reason. The Debtor disclosed $16,534,000
in assets and $11,107,302 in liabilities as of the Chapter 11
filing. This is Harris Land's second trip to bankruptcy. The
first bankruptcy was in September 2010 in In Re Harris Land
Development, LLC, Case No. 10-62322 (Bankr. W.D. Mo.).
HARRIS LAND: Sader Law Firm Approved as Bankruptcy Co-Counsel
-------------------------------------------------------------
The Bankruptcy Court authorized Harris Land Development, LLC, to
employ Neil S. Sader and Christian D. Nafziger of The Sader Law
Firm as co-counsel.
The Debtor, in an amended application, said that the hourly rates
of the firm's personnel are:
Mr. Sader $315
Mr. Nafziger $215
Paralegal $105
The firm can be reached at:
Neil S. Sader, Esq.
Christian D. Nafziger, Esq.
THE SADER LAW FIRM
2345 Grand Boulevard, Suite 1925
Kansas City, MO 64108
Tel: (816) 561-1818
(816) 595-1800
Fax: (816) 561-0818
E-mail: nsader@saderlawfirm.com
As reported in the Troubled Company Reporter on May 28, 2014, the
Debtor required Sader Law to:
(a) advise the Debtor with respect to its rights and
obligations as Debtor-In-Possession and regarding other
matters of bankruptcy law;
(b) prepare and file any petition, schedules, motions,
statement of affairs, plan of reorganization, or other
pleadings and documents that may be required in this
proceeding;
(c) represent the Debtor at the meeting of creditors, plan of
reorganization, disclosure statement, confirmation and
related hearings, and any adjourned hearings thereof;
(d) represent the Debtor in adversary proceedings and other
contested bankruptcy matters; and
(e) represent the Debtor in the above matters, and any other
matters that may arise in connection with the Debtor's
reorganization proceeding and its business operations.
Sader Law will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Sader Law requested a $12,500 retainer to be paid by officers of
the Debtor directly and not with DIP funds.
Neil S. Sader, managing member of Sader 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.
About Harris Land Development, LLC
Harris Land Development, LLC, sought Chapter 11 protection (Bankr.
W.D. Mo. Case No. 14-60554) in Springfield, Missouri, on April 28,
2014, without stating a reason. The Debtor disclosed $16,534,000
in assets and $11,107,302 in liabilities as of the Chapter 11
filing. This is Harris Land's second trip to bankruptcy. The
first bankruptcy was in September 2010 in In Re Harris Land
Development, LLC, Case No. 10-62322 (Bankr. W.D. Mo.).
HERTZ CORP: Delayed Finc'l Statement No Impact on Moody's B1 CFR
----------------------------------------------------------------
Moody's Investors Service said that The Hertz Corporation's
(Hertz, B1 stable) failure to file its first-quarter 2014
financial statements is a credit-negative event that has resulted
in a restriction on its ability to access certain ABS fleet
funding programs. However, the restricted ABS programs are only a
portion of Hertz's total vehicle funding resources, and Moody's
believe that the company maintains adequate liquidity.
Consequently, Hertz's ratings (including B1 Corporate Family
Rating, Ba1 secured debt rating, B2 unsecured debt rating and SGL-
3 speculative grade liquidity rating) are currently unaffected,
and the rating outlook is stable. The rating agency stressed,
however, that unless Hertz is able to resolve this reporting
problem during the next several months there could be seriously
negative consequences for Hertz's liquidity profile and credit
ratings.
ILLUMINATION IQ: Files Bankr. in Toronto; Meeting on June 26
------------------------------------------------------------
I.T.I. Inc., 1696366 Ontario Limited, and Illumination IQ Inc.,
filed for bankruptcy in Ontario, Canada, on June 9, 2014. The
cases are being administered on a consolidated basis. The first
meeting of creditors will be held June 26 at 9:00 a.m. at the
office of the trustee, MNP Ltd., at 300-111 Richmond St. W., in
Toronto, Ontario.
The Trustee may be reached at:
MNP Ltd.
Trustee in Bankruptcy
300-111 Richmond St. W.
Toronto, ON M5H 2G4
Tel: 416-596-1711
JAMES RIVER: S&P Withdraws 'D' CCR Over Chapter 11 Filing
---------------------------------------------------------
Standard & Poor's Ratings Services revised its recovery ratings on
James River Coal Co.'s 7.875% senior notes and 10% convertible
notes to '5' from '4', indicating S&P's expectation for modest (at
the lower end of the 10% to 30% range) recovery. There is no
change to the '6' recovery ratings on the company's 4.5%
convertible notes and 3.125% convertible notes, which lack
subsidiary guarantees, indicating S&P's expectation for negligible
(0% to 10%) recovery. S&P subsequently withdrew all ratings,
including the 'D' corporate credit rating, on the company.
S&P lowered the corporate credit rating on James River to 'D' from
'CC' on April 9, 2014, following a missed interest payment and the
Chapter 11 filing.
S&P revised recovery assessment primarily reflects the following
considerations:
-- Potential for priority claims relating to James River's DIP
financing, which could reduce the value available to support
bondholder recoveries.
-- Need to renew or replace, and potentially maintain, cash
collateral for James River's standby letters of credit,
which expire in the first half of 2015. This could affect
James River's ability to attract exit capital for a
reorganization or to sell mines as going concerns and could
reduce the value available to support bondholder recoveries,
especially if a plan of reorganization sponsor or mine
buyers have to contend with any cash collateral
requirements.
-- Risk that James River's thermal coal assets in Central
Appalachia, which represent a sizable portion of its
reserves, will generate only nominal recovery value.
-- Downside risk of outright asset liquidation. If this were
to occur, S&P thinks bondholder recoveries would be less
than 10%.
JAMAT LLC: Mattress Source Chain Files Ch.11, to Close Outlets
--------------------------------------------------------------
Imperial, Missouri-based Jamat, LLC, which does business as
Mattress Source, filed for Chapter 11 bankruptcy protection
(Bankr. E.D. Mo. Case No. 14-44811) on June 13, 2014, in St.
Louis. Judge Barry S. Schermer presides over the case. Spencer
P. Desai, Esq., at Desai Eggman Mason LLC, serves as the Debtor's
counsel. In its petition, Jamat estimated $1 million to $10
million in both assets and liabilities. The petition was signed
by Barry Seidel, member.
Lisa Brown, writing for the St. Louis Post Dispatch, reported that
Mr. Desai said Mattress Source will continue to operate but will
close some unprofitable stores. Mattress Source has 13 local
stores in Missouri and Illinois. The store locations that will
close, about five, have not yet been determined, the report said.
The report added that Barry Seidel, who owns the business with his
wife, Valerie, said the market has become more competitive over
the past six years since he opened the first Mattress Source store
in Arnold. Mr. Seidel said the chain will retain its 40
employees, and all warranties on mattresses will be honored. The
couple's other business, Noctova, which manufactures mattresses,
pillows and mattress protectors, also will remain operational, Mr.
Seidel said.
JAZZ ACQUISITION: S&P Assigns 'B' CCR; Outlook Stable
-----------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B'
corporate credit rating to Jazz Acquisition Inc. The outlook is
stable.
At the same time, S&P assigned its 'B' issue rating and '3'
recovery rating to the company's proposed $385 million first-lien
credit facility, which consists of a $65 million revolver due 2019
and a $320 million term loan due 2021. The '3' recovery rating
indicates S&P's expectation for meaningful recovery (50%-70%) in
the event of a payment default.
S&P also assigned its 'CCC+' issue rating and '6' recovery rating
to the company's proposed $155 million second-lien term loan due
in 2022. The '6' recovery rating indicates S&P's expectation for
negligible recovery (0%-10%) in the event of a payment default.
"The rating on Jazz reflects our expectations that leverage will
be very high following the proposed leveraged buyout of Wencor
Group LLC, with modest improvement likely over the next 12
months," said Standard & Poor's credit analyst Tatiana Kleiman.
"We expect revenues and earnings to increase modestly over the
next year due to a combination of strong market conditions as well
as contributions from acquisitions." S&P assess the company's
business risk profile as "fair," reflecting its leading position
in niche markets for commercial aerospace aftermarket parts, its
solid operating profitability, its limited end-market diversity,
and its narrow scope of operations, as well as some barriers to
entry. S&P assess Jazz's financial risk profile as "highly
leveraged," based on the company's high debt leverage, very
aggressive financial policy, and "adequate" liquidity.
Warburg Pincus LLC plans to purchase Wencor Group from its current
private equity owners using a combination of debt and sponsor
equity (the leveraged buyout of Wencor Group includes the creation
of its parent entity, Jazz) The transaction will be financed with
$419 million of common equity from Warburg and new debt. S&P
believes that the transaction will result in very weak credit
ratios, with pro forma total adjusted debt to EBITDA of 8x-9x and
funds from operations (FFO) to total adjusted debt of 4.5%-6.5% in
2014. S&P expects gradual improvement in Jazz's credit ratios
over the next year as the company benefits from earnings growth
and the contribution from its previous acquisitions, with debt to
EBITDA declining to 7.5x-8.5x and FFO to debt remaining in the
4.5%-6.5% range in 2015. Jazz's private equity ownership
currently limits its financial risk profile assessment to "highly
leveraged," unless its leverage declines to below 5x and the
company's owners demonstrate a commitment to keep it at that level
on an ongoing basis.
The outlook is stable. S&P expects Jazz's revenue and earnings to
increase over the next 12 months as a result of ongoing strength
in the commercial aerospace market, including increasing global
flight hours and expanding fleet size, airlines' continued focus
on low cost solutions, and contributions from acquisitions.
Higher earnings and some debt reduction from excess free cash flow
should result in gradually improving credit ratios over the next
12-18 months.
S&P could lower the rating if commercial aftermarket demand
weakens or if debt-financed acquisitions or dividends result in
debt to EBITDA above 9x and FFO to debt below 4%.
The company's private equity ownership and the potential for a
debt-financed acquisition, dividend, or other transaction that
could significantly increase leverage reduce the possibility of an
upgrade under the current ownership structure.
KINDRED HEALTHCARE: Equity Offering No Impact on Moody's B1 CFR
----------------------------------------------------------------
Moody's Investors Service commented that Kindred Healthcare Inc.'s
announcement that the company would issue equity in order to fund
a portion of its contemplated acquisition of the equity of Gentiva
Health Services, Inc. (B3 negative) is a positive development as
it will limit the potential for deterioration of its credit
metrics. However Moody's stated that it still views the
acquisition -- if ultimately consummated -- as a credit negative.
Risks remain around the size of the acquisition, the integration
of Gentiva's operations, the resulting increase in exposure to
Medicare reimbursement and the ultimate price needed to complete
the transaction. Kindred's announced equity offering coincided
with a notice that the company would tender for all of the
outstanding shares of Gentiva for $14.50 a share -- a $0.50 per
share increase over the previously announced offer in May 2014.
Therefore, Kindred's ratings, including the B1 Corporate Family
Rating and B1-PD Probability of Default Rating, remain unchanged.
The negative rating outlook also remains unchanged.
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.
Kindred Healthcare, Inc., through its subsidiaries, operates long
term acute care hospitals, inpatient rehabilitation facilities,
skilled nursing facilities, assisted living facilities, a contract
rehabilitation services business and a home health and hospice
business across the US. For the twelve months ended
March 31, 2014 the company recognized revenue of approximately
$4.9 billion after considering the provision for doubtful
accounts.
KRIEG FAMILY: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Krieg Family Limited Partnership
dba Days Inn Safford
P.O. BoxM
Safford, AZ 85548
Case No.: 14-09305
Chapter 11 Petition Date: June 17, 2014
Court: United States Bankruptcy Court
District of Arizona (Tucson)
Debtor's Counsel: Sally M Darcy, Esq.
MCEVOY, DANIELS & DARCY P.C.
Camp Lowell Corporate Center
4560 East Camp Lowell Drive
Tucson, AZ 85712
Tel: 520 326-0133
Fax: 520 326-5938
Email: ccarter@mddlaw.com
darcysm@aol.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Mary Lou Krieg, general partner.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/azb14-09305.pdf
LA QUINTA HOLDINGS: S&P Assigns 'B+' CCR; Outlook Stable
--------------------------------------------------------
Standard & Poor's Ratings Services assigned Irving, Texas-based
hotel company La Quinta Holdings Inc. a 'B+' corporate credit
rating. The rating outlook is stable.
At the same time, S&P assigned the company's $2.35 billion senior
secured credit facility (consisting of a $250 million revolver due
2019 and $2.1 billion first-lien term loan due 2021) its 'BB-'
issue-level rating (one notch above the corporate credit rating),
with a recovery rating of '2', indicating S&P's expectation for
substantial (70% to 90%) recovery for lenders in the event of a
payment default. S&P expects the revolving credit facility will
be undrawn at close.
La Quinta used the proceeds from this debt issuance, in addition
to proceeds from the April 9, 2014, IPO, to repay existing debt
balances, and for transaction fees and expenses.
The 'B+' corporate credit rating reflects S&P's assessment of La
Quinta's business risk profile as "fair" and S&P's assessment of
the company's financial risk profile as "highly leveraged,"
according to its criteria.
S&P's assessment of La Quinta's business risk profile as fair
reflects the company's single brand portfolio that targets the
mid- to upper-midscale lodging segment, an area of the lodging
market with low barriers to entry, and price-sensitive consumers.
S&P also views the single brand as a potential competitive
weakness in attracting third-party capital investment to grow its
system of franchised rooms. These risks are partially offset by
La Quinta's good operating efficiency, focus on further growth
through its franchised portfolio, which S&P views to be less
volatile in a downturn, and good brand recognition.
S&P's assessment of La Quinta financial risk profile as highly
leveraged reflects its financial policy assessment of the
company's financial sponsor, Blackstone, which continues to own an
approximately 70% stake of La Quinta following the IPO. This
majority ownership means Blackstone controls La Quinta's financial
policy in the intermediate term. In addition, S&P expects total
lease-adjusted net debt to EBITDA, incorporating its base-case
performance assumptions, in the mid-5x area in 2014 and high-4x
area in 2015.
LANGUAGE LINE: Moody's Lowers Corporate Family Rating to 'B3'
-------------------------------------------------------------
Moody's Investors Service downgraded Language Line Holdings, LLC's
Corporate Family Rating (CFR) to B3 from B2, its Probability of
Default Rating to B3-PD from B2-PD, and the ratings for the
company's first and second lien credit facilities to B2 and Caa2,
respectively. The ratings outlook was changed to negative from
stable. The ratings action reflects the company's weak liquidity
as a result of its limited operating cushion under the financial
covenants and the increase in its probability of default.
Ratings Rationale
The downgrade of Language Line's ratings reflects the company's
weak liquidity and management's aggressive financial policy in
managing tight financial covenants. Language Line's liquidity is
constrained as a result of its modest operating cushion under the
leverage covenant in its senior credit facilities. Moody's expects
Language Line to generate over $40 million in free cash flow in
2014 and nearly all of that will be allocated to reduce debt.
Despite the anticipated debt reduction, in addition to the
repayment of about $45 million of debt in 2013, Moody's believes
that the company's prospective ability to comply with debt
covenants is uncertain because of the additional step-downs in the
covenant in 3Q '14 and 1Q '15, and Moody's expectation of flat-to-
modestly declining EBITDA. Language Line canceled its proposed
recapitalization plan in May 2014, but it will need to access the
capital markets given the covenant tightness and upcoming debt
maturities in 2015 and 2016.
The B3 CFR incorporates Moody's expectation that Language line
will address its weak liquidity and approaching debt maturities
over the next 24 months in a timely manner. The company's revenues
should grow by at least the low single digit percentages and its
free cash flow should be in the high single digit percentages of
total debt over the next 12 to 24 months. Moody's expects Language
Line to maintain total debt to EBITDA (Moody's adjusted) of below
6.0x.
Moody's could stabilize Language Line's ratings outlook if its
liquidity improves, including availability of funds under the
revolving credit facility and headroom under covenants. Moody's
could upgrade Language Line's ratings if the company successfully
addresses its covenant and refinancing concerns, demonstrates
sustained growth in revenues and earnings, and if Moody's believes
that the company could maintain total debt to EBITDA (Moody's
adjusted) below 6x times and free cash flow to debt in the high
single digit percentages.
Language Line's ratings could be downgraded if revenues or
operating cash flow decline or liquidity continues to deteriorate.
Moody's downgraded the following ratings:
Downgrades:
Issuer: Language Line Holdings, LLC
Corporate Family Rating, Downgraded to B3 from B2
Probability of Default Rating, Downgraded to B3-PD from B2-PD
Issuer: Language Line, LLC
Senior Secured Bank Credit Facility Jun 20, 2016, Downgraded to
B2 (LGD3, 36%) from B1
Senior Secured Bank Credit Facility Dec 20, 2015, Downgraded to
B2 (LGD3, 36%) from B1
Senior Secured Bank Credit Facility Dec 20, 2016, Downgraded to
Caa2 (LGD5, 89%) from Caa1
Outlook Actions:
Issuer: Language Line Holdings, LLC
Outlook, Changed To Negative From Stable
Issuer: Language Line, LLC
Outlook, Changed To Negative From Stable
California-based Language Line primarily provides over-the-phone
interpretation, onsite interpretation and other language services.
The company is controlled by ABRY Partners, LLC and reported
revenues of $326 million for the twelve months ended March 2014.
The principal methodology used in this rating was 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.
LEVEL 3: Moody's Places 'B3' CFR on Review for Upgrade
------------------------------------------------------
Moody's Investors Service will review Level 3 Communications
Inc.'s ratings for upgrade following the company's announcement
that it will acquire tw telecom (TWT) in a $7.5 billion stock-and-
cash transaction that was announced on 16 June 2014. Pending
normal regulatory approvals, the transaction is expected to close
in the fourth quarter of 2014. Level 3 has a B3 corporate family
rating (CFR) and a B3-PD probability of default rating (PDR).
Individual instruments are rated Ba3, B3 and Caa2 (see listing,
below). Level 3's liquidity rating has been changed to SGL-2 (good
liquidity) from SGL-1 (very good liquidity).
The following summarizes the rating actions and Level 3's ratings:
Outlook Actions:
Issuer: Level 3 Communications, Inc.
Outlook, Changed To Rating Under Review From Stable
Issuer: Level 3 Financing, Inc.
Outlook, Changed To Rating Under Review From Stable
On Review for Possible Upgrade:
Issuer: Level 3 Communications, Inc.
