/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/140812.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, August 12, 2014, Vol. 18, No. 223 Headlines 710 LONG RIDGE: 2nd Circ. Won't Hear Appeal of Contempt Order ACOSTA HOLDCO: Moody's Assigns 'B2' Corporate Family Rating ADVANCED READY: Creditors Ask Court to Dismiss Case AECOM TECHNOLOGY: S&P Assigns Prelim. 'BB' CCR; Outlook Stable AFFORDABLE GRANITE: Case Summary & 20 Top Unsecured Creditors ALABAMA MARBLE: Fight With Landlord Over Quarry Lease Continues ALLIANT TECHSYSTEMS: Moody's Assigns 'Ba1' Rating on $150MM Loan ALLISON TRANSMISSION: Fitch Affirms 'BB-' Issuer Default Rating AMERICAN CUMO: Court Adjourns Hearing to Appoint Receiver-Manager AMERICAN INT'L: Posts Rise in Profit, Settles Crisis-Era Suit ATLAS IT: Court Limits Appeals of Denial of Automatic Stay Relief AVIS BUDGET: DBRS Assigns BB(low) Issuer Rating on Q2 Results AZIZ CONVENIENCE: Has Interim Authority to Use Cash Collateral AZIZ CONVENIENCE: Section 341(a) Meeting Scheduled for Sept. 16 BERNARD L. MADOFF: Deals Can Sidestep Trustee's Roadblock CAESARS ENTERTAINMENT: Deals $2.6B Loss on Path to Restructuring CATALENT PHARMA: S&P Hikes CCR to BB-, Removed From Watch Pos. CELANESE CORP: Moody's Raises Corp. Family Rating to 'Ba1' CHIQUITA BRANDS: Gets $625 Million Buyout Offer From Brazilians CITYCENTER HOLDINGS: S&P Raises CCR to 'B+' on Debt Repayment CLIFFS NATURAL: Moody's Lowers Sr. Unsecured Debt Rating to Ba1 COLDWATER CREEK: Plan Confirmation Hearing Moved to Sept. 17 COLDWATER CREEK: Seeks Extension of Exclusive Periods COLDWATER CREEK: Lease Decision Deadline Extended Until Oct. 31 COLOR STAR GROWERS: Gets Approval of Deal With Lenders, Committee CONEX HOLDINGS: Court Narrows Trustee's Suit Over 2008 LBO CONNEAUT LAKE PARK: Trustees Seek Bankruptcy Lawyer's Advice CONNECTEDU INC: Gates Foundation Seeks Docs Over Grant Funds CRUMBS BAKE SHOP: Customer Data Needs Shield, Watchdog Says CRYSTAL CATHEDRAL: 9th Circ. Axes Founder's $5M Comp Claim CUE & LOPEZ: Court Extends Oriental Bank's Reply Deadline DETROIT, MI: Amended Terms of Agreement with Police Assoc. OK'd DETROIT, MI: Federal Court Agrees to Suspend Bankruptcy Appeals DETROIT, MI: City Mayor Addresses Water Shut-Off Program DEWEY & LEBOEUF: Judge Stays Insurer's Case Against Defendants DIGITAL DOMAIN: Fla. Says $20M in Tax Credits Not Part of Estate DOTS LLC: Bounces Back as New Owner Re-opens Some Stores ELBIT IMAGING: Provides Add'l Update to Annual Meeting Proposal ENERGY FUTURE: Solvency Ruled Discoverable in Make-Whole Fight ENERGY FUTURE: Drops Bid to Take Part in Optim Asset Auction ENERGY FUTURE: Given Six-Month Extension to Remove Suits ENGLOBAL CORP: Posts $1.6 Million Net Income in Second Quarter ENTEGRA POWER: Plan & Disclosure Statement Hearing on Sept. 19 ENTEGRA POWER: Has Authority to Hire Prime Clerk as Claims Agent ENTEGRA POWER: Has Interim Authority to Use Cash Collateral ENTERTAINMENT PUBLICATIONS: Saves Big With Mich. Tax Agreement EVANS & SUTHERLAND: Incurs $868,000 Net Loss in Second Quarter EVERGREEN TANK: S&P Lowers CCR to 'B-' on Weak Credit Metrics FIRST MARINER: Has Exclusive Right to File Plan Until Sept. 3 GRIDWAY ENERGY: Ask Court for 60-Day Exclusive Periods Extension GUAM POWER: Fitch Affirms 'BB+' Rating on $27.3MM Sub. Rev. Bonds GUAM POWER: Moody's Affirms Ba1 Rating on Sub. Revenue Bonds HAAS ENVIRONMENTAL: Files Reorganization Plan, Faces Objections HOSTESS BRANDS: Notifies Court of Address Change HOUSTON REGIONAL: AT&T, DirecTV to Acquire CSN Houston Under Plan IMPERIAL METALS: S&P Cuts Rating to 'CCC+' Over Tailings Breach INTERNATIONAL MANUFACTURING: Can Use Cash Collateral Thru Oct. 24 JOHN D. OIL: Allowed to Pay $6-Mil. to RBS Citizens Until Aug. 14 KID BRANDS: Reaches Accord with Creditors Over $49M DIP Loan LEHMAN BROTHERS: Arbitrators Ease Blame on Auditors LEHR CONSTRUCTION: Trustee Resolves Dispute With Coffeys LIGHTSQUARED INC: Fights GPS Makers' Bid to Toss Contract Suit LYONDELL CHEMICAL: Shareholders Try to Ax $12.5B Clawback Row MARRIOTT VACATIONS: S&P Raises CCR to 'BB'; Outlook Stable MCCLATCHY CO: Reports Second Quarter Revenue of $292 Million MEDIA GENERAL: New $75MM Add-on Loan No Impact on Moody's B1 CFR MEDIA GENERAL: S&P Retains 'BB-' Rating Over $75MM Loan Add-On MEDICAL REHAB: Case Summary & 20 Largest Unsecured Creditors MEGA RV: Gets Approval to Hire Goe & Forsythe as Legal Counsel MEGA RV: Gets Approval to Hire GlassRatner as Financial Adviser MEGA RV: Judge Lifts Stay, Allows Ally to Dispose of Vehicles MICRO HOLDING: S&P Gives 'B' Corp. Credit Rating; Outlook Stable MONITOR COMPANY: Ch. 7 Estate Seeks $6M In Slew Of Clawback Suits MONROE HOSPITAL: Case Summary & 30 Largest Unsecured Creditors MOSS FAMILY: Can Use Fifth Third's Cash Collateral Until Sept. 30 MSI CORP: Sept. 2 Hearing on Approval of Disclosure Statement MUNDY RANCH: Judge Confirms Plan of Reorganization NE OPCO: Pre-Closing Claims Against Cenveo Barred NOVO POINT: High Court Asked To Clarify Power Of Receivership OTELCO INC: Reports Net Income of $1.3 Mil. in Second Quarter OCZ TECHNOLOGY: Confirms Chapter 11 Plan of Liquidation OPPENHEIMER HOLDINGS: S&P Affirms 'B' Counterparty Credit Rating OPTIM ENERGY: Taps Blackstone Unit As $126M Buyer For Coal Plant PACIFIC STEEL: Gets Approval to Reject Lease With Berkeley PACIFIC STEEL: Goes to Stalking Horse Speyside for $11.3MM PALM DRIVE HEALTH: Oct. 8 Deadline for Creditors to File Claims PETRON ENERGY: Amends Q2 Form 10-Q to Revise Disclosure REVEL AC: US Trustee Wants Fox Rothschild Off Ch. 11 RYNARD PROPERTIES: Fannie Mae Wants Operating Reports Submitted SAGE PRODUCTS: S&P Raises First-Lien Debt Rating to 'B+' SGK VENTURES: US Trustee Removes Terrapin Metals as Panel Member SMART MOTION: Case Summary & 20 Largest Unsecured Creditors SOLITRON DEVICES: Bankr. Court Can't Block Contribution Suit SOMERSET HILLS SCHOOL: Status Conference Set for Sept. 30 SPIRIT LIFE CHURCH: Case Summary & 5 Unsecured Creditors SPRINGLEAF HOLDINGS: S&P Hikes ICR to 'B' on Legacy Assets Sale STARWOOD HOTELS: Moody's Assigns (P)Ba1 Preferred Stock Rating T-L BRYWOOD: August 20 Hearing on Interim Use of Cash Collateral TERVITA CORP: S&P Affirms 'B-' Corp. Credit Rating TIN CROSS VINEYARDS: Case Summary & Largest Unsecured Creditors TRIPLANET PARTNERS: Taps Stamell & Schager as Litigation Counsel TRULAND GROUP: Sued for Wages after Mass Firings UPH HOLDINGS: Officially Exited Chapter 11 Protection July 1 VYCOR MEDICAL: Boosts Shareholder Equity by $2.4 Million YELLOWSTONE MOUNTAIN: Founder Fights Contempt At 9th Circ. YONKER INVESTMENTS: Case Summary & 7 Unsecured Creditors * 9th Circ. Backs Judges' Power To Ban Bankruptcy Advisers * Bill Would Let "Medically Distressed" Cast Off Student Loans * July 2014 Chapter 11 Filings Fall 34% From Last Year * After FDIC D&O Battles, Redrawing Exclusion No Easy Task * Consumer Spending in U.S. Rose in June by Most in Three Months * Credit Rating Suit Against S&P, Others Goes To State Court * Debt Collectors under Fire by Regulator * Fed, FDIC Boards Blast Big Banks' 'Living Wills' * Hirings Up, Federal Reserve May Raise Interest Rates * U.S. Starts Civil Inquiry of Subprime Car Lending * Capital Restructure Provides Financing to Chapter 11 Company * Troutman Sanders Adds Bankruptcy Group in New York * Large Companies With Insolvent Balance Sheet ********* 710 LONG RIDGE: 2nd Circ. Won't Hear Appeal of Contempt Order ------------------------------------------------------------- Law360 reported that the U.S. Court of Appeals for the Second Circuit has refused to take up a health care center management company's appeal of an order that it flouted an injunction to reinstate pay and benefits to aggrieved workers, saying that multiple appeals, including one in bankruptcy court, should be heard first. According to the report, in a summary order, a three-judge panel put off ruling on whether HealthBridge Management LLC, which managed five long-term health care centers in Connecticut, violated a December 2012 injunction granted to the National Labor Relations Board. As previously reported by The Troubled Company Reporter, U.S. Bankruptcy Judge Donald H. Steckroth denied the request of the NLRB, which seeks clarification of the Court's Opinion dated March 5, 2014 and Order dated March 6, 2014 confirming the First Amended Joint Plan of Reorganization of HealthBridge. Judge Steckroth said he has no jurisdiction over the matter since the NLRB has taken an appeal from the Confirmation Order to the New Jersey District Court. Both the NLRB and the New England Health Care Employees Union, District 1199, S.E.I.U., have challenged the Plan's confirmation and the approval of third-party releases and injunction in the Plan. The NLRB requests that the Confirmation Order be "clarified" to indicate that nothing in the Plan or the Court's Confirmation Order will operate to prevent the NLRB from continuing its administrative case against Care One Realty, LLC, Care One LLC, and Healthbridge Management, LLC, in order to find them to be a single integrated enterprise and/or joint employer with the Debtors, nor shall the Confirmation Order operate to prevent the NLRB from obtaining prospective injunctive relief. About 710 Long Ridge Road Operating Company II 710 Long Ridge Road Operating Company II, LLC and four affiliates own sub-acute and long-term nursing care facilities for the elderly in Connecticut. The facilities, which are managed by HealthBridge Management LLC, are Long Ridge of Stamford, Newington Health Care Center, Westport Health Care Center, West River Health Care Center, and Danbury Health Care Center. 710 Long Ridge Road Operating Company II and its affiliates sought Chapter 11 protection (Bankr. D.N.J. Case Nos. 13-13653 to 13- 13657) on Feb. 24, 2013, to modify their collective bargaining agreements with the New England Health Care Employees Union, District 1199, SEIU. The Debtors owe $18.9 million to M&T Bank and $7.99 million on loans from the U.S. Department of Housing and Urban Development Federal Housing Administration. Michael D. Sirota, Esq., Gerald Gline, Esq., David Bass, Esq., and Ryan T. Jareck, Esq., serve as counsel to the Debtors. Logan & Company, Inc. is the claims and notice agent. Alvarez & Marsal Healthcare Industry Group, LLC, is the financial advisor. Porzio, Bromberg & Newman, P.C.'s Robert M. Schechter, Esq., and Rachel Segall, Esq., represents the Official Committee of Unsecured Creditors. The Committee retained EisnerAmper LLP as accountant. Levy Ratner's Suzanne Hepner, Esq., and Ryan J. Barbur, Esq., represent the New England Health Care Workers, District 1199 SEIU. Abby Propis Simms, Esq., Julie L. Kaufman, Esq., Nancy E. Kessler Platt, Esq., Dawn L. Goldstein, Esq., Paul Thomas, Esq., and John McGrath, Esq., at the National Labor Relations Board Special Litigation Branch in Washington, D.C., argue for the National Labor Relations Board. On March 6, 2014, Judge Steckroth entered a findings of fact, conclusions of law and order confirming 710 Long Ridge Road Operating Company II, LLC, et al.'s First Amended Joint Chapter 11 Plan of Reorganization. In accordance with the Plan, the Debtors have declared March 7, 2014, as the Effective Date of the Plan. A full-text copy of Judge Steckroth's March 6 Order is available for free at http://bankrupt.com/misc/710LONGRIDGEplanmemo0306.pdf The Plan provides for the combination of concessions and a cash infusion of approximately $67 million from affiliated entities, and was accepted by the overwhelming majority of the Centers' creditors. Under the Plan, the Centers' creditors are entitled to a recovery of up to 75 percent on their claims and there will be no disruption in operations or services. The bankruptcy plan pertains only to the five unionized Connecticut Centers and does not apply to the other health care centers managed by HealthBridge Management, LLC. Each of the five centers is a sub-acute and long-term nursing care facility for the elderly in Connecticut. The facilities are: Long Ridge of Stamford, Newington Health Care Center, Westport Health Care Center, West River Health Care Center, and Danbury Health Care Center. ACOSTA HOLDCO: Moody's Assigns 'B2' Corporate Family Rating ----------------------------------------------------------- Moody's Investors Service assigned a B2 Corporate Family Rating ("CFR") and a B2-PD Probability of Default Rating to Acosta Holdco, Inc., as well as B1 ratings to the company's proposed first lien senior secured facilities. The nearly $3.0 billion of debt proceeds, supplemented by $1.84 billion of cash equity contributed by The Carlyle Group, will be used to effect Carlyle's acquisition of Acosta. (The company intends to issue subordinated debt as well, but Moody's has not yet rated these securities.) The ratings outlook is negative. Upon the acquisition's closing, which is expected late in the third quarter of 2014, Moody's will withdraw existing ratings at Acosta, Inc., the current borrower of roughly $2.2 billion of senior secured and mezzanine debt. The following ratings were assigned: Issuer: Acosta Holdco, Inc. Probability of Default Rating, Assigned B2-PD Corporate Family Rating, Assigned B2 Senior Secured Bank Credit Facility, Assigned B1, LGD3 Ratings Rationale The B2 Corporate Family Rating reflects Acosta's very high pro- forma opening leverage of well above 8.0 times (including Moody's standard adjustments, including the capitalization of operating leases) as a result of the purchase of the sales and marketing agency ("SMA") by another private equity owner. While Moody's recognize that the company has shown the ability to delever when in the hands of past owners, this deal's incremental leverage could constrain Acosta's competitiveness. However, Moody's also recognize that the company has grown steadily, both organically and through acquisitions, over the past several years, including through the most recent recession, positioning it as the largest SMA in an industry characterized by a near-duopolistic structure, significant barriers to entry, good customer retention, and exceptionally steady demand for the underlying consumer packaged goods, whose sales SMAs facilitate. Moody's factors Acosta's operating margins and its high debt-to- EBITDA financial leverage relative to its B2-rated peers in Moody's CFR. Moody's expect that the company, primarily though profit growth (as opposed to debt paydown), will reduce leverage to under 8.0 times, or by a full turn, by the end of fiscal 2015. The measure is comparable to that of Acosta's primary competitor, Advantage Sales and Marketing, which is also weakly positioned in the B2 category. Moody's believe financial leverage could threaten Acosta's ability to take advantage of opportunistic acquisitions or to devote resources to integrate the recently acquired Anderson Daymon Worldwide ("ADW") operations. However, Moody's also recognizes Acosta's good free cash flow generation capability -- Moody's expect at least $100 million, annually, in upcoming years -- and its dominance as the country's largest SMA, a position which bolsters the business's inherent customer stickiness. Moody's expects that Acosta, as demonstrated by prior acquisition successes with experiential-marketing company Mosaic and the approximately two dozen foodservice acquisitions it has made over the past few years, can, with ADW's contribution as well, raise its EBITDA margins by about two hundred basis points. Rating Outlook The negative outlook indicates that Acosta, post the Carlyle acquisition, faces elevated risks, given the strictures posed by higher leverage as the company executes expansion plans and integrates acquisitions. Moody's continues to expect that Acosta will grow revenues in the mid- to high-single-digit percentages, and that its EBITDA margin, boosted by the purchase of ADW, whose margins are considerably stronger than Acosta's, will steadily improve, approximately to levels realized before the Mosaic and foodservice acquisitions. The ADW acquisition, moreover, should bolster Acosta's top line, as ADW's sales growth, which typically mimics Costco's, outpaces Acosta's legacy operations' growth. There is, nevertheless, little room within the current rating to accommodate an even modest level of underperformance relative to Moody's expectations. What Could Change the Rating - UP The ratings could be upgraded if Acosta can boost its EBITDA margin closer to historical levels on a sustained basis, and use free cash to prepay debt obligations such that debt-to-EBITDA can be brought down and be sustained at about 5.0 times. An upgrade would also require a demonstrated commitment to conservative financial policies with regard to dividends and acquisitions. What Could Change the Rating - DOWN Moody's could downgrade the ratings if Acosta fails to delever as anticipated over the next twelve to 18 months, if liquidity deteriorates, or if the company stumbles in its integration of ADW. Lower-than-anticipated margin improvements, or revenues failing to grow at historical averages, could also pressure the rating down. A sustained debt-to-EBITDA measure at or above 7.5 times would put downward pressure on the ratings. ADVANCED READY: Creditors Ask Court to Dismiss Case --------------------------------------------------- Holcim (US) Inc. and Lehigh Cement Company LLC ask the Bankruptcy Court to dismiss the involuntary Chapter 11 case of Advanced Ready Mix Corp. pursuant to Section 1112(b)(1) of the Bankruptcy Code. Lehigh and Holcim point out Advanced Ready Mix's failure to comply with numerous obligations the Bankruptcy Code. On March 28, 2013, the Local 282 Welfare Trust Fund, the Local 282 Pension Trust Fund, the Local 282 Annuity Trust Fund, and the Local 282 Job Training Trust Fund filed the involuntary Chapter 11 petition against Advanced Ready Mix. Several other creditors joined in the petition. David R. Hock, Esq., at Cohen, Weiss and Simon LLP, in New York, relates that the petitioning trust funds and Advanced Ready Mix have been engaged in settlement discussions. They may join Lehigh and Holcim's request to dismiss the case if an agreement is reached before the hearing on this matter. Lehigh and Holcim are represented by: Wanda Borges, Esq. Cristina Lipan, Esq. BORGES & ASSOCIATES, LLC 575 Underhill Blvd., Suite 118 Syosset, NY 11791 Tel: (516) 677-8200 x225 Fax: (516) 677-0806 E-mail: wborges@borgeslawllc.com clipan@borgeslawllc.com The petitioning trust funds are represented by: David R. Hock, Esq. COHEN, WEISS AND SIMON LLP 330 West 42nd Street New York, NY 10036-6976 Tel: 212-563-4100 Fax: 212-695-5436 About Advanced Ready Mix On March 28, 2013, an involuntary petition for relief (Bankr. E.D.N.Y. Case No. 13-41795) was filed against Advanced Ready Mix Corp. by Local 282 Welfare Trust Fund, Local 282 Pension Trust Fund, Local 282 Annuity Trust Fund and Local 282 Job Training Trust Fund pursuant to section 303 of the Bankruptcy Code. On April 22, 2013, the Debtor submitted its Answer to Involuntary Petition in which it contested Local 282's standing as petitioning creditors. On April 26, 2013, Tilcon New York Inc. joined in the involuntary petition pursuant to Section 303(c) of the Bankruptcy Code. Tilcon is a judgment creditor of the Debtor, holding a judgment in the amount of $287,500 against the Debtor and Rocco Manzione arising out of a state court breach of contract action. From its inception, the Debtor operated its ready mix concrete manufacturing business from a property located at 239 Ingraham Street, Brooklyn, New York and the contiguous lot located at 610 Johnson Street. AECOM TECHNOLOGY: S&P Assigns Prelim. 'BB' CCR; Outlook Stable -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its preliminary 'BB' corporate credit rating to Los Angeles-based engineering and construction (E&C) company AECOM Technology Corp. The outlook is stable. At the same time, S&P assigned its preliminary 'BB+' issue rating and '2' recovery rating to the company's proposed senior secured credit facilities. The '2' recovery rating indicates S&P's expectation for substantial recovery (70%-90%) in a payment default scenario. The proposed senior secured credit facilities will include a $1.050 billion revolver, a $1.288 billion term loan A, a $500 million performance letter of credit facility, and a $1.825 billion term loan B. At the same time, S&P assigned its preliminary 'BB-' issue rating and '5' recovery rating to the company's proposed senior unsecured notes. The '5' recovery rating indicates S&P's expectation for modest recovery (10%-30%) in a payment default scenario. The company will use the debt proceeds to partly finance its acquisition of URS Corp. S&P expects to assign final ratings after the transaction closes and it receives the final terms for the proposed unsecured notes issuance. S&P's 'BB' preliminary corporate credit rating on AECOM reflects the company's participation in the volatile and competitive E&C industry. S&P expects pro forma debt leverage of about 4.5x as of the fiscal year ending September 2014. The company will have good scale and diversity, pro forma for the acquisition of URS Corp., as a provider of engineering, construction, professional technical and management support services for public and private clients globally. Pro forma for the acquisition, the company will also have good geographic diversification across North America. But revenues will be concentrated (at about 77%) in the U.S. and Canada, while Europe, the Middle East, and Africa will account for 14% and Asia-Pacific the remaining 9%. "The stable outlook reflects our view that the company will successfully integrate the URS Corp. acquisition along with our expectations for good near-term operating prospects buoyed by the combined company's large backlog," said Standard & Poor's credit analyst Robyn Shapiro. "We believe that these factors will keep leverage well below 5x and allow the company free cash flow to debt of 5% or more." S&P could raise the rating during the next 12 months if, as a result of good operating performance and debt reduction from free cash flow, S&P expects adjusted debt leverage below 4x and free cash flow to debt above 10% on a sustained basis. Although unexpected, S&P could lower the rating during the next 12 months if AECOM's operating performance weakens and it appears that debt to EBITDA would rise above 5x on a sustained basis or that FOCF to debt will fall to less than 5%. Although not anticipated at this time, this could occur if, for example, the integration does not proceed as planned or if the company experiences large cost overruns in several of its larger contracts. AFFORDABLE GRANITE: Case Summary & 20 Top Unsecured Creditors ------------------------------------------------------------- Debtor: Affordable Granite & Cabinetry, Inc, as successor through merger to Affordable Granite & Stone, Inc. dba Midwest Marble Restoration & Maintenance, Inc. 416 11th Ave S Hopkins, MN 55343 Case No.: 14-43291 Chapter 11 Petition Date: August 8, 2014 Court: United States Bankruptcy Court District of Minnesota (Minneapolis) Judge: Hon. Katherine A. Constantine Debtor's Counsel: Thomas H Olive, Esq. THOMAS H. OLIVE LAW, P.A. 5270 W 84th St Suite 300 Bloomington, MN 55437 Tel: 952-831-0733 Email: tolive@oto-law.com Total Assets: $717,108 Total Liabilities: $1.52 million The petition was signed by Dean Soltis, authorized individual. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/mnb14-43291.pdf ALABAMA MARBLE: Fight With Landlord Over Quarry Lease Continues --------------------------------------------------------------- Bankruptcy Judge James J. Robinson refereed a court fight between Alabama Marble Co., Inc., and its newly-arrived, successor landlord, TBGS Quarry, LLC. Their fight is over who has the right to operate a marble quarry located in Talladega County, Alabama, near the town of Sylacauga. TBGS claims the Debtor's leasehold interest in the quarry, including the Debtor's right to extract marble, was terminated before the Debtor sought chapter 11 relief. TBGS wants the Debtor out of the quarry so TBGS can mine marble for its own use. However, the Debtor wants to remain in possession, and asserts that the quarry lease it negotiated over 15 years ago with its original landlord remains in full force and effect. Indeed, over the objection of TBGS, the Debtor proposes to assume the Lease, although it has not yet proposed a plan of reorganization. The Lease is indispensable if the debtor has any chance to reorganize. TBGS filed a Motion to Confirm Relief From Stay in which it sought an order confirming that the automatic stay imposed under Sec. 362(a) of the Bankruptcy Code was not applicable to TBGS's efforts to obtain possession of the marble quarry. A few days after filing the Stay Relief Motion, TBGS filed an alternative motion in which it asked the Court, pursuant to Sec. 365(d)(2), to order the Debtor to reject the Lease in the event the Court found the Lease had not been terminated prepetition. The Debtor conceded it was appropriate for the Lease to be either assumed or rejected, and asked the Court to set a deadline for the same, suggesting April 11, 2014, which has long since come and gone. A few days later, the Debtor filed a motion in which the Debtor sought an order authorizing it to assume the Lease. Judge Robinson ruled that: (a) TBGS's Stay Relief Motion is denied; (b) TBGS's Rejection Motion and the Debtor's Motion to Assume are continued, and will be heard at the same time the Debtor's disclosure statement is set for a hearing on its approval pursuant to clause (1) of Rule 2002(b) of the Federal Rules of Bankruptcy Procedure; and (c) The Debtor's Response to Rejection Motion is moot and, therefore, denied. A copy of the Court's Aug. 8 Opinion and Order is available at http://is.gd/Fe8S6Ffrom Leagle.com. Alabama Marble Co., Inc., based in Sylacauga, Alabama, filed for Chapter 11 bankruptcy (Bankr. N.D. Ala. Case No. 14-40157) on Feb. 7, 2014. Judge James J. Robinson oversees the case. Jennifer Brooke Kimble, Esq., and Scott R. Williams, Esq., at Rumberger, Kirk & Caldwell, P.C., serves as the Debtor's counsel. In its petition, the Debtor estimated $1 million to $10 million in both assets and liabilities. The petition was signed by Stephen Musolino, president. ALLIANT TECHSYSTEMS: Moody's Assigns 'Ba1' Rating on $150MM Loan ---------------------------------------------------------------- Moody's Investors Service has assigned a Ba1 rating to Alliant Techsystems Inc.'s ("ATK") $150 million term loan due 2019. Proceeds of the term loan, along with cash on hand, helped fund the tender offer on ATK's $196 million 3% convertible senior subordinated notes due 2024 that closed on June 27th. Following the tender transaction, $12.8 million of the convertible notes remained outstanding and ATK has commenced an offer to repurchase those notes. ATK has indicated that on August 20th it will call in any notes for redemption that do not participate in the repurchase offer. Ratings assigned: $150 million Incremental Term Loan Facility due 2019, Ba1, LGD2 Ratings affirmed: Corporate Family, Ba2 Probability of Default, Ba2-PD Speculative Grade Liquidity, SGL-3 $700 million Revolving Credit Facility due 2018, Ba1, LGD2 $1010 million Term Loan A due 2018, Ba1, LGD2 $250 million Term Loan B due 2020, Ba1, LGD2 $300 million Senior Notes due 2021, Ba3, LGD5 from Ba3, LGD4 $350 million Senior Subordinated Notes due 2020, B1, LGD6 from B1, LGD5 $12.8 million Convertible Senior Subordinated Notes due 2024, B1, LGD5 (to be withdrawn when debt has been fully repaid) Rating Outlook: Continued at Stable Ratings Rationale The Ba2 CFR recognizes ATK's good revenue diversity, scale and returns for the rating level against the company's recent acquisitions within its Sporting Goods segment. Acquisitions have resulted in brief periods of high financial leverage for the rating and they raise integration risk considerations. The stable outlook recognizes the company's history of good cash flow generation. The pending merger with Orbital Sciences Corporation (Ba1 CFR), expected to close by the end of 2014, should result in a consolidated financial risk profile that is substantially similar to that ATK's at present. The Ba1 rating on the incremental term loan, one notch above the CFR, reflects the secured bank facility's relatively large size and effectively senior position within the capital structure. Upward rating momentum would depend on debt/EBITDA sustained closer to 3x, EBITA/interest above 4x, good liquidity and FCF/debt consistently above 10%. Downward rating pressure would mount with debt/EBITDA above 4x, EBITA/interest under 3x, or if FCF/debt were to fall below 5% of total debt. Headquartered in Arlington, Virginia, Alliant Techsystems Inc. produces propulsion, composite structures, munitions, rocket motor systems, precision missiles, and civil, military and sport ammunition, outdoor accessories and sports optics. The company is organized in three segments: Defense Group (about 35% of FY2014 revenue), Sporting Group (39%), and Aerospace (26%). Over the last twelve months ended June 29, 2014 annual revenues were approximately $4.9 billion. The principal methodology used in this rating was 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. ALLISON TRANSMISSION: Fitch Affirms 'BB-' Issuer Default Rating --------------------------------------------------------------- Fitch Ratings has affirmed the Issuer Default Ratings for Allison Transmission Holdings, Inc. (ALSN) and its subsidiary Allison Transmission, Inc. (ATI) at 'BB-'. In addition, Fitch has affirmed the 'BB' ratings on ATI's secured term loans and secured revolving credit facility, and the 'B+' rating on ATI's senior unsecured notes. Fitch's ratings apply to $2.2 billion in secured term loans, a $465 million secured revolving credit facility and $471 million in senior unsecured notes. The Rating Outlooks for ALSN and ATI have been revised to Positive from Stable. Key Rating Drivers The ratings for ALSN and ATI are supported by the company's strong competitive position in the global market for fully automatic transmissions for commercial, industrial and military vehicles and equipment. ALSN has a very strong market position in North America, with nearly all school buses and the majority of Type A motorhomes and medium-duty commercial trucks manufactured with the company's transmissions in 2013. In addition, over half of the Class 8 straight trucks sold in North America in 2013 were manufactured with the company's transmissions, and unlike most Tier 1 suppliers, ALSN's brand name commands a price premium from end users. However, ALSN's market position outside North America is significantly smaller, as commercial vehicles in most global markets continue to be produced with manual transmissions. Nonetheless, global acceptance of fully automatic transmissions is growing, particularly for certain vocations, such as buses and emergency vehicles. This has been particularly true in emerging markets such as China and India, where ALSN is well-positioned for future growth opportunities. The revision of the Outlook to Positive from Stable reflects Fitch's expectation that ALSN's credit profile will continue to strengthen over the intermediate term. Fitch expects leverage to trend down as the company focuses on its targeted net leverage range, and Fitch expects the global diversification of the company's revenue stream to rise as its penetration into emerging markets increases. ALSN's premium pricing and relatively low manufacturing costs have led to consistently strong profitability and free cash flow (FCF) generation, which will continue to provide the company with significant financial flexibility going forward and a meaningful liquidity cushion in the event of an unexpected downturn. Although ALSN's leverage remains high for the rating category, the company has applied a portion of its strong FCF over the past several years to debt reduction, including a $140 million decline in the last 12 months (LTM) ended June 30, 2014, and leverage is expected to trend down further over the intermediate term as the company focuses on its net leverage target range (net debt/adjusted EBITDA, as calculated by the company) of 3x-3.5x. Modest pension obligations, a strong liquidity position and manageable near-term debt service requirements are other credit positives. Fitch also notes that ALSN's ownership structure has become less concentrated over the past year as The Carlyle Group (Carlyle) and Onex Corporation (Onex) have reduced their combined ownership stake in the company to only 3%, down from 81% at June 30, 2013, through a series of secondary stock offerings. Fitch's concerns include the heavy cyclicality of the global commercial vehicle and industrial markets, volatile raw material costs, relatively little global diversification of ALSN's current business, moderately high leverage and a concentrated maturity schedule. However, on the last point, Fitch notes that credit facility amendments over the past two years have shifted all of ALSN's term loan obligations to 2017 and 2019, removing the company's near-term refinancing risk. The company's strong profitability and FCF generation place it in relatively good position to manage the cyclical volatility noted above, and it is also notable that ALSN's transmissions are primarily used in the vocational truck market, which tends to be less cyclical than the Class 8 linehaul market, which remains dominated by manual transmissions. Nevertheless, a broad-based global downturn in commercial vehicle and industrial production could pressure ASLN's profitability and FCF. ALSN's credit profile is characterized by strong margins and FCF generation but relatively high leverage. Fitch-calculated leverage (debt/Fitch-calculated EBITDA) at June 30, 2014, was 4x, with $2.7 billion in debt and LTM Fitch-calculated EBITDA of $667 million. The Fitch-calculated EBITDA margin, at 33.6%, remained very strong for a capital goods manufacturer and was up from 30.2% in the LTM ended June 30, 2012. Fitch expects leverage to trend down over the remainder of 2014 through a combination of EBITDA growth and debt reduction. With strong FCF generation and most of its debt in the form of term loans, ALSN has the financial flexibility to reduce leverage further in the intermediate term if it chooses to do so, although it is likely to be near the high end of its net leverage target range by year-end 2014. The company's liquidity position at June 30, 2014 was more than sufficient to meet its near-term cash obligations and included $127 million in cash and cash equivalents, augmented by $453 million in availability on its $465 million secured revolving credit facility (after accounting for $12 million in letters of credit). Over the past year, Carlyle and Onex significantly reduced their collective stake in ALSN through four secondary stock offerings, one in the third quarter of 2013 (3Q'13) and three in the 1H'14. As a result of these sales, Carlyle and Onex reduced their combined stake in ALSN to 3% as of June 30, 2014, down from 81% at June 30, 2013. Although Fitch did not previously view the concentrated ownership structure as a significant credit risk, it is nonetheless a mild credit positive that the company's ownership base has become more diversified. However, Fitch expects the company will begin to focus more heavily on returning cash to shareholders through dividends and share repurchases now that its shareholder composition is less concentrated. ALSN has been focused on reducing debt over the past several years, with debt (including short-term debt) declining from $4 billion at year-end 2008 to $2.7 billion at June 30, 2014. The figure at June 30, 2014 was down $140 million from the level at June 30, 2013, as the company prepaid a portion of its term loans in the latter half of 2013. ALSN has flexibility to further reduce its debt through optional prepayments on its secured term loans. ATI's 7.125% senior unsecured notes also have a soft call provision that allows for early redemption of all or a portion of the notes beginning in May 2015. Fitch expects that the company may look for opportunities to further prepay a portion of its debt over the intermediate term as it continues to work toward its 3x- 3.5x net leverage target. Fitch expects FCF to remain solid over the intermediate term and FCF margins to remain strong by industry standards. LTM FCF was $353 million at June 30, 2014, leading to a strong 17.8% FCF margin. Funds flow from operations (FFO) was $528 million in the LTM period, with working capital using a modest $17 million in cash. LTM capital spending was $71 million, equal to only 3.6% of revenue. The company has guided to full-year 2014 capital spending in the range $60 million to $70 million, and with no significant plant construction activity expected over the intermediate term, capital spending needs are likely to remain relatively low over the next several years. ALSN instituted a common dividend in 2012 and spent $87 million on dividends in the LTM period ended June 30, 2014, which is included in Fitch's FCF calculation. Now that the company's sponsors have sold most of their stake in the company, Fitch expects ALSN to target more cash toward share repurchases as well. In the LTM period ended June 30, 2014, ALSN spent $349 million on share repurchases, all of which were conducted in conjunction with the secondary offerings of the sponsors' stakes. ALSN's secured revolving credit facility agreement includes a financial covenant that requires the company to maintain a senior secured leverage ratio below 5.5x. However, with the most recent amendment to the facility, the revolver participants have permanently waived the covenant as long as no borrowings are outstanding at any quarter-end. Despite the waiver, ALSN's actual senior secured leverage ratio, which is calculated net of cash, was well below the limit, at 3.11x as of June 30, 2014. According to the facility's terms, a senior secured leverage ratio at or below 3.5x suspends certain provisions requiring excess cash flow (as defined in the agreement) to be applied to term loan reduction. Even without the waiver, Fitch would not expect the senior secured leverage ratio covenant to constrain the company or lead to any credit risk over the intermediate term. ALSN's pension obligations are modest, with an overfunded status of $2.7 million as of year-end 2013. The company's U.S. hourly pension plan was closed to new entrants in 2008, and benefits for U.S. hourly employees who retired prior to Oct. 2, 2011 are covered under General Motors Company's (GM) hourly plan. Fitch does not view ALSN's pension obligations as a meaningful credit risk. The secured revolver and term loans that comprise ATI's credit facility are rated 'BB', one notch above ATI's IDR, due to their collateral coverage, which includes virtually all of ATI's assets. Fitch notes that property, plant, and equipment and intangible assets (including intellectual property) comprised $2.1 billion of the $4.8 billion in assets on ALSN's consolidated balance sheet at June 30, 2014. With the secured credit facility accounting for nearly 83% of the debt in ALSN's consolidated capital structure (assuming a fully-drawn revolver), ATI's senior unsecured notes are rated one notch below ATI's IDR at 'B+'. Rating Sensitivities Positive: Future developments that may, individually or collectively, lead to a positive rating action include: -- A decline in Fitch-calculated EBITDA leverage to below 3.5x; -- An increase in the global diversification of its revenue base; -- Maintaining EBITDA and FCF margins near current levels; -- Continued positive FCF generation in a weakened demand environment. Negative: Future developments that may, individually or collectively, lead to a negative rating action include: -- A sharp decline in commercial vehicle production, especially in North America that leads to significantly lower margins and FCF; -- An increase in leverage to above 4.5x for a prolonged period; -- A merger or acquisition that results in higher leverage or lower margins over an extended period; -- A competitive entry into the market that results in a significant market share loss. Fitch has affirmed the following ratings and revised the Rating Outlooks to Positive from Stable: Allison Transmission Holdings, Inc. -- IDR at 'BB-'. Allison Transmission, Inc. -- IDR at 'BB-'; -- Senior secured revolving credit facility at 'BB'; -- Senior secured term loan B-2 at 'BB'; -- Senior secured term loan B-3 at 'BB'; -- Senior unsecured notes at 'B+'. AMERICAN CUMO: Court Adjourns Hearing to Appoint Receiver-Manager ----------------------------------------------------------------- American CuMo Mining Corporation disclosed that on Friday, August 1, 2014, at the request of legal counsel for International Energy & Mineral Resources Investment (Hong Kong) Company Limited, the British Columbia Supreme Court Judge adjourned the hearing to appoint a receiver-manager for CuMoCo. Legal counsel for IEMR HK applied for an adjournment following the filing by the Company of affidavits that presented substantial evidence that contradicted the affidavits presented on behalf of IEMR HK by Mrs. Fu, the wife of Hongxue Fu, ex-chairman, expresident, and currently a director of the Company and the controlling person of IEMR HK and by Charles Yuen, ex vice?president and currently a director of the Company. Legal counsel for IEMR HK requested the adjournment in order to obtain an affidavit from Hongxue Fu himself, who is currently in China. The Company will continue to defend itself from this lawsuit that IEMR HK filed the same day the voting results were revealed at the shareholder-requisitioned general meeting of shareholders held on July 22, 2014. As a result of Mr. Thomas Conway being elected as an additional director of the Company and subsequent motions passed by the new Board of Directors, CuMoCo is proceeding forward with the business of the Company and entering into discussions with various groups to arrange necessary financing to fund the activities of the Company and to remove the debentures that are being used by IEMR HK in an attempt to appoint a receiver. The Company is also investigating possible merger and joint venture opportunities to move the CuMo Project forward. About American CuMo Mining Corporation American CuMo Mining Corporation, formerly Mosquito Consolidated Gold Mines Limited, is a Canada-based company engaged in exploration and development of mineral right interests. AMERICAN INT'L: Posts Rise in Profit, Settles Crisis-Era Suit ------------------------------------------------------------- Leslie Scism, writing for The Wall Street Journal, reported that American International Group has posted a 13% jump in second- quarter profit, aided by solid results in its core operations and a gain from the last of a series of divestitures prompted by its 2008 government bailout. According to the report, in after-hours trading on Aug. 11 when the results were posted, AIG's shares rose 2.1%, to $53.76. About AIG With corporate headquarters in New York, American International Group, Inc., is an international insurance company, serving customers in more than 130 countries. AIG companies serve commercial, institutional and individual customers through property-casualty networks of any insurer. In addition, AIG companies are providers of life insurance and retirement services. At the height of the 2008 financial crisis, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. AIG almost collapsed under the weight of bad bets it made insuring mortgage-backed securities. The Company, however, was bailed out by the Federal Reserve, but even after an initial infusion of $85 billion, losses continued to grow. The later rescue packages brought the total to $182 billion, making it the biggest federal bailout in U.S. history. AIG sold off a number of its businesses and other assets to pay down loans received from the U.S. government. ATLAS IT: Court Limits Appeals of Denial of Automatic Stay Relief ----------------------------------------------------------------- Law360 reported that the First Circuit has refused to rule that all orders denying stay relief in bankruptcy litigation are final and appealable regardless of circumstances, finding it lacks jurisdiction to hear a dispute between two information technology companies it described as "bare-knuckle brawlers." According to the report, the dispute centers on a disputed contract to set up a joint venture in Puerto Rico between now- bankrupt Atlas IT Export Corp. and Pinpoint IT Services LLC to provide project-based and remote staffing opportunities. After the deal went sour, the two companies filed dueling suits in Puerto Rico and Virginia, but Atlas soon filed for Chapter 7 and the district court actions were stayed, the report related. The Chapter 7 trustee for Atlas managed to get the stay lifted in the Puerto Rico action, while Pinpoint failed to get the stay lifted in Virginia and appealed the matter to the First Circuit's Bankruptcy Appellate Panel, the report further related. The case is Pinpoint IT Services LLC v. Atlas IT Export Corp., case number 13-9003, in the U.S. Court of Appeals for the First Circuit. August 4, 2014 AVIS BUDGET: DBRS Assigns BB(low) Issuer Rating on Q2 Results ------------------------------------------------------------- DBRS Inc. views Avis Budget Group, Inc.'s 2Q14 financial results as solid with good revenue growth and operating costs well- managed, while fleet costs normalized. The high level of vehicle recalls created an operational headwind for the Company resulting in lower utilization, missed opportunities to dispose of fleet during the seasonally strong spring used vehicle market, and higher employee maintenance costs reflecting overtime by staff to address the recall issues and return the vehicles to the active fleet. Despite this operational challenge, Avis Budget reported sound results, with adjusted EBITDA 19% higher YoY to $213 million. DBRS sees the financial results as demonstrating the benefits of the Company's prior acquisitions, as well as the continuing progress on executing on its strategic initiatives to grow volumes from more profitable channels while realizing early benefits of technology investments. Company-wide rental volumes were up 6% YoY due to accelerating growth in North American and modest growth internationally. North American volumes improved 8% YoY with 3% due to incremental volumes from the Payless acquisition, and 5% of organic growth in Avis and Budget. Growth in Avis and Budget were primarily driven by the Company's focus on more profitable channels as well as by the Company's successful efforts to shift volumes from opaque websites to proprietary websites. Strengthening consumer confidence as well as business sentiment also underpinned the expanding volumes in North America. Overall, International segment volumes were up 2% YoY. In Europe, volume growth was mixed reflecting the uneven economic recovery within the region. Weak economic growth in Australia, the Company's largest market in Asia Pacific, resulted in subdued volume growth in the region. However, DBRS notes that the Company's Apex brand continues to report significant volume growth as the deep-value discount brand expands into markets outside of New Zealand. Total revenues were 10% higher YoY at $2.2 billion with net revenues improved across both North American and International Car Rental segments, while Truck revenues were modestly lower primarily due to a 12% reduction in the fleet. Importantly, North American pricing was up 4% YoY, the sixth consecutive quarter of price increases demonstrating that the Company's efforts to drive pricing higher is sticking. Also of importance, DBRS notes that the improvement in North American pricing was broad based across both brands, on and off-airport markets and in both commercial and leisure travel. DBRS views the trends in pricing as demonstrating the strength of the Avis Budget franchise and evidence of the early benefits of the Company's new yield management system. As a result, DBRS-calculated revenue per unit per month improved to $1,353, a 2.5% improvement from the comparable period a year ago. As expected, fleet costs continue to normalize as used vehicle residual values moderate. On a per month per unit basis, North American fleet costs were slightly higher YoY at $306. Avis Budget continues to execute on strategies designed to mitigate the impact of lower residual values including expanding the utilization of alternative disposition channels and cascading fleet to Payless from the Avis and Budget fleets. Finally, over the past year, Avis Budget has implemented a new fleet optimization system, which affords management the ability to take greater advantage of seasonal patterns in the used vehicle market as well as adjust the fleet mix on a local market level to meet shifts in demand patterns. DBRS rates Avis Budget Group, Inc.'s Issuer Rating at BB (low) with a Stable trend. AZIZ CONVENIENCE: Has Interim Authority to Use Cash Collateral -------------------------------------------------------------- Judge Richard S. Schmidt of the U.S. Bankruptcy Court for the Southern District of Texas, McAllen Division, approved a stipulation between Aziz Convenience, L.L.C., and PlainsCapital Bank agreeing that the Debtor has interim authority to use cash collateral securing its indebtedness from PCB. PCB asserts valid, first-priority, and unavoidable liens and security interests in all of the Debtor's assets to secure payment of approximately $27.5 million. As adequate protection for the Debtor's use of cash collateral, PCB is granted from and after the Petition Date, valid and automatically perfected first-priority replacement liens and security interests in all of the Debtors' assets. The Debtor's ability to use the cash collateral will terminate upon the Debtor's default on the terms provided under the court- approved stipulation. The Debtor asked that it be given authority to use the cash collateral through Aug. 21. Aziz Convenience Stores, L.L.C., owner of convenience stores with gas pumps in Texas, filed a Chapter 11 bankruptcy petition (Bankr. S.D. Tex. Case No. 14-70427) in its hometown in McAllen, Texas, on Aug. 4, 2014, without stating a reason. The Debtor owns properties in Mission, San Juan, Pharr, McAllen, Sullivan City, Edinburg, La Joya, Donna, Alamo, Alton, Edinburg, all in Texas. It appears that none of the Debtor's convenience stores are on leased property as the schedule of unexpired leases only shows the contract with Valero LP. The Debtor is represented by William A Csabi, Esq., from Harlingen, Texas. For his legal services, Mr. Csabi agreed to accept $65,000 from the Debtor, with the $12,500 already paid prepetition. AZIZ CONVENIENCE: Section 341(a) Meeting Scheduled for Sept. 16 --------------------------------------------------------------- A meeting of creditors in the bankruptcy case of Aziz Convenience Stores, L.L.C., will be held on Sept. 16, 2014, at 11:00 a.m. in Harlingen, 222 E Van Buren. Proofs of Claims are due by Dec. 15, 2014. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This meeting of creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Aziz Convenience Stores, L.L.C., filed a Chapter 11 bankruptcy petition (Bankr. S.D. Tex. Case No. 14-70427) in its hometown in McAllen, Texas, on Aug. 4, 2014. Dagoberto G. Trevino signed the petition as manager. The Debtor disclosed total assets of $19.1 million and total liabilities of $35.1 million. William A Csabi, attorney at law, serves as the Debtor's counsel. BERNARD L. MADOFF: Deals Can Sidestep Trustee's Roadblock --------------------------------------------------------------- Joe Palazzolo, writing for The Wall Street Journal, reported that the U.S. Court of Appeals for the Second Circuit has rejected the arguments raised by court-appointed trustee handling the bankruptcy of Bernard L. Madoff's firm that bankruptcy law precludes other settlements from being processed until he has finished finding and redistributing funds from the Ponzi scheme. According to the report, the ruling came after trustee Irving Picard sought to block the settlement between New York Attorney General Eric Schneiderman's office and J. Ezra Merkin, who invested more than $2 billion with Madoff on behalf of hundreds of investors. The trustee has argued that the Attorney General's efforts were duplicative of, and damaging to, his own efforts to recover money for victims. The Second Circuit, in a three-judge panel, leaves intact a $410 million settlement with Merkin and an $80 million settlement with Fairfield Greenwich Ltd., Jonathan Stempel, writing for Reuters. Writing for the appeals court, Circuit Judge Robert Sack said Picard "is incapcable of establishing either that the settlements would in fact have an immediate adverse economic consequence for the BLMIS estate, or that the estate is likely to suffer irreparable harm," if the settlements go ahead, Reuters cited. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC and Bernard L. Madoff orchestrated the largest Ponzi scheme in history, with losses topping US$50 billion. On Dec. 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. The District Court's Protective Order (i) appointed Irving H. Picard, Esq., as trustee for the liquidation of BLMIS, (ii) appointed Baker & Hostetler LLP as his counsel, and (iii) removed the SIPA Liquidation proceeding to the Bankruptcy Court (Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.). Mr. Picard has retained AlixPartners LLP as claims agent. On April 13, 2009, former BLMIS clients filed an involuntary Chapter 7 bankruptcy petition against Bernard Madoff (Bankr. S.D.N.Y. 09-11893). The petitioning creditors -- Blumenthal & Associates Florida General Partnership, Martin Rappaport Charitable Remainder Unitrust, Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert US$64 million in claims against Mr. Madoff based on the balances contained in the last statements they got from BLMIS. On April 14, 2009, Grant Thornton UK LLP as receiver placed Madoff Securities International Limited in London under bankruptcy protection pursuant to Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. 09-16751). The Chapter 15 case was later transferred to Manhattan. In June 2009, Judge Lifland approved the consolidation of the Madoff SIPA proceedings and the bankruptcy case. Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors in United States v. Madoff, No. 09-CR-213 (S.D.N.Y.). From recoveries in lawsuits coupled with money advanced by SIPC, Mr. Picard has paid about 58 percent of customer claims totaling $17.3 billion. The most recent distribution was in March 2013. Mr. Picard has collected about $9.35 billion, not including an additional $2.2 billion that was forfeit to the government and likewise will go to customers. Picard is holding almost $4.4 billion he can't distribute on account of outstanding appeals and disputes. The largest holdback, almost $2.8 billion, results from disputed claims. CAESARS ENTERTAINMENT: Deals $2.6B Loss on Path to Restructuring ---------------------------------------------------------------- Christopher Palmeri and Laura J. Keller, writing for Bloomberg News, reported that Caesars Entertainment Corp., the casino company taken private in a $30.7 billion leveraged buyout just before the credit crisis, has taken steps that signal it's poised for a massive debt restructuring that will saddle creditors with steep losses. According to the report, Caesars, with properties from Caesars Palace in Las Vegas to Harrah's Atlantic City, has had only one profitable year since 2008 as it struggles to service $21 billion of long-term debt amid a drop in consumer spending. While owners of the company's $6.35 billion of higher-priority bonds may escape with limited losses, holders of the company's lower-ranking notes, including $5.2 billion of second-lien securities, are facing the likelihood of getting no more than 20 percent of the debt's face value and could recover nothing, the Bloomberg report said, citing Fitch Ratings. About Caesars Entertainment Caesars Entertainment Corp., formerly Harrah's Entertainment Inc. -- http://www.caesars.com/-- is one of the world's largest casino companies. Caesars casino resorts operate under the Caesars, Bally's, Flamingo, Grand Casinos, Hilton and Paris brand names. The Company has its corporate headquarters in Las Vegas. Harrah's announced its re-branding to Caesar's in mid-November 2010. Caesars Entertainment reported a net loss of $2.93 billion in 2013, as compared with a net loss of $1.50 billion in 2012. The Company's balance sheet at March 31, 2014, showed $24.37 billion in total assets, $26.65 billion in total liabilities and a $2.27 billion total deficit. * * * As reported by the TCR on April 9, 2013, Moody's Investors Service downgraded Caesars Entertainment Corporation's Corporate Family Rating to Caa2. "The downgrade of Caesars' ratings considers that its same store EBITDA growth in 2012-2013 has failed to materialize to any significant degree, and so Caesars' credit metrics have deteriorated and its free cash flow deficit will be higher than Moody's previous expectations," stated Moody's analyst Peggy Holloway. In the April 10, 2014, edition of the TCR, Standard & Poor's Ratings Services lowered its corporate credit ratings on Las Vegas-based Caesars Entertainment Corp. (CEC) and wholly owned subsidiaries, Caesars Entertainment Operating Co. (CEOC) and Caesars Entertainment Resort Properties (CERP), as well as the indirectly majority-owned Chester Downs and Marina, to 'CCC-' from 'CCC+'. The downgrade reflects S&P's expectation that Caesars' capital structure is unsustainable, and the amount of cash the company will burn in 2014 and 2015 creates conditions under which S&P believes a restructuring of some form is increasingly likely over the near term absent an unanticipated significantly favorable change in operating performance. As reported by the TCR on May 1, 2014, Fitch Ratings has downgraded the Issuer Default Ratings (IDRs) of Caesars Entertainment Corp (CEC) and Caesars Entertainment Operating Company (CEOC) to 'CC' from 'CCC'. In the Aug. 4, 2014, edition of the TCR, Fitch Ratings has upgraded Caesars Entertainment Operating Company. Inc.'s (CEOC) senior secured credit facility to 'CCC+/RR1' from 'CCC/RR2' following the finalization of the new guarantee and pledge agreement. The agreement caps the amount of debt that Caesars Entertainment Corp (CEC; Caesars, parent) may guarantee at $8.35 billion. CATALENT PHARMA: S&P Hikes CCR to BB-, Removed From Watch Pos. -------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Catalent Pharma Solutions to 'BB-' from 'B+' and removed it from CreditWatch, where S&P placed it with positive implications in July. The outlook is stable. "At the same time, we raised our issue-level rating on Catalent's senior secured credit facility to 'BB' from 'BB-', reflecting the raised corporate credit rating. The recovery rating on this debt remains '2', reflecting our expectation of substantial (70%-90%) recovery in the event of payment default. We also raised our rating on the company's unsecured term loan to 'BB-' from 'B' and revised our recovery rating on this debt to '4' from '5', reflecting our expectation for average (30%-50%) recovery in the event of default. We intend to withdraw our ratings on the company's senior unsecured and senior subordinated note issues, which have been called, when they are repaid over the next few weeks," S&P noted. "Our ratings actions follow the news that Catalent has completed its IPO, with about $750 million in proceeds used to repay debt. Pro forma the debt repayment, we expect leverage to decline to around 5x from around 7x. As a result, we are revising our financial risk profile to "aggressive" from "highly leveraged" and raising our corporate credit rating by one notch," said credit analyst Shannan Murphy. S&P's stable outlook reflects its expectation that modest EBITDA growth and lower interest expense under the new capital structure will allow Catalent to sustain leverage in the high-4x range and FFO/debt in at least the low-teens. It also incorporates S&P's belief that financial policies are likely to remain consistent with maintenance of leverage below 5x as a newly public company. Downside scenario S&P could lower the rating if it expects the company to operate with leverage meaningfully above 5x for an extended period of time. This could happen if the company undertakes acquisitions significantly beyond the level that can be financed through cash flow. This could also occur if pricing pressures result in meaningful margin deterioration. S&P believes margins would need to decline by more than 200 basis points from current levels to prompt a downgrade. Upside scenario S&P could raise the rating if Catalent reduces leverage to the low-4x range. Under this scenario, S&P would also need to be confident that the risk of releveraging was low, and that the company was committed to maintaining these lower leverage levels. CELANESE CORP: Moody's Raises Corp. Family Rating to 'Ba1' ---------------------------------------------------------- Moody's Investors Service raised the Corporate Family Rating (CFR) of Celanese Corporation to Ba1 from Ba2 due to its improving financial performance and credit metrics. Moody's also raised its ratings on Celanese U.S. Holdings LLC senior secured bank facility to Baa3 from Ba1. However Moody's affirmed the ratings on Celanese U.S. Holdings LLC senior unsecured debt at Ba2 and Celanese's Speculative Grade Liquidity Rating at SGL-1. The outlook is stable. "The upgrade was triggered by the improved financial performance at Celanese over the past year," stated John Rogers, Senior Vice President at Moody's. "While we expect financial performance to continue to improve, the rating will likely be capped at Ba1 until management provides financial targets for leverage that would support an investment grade rating and refinances the secured debt in its capital structure." Upgrades: Issuer: Celanese Corporation Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD Corporate Family Rating, Upgraded to Ba1 from Ba2 Issuer: Celanese U.S. Holdings LLC Senior Secured Bank Credit Facility Oct 31, 2015, Upgraded to Baa3, LGD2 from Ba1, LGD3 Senior Secured Bank Credit Facility Oct 31, 2016, Upgraded to Baa3, LGD2 from Ba1, LGD3 Senior Secured Bank Credit Facility Oct 31, 2016, Upgraded to Baa3, LGD2 from Ba1, LGD3 Outlook Actions: Issuer: Celanese Corporation Outlook, Changed To Stable From Positive Issuer: Celanese U.S. Holdings LLC Outlook, Changed To Stable From Positive Affirmations: Issuer: Celanese Corporation Speculative Grade Liquidity Rating, Affirmed SGL-1 Issuer: Celanese U.S. Holdings LLC Senior Unsecured Regular Bond/Debenture Jun 15, 2021, Affirmed Ba2, LGD4 Senior Unsecured Regular Bond/Debenture Oct 15, 2018, Affirmed Ba2, LGD4 Senior Unsecured Regular Bond/Debenture Nov 15, 2022, Affirmed Ba2, LGD4 Ratings Rationale The upgrade of the CFR to Ba1 reflects the improvement of Celanese's financial performance and credit metrics over the past year. As of June 30, 2014, Celanese had Debt/EBITDA of 3.0x and Retained Cash Flow/Debt of 18.1% which is fully supportive of a Ba1 rating. The aforementioned metrics include Moody's standard adjustments, which add over $2.billion of additional debt to the company's balance sheet: $960 million for the capitalization of operating leases and $1.1 billion for pension liabilities. While the CFR and the secured facility were upgraded, the ratings on the notes were affirmed as they are subordinate to a meaningful amount of secured debt. If Celanese reduces secured debt by more than $300 million, the unsecured notes would be upgraded to Ba1. Celanese has indicated that it is considering refinancing its highest cost tranche of debt (2018 notes) when it becomes callable in October. Celanese's Ba1 Corporate Family Rating (CFR) is supported by its size and leading global positions in the acetyl chain and substantial operational, geographical and product diversity. The company's elevated exposure to developing markets and investments in new capacity with access to low-cost feedstocks is a credit positive and bodes well for continued earnings growth over the longer term. The company's specialty segments (Engineered Materials and Consumer Specialties) provide more earnings stability and greater growth potential. The rating is tempered by meaningful exposure to volatile pricing and margins in its Acetyl Intermediates segment, sizable debt-like liabilities, management's lack of targeted credit metrics for the firm and the expiration of a low cost methanol contract in 2015. Although management has stated its desire to reduce debt and achieve an investment grade rating, they have not provided any specific detail on the timing or amount of debt repayment that will occur. The company continues to maintain a large and growing cash balance that is over $1 billion. Despite Celanese's very large cash balance, Moody's does not apply net debt metrics as further debt reduction is not a high priority and management has not provided clear guidance on the use of cash or its targeted financial metrics. Net debt credit metrics are supportive of an investment grade rating but the capital structure, with a large amount of secured debt, is not. The stable outlook reflects the expectation for a relatively modest improvement in financial performance in 2015 as normal growth in its specialty segments outpaces the negative impact of the expiration of its advantaged methanol supply contract. An upgrade to the rating is unlikely until Celanese refinances the large amount of secured debt on its balance sheet with unsecured debt, management provides guidance on its targeted financial metrics and the company can sustainably generate Debt/EBITDA of under 3.0x and retained Cash Flow/Debt of less than 20%. A downgrade of the CFR is unlikely unless leverage (Debt/EBITDA) remains above 3.5x and Retained Cash Flow/Debt declines below 15% for an extended period. Celanese's SGL-1 Speculative Grade Liquidity rating reflects robust liquidity with balance sheet cash of over $1 billion, an undrawn $600 million secured revolver due October 31, 2015 and $21 million of availability under its $135 million US accounts receivable program (matures August 2016). Additionally, Moody's expect the company will continue to generate free cash flow of $200-300 million per year over the next two years. Moody's expect the company to have substantial headroom under the sole financial covenant in its revolver through the end of 2015. Celanese also has access to a $135 million securitization facility that matures in 2016. The principal methodology used in this rating was Global Chemical Industry rating methodology published in December 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. Celanese Corporation, headquartered in Dallas, Texas, is a leading global producer of acetyls, vinyl acetate monomer, emulsions, acetate tow, engineered thermoplastics and food ingredients. Celanese reported sales of $6.7 billion for the LTM period ended June 30, 2014. CHIQUITA BRANDS: Gets $625 Million Buyout Offer From Brazilians --------------------------------------------------------------- Peter Evans and Jesse Newman, writing for The Wall Street Journal, reported that a pair of Brazilian companies unleashed a $625 million offer for Chiquita Brands International Inc., seeking to thwart the U.S. banana company's plans to merge with Ireland's Fyffes PLC. According to the report, Cutrale Group, one of the world's largest orange-juice suppliers, and investment firm Safra Group offered to pay $13 in cash per share for Chiquita, a 29% premium to the Aug. 8 closing price, according to the bidders. * * * The March 17, 2014 edition of The Troubled Company Reporter, it was reported that Standard & Poor's Ratings Services revised its rating outlook on Chiquita Brands International Inc. to positive from stable. At the same time, S&P affirmed the 'B' corporate credit rating, 'B' senior secured debt rating, and 'CCC+' unsecured debt rating on the company. The TCR, on Jan. 30, 2014, reported that Moody's Investors Service changed the rating outlook for Chiquita Brands International Inc. to stable from negative while affirming all ratings of the company, including its B2 Corporate Family Rating (CFR) and B2-PD Probability of Default Rating (PDR). Moody's also affirmed the company's SGL-3 liquidity rating. The change in the outlook to stable reflects Moody's expectation for continued improvement in Chiquita's credit metrics, which have recently benefitted from margin improvement largely as a result of cost saving initiatives. CITYCENTER HOLDINGS: S&P Raises CCR to 'B+' on Debt Repayment ------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Las-Vegas based gaming operator CityCenter Holdings LLC to 'B+' from 'B'. The rating outlook is stable. S&P also raised issue-level ratings on the company's senior secured credit facilities by one notch, in accordance with the raised corporate credit rating. The recovery rating on this debt remains '2', indicating S&P's expectation for substantial (70% to 90%) recovery in the event of payment default. "The upgrade reflects an improvement in CityCenter's financial risk profile following the optional prepayment of $150 million in term loan debt and our updated forecast to incorporate stronger anticipated operating results through 2015," said credit analyst Melissa Long. "Resort operations revenue increased 5% and EBITDA increased 10% in the first half of 2014, reflecting positive visitation trends and modest growth in consumer spending, strong hotel occupancy, improving room rates and strength in convention business in the Las Vegas market. We believe these trends are likely to continue in the second half of 2014 and in 2015." The stable rating outlook reflects S&P's expectation the CityCenter's consolidated adjusted debt to EBITDA will remain in the low- to mid-4x area through 2015. Upside Scenario S&P could consider a higher financial risk profile assessment and a higher rating if it believes CityCenter will maintain leverage below 4x. This could be the result of faster than expected EBITDA growth or additional optional debt repayment. S&P could also consider a higher rating if it raised its liquidity assessment on CityCenter to strong. Such a reassessment would require greater clarity regarding the owners' financial policy with regards to leverage and dividends. S&P could also raise the rating if its assessment of the company's business risk profile improves following a track record of stability in operating performance. Downside Scenario S&P could lower the rating if CityCenter's performance falls meaningfully below its current expectations, which could be the result of volatile table hold or an unexpected economic downturn, and/or if dividends to owners lead S&P to conclude that leverage at CityCenter would weaken to and remain above 5.5x over the intermediate term. CLIFFS NATURAL: Moody's Lowers Sr. Unsecured Debt Rating to Ba1 --------------------------------------------------------------- Moody's Investors Service downgraded the senior unsecured debt ratings of Cliffs Natural Resources (Cliffs) to Ba1 from Baa3 and the senior unsecured shelf rating to (P)Ba1 from (P)Baa3 and assigned a Ba1 Corporate Family Rating (CFR) and a Ba1-PD Probability of Default rating. At the same time, Moody's assigned a Speculative Grade Liquidity Rating of SGL-1. This concludes the review for downgrade initiated on July 25, 2014. The rating outlook is negative. The downgrade in the senior unsecured ratings to Ba1 and assignment of the Ba1 CFR reflects Moody's expectations that, despite Cliffs' progress in reducing costs, particularly in its Eastern Canadian and Asia Pacific iron ore operations, continued headwinds pressuring fundamentals and pricing in the iron ore and metallurgical coal industry will result in compression of debt protection metrics and increased leverage through at least 2015. Key debt protection metrics such as EBIT/interest and debt/EBITDA contracted for the twelve months ended June 30, 2014 to 2.1 and 3.6 respectively from 4.2x and 2.2x in fiscal 2013 and given the weak price fundamentals in the iron ore and met coal markets, Moody's expect these metrics to remain under pressure. While some of this contraction can be attributed to the impact of difficult weather conditions through the first and into the second quarter of 2014, there remains more significant ground