Corporate Family Rating, Placed on Review for Possible Upgrade,
currently B3
Probability of Default Rating, Placed on Review for Possible
Upgrade, currently B3-PD
Senior Unsecured Notes, Placed on Review for Possible Upgrade,
currently Caa2 (LGD6, 92%)
Speculative Grade Liquidity Rating changed to SGL-2 (good
liquidity) from SGL-1 (very good liquidity)
Issuer: Level 3 Financing, Inc.
Senior Secured Bank Credit Facility, Placed on Review for
Possible Upgrade, currently Ba3 (LGD2, 10%)
Senior Unsecured Regular Bond/Debenture, Placed on Review for
Possible Upgrade, currently B3 (LGD4, 58%)
Ratings Rationale
Since Moody's expects improved free cash generation and reduced
leverage, Level 3's ratings are on review for upgrade following
the company's announcement that it will acquire TWT. Pending
normal regulatory approvals, the transaction is expected to close
in the fourth quarter of 2014 and Moody's review, which will focus
on the magnitude, timing, costs and risks of achieving synergies,
as well as liquidity planning and the combined entity's credit
profile once steady state is achieved, is anticipated to conclude
at approximately the same time. Depending on the amount of debt
that remains at the TWT entities and its structural seniority
relative to Level 3'd debt, certain instrument ratings may remain
unchanged even if Level 3's CFR and PDR are upgraded. In addition,
since existing instrument ratings are affected by an over-ride of
Moody's LGD model that results in a large number of debt
instruments being rated B3 despite an indicated Caa1 outcome, the
review will also re-address the continued applicability of the
over-ride. In the interim, all instrument ratings remain
unchanged.
Corporate Profile - Level 3 Communications Inc.
Headquartered in Broomfield, Colorado, Level 3 Communications,
Inc. (Level 3) is a publicly traded international communications
company with one of the world's largest long-haul communications
and optical Internet backbones. Level 3's annual revenue is
approximately $6.4 billion and annual (Moody's adjusted) EBITDA is
$1.9 billion. Approximately 73% of revenue is generated in North
America, 15% in Europe, and 12% in Latin America.
Corporate Profile - tw telecom
With head offices in Littleton, Colorado, tw telecom inc. is a
competitive communications provider. The company provides managed
network services, Internet access, virtual private network, voice
and data services, and network security to enterprise
organizations and communications services companies throughout the
US. TWTC's footprint extends to 75 of the top 100 markets in the
US.
The principal methodology used in this rating was the Global
Communications Infrastructure Rating Methodology published in June
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.
LILY GROUP: VHGI Creditors Seek Case Consolidation, Parties React
-----------------------------------------------------------------
Four individual creditors of the involuntary Chapter 11 Debtor
VHGI Holdings, Inc., under Case No. 14-80005-FJO-11, filed, in
April 2014, a motion to substantively consolidate the VHGI cases
with the bankruptcy case of Lily Group, Inc.
VHGI is the sole shareholder of VHGI Coal, Inc., who in turn is
the sole shareholder of Lily Group.
The VHGI Creditors allegedly lent money to VHGI. In exchange, the
Creditors said they were given a senior promissory note that
granted senior rights to payment from VHGI, shares of stock of
VHGI, and even granted at least two of the Creditors a security
interest in all of VHGI's assets.
The VHGI Creditors asserted that because some or all of the VHGI
Borrowed Funds were used in Lily Group's operations (and even
though they knew the VHGI Borrowed Funds were to be lent by VHGI
to Lily Group), the Bankruptcy Court presiding over Lily Group's
case should enter an order declaring that VHGI and Lily Group are,
in essence, one company and that, therefore, VHGI's bankruptcy
case and Lily Group's proceeding should be substantively
consolidated.
Parties Reply
Lily Group; LC Energy Holdings LLC; and the Official Committee of
Unsecured Creditors filed with the Court separate objections on
the Motion to Consolidate.
Lily Group says the VHGI Creditors are investors who invested
funds, albeit some allocation of such investments characterized in
the form of loans, to VHGI in exchange for a share in ownership of
VHGI and for the purpose of ultimately sharing in the profits
realized from LGI's operations that would ideally swim upstream.
Lily Group maintains that the VHGI Creditors are not of the same
ilk as its unpaid employees, taxing authorities, vendors and trade
creditors. "To dilute any recovery of such legitimate creditors
of Lily Group by claims of equity investors of Lily Group's grand-
parent company because their investment didn't prove to be
profitable as anticipated flies in the face of the purpose and
intent of the Bankruptcy Code," Courtney E. Chilcote, Esq., of
Tucker Hester Baker & Krebs LLC, counsel to Lily Group, argues.
The Creditors Committee, for its part, asserts that granting the
Motion will only benefit the VHGI Creditors. It would only dilute
any payment the Lily Group creditors may receive and could wipe
out any recovery all together, the Committee says. The Committee
adds that the facts and circumstances pled in the Motion are not
sufficient to maintain a colorable claim for substantive
consolidation.
Secured creditor LC Energy complains that the Motion to
Consolidate is filled with general misstatements and unsupported
conclusions.
All of the Objecting Parties seeks denial of the Motion to
Consolidate.
The Creditors Committee is represented by Terry E. Hall, Esq., of
Faegre Baker Daniels LLP, of 300 N. Meridian Street, Suite 2700,
Indianapolis, IN 46204.
LC Energy Holdings LLC is represented by:
KROGER, GARDIS & REGAS, LLP
Jay P. Kennedy, Esq.
111 Monument Circle, Suite 900
Indianapolis, IN 4204-5125
(317) 692-9000
About Lily Group Inc.
Lily Group Inc., the developer of an open-pit coal mine in Green
County, Indiana, filed a petition for Chapter 11 reorganization
(Bankr. S.D. Ind. Case No. 13-81073) on Sept. 23, 2013, in Terre
Haute, estimating assets and debt both exceeding $10 million.
Jefferson & Brewer LLC has been designated as the Debtor's chief
restructing officer.
The Debtor is represented by Courtney Elaine Chilcote, Esq., and
David R. Krebs, Esq., at Tucker, Hester, Baker & Krebs, LLC, in
Indianapolis, Indiana.
U.S. Trustee Nancy J. Gargula appointed four members to the
official committee of unsecured creditors in the Chapter 11 cases
of Lily Group Inc. Faegre Baker Daniels LLP represents the
Committee.
LM U.S. MEMBER: Moody's Rates $220MM 1st Lien Add-on Debt 'B2'
--------------------------------------------------------------
Moody's Investors Service has assigned a B2 rating to the proposed
$220 million first lien add-on term loan and a Caa2 rating to the
proposed $106 million second lien add-on term loan of LM U.S.
Member LLC ("Landmark Aviation" and includes co-borrower, LM U.S.
Corp Acquisition Inc.). Concurrently, Moody's affirmed all ratings
of Landmark Aviation, including the B3 corporate family rating and
the B3-PD probability of default rating. The rating outlook
remains stable.
Proceeds from the proposed add-on term loans will be used to fund
Landmark Aviation's planned acquisition of Ross Aviation (Ross
Aviation, unrated), an operator of a network of 20 fixed base
operations (FBOs) throughout the U.S.
The following ratings have been assigned:
B2 (LGD3, 35%) to the $220 million first lien add-on term loan
due October 2019; and
Caa2 (LGD5, 86%) to the $106 million second lien add-on term
loan due October 2020.
The following ratings have been affirmed:
Corporate family rating at B3;
Probability of default rating at B3-PD;
B2 (LGD 3, 35% from LGD3, 33%) rating on the upsized $110
million first lien revolver due October 2018;
B2 (LGD 3, 35% from LGD3, 33%) on the $366 million first lien
term loan due October 2019;
B2 (LGD 3, 35% from LGD3, 33%) on the $25 million first lien
term loan due October 2019; and
Caa2 (LGD 5, 86% from LGD5, 82%) on the $160 million second
lien term loan due October 2020.
Ratings Rationale
The affirmation of the B3 corporate family rating incorporates
Moody's expectation that acquisitions are a part of Landmark
Aviation's growth strategy, and to date the company has acquired
FBOs at a rapid pace. Ross Aviation is the fifth acquisition for
Landmark Aviation this year and significantly larger than previous
acquisitions. Following the transaction, Landmark's funded debt
will have increased by about $330 million (or approximately 50%)
from year end 2013. Moody's views this nearly fully-debt funded
acquisition as quite aggressive given the company's already high
leverage for its current rating category. The affirmation is also
based on Moody's expectation that the company will be able to
successfully integrate the Ross acquisition with the related
synergies and cost savings to effect a fairly rapid deleveraging.
Moody's believes that the acquisition is a good strategic fit for
the company, as proforma, Landmark Aviation will have
approximately the same number of FBO locations in the US as the
currently two largest FBO operators in the US, Signature Flight
Support (Signature, unrated) and Atlantic Aviation FBO, Inc.
(Atlantic Aviation, Ba3 Stable). Further, Moody's believes the
addition of these locations, particularly on the West Coast, in
the South West, and in Hawaii will provide network synergies that
should enhance Landmark Aviation's value proposition to existing
and new customers, and allow Landmark Aviation to more effectively
compete for market share with rivals Signature and Atlantic
Aviation.
The B3 corporate family rating reflects Landmark Aviation's high
financial leverage (proforma run-rate debt to EBITDA in excess of
7.5x, Moody's-adjusted basis) and Moody's expectation that the
company's on-going growth ambitions and capital projects may
continue to raise debt levels and limit the amount of free cash
flow available for debt reduction. While jet-based general
aviation activity levels should continue to improve over the next
few years, the maintenance of high financial leverage makes the
prospect of healthier credit statistics rather dependent on the
magnitude of future growth. Moody's anticipates that while Ross
Aviation and the other recent acquisitions will likely improve the
company's recently low operating profit, they will not be able to
fully offset the added debt over the near-term. Accordingly, the
B3 CFR acknowledges the need for rather strong ongoing earnings
growth to temper the currently high leverage burden and to
establish a better earnings track record given the continuing
sensitivity of business travel to macroeconomic factors and tax
policy.
The stable outlook is supported by the expectation that the
company is able to successfully integrate recent acquisitions and
de-lever towards the 7x level. Expected moderate revenue growth
and the maintenance of an adequate liquidity profile further
support the outlook. In addition, Landmark's policy of regularly
re-setting its fuel prices with market movement and holding only a
small supply of fuel inventory limits risk of volatile earnings
from spot oil price moves.
A ratings upgrade is unlikely in the near-term and would depend on
the company's ability to reduce debt to EBITDA to the 5x range
with free cash flow to debt in the mid single digit range. Given
the significant leveraging nature of this transaction, additional
leverage or a weakening of operating performance or liquidity
could result in a change in the outlook to negative or a possible
downgrade. Downward rating pressure would follow debt to EBITDA
sustained above 7.5x beyond 2014 following integration of the
recent FBO acquisitions or liquidity concerns, such as those
stemming from covenant compliance, much revolver dependence or
lack of free cash flow. (All foregoing metrics are on a Moody's-
adjusted basis.)
The principal methodology used in this rating was the Global
Aerospace and Defense Industry published in April 2014. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.
Landmark Aviation is the acquisition vehicle through which
entities of the Carlyle Group acquired Landmark Aviation FBO
Holdings LLC ("Landmark Aviation"). Headquartered in Houston, TX,
Landmark Aviation proforma for the Ross acquisition will operate
76 bases for general aviation services across North America and
Western Europe. Principal offerings include refueling, light
maintenance and repair of private jets, replacement parts as well
as airplane parking, hangar and chartering on behalf of owners.
Proforma revenues for 2014 are expected to be about $750 million.
LM U.S. MEMBER: S&P Affirms 'B-' CCR Over Ross Aviation Deal
------------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its
'B-'corporate credit rating on LM U.S. Member LLC (Landmark
Aviation). The outlook is stable.
At the same time, S&P affirmed its 'B-' issue rating on the
company's enlarged first-lien credit facility, which consists of a
$110 million senior secured first-lien revolver due 2018 and a
$611 million first-lien senior secured term loan due 2019 (upsized
from $391 million). The '3' recovery rating on the debt remains
unchanged, indicating S&P's expectation for meaningful recovery
(50%-70%) in the event of payment default.
S&P also affirmed its 'CCC' issue rating on the company's $265.5
million senior secured second-lien term loan due 2020 (upsized
from $160 million). The '6' recovery rating on the debt remains
unchanged, indicating S&P's expectation for negligible recovery
(0%-10%) in a payment default scenario.
"The rating on Landmark Aviation reflects our expectation that the
company's leverage will remain high following the debt-financed
acquisition of Ross Aviation LLC," said Standard & Poor's credit
analyst Tatiana Kleiman. Landmark Aviation intends to issue $326
million of additional debt to fund the acquisition of Ross
Aviation and pay down existing revolver drawings (about $45
million).
This will result in Standard & Poor's adjusted pro forma debt to
EBITDA of 7x-8x and funds from operations (FFO) to debt of 6.5%-
9.5%, which represent a slight decline from S&P's previous
expectations for debt to EBITDA of 6x-7x and FFO to debt of 8%-11%
in 2014. S&P expects that earnings growth due to acquisition
contributions and a slowly rebounding general aviation market will
modestly improve Landmark Aviation's credit metrics over the next
12 months, with Standard & Poor's adjusted debt to EBITDA
declining to 6.5x-7.5x and FFO to debt improving to 7.5%-10.5% in
2015. S&P believes that debt reduction is unlikely to contribute
to improvements in the company's credit metrics until 2015. In
2014, S&P expects elevated capital expenditure requirements to
constrain free cash flow.
S&P's 'B-' corporate credit rating on Landmark Aviation's also
reflects the company's "fair" business risk profile and "highly
leveraged" financial risk profile assessments. The business risk
profile assessment incorporates the risks associated with the
company's exposure to the cyclical U.S. general aviation market,
its leading position in its markets and the high barriers to
entry, its good customer and geographic diversity, and its solid
profitability.
Pro forma for the acquisition of Ross Aviation, Landmark Aviation
will have about 63 locations in North America (76 globally), and
this will not change its position as the third-largest fixed-based
operator (FBO) in North America. The acquisition will, however,
close the gap between Landmark Aviation and the dominant players
in the industry, Atlantic Aviation and Signature Flight Support,
which each have about 65 locations.
The outlook is stable. S&P expects that Landmark Aviation's
credit ratios will remain weak over the next 12-18 months due to
increased debt from the acquisition and limited free cash flow and
debt reduction due to high capital expenditure requirements.
Revenue and earnings should grow modestly as a result of
acquisition contributions and stable-to-improving business jet
usage.
S&P could lower the rating if a weaker economy or a spike in fuel
prices decreases business jet usage, constraining the company's
liquidity such that S&P would revise its assessment to "less than
adequate" or "weak."
Although unlikely in the next year, S&P could raise the rating if
Landmark Aviation's cash flow is greater than it expects and the
company uses that cash flow to reduce debt, causing debt to EBITDA
to decrease to less than 5.5x, and demonstrating a shift towards a
less-aggressive financial policy.
MARTIFER SOLAR: Unit Amends List of Unsecured Creditors
-------------------------------------------------------
Martifer Aurora Solar USA, Inc., filed with the Bankruptcy Court
an amended list of creditors holding unsecured non-priority claims
against it, a copy of which is available for free at:
http://bankrupt.com/misc/MartiferSolar_AmdSchedF.PDF
The amended list indicates that the Debtor list a total of
57,827.61 in unsecured claims.
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.
The Debtors also won approval to hire FTI and Michael Tucker, a
senior managing director of FTI, to serve as the company's chief
restructuring officer.
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. The Committee has retained Pachulski Stang Ziehl &
Jones LLP's Bradford J. Sandler, Esq., Shirley S. Cho, Esq., Jason
Rosell, Esq., and Patricia Jeffries, Esq.; and Larson & Zirzow,
Matthew C. Zirzow, Esq., Zachariah Larson, Esq., and Carey
Shurtliff, Esq., as counsel.
* * *
Martifer Aurora Solar LLC intends to emerge from reorganization by
mid-July by selling the business. The Debtors said they hope to
have a so-called stalking-horse bidder signed to a contract in
time for an auction in mid-June. In court papers in May 2014, the
Debtors said FTI set May 15, 2014 as the deadline for the initial
letters of intent and has received four letters of interest. The
Debtors said they are formulating the bidding procedures for an
auction sale under section 363 instead of a plan, and are in the
process of selecting their stalking horse bidder.
MARTIFER SOLAR: Enters Into Termination Agreement With JinkoSolar
-----------------------------------------------------------------
Martifer Solar USA, Inc., is asking the Bankruptcy Court to
authorize it to terminate a contract with JinkoSolar (U.S.).
The Debtor and JinkSolar are parties to a contract where Jinko
supplied and the Debtor procured certain solar photovoltaic
modules it used in the construction of a solar photovoltaic
facility for Tier One Solar LLC to be located in Jackson, North
Carolina.
Before the Petition Date, the Debtor delivered a $332,520 deposit
as downpayment required under the Contract.
By a April 24, 2014 letter, the Debtor advised Jinko that the
Project would not proceed because Tier One has been unable to
procure funding and cannot guarantee payment to the Debtor.
The Debtor now seeks and and Jinko agrees to mutually terminate
the Contract on these terms:
* The Contract will be deemed terminated as of May 14, 2014,
and neither of the Parties will have any liability to the
other arising from or relating to the Contract.
* No later than 15 days after Jinko's receipt of the Order,
Jinko will deliver to the Debtor a payment for $292,520,
which represents 87.97% of the Deposit.
* For the avoidance of doubt, Jinko will be entitled to retain
the balance (12.03%) of the Deposit.
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.
The Debtors also won approval to hire FTI and Michael Tucker, a
senior managing director of FTI, to serve as the company's chief
restructuring officer.
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. The Committee has retained Pachulski Stang Ziehl &
Jones LLP's Bradford J. Sandler, Esq., Shirley S. Cho, Esq., Jason
Rosell, Esq., and Patricia Jeffries, Esq.; and Larson & Zirzow,
Matthew C. Zirzow, Esq., Zachariah Larson, Esq., and Carey
Shurtliff, Esq., as counsel.
* * *
Martifer Aurora Solar LLC intends to emerge from reorganization by
mid-July by selling the business. The Debtors said they hope to
have a so-called stalking-horse bidder signed to a contract in
time for an auction in mid-June. In court papers in May 2014, the
Debtors said FTI set May 15, 2014 as the deadline for the initial
letters of intent and has received four letters of interest. The
Debtors said they are formulating the bidding procedures for an
auction sale under section 363 instead of a plan, and are in the
process of selecting their stalking horse bidder.
MILAGRO OIL & GAS: Moody's Withdraws 'Caa3' Corp. Family Rating
---------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings assigned to
Milagro Oil & Gas, Inc.
Ratings withdrawn:
Issuer: Milagro Oil & Gas, Inc.
Caa3 Corporate Family Rating
Ca-PD / LD Probability of Default Rating
Ca LGD4 - 50% Senior Unsecured Notes Rating
Negative outlook
Ratings Rationale
Milagro Oil and Gas, Inc. is not current in its regulatory filings
with the last filing in November 2013. Moody's withdrew the
ratings because it has insufficient or otherwise inadequate
information to support the maintenance of the ratings.
Moody's previously downgraded Milagro's Probability of Default
Rating (PD) to Ca-PD/LD from Caa3-PD in December 2013 after the
company missed an interest payment and failed to cure the default
during the 30 day grace period which expired on December 16, 2013.
Milagro Oil & Gas, Inc. is an independent exploration and
production company headquartered in Houston, Texas.
MOMENTIVE PERFORMANCE: Committee, et al. Oppose Restructuring Deal
------------------------------------------------------------------
Momentive Performance's official committee of unsecured creditors
asked U.S. Bankruptcy Judge Robert Drain to deny approval of two
agreements supporting the company's plan to exit bankruptcy
protection.
The company filed a motion last month seeking approval of a
restructuring support agreement and another an agreement with
second-lien creditors backstopping financing for its
reorganization plan.
In a court filing, the unsecured creditors' committee questioned
the "liability-creating aspects" of the agreements.
Under the agreements, the second-lien creditors will receive a
backstop fee and expense reimbursements in return for the group's
commitment to support the plan and to backstop a $600 million
rights offering. The second-lien creditors also required the
company to indemnify them for losses and damages.
According to the committee, Momentive and the creditors group
involved in the deal are asking the bankruptcy court "to render
the estates administratively liable for a $30 million backstop
fee" even if the group loses the dispute over whether or not
senior subordinated notes should be subordinated to second lien
notes.
On May 30, U.S. Bank National Association, the indenture trustee
for holders of senior subordinated notes, filed a case seeking a
determination that the notes are not subordinated to the second
lien notes.
The move came after Momentive filed its plan, which the committee
says, is predicated on an assumption that claims tied to the
senior subordinated notes are contractually subordinated to claims
tied to the second lien notes and, therefore, are not entitled to
recovery under the plan.
"If the plan's foundational assumption that an entire group of
unsecured creditors ?- the senior subordinated noteholders -? are
entitled to nothing proves incorrect, there is a substantial risk
of costs, delay, and indeterminate treatment for all unsecured
creditors," the committee said in a court filing.
"As fiduciaries to all creditors, [Momentive] should ensure that
all parties' rights are fully preserved and that the recovery of
all unsecured creditors is not jeopardized depending on the
outcome of this dispute," the committee said.
U.S. Bank and Wilmington Trust N.A., trustee for certain senior
secured noteholders, also filed papers in opposition to the
agreements coming to court for approval on June 19.
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 the Debtors'
cases.
MOMENTIVE PERFORMANCE: Court Sets Deadlines for Filing Claims
-------------------------------------------------------------
U.S. Bankruptcy Judge Robert Drain approved the deadlines proposed
by Momentive Performance for filing claims against the company.
Pursuant to the judge's order, creditors other than governmental
units must file their pre-bankruptcy claims on or before 5:00 p.m.
(prevailing Eastern Time) on the date which is the first business
day that is 35 days after Momentive serves the notice of Bar Date
and proof of claim form.
Meanwhile, governmental units have to file their claims on or
before Oct. 10, at 5:00 p.m. (prevailing Eastern Time).
Any creditor whose claim stemmed from the rejection of an
executory contract or unexpired lease is required to file the
claim by the later of (i) the Bar Date; (b) 5:00 p.m. (prevailing
Eastern Time) on the date that is 30 days following the date of
service of notice of entry of an order authorizing the rejection;
or (iii) the date set by any other order of the bankruptcy court
authorizing the rejection.
In the event that Momentive amends its schedules of assets and
liabilities, any creditor affected by the amendment must file its
claim by the later of (i) the applicable Bar Date; and (b) 5:00
p.m. (prevailing Eastern Time) on the date that is 30 days from
the service of a notice of amendment to the creditor.
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 the Debtors'
cases.
NATIVE WHOLESALE: Opposes U.S. Trustee's Bid to Dismiss Case
------------------------------------------------------------
Native Wholesale Supply Co. is opposing the U.S. trustee's bid to
dismiss its Chapter 11 case or to convert it to a Chapter 7
liquidation.
A lawyer for the company said the grounds cited by the Justice
Department's bankruptcy watchdog for dismissal or conversion of
the case no longer exist.
Janet Burhyte, Esq., at Gross, Shuman, Brizdle & Gilfillan P.C.,
in Buffalo, New York, said the company is "current" in filing its
monthly operating reports and is profitable as show in those
reports.
Native Wholesale also intends to proceed to confirmation after it
has successfully formulated a plan to exit bankruptcy protection,
according to Ms. Burhyte. She expressed confidence that the plan
would be confirmed since the company's major creditors are either
proponents of the plan or they have expressed willingness to vote
in favor of the plan.
Meanwhile, the states of California, Idaho, New Mexico, New York,
and Oklahoma expressed support for the conversion or dismissal of
the case, saying the company "has not moved forward with the plan
process within a reasonable time period" and that they are not
convinced that there is a "reasonable likelihood of
rehabilitation."
The U.S. Bankruptcy Court for the Western District of New York
will hold a hearing on June 20 to consider the request of the U.S.
trustee.
About Native Wholesale Supply Company
Native Wholesale Supply Company is engaged in the business of
importing cigarettes and other tobacco products from Canada and
selling them to third parties within the United States. It
purchases the products from Grand River Enterprises Six Nations,
Ltd., a Canadian corporation and the Debtor's only secured
creditor. Native is an entity organized under the Sac and Fox
Nation and has its principal place of business at 10955 Logan Road
in Perrysburg, New York.
Native filed for Chapter 11 bankruptcy (Bankr. W.D.N.Y. Case No.
11-14009) on Nov. 21, 2011. The Chapter 11 filing was triggered
to resolve an ongoing dispute with the United States government
regarding up to $43 million in assessments made by the government
against the Debtor pursuant to the Fair and Equitable Tobacco
Reform Act of 2004 and the Tobacco Transition Payment Program and
to restructure the terms of payment of any obligation determined
to be owing by the Debtor to the U.S. under the Disputed
Assessment. The issues pertaining to the Disputed Assessment
resulted in two lawsuits, subsequently consolidated, now pending
in the Federal District Court.
Robert J. Feldman, Esq., and Janet G. Burhyte, Esq., at Gross,
Shuman, Brizdle & Gilfillan, P.C., in Buffalo, N.Y., represent the
Debtor as counsel.
The Company disclosed $30,022,315 in assets and $70,590,564 in
liabilities as of the Chapter 11 filing.
The States of California, New Mexico, Oklahoma and Idaho have
appeared in the case and are represented by Garry M. Graber, Esq.,
and Craig T. Lutterbein, Esq., at Hodgson Russ LLP, in Buffalo,
New York, and Karen Cordry, Esq., National Association of
Attorneys General, in Washington, D.C.
According to a Consensual Disclosure Statement for Joint
Consensual Plan of Reorganization of Native Wholesale Supply
Company, and the States dated March 6, 2014, the Debtor
established a Plan Funding Account at M&T and deposited
$5.5 million on Feb. 4, 2014, and an additional $500,000 was
deposited on Feb. 14, 2014. An additional $500,000 will be
deposited in the Plan Funding Account on each succeeding 15th day
of each month (or the first business day after the 15th)
beginning in March 2014 until the Plan is confirmed.
No trustee, examiner or creditors' committee has been appointed in
the case.
NEUSTAR INC: Moody's Lowers Corp. Family Rating to 'Ba3'
--------------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating (CFR) of Neustar, Inc. to Ba3 from Ba2 after the Federal
Communications Commission (FCC) issued a public notice seeking
comment on the North American Numbering Council's (NANC)
recommendation for Telcordia Technologies, Inc. to replace Neustar
as the local number portability administrator. Moody's believes
that Neustar is now at risk of losing the contract, which accounts
for approximately half the company's total revenue. However, the
transition timeline is uncertain and is likely to be drawn out
beyond the current contract end date, providing an opportunity for
Neustar to dedicate cash on hand and cash generated from the
remaining service term towards debt repayment.
As part of the rating action, Moody's has also downgraded
Neustar's probability of default rating (PDR) to Ba3-PD from Ba2-
PD, senior secured credit facilities to Ba2 (LGD3-30%) from Ba1
(LGD2-27%) and unsecured notes to B2 (LGD5-84%) from Ba3 (LGD5-
82%). Moody's has also affirmed the company's SGL-1 Speculative
Grade Liquidity (SGL) rating. The outlook is changed to negative
due to the absence of a firm commitment to prioritize debt
repayment with available cash and the risk that the company may
continue shareholder friendly activities despite the potential
contract loss.
Rating Rationale
Neustar's Ba3 corporate family rating reflects its small scale and
the potential loss of the local number portability contract which
accounts for approximately half of its revenues. The rating also
incorporates management's financial policy which lacks a
commitment to reduce debt to reflect the new business mix if the
company loses the contract while maintaining its current pace of
share repurchase. These weaknesses are offset by the company's
strong free cash flow generation and the probability of a contract
extension if Neustar is displaced, as the new provider would
struggle to implement its own new platform and be fully
operational for the July 2015 cutover.
Neustar has been the sole provider of the local number portability
contract since its inception in 1999. The contract accounts for
approximately half of the company's total revenue for the last
twelve months ended March 31, 2014. Moody's had previously
expected Neustar to win the contract extension given its strong
operating track record over the past 15 years. However, given the
recommendation from the NANC, Moody's believes that there is a
high likelihood that the FCC could adopt this recommendation and
award the contract to Telcordia. This would change the company's
existing business mix and Moody's expects margins to compress over
the near term as the company begins its cost cutting efforts.
Moody's expects Neustar to have very good liquidity over the next
twelve months supported by approximately $386 million of cash on
the balance sheet and $25 million available under its revolving
credit facility at the end of Q1. Moody's expects the company to
generate approximately $250 million in free cash flow over the
next year.
The ratings for the debt instruments reflect both the probability
of default of Neustar, to which Moody's assigns a PDR of Ba3-PD,
and individual loss given default assessments. The senior secured
credit facilities are rated Ba2 (LGD-3, 30%), one notch higher
than the CFR, given the support from the B2 rated senior unsecured
notes.
The negative outlook reflects the risk that Neustar continue to
engage in shareholder friendly activities despite the potential
loss of the contract.
Moody's could lower the rating further if Neustar definitively
loses the number portability contract and does not make a
commitment to materially reduce debt. Downward rating pressure
could develop if adjusted leverage increases towards 4x on a
sustainable basis or if FCF/Debt falls below 10%, which may result
from future debt-funded acquisitions or share buyback programs.
Due to the uncertainty surrounding the company's future revenues,
an upgrade is unlikely over the near term. Any rating action would
also be contingent upon the likelihood of contract renewal with
the NAPM and the maintenance of a prudent capital allocation
policy.
Based in Sterling, VA, Neustar, Inc is the leading provider of
information and data services catering to carriers and
enterprises. For last twelve month ending in March 31, 2014,
Neustar generated approximately $916 million in revenue.
Downgrades:
Issuer: Neustar, Inc
Probability of Default Rating, Downgraded to Ba3-PD from Ba2-PD
Corporate Family Rating, Downgraded to Ba3 from Ba2
Senior Secured Bank Credit Facility Jan 7, 2018, Downgraded to
Ba2 from Ba1, LGD3, 30 % from a range of LGD2, 27 %
Senior Secured Bank Credit Facility Jan 7, 2018, Downgraded to
Ba2 from Ba1, LGD3, 30 % from a range of LGD2, 27 %
Senior Unsecured Regular Bond/Debenture Jan 15, 2023,
Downgraded to B2 from Ba3, LGD5, 84 % from a range of LGD5,
82 %
Outlook Actions:
Issuer: Neustar, Inc
Outlook, Changed To Negative From Stable
Affirmations:
Issuer: Neustar, Inc
Speculative Grade Liquidity Rating, Affirmed SGL-1
The principal methodology used in this rating was 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.
NOVELIS INC: Moody's Confirms 'B1' Corporate Family Rating
----------------------------------------------------------
Moody's Investors Service confirmed Novelis Inc's B1 corporate
family rating and B1-PD probability of default rating. Moody's at
the same time confirmed the company's Ba2 senior secured term loan
rating and the B2 senior unsecured rating. The speculative grade
liquidity rating is unchanged at SGL-3. The outlook is stable.
This concludes the review for downgrade initiated on March 21,
2014.
Outlook Actions:
Issuer: Novelis Inc.
Outlook, Changed To Stable From Rating Under Review
Confirmations:
Issuer: Novelis Inc.
Probability of Default Rating, Confirmed at B1-PD
Corporate Family Rating, Confirmed at B1
Senior Secured Bank Credit Facility Mar 10, 2017, Confirmed at
Ba2
Senior Unsecured Regular Bond/Debenture Dec 15, 2017, Confirmed
at B2
Senior Unsecured Regular Bond/Debenture Dec 15, 2020, Confirmed
at B2
The confirmation reflects Moody's view that the downward pressure
on earnings has bottomed while strategic capital expenditures have
peaked and that 2015 will evidence good growth in earnings and
cash flow generation with favorable trends continuing in 2016.
With the major strategic capital expenditures for automotive
finishing capacity at Oswego, NY and other key initiatives in
Brazil and Asia largely completed (roughly $1.5 billion invested
over the two year period through Novelis' fiscal 2014), earnings
will benefit from the growth opportunities to be realized from
these investments, particularly in automotive sheet. Although
Moody's expect pricing and conversion margins in the US and Asian
can markets to continue to be challenging, Novelis is expected to
have a better product mix on a go forward basis as it begins to
supply the US automotive market this year. Consequently, Moody's
expect leverage, as measured by the debt/EBITDA ratio to improve
to around 4.5x -- 4.75x from a high of 6.3x at year-end March 31,
2014. Improvement in debt protection and leverage metrics is
expected to come from growth in earnings rather than material debt
reduction.
Ratings Rationale
The B1 corporate family rating (CFR) considers Novelis' focus on
creating more value added business as it expands its auto sheet
finishing capacity to capture increasing use of aluminum in the
automotive market while reducing more commodity type business such
as the former foil operations. The rating acknowledges the
company's large scale, significant market position, and global
footprint in the aluminum rolled products market, which includes a
dominant position in the beverage and food can sheet segment and
good positions in industrial and other high end specialties such
as electronics. The CFR also reflects the expectation for a
growing percentage of earnings to come from more value added sheet
sales to the automotive industry, contributing to a reduction in
the percentage of sales derived from the thinner margined can
sheet business. At the same time, the rating reflects the
variability of Novelis' sales to end markets, the sensitivity of
its earnings to volume levels given the level of fixed costs, as
well as dividend payments to its parent, Hindalco, ($1.95 billion
since 2011), which have significantly reduced the company's book
equity and tangible equity cushion given the high level of
intangibles and goodwill.
The stable outlook reflects Moody's view that Novelis will
generate improved earnings and operating cash flows given its more
favorable product mix and better fixed cost absorption with the
start up of its new facilities such that it will, over the next 12
to 18 months be able to achieve and sustain metrics appropriate
for a B1 rating.
The ratings on Novelis' secured term loan (Ba2) and senior
unsecured notes (B2) reflect the application of Moody's loss given
default methodology and the relative position of the liabilities
in the waterfall. Novelis also has a secured ABL facility, which
Moody's do not rate.
The Ba2 rating on the senior secured term loan reflects the
instrument's priority position in the capital structure and the
benefit of the loss absorption provided by a considerable amount
of unsecured debt below it.
The B2 rating on the senior unsecured notes reflects the
subordination of these instruments to a considerable amount of
secured debt under the term loan and the ABL, priority accounts
payables and the expectation of a considerable loss in value in a
default scenario.
The rating and/or outlook could be pressured should the company
experience sustained volume and margin declines or should the
improvement in credit metrics that are anticipated with the
completion and start-up of its strategic investments take longer
than originally expected. Quantitatively, ratings could be
downgraded if debt-to-EBITDA is likely to be sustained above 5.0
times, EBIT-to-interest below 2.0 times, or free cash flow remains
persistently negative. A significant contraction in liquidity or
availability under the ABL or further material dividend payments
could also negatively affect the rating or outlook.
An upgrade is unlikely at this time due to the company's more
leveraged profile following the balance sheet recapitalization and
weaker earnings performance in its calendar year 2014. However the
outlook or rating could be favorably impacted should the company
trend toward and demonstrate the ability to sustain EBIT/interest
above 4x, debt/EBITDA below 4.25x and (operating cash flow less
dividends)/debt of at least 20%.
Headquartered in Atlanta, Georgia, Novelis is the world's largest
producer of aluminum rolled products. The company operates through
four segments: North America, Europe, Asia, and South America.
While Novelis sells into a number of end markets, the company
currently ships a meaningful level to the can sheet market,
although increasing sales to the automotive market are
anticipated. For the twelve months ended March 31, 2014, the
company generated approximately $9.8 billion in revenues and had
total shipments of approximately 3.1 million metric tons (2.9
million tons rolled products).
The principal methodology used in this rating was Global Steel
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.
OCEANIA CRUISES: Moody's Raises Corporate Family Rating to 'B2'
---------------------------------------------------------------
Moody's Investors Service upgraded Oceania Cruises, Inc.'s
Corporate Family Rating to B2 from B3, its Probability of Default
Rating to B2-PD from B3-PD, and its senior secured bank revolver
and term loan to B1 from B2. The rating outlook is stable.
Ratings Rationale
The upgrade reflects a reduction in debt of approximately $100
million since year-end 2012 on rising EBITDA (up 32% since year-
end 2012) that has resulted in an improvement in reported
consolidated leverage and coverage metrics. As reported
debt/EBITDA declined to 6.8 times for twelve months ended March
31, 2014 and EBIT/interest improved to 2.2 times (from 8.5 times
and 1.8 times, respectively, at year-end 2012.) Including the
approximate $460 million accreted value of the 5% subordinated PIK
subordinated debt (PIK sub debt) held at the ultimate parent
level, debt/EBITDA dropped to 10 times from 14 times at year-end
2012. Moody's expects the PIK sub debt will convert to equity at
the time of an initial public offering. Moody's believe Oceania's
leverage will continue to decline due to modest EBITDA growth (3%-
5%) and mandatory debt amortization (about $90 million per annum)
on its ship loans and bank term loans, and a requirement to use up
to 50% (subject to reduction based on leverage) of annual excess
free cash flow to further prepay the bank term loan.