to be recovered in a pressured iron ore price environment, which Moody's believe will result in a longer time frame for Cliffs to evidence metrics appropriate for an investment grade rating. Given the material new iron ore capacity that has come on line in 2014 together with slower growth rates in Chinese steel production, 62%Fe iron ore prices have fallen, on average, roughly 30% since January 2014 and remain relatively range bound in the $95/tonne trading range. Given Moody's expectation for continued Chinese steel production growth rates in the 3% range in 2014 and comparable rates in 2015, Moody's do not anticipate meaningful improvements in seaborne iron ore prices through 2015. Moody's current sensitivity analysis applies a iron ore price trading range between $95 - $105/tonne (62%Fe). In addition, met coal prices remain under pressure for similar reasons and Moody's expect the coal operations to continue to operate at a negative cash margin. Although the company's US iron ore operations are contract based, with the seaborne price being one component of the pricing equation, its Asia Pacific operations and Eastern Canadian operations are more exposed to price movements in the seaborne market. Factoring these elements together, Moody's believe that leverage is likely to increase to over 4x but at Moody's sensitivity levels remain within a range of 4x to 4.3x. In addition, the timing by which higher cost iron ore production in China and elsewhere is idled or closed remains uncertain and additional low cost capacity additions are still planned by the major seaborne market players such as Rio Tinto and Vale over the next several years. Issuer: Cliffs Natural Resources Inc. Downgrades: Multiple Seniority Shelf Feb 11, 2016, Downgraded to (P)Ba1(LGD4) from (P)Baa3 Senior Unsecured Regular Bond/Debenture, Downgraded to Ba1(LGD4) from Baa3 Assignments: Probability of Default Rating, Assigned Ba1-PD Speculative Grade Liquidity Rating, Assigned SGL-1 Corporate Family Rating, Assigned Ba1 Outlook Actions: Outlook, Changed To Negative From Rating Under Review Ratings Rationale Cliffs Ba1 CFR is supported by its strong position in its US iron ore operations, which in 2014 are expected to produce 22 million tons -- the majority of anticipated consolidated production - and the contract nature of this segment. In addition, the rating considers the progress the company is making in lowering cash costs in its operations, particularly in its Eastern Canadian operations (Bloom Lake) and its Asia Pacific operations. The SGL-1 rating reflects the company's solid liquidity position, characterized by approximately $360 million in cash at June 30, 2014 and availability of roughly $1.5 billion under its $1.75 billion senior unsecured revolving credit facility. In addition, the company recently amended covenants in this facility, eliminating the debt/EBITDA covenant requirement and replacing it with a total debt/capitalization ratio. In addition, this ratio allows for $1.0 billion in impairments to be taken without impacting the required covenant metrics. Given the company's nominal debt maturities and reduced capital expenditures, Moody's expect liquidity to remain more than sufficient relative to requirements. In addition, the first half of 2014 evidenced a significant working capital build, principally in inventory, due to the winter weather impact, which Moody's expect to reverse through the balance of 2014. The Ba1 rating on the senior unsecured instruments under Moody's loss given default methodology reflects the fact that virtually all debt is pari passu in the capital structure. Should the mix of secured and unsecured debt in the capital structure change, the rating on the senior unsecured notes could be negatively impacted. The negative outlook reflects potential head winds still facing the iron ore industry. While Moody's believe the downward price movement has abated, the uncertainty as to growth in Chinese steel production, timing of high cost capacity shut downs, and continued likely new supply are likely to exert a ceiling on any material degree of price escalation through 2015. In addition, Moody's expect prices to continue to show volatility. The outlook also reflects the uncertainty as to the future strategic direction of Cliffs given the change in composition of the board of directors, following the success of Casablanca Capital in its proxy battle, and the steps that will be taken with respect to the future business profile of Cliffs. Given the industry headwinds facing the company and the uncertain strategic direction under the new board, a rating upgrade over the next twelve to eighteen months is unlikely. The rating could be downgraded should EBIT/interest be viewed as sustainable below 3x, debt/EBITDA be sustained above 4x or (cash flow from operations less dividends)/debt be sustained at below 20%. The rating could also be downgraded if there is a significant contraction in liquidity. Headquartered in Cleveland, Ohio, Cliffs is the largest iron ore producer in North America and is also involved in the metallurgical coal industry through its two coking coal mining complexes and to a lesser extent in thermal coal. In addition, the company participates in the international iron ore markets through its subsidiaries in Australia and Canada. For the twelve months ended June 30, 2014, the company had revenues of $5.1 billion. The principal methodology used in these ratings was the Global Mining Industry published in May 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. COLDWATER CREEK: Plan Confirmation Hearing Moved to Sept. 17 ------------------------------------------------------------ Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the District of Delaware issued an amended order approving the disclosure statement explaining Coldwater Creek Inc., et al.'s Third Amended Joint Plan of Liquidation to move the confirmation hearing to Sept. 17, 2014, at 11:30 a.m. (prevailing Eastern Time). Objections to the confirmation of the Plan are due Sept. 10. A full-text copy of the Third Amended Disclosure Statement dated Aug. 8, 2014, is available at http://is.gd/DxIqjd 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 represents the Committee. COLDWATER CREEK: Seeks Extension of Exclusive Periods ----------------------------------------------------- Coldwater Creek Inc., et al., ask the U.S. Bankruptcy Court for the District of Delaware to extend until Nov. 10, 2014, their exclusive period to file a plan, and until Jan. 6, 2015, their exclusive period to solicit acceptances of that plan. The Court has recently approved the disclosure statement explaining the Debtors' Amended Joint Plan of Liquidation and a hearing to consider confirmation of the Plan is currently scheduled for Sept. 17. The Debtors expect that the Plan will be confirmed by Sept. 17, but, out of abundance of caution, filed the extension request with the support of the Official Committee of Unsecured Creditors. The Debtors and the Creditors' Committee agreed that they will each have the co-exclusive right to file and solicit acceptance of a Chapter 11 plan after Sept. 1. A hearing on the extension request is scheduled for Sept. 10, 2014, at 10:00 a.m. (EST). Objections are due Aug. 22. 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 represents the Committee. COLDWATER CREEK: Lease Decision Deadline Extended Until Oct. 31 --------------------------------------------------------------- Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the District of Delaware extended the time period during which Coldwater Creek Inc., et al., may assume or reject leases until Oct. 31, 2014. Landlord Bohannon Development Company, before the Court issued the extension order, asserted that the Court should not extend the lease decision deadline until Oct. 31 as they have indicated no interest in the lease other than to utilize the space through July 31. Bohannon also told the Court that it has entered into an agreement with a replacement tenant whose tenancy is intended to initiate on Sept. 1. 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 represents the Committee. COLOR STAR GROWERS: Gets Approval of Deal With Lenders, Committee ----------------------------------------------------------------- Color Star Growers of Colorado, Inc. received court approval of its settlement agreement with a group of lenders and the official committee of unsecured creditors. Under the terms of the settlement, the lenders will, among other things, allow $750,000 of Color Star's cash collateral to be used solely for allowed administrative expenses. In exchange, the company will provide full releases to the lenders. The lenders are Regions Bank, Comerica Bank, and MCG Capital Corporation and Solutions Capital I, L.P. A copy of the settlement agreement can be accessed for free at http://is.gd/m0EYPb About Color Star Color Star, a grower and wholesaler of flowers and nursery stock with greenhouses and distribution centers in Colorado, Missouri and Texas, filed for Chapter 11 bankruptcy protection in December 2013. Color Star Growers of Colorado, Inc., and two affiliates filed Chapter 11 bankruptcy petitions (Bankr. E.D. Tex. Case Nos. 13-42959 to 13-42961) on Dec. 15, 2013, in Sherman, Texas. The petitions were signed by Brad Walker, chief restructuring officer. The Debtors estimated assets of at least $10 million and liabilities of at least $50 million. Marcus A. Helt, Esq., and Evan R. Baker, Esq., at Gardere Wynne Sewell LLP, serve as the Debtors' counsel. Simon, Ray & Winikka LLP serves as special conflicts counsel. SSG Advisors, LLC provides investment banking services, and UpShot Services LLC serves as claims, noticing and balloting agent. The Official Committee of Unsecured Creditors appointed in the Debtors' cases retained Gavin/Solmonese, LLC as financial advisors; and Raymond J. Urbanik, Esq., Deborah M. Perry, Esq., Thomas Berghman, Esq., and Isaac J. Brown, Esq., at Munsch Hardt Kopf & Harr, PC as attorneys. CONEX HOLDINGS: Court Narrows Trustee's Suit Over 2008 LBO ---------------------------------------------------------- Charles A. Stanziale, Jr., Chapter 7 Trustee for Conex International, LLC, sued the oil industry contractor's former owners and management over a $246 million leveraged buyout in 2008 that allegedly tipped the company into Chapter 7 bankruptcy. In his complaint, the Chapter 7 Trustee alleges breaches of fiduciary duties, among other things, against Ronald W. Schuster, E.A. Roskovensky, Damien W. Kovary, Lawrence G. Wolski, Douglas A. Johnson, Dan M. Schramm, Emily Heisley Stoeckel, Stanley H. Meadows, Gary A. Raduenz, David Van Vleet, and Michael Moorhouse. In Count V of the Complaint, the Chapter 7 Trustee alleges that the Individual Defendants were directors and officers of Conex as well as of Heico Companies LLC, or Heico divisions that directly or indirectly controlled the Debtor. In that capacity, they allegedly caused Conex, while insolvent, to stop paying certain creditors and to pay fraudulent transfer and preference payments to Heico. In response, the Individual Defendants filed motions to dismiss this count of the Complaint for failure to plead adequate facts in support of the fiduciary duty claims. In an August 8, 2014, Memorandum Opinion available at http://is.gd/fGIsLAfrom Leagle.com, Bankruptcy Judge Christopher S. Sontchi grants without prejudice the Motion to Dismiss Count V. The Trustee has not provided adequate facts in support of his claims; however, the Court grants the Trustee leave to amend the Complaint within 30 days of the issuance of this opinion to adequately plead facts to support his breach of fiduciary duty claims against the Individual Defendants arising from the payments made from Conex to Heico. On August 7, 2008, the day Conex was converted from a Texas corporation to a Texas LLC, Holdings bought the interests of Conex in a $246 million leveraged buy-out. The next day, Heico, through Holdings, acquired the membership interests in Conex as well as the stock of Advantage Blasting & Coating, Inc. in exchange for $234,130,000 in cash and certain contingent and deferred payments. Heico's structure of the sales transaction allegedly left Conex with significant debt and insufficient capital. According to the Complaint, "the purchase price was funded through a capital contribution to Conex from Heico in the amount of $77.8 million and bank loans to Conex totaling $163,975,000." The loans were secured by all of Conex's and ABC's assets. Conex allegedly received only $1,449,884 of the $234 million cash payment. The remainder of the money was used to cash-out former shareholders and to pay professionals, as well as bank and transaction fees. On the Closing Date, Conex allegedly did not have sufficient working capital to be able to meet its future cash payments. Almost immediately after the Closing Date, with Heico controlling Conex, Conex became insolvent. At the end of 2008, Conex had a negative working capital. Pursuant to the Complaint, "its current liabilities exceeded its current assets by approximately $18 million." At the end of 2009, Conex's current liabilities exceeded its current assets by $156 million and by the end of 2010 by $173 million. Conex's sales revenue, gross profit and net income deteriorated significantly shortly after the Closing Date. For the first eight months of 2008, Conex's contract revenue was approximately $197.6 million, its gross profit approximately $37.3 million, and its net income $35.2 million. These numbers dropped to approximately $76.6 million, $14.3 million, and $4.85 million respectively during the remainder of 2008. The operating results further deteriorated in 2009 and only slightly improved for 2010. At the end of December 2009, "Conex's contract revenue was approximately $111.4 million, a decrease of approximately $162.8 million from 2008's full year contract revenue and a decrease of approximately $93 million from 2007's full year contract revenue." In 2009, less than 11 months after the Closing Date, Conex defaulted under its credit agreement and stopped paying its bank debt. At the same time, the transfers to Heico commenced, which allegedly continued until the filing of the involuntary bankruptcy petition. Heico allegedly "authorized and directed" Conex to make payments to Heico in the amount of $10,990,914 during the two years prior to the Petition Date. Further, Heico allegedly received $7,144,972 in preference payments from Conex in the one year period prior to the Petition Date. These transfers were allegedly made while the Debtors did not service their bank debt. In addition to these transfers, Heico allegedly caused the Debtor "to transfer to Heico Conex's right to collect a $614,377.65 receivable from Ceco Construction, LLC (a company that is owned and controlled by Heico)" and "to reduce its pre-paid insurance account by $402,276.50 and transfer its interest to Heico." These transfers occurred at a time at which Conex was either insolvent, rendered insolvent, or did not have enough working capital. On Feb. 20, 2011, Wells Fargo, Bank of Montreal, and The Prudential Insurance Company of America, commenced an involuntary Chapter 7 bankruptcy case against Conex Holdings, LLC, and an involuntary Chapter 11 bankruptcy cases against Conex International, LLC (Bankr. D. Del. Case No. 11-10503) and Advantage Blasting & Coating, LLC (Bankr. D. Del. Case No. 11- 10502). The adversary case is, CHARLES A. STANZIALE, JR., in his capacity as the Chapter 7 Trustee of Conex International, LLC, f/k/a Conex International Corporation, Plaintiff, v. HEICO HOLDINGS, INC., RONALD W. SCHUSTER; E.A. ROSKOVENSKY; DAMIEN W. KOVARY; LAWARENCE G. WOLSKI; DOUGLAS A. JOHNSON; DAN M. SCHRAMM; EMILY HEISLEY STOECKEL; STANLEY H. MEADOWS; GARY A RADUENZ; DAVID VAN VLEET; AND MICHAEL MOORHOUSE, Defendants, Adv. Proc. No. 13-50941 (CSS) (Banr. D. Del.). Counsel for Certain Individual Defendants are: William E. Chipman, Jr., Esq. Mark D. Olivere, Esq. COUSINS CHIPMAN & BROWN, LLP 1007 North Orange Street, Suite 1110 Wilmington, DE 19801 Tel: (302) 295-0191 E-mail: chipman@ccbllp.com olivere@ccbllp.com - and - Bruce S. Sperling, Esq. Robert D. Cheifetz, Esq. SPERLING & SLATER, P.C. 55 West Monroe Street, Suite 3200 Chicago, IL 60603 Tel: 312-641-3200 Fax: 312-641-6492 E-mail: bss@sperling-law.com robc@sperling-law.com Counsel to Charles A. Stanziale, Jr., the Chapter 7 Trustee, are: Katharine L. Mayer, Esq. McCARTER & ENGLISH, LLP Renaissance Centre 405 N. King St., 8th Flr. Wilmington, DE 19801 Tel: 302-984-6312 Fax: 302-984-2494 E-mail: kmayer@mccarter.com - and - Charles A. Stanziale, Jr., Esq. Jeffrey T. Testa, Esq. Michael J. Reynolds, Esq. McCARTER & ENGLISH, LLP Four Gateway Center 100 Mulberry St. Newark, NJ 07102 Tel: 973-639-7908 Fax: 973-297-6231 E-mail: cstanziale@mccarter.com jtesta@mccarter.com mreynolds@mccarter.com CONNEAUT LAKE PARK: Trustees Seek Bankruptcy Lawyer's Advice ------------------------------------------------------------ Keith Gushard, writing for Meadville Tribune, reported that the trustees of Conneaut Lake Park, a nonprofit corporation that oversees the public trust that owns the amusement park, met in executive session for more than an hour and 15 minutes on Aug. 5 at the Hotel Conneaut with attorney George T. Snyder, a partner in the Pittsburgh law firm of Stonecipher, Cunningham, Beard & Schmitt, which specializes in commercial bankruptcy and insolvency law. The report said bankruptcy filing remains a possible option for Conneaut Lake Park to halt a possible sheriff's sale or tax sale for more than $925,000 in overdue property taxes, interest and penalties. According to the report, Crawford County commissioners have not taken any official action in support of a sheriff's sale, but they have stated previously Conneaut Lake Park remains scheduled to go up for sale at the county treasurer's annual tax upset sale on Sept. 26. The report added that no decision has been made, according to Mark Turner, an executive director of Trustees of Conneaut Lake Park, said following the board's executive session. CONNECTEDU INC: Gates Foundation Seeks Docs Over Grant Funds ------------------------------------------------------------ The Bill & Melinda Gates Foundation last week filed papers in the Chapter 11 case of ConnectEDU Inc. et al, seeking an order pursuant to Rule 2004 of the Federal Rules of Bankruptcy Procedure to compel the Debtors to disclose certain documents and respond to interrogatories on or before Sept. 12 at 5:00 p.m. In July 2013, the Gates Foundation awarded ConnectEDU a grant in the total amount of $499,375, conditioned on ConnectEDU meeting certain requirements. The grant was extended for the charitable purpose of building an innovative technology platform that will empower students to master certain common core standards for literacy through an engaging, personalized and collaborative learning experience. In June 2014, the foundation filed a proof of claim against ConnectEDU for the return of any amounts not used for grant purposes. The foundation is represented by: Eunice R. Hudson, Esq. K&L GATES LLP 599 Lexington Avenue New York, NY 10022 Tel: 212-535-3900 Fax: 212-536-3901 - and - R. Gibson Masters, Esq. K&L GATES LLP One SW Columbia Street, Suite 1900 Portland, OR 97258 Tel: 503-228-3200 Fax: 503-248-9085 - and - David C. Neu, Esq. K&L GATES LLP 925 Fourth Avenue, Suite 2900 Seattle, WA 98104 Tel: 206-623-7580 Fax: 206-623-7022 ConnectEdu Inc., a maker of education-related technology, filed for Chapter 11 bankruptcy protection in Manhattan, on April 28, 2014. The case is In re ConnectEdu, Inc., Case No. 14-11238 (Bankr. S.D.N.Y.). The Debtor's counsel is Wojciech F Jun, Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler LLP. The filing lists ConnectEdu's assets at between $1 million and $10 million against liabilities of between $10 million and $50 million. CRUMBS BAKE SHOP: Customer Data Needs Shield, Watchdog Says ----------------------------------------------------------- Sherri Toub, substituting for Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that U.S. Department of Justice's bankruptcy watchdog said Crumbs Bake Shop Inc. shouldn't be able to auction off customer lists without oversight as such a sale would violate the company's privacy policy. According to the report, the U.S. Trustee asked the court to appoint a "consumer privacy ombudsman" to ensure that personally identifiable customer information, such as names, addresses and phone numbers, is protected in the sale. About Crumbs Bake Shop Crumbs Bake Shop, Inc. (OTCBB: CRMB), a New York-based cupcake specialty store chain, and 22 of its affiliates filed separate Chapter 11 bankruptcy petitions (Bankr. D. N.J. Lead Case No. 14-24287) on July 11, 2014. John D. Ireland signed the petitions as chief financial officer. Crumbs Bake Shop estimated assets of $10 million to $50 million and the same range of liabilities. Cole, Schotz, Meisel, Forman & Leonard, P.A., acts as the Debtors' counsel. Glass Ratner is serving as Crumbs' financial advisor. Prime Clerk LLC is the Debtors' claims and noticing agent. Judge Michael B. Kaplan oversees the jointly administered cases. * * * On July 7, 2014, the Board of Directors of Crumbs Bake Shop determined to cease operations effective immediately. The Board's determination was made after the Company lacked sufficient liquidity to maintain current operations. On the petition date, Crumbs entered into an Asset Purchase Agreement through which Lemonis Fischer Acquisition Company, LLC, a joint venture created by Marcus Lemonis LLC and Fischer Enterprises, L.L.C., will acquire the Crumbs' business as part of the Company's Chapter 11 filing. The Debtor will sell itself at a bankruptcy auction on Aug. 21. The lead bidder has a $6.5 million credit bid. A hearing to approve the sale is scheduled to take place on Aug. 26. The Company hopes to complete the sale process in approximately 60 days, pending receipt of the necessary approvals from the Bankruptcy Court. Lemonis Fischer Acquisition is represented by Louis Price, Esq., at McAfee & Taft PC. CRYSTAL CATHEDRAL: 9th Circ. Axes Founder's $5M Comp Claim ---------------------------------------------------------- Law360 reported that the Ninth Circuit denied Crystal Cathedral Ministries founder Dr. Robert H. Schuller's $5 million compensation claim in the church's bankruptcy, ruling he was entitled to only one-year's compensation under an employment agreement written when he stepped down as senior pastor. According to the report, upholding a California federal judge's affirmation of a bankruptcy court's November 2012 decision that Schuller was only entitled to $600,000, the appeals court held in a split decision that he was an employee, and therefore the parties' "transition agreement" amounted to an employment contract. The case is In re: Crystal Cathedral Ministries, et al v. Karen Naylor, et al., Case No. 13-56039 (9th Cir.). About Crystal Cathedral Crystal Cathedral filed for Chapter 11 bankruptcy protection (Bankr. C.D. Calif. 10-24771) on Oct. 18, 2010. The Debtor disclosed $72,872,165 in assets and $48,460,826 in liabilities as of the Chapter 11 filing. Marc J. Winthrop, Esq., at Winthrop Couchot P.C. represents the Debtor. Todd C. Ringstad, Esq., at Ringstad & Sanders, LLP, represents the Official Committee of Unsecured Creditors. In November 2011, Crystal Cathedral won Court permission to sell its property to the Roman Catholic Diocese of Orange for $57.5 million. The Diocese beat a rival bid from Chapman University. The sale agreement provides that the congregation will have three years to find new premises. Chapman University, the secular bidder, was the preferred buyer as far as the church members are concerned, because Chapman would allow the ministry to continue to use the main buildings on the premises. It also offered the option of allowing church administrators to buy the property back at a later point. Chapman raised its bid to $59 million, but the Crystal Cathedral board still chose the Diocese. CUE & LOPEZ: Court Extends Oriental Bank's Reply Deadline --------------------------------------------------------- Oriental Bank on March 5, 2014, sought for the appointment of an examiner in the Chapter 11 cases of Cue & Lopez Construction Inc. and Cue & Lopez Contractors, Inc. Cue & Lopez vehemently opposed the appointment as unduly burdensome and unnecessary. Cue & Lopez sought sanctions against the bank for pursuing it. William Santiago-Sastre, Esq., at De Diego Law Offices, PSC, in Carolina, Puerto Rico, noted that Cue & Lopez's assertions were issues that were not addressed in the bank's original request for the appointment of an examiner. The bank wants the opportunity to reply to the allegations, including calculations of total payments to insiders and new information presented in Cue & Lopez's monthly report. Oriental Bank, however, was not able to file a reply in the time allotted by the Bankruptcy Court. Mr. Santiago-Sastre explained that the delay was because: (a) numerous documents produced by Cue & Lopez must be examined consisting of construction contracts, supplier contracts, and supporting documents for petty cash checks of more than $1,000; (b) deposing Cue & Lopez with regard to these documents have yet to be held; (c) key bank officers were unavailable to assist counsel; and (d) the bank had to file its objection to the disclosure statement with several exhibits containing new information. Mr. Santiago-Sastre pointed out that Oriental Bank's reply to Cue & Lopez's objection is more extensive than originally thought because new information and disclosures provided additional evidence and grounds for the appointment of an examiner. Accordingly, at the bank's request, the Court extends the deadline for Oriental Bank to file a reply to the objection. Oriental Bank is represented by: William Santiago-Sastre, Esq. De Diego Law Offices, PSC PO Box 79552 Carolina, PR 00984-9552 Tel: 787-622-3942 Fax: 787- 622-3941 E-mail: wssbankruptcy@gmail.com About Cue & Lopez San Juan, Puerto Rico-based Cue & Lopez Construction, Inc., sought protection under Chapter 11 of the Bankruptcy Code on Oct. 4, 2013 (Case No. 13-08297, Bankr. D.P.R.). The case is assigned to Judge Brian K. Tester. Cue & Lopez Contractors, Inc., filed a separate Chapter 11 petition (Case No. 13-08299) on the same date. The Debtors are represented by Charles Alfred Cuprill, Esq., at Charles A Curpill, PSC Law Office, in San Juan, Puerto Rico. CPA Luis R. Carrasquillo & Co., P.S.C., serves as accountant. Cue & Lopez Construction scheduled $13,334,151 in total assets and $17,520,089 in total liabilities. The Chapter 11 petitions were signed by Frank F. Cue Garcia, president. DETROIT, MI: Amended Terms of Agreement with Police Assoc. OK'd --------------------------------------------------------------- Judge Steven Rhodes of the U.S. Bankruptcy Court for the Eastern District of Michigan, Southern Division, approved a stipulation reflecting amended terms of a tentative agreement between the city of Detroit and the Detroit Police Officers Association regarding the city's plan of debt adjustment. The court-approved stipulation provides that DPOA will be permitted to re-file its objections if the DPOA membership does not ratify a collective bargaining agreement by Aug. 15, 2014. If the DPOA membership does not ratify a CBA by Aug. 15, then (a) any Class 14 Ballot that accepts the Plan submitted by the DPOA will not be counted for purposes of determining whether Class 14 has accepted the Plan in accordance with Section 1126(c) of the Bankruptcy Code; and (b) the Claims and Balloting Agent will File, no later than Aug. 25, a revised tabulation affidavit with respect to Class 14 reflecting the exclusion of the DPOA Class 14 Ballot. About City of Detroit, Michigan The City of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The City's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Hon. Steven Rhodes oversees the bankruptcy case. Detroit is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing the American Federation of State, County and Municipal Employees and the International Union. Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is representing the United Automobile, Aerospace and Agricultural Implement Workers of America. A nine-member official committee of retired workers was appointed in the case. The Retirees' Committee is represented by Dentons US LLP. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. DETROIT, MI: Federal Court Agrees to Suspend Bankruptcy Appeals --------------------------------------------------------------- Reuters reported that the U.S. Court of Appeals for the Sixth Circuit agreed to suspend seven cases seeking to overturn a lower court ruling that found Detroit was eligible for municipal bankruptcy, following motions filed by attorneys for Detroit pension funds, unions and others requesting that the cases be suspended instead of dismissed until the city concludes a confirmation process for its bankruptcy exit plan. About City of Detroit, Michigan The City of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The City's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Hon. Steven Rhodes oversees the bankruptcy case. Detroit is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing the American Federation of State, County and Municipal Employees and the International Union. Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is representing the United Automobile, Aerospace and Agricultural Implement Workers of America. A nine-member official committee of retired workers was appointed in the case. The Retirees' Committee is represented by Dentons US LLP. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. DETROIT, MI: City Mayor Addresses Water Shut-Off Program -------------------------------------------------------- Joe Guillen, writing for Detroit Free Press, reported that the city of Detroit's mayor has announced a new plan to address the city's water shut-off program. According to the report, residents, under the plan, will have an easier time enrolling in payment plans for unpaid water bills and late payment penalties will be waived. The plan also aims to better inform residents when their water service could be cut and make it easier for customers to make payments, the report said, citing the mayor. About City of Detroit, Michigan The City of Detroit, Michigan, weighed down by more than $18 billion in accrued obligations, sought municipal bankruptcy protection on July 18, 2013, by filing a voluntary Chapter 9 petition (Bankr. E.D. Mich. Case No. 13-53846). Detroit listed more than $1 billion in both assets and debts. Kevyn Orr, who was appointed in March 2013 as Detroit's emergency manager, signed the petition. Detroit is represented by lawyers at Jones Day and Miller Canfield Paddock and Stone PLC. Michigan Governor Rick Snyder authorized the bankruptcy filing. The filing makes Detroit the largest American city to seek bankruptcy, in terms of population and the size of the debts and liabilities involved. The City's $18 billion in debt includes $5.85 billion in special revenue obligations, $6.4 billion in post-employment benefits, $3.5 billion for underfunded pensions, $1.13 billion on secured and unsecured general obligations, and $1.43 billion on pension- related debt, according to a court filing. Debt service consumes 42.5 percent of revenue. The city has 100,000 creditors and 20,000 retirees. The Hon. Steven Rhodes oversees the bankruptcy case. Detroit is represented by David G. Heiman, Esq., and Heather Lennox, Esq., at Jones Day, in Cleveland, Ohio; Bruce Bennett, Esq., at Jones Day, in Los Angeles, California; and Jonathan S. Green, Esq., and Stephen S. LaPlante, Esq., at Miller Canfield Paddock and Stone PLC, in Detroit, Michigan. Sharon Levine, Esq., at Lowenstein Sandler LLP, is representing the American Federation of State, County and Municipal Employees and the International Union. Babette Ceccotti, Esq., at Cohen, Weiss & Simon LLP, is representing the United Automobile, Aerospace and Agricultural Implement Workers of America. A nine-member official committee of retired workers was appointed in the case. The Retirees' Committee is represented by Dentons US LLP. Lazard Freres & Co. LLC serves as the Retiree Committee's financial advisor. DEWEY & LEBOEUF: Judge Stays Insurer's Case Against Defendants -------------------------------------------------------------- MP McQueen, writing for The Am Law Daily, reported that a federal court judge in Iowa has granted a stay in Aviva Life and Annuity Company's civil lawsuit against three former Dewey & LeBoeuf executives for allegedly making false and misleading statements as part of a 2010 bond offering. According to the report, the judge also allowed the defendants -- former chairman Steven Davis, former executive director Stephen DiCarmine and former chief financial officer Joel Sanders -- to ask the U.S. Court of Appeals for the Eighth Circuit to hear an interlocutory appeal of his May 19 decision denying their motion to dismiss the case on grounds that the insurance company has no standing because it sold off the bonds and claims that are at the center of the case. About Dewey & LeBoeuf Dewey & LeBoeuf LLP sought Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 12-12321) to complete the wind-down of its operations. The firm had struggled with high debt and partner defections. Dewey disclosed debt of $245 million and assets of $193 million in its chapter 11 filing late evening on May 29, 2012. Dewey & LeBoeuf LLP operated as a prestigious, New York City- based, law firm that traced its roots to the 2007 merger of Dewey Ballantine LLP -- originally founded in 1909 as Root, Clark & Bird -- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally founded in 1929. In recent years, more than 1,400 lawyers worked at the firm in numerous domestic and foreign offices. At its peak, Dewey employed about 2,000 people with 1,300 lawyers in 25 offices across the globe. When it filed for bankruptcy, only 150 employees were left to complete the wind-down of the business. Dewey's offices in Hong Kong and Beijing are being wound down. The partners of the separate partnership in England are in process of winding down the business in London and Paris, and administration proceedings in England were commenced May 28. All lawyers in the Madrid and Brussels offices have departed. Nearly all of the lawyers and staff of the Frankfurt office have departed, and the remaining personnel are preparing for the closure. The firm's office in Sao Paulo, Brazil, is being prepared for closure and the liquidation of the firm's local affiliate. The partners of the firm in the Johannesburg office, South Africa, are planning to wind down the practice. The firm's ownership interest in its practice in Warsaw, Poland, was sold to the firm of Greenberg Traurig PA on May 11 for $6 million. The Pension Benefit Guaranty Corp. took $2 million of the proceeds as part of a settlement. Judge Martin Glenn oversees the case. Albert Togut, Esq., at Togut, Segal & Segal LLP, represents the Debtor. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. The petition was signed by Jonathan A. Mitchell, chief restructuring officer. JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the lenders under the Revolver Agreement, hired Kramer Levin Naftalis & Frankel LLP. JPMorgan, as Collateral Agent for the Revolver Lenders and the Noteholders, hired FTI Consulting and Gulf Atlantic Capital, as financial advisors. The Noteholders hired Bingham McCutchen LLP as counsel. The U.S. Trustee formed two committees -- one to represent unsecured creditors and the second to represent former Dewey partners. The creditors committee hired Brown Rudnick LLP led by Edward S. Weisfelner, Esq., as counsel. The Former Partners hired Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at Klestadt & Winters, LLP, as counsel. FTI Consulting, Inc. was appointed secured lender trustee for the Secured Lender Trust. Alan Jacobs of AMJ Advisors LLC, was named Dewey's liquidation trustee. Scott E. Ratner, Esq., Frank A. Oswald, Esq., David A. Paul, Esq., Steven S. Flores, Esq., at Togut, Segal & Segal LLP, serve as counsel to the Liquidation Trustee. Dewey's liquidating Chapter 11 plan was approved by the bankruptcy court in February 2013 and implemented in March. The plan created a trust to collect and distribute remaining assets. The firm estimated that midpoint recoveries for secured and unsecured creditors under the plan would be 58.4 percent and 9.1 percent, respectively. DIGITAL DOMAIN: Fla. Says $20M in Tax Credits Not Part of Estate ---------------------------------------------------------------- Law360 reported that the Florida Department of Economic Opportunity asked a Delaware bankruptcy judge to rule that $20 million in tax credits Digital Domain Media Group Inc. applied for aren't part of the debtor's estate because the "Titanic" special effects shop never met the conditions for final approval. About Digital Domain Port St. Lucie, Florida-based Digital Domain Media Group, Inc. -- http://www.digitaldomain.com/-- engaged in the creation of original content animation feature films, and development of computer-generated imagery for feature films and trans-media advertising primarily in the United States. Digital Domain Media Group, Inc. and 13 affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 12-12568) on Sept. 11, 2012, to sell its business for $15 million to Searchlight Capital Partners LP, subject to higher and better offers. The Company disclosed assets of $205 million and liabilities totaling $214 million. The Debtors also have sought ancillary relief in Canada, pursuant to the Companies' Creditors Arrangement Act in the Supreme Court of British Columbia, Vancouver Registry. Attorneys at Pachulski Stang Ziehl & Jones serve as counsel to the Debtors. FTI Consulting, Inc.'s Michael Katzenstein is the chief restructuring officer. Kurtzman Carson Consultants LLC is the claims and notice agent. An official committee of unsecured creditors appointed in the case is represented by lawyers at Sullivan Hazeltine Allinson LLC and Brown Rudnick LLP. At a bankruptcy auction, the principal part of the business was purchased by a joint venture between Galloping Horse America LLC, an affiliate of Beijing Galloping Horse Co., and an affiliate of Reliance Capital Ltd., based in Mumbai. The $36.7 million total value of the contact includes $3.6 million to cure defaults on contracts and $2.9 million in reimbursement of payroll costs. As the result of a settlement negotiated by the unsecured creditors' committee with secured lenders, there will be some recovery for the committee's constituency. DOTS LLC: Bounces Back as New Owner Re-opens Some Stores -------------------------------------------------------- Katy Stech, writing for The Wall Street Journal, reported that New Dots LLC, which bought the Dots LLC's brand, is slowly resurrecting the stores by re-opening. According to the Journal, the new owner plans to open 120 Dots stores by the end of next year. About DOTS LLC Dots is a retailer of fashionable clothing, accessories, and footwear for price-conscious women. Dots provides missy and plus size choices to fashion savvy 25 to 35 year old women at approximately 400 retail stores throughout the Midwest, East, and South United States. Dots' workforce includes 3,500 individuals in their stores, distribution center, and corporate headquarters. Dots, LLC, and its affiliates sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 14-11016) on Jan. 20, 2014, to sell some or all of their assets. Lowenstein Sandler LLP serves as counsel to the Debtors. PricewaterhouseCoopers LLP is financial advisor and investment banker. Donlin, Recano & Company, Inc., is the claims and notice agent. As of the Petition Date, the Debtors have outstanding secured debt owed to senior lender Salus Capital Partners, LLC, of which $14.5 million remains outstanding under a revolving facility and $16.1 million is owed under a term facility. The Debtors also have not less than $17 million outstanding under subordinated term loan agreements with Irving Place Capital Partners III L.P. ("IPC") and related entities. Moreover, the Debtors have aggregate unsecured debts of $47.0 million. The Debtors disclosed $51,574,560 in assets and $85,442,656 in liabilities as of the Chapter 11 filing. Salus, the prepetition senior lender and the DIP lender, is represented by Morgan, Lewis & Bockius, LLP. The prepetition subordinated lenders are represented by Okin Hollander & DeLuca, LLP. The Company has arranged to borrow $36 million to keep operating as it reorganizes under court protection. Otterbourg P.C. serves as counsel to the Official Committee of Unsecured Creditors; and FTI Consulting, Inc., serves as its financial advisor. ELBIT IMAGING: Provides Add'l Update to Annual Meeting Proposal --------------------------------------------------------------- Elbit Imaging Ltd. announced additional updates regarding a proposal on the agenda of its annual general meeting of shareholders scheduled to be held on Aug. 14, 2014. Proposal No. 4 - Compensation Policy for Officers and Directors With respect to the Company's proposed Compensation Policy for Directors and Officers, the Company has undertaken to Entropy Financial Research Ltd., an Israeli shareholder advisory firm, as follows: The Company intends to engage no more than two office holders under the compensation terms detailed in the Compensation Policy for the positions of Chairman of the Board of Directors, CEO and General Manager. The Company further intends to reevaluate the compensation terms for its office holders in approximately a year's time and its Compensation Committee will perform an evaluation of such compensation terms on an annual basis. The Company has further undertaken to Entropy, that it will discuss the appointment and compensation terms of a full time CEO, once it receives the recommendations of a special committee formed for the purpose of locating suitable candidates, within one year, as the position of Acting CEO (to the extent approved by the shareholders of the Company) is due to expire during that period. The terms of the full time CEO, once elected, will be subject to the approval of the Company's General Meeting. About Elbit Imaging Ltd. Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF) hold investments in real estate and medical companies. The Company, through its subsidiaries, also develops shopping and entertainment centers in Central Europe and invests in and manages hotels. Since February 2013, Elbit has intensively endeavored to come to an arrangement with its creditors. Elbit has said it has been hanging by a thread for more than five months. It has encountered cash flow difficulties and this burdens its day to day activities, and it certainly cannot make the necessary investments to improve its assets. In light of the arrangement proceedings, and according to the demands of most of the bondholders, as well as an agreement that was signed on March 19, 2013, between Elbit and the Trustees of six out of eight series of bonds, Elbit is prohibited, inter alia, from paying off its debts to the financial creditors - - and as a result a petition to liquidate Elbit was filed, and Bank Hapoalim has declared its debts immediately payable, threatening to realize pledges that were given to the Bank on material assets of the Company -- and Elbit undertook not to sell material assets of the Company and not to perform any transaction that is not during its ordinary course of business without giving an advance notice to the trustees. Accountant Rony Elroy has been appointed as expert for examining the debt arrangement in the Company. In July 2013, Elbit Imaging's controlling shareholders, Europe- Israel MMS Ltd. and Mr. Mordechay Zisser, notified the Company that the Tel Aviv District Court has appointed Adv. Giroa Erdinast as a receiver with regards to the ordinary shares of the Company held by Europe Israel securing Europe Israel's obligations under its loan agreement with Bank Hapoalim B.M. The judgment stated that the Receiver is not authorized to sell the Company's shares at this stage. Following a request of Europe-Israel, the Court also delayed any action to be taken with regards to the sale of those shares for a period of 60 days. Europe Israel and Mr. Zisser have also notified the Company that they utterly reject the Bank's claims and intend to appeal the Court's ruling. Elbit Imaging reported a loss of NIS1.56 billion on NIS360.59 million of total revenues for the year ended Dec. 31, 2013, as compared with a loss of NIS483.98 million on NIS418.48 million of total revenues in 2012. The Company's balance sheet at Dec. 31, 2013, showed NIS4.56 billion in total assets, NIS4.97 billion in total liabilities and a NIS408.63 million shareholders' deficit. Brightman Almagor Zohar & Co., a member firm of Deloitte Touche Tohmatsu, in Tel-Aviv, Israel, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. ENERGY FUTURE: Solvency Ruled Discoverable in Make-Whole Fight -------------------------------------------------------------- Law360 reported that Judge Christopher S. Sontchi of the U.S. Bankruptcy Court for the District of Delaware issued a 25-page opinion ruling that information regarding a subsidiary of private equity-owned Energy Future Holdings Inc.'s solvency is discoverable in the context of an adversary action lodged by CSC Trust Co. of Delaware, the indenture trustee for a group of senior secured noteholders looking for a $665 million payment if the energy giant refinances the notes. According to the report, if the indenture trustee is successful in its claim, and the debtor is found to be solvent, the court can directly enforce under applicable state law the terms of the agreement EFIH, which holds an 80 percent stake in nondebtor Oncor Electric Delivery Company LLC, struck with the lenders of about $3.5 billion of 10-percent senior secured notes. The adversary case is CSC Trust Co. of Delaware v. Energy Future Intermediate Holdings LLC et al, case number 1:14-ap-50363, in the same venue. 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. ENERGY FUTURE: Drops Bid to Take Part in Optim Asset Auction ------------------------------------------------------------ Energy Future Holdings Corp. withdrew its motion to allow Luminant Generation Company LLC and two other subsidiaries to make a bid for Optim Energy, LLC's assets. The power producer, however, said it may file a new motion "seeking substantially the same relief" at a later date. In June, Optim Energy, another bankrupt Texas-based power producer, asked for court approval to hold an auction of its coal plants in Bremond, Texas, with Twin Oaks Power LLC's $82 million offer serving as the stalking horse bid. Optim Energy previously received a $60 million offer from Major Oak Power LLC, an affiliate of The Blackstone Group LP. Earlier reports said Major Power doesn't intend to complete the deal. 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. ENERGY FUTURE: Given Six-Month Extension to Remove Suits -------------------------------------------------------- Energy Future Holdings Corp. has been given a six-motnh extension to remove lawsuits involving the company and its affiliated debtors. U.S. Bankruptcy Judge Christopher Sontchi extended the deadline for the company to remove the lawsuits to January 26 from July 28. Energy Future and its affiliated debtors are involved in more than 420 civil actions. The company had said it needs more time "to properly evaluate the potential removal of each of the actions." 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. ENGLOBAL CORP: Posts $1.6 Million Net Income in Second Quarter -------------------------------------------------------------- ENGlobal Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $1.59 million on $27.17 million of operating revenues for the three months ended June 28, 2014, as compared with a net loss of $1.58 million on $50.64 million of operating revenues fo the three months ended June 29, 2013. The Company also reported net income of $3.40 million on $54.06 million of operating revenues for the six months ended June 28, 2014, as compared with net income of $350,000 on $100.41 million of operating revenues for the six months ended June 29, 2013. As of June 28, 2014, the Company had $51.02 million in total assets, $24.87 million in total liabilities and $26.14 million in total stockholders' equity. Mark Hess, ENGlobal's chief financial officer, said: "I believe we are continuing to see positive results from initiatives that have been undertaken at ENGlobal over the last two years. Our improved performance is best demonstrated by a significant increase in margins, consistent project execution, as well as substantial internal growth in our continuing operations." Mr. Hess continued: "We maintained a substantial cash balance and had no borrowings during the quarter. However, we are working with a regional bank to replace our current credit facility that matures at the end of the third quarter with a similar three year facility that will help provide the working capital to sustain our growth. While there is still some work to be done, we expect a new facility to be in place during September." "We're obviously proud to report this third consecutive profitable quarter, which represents a major turnaround in our business from recent years," said William Coskey, P.E., Chairman and chief executive officer of ENGlobal. "We continue to be excited about capitalizing on ENGlobal's differentiated expertise and proprietary technologies, whereby we provide value to our clients. In addition, we expect to begin evaluating select external growth opportunities -- having similar characteristics and potentially providing additional capabilities for our firm." A full-text copy of the Form 10-Q is available for free at: http://is.gd/jhPZG8 About ENGlobal Houston-based ENGlobal Corporation (Nasdaq: ENG) is a provider of engineering and related project services primarily to the energy sector throughout the United States and internationally. ENGlobal operates through two business segments: Automation and Engineering. ENGlobal's Automation segment provides services related to the design, fabrication and implementation of advanced automation, control, instrumentation and process analytical systems. The Engineering segment provides consulting services for the development, management and execution of projects requiring professional engineering, construction management, and related support services. ENGlobal incurred a net loss of $2.98 million for the year ended Dec. 28, 2013, a net loss of $33.60 million for the year ended Dec. 29, 2012 and a net loss of $7.07 million for the year ended Dec. 31, 2011. ENTEGRA POWER: Plan & Disclosure Statement Hearing on Sept. 19 -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware will convene a hearing on Sept. 19, 2014, at 2:00 p.m. (prevailing Eastern Time) to consider, among other things, the adequacy of the disclosure statement and the confirmation of Entegra Power Group LLC, et al.'s prepackaged plan of reorganization. The prepackaged plan proposes full payment to holders of general unsecured claims, prepetition second lien claims, other secured claims, and intercompany claims. Holders of allowed prepetition second lien claims owed $237 million will receive their pro rata share of new second lien Series A notes plus cash received by the Debtors from the proceeds of the new second lien series B notes. Holders of prepetition third lien claims is expected to recover 64.6%. Holders of allowed prepetition third lien claims owed $1.31 billion will receive their pro rata share of (a) 100% of the ETC senior equity interests and (b) $550 million in principal amount of new third lien debt. In addition, eligible Holders of allowed prepetition third lien claims will be permitted to purchase new second lien notes in the form of New Second Lien Series B Notes. Any responses or objections to the approval of the Disclosure Statement and the confirmation of the Plan must be submitted on or before Sept. 8. The Debtors may file a single consolidated reply brief in response to any objections by Sept. 15. According to Christina Pullo, director of solicitation of Prime Clerk LLC, only holders of Prepetition Second Lien Claims, Prepetition Third Lien Claims, and Equity Interests in Parent are entitled to vote under the Plan, and 100% of the holders of these claims voted to accept the Plan. The Court ruled that the meeting of the Debtors' creditors under Section 341 of the Bankruptcy will be waived unless the Plan is not confirmed on or before Oct. 15. The Court also extended until Oct. 15 the time by which the Debtors must file their schedules of assets and liabilities and statements of financial affairs; provided that if the Plan is confirmed on or before Oct. 15, the requirement to file SOFAs and Schedules is waived. About Entegra Power Group Entegra Power Group LLC and its affiliates operate an independent power company that owns one of the largest gas-fueled power plants in the United States, located in El Dorado, Arkansas. In addition, affiliate Gila River Energy Holdco LLC indirectly owns one-half of another of the country's largest gas-fueled power plants, in Gila Bend, Arizona. The Entegra entities market electric power from the two facilities to wholesale customers in the southeastern and southwestern United States. Entegra, Gila, and 10 other affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 14-11859) on Aug. 4, 2014. The cases are pending before the Honorable Peter J. Walsh, and the Debtors have requested that their cases be jointly administered. The Debtors have tapped Richards, Layton & Finger, P.A., as counsel, and Prime Clerk LLC as claims and notice agent. The Gila facility's direct owners are not debtors in the Chapter 11 cases, and the Gila Facility will not become property of the Debtors' estates. ENTEGRA POWER: Has Authority to Hire Prime Clerk as Claims Agent ---------------------------------------------------------------- Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware authorized Entegra Power Group LLC, et al., to employ Prime Clerk LLC as claims and noticing agent to receive, maintain, record and otherwise administer the proofs of claims filed in the Chapter 11 cases. About Entegra Power Group Entegra Power Group LLC and its affiliates operate an independent power company that owns one of the largest gas-fueled power plants in the United States, located in El Dorado, Arkansas. In addition, affiliate Gila River Energy Holdco LLC indirectly owns one-half of another of the country's largest gas-fueled power plants, in Gila Bend, Arizona. The Entegra entities market electric power from the two facilities to wholesale customers in the southeastern and southwestern United States. Entegra, Gila, and 10 other affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 14-11859) on Aug. 4, 2014. The cases are pending before the Honorable Peter J. Walsh, and the Debtors have requested that their cases be jointly administered. The Debtors have tapped Richards, Layton & Finger, P.A., as counsel, and Prime Clerk LLC as claims and notice agent. The Gila facility's direct owners are not debtors in the Chapter 11 cases, and the Gila Facility will not become property of the Debtors' estates. ENTEGRA POWER: Has Interim Authority to Use Cash Collateral ----------------------------------------------------------- Judge Peter J. Walsh of the U.S. Bankruptcy Court for the District of Delaware gave Entegra Power Group LLC, et al., interim authority to use cash collateral securing their prepetition indebtedness. Prior to the Petition Date, one or more of the Debtors entered into a credit agreement with U.S. Bank National Association as administrative agent and another credit agreement with Wells Fargo Bank, N.A., as administrative agent. Pursuant to the existing credit agreements, the Debtors were, as of the Petition Date, indebted to the second lien lenders in the aggregate principal amount of $236,903,333 and to the third lien lenders in the aggregate principal amount of $1,312,841,009. A final hearing is scheduled for Sept. 3, 2014, at 11:00 a.m. (Eastern Daylight Time). Objections are due no later than seven days prior to the final hearing. A full-text copy of the Interim Cash Collateral Order with Budget is available at http://bankrupt.com/misc/ENTEGRAcashcol0806.pdf About Entegra Power Group Entegra Power Group LLC and its affiliates operate an independent power company that owns one of the largest gas-fueled power plants in the United States, located in El Dorado, Arkansas. In addition, affiliate Gila River Energy Holdco LLC indirectly owns one-half of another of the country's largest gas-fueled power plants, in Gila Bend, Arizona. The Entegra entities market electric power from the two facilities to wholesale customers in the southeastern and southwestern United States. Entegra, Gila, and 10 other affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 14-11859) on Aug. 4, 2014. The cases are pending before the Honorable Peter J. Walsh, and the Debtors have requested that their cases be jointly administered. The Debtors have tapped Richards, Layton & Finger, P.A., as counsel, and Prime Clerk LLC as claims and notice agent. The Gila facility's direct owners are not debtors in the Chapter 11 cases, and the Gila Facility will not become property of the Debtors' estates. ENTERTAINMENT PUBLICATIONS: Saves Big With Mich. Tax Agreement -------------------------------------------------------------- Law360 reported that Charles M. Forman, the Chapter 7 trustee for Entertainment Publications LLC, proposed a settlement agreement with the Michigan Treasury over $667,000 in taxes it paid under protest before it entered bankruptcy. According to the report, the trustee proposed that coupon publisher be refunded $550,000, which will be divided between the debtor and former equity owner InterActiveCorp, which had fronted most of the tax payment in 2011, while the bankrupt company would receive $170,000. About Entertainment Publications Troy-Michigan based Entertainment Publications LLC, a producer of discount and promotion products, filed for Chapter 7 liquidation on March 12 in Delaware (Case No. 13-10496). The company was founded in 1962 by Hughes and Sheila Potiker as Sports Unlimited, selling 8,000 coupon books in the Detroit area. The company was acquired in 2008 by an affiliate of MHE Private Equity Fund LLC, which said at the time that the sale and accompanying tax benefit to seller IAC/InterActive Corp. was valued at about $135 million. The petition described the assets as worth less than $50 million with debt totaling more than $50 million. Christopher Ward, Esq., vice chairman of the bankruptcy and financial restructuring practice group at the Kansas City, Mo.- based law firm Polsinelli Shughart, represents the company. In March 2011, the company rebranded itself as Entertainment Promotions LLC, which has been its d.b.a. since then. The bankruptcy appears to be fallout between Menard and his longtime friend and former business partner in MH Equity Partners, Steve Hilbert. Hilbert was removed from control of the private equity fund. Menard wanted Hilbert out because MH Private Equity's investments have lost 70 percent of their value, according to a lawsuit filed in November 2012 in Wisconsin by Merchant Capital and Menard Inc. MH Private Equity spent $495 million to buy or invest in eight companies, including Entertainment Publications. Those investments have lost $344 million of their value since the fund was founded in 2005. EVANS & SUTHERLAND: Incurs $868,000 Net Loss in Second Quarter -------------------------------------------------------------- Evans & Sutherland Computer Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $868,000 on $5.71 million of sales for the three months ended June 27, 2014, as compared with a net loss of $425,000 on $5.21 million of sales for the three months ended June 28, 2013. For the six months ended June 27, 2014, the Company reported a net loss of $1.41 million on $12.38 million of sales as compared with a net loss of $1.78 million on $9.91 million of sales for the six months ended June 28, 2013. As of June 27, 2014, the Company had $24.23 million in total assets, $38.83 million in total liabilities and a $14.60 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/SGTyO4 About Evans & Sutherland Salt Lake City, Utah-based Evans & Sutherland Computer Corporation in conjunction with its wholly owned subsidiary, Spitz Inc., creates innovative digital planetarium systems and cutting-edge, fulldome show content. E&S has developed Digistar 5, the world's leading digital planetarium with fulldome video playback, real- time computer graphics, and a complete 3D digital astronomy package fully integrated into a single theater system. This technology allows audiences to be immersed in full-color, 3D computer-generated interactive worlds. As a full-service system provider, E&S also offers Spitz domes, hybrid planetarium systems integrated with Digistar and a full range of theater systems from audio and lighting to theater automation. E&S markets include planetariums, science centers, themed attraction venues, and premium large-format theaters. E&S products have been installed in over 1,300 theaters worldwide. For the nine months ended Sept. 27, 2013, the Company reported a net loss of $793,000 on $18.42 million of sales as compared with a net loss of $2.19 million on $17.92 million of sales for the nine months ended Sept. 28, 2012. EVERGREEN TANK: S&P Lowers CCR to 'B-' on Weak Credit Metrics ------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its corporate credit rating on Houston-based Evergreen Tank Solutions Inc. (ETS) to 'B-' from 'B'. The outlook is negative. At the same time, S&P lowered its issue-level rating on the company's $207 million senior secured term loan due 2018 one notch to 'CCC+' from 'B-'. The '5' recovery rating on the debt remains unchanged, indicating S&P's expectation for modest recovery (10%- 30%) in the event of a payment default. "The downgrade reflects ETS' weaker-than-expected operating performance in recent quarters and its continued high debt levels due to its funding of bolt-on acquisitions in 2013," said Standard & Poor's credit analyst Carol Hom. "We believe that ETS' 2014 earnings on its base business will increase only modestly as its business begins to stabilize and cash flow generation could remain insufficient to cover debt service payments." S&P revised its assessment of the company's liquidity to "less than adequate" from "adequate." The outlook is negative. S&P expects ETS' operating performance to improve modestly, but its expectation for limited free operating cash flow (FOCF) could lead to increased drawings under the revolver to fund debt service payments, which would in turn cause further pressure on liquidity. S&P could lower the rating if it believes the level and pace of improvement in the company's operating performance are not sufficient to generate FOCF to address its debt service payments in the coming quarters. S&P could revise the outlook to stable if ETS' operating prospects stabilize and improve meaningfully, such that it improves and sustains its credit metrics and it generates ample free cash flow to comfortably meet its debt service payments. FIRST MARINER: Has Exclusive Right to File Plan Until Sept. 3 ------------------------------------------------------------- Sherri Toub, substituting for Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that First Mariner BancorP won an extension of the exclusive right to propose a Chapter 11 plan. According to the report, U.S. Bankruptcy Judge David E. Rice on July 29 granted the extension request, which First Mariner says was supported by the official committee of unsecured creditors. The new plan-filing deadline is Sept. 3, the report related, citing a court order. About First Mariner Bancorp First Mariner Bancorp, the holding company for Maryland community bank 1st Mariner, filed for Chapter 11 bankruptcy on Feb. 10, 2014, in order to sell its bank subsidiary, 1st Mariner Bank, to a new bank formed by investors. The case is In re First Mariner Bancorp, Case No. 14-11952 (D. Md.) before Judge David E. Rice. The Debtor's bankruptcy counsel is Kramer Levin Naftalis & Frankel LLP. The Debtor's local counsel is Lawrence Joseph Yumkas, Esq., at Yumkas, Vidmar & Sweeney, LLC, in Annapolis, Maryland. The Debtor's regulatory and corporate counsel is Kilpatrick Townsend & Stockton LLP. The Debtor's investment banker and financial adviser is Sandler O'Neill + Partners, L.P. The Debtor has total assets of $5.45 million and total debts of $60.52 million. GRIDWAY ENERGY: Ask Court for 60-Day Exclusive Periods Extension ---------------------------------------------------------------- Gridway Energy Holdings, Inc., and its affiliates ask the Bankruptcy Court to extend their exclusive period to file a Chapter 11 plan to October 7, 2014, and exclusive period to solicit plan acceptances to December 8, 2014. Travis G. Buchanan, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilminton, Delaware, relates that in the less than four months since Gridway petitioned for Chapter 11 protection, they have been working diligently to: (a) stabilize their businesses and respond to myriad requests and inquiries from employees, vendors, taxing authorities, utility companies, and other parties-in-interest; (b) negotiate, document, and implement their debtor-in-possession financing; (c) obtain relief that has enabled them to continue operating their businesses in the ordinary course, including obtaining approval to pay certain prepetition claims of trade creditors and employees and ensure critical services are not uninterrupted; (d) prepare and file financial schedules and SOFAs for each of the 19 debtors; (e) coordinate with the U.S. Trustee and the creditors' committee to provide requested financial information and comply with the reporting requirements under the Bankruptcy Code; (f) negotiate and seek Court approval of a global settlement with creditors; (g) critically assess assets and market those assets for sale; (h) develop bid procedures for a sale of substantially all of their assets, conduct a competitive auction for the assets, and successfully consummate a sale; (i) market the remaining assets for a potential sale; (j) begin the review of their executory contracts and unexpired leases; and (k) obtain entry of an order establishing a deadline for filing proofs of claim for prepetition claims as well as administrative claims pursuant to Section 503(b) of the Bankruptcy Code. Mr. Buchanan points out that accomplishing these milestones within a mere four months has been a labor-intensive process that has fully occupied Gridway Energy's limited staff and required substantial attention from all of the professionals retained in the Chapter 11 cases. In light of the accomplishments and of the various factors considered by courts in determining whether cause exists for an extension of the exclusive periods, Gridway Energy believes that each of the factors relevant to these cases weighs in favor of the requested extension. Gridway Energy is represented by: Michael R. Nestor, Esq. Joseph M. Barry, Esq. Donald J. Bowman, Jr. , Esq. Travis G. Buchanan, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, DE 19801 Telephone: 302-571-6600 Facsimile: 302-571-1253 - and - Alan M. Noskow, Esq. Mark A. Salzberg, Esq. SQUIRE PATTON BOGGS (US) LLP 2550 M St. NW Washington, DC 20037 Telephone: 202-457-6000 Facsimile: 202-457-6315 About Gridway Energy Gridway Energy Holdings, Inc., and its affiliates, including Glacial Energy Holdings -- providers of electricity and natural gas in markets that have been restructured to permit retail competition -- sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 14-10833) on April 10, 2014. The Debtors have 200,000 electric residential customers and 55,000 gash residential customers across the U.S. A large portion of the customers' energy consumption and revenue is generated in the northeast U.S., Ohio, Illinois and Texas (collectively accounting for 80% of revenue), with the remaining portion coming from California and other states. The Debtors blamed the bankruptcy due to lower revenue brought by increased market competition, which caused the Debtors to default on certain of their obligations. Gridway defaulted on $60 million of debt. Prepetition, the Debtors negotiated a stock purchase transaction with an interested buyer. But in March 2014, the purchaser withdrew from the transaction because of the large amount of debt that the purchaser would become liable through a stock transaction. The Debtors are represented by Michael R. Nestor, Esq., Joseph M. Barry, Esq., and Donald J. Bowman, Jr., Esq., at Young Conaway Stargatt & Taylor, LLP; and Alan M. Noskow, Esq., and Mark A. Salzberg, Esq., at Patton Boggs LLP. They employed Omni Management Group, LLC, as claims and notice agent. Gridway Energy estimated assets of $500 million to $1 billion and debt of more than $1 billion. The Creditors' Committee is represented by Sharon Levine, Esq., and Philip J. Gross, Esq., at Lowenstein Sandler LLP; and Frederick B. Rosner, Esq., and Julia B. Klein, Esq., at The Rosner Law Group LLC. Vantage is represented in the case by Ingrid Bagby, Esq., David E. Kronenberg, Esq., Kenneth Irvin, Esq., and Karen Dewis, Esq., at Cadwalader, Wickersham & Taft LLP, and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A. GUAM POWER: Fitch Affirms 'BB+' Rating on $27.3MM Sub. Rev. Bonds ----------------------------------------------------------------- Fitch Ratings has assigned a 'BBB-' rating to the following revenue bonds of Guam Power Authority (GPA or the authority): -- Approximately $84,800,000 revenue bonds, 2014 series A. The series 2014 series A bonds are scheduled for negotiated sale in Sept. Bond proceeds will provide funds for GPA's capital program, fund a debt service reserve, pay capitalized interest and costs of issuance. In addition, Fitch affirms the following ratings: -- $491,1 million senior revenue bonds, 2012 series A and 2010 series A, at 'BBB-'; -- $27.3 million subordinated revenue bonds, 2010 series A, at 'BB+'. The Rating Outlook is revised to Negative from Stable. SECURITY The bonds are secured by a first lien on net revenues of GPA. Outstanding subordinated revenue bonds are limited obligations of GPA secured by a lien on, and pledge of, net revenues, subject to the prior pledge of revenues securing the senior bonds. A default on the subordinated revenue bonds would not trigger a default on the senior revenue bonds. KEY RATING DRIVERS SOLE POWER PROVIDER: GPA benefits from its position as the sole provider of retail electricity to the nearly 160,000 residents of the island of Guam, the westernmost territory of the U.S. The significant presence of the U.S. Navy, which accounts for nearly 20% of GPA's total annual revenue, provides stability to the island's economy and the authority's customer base. OUTLOOK REVISION TO NEGATIVE: The revision in Outlook reflects Fitch's concerns that the risks associated with the authority's plan to reduce its dependence on oil-fired generation through a system-wide conversion to dual-fuel generation (natural gas/oil- fired), as well as the sizable costs and related debt obligations, could weaken leverage metrics and operating flexibility to levels consistent with more speculative-grade credits. WEAK FINANCIAL PROFILE: Weak operating margins continue to generate Fitch-calculated debt service coverage of senior and subordinate lien debt and capital lease obligations of about 1.0x and provide for minimal cash reserves. Although, Fitch expects recent base rate increases coupled with a sizeable reduction in annual debt service obligations beginning in fiscal 2016 will improve financial metrics over the next several years, the authority's debt-funded capital plan is likely to increase leverage and debt service requirements over the longer term. SUBJECT TO RATE REGULATION: GPA's electric rates are regulated by the Guam Public Utility Commission (PUC), which authorizes cost recovery through both base rates and a levelized energy adjustment clause (LEAC) for fuel and other related costs. The PUC's responsiveness to requests for cost recovery in recent years is viewed favorably by Fitch, but delays inherent in both the regulatory process and the recovery mechanism will continue to impair liquidity