Oceania's B2 Corporate Family Rating reflects the company's small
scale in terms of revenue and number of ships, high leverage
relative to the assigned rating category, and the need for large
non-cancelable commitments of capital for new ships several years
in advance of delivery. Positive rating consideration is given to
the Oceania's good liquidity and interest coverage and its track
record in building a profitable market niche targeting destination
type cruises that appeal to the growing number of retirees with
disposal income and a propensity to travel.
Ratings upgraded:
Corporate Family Rating to B2 from B3
Probability of Default Rating to B2-PD from B3-PD
$75 million senior secured five-year first lien revolver to B1
(LGD 3, 34%) from B2 (LGD 3, 37%)
$300 million senior secured seven-year first lien term loan to
B1 (LGD 3, 34%) from B2 (LGD 3, 37%)
The stable rating outlook reflects Moody's expectation that growth
in cruise pricing (net revenue yield -- up 3%-3.5%) and EBITDA
coupled with mandatory debt amortization will result in a
continued decline in leverage over the next 12 -- 18 months.
Ratings could be downgraded if the Oceania's consolidated reported
debt/EBITDA increases above 7.25 times or if the company's good
liquidity profile deteriorates. Additionally, the B1 rating on
Oceania's proposed first lien debt (one-notch higher than the
company's B2 Corporate Family Rating) benefits from the
approximate $460 million sponsor subordinated payment-in-kind
("PIK") debt that Moody's includes in the liability structure for
LGD purposes. However, if the sponsor subordinated PIK debt were
to convert to equity, the first lien debt may lose the credit
support currently provided by the subordinated PIK debt, along
with the one-notch lift above the Corporate Family Rating that it
currently enjoys.
Ratings could be upgraded if Oceania's consolidated reported
debt/EBITDA declines to 5.0 times and it maintains good liquidity.
The principal methodology used in this rating was the Global
Lodging & Cruise Industry Rating Methodology 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.
OPTIM ENERGY: Deadline to Remove Suits Extended to Sept. 10
-----------------------------------------------------------
Judge Brendan Shannon of U.S. Bankruptcy for the District of
Delaware has given electricity producer Optim Energy, LLC until
Sept. 10 to file notices of removal of lawsuits involving the
company and its affiliates.
About Optim Energy
Optim Energy, LLC, and its affiliates are power plant owners
principally engaged in the production of energy in Texas's
deregulated energy market. Optim owns and operates three power
plants in eastern Texas: the Twin Oaks plant in Robertson County,
Texas, the Altura Cogen plant in Harris County, Texas and the
Cedar Bayou plant in Chambers County, Texas. The Altura and Cear
Bayou plants are fueled by natural gas, and the third is coal-
fired.
Optim Energy and its affiliates sought Chapter 11 protection from
creditors (Bankr. D. Del. Lead Case No. 14-10262) on Feb. 12,
2014.
The Debtors have tapped Bracewell & Giuliani LLP and Morris,
Nichols, Arsht & Tunnell LLP as attorneys; Protiviti Inc. as
restructuring advisors; and Prime Clerk LLC as claims agent.
Optim Energy, LLC scheduled $6,948,418 in assets and $716,561,450
in liabilities. Optim Energy Cedar Bayou 4, LLC, disclosed
$183,694,097 in assets and $717,646,180 in liabilities as of the
Chapter 11 filing. The Debtors have $713 million of outstanding
principal indebtedness.
On Feb. 27, 2014, Roberta A. DeAngelis, U.S. Trustee for Region 3,
notified the Bankruptcy Court that she was unable to appoint an
official committee of unsecured creditors in the Debtors' cases.
The U.S. Trustee explained that there were insufficient responses
to her communication/contact for service on the committee.
OPTIM ENERGY: Has Until Sept. 10 to Assume Lyondell, NRG Leases
---------------------------------------------------------------
U.S. Bankruptcy Judge Brendan Shannon has given electricity
producer Optim Energy until Sept. 10 to either assume or reject
two nonresidential real property leases.
Optim Energy leases from Lyondell Chemical Co. and NRG Texas Power
LLC real properties where its Altura Cogen and Cedar Bayou plants
are located.
Optimum Energy considers the two plants as a "key ingredient" to
its restructuring, which makes the leases "extremely important to
the debtors' value as a going concern," according to the company's
lawyer, Christopher Hayes, Esq., at Morris, Nichols, Arsht &
Tunnell LLP, in Wilmington, Delaware.
About Optim Energy
Optim Energy, LLC, and its affiliates are power plant owners
principally engaged in the production of energy in Texas's
deregulated energy market. Optim owns and operates three power
plants in eastern Texas: the Twin Oaks plant in Robertson County,
Texas, the Altura Cogen plant in Harris County, Texas and the
Cedar Bayou plant in Chambers County, Texas. The Altura and Cear
Bayou plants are fueled by natural gas, and the third is coal-
fired.
Optim Energy and its affiliates sought Chapter 11 protection from
creditors (Bankr. D. Del. Lead Case No. 14-10262) on Feb. 12,
2014.
The Debtors have tapped Bracewell & Giuliani LLP and Morris,
Nichols, Arsht & Tunnell LLP as attorneys; Protiviti Inc. as
restructuring advisors; and Prime Clerk LLC as claims agent.
Optim Energy, LLC scheduled $6,948,418 in assets and $716,561,450
in liabilities. Optim Energy Cedar Bayou 4, LLC, disclosed
$183,694,097 in assets and $717,646,180 in liabilities as of the
Chapter 11 filing. The Debtors have $713 million of outstanding
principal indebtedness.
On Feb. 27, 2014, Roberta A. DeAngelis, U.S. Trustee for Region 3,
notified the Bankruptcy Court that she was unable to appoint an
official committee of unsecured creditors in the Debtors' cases.
The U.S. Trustee explained that there were insufficient responses
to her communication/contact for service on the committee.
OPTIM ENERGY: Settles Dispute With Robertson Over Plant Valuation
-----------------------------------------------------------------
Optim Energy Twin Oaks, LP received court approval for a deal that
would resolve its dispute with the Robertson County Appraisal
District over the valuation of its electric power generating
plant.
Under the settlement, both sides agreed that the value of the
plant for the 2013 tax year is $70 million. The company will pay
the remaining $442,354 it owes the Robertson County Assessor-
Collector after it paid $961,640 in property taxes in January this
year.
Both sides also agreed that the appraised value of the plant for
the 2014 tax year is $70 million and that the appraised value for
certain tax exempt accounts related to pollution control equipment
that are not in dispute is nearly $1.57 million.
The agreement requires Robertson County to drop the claim it
previously filed, which asserts payment of more than $1.7 million.
This amount was calculated based upon the $128 million appraised
value for the 2013 tax year, according to court papers.
Meanwhile, Optim Energy is required to withdraw the motion it
filed with the U.S. Bankruptcy Court in Delaware in which it
sought the court's intervention in its dispute with Robertson
County. In that motion, the company asked the court to determine
the correct appraised value of the plant for the 2013 tax year.
A full-text copy of the settlement agreement can be accessed for
free at
The dispute began in May last year after Robertson County
conducted an appraisal of the plant, which was valued at $160.2
million. Optim Energy challenged the appraised value before the
Texas Appraisal Review Board, saying it was excessive and should
be lowered.
In July, the Appraisal Review Board denied, in part, the company's
protest and lowered the property valuation to $128 million. Optim
Energy appealed that decision to the Appraisal District in the
82nd Judicial District Court, in Robertson County.
About Optim Energy
Optim Energy, LLC, and its affiliates are power plant owners
principally engaged in the production of energy in Texas's
deregulated energy market. Optim owns and operates three power
plants in eastern Texas: the Twin Oaks plant in Robertson County,
Texas, the Altura Cogen plant in Harris County, Texas and the
Cedar Bayou plant in Chambers County, Texas. The Altura and Cear
Bayou plants are fueled by natural gas, and the third is coal-
fired.
Optim Energy and its affiliates sought Chapter 11 protection from
creditors (Bankr. D. Del. Lead Case No. 14-10262) on Feb. 12,
2014.
The Debtors have tapped Bracewell & Giuliani LLP and Morris,
Nichols, Arsht & Tunnell LLP as attorneys; Protiviti Inc. as
restructuring advisors; and Prime Clerk LLC as claims agent.
Optim Energy, LLC scheduled $6,948,418 in assets and $716,561,450
in liabilities. Optim Energy Cedar Bayou 4, LLC, disclosed
$183,694,097 in assets and $717,646,180 in liabilities as of the
Chapter 11 filing. The Debtors have $713 million of outstanding
principal indebtedness.
On Feb. 27, 2014, Roberta A. DeAngelis, U.S. Trustee for Region 3,
notified the Bankruptcy Court that she was unable to appoint an
official committee of unsecured creditors in the Debtors' cases.
The U.S. Trustee explained that there were insufficient responses
to her communication/contact for service on the committee.
OVERSEAS SHIPHOLDING: Lender Presentation Filed
-----------------------------------------------
Overseas Shipholding Group, Inc., on June 12, 2014, made available
to potential lenders certain information regarding its business
and operations, including summary projections of certain sources
and uses of cash of OSG contemplated in connection with OSG?s
emergence from bankruptcy. A copy of the Lender Presentation and
Memorandum is available at http://is.gd/DbyRyg
About Overseas Shipholding
Overseas Shipholding Group, Inc. (OTC: OSGIQ), headquartered in
New York, is one of the largest publicly traded tanker companies
in the world, engaged primarily in the ocean transportation of
crude oil and petroleum products. OSG owns or operates 111
vessels that transport oil and petroleum products throughout the
world.
Overseas Shipholding Group and 180 affiliates filed voluntary
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 12-20000) on
Nov. 14, 2012, disclosing $4.15 billion in assets and $2.67
billion in liabilities. Greylock Partners LLC Chief Executive
John Ray serves as chief reorganization officer. James L.
Bromley, Esq., and Luke A. Barefoot, Esq., at Cleary Gottlieb
Steen & Hamilton LLP serve as OSG's Chapter 11 counsel. Derek C.
Abbott, Esq., Daniel B. Butz, Esq., and William M. Alleman, Jr.,
at Morris, Nichols, Arsht & Tunnell LLP, serve as local counsel.
Chilmark Partners LLC serves as financial adviser. Kurtzman
Carson Consultants LLC is the claims and notice agent.
The Export-Import Bank of China, owed $312 million used for the
construction of five tankers, is represented by Louis R. Strubeck,
Jr., Esq., and Kristian W. Gluck, Esq., at Fulbright & Jaworski
LLP in Dallas; David L. Barrack, Esq., and Beret Flom, Esq., at
Fulbright & Jaworski in New York; and John Knight, Esq., and
Christopher Samis, Esq., at Richards Layton & Finger PA. Chilmark
Partners, LLC serves as financial and restructuring advisor.
Akin Gump Strauss Hauer & Feld LLP, and Pepper Hamilton LLP, serve
as co-counsel to the official committee of unsecured creditors.
FTI Consulting, Inc., is the financial advisor and Houlihan Lokey
Capital, Inc., is the investment banker.
U.S. Bank National Association is the successor administrative
agent under the $1.5 billion credit agreement, dated as of
February 9, 2006 by and among (a) OSG, OSG Bulk Ships, Inc., and
OSG International, Inc., as joint and several borrowers, (b) the
Administrative Agent and (c) various lenders party thereto.
Counsel to the Administrative Agent are Milbank, Tweed, Hadley &
McCloy LLP; Holland & Knight LLP; and Drinker Biddle & Reath LLP.
Lazard Freres & Co. LLC serves as advisor to the Administrative
Agent.
An official committee of Equity Security Holders has been
appointed in the case. It is represented by Brown Rudnick LLP's
Steven D. Pohl, Esq., James W. Stoll, Esq. and Jesse N. Garfinkle,
Esq.; Fox Rothschild LLP's Jeffrey M. Schlerf, Esq., John H.
Strock, Esq. and L. John Bird, Esq.
* * *
In March 2014, OSG filed a plan of reorganization that hinges on a
plan support agreement it struck with lenders holding an aggregate
of approximately 77% of amounts outstanding under the Company's
Unsecured Revolving Credit Facility. The Debtors and the so-
called Consenting Lenders also agreed to the terms of a
$300,000,000 rights offering, which would be backstopped by the
Consenting Lenders. The Original Plan generally provided that
creditors' allowed non-subordinated claims against the Debtors
other than claims under the Unsecured Revolving Credit Facility,
would be paid in full, in cash, including post-petition interest,
or reinstated and holders of equity interests and claims
subordinated pursuant to section 510(b) of the Bankruptcy Code
would receive a combination of shares of common stock and warrants
issued by reorganized OSG valued at approximately $61,400,000.
Under the Original Plan, holders of claims arising out of the
Unsecured Revolving Credit Facility would receive their pro rata
share of stock and warrants of the reorganized OSG. In addition,
the Original Plan provided that the 7.50% Unsecured Senior Notes
due in 2024 issued by OSG and the 8.125% Unsecured Senior Notes
due in 2018 issued by OSG will be reinstated, following payment of
outstanding interest. The Debtors also entered into a commitment
letter with Goldman Sachs Bank USA to provide $935,000,000 in exit
financing to the fund the Debtors' emergence from bankruptcy.
Late in April, following negotiations with equity holders and the
official committee of equity security holders, OSG abandoned the
agreement with the Consenting Lenders as well as the Original
Plan, and filed an amended Plan premised on an equity commitment
agreement with the Equity Holders, who collectively hold
approximately 30% of the outstanding shares of the Company. Each
Commitment Party has agreed to purchase shares in a rights
offering with an aggregate offering amount of $1,500,000,000, and
committed to purchase shares in respect of unexercised
subscription rights in the rights offering. The Debtors will
distribute to each Equity Holder one subscription right in respect
of each existing equity interest held by such Equity Holder. So-
called Class B securities carry an entitlement to distribution of
up to 10 % of the net litigation recovery in the malpractice
lawsuit against Proskauer Rose LLP and four of its partners.
The Debtors also abandoned the financing deal with Goldman Sachs
and, instead, accepted the funding offer from Jefferies Finance
LLC, which consisted of (a) a $600,000,000 term loan secured by a
first lien on the Debtors' U.S. Flag assets; (b) a $600,000,000
term loan secured by a first lien on the Debtors' International
Flag assets; (c) a $75,000,000 asset based revolving loan
facility; and (d) a $75,000,000 revolving loan facility.
Bankruptcy Judge Peter J. Walsh in Wilmington, Delaware, issued an
order dated May 27 approving the First Amended Disclosure
Statement explaining Overseas Shipholding Group, Inc.'s Joint Plan
of Reorganization. The Debtors have proposed a July 14, 2014 Plan
confirmation hearing.
PHILLIPS INVESTMENTS: Files Bare-Bones Chapter 11 Petition
----------------------------------------------------------
Phillips Investments, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. N.D. Ga. Case No. 14-61444) in Atlanta, Georgia, on June
11, 2014, without stating a reason. The Debtor estimated at least
$10 million in assets and liabilities.
The Debtor has tapped Scroggins & Williamson, P.C., under a
general retainer as attorneys.
According to the docket, the Debtor's Chapter 11 plan and
disclosure statement are due Oct. 9, 2014. The 11 U.S.C. Sec.
341(a) meeting of creditors is scheduled for July 11, 2014, at
11:00 a.m.
RADIAN GROUP: Moody's Assigns '(P)B3' Senior Unsecured Rating
-------------------------------------------------------------
Moody's Investors Service has assigned provisional ratings to
Radian Group Inc. under a multi-seniority shelf registration
statement that was filed by Radian on May 6, 2014. This shelf
registration statement replaced Radian's previous shelf
registration statement filed on August 9, 2012. Moody's currently
rates Radian Group's senior debt at B3, and Radian's principal
mortgage insurance operating subsidiaries Ba2 for insurance
financial strength. The outlook for the ratings is positive.
The registration statement includes various classes of debt,
preferred stock, common stock, depositary shares, warrants to
purchase common stock, rights to purchase common stock, preferred
stock or other securities, and stock purchase contracts issuable
by Radian Group Inc.
Rating Rationale -- Radian Group Inc.
Moody's said that Radian Group's B3 senior debt rating reflects
the improving credit profile of Radian Guaranty, its flagship
operating subsidiary, offset by the meaningful debt burden
relative to its liquidity and the fact that dividends from Radian
Guaranty are unlikely for the foreseeable future, given its still
weak regulatory capital position.
List of Rating Actions
The following provisional ratings have been assigned with a
positive outlook:
Radian Group Inc. -- senior unsecured debt at (P) B3;
Radian Group Inc. -- senior subordinated at (P) Caa1;
Radian Group Inc. -- subordinated at (P) Caa1;
Radian Group Inc. -- cumulative preferred stock at (P) Caa2;
Radian Group Inc. -- non-cumulative preferred stock at (P) Caa2.
Radian Group Inc. is a US-based holding company that owns a
mortgage insurance platform comprised of Radian Guaranty (Ba2 IFS
rating, positive outlook), Radian Mortgage Assurance (Ba2 IFS
rating, positive outlook) and Radian Insurance. In addition, it
owns Radian Asset Assurance (Ba1 IFS rating, negative outlook), a
financial guaranty insurance company. The group also has
investments in other financial services entities. As of March 31,
2014, Radian Group had $5.5 billion in total assets and $1.1
billion in shareholder's equity.
The principal methodology used in this rating was Moody's Global
Methodology for Rating Mortgage Insurers published in December
2012.
SAEXPLORATION HOLDINGS: Moody's Rates $150MM Sr. Sec. Notes Caa1
----------------------------------------------------------------
Moody's Investors Service assigned first-time ratings to
SAExploration Holdings, Inc. (SAEX), including a Caa1 Corporate
Family Rating (CFR), a Caa1 rating to the company's proposed
offering of $150 million senior secured notes, and a SGL-3
Speculative Grade Liquidity Rating. The rating outlook is stable.
Net proceeds from the note offering will be used to refinance
existing debt, acquire equipment related to the company's Alaska
operations, cover transaction fees and add cash to the balance
sheet.
Assignments:
Issuer: SAExploration Holdings, Inc.