and limit overall financial flexibility. POWER SUPPLY DIVERSIFICATION: Fitch views positively the authority's strategic energy plan, which will diversify the authority's fuel mix and facilitate compliance with environmental regulations, through a conversion to dual-fuel generation and the addition of renewable energy via purchases. Projected costs are sizeable, and the permitting process could be lengthy, but Fitch expects the plan will ultimately result in a newer, significantly more efficient generation fleet that allows for greater diversity in fuel supply. Lower projected fuel costs could also provide GPA with additional flexibility to absorb high debt service costs. LIMITED ECONOMIC PROFILE: The authority's service area exhibits weak, but improving income levels and persistently high unemployment as a result of Guam's largely tourism-based economy. Favorably, receivables have remained at a manageable level and annual bad debt expenses are consistently low. RATING SENSITIVITIES IMPLEMENTATION OF POWER SUPPLY PLAN: Fitch expects to resolve the Negative Outlook as the full impact of the proposed energy conversion plan becomes more clearly defined over the next two years. Expectations that project costs and related debt levels associated with implementing the energy plan could weaken operating and financial performance beyond what is currently forecast will likely trigger negative rating action. CREDIT PROFILE POWER SUPPLY CONVERSION The strategic efforts by the authority's management team over the next several years will be focused primarily on complying with environmental regulations imposed by the U.S. Environmental Agency (EPA). The authority is in the early stages of gaining the necessary regulatory approvals needed to execute its resource implementation plan, which includes the installation of new generation units, retiring older generating units and ultimately converting to liquefied natural gas (LNG) as a primary fuel source. The expected cost is sizeable, estimated to be $691 million, although the conversion to dual-fuel generation as well as the planned addition of renewable sources of power supply will eventually provide for greater fuel diversification and effectively satisfy the EPA's maximum achievable control technology (MACT) standards. The authority expects to rely significantly on debt issuance to fund the vast majority of the associated costs. Fitch expects debt service costs will rise considerably as a result, although the full impact of the additional debt will not occur until beyond the authority's current financial forecast period of 2014-2018. Fitch remains concerned that net operating margins beyond fiscal 2018 will begin to compress as the vast majority of debt issued in support of the energy conversion plan begins amortizing. ISLAND UTILITY SYSTEM Guam is the westernmost territory of the U.S., located approximately 3,800 miles southwest of Honolulu, HI, and almost 1,600 miles southeast of Tokyo, Japan. The island's population grew by a nominal 3% over the prior decade, reaching an estimated 159,350, according to the 2010 U.S. Census. GPA provides electric generation, transmission, and distribution service on a retail basis to a largely residential service territory anchored by the U.S. military. Customers are served primarily through owned generation, and to a lesser extent through three energy agreements with independent power producers (IPPs). Owned generating resources of the authority totaling 357.4 MW consist of three oil-fired steam generating units, four combustion turbine units, and 14 diesel units. Total available capacity is twice the system's record peak demand and well in excess of projected future demand. WEAK FINANCIAL PROFILE The authority's already weak financial metrics diminished somewhat in fiscals 2012 and 2013 after a short-term gain in fiscal 2011. A decline in energy sales coupled with a sizeable increase in debt service costs reduced Fitch calculated debt service coverage to just below 1.0x in both years. Unrestricted cash also declined in recent years, dropping from 30 days of operating cash on hand in fiscal 2011 to just 17 days over the prior two years; however, the inclusion of restricted working capital funds improves the ratio to about 45 days. GPA's financial forecast through fiscal 2018 shows Fitch calculated debt service coverage increasing over the next three fiscal years before leveling off at about 1.3x. The forecast conservatively assumes that rates are held constant, sales remain flat, and no impact from a planned military build-up. GPA's projections also assume all energy conversion projects are financed on the authority's balance sheet. Longer term projections are not available. TOURISM-BASED ECONOMY Guam receives over 1 million visitor arrivals annually, the majority of which are from Japan. Tourism and the U.S. military are the primary contributors to Guam's economy, accounting for slightly more than half of the island's employment opportunities. The previously anticipated relocation of nearly 5,000 U.S. Marines from a base in Okinawa to Guam is reportedly proceeding following a protracted delay. The increase in military personnel, while smaller than previously expected, is still viewed positively by Fitch, as nearly all related infrastructure costs are expected to be borne by the U.S. Navy. The island's unemployment rate has declined from almost 15% midway through 2013 to about 10% based on the latest data available. Similar to all U.S. Territories, wealth indicators rank significantly lower than those of the U.S., although Guam's median household income is significantly higher than its island peers. GUAM POWER: Moody's Affirms Ba1 Rating on Sub. Revenue Bonds ------------------------------------------------------------ Moody's Investors Service has assigned a Baa3 rating to the 2014 Series A Bonds to be issued by Guam Power Authority (GPA). At the same time, Moody's affirmed the ratings of the existing senior revenue bonds at Baa3 and subordinated revenue bonds at Ba1. The rating outlook for GPA has been revised to positive from stable. Issue: Guam Power Authority Revenue Bonds, 2014 Series A Rating: Baa3 Sale Amount: $84,791,121 Expected Sale Date: 08-11-2014 Rating Description: Revenue:Other Summary Rating Rationale: The Baa3 rating of Guam Power Authority (GPA)'s to be issued 2014 Series A Revenue Bonds and the existing Bonds reflects GPA's monopoly status as the sole provider of electricity to a fairly diversified customer base comprising residential, business and government customers including both the Government of Guam as well as the United States Navy. The rating reflects consistent and solid financial performance as measured by debt service coverage levels and liquidity held in the form of days cash on hand, approval of multi-year rate increase requests and the long term power supply contract with the U.S. Navy, GPA's largest customer. The presence of and the continued expansion of Guam's U.S. military presence is a stabilizing factor and reflects the strategic importance of the island. GPA continues to develop its fuel diversification plan, which is also expected to address environmental compliance issues. The rating however is tempered by Guam's reliance on tourism and the US Navy, GPA's 100% reliance on fuel oil based generation and uncertainty around EPA's view on GPA's consent decree requests. Outlook The rating outlook is positive, reflecting the certainty of rates over the next few years as well as GPA's consistent operational and financial profile. The outlook also incorporates current GPA's expectations that the fuel diversification plan will satisfy EPA's requirements and will be implemented in a manner that is amenable to EPA. What Could Change the Rating UP The rating could face upward pressure with more clarity around GPA's EPA compliance and LNG strategy, and also as GPA's resource mix gains greater diversity. Continued growth in the economy fueled by tourism resulting in sustained improvements in the financial profile will also contribute to a rating upgrade. What Could Change the Rating DOWN In light of the positive rating outlook, limited near-term prospects exist for the rating to be downgraded. The rating could face downward pressure if GPA's financial profile deteriorates such that debt service coverage, inclusive of all debt and lease obligations, falls below 1.2x as calculated by Moody's on a consistent basis. Additionally, downward pressure may be placed on the rating if GPA's fuel diversification plan does not meet EPA's requirements. Strengths -- Monopoly service provider of essential service -- Growing residential customer base -- Demonstrated willingness and ability to raise rates -- Expanding Guam economy Challenges -- Lack of fuel diversity -- Declining electricity sales -- Clarity around implementation of LNG strategy and meeting EPA regulations The principal methodology used in this rating was U.S. Public Power Electric Utilities with Generation Ownership Exposure published in November 2011. HAAS ENVIRONMENTAL: Files Reorganization Plan, Faces Objections --------------------------------------------------------------- The Official Committee of Unsecured Creditors of Haas Environmental Inc., Santander Bank, N.A., and Ford Motor Credit Company LLC filed with the U.S. Bankruptcy Court for the District of New Jersey objections to the disclosure statement describing the Debtor's proposed Plan of Reorganization. A copy of the Disclosure Statement is available for free at: http://is.gd/Y5CJlo The Disclosure Statement filed by the Debtor on May 27, 2014, says that the Debtor seeks to accomplish payments by providing payments to creditors from (a) cash on hand on the effective date; (b) funds held in escrow by Sherman Silverstein prior to the effective date; (c) the new value contribution; (d) net proceeds of the sale of the inventory; (e) net proceeds of the sale of the Steubenville property; and (f) proceeds from causes of action. The Debtor will fund its ongoing operations and all payments to holders of Class 1-5 claims from funds in its possession on and after the effective date. Payments to Class 6 will be made by sole shareholder Eugene Haas from his personal funds. Payments on account of allowed professional claims, allowed priority tax claim, allowed Class 7 claims, and allowed Class 8 claims will be made from a plan payment fund. Distributions to allowed professional claims, allowed priority tax claims, allowed Class 7 claims, and allowed Class 8 claims will be made in this order: a. payment, in full, of all allowed professional claims; b. payment, in full, of all allowed priority tax claims; c. payment, in full, of all allowed class 7 claims; and d. distributions on account of allowed class 8 claims. If the plan payment fund doesn't contain sufficient funds to make distributions to satisfy allowed professional claims, the Debtor or reorganized debtor will provide an amount equal to the lesser of $60,000 or the remaining balance owed on account of allowed professional claims on each of Aug. 15, 2014, Oct. 15, 2014, and Dec. 15, 2014, which funds will be used solely for the payment of allowed professional claims. The Debtor or reorganized debtor will be reimbursed any amount that it contributes to the plan payment fund upon availability of funds in the plan payment fund. Upon the effective date, Mr. Haas will be deemed appointed as the plan administrator and will be responsible for making distributions from the play payment fund under the Plan. Management of the Debtor's operations after the effective date will continue to be run by Mr. Haas as its president. The effective date of the proposed Plan is: (a) 14 days after entry of the confirmation order; (b) the date the plan administrator executes the plan administrator agreement; and (c) the date the new value contribution is deposited with Sherman Silverstein. A hearing for the Court to consider the approval of the Disclosure Statement was set for July 10, 2014, at 2:00 p.m. Committee's Objection The Committee claims in a court filing dated June 26, 2014, that the Plan's distribution scheme violates the absolute priority rule as it impermissibly delivers all of the equity of the reorganized debtor to the Debtor's sole equity interest holder, without providing payment in full to holders of senior classes of impaired claims. The Debtor, says the Committee, cannot avail itself of the "new value" exception to the absolute priority rule because the proposed "new value" contribution is woefully inadequate and the Debtor failed to test the adequacy of the "new value" contribution against the market. The Committee's objection states that the Plan also contains inappropriate provisions that are highly prejudicial to the interests of the Debtor's estate and creditors, like the broad third-party releases by the Debtor's estate in favor of the Debtor's sole equity interest holder and other insiders. The Committee adds, "The Disclosure Statement is completely silent as to any basis for the inclusion in the Plan of broad third-party releases in favor of the Debtor's sole Equity Interest Holder and various other insiders. These proposed releases warrant particular scrutiny by the Court as there is no consideration, much less fair consideration, being provided by the proposed beneficiaries of these third-party releases. Furthermore, many of the proposed beneficiaries of the third-party releases are the same exact parties who were recipients of significant and substantial prepetition transfers, which the Committee believes were fraudulent transfers and/or preferential payments." A copy of the objection is available for free at: http://is.gd/a1nMsK Santander's Objection Santander states in its objection filed on June 26, 2014, that the Plan unfairly discriminates against Santander, is not fair and equitable with respect to Santander, is not feasible, contains impermissible third-party releases and violates the absolute priority rule by not exposing Debtor's equity interests to the market. Santander says that the Disclosure Statement fails to provide any disclosure concerning (i) the Santander Judgment; (ii) the Debtor's identification and proposed treatment of the Santander collateral; (iii) the value of the Debtor's property -- including the Santander Collateral -- to be used by the reorganized Debtor post-bankruptcy; and (iv) the method or analysis by which Debtor seeks to reduce the Santander Secured Debt to $48,000. Santander complains that Exhibit "F" to the Disclosure Statement is the Debtor's Chapter 7 liquidation analysis, which lists Santander as holding an "$83,000 Third Position Lien against Debtor's Cash and Accounts Receivable". That value, Santander states, is inconsistent with other sections of the Disclosure Statement. As of June 24, 2014, Debtor owes Santander $817,946.30, exclusive of attorneys' fees and other costs. The Santander Secured Debt is secured by a perfected UCC-1 lien all assets of the Debtor, whether presently owned or later acquired, including all cash and non-cash proceeds. The Debtor's sole shareholder, Eugene Haas, among other non-debtor guarantors, has guaranteed the Santander Secured Debt. Santander holds a judgment entered by the Superior Court of New Jersey against Eugene Haas, Kimberly Haas and Shale Solutions, LLC, for their failure to repay the Santander Secured Debt. A copy of the objection is available for free at: http://is.gd/8sVJp9 Ford Motor Credit's Objection On June 5, 2014, Ford Motor Credit Company LLC, holder of a first purchase money security interest encumbering a number of vehicles owned by the Debtor, filed with the Court an objection to the Plan and the Disclosure Statement, claiming that they do not precisely state how Ford Motor Credit will be paid after confirmation. Ford Motor Credit's loans are cross collateralized. "The Disclosure Statement and Plan do not refer to that and should. The Plan should refer to the fact that Ford Credit will retain its liens on all vehicles it financed after confirmation. The Plan and Disclosure Statement should be amended to reflect that Ford Credit will be paid the contract rate of interest set forth on each retail installment contract secured by the vehicle it financed," Ford Motor Credit says. The loans encumbering the vehicles are in default both pre-petition and post-petition. Ford Motor Credit claims that the Disclosure Statement does not address how pre-petition arrears will be cured. A copy of the objection is available for free at: http://is.gd/v6NwR7 About Haas Environmental, Inc. Haas Environmental, Inc., filed a Chapter 11 petition (Bankr. D.N.J. Case No. 13-27297) on Aug. 6, 2013. Eugene Haas signed the petition as president. Judge Kathryn C. Ferguson presides over the case. The Debtor disclosed $10,127,069 in assets and $11,595,611 in liabilities as of the Chapter 11 filing. The Debtor is represented by: SHERMAN, SILVERSTEIN, KOHL, ROSE & PODOLSKY, P.A. Arthur J. Abramowitz, Esq. Jerrold N. Poslusny, Jr., Esq. 308 Harper Drive, Suite 200 Moorestown, NJ 08057 Tel: (856) 662-0700 Mary E. Seymour, Esq., at Lowenstein Sandler LLP, serves as counsel for the Official Committee of Unsecured Creditors. EisnerAmper LLP serves as its financial advisor. HOSTESS BRANDS: Notifies Court of Address Change ------------------------------------------------ Old HB, Inc., et al., formerly known as Hostess Brands, Inc., and its affiliated debtors notify the Bankruptcy Court of their address change. Corinne Ball, Esq., at Jones Day, in New York, says that all notices given or required to be given and papers served or required to be served to or on Old HB in the Chapter 11 cases should now be given and served at: Old HB, Inc. 3101 Mercier Street, Suite 422 Kansas City, MO 64111 Old HB is represented by: Lisa G. Laukitis, Esq. David G. Marks, Esq. JONES DAY 222 East 41st Street New York, NY 10017 Telephone: (212) 326-3939 Facsimile: (212) 755-7306 - and - Ryan T. Routh, Esq. JONES DAY North Point 901 Lakeside Avenue Cleveland, OH 44114 Telephone: (216) 586-3939 Facsimile: (216) 579-0212 About Hostess Brands Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known for iconic brands such as Butternut, Ding Dongs, Dolly Madison, Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride, Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution centers and 570 outlets in 49 states. Hostess filed for Chapter 11 bankruptcy protection early morning on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through 12-22056) in White Plains, New York. Hostess Brands disclosed assets of $982 million and liabilities of $1.43 billion as of the Chapter 11 filing. The bankruptcy filing was made two years after predecessors Interstate Bakeries Corp. and its affiliates emerged from bankruptcy (Bankr. W.D. Mo. Case No. 04-45814). In the new Chapter 11 case, Hostess has hired Jones Day as bankruptcy counsel; Stinson Morrison Hecker LLP as general corporate counsel and conflicts counsel; Perella Weinberg Partners LP as investment bankers, FTI Consulting, Inc. to provide an interim treasurer and additional personnel for the Debtors, and Kurtzman Carson Consultants LLC as administrative agent. Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry Wilson, the head of turnaround and restructuring firm MAEVA Advisors, are representing the Teamsters union. Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and Bakery & Confectionery Union & Industry International Pension Fund are Jeffrey R. Freund, Esq., at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright & Jaworski L.L.P. The official committee of unsecured creditors selected New York law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom Mayer and Ken Eckstein head the legal team for the committee. Hostess Brands in mid-November 2012 opted to pursue the orderly wind down of its business and sale of its assets after the Bakery, Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a nationwide strike. The Debtor failed to reach an agreement with BCTGM on contract changes. Hostess Brands sold its businesses and most of the plants to five different buyers for an aggregate of $860 million. Hostess still has some plants, depots and other facilities the buyers didn't acquire. The bankruptcy estate has changed its name to Old HB Inc. HOUSTON REGIONAL: AT&T, DirecTV to Acquire CSN Houston Under Plan ----------------------------------------------------------------- David Barron, writing for The Houston Chronicle, reported that AT&T and DirecTV Sports Networks apparently will become the sole owners of Comcast SportsNet Houston under a plan of reorganization filed late Wednesday night with federal bankruptcy court. The report noted that the Plan was filed about 12 hours before a 10 a.m. status conference on Aug. 7 before U.S. Bankruptcy Judge Marvin Isgur. According to the report, an investment agreement involving AT&T, DirecTV Sports Networks, the Astros and Rockets and signed by Astros owner Jim Crane and Rockets CEO Tad Brown, provides that the Houston Regional Sports Network partnership will be reorganized as a limited liability company with 1,000 common shares -- 40 percent to AT&T, 60 percent to DirecTV Sports Networks. Those shares will represent "the totally outstanding equity interest of HRSN" and interests of HRSN owned by the teams and Comcast "shall be irrevocably canceled and terminated." According to the report, in a statement Thursday morning, the companies said, "The Houston Regional Sports Network, along with the Houston Astros and Houston Rockets, filed with the U.S. Bankruptcy Court in Houston a proposal to transfer ownership to a joint venture between DIRECTV and AT&T. Once the proposal is voted on by the creditors and approved by the court, DIRECTV and AT&T look forward to providing this great sports programming to Astros and Rockets fans throughout the region." 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. IMPERIAL METALS: S&P Cuts Rating to 'CCC+' Over Tailings Breach --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Vancouver-based Imperial Metals Corp., to 'CCC+' from 'B-' following the breach of the company's tailings storage facility at its Mount Polley mine in British Columbia. The outlook is negative. Standard & Poor's has also lowered its issue-level rating on the company's senior unsecured debt to 'CCC+' from 'B-'. The recovery rating on the company's senior unsecured notes is unchanged at '4', which corresponds with average (30%-50%) recovery in S&P's simulated default scenario. "The downgrade of Imperial Metals follows the breach of the company's tailings storage facility at its Mount Polley mine in British Columbia, which we believe will have a serious negative effect on the company's cash flow and liquidity," said Standard & Poor's credit analyst Jarrett Bilous. "The cause of the breach is unknown and the mine has been placed on care and maintenance," Mr. Bilous added. Mount Polley accounts for the majority of the company's production and cash flow generation; based on the scope of the breach, S&P believes there is a high likelihood that the company's cash flow generation will be materially impacted by downtime at Mount Polley. At this point, there is no indication as to when operations will be restored, or the potential costs associated with breach remediation (including environmental clean-up). As a result, S&P views the company as vulnerable and dependent on favorable business, financial, and economic conditions to meet its financial commitments, which is consistent with S&P's criteria for issuers it rates 'CCC+'. The negative outlook reflects the possibility of a downgrade if Imperial Metals' liquidity risk escalates, which could result from costs related to breach remediation, ongoing capital expenditures for Red Chris, a prolonged outage of the company's Mount Polley mine, or reduced access to credit facilities. S&P could lower the rating in the event that estimated uses of liquidity exceed sources over the next 12 months, which is consistent with a "weak" liquidity assessment as defined by Standard & Poor's. In addition, a material delay in the development of the company's Red Chris mine, which is expected to generate significant cash flow in 2015, could also lead to a downgrade. A positive rating action could result from improved liquidity, which S&P assumes would coincide with the restart of Mount Polley prior to year-end 2014, cash generation from Red Chris in 2014 or 2015, or access to sufficient external funds available to cover breach-related costs. Even if Mount Polley returns to production and cash flow in 2014, S&P believes that it may not improve liquidity, considering the repair and remediation costs for the tailings facility. INTERNATIONAL MANUFACTURING: Can Use Cash Collateral Thru Oct. 24 ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of California approved a motion filed by Beverly N. McFarland, Chapter 11 trustee of International Manufacturing Group, Inc., to use cash collateral of IMG Funding, LLC, during the period retroactive to June 24, 2014, through and including Oct. 26, 2014. The Trustee is further authorized to spend in the aggregate up to (10%) variance from the gross amount sought to be expended in the prepared budget during the Cash Collateral period for actual and necessary costs and expenses that must be expended to preserve the assets of the estate including any out-of-pocket expenses incurred by the Trustee in operating the Debtor's business. As reported in the July 18, 2014 edition of The Troubled Company Reporter, the Chapter 11 Trustee wants to use all proceeds from the Debtor's business selling and distributing medical supplies to dentists and to tattoo artists under the dba RelyAid located in West Sacramento up to the amount of $250,000 per month on the actual and necessary costs of operating the Business including any out-of-pocket expenses incurred by the Chapter 11 Trustee in operating the Business, or such higher amounts as reasonably required to maintain the operations of the Business if approved by IMG Funding. In exchange for using the cash collateral, the Chapter 11 Trustee proposed to grant IMG a replacement lien on any and all assets of the Debtor of the same kind and character and to the same extent, validity and priority as IMG's prepetition lien on the Debtor's assets nunc pro tunc to the Chapter 11 Trustee selection date. About International Manufacturing Deepal Wannakuwatte, the mastermind of a $150 million Ponzi scheme, put himself and his company, International Manufacturing Group Inc., into Chapter 11 after he pleaded guilty to one count of wire fraud and agreed to a 20-year prison sentence. The bankruptcy filing was part of his plea bargain with federal prosecutors. Mr. Wannakuwatte is the former owner of the Sacramento Capitols tennis team. International Manufacturing Group, Inc., filed a bare-bones Chapter 11 bankruptcy petition (Bankr. E.D. Cal. Case No. 14-25820) in Sacramento, on May 30, 2014. The case is assigned to Judge Robert S. Bardwil. The Debtor has tapped Marc A. Caraska, in Sacramento, as counsel. In June 2014, Beverly N. McFarland was appointed as Chapter 11 trustee for the Debtor. She has tapped Felderstein Fitzgerald Willoughby & Pascuzzi LLP as her bankruptcy counsel; Diamond McCarthy LLP as her special litigation counsel; Gabrielson & Company as accountant; and Karen Rushing as bookkeeper outside the ordinary course of business. According to the docket, governmental entities have until Nov. 26, 2014, to file claims. The U.S. Trustee for Region 7 appointed a three-member unsecured creditors panel comprising of Byron Younger, Janine Jones, and Steve Whitesides. JOHN D. OIL: Allowed to Pay $6-Mil. to RBS Citizens Until Aug. 14 ----------------------------------------------------------------- U.S. Bankruptcy Judge Thomas Agresti signed an order extending the deadline for payment of $6 million to RBS Citizens N.A. to August 14. John D. Oil & Gas Co., Oz Gas LTD., Great Plains Exploration LLC and the Richard M. Osborne Trust are required under a settlement agreement they previously made with RBS Citizens to pay $6 million. The companies and the trust, however, failed to make the payment before the July 30 deadline. About John D. Oil & Gas Co. Mentor, Ohio-based John D. Oil & Gas Co., is in the business of acquiring, exploring, developing, and producing oil and natural gas in Northeast Ohio. The Company has 58 producing wells. The Company also has one self storage facility located in Painesville, Ohio. The self-storage facility is operated through a partnership agreement between Liberty Self-Stor Ltd. and the Company. John D. Oil's affiliated entities -- Oz Gas, LTD., and Great Plains Exploration, LLC -- filed voluntary Chapter 11 petitions (Bankr. W.D. Pa. Case Nos. 12-10057 and 12-10058) on Jan. 11, 2012. Two days later, John D. Oil filed its own Chapter 11 petition (Bankr. W.D. Pa. Case No. 12-10063). On Nov. 21, 2011, at the request of the lender RBS Citizens, N.A., dba Charter One, a receiver was appointed for all three corporate Debtors, in the United States District Court for the Northern District of Ohio at case No. 11-cv-2089-CAB. District Judge Christopher A. Boyko issued an order appointing Mark E. Dottore as receiver. The Receivership Order was appealed to the Sixth Circuit Court of Appeals on Dec. 19, 2011, and the appeal is currently pending. Judge Thomas P. Agresti oversees the Chapter 11 cases. Robert S. Bernstein, Esq., at Bernstein Law Firm P.C., serves as counsel to the Debtors. Each of Great Plains and Oz Gas estimated $10 million to $50 million in assets and debts. John D. Oil's balance sheet at Dec. 31, 2011, showed $6.98 million in total assets, $13.26 million in total liabilities, and a stockholders' deficit of $6.28 million. The petitions were signed by Richard M. Osborne, CEO. The United States Trustee said a committee under 11 U.S.C. Sec. 1102 has not been appointed because no unsecured creditor responded to the U.S. Trustee's communication for service on the committee. KID BRANDS: Reaches Accord with Creditors Over $49M DIP Loan ------------------------------------------------------------ Law360 reported that Kid Brands Inc. has reached an agreement with the Official Committee of Unsecured Creditors to resolve the panel's objection to its proposed $49 million in debtor-in- possession financing package. According to Law360, citing an attorney for the Creditors' Committee, the arrangement with the debtors and lender Salus Capital Partners LLP provides for the creation of a trust for the benefit of general unsecured creditors and allows creditors to participate in the recovery from certain litigation claims that belong to the estate. About Kid Brands Based in Rutherford, New Jersey, Kid Brands, Inc., is a designer, importer, marketer, and distributor of infant and juvenile consumer products. Its operating subsidiaries consist of Kids Line, LLC, CoCaLo, Inc., Sassy, Inc., and LaJobi, Inc. Providing "everything but the baby" for a child's nursery, the company sells infant bedding and accessories under the Kids Line and CoCaLo brands; nursery furniture under the LaJobi brand; and baby care items under the Kokopax and Sassy brands. Citing their inability to raise capital due to contingent liabilities and operational issues, Kid Brands and six of its U.S. subsidiaries each filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 14-22582) on June 18, 2014. To preserve the value of their assets, the Debtors are pursuing a sale of the assets pursuant to section 363 of the Bankruptcy Code. As of April 30, 2014, the Debtors had $32.40 million in total assets and $109.1 million in total liabilities. As of the Petition Date, unsecured debts totaled $54 million. Judge Donald H. Steckroth oversees the cases. The Debtors have sought and obtained an order directing joint administration of their Chapter 11 cases. Lowenstein Sandler LLP serves as the Debtors' counsel. PricewaterhouseCoopers LLP is the Debtors' financial advisor. GRL Capital Advisors acts as the Debtors' restructuring advisors. GRL's Glenn Langberg served as the Debtors' chief restructuring officer. Mr. Langberg also oversaw the bankruptcy and sales of Big M Inc., operator of the Mandee and Annie Sez stores. Rust Consulting/Omni Bankruptcy is the Debtors' claims and noticing agent. Salus Capital Partners LLC and Sterling National Bank have committed to provide up to $49 million in DIP financing to the Debtors. LEHMAN BROTHERS: Arbitrators Ease Blame on Auditors --------------------------------------------------- Matthew Goldstein, writing for The New York Times' DealBook, reported that an arbitration panel composed of three former judges has found that there is no basis for a malpractice claim against Ernst & Young, the big accounting firm that audited Lehman's books. According to the report, the panel ruled that it was Lehman's management, not Ernst, that was most responsible for setting in motion and maintaining a controversial accounting maneuver that allowed the firm to temporarily move tens of billions of dollars in debt off its balance sheet at the end of every quarter. According to the DealBook, the arbitration ruling could also rekindle debate about the Securities and Exchange Commission's decision not to pursue an enforcement action against Lehman or any of its former executives over the accounting maneuver, known as Repo 105. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI. The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHR CONSTRUCTION: Trustee Resolves Dispute With Coffeys -------------------------------------------------------- Lehr Construction Corp.'s bankruptcy trustee won court approval for a deal that would resolve his dispute with Frederick and Margaret Coffey. Under the deal, Lehr Construction will receive payment of $470,000 from the Coffeys, down from the $3 million claim it originally wanted. Both sides also agreed to a mutual release of claims. A full-text copy of the settlement agreement is available without charge at http://is.gd/KlNJyy About Lehr Construction New York-based Lehr Construction Corp. was founded in 1979. It specializes in interior construction and serves clients mainly throughout the New York metropolitan area. It serves as construction manager and general contractor for its clients Lehr filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 11-10723) on Feb. 21, 2011. James A. Beldner, Esq., at Cooley LLP, serves as the Debtor's bankruptcy counsel. The Debtor estimated its assets and debts at $10 million to $50 million. Rust Consulting/Omni Claims Agent serves as claims and noticing agent. Jonathan Flaxer is the Chapter 11 Trustee for Lehr Construction. He is represented by Douglas L. Furth, Esq., at Goldenbock Eiseman Assor Bell & Peskoe LLP, in New York. Wolf Haldenstein Adler Freeman & Hertz serves as conflicts counsel to the trustee. Marotta Gund Budd & Dzera, LLC, serves as trustee's financial advisor. Tracy Hope Davis, the U.S. Trustee for Region 2, appointed five creditors to serve on the Official Committee of Unsecured Creditors in the Debtor's case. Fred Stevens at Klestadt & Winters, LLP represents the Committee. LIGHTSQUARED INC: Fights GPS Makers' Bid to Toss Contract Suit -------------------------------------------------------------- Law360 reported that LightSquared Inc. blasted Garmin International Inc. and other GPS companies' bid to nix the wireless startup's contract suit over spectrum usage, saying in New York court that their motion to dismiss should be rejected since it relies on factual disputes that can't be resolved at the pleading stage. According to the report, Garmin, Deere & Co., Trimble Navigation Ltd., the U.S. GPS Industry Council and the Coalition to Save Our GPS urged a New York federal judge to toss the complaint in May, contending LightSquared's allegations that they breached contract and withheld crucial spectrum-usage information are easily refuted by the text of the agreements. The case is LightSquared Inc. et al v. Deere & Company et al., Case No. 1:13-cv-08157 (S.D.N.Y.). About LightSquared Inc. LightSquared Inc. and 19 of its affiliates filed Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No. 12-12080) on May 14, 2012, to resolve regulatory issues that have prevented it from building its coast-to-coast integrated satellite 4G wireless network. LightSquared had invested more than $4 billion to deploy an integrated satellite-terrestrial network. In February 2012, however, the U.S. Federal Communications Commission told LightSquared the agency would revoke a license to build out the network as it would interfere with global positioning systems used by the military and various industries. In March 2012, the Company's partner, Sprint, canceled a master services agreement. LightSquared's lenders deemed the termination of the Sprint agreement would trigger cross-defaults under LightSquared's prepetition credit agreements. LightSquared and its prepetition lenders attempted to negotiate a global restructuring that would provide LightSquared with liquidity and runway necessary to resolve its issues with the FCC. Despite working diligently and in good faith, however, LightSquared and the lenders were not able to consummate a global restructuring on terms acceptable to all interested parties. Lawyers at Milbank, Tweed, Hadley & McCloy LLP serve as counsel to the Debtors. Alvarez & Marsal North America, LLC, is the financial advisor. Kurtzman Carson Consultants LLC serves as claims and notice agent. LYONDELL CHEMICAL: Shareholders Try to Ax $12.5B Clawback Row ------------------------------------------------------------- Law360 reported that shareholders in Lyondell Chemical Co. urged a New York bankruptcy court to toss adversary suits launched by creditors trying to claw back a $12.5 billion payout that the shareholders received when Lyondell was purchased in 2007 by Luxembourg conglomerate Basell AF SCA in a leveraged buyout. According to the report, in a memorandum supporting their motion to dismiss, the shareholders maintained that a trio of amended adversary suits filed in April alleging the payout was an intentional fraudulent transfer still were insufficiently pled. About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. Luxembourg-based Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. Len Blavatnik's Access Industries owned the Company prior to its bankruptcy filing. On Jan. 6, 2009, LyondellBasell Industries' U.S. operations, led by Lyondell Chemical Co., and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities filed for Chapter 11. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 protection on April 24, 2009. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, served as the Debtors' bankruptcy counsel. Evercore Partners served as financial advisors, and Alix Partners and its subsidiary AP Services LLC, served as restructuring advisors. AlixPartners' Kevin M. McShea acted as the Debtors' Chief Restructuring Officer. Clifford Chance LLP served as restructuring advisors to the European entities. LyondellBasell emerged from Chapter 11 bankruptcy protection in May 2010, with a plan that provides the Company with US$3 billion of opening liquidity. A new parent company, LyondellBasell Industries N.V., incorporated in the Netherlands, is the successor of the former parent company, LyondellBasell Industries AF S.C.A., a Luxembourg company that is no longer part of LyondellBasell. LyondellBasell Industries N.V. owns and operates substantially the same businesses as the previous parent company, including subsidiaries that were not involved in the bankruptcy cases. LyondellBasell's corporate seat is Rotterdam, Netherlands, with administrative offices in Houston and Rotterdam. MARRIOTT VACATIONS: S&P Raises CCR to 'BB'; Outlook Stable ---------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on Marriott Vacations Worldwide Corp. (MVW) to 'BB' from 'BB-'. The outlook is stable. The upgrade reflects S&P's view that MVW can sustain average consolidated gross debt to EBITDA of about 3x, notwithstanding its share repurchase program and the potential for a moderate level of opportunistic acquisitions--both of which MVW could partly fund using existing cash balances and expected levels of free cash flow. MVW is also likely to sustain EBITDA coverage of interest expense at more than 5x through 2015. These measures are good for S&P's "significant" financial risk profile assessment. Although the warehouse and term securitization debt are nonrecourse to MVW, we include them and about $70 million in operating leases and $40 million in preferred stock in our leverage measure. In addition, S&P believes that MVW intends to pursue a relatively measured pace of sales growth, and it is not likely to meaningfully increase the percentage of timeshare sales that are financed. As a result, S&P believes that the company's financing operations are unlikely to result in an increase in consolidated leverage over the next few years. In addition to its good consolidated leverage profile for our "significant" financial risk profile assessment, the upgrade also reflects MVW's strong liquidity and brand in the timeshare industry, which compare favorably to its peers'. S&P's stable rating outlook reflects its expectation for leverage in the 3x area and EBITDA coverage of interest expense in the 5x area through 2015 -- levels S&P considers good for the "significant" financial risk profile assessment. The stable outlook also reflects the company's "strong" liquidity profile. "We also believe that MVW intends to pursue a relatively measured pace of sales growth, and that management views its good access to external financing sources as a strategic advantage," said Standard & Poor's credit analyst Emile Courtney. "Although growth opportunities will arise and external financing needs may increase from time to time, we believe that MVW's policy is to manage consolidated leverage at about 3x, in line with the current financial risk profile assessment and rating." S&P could lower the rating as a result of significant acquisitions and other investments. S&P could also downgrade the rating if MVW pursues a more rapid pace of resort development and sales growth that would require higher levels of external financing than S&P expects, in a manner that sustains total consolidated debt to EBITDA above the 3x area. Although unlikely because of the company's growth focus and share repurchase activity, S&P could upgrade MVW if it believes the company can sustain leverage in the 2x area. MCCLATCHY CO: Reports Second Quarter Revenue of $292 Million ------------------------------------------------------------ The McClatchy Company filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $89.94 million on $291.95 million of net revenues for the quarter ended June 29, 2014, as compared with net income of $11.75 million on $301.60 million of net revenues for the quarter ended June 30, 2013. For the six months ended June 29, 2014, the Company reported net income of $74.10 million on $572.62 million of net revenues as compared with a net loss of $989,000 on $590.24 million of net revenues for the six months ended June 30, 2013. The Company's balance sheet at June 29, 2014, showed $2.68 billion in total assets, $2.36 billion in total liabilities and $318.93 million in stockholders' equity. The Company's cash and cash equivalents were $265.3 million as of June 29, 2014, compared to $21.8 million of cash at June 30, 2013, and $80.8 million as of Dec. 29, 2013. The increase in cash and cash equivalents in the quarter ended June 29, 2014, compared to the same period in 2013 and Dec. 29, 2013, is primarily due to $146.9 million cash distribution from Classified Ventures, LLC, which is equal to our share of the proceeds from their sale of Apartments.com business and the $34 million in cash proceeds received from the sale of Anchorage. A full-text copy of the Form 10-Q is available for free at: http://is.gd/YJhnvV About The McClatchy Company Sacramento, Cal.-based The McClatchy Company (NYSE: MNI) -- http://www.mcclatchy.com/-- is the third largest newspaper company in the United States, publishing 30 daily newspapers, 43 non-dailies, and direct marketing and direct mail operations. McClatchy also operates leading local Web sites in each of its markets which extend its audience reach. The Web sites offer users comprehensive news and information, advertising, e-commerce and other services. Together with its newspapers and direct marketing products, these interactive operations make McClatchy the leading local media company in each of its premium high growth markets. McClatchy-owned newspapers include The Miami Herald, The Sacramento Bee, the Fort Worth Star-Telegram, The Kansas City Star, The Charlotte Observer, and The News & Observer (Raleigh). The Company reported net income of $18.80 million for the year ended Dec. 29, 2013, as compared with a net loss of $144,000 for the year ended Dec. 30, 2012. * * * McClatchy carries a 'Caa1' corporate family rating from Moody's Investors Service. In May 2011, Moody's changed the rating outlook from stable to positive following the company's announcement that it closed on the sale of land in Miami for $236 million. The outlook change reflects Moody's expectation that McClatchy will utilize the net proceeds to reduce debt, including its underfunded pension position, which will reduce leverage by approximately half a turn and lower required contributions to the pension plan over the next few years. McClatchy Co. carries a 'B-' Corporate Credit Rating from Standard & Poor's Ratings Services. As reported by the TCR on April 2, 2014, Standard & Poor's Ratings Services affirmed all ratings on U.S. newspaper company The McClatchy Co., including the 'B-' corporate credit rating, and revised the rating outlook to stable from positive. The outlook revision to stable reflects S&P's expectation that the timeframe for a potential upgrade lies beyond the next 12 months, and could also depend on the company realizing value from its digital minority interests. MEDIA GENERAL: New $75MM Add-on Loan No Impact on Moody's B1 CFR ---------------------------------------------------------------- Moody's Investors Service says that Media General, Inc.'s proposed incremental $75 million senior secured term loan does not have an immediate impact on the company's credit ratings, including the B1 Corporate Family Rating, B2-PD Probability of Default Rating, and the B1 rating on the existing 1st lien senior secured term loan. Proceeds from the incremental term loan and excess cash will be used to fund the pending $83.4 million purchase of WHTM-TV, an ABC affiliate in Harrisburg, PA from Sinclair Broadcast Group as well as transaction related fees and expenses. All other credit ratings including the SGL-2 Speculative Grade Liquidity Rating and the stable rating outlook remain unchanged as Moody's expects overall financial metrics and operating performance to remain within the B1 Corporate Family Rating. The transaction increases the 2-year average debt-to-EBITDA ratios and is expected to be in the mid 5x range pro forma for announced transactions (including Moody's standard adjustments) estimated for FYE2014. In Q1 2014, Media General and LIN Media LLC ("LIN") announced an agreement to combine the two companies in a transaction that valued LIN at approximately $2.6 billion. The acquisition of WHTM, a #2 ranked television station in the 43rd largest DMA, is in line with Media General's strategy of operating top ranked stations in mid sized markets. The acquisition adds to the company's scale as well as geographic diversity. Post closing of announced transactions, Moody's expect the company to generate good free cash flow providing the ability to repay debt, reduce leverage, and improve other financial credit metrics in the absence of additional debt financed acquisitions. The principal methodology used in this rating/analysis was Global Broadcast and Advertising Related Industries Methodology published in May 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. Media General, headquartered in Richmond, VA, is a television broadcaster and is expected to own, operate or service 75 network affiliated stations and their digital property across 47 markets covering 23% of U.S. television households, post-closing of the announced merger with LIN, the acquisition of WHTM, and certain divestitures. The company is expected to have 34 stations in the largest 75 media markets and network affiliations will include 23 CBS stations, 16 NBC, 13 ABC, 10 FOX, 7 CW, and 6 MNT. Media General is publicly traded and, as part of the LIN merger, Media General plans to form a new holding company through which existing Media General shareholders will own 64% of the new holding company with LIN shareholders owning the remaining 36%. Current owners of Media General include, Standard General, Oppenheimer, Gabelli, and Highland Capital, with the remainder being widely held. Average 2012 and 2013 revenue pro forma for announced transactions is $1.3 billion. MEDIA GENERAL: S&P Retains 'BB-' Rating Over $75MM Loan Add-On -------------------------------------------------------------- Standard & Poor's Ratings Services said that its 'BB-' issue-level rating and '2' recovery rating on Media General Inc.'s first-lien term loan B due 2020 remain unchanged following the company's plan for a $75 million add-on to the existing loan. The '2' recovery rating on the term loan B indicates S&P's expectation for substantial recovery (70%-90%) for the noteholders in the event of a default. The issue-level and recovery ratings on the first-out revolver are also unaffected. The 'BB-' issue-level rating is one notch above S&P's 'B+' corporate credit rating on the company. The company plans to use the proceeds from the add-on offering to fund its pending acquisition of WHTM-TV, the ABC affiliated station in Harrisburg, Pa. from Sinclair Broadcast Group Inc. Pro forma for the debt issuance and the WHTM-TV acquisition, debt to trailing-eight- quarter average EBITDA increases slightly to 5.3x as of June 30, 2014. The rating on Media General remains on CreditWatch with positive implications, where S&P placed it on March 21, 2014. The key factors in S&P's evaluation of the combined company (Media General and Lin Media LLC) are its ability to successfully integrate and realize the potential benefits of its increased size and scale, its financial policy, and its expected leverage profile. In resolving the CreditWatch placement, S&P will evaluate the combined company's business risk profile and Media General's ability to successfully integrate all of its acquired stations (Young Broadcasting Inc., LIN Media, and WHTM-TV). In addition, S&P will assess the combined company's financial risk profile, including the company's financial policy and the likely combined leverage. S&P could raise the rating if its analysis of the combined company indicates a business profile with significant size and scale efficiency benefits and a financial policy that is more consistent with an "aggressive" financial risk profile assessment. RATINGS LIST Media General Inc. Corporate Credit Rating B+/Watch Pos/-- Ratings Unchanged Media General Inc. Senior Secured $940 million* first-lien term loan B due 2020 BB- Recovery Rating 2 * Following add-on. MEDICAL REHAB: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Medical Rehab Services, Ltd P.O. Box 2146 Wheeling, WV 26003 Case No.: 14-00879 Nature of Business: Health Care Chapter 11 Petition Date: August 8, 2014 Court: United States Bankruptcy Court Northern District of West Virginia (Wheeling) Judge: Hon. Patrick M. Flatley Debtor's Counsel: Salene Rae Mazur Kraemer, Esq. MAZUR KRAEMER LAW INC 3205 Pennsylvania Avenue, Suite B Weirton, WV 26062 Tel: 304-914-4463 Fax: 888-718-6752 Email: salene@mazurkraemer.com Total Assets: $2.27 million Total Liabilities: $3.80 million The petition was signed by Terrence L. Mason, president, sole shareholder. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/wvnb14-00879.pdf MEGA RV: Gets Approval to Hire Goe & Forsythe as Legal Counsel -------------------------------------------------------------- Mega RV Corp. received approval from the U.S. Bankruptcy Court for the Central District of California to hire Goe & Forsythe, LLP as its general bankruptcy counsel. As bankruptcy counsel, the firm will advise the company regarding matters of bankruptcy law, and represent the company in any proceedings or hearings where its rights under U.S. bankruptcy law may be litigated or affected. Goe & Forsythe will also assist the company in negotiation, formulation, confirmation and implementation of a Chapter 11 plan of reorganization. Goe & Forsythe has agreed to receive an initial retainer of $50,000, which was paid to the firm in April this year by McMahon Staffing Inc., an entity related to Mega RV. From the retainer Winthrop Couchot, prospective co-counsel in the case, received $3,000, while GlassRatner Advisory & Capital Group LLC, financial adviser, received $10,000. Thus, the net retainer to Goe & Forsythe is $37,000, according to court filings. In case the firm seeks payment from the bankruptcy estate, the firm will apply to the bankruptcy court for compensation. Goe & Forsythe will render services to the company at its regular hourly rates, which may be subject to adjustment in the future. The firm does not have an interest to Mega RV's estate and is a "disinterested person," according to a declaration by Robert Goe, Esq., a member of Goe & Forsythe. About Mega RV Corp. Mega RV Corp. filed a Chapter 11 bankruptcy petition (Bankr. C.D. Calif. Case No. 14-13770) on June 15, 2014. Brent McMahon signed the petition as president. The Debtor estimated assets and liabilities of at least $10 million. Judge Mark S Wallace presides over the case. Proposed counsel for the Debtor are Robert P. Goe, Esq. and Elizabeth A. LaRocque, Esq. at Goe & Forsythe, LLP of Irvine, CA. The U.S. Trustee for Region 16 on July 3 appointed three creditors of Mega RV Corp. to serve on the official committee of unsecured creditors. MEGA RV: Gets Approval to Hire GlassRatner as Financial Adviser --------------------------------------------------------------- Mega RV Corp. received court approval to hire GlassRatner Advisory & Capital Group, LLC as its financial adviser and investment banker. The firm will help Mega RV identify buyers for its dealerships and seek to consummate a sale of the dealerships. Specifically, GlassRatner will prepare an offering memorandum for distribution to prospective buyers; assist in negotiations with any prospective stalking horse bidder; bringing additional prospective bidders to the auction of the dealerships; and assist in the sale closing. GlassRatner will be paid a book fee of $10,000. Both sides agree that this fee will be for the preparation and distribution of a sale memorandum and, if no sale occurs, a report by the firm of its sales efforts. The firm will also be paid 5% of the gross sales proceeds of the dealership. For financial advisory services not relating to the marketing and sale of Mega RV's assets, the firm will bill the company at its standard hourly rates. The professionals expected to be involved in this matter and their hourly rates are: Professionals Hourly Rates ------------- ------------ Mike Issa, Principal $450 Patrick Lacy, Senior Associate $275 In case that new capital is raised by GlassRatner in conjunction with a plan of reorganization or otherwise, the firm will be compensated at these: senior debt, 3% of commitment amount; mezzanine debt, 4% of commitment amount; and equity, 5% of invested amount. These fees will be fully earned, subject to court approval, at the time of closing of the financing. In any event, the minimum fee to GlassRatner for services rendered for any transaction will be $175,000, according to court filings. The firm neither hold nor represent any interest materially adverse to Mega RV or its estate, and is a "disinterested person," according to a declaration by J. Michael Issa, managing principal of the California Practice of GlassRatner. About Mega RV Corp. Mega RV Corp. filed a Chapter 11 bankruptcy petition (Bankr. C.D. Calif. Case No. 14-13770) on June 15, 2014. Brent McMahon signed the petition as president. The Debtor estimated assets and liabilities of at least $10 million. Judge Mark S Wallace presides over the case. Proposed counsel for the Debtor are Robert P. Goe, Esq. and Elizabeth A. LaRocque, Esq. at Goe & Forsythe, LLP of Irvine, CA. The U.S. Trustee for Region 16 on July 3 appointed three creditors of Mega RV Corp. to serve on the official committee of unsecured creditors. MEGA RV: Judge Lifts Stay, Allows Ally to Dispose of Vehicles ------------------------------------------------------------- U.S. Bankruptcy Judge Mark Wallace approved a stipulation between Mega RV Corp. and Ally Financial Inc. for relief from the automatic stay. The court-approved stipulation allows Ally Financial to take possession of and dispose of three vehicles: a 2011 Four Winds Freedom Elite, a 2007 Itasca Winnebago; and a 2010 GMC Sierra. About Mega RV Corp. Mega RV Corp. filed a Chapter 11 bankruptcy petition (Bankr. C.D. Calif. Case No. 14-13770) on June 15, 2014. Brent McMahon signed the petition as president. The Debtor estimated assets and liabilities of at least $10 million. Judge Mark S Wallace presides over the case. Proposed counsel for the Debtor are Robert P. Goe, Esq. and Elizabeth A. LaRocque, Esq. at Goe & Forsythe, LLP of Irvine, CA. The U.S. Trustee for Region 16 on July 3 appointed three creditors of Mega RV Corp. to serve on the official committee of unsecured creditors. MICRO HOLDING: S&P Gives 'B' Corp. Credit Rating; Outlook Stable ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned California-based Micro Holding Corp. and MH Sub I LLC (herein referred to as Internet Brands) a corporate credit rating of 'B'. The outlook is stable. At the same time, S&P assigned the $75 million senior secured revolving credit facility due 2019 a 'B' issue-level rating, with a recovery rating of '3', indicating S&P's expectation for meaningful (50% to 70%) recovery of principal for debtholders in the event of default. In addition, S&P assigned the $460 million senior secured term loan B and the $50 million delayed draw term loan B due 2021 a 'B' issue-level rating, with a recovery rating of '3' (50% to 70% recovery expectation). Lastly, S&P assigned the $170 million second-lien loan due 2022 a 'CCC+' issue-level rating, with a recovery rating of '6', indicating S&P's expectation for negligible (0% to 10%) recovery of principal for debtholders in the event of default. "The 'B' corporate credit rating reflects the company's relatively small size and risks of continuous change in its businesses," said credit analyst Jawad Hussain. "It also reflects the company's "highly leveraged" financial risk profile, resulting from the increased debt in the capital structure due to the acquisition of the company by KKR." The stable outlook reflects S&P's view that while pro forma leverage is high, at about 6.5x, the company should be able to continue to generate moderate discretionary cash flow. S&P also expects that it will expand its market share with small and midsize businesses in its health and legal end markets, increase its share of revenue coming from the less volatile licensing and software solutions segments, and reduce leverage to below 6x by the end of 2015. S&P views an upgrade as more likely than a downgrade. S&P could raise the rating over the intermediate term if it becomes apparent that the company is able to reduce leverage more rapidly than expected to below 5.5x in the next 12 to 18 months while continuing to maintain its above average margin profile. This would likely be the result of the company continuing to successfully integrate acquisitions while increasing the percentage of its EBITDA generated from licensing and software solutions offerings. S&P could lower the rating over the intermediate term if EBITDA coverage of interest falls below 1.5x or if S&P concludes that discretionary cash flow will turn negative. This could result from a failure to successfully integrate acquisitions, technological obsolescence of its products and services, a slump in the auto sector from economic weakness, or as a result of a large debt-financed acquisition or dividend to shareholders. MONITOR COMPANY: Ch. 7 Estate Seeks $6M In Slew Of Clawback Suits ----------------------------------------------------------------- Law360 reported that the Chapter 7 trustee for the bankruptcy estate of once-powerful consulting firm Monitor Co. Group LP launched dozens of so-called avoidance actions in Delaware, looking to claw back a total of more than $6 million in alleged preferential transfers. According to the report, in roughly 130 filings that trickled into Delaware bankruptcy court, trustee Alfred T. Giuliano sought to recover alleged preferential payments made during the 90-day period before the consulting firm filed for Chapter 11 protection in November 2012. About Monitor Company Monitor Company Group LP -- http://www.monitor.com/-- was a global consulting firm with 1,200 personnel in offices across 17 countries worldwide. Founded in 1983 by six entrepreneurs, and headquartered in Cambridge, Massachusetts, Monitor advised for- profit, sovereign, and non-profit clients on growing their businesses and economies and furthering their charitable purposes. Monitor and several affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Case Nos. 12-13042 to 12-13062) on Nov. 7, 2012. Judge Hon. Christopher S. Sontchi presides over the case. Pepper Hamilton LLP and Ropes & Gray LLP served as the Debtors' counsel. The financial advisor was Carl Marks Advisory Group LLC. Epiq Bankruptcy Solutions, LLC served as claims and noticing agent. The petitions were signed by Bansi Nagji, president. Cole, Schotz, Meisel, Forman & Leonard, P.A., represented the Committee of Unsecured Creditors as counsel. Bank of America was represented in the case by Jinsoo Kim, Esq., and Timothy Graulich, Esq., at Davis Polk & Wardwell LLP; and Mark D. Collins, Esq., at Richards Layton & Finger PA. J. Gregory Milmoe, Esq., and Shana A. Elberg, Esq., at Skadden Arps Slate Meagher & Flom LLP in New York; and Mark Chehi, Esq., and Christopher DiVirgilio, Esq., at Skadden Arps in Delaware, represented Deloitte Consulting LLP. Caltius Partners IV LP; Caltius Partners Executive IV, LP; and CP IV Pass-Through (Monitor) LP were represented by John Sieger, Esq., at Katten Muchin Rosenman LLP. Monitor's consolidated unaudited financial statements as of June 30, 2012, which include the assets and liabilities of non- Debtor foreign subsidiaries, reflected total assets of roughly $202 million (including $93 million in current assets) and total liabilities of roughly $200 million. Monitor filed for bankruptcy to sell substantially all of their businesses and assets to Deloitte Consulting LLP, a Delaware registered limited liability partnership and DCSH Limited, a UK company limited by shares, subject to higher or otherwise better offers. The base purchase price set forth in the Stalking Horse Agreement is $116.2 million, plus (i) assumption of certain liabilities and (ii) certain cure costs for assumed contracts. The Stalking Horse Agreement provides for the Stalking Horse Bidder to receive a combined breakup fee and expense reimbursement of $4 million. The Debtors held an auction on Nov. 28, 2012, at the offices of the Sellers' counsel, Ropes & Gray LLP in New York. In mid- January 2013, Judge Sontchi allowed the Debtors to sell its assets to Deloitte Consulting for $116.2 million. In July 2013, Monitor Co. and the official creditors' committee decided that the liquidation can be most efficiently concluded now that the business was sold by converting the Chapter 11 reorganization to a liquidation in Chapter 7. MONROE HOSPITAL: Case Summary & 30 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Monroe Hospital, LLC 4011 Monroe Medical Park Blvd. Bloomington, IN 47403 Case No.: 14-07417 Type of Business: Health Care Chapter 11 Petition Date: August 8, 2014 Court: United States Bankruptcy Court Southern District of Indiana (Indianapolis) Judge: Hon. James M. Carr Debtor's Counsel: James R Irving, Esq. BINGHAM GREENEBAUM DOLL LLP 3500 National City Tower 101 South Fifth Street Louisville, KY 40202 Tel: 502-587-3606 Email: jirving@bgdlegal.com - and - Whitney L Mosby, Esq. BINGHAM GREENEBAUM DOLL LLP 10 West Market Street, #2700 Indianapolis, IN 46204 Tel: (317) 968-5469 Fax: (317) 236-9907 Email: wmosby@bgdlegal.com - and - Thomas C Scherer, Esq. BINGHAM GREENEBAUM DOLL LLP 10 W Market St Ste 2700 Indianapolis, IN 46204-2954 Tel: 317-635-8900 Fax: 317-236-9907 Email: tscherer@bgdlegal.com Debtor's UPSHOT SERVICES LLC Noticing, Claims and Balloting Agent: Estimated Assets: $10 million to $50 million Estimated Liabilities: $100 million to $500 million The petition was signed by Joseph Roche, president and chief executive officer. List of Debtor's 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Vibra Acute Care LLC Accounts $3,411,450 Mike Thomas Payable 4550 Lena Dr Suite 225 Mechaniscsburg, PA 17055 Tel: 707-591-5700 Premier Healthcare, LLC Accounts $3,107,720 David Wolfe Payable PO Box 550 Bloomington, IN 47402 Tel: 800-852-6180 Universal Financial SVCS LP Accounts $1,446,826 William Mondi Payable 210 S 5th Street Suite 105 Saint Charles, IL 60174 Bloomington Anesthesiologists Accounts $693,666 Dr. Chad Johnson Payabale P.O. Box 2658 Bloomington, IN 47401 Tel: 8663532000 GE Healthcare Accounts $419,124 Accts Rec. Payable PO Box 96483 Chicago, IL 60693 TSG Resources Litigation $360,000 Schumacher Settlement 200 Corporate Blvd. #201 Lafayetter, LA 70508 Indiana Hospital Association Accounts $304,076 Accts. Rec. Payable One American Square Suite 1900 Indianapolis, IN 46282 Bloomington Sleep Services Accounts $293,180 Accts Rec. Payable 1791 W 3rd Street Bloomington, IN 47404 Tel: 8123351300 Biomet Sports Medicine Accounts $192,071 Payable Stryker Orthopaedics Accounts $185,178 Payable St. Vincent Medical Group, Inc. Accounts $170,000 Payable Medtronics USA Inc. Accounts $162,313 Payable Monroe County Treasurer Accounts $140,793 Payable Cardinal Health Medical Produc Accounts $113,279 Payable CPSI Accounts $89,381 Payable Philips Healthcare Accounts $61,374 Payable KSM Business Services, Inc. Accounts $61,068 Payable Assured Healthcare LLC Accounts $58,585 Payable Brian J Logue, MD PC Accounts $54,900 Payable Pharmasource Healthcare, Inc. Accounts $52,982 Payable Dra Company Accounts $49,500 Payable Bausch & Lomb Surgical Div Accounts $48,963 Payable North America Administrators Accounts $46,959 Payable Cardinal Health Pharmaceutical Accounts $43,841 Payable Duke Energy Accounts $40,570 Payable Universal Hospital Services Accounts $40,057 Payable AMS Sales Corporation Accounts $34,625 Payable Nuance Communications Accounts $33,508 Payable ADP, Inc. Accounts $32,202 Payable Medtronic Neurological Accounts $31,791 Payable MOSS FAMILY: Can Use Fifth Third's Cash Collateral Until Sept. 30 ----------------------------------------------------------------- U.S. Bankruptcy Judge Harry Dees Jr. has issued an interim order giving Moss Family Limited Partnership and Beachwalk, L.P. more time to use the cash collateral of Fifth Third Bank. The interim order allowed Moss Family and Beachwalk to use the cash collateral until September 30. A further hearing on the use of cash collateral will take place on September 25. About Moss Family Moss Family Limited Partnership and Beachwalk, L.P., filed Chapter 11 petitions (Bankr. N.D. Ind. Case Nos. 12-32540 and 12-32541) on July 17, 2012. Judge Harry C. Dees, Jr., presides over the case. Daniel Freeland, Esq., at Daniel L. Freeland & Associates, P.C., represents the Debtors. Moss Family disclosed $6,609,576 in assets and $6,299,851 in liabilities as of the Chapter 11 filing. The Debtors' Amended Joint Chapter 11 Plan dated Dec. 3, 2013, provides that unsecured claims will be fully paid and satisfied by use of the proceeds from the sale of LaPorte Judgment Lien Property. MSI CORP: Sept. 2 Hearing on Approval of Disclosure Statement ------------------------------------------------------------- U.S. Bankruptcy Judge Jeffery Deller is set to hold a hearing on Sept. 2 to consider approval of the disclosure statement, which describes the plan proposed by MSI Corp. to exit Chapter 11 protection. MSI Corp. filed the disclosure statement on July 18 to assist creditors in evaluating its restructuring plan. The plan places claims and equity interests in seven classes and describes the treatment each class will receive. Under the plan, Class 1, which consists of First Commonwealth Bank's $3.24 million secured claim, will be paid in full either from the loan proceeds of an exit financing facility, or from revenue from operations and other available sources. Amada Machine Tools America, Inc.'s secured claim is placed in Class 2. The company, which is owed between $65,000 and $75,000, will be paid in full at no interest over 30 months. Meanwhile, Class 3 consists of claims of other secured creditors, which will be paid in full in accordance with their respective agreements with MSI. Together, these secured creditors assert about $140,000. Class 4 to 6 consists of unsecured claims. Holders of priority tax claims in Class 4 and priority non-tax claims in Class 5 will be paid in full when MSI officially exits bankruptcy. Payment of priority non-tax claims, however, will be subject to any statutory caps or limitations. Meanwhile, Class 6, which consists of general unsecured claims aggregating about $600,000, will be paid in full at no interest within five years after MSI officially emerges from bankruptcy protection. Class 7 consists of equity interests. All equity interests issued by MSI will constitute equity interests in the reorganized company in the same class and percentage as existed prior to the bankruptcy filing. Revenues from operations and any miscellaneous income that MSI might receive over the course of the plan term will be used to fund the proposed payments, according to the disclosure statement. A copy of the disclosure statement can be accessed for free at http://is.gd/qDLg1C Creditors of MSI have until August 26 to file objections to the disclosure statement. MUNDY RANCH: Judge Confirms Plan of Reorganization -------------------------------------------------- U.S. Bankruptcy Judge Robert Jacobvitz on July 31 confirmed the Chapter 11 plan proposed by Mundy Ranch Inc. to exit bankruptcy protection. The bankruptcy judge's order modifies some of the provisions of the Second Amended Chapter 11 Plan related to Mundy Ranch's pension plan. One of these revised provisions requires Mundy Ranch to take certain actions, which include completing a standard termination of the pension plan, to resolve the priority claim of the Pension Benefit Guaranty Corp. Another plan provision modified by the court order relates to Mundy Brothers' split-off. The revised provision requires Mundy Ranch to transfer some of its assets to Mundy Brothers in exchange for the issuance to the company of 990 additional shares of Mundy Brothers' single class of voting common stock. After the assets are transferred, Mundy Ranch will split-off Mundy Brothers. The company will distribute the stock of Mundy Brothers to the Brothers Group in exchange for the Brothers Group's shares of stock in the company. Mundy Ranch will not effect the split-off until it has made payment of Class 1 and 7 claims, according to the court order. The court order also modifies a plan provision concerning the unsecured claim of Valley National Bank. Pursuant to that provision, the bank's unsecured claim resulting from the judgment entered in its favor in the First Judicial District Court in New Mexico is allowed in the amount of $115,425. The claim will be paid in full, with interest at 7.50% per annum. A full-text copy of the confirmation order is available without charge at http://is.gd/p0MicM Mundy Ranch filed its Second Amended Chapter 11 Plan, along with a disclosure statement, on May 2. Judge Jacobvitz on May 29 approved the disclosure statement. Creditors Pension Benefit Guaranty Corp. and Valley National Bank filed objections to the Second Amended Chapter 11 Plan n. Both objections have been resolved by modifications to the Second Amended Plan and have been withdrawn. About Mundy Ranch Mundy Ranch Inc. -- http://www.mundyranch.com/-- is a family- owned corporation organized under the laws of the State of New Mexico with its principal place of business in Rio Arriba