Corporate Family Rating, Assigned Caa1
Probability of Default Rating, Assigned Caa1-PD
Speculative Grade Liquidity Rating, Assigned SGL-3
$150 Million Senior Secured Notes, Assigned Caa1 (LGD4, 51%)
Outlook, Assigned Stable Outlook
Ratings Rationale
The Caa1 CFR reflects SAEX's narrow business focus involving early
stage exploration and concession leasing activities which are
inherently volatile, the relatively small size of its asset and
earnings base within the broader oilfield services industry, risky
nature of its operations in remote and challenging geographic
locations, and reliance on a few customers for the majority of its
revenues. The rating also considers SAEX's limited contract
visibility beyond the next 12 months and the increased debt levels
following the proposed offering. The company's core seismic data
acquisition services are subject to wide variations in customer
demand and high competition. The Caa1 CFR incorporates SAEX's
comprehensive packaged services in remote locations that few of
its competitors can offer, multi-year relationships with many
large upstream companies, exposure to several geographic markets
and significant management ownership aligning financial interests
with other stakeholders.
Pro forma for the notes issue, SAEX will have a debt to EBITDA
ratio of about 5.6x as of March 31, 2014 (including Moody's
standard adjustments), which is considered high for this volatile
segment of the industry. However, the leverage ratio could improve
to about 4x by the end of 2014 based on Moody's projected adjusted
EBITDA of roughly $45-$50 million for the full year. Leverage may
improve further in 2015 when SAEX begins work on two large
projects in Alaska.
The Caa1 note rating reflects both the overall probability of
default of SAEX, to which Moody's assigns a PDR of Caa1-PD, and a
loss given default of LGD4 (51%). The proposed secured notes are
rated at the Caa1 CFR level given the small of amount of potential
priority claim debt in the capital structure. The note indenture
has a carve out for up to $30 million of first-lien revolving
credit facility, which is expected to be put in place shortly
after this notes offering. The notes will have guarantees from
restricted domestic subsidiaries only. While the notes will not be
guaranteed by SAEX's foreign subsidiaries, they will have a pledge
of 65% of the equity interest in those subsidiaries. SAEX's
foreign subsidiaries generated 88% of revenues and 86% of EBITDA
in 2013 and held 42% of the company's consolidated net assets at
March 31, 2014. However, following the contemplated equipment
purchases in Alaska and the initiation of two new contracts in
2015, the guarantor subsidiaries will represent a higher
proportion of revenues, EBITDA and assets.
The SGL-3 rating reflects Moody's belief that following the debt
issue, SAEX will have adequate liquidity through mid-2015. Moody's
expect approximately $45-$50 million of Moody's adjusted EBITDA in
2015 with significant year-on-year growth in 2015 resulting from
new contract awards. SAEX is currently negotiating with a number
of banks to secure commitment for a new credit facility in the
range of $20 million. Moody's final ratings will be subject to
review of the final documentation on the debt agreements. The
notes will not have any financial covenants. SAEX's alternative
liquidity is weak given its small tangible asset base and limited
marketability and useful lives of its equipment.
The stable outlook assumes SAEX will have adequate liquidity and
continue to increase and diversify cash flows. Given the highly
cyclical nature of SAEX's operating environment, an upgrade would
depend on improved scale and diversification, and reduced
leverage. If adjusted EBITDA can be sustained above $60 million
and leverage reduced to 3x, an upgrade could be considered. A
downgrade is likely if liquidity declines significantly to levels
that appear insufficient for the next 12 to15 months.
The principal methodology used in this rating was the Global
Oilfield Services Rating Methodology published in December 2009.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.
SAExploration Holdings, Inc. was founded in 2006 and provides
seismic data acquisition and processing services to the upstream
oil and gas industry in South America, North America and Southeast
Asia. SAEX offers a complete range of seismic data acquisition
services, including program design, planning and permitting, camp
services, survey, drilling, recording, reclamation and in-field
processing. The company is publicly traded on the NASDAQ under the
ticker symbol SAEX, and senior management owns roughly one-third
of SAEX's common shares.
SAEXPLORATION HOLDINGS: S&P Assigns 'B-' CCR; Outlook Stable
------------------------------------------------------------
Standard & Poor's Ratings Service said it assigned its 'B-'
corporate credit rating to SAExploration Holdings Inc. The
outlook on the rating is stable. At the same time, S&P assigned a
'B-' issue-level rating (the same as the corporate credit rating)
to the company's proposed $150 million senior secured notes due
2019, with a recovery rating of '3', indicating S&P's expectation
of meaningful (50% to 70%) recovery for lenders in the event of
default.
"The stable outlook reflects our expectation that SAExploration
will maintain adequate liquidity while expanding its asset base to
support growth," said Standard & Poor's credit analyst Ben
Tsocanos. "We expect revenue to increase substantially over the
next two years due to new contracts on the North Slope of Alaska
and with existing customers in South America."
S&P could lower ratings if contracts were not renewed or replaced,
resulting in weaker cash flow generation, or if working capital
absorbed cash beyond S&P's expectations to the point that
liquidity deteriorated below adequate levels without a clear path
to improvement.
S&P could raise ratings if SAExploration increased the scale of
its business in line with more highly rated peers while
maintaining leverage such that funds from operations to debt were
above 20%.
SANDIA DRILLING: Live Webcast Asset Auction Scheduled for July 1
----------------------------------------------------------------
By order of the U.S. Bankruptcy Court, Tiger Group's Remarketing
Services Division, Auction Resolutions LLC and PPL Group LLC will
conduct a live webcast auction at 10:30 a.m. (CT) on July 1 for
four complete trailer-mounted drilling rigs, rolling stock,
tubulars, and support equipment owned by Sandia Drilling Co. Ltd,
LLP and affiliate Sandia Drilling of Texas, LLC. The live auction
will be followed by a sealed bid offering of four complete
substructure rigs from the company's operations.
Bidders can attend the July 1 event in person at La Hacienda Event
Center, located at 12600 Texas 191 Frontage in Midland, or
participate in the live webcast through bidspotter.com. For
direct links to the sale catalog and the sealed bid package, and
to submit bids prior to the auction, go to www.SoldTiger.com
Previews of the various assets being offered will be held at three
locations: June 27-30, from 8:00 a.m. to 5:00 p.m. (CT), at Yard
No. 1 located at 12010 Hwy 191, Midland, TX; June 27-28, from
8:00 a.m. to 5:00 p.m. (CT), at Yard No. 2, located at 1675 IH 20
Rd S. in Waksom, TX; and June 28-30, from 8:00 a.m. to 5:00 p.m.
(CT) at Yard No. 3, located at 208 Rogers St., Pyote, TX
"Sandia spent considerable money upgrading and refurbishing their
rigs and support equipment over the years," said Kelly Toney,
President of Houston-based Auction Resolutions. "We are confident
that buyers will find tremendous value in this auction
opportunity."
Key assets featured in the auction include four Spencer Harris
7000 750 HP, three-axle trailer-mounted drilling rigs; nearly
100,000 feet of tubulars; as well as components that include
triplex and duplex mud pumps, generator sets, diesel engines,
tool-pusher's quarters, top doghouses, crew change/parts houses,
and variety of other support equipment.
The auction's rolling stock includes Kenworth, Freightliner, Mack,
and International tandem and tri-axle rig-up and winch trucks;
three, four and five axle trailers of up to 70 tons; light-duty
trucks; passenger trucks, and more.
The assets being offered in the sealed bid sale include a Skytop
Brewster N-85, 1,250 HP drilling rig; an RMI 750, 1,000 HP
drilling rig; and two Spencer Harris 7000, 1,000 HP drilling rigs.
Each unit is complete and ready to drill. Sealed bids are due by
3:00 p.m. (CT) on July 15.
For a full catalog of the items offered, yard locations for
individual items, and details on how to schedule a site visit and
bid, go to: www.SoldTiger.com
About Tiger Group
Tiger Group -- http://www.TigerGroup.com-- provides asset
valuation, advisory and disposition services to a broad range of
retail, wholesale, and industrial clients. With over 40 years of
experience and significant financial backing, Tiger offers a
uniquely nimble combination of expertise, innovation and financial
resources to drive results. Tiger's seasoned professionals help
clients identify the underlying value of assets, monitor asset
risk factors and, when needed, provide capital or convert assets
to capital quickly and decisively. Tiger's collaborative,
straight-forward approach is the foundation for its many long-term
'partner' relationships and decades of success. Tiger operates
main offices in Boston, Los Angeles and New York.
About Sandia Drilling Co. Ltd.
Sandia Drilling Co. Ltd. is a licensed and bonded freight shipping
and trucking company running freight hauling business from
Midland, Texas.
Sandia Drilling Co. Ltd., LLP and affiliate Sandia Drilling of
Texas, LLC filed for Chapter 11 bankruptcy on May 15, 2013 in the
Texas Eastern Bankruptcy Court (case number 2:13-bk-20099).
SBA COMMUNICATIONS: Moody's Rates $600MM Sr. Unsecured Notes 'B3'
-----------------------------------------------------------------
Moody's Investors Service has assigned a B3 rating to SBA
Communications Corporation's ("SBAC" or the "company") proposed
$600 million senior unsecured notes maturing 2022. In connection
with this rating action, Moody's lowered SBAC's Corporate Family
Rating (CFR) to B1 from Ba3, Probability of Default Rating (PDR)
to B1-PD from Ba3-PD and the company's existing debt instruments
by one notch, with the exception of the $800 Million 5.75% Senior
Notes residing at SBA Telecommunications, Inc., which were
downgraded by two notches to B3 from B1. Moody's also affirmed the
SGL-1 Speculative Grade Liquidity Rating. The rating outlook is
now stable.
New issue proceeds will be used to: (i) repay a portion of the
$500 million 4% Convertible Notes due October 2014 (the
"Convertible Notes"); (ii) fund (and prefund) the unwinding of a
portion of the Warrants associated with the Convertible Notes
(Moody's estimate the total value of the Convertible Warrants to
be about $913 million based on a $100 SBAC stock price); (iii)
repay the entire $244 million outstanding 8.25% Senior Notes due
2019 residing at SBA Telecommunications, Inc.; (iv) pay the call
premium associated with early retirement of the Convertible Notes;
and (v) for general corporate purposes. The 5.75% Senior Notes
were downgraded by two notches due to Moody's expectation that
over the coming year, SBAC will insert more secured debt in the
capital structure to retire the residual portion of the
subordinated Convertible Notes, which are ranked lowest the debt
capital structure and currently provide support for the 5.75%
Senior Notes. As a result of the extinguishment of the Convertible
Notes and higher proportion of secured debt, the 5.75% Senior
Notes will now experience higher loss absorption under Moody's
Loss Given Default (LGD) Methodology.
Ratings Assigned:
Issuer: SBA Communications Corporation
$600 Million Senior Notes due 2022 -- B3 (LGD-6, 93%)
Ratings Downgraded:
Issuer: SBA Communications Corporation
Corporate Family Rating to B1 from Ba3
Probability of Default to B1-PD from Ba3-PD
$500 Million 5.625% Senior Notes due October 2019 to B3 (LGD-6,
93%) from B2 (LGD-6, 93%)
Issuer: SBA Senior Finance II, LLC
$770 Million Senior Secured Revolving Credit Facility due May
2017 to Ba3 (LGD-3, 42%) from Ba2 (LGD-3, 41%)
$200 Million ($183 Million outstanding) Senior Secured Term
Loan A due May 2017 to Ba3 (LGD-3, 42%) from Ba2 (LGD-3, 41%)
$1.5 billion Senior Secured Incremental Term Loan B due March
2021 to Ba3 (LGD-3, 42%) from Ba2 (LGD-3, 41%)
Issuer: SBA Telecommunications, Inc.
$800 Million 5.75% Senior Notes due July 2020 to B3 (LGD-5,
85%) from B1 (LGD-5, 81%)
Ratings Affirmed:
Issuer: SBA Communications Corporation
Speculative Grade Liquidity -- SGL-1
The assigned rating is subject to review of final documentation
and no material change in the size, terms and conditions of the
transaction as advised to Moody's. Moody's will withdraw the B1
rating and LGD assessment (LGD-5, 81%) on the 8.25% Senior Notes
issued by SBA Telecommunications, Inc. upon their full repayment.
SBA COMMUNICATIONS: S&P Assigns 'B' Rating on $600MM Sr. Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its 'B' issue
level rating and '6' recovery rating to SBA Communications Corp.'s
proposed $600 million of senior unsecured notes. The '6' recovery
rating indicates Standard & Poor's expectation for negligible (0%
to 10%) recovery in the event of a default. Proceeds will be used
to redeem all of its 8.25% notes due 2019, to redeem $121 million
in principal of its 4% convertible senior notes due 2014, and to
fund the costs associated with an early unwind of a portion of
these convertible notes' warrants.
All other issue-level ratings for the company and its subsidiaries
remain unchanged.
S&P's 'BB-' corporate credit rating and stable outlook on SBA are
not affected by this issuance, which S&P believes will not
materially change the company's financial risk profile. S&P
expects leverage, including its adjustments for operating leases,
to be in the low- to mid-8x area at the end of 2014 under its
base-case scenario, in line with the existing 'BB-' rating.
RATINGS LIST
SBA Communications Corp.
Corporate credit rating BB-/Stable/--
New Ratings
SBA Communications Corp.
Senior unsecured
$600 mil. notes B
Recovery rating 6
SEARS METHODIST: Wins Okay to Borrow $600,000 From Bondholders
--------------------------------------------------------------
Cassandra Dowell, writing for Senior Housing News, reported that a
bankruptcy judge in Dallas on June 12 authorized Sears Methodist
Retirement System to borrow $600,000 from existing bondholders.
The money will be used for payroll purposes, SMRS spokeswoman
Nancy Shellhorse said.
According to Senior Housing News, citing court filings, SMRS
completed a refinancing plan in May 2013, during which it paid off
some existing bank debt. Following the refinancing plan, the
company maintained $99.1 million of overall debt. As part of the
refinancing plan, about $22.5 million of new money bonds were
issued to help replace the $17.8 million of bank loans previously
outstanding.
According to the report, the company said that, in part as a
result of the economic downturn and inability of seniors to sell
their homes, it is no longer able to meet its obligations.
Projected occupancy among its sites was not achieved, which
contributed to the need for financial restructuring, Ms.
Shellhorse told SHN in an email.
The report related that in 2013, the debtors collectively received
about $14.8 million in Medicare payments and about $5.5 million in
Medicaid payments, according to a court filing.
According to the report, Ms. Shellhorse said the decision to file
for Chapter 11 bankruptcy was made "after restructuring
negotiations between SMRS and certain holders of a significant
portion of the System's debt were unsuccessful."
Sears Methodist Retirement System, Inc., and 11 affiliates sought
Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Lead Case No.
14-32821) on June 10, 2014. Bankruptcy Judge Stacey G. Jernigan
presides over the case. SMRS et al. are represented by Vincent P.
Slusher, Esq., Andrew Zollinger, Esq., Thomas R. Califano, Esq.,
Gabriella L. Zborovsky, Esq., and Jacob S. Frumkin, Esq., at DLA
Piper LLP (US). The Debtors' financial advisor is Paul Rundell's
Alvarez & Marsal Healthcare Industry Group, LLC. Their investment
banker is Cain Brothers & Company, LLC. The notice, claims and
solicitation agent is GCG Inc.
SMRS et al. listed total assets of $34.1 million as of January
2014 and total liabilities of $103.8 million as of January 2014.
The petitions were signed by Mr. Rundell, chief restructuring
officer.
SCH CORP: 3rd Cir. Reinstates CFI Claimants' Appeal
---------------------------------------------------
A three-judge panel of the U.S. Court of Appeals for the Third
Circuit vacated a district court order that dismissed an appeal
taken by the so-called CFI Class Action Claimants over matters in
the Chapter 11 cases of SCH Corp., American Corrective Counseling
Services, Inc., and ACCS Corp. The appeals court remanded the
matter for the District Court to reconsider the appeal.
The Debtors were in the debt collection business in January 2009
when they filed for Chapter 11 bankruptcy in the District of
Delaware. They filed for bankruptcy on Jan. 19, 2009 (Bankr. D.
Del. Case No. 09-10198). The Debtors obtained confirmation of an
amended Chapter 11 plan on Nov. 2, 2009, which plan was declared
effective on Dec. 21, 2009.
The cases were consolidated, and Carl Singley was appointed as the
disbursing agent, litigation designee, and responsible officer for
each Debtor.
The CFI Claimants were the largest group of unsecured creditors in
the bankruptcy based on their role as plaintiffs in pending class
action lawsuits against the Debtors in California, Florida, and
Indiana. The lawsuits generally alleged violations of the Fair
Debt Collection Practices Act, 15 U.S.C. Sec. 1692 et seq., and
similar statutes. A group of plaintiffs with claims pending in
Pennsylvania comprised a separate class because an insurance
policy held by the Debtors applied to their claims.
The plan of liquidation provided for the sale of the Debtors'
business to National Corrective Group, Inc., a subsidiary of their
largest secured creditor. The CFI Claimants rejected a first
proposed plan because it included third-party releases that would
prohibit them and others from pursuing claims against NCG post-
bankruptcy. An amended plan, which removed the releases but
decreased the required plan funding, was confirmed in November
2009 with active support from the CFI Claimants. The confirmed
plan required NCG to pay the Debtors $200,000 per year for five
years but allowed it to offset these payments by certain
litigation costs. For their part, the Pennsylvania Claimants
received a judgment against the Debtors for $2.55 million,
enforceable solely against the Debtors' insurer. Soon after
confirmation, about $200,000 was distributed under the plan to
cover the fees of bankruptcy counsel and other preferential
claims. However, NCG asserted its set-off rights with respect to
the annual payments, and thus very little, if any, funds have been
distributed to unsecured creditors (including the CFI Claimants)
under the plan.
NCG's set-off rights came quickly into play as a result of
litigation that was filed by counsel for the CFI Claimants shortly
after the plan was confirmed. By January 2010 CFI Counsel,
representing a new set of plaintiffs, filed suit against NCG in
California. Like the pre-bankruptcy suits against the Debtors,
this class action lawsuit against NCG alleged violations of the
FDCPA, the Racketeer Influenced and Corrupt Organizations Act, 18
U.S.C. Sec. 1962, and state law. To their dismay, based on their
dual representation of the CFI Claimants and the plaintiffs in the
new California litigation, NCG moved to disqualify CFI Counsel in
both the pre- and post-bankruptcy litigation in that State. The
motions in both cases were granted.
Following the disqualification orders in California, the CFI
Claimants (through their counsel) moved to dismiss the Debtors'
bankruptcy cases for lack of good faith or, in the alternative, to
enforce the terms of the amended plan. The CFI Claimants argued
that Singley and NCG acted in bad faith by transferring the
Debtors' business to NCG while effectively insulating the new
company from liability. Although formally styled as a motion to
dismiss, the CFI Claimants sought a range of relief, including the
removal of Singley as the responsible officer and sanctions
against NCG.