County, New Mexico. Mundy Ranch sells undeveloped parcels of real property in northern New Mexico which together occupy approximately 6,000 acres of land. The majority of the land consists of an undivided 5,500 acre parcel, which is also called Mundy Ranch. Mundy Ranch scheduled the Mundy Ranch Parcel as having a value of $17,000,000, with secured claims against the Mundy Ranch Parcel in the amount of $2,095,000. Mundy Ranch generates substantially all of its revenue from developing and selling parcels of land. It generates a small amount of revenue by selling Christmas trees. Mundy Ranch, Inc., filed a Chapter 11 petition (Bankr. D. N.M. Case No. 12-13015) in Albuquerque, New Mexico. The Law Office of George Dave Giddens, PC, in Albuquerque, serves as counsel to the Debtor. The Debtor estimated assets of $10 million to $50 million and debts of up to $10 million. NE OPCO: Pre-Closing Claims Against Cenveo Barred ------------------------------------------------- Bankruptcy Judge Christopher S. Sontchi in Delaware said Cenveo Corporation and Cenveo, Inc., the buyers of certain assets of NE Opco Inc., are not liable for claims over alleged acts that occurred prior to, but related to, Cenveo's purchase of the Debtors' assets. Cenveo filed a "Corrected Motion Pursuant to 11 U.S.C. [Sections] 105 and 363 to Enforce the Court's September 12, 2013 Sale Order and Injunction" to bar a wrongful discrimination claim filed by Paul Torres, who worked as a machine adjuster for NE Opco. Judge Sontchi said the pre-Closing claims against Cenveo related to the sale of the assets do not survive the Closing. Consequently, Mr. Torres' pre-Closing claims are barred by the Sale Order and enjoined from continuing against Cenveo. Judge Sontchi, however, added that claims arising post-Closing are not claims against the Debtors' bankruptcy estate and cannot be barred by the Sale Order. Thus, the Sale Order does not enjoin Torres from asserting claims against Cenveo for (alleged) wrongdoings committed after the Closing. Furthermore, as there are no post-Closing claims against the Debtors, the Bankruptcy Court does not have jurisdiction to decide the post-Closing claims between Torres and Cenveo, the judge said. A copy of the Court's Aug. 8 Opinion is available at http://is.gd/uElxrxfrom Leagle.com. Counsel for Cenveo Corporation and Cenveo Inc.: BALLARD SPAHR LLP Matthew G. Summers, Esq. 919 North Market Street, 11th Floor Wilmington, DE 19801-3034 Fax: 302-252-4466 E-mail: summersm@ballardspahr.com - and - HUGHES HUBBARD & REED LLP Kathryn A. Coleman, Esq. Christopher Gartman, Esq. One Battery Park Plaza New York, New York 10004-1482 Tel: (212) 837-6000 Fax: (212) 422-4726 E-mail: kcoleman@hugheshubbard.com gartman@hugheshubbard.com Counsel for Paul Torres are: GELLERT SCALI BUSENKELL & BROWN LLC Michael Busenkell, Esq. Brya Keilson, Esq. 913 N. Market Street, 10th Floor Wilmington, DE 19801 Tel: 302-425-5812 Fax: 302-425-5814 E-mail: mbusenkell@gsbblaw.com bkeilson@gsbblaw.com - and - LAW OFFICE OF SCOTT R. AMES Scott R. Ames, Esq. 11377 West Olympic Blvd., Suite 500 Los Angeles, CA 90064-1683 Tel: 310-478-2500 Fax: 310-478-2501 About NE OPCO, Inc. National Envelope is the largest privately-held manufacturer of envelopes in North America. Headquartered in Frisco, Texas, National Envelope has eight plants and 15 percent of the envelope market. Revenue of $427 million in 2012 resulted in a $60.1 million net loss, continuing an unbroken string of losses since 2007. NE OPCO, Inc., doing business as National Envelope, along with affiliate NEV Credit Holdings, Inc., filed petitions seeking relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 13-11483) on June 10, 2013. The company disclosed liabilities including $148.4 million in secured debt, with $37.5 million owing on a revolving credit and $15.6 million on a secured term loan. There is a $55.7 million second-lien debt 82 percent held by a Gores Group LLC affiliate. National Envelope, then known as NEC Holdings Corp., first sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 10-11890) on June 10, 2010. The business was bought by Gores Group LLC for $208 million in a bankruptcy sale. National Envelope, through NE OPCO, has returned to bankruptcy to pursue a plan of reorganization or sell the assets as a going concern via 11 U.S.C. Sec. 363. The Debtor plans to facilitate a sale of the business with publicly traded competitor Cenveo Inc. In the 2013 case, the company tapped the law firm Richards, Layton & Finger as counsel, PricewaterhouseCoopers LLP as financial adviser, and Epiq Bankruptcy Solutions as claims and notice agent. The Gores Group is represented by Weil, Gotshal and Manges LLP and Lowenstein Landler LLP. Salus Capital Partners, the DIP agent, is represented by Choate, Hall & Stewart LLP and Morris Nichols Arsht & Tunnell LLP. Wells Fargo Capital Finance, LLC, the prepetition senior agent, is represented by Goldberg Kohn Ltd and DLA Piper. The Official Committee of Unsecured Creditors is represented by Pachulski Stang Ziehl & Jones LLP's Laura Davis Jones, Esq., Bradford J. Sandier, Esq., Robert J. Feinstein, Esq., and Peter J. Keane, Esq. Guggenheim Securities, LLC, serves as its investment banker and financial advisor. National Envelope won court approval on July 19, 2013, for a global settlement permitting a sale of the company without objection from the official unsecured creditors' committee. The settlement ensures some recovery for unsecured creditors. The Company also won final approval for $67.5 million in bankruptcy financing being supplied by Salus Capital Partners LLC. Judge Christopher Sontchi authorized three buyers to acquire National Envelope's business for a total of about $70 million. Connecticut-based printer Cenveo Inc. acquired National Envelope's operating assets for $25 million, Hilco Receivables LLC picked up accounts receivable for $25 million and Southern Paper LLC took on its inventory for $15 million. NOVO POINT: High Court Asked To Clarify Power Of Receivership ------------------------------------------------------------- Law360 reported that in a dispute stemming from the bankruptcy cases of Novo Point LLC and Quantec LLC, which involve the ownership of 150,000 Internet domain names, a bankruptcy trustee and receiver have asked the U.S. Supreme Court to decide whether federal judges have the right to order vexatious litigants into receivership. According to the report, in a conditional cross- petition, receiver Peter Vogel of Gardere Wynne Sewell LLP and trustee Daniel Sherman argued that if the court takes up a dispute over payment of receivership costs involving Ondova Ltd. principal Jeffrey Baron, it should weigh the broader question of whether a Texas federal judge overstepped his authority when he ordered Baron into receivership. The Debtors are Cook Islands entities affiliated with Baron, the report said. OTELCO INC: Reports Net Income of $1.3 Mil. in Second Quarter ------------------------------------------------------------- Otelco Inc., a wireline telecommunications services provider in Alabama, Maine, Massachusetts, Missouri, New Hampshire, Vermont and West Virginia and a provider of cloud hosting and managed services, on Aug. 6 announced results for its second quarter ended June 30, 2014. Key highlights for Otelco include: -- Total revenues of $18.5 million for second quarter 2014. -- Operating income of $4.5 million for second quarter 2014. -- Adjusted EBITDA of $7.4 million for second quarter 2014. "The second quarter of 2014 produced adjusted EBITDA of $7.4 million," said Mike Weaver, Chief Executive Officer of Otelco. "Access line equivalent losses continued to improve as we experienced a loss of less than 1% for second quarter when compared to the first quarter of 2014. Business access line equivalents, driven by the growth of fiber transport and circuits, grew 0.3% over first quarter 2014 while residential access lines declined by 1.6% over first quarter. During second quarter, we reduced our senior debt by $6.1 million to $117.1 million, and our cash balance at June 30, 2014 was $4.8 million. "During second quarter, we implemented the network efficiencies in New England that we announced in May," Mr. Weaver continued. "We also reduced our cable programming costs and made additional operational reductions throughout the Company. These actions reduced costs by $0.3 million in this quarter, and we expect to see approximately $1.3 million in savings from these initiatives in 2014. "Capital investment in our business was $1.5 million for second quarter," noted Mr. Weaver. "These expenditures included enhancements to our New England network and switching facilities in anticipation of growth in Reliable Networks, the cloud hosting and managing services provider we acquired in January. We expect a similar rate of capital expenditures for the balance of the year." The Company reported net income of $1.3 million in there in the three months ended June 30, 2014 to $18.5 million from $109.6 million in the three months ended June 30, 2013. FINANCIAL DISCUSSION FOR SECOND QUARTER 2014: Revenues Total revenues decreased 6.0% in the three months ended June 30, 2014 to $18.5 million from $19.7 million in the three months ended June 30, 2013. The non-renewal of the Time Warner Cable ("TWC") contract accounted for $0.4 million or approximately 32% of the decline. The decrease in residential RLEC access line equivalents and revenue decreases due to the FCC's InterCarrier Compensation reform order (the "FCC's order) account for the majority of the remaining decline which was partially offset by cloud hosting and managed services revenue of $0.2 million relating to Reliable Networks, which we acquired on January 2, 2014. Local services revenue decreased 16.9% in the quarter ended June 30, 2014 to $6.7 million from $8.0 million in the quarter ended June 30, 2013. TWC accounted for a decrease of $0.4 million. The decline in RLEC residential voice access lines, the impact of the FCC's ICC order which reduces or eliminates intrastate and local cellular revenue, and CLEC market pricing accounted for a decrease of $0.4 million. A portion of the RLEC decrease is recovered through the Connect America Fund which is categorized as interstate access revenue. Carrier settlement agreements in 2013 provided one-time revenue of $0.5 million with no comparable revenue in 2014. Hosted PBX revenue increased by $0.1 million. Network access revenue increased 3.2% in the second quarter 2014 to $6.0 million from $5.8 million in the quarter ended June 30, 2013. The Connect America Fund, user-based fees and cost study adjustments increased by $0.8 million. These increases were partially offset by lower state and special access charges of $0.6 million. Internet revenue for the second quarter 2014 decreased 1.7% to $3.6 million from $3.7 million in the three months ended June 30, 2013. A decrease in residential dial-up internet and data lines was partially offset by an increase in fiber rental. Transport services revenue decreased 9.1% in the quarter ended June 30, 2014 to $1.3 million from $1.4 million in the quarter ended June 30, 2013 from customer churn and pricing actions. Cable, IP and satellite television revenue in the three months ended June 30, 2014 decreased 4.0% to $0.7 million in the three months ended June 30, 2014 and 2013 due to subscriber attrition. Cloud hosting and managed services revenue, associated with the acquisition of Reliable Networks, increased revenue $0.2 million for second quarter 2014 with no comparable revenue for the year earlier period. Operating Expenses Operating expenses in the three months ended June 30, 2014 decreased 3.9% to $14.0 million from $14.5 million in the three months ended June 30, 2013. Cost of services decreased 5.4% to $8.6 million in the quarter ended June 30, 2014 from $9.1 million in the quarter ended June 30, 2013. Expenses related to professional services, cloud computing and Hosted PBX increased $0.1 million. Access and circuit costs decreased by $0.3 million, cable and toll costs decreased by $0.1 million, sales and customer services costs decreased by $0.1 million and operational costs decreased by $0.1 million. Selling, general and administrative expenses increased 19.0% to $2.6 million in the three months ended June 30, 2014, from $2.2 million in the three months ended June 30, 2013. Cloud hosting expense associated with our acquisition of Reliable Networks, including an accrual for non-cash stock compensation, increased costs $0.2 million. One-time carrier settlements and property tax reductions of $0.4 million were reflected in 2013 costs with no comparable reductions in 2014. These increases were partially offset by lower insurance and legal expenses of $0.2 million. Depreciation and amortization for second quarter 2014 decreased 14.8% to $2.8 million from $3.3 million in second quarter 2013. Amortization associated with the TWC contract intangible asset decreased by just under $0.4 million as the contract value was fully amortized in June 2013. The amortization of other intangible assets in New England and CLEC depreciation decreased $0.1 million. Interest Expense Interest expense was unchanged at $2.2 million in the three months ended June 30, 2014 and June 30, 2013. The higher interest rate on the debt in the revised credit agreement beginning May 24, 2013 was offset by lower outstanding loan principal. Reorganization Items Separate classification of reorganization items began in first quarter 2013 when the Company filed for Chapter 11 bankruptcy. There were no reorganization expenses during the second quarter of 2014. Adjusted EBITDA Adjusted EBITDA for the three months ended June 30, 2014 was $7.4 million compared to $8.5 million for the same period in 2013 and $7.5 million in the first quarter of 2014. Restructuring, non-cash and certain one-time expenses are added back in the calculation of Adjusted EBITDA. Balance Sheet As of June 30, 2014, the Company had cash and cash equivalents of $4.8 million compared to $9.9 million at the end of 2013. During second quarter 2014, the Company reduced its credit facility balance by $6.1 million through voluntary, Excess Cash and required quarterly payments. The Company's senior credit facility extends through April 2016 and includes a $5.0 million undrawn revolver. Capital Expenditures Capital expenditures were $1.5 million for the second quarter 2014 compared to $0.8 million in the same period in 2013. About Otelco Otelco Inc. (NASDAQ: OTEL) -- http://www.OtelcoInc.com/-- provides wireline telecommunications services in Alabama, Maine, Massachusetts, Missouri, New Hampshire, Vermont and West Virginia. The Company's services include local and long distance telephone, digital high-speed data lines, transport services, network access, cable television and other related services. With approximately 96,000 voice and data access lines, which are collectively referred to as access line equivalents, Otelco is among the top 25 largest local exchange carriers in the United States based on number of access lines. Otelco operates 11 incumbent telephone companies serving rural markets, or rural local exchange carriers. It also provides competitive retail and wholesale communications services through several subsidiaries. On March 24, 2013, the Company and each of its direct and indirect subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13- 10593) to effectuate their prepackaged Chapter 11 plan of reorganization -- a plan that already has been accepted by 100% of the Company's senior lenders, as well as holders of over 96% in dollar amount of Otelco's senior subordinated notes who cast ballots. Otelco's restructuring plan would deleveraged its balance sheet and reduce overall indebtedness by approximately $135 million. The Company's restructuring counsel was Willkie Farr & Gallagher LLP and its financial advisor was Evercore Partners. The restructuring counsel for the administrative agent for the senior lenders was King & Spalding LLP and its financial advisor was FTI Consulting. On May 6, 2013, the Bankruptcy Court entered an order confirming the Plan. On May 24, the Plan was declared effective and Otelco emerged from bankruptcy. Otelco repaid $28.7 million on its senior credit facility and extended its maturity through April 2016. The remaining balance of $133.3 million will have quarterly principal payments of 1.25% of the new loan amount plus interest on the outstanding balance at 6.5%. In addition, the Company will utilize 75% of its quarterly free cash flow to further reduce the outstanding balance on the loan each quarter. The facility includes a $5.0 million revolver which was undrawn at closing. OCZ TECHNOLOGY: Confirms Chapter 11 Plan of Liquidation ------------------------------------------------------- BankruptcyData reported that the U.S. Bankruptcy Court confirmed OCZ Technology Group's Chapter 11 Plan of Liquidation, dated May 7, 2014. OCZ Technology has sold most of its business for $35 million to Toshiba Corp. in January. As previously reported by The Troubled Company Reporter, general unsecured creditors owed about $20 million get nothing other than recoveries from lawsuits. Sherri Toub, substituting for Bill Rochelle, the bankruptcy columnist for Bloomberg News, reported that the two voting classes -- one comprised of the senior claim of Hercules and the other consisting of debenture claims -- voted unanimously in favor of the plan. The disclosure statement estimates a 78.3 percent recovery for holders of about $13.1 million in debentures, the Bloomberg report said. About OCZ San Jose, Calif.-based OCZ Technology Group, Inc. (Nasdaq: OCZ) designs, manufactures, and distributes high-performance solid- state storage solutions and premium computer components. OCZ and two affiliates on Dec. 2, 2013, filed for Chapter 11 protection (Bankr. D. Del. Lead Case No. 13-13126) with a deal to sell all assets under 11 U.S.C. Sec. 363 to Toshiba Corporation for $35 million. As of the bankruptcy filing, the Debtors had funded indebtedness of $29.3 million and general unsecured trade obligations of $31.4 million. The Debtors are represented by Mayer Brown LLP's Sean T. Scott, Esq., as counsel and Young Conaway Stargatt & Taylor LLP's Michael R. Nestor, Esq., Matthew B. Lunn, Esq., and Jaime Luton Chapman, Esq., as Delaware local counsel. Deutsche Bank is the Debtors' investment banker. Mike Rizzo Jr. at RAS Management Advisors, LLC, serves as financial advisors to the Debtors. The Hon. Peter J. Walsh presides over the case. Kelley Drye & Warren LLP's Eric R. Wilson, Esq., Jason R. Adams, Esq., and Gilbert R. Saydah Jr., Esq., serve as counsel to the official committee of unsecured creditors, and Greenberg Traurig, LLP's Dennis A. Meloro, Esq. serves as local counsel. OCZ Technology, on Jan. 17, 2014, received approval from the Bankruptcy Court to sell substantially all of its assets to Toshiba Corporation for $35 million. OCZ Technology changed its name to ZCO Liquidating Corporation. OPPENHEIMER HOLDINGS: S&P Affirms 'B' Counterparty Credit Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services said it revised its outlook on the long-term issuer credit rating on Oppenheimer Holdings Inc. to stable from positive. S&P also affirmed its 'B' counterparty credit and senior secured debt ratings on the company. "The outlook revision reflects our view that Oppenheimer's pretax profitability will remain under pressure because of the costs of ongoing investigations," said Sebnem Caglayan. "Currently, the company has three major ongoing regulatory investigations." Oppenheimer is undergoing an SEC investigation and FinCEN inquiry (Treasury Department Financial Crimes Enforcement Network) with respect to the sales of low-price securities ("penny stocks") by several financial advisers from 2008 to 2010. After reserving $20 million in the first six months of 2014 ($12 million of it was reserved in second-quarter 2014), the company believes it is fully reserved against potential liability arising out of SEC and FinCEN matters as of June 30, 2014. The company has also disclosed two investigations by the Financial Industry Regulatory Authority (FINRA), the first concerning the solicited sale of leveraged and inverse exchange-traded funds (ETFs) during 2010-2011, and the second concerning the supervision of one former Oppenheimer financial adviser. Additionally, the company continues to steadily address its auction-rate securities (ARS) issues. As of June 30, 2014, the company had approximately $99.4 million in ARS on its balance sheet and was committed to purchase another $20.2 million from clients through 2016 under previous legal settlements. The company's clients held at Oppenheimer approximately $147.1 million of ARS as of June 30, 2014. The stable outlook reflects S&P's view that Oppenheimer's profitability and liquidity will be under pressure, but aligned with a 'B' rating, until the company resolves outstanding regulatory matters and continues to gradually address its ARS issues. S&P could lower the ratings if the company's profitability and liquidity deteriorate significantly because of more than expected or reserved for regulatory and legal costs, or if the company receives further inquiries. S&P could also lower the ratings if the company increases its balance sheet risk such that its ATE to adjusted assets falls below 10%. Given the extent of the regulatory overhang, S&P do not expect to raise the ratings in at least the next 12 months. OPTIM ENERGY: Taps Blackstone Unit As $126M Buyer For Coal Plant ---------------------------------------------------------------- Law360 reported that Optim Energy LLC announced that a unit of Blackstone Group LP, which offered a $126 million deal to buy the power plant operator's coal-fired generation plant, prevailed at an auction. The offer, according to Law360, added more than $40 million to the sticker price. Optim selected Blackstone vehicle Major Oak Power LLC as the winning bidder at the Aug. 11 auction after determining its $126 million offer was "highest and best," Law360 said, citing a notice filed in Delaware bankruptcy court. 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. PACIFIC STEEL: Gets Approval to Reject Lease With Berkeley ---------------------------------------------------------- Pacific Steel Casting Co. received court approval to reject a lease for a nonresidential real property owned by Berkeley Properties, LLC in California. The approval is conditioned upon the closing of the sale of Pacific Steel's assets to Speyside Fund LLC, according to an order signed by U.S. Bankruptcy Judge Roger Efremsky. Concurrent with the rejection of the lease, Berkeley, an affiliate of Pacific Steel which is also in bankruptcy protection, was authorized by Judge Efremsky to enter into a new lease with Speyside. The rejection won't have negative impact on the creditors as any claim resulting from the rejection of the old lease will be mitigated by the new lease, according to Pacific Steel's lawyer, Julie Rome-Banks, Esq., at Binder & Malter LLP, in Santa Clara, California. About Pacific Steel Casting, Berkeley Properties Pacific Steel Casting Company and Berkeley Properties, LLC, separately filed Chapter 11 bankruptcy petitions (Bankr. N.D. Cal. Case Nos. 14-41045 and 14-41048) on March 10, 2014. Pacific Steel's petition was signed by Charles H. Bridges, Jr., chief financial officer and director. Michael W. Malter, Esq., at Binder & Malter, LLP serves as the Debtors' counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims, noticing and balloting agent. Burr Pilger Mayer, a certified public accounting firm, serves as financial consultants. Pacific Steel makes carbon, low-alloy and stainless steel castings for U.S. and international customers, largely for heavy-duty trucks and construction equipment. Tracy Hope Davis, the United States Trustee for Region 17, appointed seven creditors to serve on the Official Committee of Unsecured Creditors. The Committee is represented by Ori Katz, Esq., and Michael M. Lauter, Esq., at Sheppard, Mullin, Richter & Hampton LLP. PACIFIC STEEL: Goes to Stalking Horse Speyside for $11.3MM ---------------------------------------------------------- Sherri Toub, substituting for Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Pacific Steel Casting Co. will sell the fourth-generation family-owned steel foundry for $11.3 million cash plus assumption of specified liabilities to Speyside Fund LLC. According to the report, Speyside, who was the stalking horse bidder, was named the winning bidder after Pacific Steel received no other offers. The judge in Oakland, California, approved the sale on July 31. About Pacific Steel Casting, Berkeley Properties Pacific Steel Casting Company and Berkeley Properties, LLC, separately filed Chapter 11 bankruptcy petitions (Bankr. N.D. Cal. Case Nos. 14-41045 and 14-41048) on March 10, 2014. Pacific Steel's petition was signed by Charles H. Bridges, Jr., chief financial officer and director. Michael W. Malter, Esq., at Binder & Malter, LLP serves as the Debtors' counsel. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims, noticing and balloting agent. Burr Pilger Mayer, a certified public accounting firm, serves as financial consultants. Pacific Steel makes carbon, low-alloy and stainless steel castings for U.S. and international customers, largely for heavy-duty trucks and construction equipment. Tracy Hope Davis, the United States Trustee for Region 17, appointed seven creditors to serve on the Official Committee of Unsecured Creditors. The Committee is represented by Ori Katz, Esq., and Michael M. Lauter, Esq., at Sheppard, Mullin, Richter & Hampton LLP. PALM DRIVE HEALTH: Oct. 8 Deadline for Creditors to File Claims --------------------------------------------------------------- U.S. Bankruptcy Judge Alan Jaroslovsky approved the deadlines proposed by Palm Drive Health Care District for filing proofs of claim. Pursuant to the judge's order, creditors holding pre-bankruptcy claims against Palm Drive as well as governmental units must file proofs of their claims by October 8. About Palm Drive Health Care District Palm Drive Health Care District, owner and operator of the Palm Drive Hospital, in Sebastopol, California, filed a petition under Chapter 9 of the Bankruptcy Code (Bankr. N.D. Cal. Case No. 14-10510) amid a "sustained reduction in patient volume and revenue." In its Chapter 9 petition filed April 7, 2014, in Santa Rosa, California, the Debtor estimated $10 million to $50 million in assets and liabilities. The Debtor is represented by Michael A. Sweet, Esq., at Fox Rothschild LLP, as counsel. PETRON ENERGY: Amends Q2 Form 10-Q to Revise Disclosure ------------------------------------------------------- Petron Energy II, Inc., filed an amended Form 10-Q for the quarterly ended June 30, 2014, for the purpose of making certain changes to the disclosures related to common stock and preferred stock in the financial statements. A full-text copy of the amended Form 10-Q is available at http://is.gd/DFMiSm For the three months ended June 30, 2014, the Company reported a net loss of $4.32 million on $33,201 of oil and gas sales as compared with a net loss of $1.32 million on $20,760 of oil and gas sales for the same period in 2013. As of June 30, 2014, the Company had $3.38 million in total assets, $5.39 million in total liabilities and a $2.01 million total stockholders' deficit. About Petron Energy Dallas-based Petron Energy II, Inc., is engaged primarily in the acquisition, development, production, exploration for and the sale of oil, gas and gas liquids in the United States. As of Dec. 31, 2011, the Company is operating in the states of Texas and Oklahoma. In addition, the Company operates two gas gathering systems located in Tulsa, Wagoner, Rogers and Mayes counties of Oklahoma. The pipeline consists of approximately 132 miles of steel and poly pipe, a gas processing plant and other ancillary equipment. The Company sells its oil and gas products primarily to a domestic pipeline and to another oil company. Petron Energy reported a net loss of $4.30 million in 2013 following a net loss of $8.32 million in 2012. KWCO, PC, in Odessa, TX, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company's significant operating losses since inception raise substantial doubt about its ability to continue as a going concern. REVEL AC: US Trustee Wants Fox Rothschild Off Ch. 11 ---------------------------------------------------- Law360 reported that the U.S. government's bankruptcy watchdog accused Fox Rothschild LLP of receiving improper retainer payments from the owner of Atlantic City's bankrupt Revel Casino Hotel, claiming that the resulting liability precludes the firm from representing the debtor. According to the report, Roberta DeAngelis, the U.S. Trustee for Region 3 of the bankruptcy courts, argued that Fox Rothschild cannot be considered a "disinterested" professional under the U.S. Bankruptcy Code due to its preference litigation exposure on roughly $821,000 in fee payments made during the 90 days before Revel AC Inc. filed for bankruptcy. About Revel AC Revel AC, Inc. -- http://www.revelresorts.com/-- owns and operates Revel, a Las Vegas-style, beachfront entertainment resort and casino located on the Boardwalk in the south inlet of Atlantic City, New Jersey. Revel AC Inc. and five of its affiliates sought bankruptcy protection (Bankr. D.N.J., Lead Case No. 14-22654) on June 19, 2014, to pursue a quick sale of the assets. The Chapter 11 cases are assigned to Judge Gloria M. Burns. The Debtors' Chapter 11 cases are jointly consolidated for procedural purposes. Revel AC estimated assets ranging from $500 million to $1 billion, and the same amount of liabilities. White & Case, LLP, and Fox Rothschild, LLP, serve as the Debtors' Counsel, and Moelis & Company, LLC, is the investment banker. The Debtors' solicitation and claims agent is Alixpartners, LLP. The prepetition first lenders are represented by Cadwalader, Wickersham & Taft LLP. The prepetition second lien lenders are represented by Paul, Weiss, Rifkind, Wharton & Garrison LLP. The DIP agent is represented by Milbank, Tweed, Hadley & McCloy LLP. This is Revel AC's second trip to bankruptcy. The company first sought bankruptcy protection (Bankr. D.N.J. Lead Case No. 13- 16253) on March 25, 2013, with a prepackaged plan that reduced debt by $1.25 billion. Less than two months later on May 15, 2013, the 2013 Plan was confirmed and became effective on May 21, 2013. RYNARD PROPERTIES: Fannie Mae Wants Operating Reports Submitted --------------------------------------------------------------- Fannie Mae filed with the Bankruptcy Court a limited objection to Rynard Properties Ridgecrest LP's motion for an extension of the exclusive plan filing deadline. Fannie Mae narrates that the Debtor has failed to timely file monthly operating reports for the months of May and June, and that monthly operating reports for the months of March and April were not filed until June 10, 2014. Fannie Mae asserts that without those operating reports, it is not able to monitor the Debtor's use of its cash collateral or ensure that the Debtor is otherwise operating in a manner that is consistent with the terms and provisions of the Court's Cash Collateral Use Order. While Fannie Mae does not object to the 60-day extension sought by the Debtor, it seeks that any extension be conditioned on the Debtor being ordered by the Court to file: (i) the past due operating reports within two (2) business days of the hearing or such other time as the Court deems appropriate; and (ii) the July report no later than August 15, 2014 and future month's reports by no later than the 15th of the following month as provided by the U.S. Trustee's Operating Guidelines for Chapter 11 Debtors. As reported in the Troubled Company Reporter on July 23, 2014, Rynard Properties Ridgecrest LP filed a motion with the U.S. Bankruptcy Court seeking a 60-day extension of the exclusive periods to file a Chapter 11 Plan and Disclosure Statement and, to obtain acceptance of the Chapter 11 Plan. The Debtor said it is in negotiations with two separate lenders to obtain the funds to refinance the apartment complex and remove Fannie Mae as its secured lender on its collateral. The Debtor believes they can close within 60 days and may not have need for further reorganization or, with the refinancing, will have the ability to file a viable Chapter 11 Plan. Fannie Mae is the Debtor's primary lender to whom the Debtor is indebted of approximately $6,000,000 and which is secured by a first priority Deed of Trust encumbering the Ridgecrest Apartment complex operated by Debtor. Attorneys for Fannie Mae can be reached at: QUATTLEBAUM, GROOMS, TULL & BURROW, PLLC 111 Center Street, Suite 1900 Little Rock, AR 72201 Telephone: 501.379.1735 (Direct) Fax: 501.379.3835 (Direct) E-mail: gtreece@qgtb.com About Rynard Properties Ridgecrest LP Rynard Properties Ridgecrest LP is a Tennessee limited partnership. Its principal place of business is 2881 Rangeline Road, Memphis, TN 38127, and the Debtor operates a 256 unit multifamily apartment complex of Section 8 housing named Ridgecrest Apartments and currently has TESCO operating the complex as leasing agent. The Debtor filed a Chapter 11 bankruptcy petition (Bankr. W.D. Tenn. Case No. 14-22674) on March 13, 2014. John Bartle signed the petition as secretary/treasurer of Ridgecrest LLC, general partner of the Debtor. In its schedules, the Debtor disclosed $16,231,959 in total assets and $8,734,000 in total liabilities. Toni Campbell Parker serves as the Debtor's counsel. Judge Jennie D. Latta oversees the case. The U.S. Trustee for Region 8 has notified the Bankruptcy Court that it was unable to appoint an official committee of unsecured creditors. SAGE PRODUCTS: S&P Raises First-Lien Debt Rating to 'B+' -------------------------------------------------------- Standard & Poor's Ratings Services revised its recovery rating and raised its issue-level rating on Sage Products Holdings III LLC's first-lien debt to '2' and 'B+', respectively, following an unexpected debt reduction. The '2' recovery rating indicates S&P's expectation of substantial (70%-90%) recovery in the event of a payment default. Sage's corporate credit rating and second- lien debt ratings remain unchanged. "Our assessment of Sage's business risk profile reflects the company's limited size, narrow focus on medical products that help prevent hospital-acquired conditions, high customer concentration, limited barriers to entry, and the highly competitive nature of the medical devices industry," said credit analyst Maryna Kandrukhin. "These weaknesses are only partially offset by the company's leading market positions across all of its product lines and a well-diversified product mix within its niche space. Overall, we view Sage's business risk as "weak"." The stable outlook on Sage reflects S&P's expectation that the company will likely sustain its debt-to-EBITDA ratio above 5.0x in the long run. While S&P projects that the company's leverage will be around 4x at the end of 2014, S&P thinks a short-term debt-to- EBITDA ratio below 5.0x provides Sage with additional room for operating disruptions and adds spare capacity for aggressive financial policy, which S&P expects from its financial sponsor. Downside scenario S&P's downgrade scenario is predicated on its concern over potential emergence of rival product offerings threatening Sage's competitive position. In S&P's opinion, the loss of its leading market position could permanently weaken Sage's business risk profile since the market share lost to competition in the company's niche space would be very hard to regain because of the limited barriers to entry. Such a scenario could encompass a 10% revenue decline coupled with a 600-basis-point EBITDA margin contraction resulting in discretionary cash flow below $10 million. Upside scenario S&P could consider an upgrade if it become confident that Sage's financial policy is focused on permanent debt reduction and sustained maintenance of leverage below 5x. While Sage's leverage ratio has improved as a result of its recent debt prepayments, S&P still expects its aggressive financial policy to result in increased leverage in the long run which makes an upgrade unlikely over the next