The Bankruptcy Court held three days of hearings before denying
the motion to dismiss. It found, inter alia, that the bankruptcy
was several years post-confirmation and, although no significant
distributions had been made, that was not unexpected given the
terms of the amended plan. It concluded that there was no
persuasive evidence of gross negligence by Singley nor did he act
in bad faith by cooperating with NCG's defense in the post-
bankruptcy litigation in California. The Bankruptcy Court noted
that, to the extent CFI Counsel sought review of the
disqualification rulings in California, a federal court in
Delaware could not grant such relief.
The CFI Claimants appealed that order to the District Court
pursuant to 28 U.S.C. Sec. 158(a). Instead of deciding the appeal
on the merits, the District Court granted Singley's motion to
dismiss the appeal as equitably moot.
According to Judge Thomas L. Ambro, who penned the Third Circuit
opinion, "What gives us pause in reviewing the District Court's
order is the conclusion that dismissal was appropriate even though
'the record does not indicate that reversing the amended plan
would result in 'great difficulty or inequity.'' To invoke equity
when there is no inequity is counterintuitive. Moreover, it is in
tension with the guiding principle that matters should generally
be decided on their merits when that is possible."
"We also question whether the District Court considered the full
range of relief the CFI Claimants sought and the specific effect
that relief would have on third parties," he said.
Judge Ambro also held that a merits decision may be necessary
because "[d]ismissing an appeal as equitably moot should be rare,
occurring only where there is sufficient justification to override
the statutory appellate rights of the party seeking review."
A copy of the Third Circuit's Opinion dated June 17, 2014, is
available at http://is.gd/q1Ul72from Leagle.com.
Counsel for the CFI Claimants are:
Irv Ackelsberg, Esq.
Howard I. Langer, Esq.
John J. Grogan, Esq.
LANGER, GROGAN & DIVER
1717 Arch Street
The Bell Atlantic Tower, Suite 4130
Philadelphia, PA 19103
- and -
Christopher D. Loizides, Esq.
LOIZIDES & ASSOCIATES
1225 King Street, Suite 800
Wilmington, DE 19801
Counsel for Appellee is:
Thomas H. Kovach, Esq.
Anthony M. Saccullo, Esq.
A.M. SACCULLO LEGAL
27 Crimson King Drive
Bear, DE 19701
- and -
Daniel K. Astin, Esq.
John D. McLaughlin, Jr., Esq.
Joseph J. McMahon, Jr., Esq.
CIARDI CIARDI & ASTIN
1204 North King Street
Wilmington, DE 19801
SERVICEMASTER COMPANY: Moody's Rates Senior Secured Loan (P)B2
--------------------------------------------------------------
Moody's Investors Service assigned a provisional (P)B2 rating to
The Servicemaster Company, LLC's proposed senior secured revolving
credit facility due 2019 and senior secured term loan due 2021.
Moody's also affirmed ServiceMaster's B3 Corporate Family rating
("CFR"), B3-PD Probability of Default rating ("PDR"), the B1
rating on the existing senior secured instruments, Caa1 ratings on
the senior unsecured guaranteed notes due 2020, the Caa2 ratings
on the senior unsecured unguaranteed notes due 2018, 2027 and 2038
and the SGL-2 Speculative Grade Liquidity rating ("SGL"). The
rating outlook remains negative.
The proceeds of the proposed term loan would be used, along with
the proceeds of an initial public offering of primary shares
("IPO") and cash, to repay existing senior secured debt, redeem a
portion of the existing senior unsecured notes due 2020 and pay
related fees and expenses. The proposed senior secured revolver
and term loan are contingent upon the completion of an IPO, the
net proceeds of which must be used to repay indebtedness. Moody's
expects to remove the provisional designation from the proposed
senior secured ratings when the new debt closes. The ratings on
the existing senior secured instruments will be withdrawn when
they are repaid.
Ratings Rationale
"An IPO of at least $500 million and resulting debt repayment
would reduce financial leverage by over a turn and increase
ServiceMaster's operating flexibility, and would likely lead to a
stable ratings outlook," noted Edmond DeForest, Moody's Senior
Analyst.
Moody's expects high debt to EBITDA (after Moody's standard
adjustments) in the range of 6.5 to 7.0 times in 2014 after an IPO
of $500 million to $1 billion, assuming all net proceeds are used
to repay debt. However, Moody's anticipates ServiceMaster will
remain profitable, generate at least $450 million of EBITDA, $100
million of free cash flow (before deducting non-recurring expenses
from financing activities) and maintain its leading position in
its termite and pest management and home warranty businesses,
lending support to the ratings. Moody's considers ServiceMaster's
liquidity good.
The (P)B2 rating on the proposed senior secured revolver and term
loan reflects the security structure and a loss given default
assessment of LGD3 (33%). The expected repayment of senior
unsecured debt with the proceeds of the proposed IPO results in a
debt capital structure with a greater proportion of senior secured
debt, leading to the senior secured rating only one notch above
the CFR. The credit facility is secured by a first lien pledge of
substantially all of the domestic assets, but not the stock of,
the guarantor subsidiaries through secured upstream guarantees.
The guarantor subsidiaries exclude AHS. The senior secured debt is
also guaranteed by the parent of the borrower.
The negative ratings outlook reflects Moody's concerns that
customer count declines at Terminix could accelerate in 2014,
pressuring revenue growth and profit margins and slowing the pace
of deleveraging. The ratings could be downgraded if
Servicemaster's steady revenue and profit growth trajectory is
interrupted, leading to free cash flow declines and diminished
liquidity. The rating outlook could be stabilized through a
reduction in debt from the net proceeds of an IPO of at least $500
million, or if Moody's anticipates steady revenue and
profitability growth in its major business segments such that
further material deleveraging is expected to occur. The ratings
could be upgraded if, through IPO proceeds of over $1 billion or
by steady revenue and profitability growth in major business
segments, ServiceMaster reduces financial leverage and grows free
cash flow, while maintaining good liquidity and balanced financial
policies. If Moody's expects debt to EBITDA and free cash flow to
debt will be sustained at less than 5.5 times and above 5%,
respectively, the ratings could be raised.
Assignments:
Issuer: The ServiceMaster Company, LLC
Senior Secured Revolving Credit Facility due 2019, Assigned
(P)B2, LGD3
Senior Secured Term Loan due 2021, Assigned (P)B2, LGD3
Affirmations:
Issuer: The ServiceMaster Company, LLC
Corporate Family Rating, Affirmed B3
Probability of Default Rating, Affirmed B3-PD
Speculative Grade Liquidity Rating, Affirmed SGL-2
Senior Secured Credit Facility, Affirmed B1
Senior Unsecured Bond due Aug 15, 2020, Affirmed Caa1
Senior Unsecured Bond due Feb 15, 2020, Affirmed Caa1
Issuer: ServiceMaster Company (The) (Old)
Senior Unsecured Bond due 2038, Affirmed Caa2
Senior Unsecured Bond due 2018, Affirmed Caa2
Issuer: ServiceMaster Company LimitedPartnership(The)
Senior Unsecured Bond due 2027, Affirmed Caa2
Outlook Actions:
Issuer: The ServiceMaster Company, LLC
Outlook, Remains Negative
Issuer: ServiceMaster Company (The) (Old)
Outlook, Remains Negative
Issuer: ServiceMaster Company LimitedPartnership(The)
Outlook, Remains Negative
The principal methodology used in these ratings 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.
ServiceMaster is a national provider of termite and pest control,
home service contracts, cleaning and disaster restoration, house
cleaning, furniture repair and home inspection products and
services through company-owned operations and franchise licenses.
Brands include: Terminix, American Home Shield (AHS),
ServiceMaster Clean, Merry Maids, Furniture Medic and AmeriSpec.
SHRIMP BOAT: Foreclosure Sale on July 18, but Owner to Seek Ch.11
-----------------------------------------------------------------
Valerie Garman, writing for Florida's The News Herald, reported
that The Shrimp Boat Restaurant property and several surrounding
parcels are scheduled to be auctioned July 18, but owner Loren
Smith said June 16 he intends to file for Chapter 11 bankruptcy
reorganization, which would halt the foreclosure process.
According to the report, the 31,000-square-foot restaurant
building houses The Shrimp Boat Restaurant, Gracie Rae Bar &
Grill, the Salty Hawg Oyster Bar and a new lounge, Lowe's House of
Bourbon, which opened in 2013. As outlined in the auction notice
last week, the foreclosure also includes five other parcels
surrounding the restaurant, including the restaurant's parking
areas and the Smith's Yacht Basin .
Debt is owed under a 2006 construction loan originated by
Prosperity Bank. The report noted that the loan was converted
into a commercial mortgage with a five-year balloon payment also
through Prosperity. The report did not indicate the amount of the
outstanding debt.
"The gist of it is -- we're not going anywhere, we're not closing,
there won't be any business interruption," Mr. Smith said,
according to the report. "We're actually pursuing Chapter 11
reorganization in order to keep our 100 jobs, the marina and St.
Andrews thriving."
TERRAFORM POWER: S&P Assigns Prelim. 'BB-' CCR; Outlook Stable
--------------------------------------------------------------
Standard & Poor's Ratings Services said it assigned its
preliminary 'BB-' long-term corporate credit rating to TerraForm
Power Inc. At the same time, Standard & Poor's assigned its
preliminary 'BB' issue-level rating to subsidiary TerraForm Power
Operating LLC's $300 million senior secured term loan B due 2019.
The recovery rating is '2', indicating that lenders can expect
high (70%-90%) recovery if a default occurs. The outlook is
stable.
The ratings on Terraform reflect its 'bb-' stand-alone credit
profile. S&P believes its business risk profile is "weak." "We
base this primarily on the company's small scale and limited fuel
diversity, which its cash flow stability stemming from long-term
fee based power purchase agreements with highly rated
counterparties only partially offsets," said Standard & Poor's
credit analyst Nora Pickens.
TerraForm's "significant" financial risk profile incorporates
S&P's view of the company's moderate financial leverage, material
dependence on upstream dividends from assets with structurally
senior project level debt, and the yieldco structure that highly
gives management incentive to pay out the majority of available
free cash flow after maintenance capital expenditures.
Pro forma TerraForm's initial public offering (likely in third-
quarter 2014), SunEdison Inc. will own about 60% of the company's
common stock and 100% of the incentive distribution rights.
SunEdison has substantial control over TerraForm, so S&P has
linked the ratings. However, in S&P's view, TerraForm benefits
from structural protections, allowing the rating to be higher than
those on its parent company. A non-consolidation opinion supports
S&P's view that TerraForm is severable from its parent, holds
itself out as a separate entity, and would not be materially
impacted by financial distress at SunEdison. In addition,
TerraForm's independent directors must approve any form of
bankruptcy proceedings, disposal of material assets, and
initiation of transactions between TerraForm and SunEdison.
Although the two companies have multiple support agreements, S&P
believes third-party providers could step in without material
disruption to TerraForm's operational or financial risk profile.
At this time, SunEdison's creditworthiness is not a constraint on
S&P's corporate credit rating on TerraForm.
The company owns a portfolio of 21 solar projects operating or in
late-stage construction with nameplate capacity of 524 megawatts.
The projects are in four countries, including the U.S. (60% of
estimated 2015 EBITDA), the U.K. (22%), Canada (10%), and Chile
(9%). The solar projects are fully contracted with highly rated
counterparties and a weighted average remaining life of 18 years.
Project cash flows depend on the availability of solar resources,
but S&P expects a high degree of cash flow stability given the
arrangements' fee-based nature and solar power's good reliability
in general. The company benefits from owning mostly utility
projects (supply power at the utility level, rather than to local
users) which, in S&P's view, are less risky than distributed
generation panels. Solar farms are installed in regions
identified and developed for optimal solar generation, so
unexpected intrusions (such as falling branches or shade) are less
likely. As such, S&P expects panel maintenance to be less time
consuming and more efficient than that of dispersed solar panels
associated with distributed generation.
The stable outlook on TerraForm reflects S&P's expectation for
minimal merchant price risk and debt to EBITDA in the 3.0x-3.5x
range. Apart from a reassessment of SunEdison's group credit
profile, S&P could lower the ratings on TerraForm if the
company begins to assume more significant merchant price risk or
if credit measures weaken such that debt to EBITDA rises above
4.5x. Absent an upgrade of SunEdison's group credit profile, S&P
would not envision upgrading TerraForm because of the link between
the two companies.
TW TELECOM: Moody's Places Ba3 CFR Under Review for Downgrade
-------------------------------------------------------------
Moody's Investors Service has placed the Ba3 Corporate Family
Rating and the Ba3-PD Probability of Default rating of tw telecom
inc. (TWTC) under review for downgrade, while leaving its SGL-1
liquidity rating unchanged. At the same time, Moody's also placed
the Baa3 Senior Secured and B1 Senior Unsecured ratings of TWTC's
subsidiary, tw telecom holdings inc (TWTH), under review for
possible downgrade. This action follows Level 3 Communications
Inc.'s (Level 3, B3 review for upgrade) announcement that it will
acquire TWTC in a $7.5 billion enterprise value stock-and-cash
transaction that was announced on 16 June 2014. Pending normal
regulatory approvals, the transaction is expected to close in the
fourth quarter of 2014.
On Review for Possible Downgrade:
Issuer: tw telecom holdings inc.
Senior Secured Bank Credit Facility, Placed on Review for
Possible Downgrade, currently Baa3
Senior Unsecured Regular Bond/Debenture, Placed on Review for
Possible Downgrade, currently B1
Issuer: tw telecom inc.
Probability of Default Rating, Placed on Review for Possible
Downgrade, currently Ba3-PD
Corporate Family Rating, Placed on Review for Possible
Downgrade, currently Ba3
Outlook Actions:
Issuer: tw telecom holdings inc.
Outlook, Changed To Rating Under Review From Negative
Issuer: tw telecom inc.
Outlook, Changed To Rating Under Review From Negative
Ratings Rationale
Moody's has placed TWTC and TWTH's ratings under review for
downgrade reflecting Level 3's weaker credit profile and a high
likelihood of the closing of the acquisition. The review of TWTC
and TWTH's ratings will focus on Level 3's plans regarding the
existing debt at TWTC and TWTH. Should the debt be legally assumed
by Level 3, the ratings will likely be downgraded. The current
indentures and credit agreements require TWTC and TWTH to repay
existing debt within 30 days, under a change of control triggering
event and a rating decline. If the debt is not repaid, Moody's
will focus on the placement of TWTC and TWTH's debt within the
Level 3 priority-of-claim waterfall under its LGD methodology, and
likely withdraw TWTC's own CFR and SGL ratings.
With head offices in Littleton, Colorado, tw telecom inc. is a
competitive communications provider. The company provides managed
network services, Internet access, virtual private network, voice
and data services, and network security to enterprise
organizations and communications services companies throughout the
US. TWTC's footprint extends to 75 of the top 100 markets in the
US.
The principal methodology used in this rating was the Global
Telecommunications 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.
WEST CORP: Moody's Assigns 'B3' Rating on $1-Bil. Unsecured Notes
-----------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to West
Corporation's proposed senior secured credit facilities comprising
a $300 million revolving credit facility and a $350 million
delayed draw term loan A facility, and a B3 rating to the
company's proposed $1 billion of senior unsecured notes. The
company will use the net proceeds of the notes offering to
repurchase the existing 8.625% senior notes due 2018 and up to an
aggregate of $200 million of the outstanding 7.875% senior notes
due 2019. The proceeds of the new delayed draw term loans will be
used to prepay a portion of outstanding term loans and redeem any
outstanding senior notes due 2019. As part of the ratings action,
Moody's affirmed West's B1 Corporate Family Rating ("CFR") and B1-
PD probability of default rating, and downgraded the company's
Speculative Grade Liquidity rating to SGL-2, from SGL-1. The
ratings outlook is stable.
Ratings Rationale
Moody's estimates that pro forma for the proposed transactions
West's total debt to EBITDA (Moody's adjusted, mainly for
capitalized operating lease and non-cash stock compensation) will
be approximately 5.3x. The leverage also incorporates the fully
drawn $185 million trade accounts receivables facility which was
utilized to complete the acquisition of Health Advocate for $265
million. West Corporation's liquidity has been diminished as a
result of the utilization of its liquidity facilities and
reduction in cash by approximately $155 million in connection with
the acquisitions of Health Advocate and SchoolMessenger which
closed in the current quarter. The SGL-2 liquidity rating reflects
Moody's expectation that West will maintain good liquidity mainly
consisting of estimated annual free cash flow (after dividends) of
at least $160 million and availability under the new $300 million
of revolving credit facility that could be partially drawn to
complete the refinancing transactions.
West's B1 CFR is characterized by its high financial leverage,
modest organic growth prospects, and the highly competitive
operating environment and technology risks affecting the company's
businesses. Moody's expects that West will continue to rely on
acquisitions to augment its organic growth. Moody's also expects
West's total debt to EBITDA to slowly decline toward 5.0x over the
next 12 to 18 months from EBITDA growth of about 2% to 3%,
including incremental contribution from acquisitions, and
repayment of debt.
The B1 rating is supported by West's good projected free cash flow
(after dividend) of about 5% to total debt in the next 12 to 18
months, and its large operating scale and leading market position
in the conferencing and collaboration and emergency communication
service markets.
The stable ratings outlook reflects Moody's expectations that West
will maintain good liquidity, gradually improve total debt to
EBITDA toward 5.0x, and generate modest revenue growth and stable
EBITDA margins over the next 12 to 18 months.
Moody's does not anticipate a ratings upgrade given West's limited
organic growth prospects and expected leverage levels in the
intermediate term. However, West's ratings could be upgraded over
time if debt reduction or strong profitability results in total
debt to EBITDA below 4.5x and free cash flow to debt (after
dividends) in the high single digit percentages on a sustainable
basis. West's ratings could be downgraded if weak operating
performance, debt-funded acquisitions or shareholder-friendly
financial policies result in deterioration of liquidity, or total
debt / EBITDA increases above 5.5x or free cash flow to debt
declines to the low single percentages.
Moody's has taken the following raings actions:
Issuer: West Corporation
Ratings affirmed (Loss Given Default estimates revised) :
Corporate Family Rating -- B1
Probability of Default Rating -- B1-PD
$312 million (outstanding) senior secured term loan B due July
2016 --Ba3 (LGD3, to 35% from 32%)
$2.1 billion (outstanding) senior secured term loan B due June
2018 -- Ba3 (LGD3, to 35% from 32%)
$650 million 7.875% senior unsecured notes due 2019 -- B3
(LGD5, to 88% from 86%)
Ratings Assigned:
$300 million senior secured revolving credit facility due 2019
-- Ba3 (LGD3, 35%)
$350 million delayed draw senior secured term loan A due 2019
-- Ba3 (LGD3, 35%)
$1 billion senior unsecured notes due 2022 -- B3 (LGD5, 88%)
Ratings downgraded:
Speculative Grade Liquidity Rating -- SGL-2, from SGL-1
Ratings to be withdrawn upon repayment and cancellation of debt:
$201 million senior secured revolving credit facility due
January 2016, Ba3 (LGD3, 32%)
$500 million 8.625% senior unsecured notes due 2018, B3 (LGD5,
86%)
West Corporation is a leading provider of technology-driven and
agent-based communication services with approximately $2.7 billion
in revenues for the trailing twelve months ended March 2014. The
Thomas H. Lee Funds, Quadrangle Group Funds, Gary L. West, Mary E.
West, and members of management hold about 70% of the common
stock.
WEST CORP: S&P Rates $1-Bil. Senior Notes Due 2022 'B+'
-------------------------------------------------------
Standard & Poor's Ratings Services affirmed all existing ratings,
including the 'BB-' corporate credit rating, on Omaha, Neb.-based
business process outsourcer West Corp. The rating outlook is
stable.
At the same time, S&P assigned the company's issued $350 million
senior secured term loan A due 2019 an issue-level rating of 'BB+'
(two notches above the 'BB-' corporate credit rating on the
company), with a recovery rating of '1', indicating S&P's
expectation for very high (90% to 100%) recovery for bondholders
in the event of a payment default.
In addition, S&P assigned the company's issued $1 billion senior
notes due 2022 its issue-level rating of 'B+' (one notch below the
'BB-' corporate credit rating on the company), with a recovery
rating of '5', indicating S&P's expectation for modest (10% to
30%) recovery for bondholders in the event of a payment default.
The company will use the proceeds of the notes, the term loan, and
some additional credit revolving capacity to refinance its
existing senior bonds, repay a portion of its term loan B, and
fund the acquisition of Health Advocate Inc.
"In our view, the rating on West Corp. reflects our expectation
that leverage will remain relatively high, in the 4x to 5x area
over the intermediate term, as the company will continue its
acquisition-oriented growth strategy, albeit under a less
aggressive financial policy. This expectation underscores our
assessment of West Corp.'s financial risk profile as "aggressive"
(based on our criteria). West Corp. has been an active acquirer
of automated business services companies as it seeks to expand its
presence in higher-margin areas. We view the company's business
risk profile as "fair," based on its good EBITDA margin and
relative stability of revenue. We believe these dynamics will
result in West achieving low- to mid-single-digit percentage
revenue and EBITDA growth, on average, over the intermediate term,
with leverage gradually declining following a near-term increase,"
S&P said.
West Corp. is a business process outsourcer of conferencing
services, public safety services, automated alerts, notifications
services, and agent-based and automated call center services, with
operations in the U.S., the U.K., and many other countries. The
company has a good EBITDA margin and competitive position in the
fragmented, highly competitive market for communication services.
West Corp. competes with larger peers with significant offshore
operations, and often competes with clients' in-house
capabilities. The market for conferencing services is
competitive, despite healthy margins. West Corp. strives to
increase call volume and reduce costs to offset steadily declining
pricing, which it has generally accomplished. This trade-off will
likely hurt its EBITDA margin over time. Nonetheless, S&P
believes longer-term trends generally will continue to favor
outsourcers such as West Corp., as companies continue outsourcing
noncore functions to extract operating efficiencies.
WEX INC: S&P Puts 'BB' Issuer Credit Rating on CreditWatch Neg.
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it placed its ratings
on South Portland, Maine-based WEX Inc., including the 'BB' issuer
credit rating, on CreditWatch with negative implications.
The CreditWatch listing follows WEX's announcement that it has
entered a definitive agreement to acquire Evolution1, a payments
solution provider in the health care industry, for approximately
$532.5 million. The acquisition is expected to close in the third
quarter of 2014. WEX anticipates financing the acquisition with a
combination of cash and borrowings under its $700 million
revolving credit facility. If the acquisition closes, over the
next 12 months S&P expects debt to adjusted EBITDA to exceed 3x
(debt to adjusted EBITDA including deposits would exceed 6x),
which is high for a 'BB' rating.
"Although we have incorporated WEX's propensity for making debt-
financed acquisitions into our assessment, this acquisition is
larger than we had expected," said Standard & Poor's credit
analyst Igor Koyfman. A potential downgrade would reflect S&P's
view that the company's willingness to fund such a large
acquisition with debt is aggressive, especially in light of the
company's previously announced plans to acquire the assets of
ExxonMobil's European commercial fuel card program (Esso Card)
through a majority-owned joint venture in fourth-quarter 2014 or
first-quarter 2015. On the other hand, from a business
standpoint, S&P believes the acquisitions of Evolution1 and Esso
Card would increase the company's scale and diversity.
S&P will resolve the CreditWatch listing following further review
of the financial and business risks of the planned Evolution1
acquisition. The CreditWatch listing with negative implications
reflects S&P's view that we could lower (by one notch) or affirm
the ratings following the completion of its review.
WINEBOW GROUP: Moody's Assigns 'B2' Corporate Family Rating
-----------------------------------------------------------
Moody's Investors Service assigned a first time Corporate Family
Rating (CFR) and Probability of Default Rating (PDR) of B2 and B2-
PD, respectively, to The Winebow Group, LLC, ("The Winebow
Group"), a new company formed through the combination of Winebow,
Inc. ("Winebow") and The Vintner Group, Inc. ("Vintner"), two
leading importers and distributors of fine wines and craft
spirits. Moody's also assigned a B1 (LGD3, 42%) rating to The
Winebow Group's proposed $230 million first lien term loan and a
Caa1 (LGD5, 89%) rating to its proposed $130 million second lien
term loan. The first and second lien term loans will be jointly
issued by Winebow Holdings, Inc. and The Vintner Group, Inc. The
outlook is stable. Proceeds from the issuance will be used to
refinance existing debt of both companies, pay a shareholder
dividend, pay estimated transaction expenses and add about $4
million cash to the balance sheet.
Ratings Rationale
"The Winebow Group's B2 Corporate Family Rating ("CFR") reflects
Moody's expectation that the combined company will have a solid
position as a U.S. distributor of fine wine, a role that affords
it relatively low risk and significant stability of results due to
the unique three tier U.S. regulatory structure for alcoholic
beverage sales" said Linda Montag, a Moody's Senior Vice
President. "It is well positioned to benefit from attractive
industry characteristics including ongoing premiumization and
growth in U.S. wine consumption. Pro-forma for the combination,
the rating also reflects Moody's expectation that The Winebow
Group will have positive, stable free cash flow, good liquidity
and EBITA margins that are strong for a wine & spirits
distribution company", she added. These positive features are
offset by the new company's high financial leverage (debt to
EBITDA), relatively modest scale, limited geographic footprint and
aggressive financial policy evidenced by high leverage, ongoing
acquisitions, and large shareholder distributions as part of the
transaction. Moody's notes that the combination of Winebow and
Vintner will pose certain integration challenges but considers
this risk to be relatively low, and views the combination as a
positive for operating performance in the long-run.
The stable outlook reflects Moody's expectation that The Winebow
Group will maintain good liquidity, and that its leverage (after
Moody's standard accounting adjustments) will decline to around
six times over the next 12-18 months. Moody's outlook also
reflects its expectation that The Winebow Group will continue to
experience stable operating performance following the merger and
will benefit from the ongoing premiumization and solid performance
of the wine industry.
An upgrade could occur following evidence of successful
integration of the two businesses, if The Winebow Group
demonstrates continued organic revenue and profit growth,
maintains stable or improving operating margins, and de-levers
such that FCF to debt exceeds 5%, debt to EBITDA approaches the
mid five times range and EBITDA to interest approaches 3.0 times.
A downgrade could occur if operating performance weakens,
including top line pressure or sustained lower EBITDA margins , if
leverage rises such that debt to EBITDA approaches 7 times,
liquidity weakens or free cash flow is negative. Furthermore,
additional debt financed dividends or large acquisitions could put
downward pressure on the ratings.
The following ratings were assigned:
The Winebow Group
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
The outlook is stable
Winebow Holdings, Inc / The Vintner Group, Inc.
First Lien Term Loan at B1 (LGD3, 42%)
Second Lien Term Loan at Caa1 (LGD5, 89%)
The ratings are subject to final documentation and incorporate the
expectation that the term loans will be guaranteed by The Winebow
Group and by the company's wholly owned, domestic subsidiaries.
The principal methodology used in this rating was Global Retail
Industry published in June 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.
The Winebow Group, LLC is a newly formed company that is a
combination of Winebow, Inc. ("Winebow") and The Vintner Group
("Vintner"), two leading importers and distributors of fine wines
and craft spirits. The Winebow Group will be jointly owned by
Brazos Partners and Brockway Moran, their previous equity
sponsors. Headquartered in Richmond, Virginia, Winebow's pro-forma
annual revenue is just under $600 million.
WINEBOW GROUP: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' corporate credit
rating to U.S.-based The Winebow Group LLC. The outlook is
stable.
At the same time, S&P assigned a 'B' issue rating to the $230
million first-lien loan due 2021. The recovery rating is '3',
which indicates S&P's expectation for meaningful (50%-70%)
recovery for first-lien creditors in the event of a default.
Concurrently, S&P assigned its 'CCC+' issue rating to the $130
million second-lien loan due 2021. The recovery rating is '6',
which indicates S&P's expectation for negligible (0%-10%) recovery
for second-lien creditors in the event of a default.
"The ratings on TWG reflect our assessment of the company's very
aggressive financial policy, given the large debt-financed
dividend and the significant debt burden of the merger between
Winebow and The Vintner Group," said Standard & Poor's credit
analyst Rodney Olivero. "Pro forma for the transaction, we expect
leverage to be very high at about 8.0x. We believe credit
protection measures will remain weak for at least the next two
years, but will improve modestly as the company increases EBITDA
though operating leverage and synergies from the merged companies.
In addition, we expect TWG to use its low, but consistent, free
cash flow to reduce debt slightly."
Standard & Poor's assesses TWG's financial risk as "highly
leveraged" given its weak credit metrics. The ratings also
reflect S&P's belief the company has a "weak" business risk
profile because of its low market share in the highly fragmented
wine distribution industry, its narrow business focus, and its low
barriers to entry in non-franchise states.
The stable outlook reflects consistent U.S. wine market dynamics,
with government regulation providing insulation from current and
potential market participants in franchised states. S&P expects
the company's operating performance to remain relatively stable
over the next year, with revenue growth in the mid-single digits,
exceeding overall growth in wine sales in the U.S. and benefiting
from merger synergies. It also reflects S&P's forecast for low
but consistent free cash flow levels and credit ratios consistent
with a "highly leveraged" financial risk profile, including
leverage in the high-7x area.
WITHOUT WALLS: Mega Church Foreclosure Auction on July 8
--------------------------------------------------------
Tranzon Driggers will conduct a bankruptcy auction of Without
Walls Central Church in North Lakeland, Fla., which is owned by
Tampa-based Without Walls International Church, Inc. on July 8,
2014. According to a notice from Tranzon, sealed bids are due
July 7 at 3:00 p.m. ET and the best and final auction will be held
July 8 at 10:00 am ET.
Without Walls International Church filed for Chapter 11 bankruptcy
protection (Bankr. M.D. Fla. Case No. 14-02567) on March 5, owing
$29 million to the Evangelical Christian Credit Union in Brea,
Calif. Judge Michael G. Williamson presides over the case. In
its bankruptcy petition, the church estimated $10 million to $50
million in liabilities and assets.
Michelle A. Samaad, writing for Credit Union Times, reported that
the church received a loan from Evangelical Christian in 2008.
Without Walls International defaulted on the loan prior to the
bankruptcy filing. The report said Without Walls International
initially went into foreclosure with Evangelical Christian in
2008. In 2009, the credit union approved a mortgage modification
for the church. In October 2012, Without Walls International
filed a complaint against Evangelical Christian seeking more than
$23.8 million with claims that the credit union acted
inappropriately towards the church's founder, Randy White, by
allowing his ex-wife, Paula White, to take more than $2 million
worth of video and music equipment from the church to use for her
own ministry. Paula White was hired as a senior pastor at another
Florida church. Without Walls International had previously said
Evangelical Christian allegedly made false statements about the
church to thwart a deal initiated by Randy White to sell the
property.
The report added that the U.S. Bankruptcy Court denied the credit
union's Dec. 31, 2013 request to move forward on a foreclosure
case that began in October 2012.
Without Walls International is represented by:
Elena P. Ketchum, Esq.
STICHTER, RIEDEL, BLAIN & PROSSER
110 E. Madison St., Suite 200
Tampa, FL 33602
Tel: 813-229-0144
Fax: 813-229-1811
E-mail: eketchum.ecf@srbp.com
WORLD TRIATHLON: Moody's Assigns 'B2' Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service has assigned a B2 Corporate Family
Rating (CFR) and B2-PD Probability of Default Rating (PDR) to
World Triathlon Corporation ("WTC" or "the company"). Moody's has
also assigned B2 (LGD3-49%) ratings to the company's proposed $240
million senior secured 1st lien credit facilities which consist of
a $220 million term loan due 2021 and a $20 million revolver due
2019. The proceeds from the new term loan will be used to pay a
$220 million dividend to the company's equity sponsors. The
ratings are contingent upon Moody's review of final documentation
and no material change in the terms and conditions of the debt as
advised to Moody's. The outlook is stable.
Assignments:
Issuer: World Triathlon Corporation
Probability of Default Rating, Assigned B2-PD
Corporate Family Rating, Assigned B2
Senior Secured Bank Credit Facility, Assigned B2 (LGD3, 49 %)
Senior Secured Bank Credit Facility, Assigned B2 (LGD3, 49 %)
Outlook, Assigned as Stable
Ratings Rationale
WTC's B2 CFR reflects its highly predictable and recurring
revenue, strong brand loyalty and good free cash flow generation
due to its minimal capital requirements. Moody's also expects WTC
to benefit from the positive industry trend of higher
participation rates in triathlon races as it expands by offering
additional events around the world. These strengths are offset by
the company's small scale, low margins, its narrow business focus,
lack of tangible assets, reputation risks and high leverage from
an aggressive financial policy reflected by the dividend recap.
WTC has experienced strong revenue growth over the past several
years by introducing new IRONMAN races to additional locations
around the world. IRONMAN races continue to experience strong
demand , fueled by a higher rate of participation in triathlons
globally. The IRONMAN brand is the most valuable aspect of the
company and its strong following and high level of awareness, even
amongst non-participants, allows WTC to successfully market and
sell out many of its races well in advance of the event date.
Additionally, due to the high level of brand awareness, Moody's
believes that it would be extremely difficult to displace WTC from
its current leading position the world of endurance triathlon.
Pro forma for the transaction Moody's expects the company to
maintain moderate leverage going forward in the 4x to 5x
Debt/EBITDA range(Moody's adjusted).. However given the company's
low capital intensity, Moody's expects free cash flow will be over
10% of debt each year over the next several years.
Moody's expects WTC to have very good liquidity over the next
twelve months supported by approximately $14 million of cash on
the balance sheet and an undrawn $20 million revolving credit
facility following the close of the transaction. Moody's expects
the company to generate ample free cash flow over the next two to
three years. The term loans are expected to have no financial
covenants while the revolver will have a springing total leverage
test which Moody's expects to be set with at least 30% cushion.
The ratings for the debt instruments reflect both the probability
of default of WTC, to which Moody's assigns a PDR of B2-PD, and
individual loss given default assessments. The senior secured
credit facilities are rated B2 (LGD-3, 49%), in line with the CFR,
given that the credit facilities comprise the majority of debt in
the capital structure.
The stable outlook reflects Moody's view that WTC will continue to
experience strong revenue growth and generate positive free cash
flow of over 10% of debt.
Moody's could upgrade the ratings if WTC maintains very good
liquidity, continues to generate strong free cash flow and grows
EBITDA or reduces debt such that leverage is sustained below 4x
(Moody's adjusted). Moody's could lower WTC's ratings if leverage
is sustained above 5x (Moody's adjusted) for an extended period of
time or if free cash flow turns negative.
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.
World Triathlon Corporation owns, operates and licenses triathlon
events under the IRONMAN brand. The company was established in
1978 and now hosts over 250 events worldwide, including over 100
half and full IRONMAN competitions. WTC is owned by Providence
Equity Partners.
* Recent Small-Dollar & Individual Chapter 11 Filings
-----------------------------------------------------
In re Douglas W. Fitts, Sr.
Bankr. D. Mass. Case No. 14-12481
Chapter 11 Petition filed May 28, 2014
In re Black Lotus, Inc.
Bankr. E.D.N.C. Case No. 14-03035
Chapter 11 Petition filed May 28, 2014
See http://bankrupt.com/misc/nceb14-03035.pdf
represented by: Perry Mastromichalis, Esq.
E-mail: mastrolaw@aol.com
In re Global Metal Products, Inc.
Bankr. W.D. Pa. Case No. 14-10636
Chapter 11 Petition filed May 28, 2014
See http://bankrupt.com/misc/flsb14-10636.pdf
represented by: Daniel P. Foster
FOSTER LAW OFFICES
E-mail: dan@mrdebtbuster.com
In re George H. Picken, Jr.
Bankr. W.D. Tex. Case No. 14-51375
Chapter 11 Petition filed May 28, 2014
In re Atlantic Mechanical Services, LLC
Bankr. D. Conn. Case No. 14-21042
Chapter 11 Petition filed May 29, 2014
See http://bankrupt.com/misc/ctb14-21042.pdf
represented by: Joseph J. D'Agostino, Jr., Esq.
LAW OFFICES OF JOSEPH J. D'AGOSTINO, JR.
E-mail: joseph@lawjjd.com
In re Curtis F. Bailey
Bankr. D. Mass. Case No. 14-12524
Chapter 11 Petition filed May 29, 2014
In re Daniel F. Whirlow
Bankr. W.D. Pa. Case No. 14-22173
Chapter 11 Petition filed May 29, 2014
In re Dennis Edwin Smith
Bankr. N.D. Fla. Case No. 14-40323
Chapter 11 Petition filed May 30, 2014
In re Ronald J. Reed
Bankr. W.D. Tenn. Case No. 14-11400
Chapter 11 Petition filed June 4, 2014
In re Louis Solomon Weltman
Bankr. N.D. Fla. Case No. 14-40331
Chapter 11 Petition filed June 5, 2014
In re Lawn Munchers and Snow Removal Service, LLC
Bankr. M.D. Pa. Case No. 14-02672
Chapter 11 Petition filed June 5, 2014
See http://bankrupt.com/misc/pamb14-02672.pdf
represented by: Lawrence G. Frank, Esq.
LAW OFFICE OF LAWRENCE G. FRANK
E-mail: lawrencegfrank@gmail.com
In re D&M Plumbing & Heating Co., Inc.
Bankr. E.D. Wis. Case No. 14-27276
Chapter 11 Petition filed June 6, 2014
See http://bankrupt.com/misc/wieb14-27276.pdf
represented by: Paul G. Swanson, Esq.
STEINHILBER, SWANSON, MARES, MARONE &
MCDERMOTT
E-mail: pswanson@oshkoshlawyers.com
In re Crisoforo Cortes-Gamboa and Maricela Cortes
Bankr. M.D. Fla. Case No. 14-06659
Chapter 11 Petition filed June 9, 2014
In re Deborah Coates Koons
Bankr. M.D. Fla. Case No. 14-06699
Chapter 11 Petition filed June 9, 2014
In re Vincent J. Pizzi
Bankr. D. Mass. Case No. 14-12766
Chapter 11 Petition filed June 9, 2014
In re Roland D. Hughes
Bankr. D. Mass. Case No. 14-12773
Chapter 11 Petition filed June 9, 2014
In re RC Heating & Air Conditioning, Inc.
Bankr. D.N.J. Case No. 14-21876
Chapter 11 Petition filed June 9, 2014
See http://bankrupt.com/misc/njb14-21876.pdf
represented by: Robert Braverman, Esq.
LAW OFFICE OF ROBERT BRAVERMAN, LLC
E-mail: robert@bravermanlaw.com
In re Suchada Katatikarn
Bankr. E.D.N.Y. Case No. 14-72670
Chapter 11 Petition filed June 9, 2014
In re Terry Eugene Slate and Lynn Skipper Slate
Bankr. E.D.N.C. Case No. 14-03302
Chapter 11 Petition filed June 9, 2014
In re Phoenix Remediation, LLC
Bankr. S.D. Ohio Case No. 14-12437
Chapter 11 Petition filed June 9, 2014
See http://bankrupt.com/misc/ohsb14-12437.pdf
represented by: Glenda Ann Smith-Johnston, Esq.
GLENDA A. SMITH, ATTORNEY AT LAW, LLC
E-mail: gasmithlaw@yahoo.com
In re Century Arms Townhomes, LLC
Bankr. W.D. Pa. Case No. 14-22349
Chapter 11 Petition filed June 9, 2014
See http://bankrupt.com/misc/pawb14-22349.pdf
represented by: Michael Kaminski, Esq.
BLUMLING & GUSKY, LLP
E-mail: mkaminski@bglaw-llp.com
In re Gerry D. Dickens
Bankr. S.D. Tex. Case No. 14-33263
Chapter 11 Petition filed June 9, 2014
See http://bankrupt.com/misc/txsb14-33263.pdf
Filed Pro Se
In re Robert Lee Alderman and Noni Elizabeth Alderman
Bankr. N.D. Cal. Case No. 14-12922
Chapter 11 Petition filed June 10, 2014
In re Randall Lipsett
Bankr. D. Colo. Case No. 14-18056
Chapter 11 Petition filed June 10, 2014
In re William Glover, III, DMD, LLC
Bankr. M.D. Fla. Case No. 14-06797
Chapter 11 Petition filed June 10, 2014
See http://bankrupt.com/misc/flmb14-06797.pdf
represented by: Oscar Gonzalez, Jr., Esq.
LAW OFFICES OF OSCAR GONZALEZ JR.
E-mail: crimbklaw@yahoo.com
In re Earl Bernard Britt, Sr.
Bankr. N.D. Fla. Case No. bk-40336
Chapter 11 Petition filed June 10, 2014
In re API Signs, LLC
Bankr. N.D. Ill. Case No. 14-21635
Chapter 11 Petition filed June 10, 2014
See http://bankrupt.com/misc/ilnb14-21635.pdf
represented by: Ben L Schneider, Esq.
SCHNEIDER & STONE
E-mail: ben@windycitylawgroup.com
In re Manuel A. Noya
Bankr. D. Md. Case No. 14-19417
Chapter 11 Petition filed June 10, 2014
In re Pampered Foot Care, LLC
Bankr. S.D.N.Y. Case No. 14-11772
Chapter 11 Petition filed June 10, 2014
See http://bankrupt.com/misc/nysb14-11772.pdf
represented by: Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN P.C.
E-mail: alla@kachanlaw.com
In re East Coast Tees, LLC
Bankr. S.D. W.Va. Case No. 14-20300
Chapter 11 Petition filed June 10, 2014
See http://bankrupt.com/misc/wvsb14-20300.pdf
represented by: Mitchell Lee Klein, Esq.
KLEIN LAW OFFICE
E-mail: swhittington@kleinandsheridan.com
In re Lisa Lavalette
Bankr. D. Ariz. Case No. 14-09043
Chapter 11 Petition filed June 11, 2014
In re Charlene Renee Valencia and Jose Samuel Valencia
Bankr. N.D. Cal. Case No. 14-10877
Chapter 11 Petition filed June 11, 2014
In re Adriana R. Salem-Sakal
Bankr. S.D. Fla. Case No. 14-23433
Chapter 11 Petition filed June 11, 2014
In re Community Home Healthcare, Inc.
Bankr. E.D. Mich. Case No. 14-49913
Chapter 11 Petition filed June 11, 2014
See http://bankrupt.com/misc/mieb14-49913.pdf
represented by: Ethan D. Dunn, Esq.
MAXWELL DUNN, P.L.C.
E-mail: bankruptcy@maxwelldunnlaw.com
In re JAP Consultants, LLC
Bankr. E.D. Mich. Case No. 14-49914
Chapter 11 Petition filed June 11, 2014
See http://bankrupt.com/misc/mieb14-49914.pdf
represented by: Ethan D. Dunn, Esq.
MAXWELL DUNN, P.L.C.
E-mail: bankruptcy@maxwelldunnlaw.com
In re Health Synergy Group, Inc.
Bankr. S.D. Fla. Case No. 14-23392
Chapter 11 Petition filed June 11, 2014
See http://bankrupt.com/misc/flsb14-23392.pdf
Filed Pro Se
In re Cablelinks, Inc.
Bankr. E.D. Pa. Case No. 14-14717
Chapter 11 Petition filed June 11, 2014
See http://bankrupt.com/misc/paeb14-14717.pdf
represented by: Dimitri L. Karapelou, Esq.
LAW OFFICES OF DIMITRI L. KARAPELOU, LLC
E-mail: dkarapelou@karapeloulaw.com
In re 2323 East Capitol, LLC
Bankr. E.D. Wis. Case No. 14-27482
Chapter 11 Petition filed June 11, 2014
See http://bankrupt.com/misc/wieb14-27482.pdf
represented by: John W. Menn, Esq.
STEINHILBER, SWANSON, MARES
E-mail: jmenn@oshkoshlawyers.com
In re Eco Lumens LLC, a Delaware Limited Liability Company
dba ECO EPAD, LLC
Bankr. C.D. Cal. Case No. 14-13714
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/cacb14-13714.pdf
Filed Pro Se
In re Christopher P. Cestaro
Bankr. D. Conn. Case No. 14-31131
Chapter 11 Petition filed June 12, 2014
In re Lac T. Hoilien
Bankr. D. Hawaii Case No. 14-00805
Chapter 11 Petition filed June 12, 2014
In re Bomhack Properties, LLC - 1415 Abbott Series
Bankr. N.D. Ill. Case No. 14-22116
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/ilnb14-22116.pdf
represented by: Paul M. Bach, Esq.
SULAIMAN LAW GROUP, LTD.
E-mail: ecfbach@gmail.com
In re Bomhack Properties, LLC - 1635 Maple Series
Bankr. N.D. Ill. Case No. 14-22117
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/ilnb14-22117.pdf
represented by: Paul M. Bach, Esq.
SULAIMAN LAW GROUP, LTD.
E-mail: ecfbach@gmail.com
In re Bomhack Properties, LLC - 85 South Crystal Series
Bankr. N.D. Ill. Case No. 14-22118
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/ilnb14-22118.pdf
represented by: Paul M. Bach, Esq.
SULAIMAN LAW GROUP, LTD.
E-mail: ecfbach@gmail.com
In re Stanley of New Orleans, LLC
Bankr. E.D. La. Case No. 14-11506
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/laeb14-11506.pdf
represented by: Christopher T. Caplinger, Esq.
LUGENBUHL, WHEATON, PECK, RANKIN & HUBBARD
E-mail: ccaplinger@lawla.com
In re The New World Labor Force, LLC
Bankr. E.D. La. Case No. 14-11509
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/laeb14-11509.pdf
represented by: Christopher T. Caplinger, Esq.
LUGENBUHL, WHEATON, PECK, RANKIN & HUBBARD
E-mail: ccaplinger@lawla.com
In re Scott Boswell Enterprises, LLC
Bankr. E.D. La. Case No. 14-11510
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/laeb14-11510.pdf
represented by: Christopher T. Caplinger, Esq.
LUGENBUHL, WHEATON, PECK, RANKIN & HUBBARD
E-mail: ccaplinger@lawla.com
In re Robert Dewayne Beller and Mary Lou Beller
Bankr. W.D. Mo. Case No. 14-60781
Chapter 11 Petition filed June 12, 2014
In re Robert Terc
Bankr. D.N.J. Case No. 14-22133
Chapter 11 Petition filed June 12, 2014
In re Nadia Moreb
Bankr. E.D.N.Y. Case No. 14-43003
Chapter 11 Petition filed June 12, 2014
In re Advanced Laundry Systems of N.Y., Inc.
dba Advanced Surveillance Systems
Bankr. E.D.N.Y. Case No. 14-43020
Chapter 11 Petition filed June 12, 2014
See http://bankrupt.com/misc/nyeb14-43020.pdf
represented by: Rachel Blumenfeld, Esq.
LAW OFFICE OF RACHEL S. BLUMENFELD
E-mail: rblmnf@aol.com
In re Dale Vernon Fincher
Bankr. W.D. Wash. Case No. 14-14561
Chapter 11 Petition filed June 12, 2014
In re Robert Stephen Oliver
Bankr. W.D. Ark. Case No. 14-71812
Chapter 11 Petition filed June 13, 2014
In re Michael T. Stoller
Bankr. C.D. Cal. Case No. 14-12971
Chapter 11 Petition filed June 13, 2014
In re Play Smart Surfacing, Inc.
Bankr. C.D. Cal. Case No. 14-17743
Chapter 11 Petition filed June 13, 2014
See http://bankrupt.com/misc/cacb14-17743.pdf
represented by: Thomas F. Nowland, Esq.
LAW OFFICES OF THOMAS F. NOWLAND
E-mail: tom@nowlandlaw.com
In re Linke Family Holdings Ltd.
Bankr. N.D.N.Y. Case No. 14-11329
Chapter 11 Petition filed June 13, 2014
See http://bankrupt.com/misc/nynb14-11329.pdf
represented by: James P. Lagios, Esq.
ISEMAN, CUNNINGHAM, RIESTER & HYDE, LLP
E-mail: jlagios@ICRH.com
In re Jorge Rodriguez
Bankr. C.D. Cal. Case No. 14-21624
Chapter 11 Petition filed June 14, 2014
In re Cetek Network Solutions, Inc.
Bankr. N.D. Ill. Case No. 14-22286
Chapter 11 Petition filed June 14, 2014
See http://bankrupt.com/misc/ilnb14-22286.pdf
represented by: Erica Crohn Minchella, Esq.
ERICA CROHN MINCHELLA, LTD.
E-mail: erica.minchella@gmail.com
In re Lewistown Health and Fitness Center, Inc.
Bankr. M.D. Pa. Case No. 14-02819
Chapter 11 Petition filed June 15, 2014
See http://bankrupt.com/misc/pamb14-02819.pdf
represented by: Lawrence G. Frank, Esq.
LAW OFFICE OF LAWRENCE G. FRANK
E-mail: lawrencegfrank@gmail.com
In re Hector Mier
Bankr. C.D. Cal. Case No. 14-12981
Chapter 11 Petition filed June 16, 2014
In re R.B. LLC
Bankr. C.D. Cal. Case No. 14-17797
Chapter 11 Petition filed June 16, 2014
See http://bankrupt.com/misc/cacb14-17797.pdf
represented by: Stephen R. Wade, Esq.
THE LAW OFFICES OF STEPHEN R. WADE
E-mail: srw@srwadelaw.com
In re Kathy Haylock
Bankr. C.D. Cal. Case No. 14-21687
Chapter 11 Petition filed June 16, 2014
In re Theresa R. Simmons
Bankr. E.D. Cal. Case No. 14-26304
Chapter 11 Petition filed June 16, 2014
In re Watergate Wine & Spirits Inc.
Bankr. D. D.C. Case No. 14-00352
Chapter 11 Petition filed June 16, 2014
See http://bankrupt.com/misc/dcb14-00352.pdf
represented by: David E. Lynn, Esq.
DAVID E. LYNN, P.C.
E-mail: davidlynn@verizon.net
In re Terry A. Beden
Bankr. M.D. Fla. Case No. 14-06980
Chapter 11 Petition filed June 16, 2014
In re Quicksilver Welding Services, Inc.
Bankr. N.D. Fla. Case No. 14-30660
Chapter 11 Petition filed June 16, 2014
See http://bankrupt.com/misc/flsb14-30660.pdf
represented by: Teresa M. Dorr, Esq.
ZALKIN REVELL, PLLC
E-mail: tdorr@zalkinrevell.com
In re Guilfort Dieuvil
Bankr. S.D. Fla. Case No. 14-23775
Chapter 11 Petition filed June 16, 2014
In re Reginald Anthony Jason Greene
Bankr. N.D. Ga. Case No. 14-61673
Chapter 11 Petition filed June 16, 2014
In re Contempo Industries, Inc.
dba Woodstock Gardens
Bankr. N.D. Ill. Case No. 14-81891
Chapter 11 Petition filed June 16, 2014
See http://bankrupt.com/misc/ilnb14-81891.pdf
represented by: Jason H. Rock, Esq.
BARRICK SWITZER LAW OFFICE
E-mail: jrock@bslbv.com
In re R&J Pizza
Bankr. E.D.N.Y. Case No. 14-43066
Chapter 11 Petition filed June 16, 2014
See http://bankrupt.com/misc/nyeb14-43066.pdf
represented by: Jennifer Lang Koo, Esq.
LAW OFFICE OF JENNIFER L. KOO
E-mail: jkoo@jkoolaw.com
In re Anthony Rivara
Bankr. E.D.N.Y. Case No. 14-72784
Chapter 11 Petition filed June 16, 2014
In re Four Ferry Road Realty Holding, LLC
Bankr. D. N.H. Case No. 14-11241
Chapter 11 Petition filed June 16, 2014
See http://bankrupt.com/misc/nhb14-11241.pdf
represented by: Robert L. O'Brien, Esq.
E-mail: roboecf@gmail.com
In re Tara C. Young
Bankr. M.D. Tenn. Case No. 14-04788
Chapter 11 Petition filed June 16, 2014
In re Howard Lee Young and Robbie Sue Young
Bankr. M.D. Tenn. Case No. 14-04790
Chapter 11 Petition filed June 16, 2014
In re Mark A. McKoy
Bankr. E.D. Va. Case No. 14-72214
Chapter 11 Petition filed June 16, 2014
In re C & C Enterprises, L.L.C.
Bankr. S.D. Ala. Case No. 14-01954
Chapter 11 Petition filed June 17, 2014
See http://bankrupt.com/misc/alsb14-01954.pdf
represented by: W. Lee Webb, Esq.
WILKINS, BANKESTER, BILES & WYNNE, PA
E-mail: lwebb@wbbwlaw.com
In re Peter G. Bernal
Bankr. D. Ariz. Case No. 14-09291
Chapter 11 Petition filed June 17, 2014
In re Steven D. Lach and Susan D. Lach
Bankr. C.D. Cal. Case No. 14-11285
Chapter 11 Petition filed June 17, 2014
In re Calexico Fitness Inc.
Bankr. S.D. Cal. Case No. 14-04801
Chapter 11 Petition filed June 17, 2014
See http://bankrupt.com/misc/casb14-04801.pdf
represented by: Pedro S. Bonilla, Esq.
BONILLA LAW OFFICES
E-mail: bonillaw@sbcglobal.net
In re Carlos Robert Romero
Bankr. S.D. Fla. Case No.
Chapter 11 Petition filed June 17, 2014
In re 1121 N. 3rd Street, Inc.
Bankr. M.D. Fla. Case No. 14-02949
Chapter 11 Petition filed June 17, 2014
See http://bankrupt.com/misc/flmb14-02949.pdf
represented by: Bradley R. Markey, Esq.
THAMES MARKEY & HEEKIN, P.A.
E-mail: brm@tmhlaw.net
In re Oreo Chasseur, LLC
Bankr. M.D. Fla. Case No. 14-07014
Chapter 11 Petition filed June 17, 2014
See http://bankrupt.com/misc/flmb14-07014.pdf
represented by: Evelyn Pabon Figueroa, Esq.
CPLS, P.A.
E-mail: epabonfigueroa@cplspa.com
In re Robert S. Dokken, Jr.
Bankr. N.D. Fla. Case No. 14-50203
Chapter 11 Petition filed June 17, 2014
In re Aphrodite Gourdouros Johns
Bankr. D. Md. Case No. 14-19654
Chapter 11 Petition filed June 17, 2014
In re Gerald Yeboah Omari
Bankr. D. Md. Case No. 14-19725
Chapter 11 Petition filed June 17, 2014
In re Beacon Behavioral Health Services, LLC
Bankr. D.N.J. Case No. 14-22439
Chapter 11 Petition filed June 17, 2014
represented by: Telissa K. Lindsey, Esq.
In re 613 Warren Avenue LLC, Debtor
Bankr. D.N.J. Case No. 14-22460
Chapter 11 Petition filed June 17, 2014
See http://bankrupt.com/misc/njb14-22460.pdf
represented by: David M. Meth, Esq.
OFFICE OF DAVID M. METH, ESQ.
E-mail: david@methnjlaw.com
In re Howard S. Grufferman
Bankr. S.D.N.Y. Case No. 14-11815
Chapter 11 Petition filed June 17, 2014
In re Feliciano Gonzalez Construction, Inc.
Bankr. D.P.R. Case No. 14-04931
Chapter 11 Petition filed June 17, 2014
See http://bankrupt.com/misc/prb14-04931.pdf
Filed Pro Se
In re Denisse J Rodriguez Martinez
Bankr. D.P.R. Case No. 14-04946
Chapter 11 Petition filed June 17, 2014
*********
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 ***