year. SGK VENTURES: US Trustee Removes Terrapin Metals as Panel Member ---------------------------------------------------------------- The U.S. Trustee amended the list official committee of unsecured creditors in the Chapter 11 case of SGK Ventures LLC, fka Keywell LLC, for the third time. The Trustee informed the Bankruptcy Court of the removal of Terrapin Metals Recycling LLC as a committee member as a result of the transfer of its claim. These entities remain on the unsecured creditors' panel: 1. Ferrous Processing & Trading FPT Cleveland Howard Sherman 2. SA Recycling LLC Dan Navabpour 3. Omni Source Corporation Marlene Sloat 4. Schnitzer Steel Industries James Devine 5. Schupan & Sons, Inc. Andrew Knowlton About Keywell L.L.C. Keywell L.L.C., a supplier of scrap titanium and stainless steel, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 13-37603) on Sept. 24, 2013. Mark Lozier signed the petition as president and CEO. Keywell LLC first filed schedules disclosing $22,515,017 in total assets, and $35,025,633 in total liabilities. In its amended schedules, Keywell disclosed $22,546,386 in total assets and $39,361,793 in total liabilities. As reported in the Troubled Company Reporter on May 12, 2014, the Debtor filed an amended summary of schedules disclosing assets of $22,602,974 and liabilities of $37,181,354. Judge Eugene R. Wedoff presides over the case. Howard L. Adelman, Esq., Chad H. Gettleman, Esq., Henry B. Merens, Esq., Brad A. Berish, Esq., Mark A. Carter, Esq., Adam P. Silverman, Esq., and Nathan Q. Rugg, Esq., at Adelman & Gettleman Ltd. serve as the Debtor's counsel. Alan B. Patzik, Esq., Steven M. Prebish, Esq., and David J. Schwartz, Esq., at Patzik, Frank & Samotny Ltd. serve as the Debtor's special counsel. Eureka Capital Markets, LLC, serves as the Debtor's investment banker, while Conway MacKenzie, Inc., serves as its financial advisors. The Debtor's lenders are represented by Steven B. Towbin, Esq., and Gordon E. Gouveia, Esq., at Shaw Fishman Glantz & Towbin LLC, in Chicago, Illinois. The United States Trustee for Region 11 appointed an Official Committee of Unsecured Creditors. The panel has hired David A. Agay, Esq., Sean D. Malloy, Esq., Scott N. Opincar, Esq., Joshua A. Gadharf, Esq., and T. Daniel Reynolds, Esq., at McDonald Hopkins LLC as counsel. Alvarez & Marsal North America, LLC, serves as financial advisors to the Committee. In December 2013, the Bankruptcy Court formally approved the sale of the Debtor's assets to KW Metals Acquisition LLC for $15.8 million. The original offer was from Cronimet Holdings Inc. for $12.5 million cash. Keywell LLC changed its name and case caption to "SGK Ventures, LLC" following the sale. SMART MOTION: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Smart Motion Robotics, Inc. 805 Thornwood Dr. Sycamore, IL 60178 Case No.: 14-82459 Chapter 11 Petition Date: August 8, 2014 Court: United States Bankruptcy Court Northern District of Illinois (Rockford) Judge: Hon. Thomas M. Lynch Debtor's Counsel: John A Lipinsky, Esq. COMAN & ANDERSON, P.C. 650 Warrenville Road Suite 500, Lisle, IL 60532 Tel: (630) 428-2660 Email: jlipinsky@comananderson.com khaskell@comananderson.com Total Assets: $796,999 Total Liabilities: $3.18 million The petition was signed by Scott Gilmore, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/ilnb14-82459.pdf SOLITRON DEVICES: Bankr. Court Can't Block Contribution Suit ------------------------------------------------------------ Bankruptcy Judge Robert A. Mark has reopened the Chapter 11 bankruptcy proceedings of Solitron Devices Inc., and Solitron Microwave Inc. The Debtors won confirmation of a chapter 11 exit plan more than 20 years ago, in August 1993. In his May 23, 2014, Order, Judge Mark reopened the cases to consider the Reorganized Debtor's Motion to Enforce the Court's Order Confirming Plan. A group of so-called potential responsible parties settled with the New York State Department of Environmental Conservation regarding contamination claims related to the Clarkstown, N.Y. landfill, and in August 2013, these PRPs sued Solitron for contribution. The Debtors moved to reopen the bankruptcy case to stop the litigation. Specifically, the Debtors seek to enjoin the Clarkstown Landfill Joint Defense Group from pursuing a contribution lawsuit against Solitron. The Debtors argue that the Confirmation Order discharged the NYSDEC's Clarkstown landfill claim against the Debtors. Since Solitron has no liability to the NYSDEC and because common liability is a requirement for CERCLA contribution claims between the so-called Potential Responsible Parties, the Debtors argue that the JDG has no legal basis to pursue a contribution claim. In response the JDG argues that the NYSDEC did not have a prepetition claim because the NYSDEC was unaware of Solitron's potential pollution of the Clarkstown landfill or the existence of any CERCLA claims against Solitron until 1995 at the earliest, long after the Court entered the Confirmation Order. The JDG also argues that even if the NYSDEC's claim was discharged, the JDG's claims were not, and therefore, the JDG can still pursue its Contribution Lawsuit against Solitron. In his May 23 Order, Judge Mark held that the Motion to Enforce is granted in part to the extent that the Court concludes that the NYSDEC's claim against Solitron was discharged and concludes that the JDG has no legal basis to pursue a CERCLA contribution claim against Solitron. The Motion to Enforce is denied to the extent the Debtors seek to enjoin the JDG from pursuing the Contribution Lawsuit and denied to the extent the Debtors seek fees and costs. Upon finality of the Order, the case shall be reclosed, Judge Mark said. Judge Mark explained, "Even though the Court agrees with Solitron's position on the two legal issues presented by the Motion to Enforce, the Court lacks jurisdiction to enjoin the JDG from pursuing the Contribution Lawsuit. Because the JDG did not have a claim that was discharged, the JDG did not violate the Confirmation Order in pursuing the Contribution Lawsuit. The Court addressed whether the JDG had a legal basis to pursue a CERCLA contribution claim after determining that the NYSDEC's claim was discharged because the parties briefed and argued the issue. Nevertheless, it is up to the District Court in the Contribution Lawsuit to dismiss the claim against Solitron if the JDG chooses to proceed. Finally, because the JDG did not violate the Confirmation Order, the Debtor's request for fees and costs is also denied. The Debtors filed for Chapter 11 bankruptcy (Bankr. S.D. Fla. Case Nos. 92-30190 and 92-30191) on Jan. 24, 1992. The Bankruptcy Court on Aug. 19, 1993, entered the Order Confirming the Debtors' Fourth Amended Plan of Reorganization. The Confirmation Order contains an injunction preventing discharged claim holders from proceeding against the reorganized Debtors. The case was closed on July 12, 1996. SOMERSET HILLS SCHOOL: Status Conference Set for Sept. 30 --------------------------------------------------------- A status conference is set for Sept. 30, 2014, at 2:00 p.m. in the Chapter 11 case of Somerset Hills School, Inc. The hearing will be held at CMG - Courtroom 3, in Trenton, New Jersey. Somerset Hills School, Inc., and Somerset Hills Residential Treatment Center, Inc., filed separate Chapter 11 petitions (Bankr. N.J. Case Nos. 14-25204 and 14-25202) on July 25, 2014. Judge Christine Gravelle oversees the cases. John S. Mairo, Esq., at Porzio, Bromberg & Newman, P.C., serves as the Debtors' counsel. Somerset Hills School is a private, taxpayer-funded school for students with disabilities. In its petition, Residential listed under $50,000 in assets and under $10 million in debts. School listed under $500,000 in assets and under $10 million in debts. Christopher Baxter, writing for The (N.J.) Star-Ledger reported that the school and the related treatment center filed for bankruptcy protection to trim more than $3 million in debt, including at least $1 million owed to a pension fund for current and former employees. The report added that the Chapter 11 filing caps a tumultuous 10 months since a Star-Ledger investigation last year raised questions about the spending of public money at the school and problems at the center, including the unwarranted restraint of children. In response to the newspaper's inquiries, the state Department of Children and Families announced it would cut ties with the center, forcing it to shut down Dec. 31. The report noted that the demise of the for-profit center left the companies saddled with big bills but with a fraction of the revenue, court documents show. According to the Star-Ledger, the owner of Somerset Hills, Ryan Kimmins, said the bankruptcy filing "was necessary to ensure the long-term viability" of the school. He added, "During our reorganization, we will continue operating our school, business as normal." According to the Star-Ledger, the bankruptcy filings were made to halt a judgment hearing in an lawsuit by the companies' landlord. The report noted that Jerome Amedeo, who owned the Warren Township property where the school had been based, sued Kimmins and Somerset Hills in Superior Court in Somerset County in February seeking $1.6 million in rent, taxes, unpaid bills and repairs to fix damage to the property. Amedeo sought summary judgment for that amount, but on the date the state court judge was to decide on the request, Kimmins and Somerset Hills filed for bankruptcy and the suit was put on hold. The school and treatment center also reported owing $1.89 million to Bank of America, $114,054 to Performax, a Monmouth Beach consulting firm, $56,892 to the Department of Children and Families and $21,835 to the Newark Board of Education, among others, according to court documents, the report related. SPIRIT LIFE CHURCH: Case Summary & 5 Unsecured Creditors -------------------------------------------------------- Debtor: Spirit Life Church, Inc. 9455 North 76th Street Milwaukee, WI 53223 Case No.: 14-30107 Chapter 11 Petition Date: August 8, 2014 Court: United States Bankruptcy Court Eastern District of Wisconsin (Milwaukee) Debtor's Counsel: Jonathan V. Goodman, Esq. Derek H. Goodman, Esq. LAW OFFICES OF JONATHAN V. GOODMAN Suite 707, 788 North Jefferson Street Milwaukee, WI 53202-3739 Tel: 414-276-6760 Fax: 414-287-1199 Email: jgoodman@ameritech.net Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Pastor Tom Wilke, president. A list of the Debtor's five largest unsecured creditors is available for free at http://bankrupt.com/misc/wieb14-30107.pdf SPRINGLEAF HOLDINGS: S&P Hikes ICR to 'B' on Legacy Assets Sale --------------------------------------------------------------- Standard & Poor's Ratings Services said it raised its issuer credit rating on Springleaf Holdings Inc. to 'B' from 'B-'. At the same time, S&P raised its issue ratings on Springleaf's senior unsecured debt to 'B-' from 'CCC+' and on Springleaf's preferred stock to 'CCC' from 'CCC-'. The outlook is stable. Springleaf announced that the company entered into a series of transactions to sell $7.2 billion of legacy residential mortgage- backed securities, whole mortgage loans, and servicing assets. The buyers of the assets will assume the securitized debt associated with the assets sold and pay a premium of roughly $575 million to $625 million, in total generating about $3.0 billion of cash for Springleaf. Following the transaction, the company's total debt to equity will improve to 3.7x from 6.7x at March 31, 2014. "We believe the combination of an improved leverage profile and a bolstered liquidity position support the higher rating," said Standard & Poor's credit analyst Stephen Lynch. Springleaf's real estate portfolio has been in run-off since the first quarter of 2012, when the former mortgage lender ceased origination of subprime mortgage loans. Since that time, the company's principal business activity has been underwriting nonprime consumer loans. In the announcement, which the company released in conjunction with its second-quarter results, Springleaf stated that the proceeds from the sale will aid organic and inorganic growth and minimize the need for incremental debt. S&P recognizes that such growth could increase the company's leverage from the post- transaction 3.7x, but it don't expect the company to again take on so much debt that S&P would lower the rating. Based on management's comments on their earnings call, S&P expects that Springleaf will use at least a portion of the proceeds from the sale to fund the repayment of existing debt. Following the transaction, Springleaf will still have $3.9 billion of debt maturing before the end of 2017 ($344 million in 2014, $797 million in 2015, $375 million in 2016, and $2.36 billion in 2017). S&P's ratings on Springleaf continues to also reflect the company's still relatively high leverage, dependence on wholesale funding, financial-sponsor ownership, and onerous debt maturity profile. The company's limited competition in the nonprime consumer lending market and underwriting policies are strengths to the rating. S&P's stable outlook balances the firm's improving earnings and post-transaction reduced leverage against the company's dependence on wholesale funding and onerous debt maturity ladder over the next four years. S&P could lower the rating if Springleaf's leverage were to unexpectedly increase above 4.5x without a corresponding improvement in the company's business position. S&P could also lower the rating if management pursues a more aggressive growth strategy or financial policy, or if earning metrics deteriorate. Over time, S&P could raise the rating if the company establishes a longer track record in the consumer lending market with continued access to asset-backed financing. An upgrade would also depend on the company diversifying its revenue sources and showing a longer history of containing credit losses. However, the company's profile as a monoline subprime consumer lender is likely to limit the degree of rating upside. STARWOOD HOTELS: Moody's Assigns (P)Ba1 Preferred Stock Rating -------------------------------------------------------------- Moody's Investors Service assigned a Prime-2 short term rating to Starwood Hotels & Resorts Worldwide Inc. proposed $1.75 billion commercial paper program. Starwood's Baa2 senior unsecured ratings were also affirmed. The rating outlook is stable. The net proceeds of the commercial paper issuance will be used for general corporate purposes. Starwood's Prime-2 commercial paper rating reflects its Baa2 long term senior unsecured rating, its good liquidity profile and Moody's expectation that the company will maintain sufficient availability at all times under its $1.75 billion revolver credit facility to support the roll-out of its commercial paper borrowings. Starwood has a widely diversified bank group and the revolver includes a same day funding option that would support the roll-out of commercial paper should the need arise. Over the next twelve months, Moody's expect Starwood to generate sufficient cash flow to support capital spending and its ordinary dividend although cash balances may be needed to help support cash flows to fund its special dividend of $2.60 per share in 2014. Unrestricted cash balances also provide significant support, even after adjusting for taxes on amounts held outside the US. As of June 30, 2014, the company had about $600 million of unrestricted cash, of which about $500 million resided in foreign countries. Starwood's available sources of alternate liquidity include its $1.75 billion committed corporate revolving credit facility that expires in February 2018. Moody's expect the company will continue to maintain healthy covenant headroom under its revolver. New ratings assigned: Short-term commercial paper rated Prime-2 Existing ratings affirmed: $450 million ($294m outstanding) 7.375% notes due 2015 at Baa2 $400 million ($372m outstanding) 6.75% notes due 2018 at Baa2 $250 million ($209m outstanding) 7.15% notes due 2019 at Baa2 $350 million 3.125% notes due 2023 at Baa2 Senior unsecured shelf rating at (P)Baa2 Subordinated shelf rating at (P)Baa3 Preferred stock rating at (P)Ba1 Ratings Rationale Starwood's Baa2 senior unsecured ratings reflect its well-defined branding strategy and Moody's expectation that the company will continue to generate positive free cash flow (excluding its special dividend) and maintain a material amount of availability under its $1.75 billion revolver (not-rated) expiring February 2018. The ratings also incorporate Moody's expectation that there will be no change in Starwood's clearly stated financial policy, including its good liquidity, lease adjusted debt to EBITDAR leverage target of at or above 2.5 times to less than 3.0 times, and dividend payout ratio of 30% to 50%. Moody's expects Starwood will manage its dividend and other shareholder friendly activities in a manner that maintains credit metrics within this range which Moody's view as appropriate for its Baa2 / Prime-2 ratings. Management's estimates that $750 million of additional leverage would be needed to reach the lower end of this range. Starwood has increased its share repurchase authorization by $1.1 billion bringing total availability under the program to about $1.5 billion. For the LTM period ending June 30, 2014, Moody's adjusted debt/EBITDAR was about 2.1 times, although adding an additional $750 million of debt would increase leverage to over 2.7 times on a pro forma basis for the LTM period. Other positive rating considerations include the company's increase towards higher margin franchise brands, solid hotel development pipeline, and good management of its time share operations. Key rating concerns include Starwood's sensitivity to economic cycles, risks related to growing and gaining appropriate distribution of new home grown brands, material international expansion and challenges in emerging markets. The stable outlook reflects Moody's expectation that despite further earnings improvement, there could be some softness in Starwood's RevPAR growth in certain regions of the world that could temper the company's overall earnings improvement. The stable outlook also considers that as Starwood moves to a more asset light business model and sells owned hotels, debt levels may have to be adjusted to maintain appropriate leverage and compensate for the switch to a management fee earnings stream versus owned property income. The outlook also incorporates Moody's view that Starwood maintain a balanced financial policy towards dividends and share repurchases. Higher ratings would require that Starwood achieve and maintain debt/EBITDA below 2.0 times, EBIT/Interest over 4.5 times, and retained cash flow/ net debt greater than 25%. An upgrade would also require that Starwood maintain its good liquidity as well as continue to manage its dividend and other shareholder friendly activities in a manner consistent with a higher rating. Ratings could be downgraded in the event debt/EBITDA rose above 3.0 times, EBIT to interest fell towards 3.25 times, or retained cash flow to net debt declined towards 15% for an extended period of time. The principal methodology used in this rating was Global Lodging & Cruise Industry Rating Methodology published in December 2010. Starwood Hotels & Resorts Worldwide, Inc. owns and operates approximately 1,175 properties in more than 100 countries. Annual net revenues are about $3.3 billion. T-L BRYWOOD: August 20 Hearing on Interim Use of Cash Collateral ---------------------------------------------------------------- U.S. Bankruptcy Judge J. Philip Klingeberger is set to hold a telephonic hearing on August 20 on T-L Brywood LLC's continued use of cash collateral. T-L Brywood on April 20 received court approval to use the cash collateral until August 31. The company will use the cash collateral in which RCG-KC Brywood LLC asserts an interest to maintain its property. In return for its continued use of the cash collateral, T-L Brywood was required to maintain and pay premiums to cover all of its assets from damage and to reserve sufficient funds to pay real estate taxes on a property known as Brywood Centre. The lender will also be granted "valid, perfected, enforceable" security interests in T-L Brywood's post-petition assets in case there is diminution in the value of the assets, according to the April 20 order. About T-L Brywood T-L Brywood LLC filed for Chapter 11 bankruptcy (Bankr. N.D. Ill. Case No. 12-09582) on March 12, 2012. The case was transferred to the U.S. Bankruptcy Court for the Northern District of Indiana (Case. 13-21804) on May 14, 2013. T-L Brywood owns and operates a commercial shopping center known as the "Brywood Centre" -- http://www.brywoodcentre.com/-- in Kansas City, Missouri. The Property encompasses roughly 25.6 acres and comprises 183,159 square feet of retail space that is occupied by 12 operating tenants. The occupancy rate for the Property is approximately 80%. The Debtor and lender The PrivateBank and Trust Company reached an impasse over the terms and conditions of another extension of a mortgage loan on the Property. As a result, the Debtor filed the Chapter 11 case to protect the Property from foreclosure while the Debtor formulates an exit strategy from the reorganization case. As of the Petition Date, no foreclosure relating to the Property had been filed by the Lender. Judge Donald R. Cassling oversees the case. The Debtor is represented by David K. Welch, Esq., Arthur G. Simon, Esq., and Jeffrey C. Dan. Esq., at Crane, Heyman, Simon, Welch & Clar, in Chicago. The Debtor disclosed total assets of $16,666,257 and total liabilities of $13,970,622 in its schedules. The petition was signed by Richard Dube, president of Tri-Land Properties, Inc., manager. PrivateBank is represented by William J. Connelly, Esq., at Hinshaw & Culbertson LLP. No committee of creditors was appointed by the U.S. Trustee. TERVITA CORP: S&P Affirms 'B-' Corp. Credit Rating -------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B-' long-term corporate credit rating on Calgary, Alta.-based integrated environmental service company Tervita Corp. The outlook is stable. At the same time, Standard & Poor's affirmed its 'B-' issue-level rating and '3' recovery rating on the secured notes; and its 'CCC' issue-level rating and '6' recovery rating on the company's subordinated notes. The '3' recovery rating indicates S&P's expectation of meaningful (50%-70%) recovery in a default scenario, while the '6' recovery rating indicates S&P's expectation of negligible (0%-10%) recovery. "We have revised Tervita's business risk profile to "weak" from "fair" to reflect our view that the company's operations, although less volatile than those of other oilfield service companies, faces a competitive landscape that significantly pressures its gross margins," said Standard & Poor's credit analyst Aniki Saha- Yannopoulos. At the same time, S&P has revised its growth prospect for Tervita downward from its previous estimates. S&P also revised its financial sponsor policy score to FS-6 from FS-6 (minus) to reflect management's revised strategy to keeping capex within cash flow, instead of funding growth capex with additional debt, as it had done historically. Tervita provides services in various fields, including energy- related waste management, environmental remediation, and well servicing. Most of the company's operations are in western Canada (85% of gross profit), with some in the U.S. The stable outlook reflects Standard & Poor's view that Tervita will maintain some cushion under its covenants through 2015 so it will be able to borrow full availability under its revolver. Despite improving EBITDA from 2013 levels, S&P forecasts the company's debt-to-EBITDA will remain elevated at 8.0x-9.0x due to its high balance-sheet debt; S&P views Tervita's core credit ratios as highly leveraged. At current EBITDA and debt, the company has little flexibility to add debt without affecting the ratings. S&P could downgrade Tervita if the company's covenant headroom and liquidity deteriorate. Although S&P is aware that Tervita's credit measures are weak, S&P believes that the existing covenant cushion allows the company sufficient liquidity (the full C$235 million availability under its facility) to continue its business operations. If the financial covenant headroom declines to below 15%, S&P could revisit the ratings. S&P could also review the ratings if Tervita's EBITDA does not improve from 2013 levels. In addition, debt-financing of growth initiatives, either acquisition or capital expenditures, where the company outspends its cash flow from operations without any prospects for rapid deleveraging, could lead S&P to revisit its ratings and outlook. A positive action for Tervita would depend on an improving financial risk profile -- for example, if the company's debt-to- EBITDA improves to 5.0x-5.5x following a financial restructuring. From an operational perspective, if S&P expects Tervita to grow its EBITDA, either through lower overhead costs or more cross- selling opportunities, such that S&P expects debt-to-EBITDA to improve below 5.5x, S&P could take a positive rating action. Given S&P's views on industry conditions, S&P believes this is unlikely in the next 12 months. TIN CROSS VINEYARDS: Case Summary & Largest Unsecured Creditors --------------------------------------------------------------- Debtor affiliates filing separate Chapter 11 bankruptcy petitions: Debtor Case No. ------ -------- Tin Cross Vineyards, LLC 14-11160 14851 Grove Street Healdsburg, CA 95448 Capture Wines LLC 14-11161 14851 Grove Street Healdsburg, CA 95448 Capture Wine Brands LLC 14-11162 14851 Grove Street Healdsburg, CA 95448 Chapter 11 Petition Date: August 8, 2014 Court: United States Bankruptcy Court Northern District of California (Santa Rosa) Judge: Hon. Alan Jaroslovsky Debtors' Counsel: Michael C. Fallon, Esq. LAW OFFICE OF MICHAEL C. FALLON 100 E St. #219 Santa Rosa, CA 95404 Tel: (707) 546-6770 Email: mcfallon@fallonlaw.net Total Total Assets Liabilities --------- ----------- Tin Cross Vineyards, LLC $6.32MM $6.07MM Capture Wines LLC $800,742 $7.3MM Capture Wine Brands LLC $250,000 $6.53MM The petitions were signed by Michael Foster, managing member. A list of Tin Cross Vineyards's 10 largest unsecured creditors is available for free at http://bankrupt.com/misc/canb14-11160.pdf A list of Capture Wines LLC's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/canb14-11161.pdf A list of Capture Wine Brands' eight largest unsecured creditors is available for free at http://bankrupt.com/misc/canb14-11162.pdf TRIPLANET PARTNERS: Taps Stamell & Schager as Litigation Counsel ---------------------------------------------------------------- TriPlanet Partners, LLC, seeks authority from the U.S. Bankruptcy Court from the Southern District of New York to employ Stamell & Schager, LLP, as its special litigation counsel. As special litigation counsel, Stamel & Schager is expected to render these services: a. represent the Debtor in adversary and other proceedings concerning claims by alleged employers, members or shareholders of amounts due to or due from the Debtor; b. advise in preparing tax returns and appearing before various tax authorities to work out the amount and payment of taxes owed by the Debtor; c. marshal the Debtor's documents and other information in connection with the Debtor's financial statements; and d. performing all other legal services for the Debtor that may be necessary in connection with Roberts' contested claim and any contested claim. Customary rates of the Firm's professionals are: Professional Hourly Rate ------------ ----------- Jared B. Stamell $725 per hour Andrew Goldenberg $475 per hour Paraprofessionals $250 per hour Jared B. Stamell, Esq., attests that his Firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Triplanet Partners LLC Triplanet Partners LLC filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 14-22643) on May 8, 2014. Sophien Bennaceur signed the petition as manager. The Debtor disclosed $19,946,560 in assets and $33,663,525 in liabilities. Arnold Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck, P.C., serves as the Debtor's counsel. Judge Robert D. Drain oversees the case. TRULAND GROUP: Sued for Wages after Mass Firings ------------------------------------------------ Sherri Toub, substituting for Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that Truland Systems Corp., a Reston, Virginia-based electrical contractor that is winding down operations, was sued on July 30 for two months' wages and benefits by employees who allegedly weren't given sufficient notice before mass firings. According to the report, two former Truland employees who seek to represent the employee class say that the mass firings on or about July 21 didn't comply with the WARN Act, a statute requiring that at least 60-days advance written notice be provided. Truland Group Inc. designs and installs electrical infrastructure. The entities sought Chapter 7 protection after halting operations, according to a report by Daily Bankruptcy Review. The lead voluntary Chapter 7 case is In re The Truland Group Inc., 14-bk-12766, U.S. Bankruptcy Court, Eastern District of Virginia (Alexandria). UPH HOLDINGS: Officially Exited Chapter 11 Protection July 1 ------------------------------------------------------------ UPH Holdings Inc. and its affiliated debtors have officially emerged from bankruptcy protection 15 months after filing. The company said in a court filing that its Chapter 11 plan of reorganization officially took effect on July 1, three months after the U.S. Bankruptcy Court for the Western District of Texas confirmed the plan. As reported by TCR on April 24, the restructuring plan, which was confirmed on March 27, would implement a settlement between UPH's official committee of unsecured creditors and its secured lender, Hercules Technology II, L.P. by establishing a liquidating trust to be funded or vested with all of UPH's assets. The liquidating trustee will liquidate the assets, reconcile outstanding claims, and make distributions to holders of allowed claims pursuant to the terms of the plan and the Liquidating Trust Agreement. On the effective date of the plan, all objections to claims and all causes of action would be preserved and prosecuted by the liquidating trustee. The liquidating trustee may object to the allowance of claims for which liability is disputed for whatever reasons, even if those claims were not scheduled as disputed, contingent or unliquidated. About UPH Holdings UPH Holdings Inc. and several affiliates filed Chapter 11 petitions (Bankr. W.D. Tex. Lead Case No. 13-10570) on March 28, 2013. Judge Tony M. Davis oversees the case. Jennifer Francine Wertz, Esq., and Patricia Baron Tomasco, Esq., at Jackson Walker, L.L.P., serve as the Debtors' counsel. Q Advisors, LLC serves as financial advisors. UPH Holdings disclosed $26,917,341 in assets and $19,705,805 in liabilities as of the Chapter 11 filing. Other affiliates that sought Chapter 11 protection are: Pac-West Telecomm, Inc.; Tex-Link Communications, Inc.; Unipoint Holdings, Inc.; Unipoint Enhanced Services, Inc.; Unipoint Services, Inc.; Nwire LLC; and Peering Partners Communications LLC (Case Nos. 13-10571 to 13-10577). Judy A. Robbins, the United States Trustee for Region 7, has appointed a five-member Official Committee of Unsecured Creditors in the Chapter 11 cases of UPH Holdings, Inc., Pac-West Telecomm Inc., and their affiliated debtors. The Committee tapped Kelley Drye & Warren LLP as its counsel, and QSI Consulting, Inc. as its financial advisor. VYCOR MEDICAL: Boosts Shareholder Equity by $2.4 Million -------------------------------------------------------- Vycor Medical, Inc., announced that its largest shareholder, Fountainhead Capital Management Limited, along with certain other related and non-related parties, has agreed to exchange all of its $2,355,587 of debt into an equivalent amount of preferred equity in the company. This equity exchange will result in Vycor's Shareholders' Equity being increased by $2,355,587, equivalent to the current debt. Following on from the closing in April of a $5 million Common Stock and Warrants Offering at $1.80 per share, this exchange is a significant milestone towards Vycor's objective of seeking an up- listing on a national stock exchange. This exchange is in addition to the conversion by Fountainhead in January 2014 of $1,426,542 of accrued consulting fees into an investment in the Offering, over and above the $5 million raised from investors. Under the terms of the exchange, the Fountainhead Parties will receive $2,355,587 of Vycor Series D preferred shares that will be convertible into Vycor Shares at a price of $2.15. The Series D will carry a dividend of 7% per annum, payable in cash or Series D at the Company's option. The Company is able to redeem the Series D at par at any time, at its sole option. The Fountainhead Parties will also receive 3-year warrants equivalent to 75% of the Vycor Shares received in the exchange on a converted basis, exercisable at $3.08. Full details will be contained in a Form 8-K filing. Under Applicable Accounting Guidance ASC 405 and 470, the exchange is accounted for as an extinguishment of debt. The Company is required to compare the carrying value of the securities being extinguished (without placing any value on security preference, default protection, conversion rights or other matters) with the fair value of the securities being issued in exchange. The fair values are determined using a variety of techniques including as Black-Scholes and Monte Carlo simulation, taking into account stock volatility but not, importantly, stock illiquidity, to derive a theoretical fair value. The securities issued in exchange are then recorded on the balance sheet at this fair value and the difference between fair value of the new securities and the carrying value of the extinguished securities is recognized in the income statement as a gain or loss. Vycor's Board commissioned an independent party to carry out a valuation of the securities. Under the terms of the exchange, the total theoretical fair value of the new securities (Series D and warrants) is approximately $3,000,000 compared to the carrying value of the debt of $2,355,587. This results in a theoretical cost of debt extinguishment of approximately $645,000. The net impact, however, is to increase Shareholder's Equity by $2,355,587, equivalent to the current debt. Adrian Liddell, the chairman of Vycor, commented: "This transaction was carefully reviewed by outside counsel and based on their expertise the Audit Committee and Board of Directors of Vycor consider this exchange as very beneficial to the Company, considerably strengthening the balance sheet, and in the best interests of all shareholders." At the same time, in a transaction not related to the exchange, Fountainhead entered into an agreement with the Company preventing it from selling any Vycor Shares currently held by Fountainhead below $4.50. In return, the Company agreed to extend the life of certain of Fountainhead's existing warrants expiring in 2015 to the same 3-year term as the warrants being issued under the exchange. About Vycor Medical Boca Raton, Fla.-based Vycor Medical, Inc. (OTC BB: VYCO) -- http://www.VycorMedical.com/-- is a medical device company committed to making neurological brain, spinal and other surgical procedures safer and more effective. The Company's flagship, Patent Pending ViewSite(TM) Surgical Access Systems represent an exciting new minimally invasive access and retraction system that holds the potential for speedier, safer and more economical brain, spinal and other surgeries and a quicker patient discharge. Vycor's innovative medical instruments are designed to optimize neurosurgical site access, reduce patient risk, accelerate recovery, and add tangible value to the professional medical community. Vycor Medical reported a net loss of $2.47 million on $1.08 million of revenue for the year ended Dec. 31, 2013, as compared with a net loss of $2.93 million on $1.20 million of revenue for the year ended Dec. 31, 2012. The Company's balance sheet at March 31, 2014, showed $4.86 million in total assets, $5.10 million in total liabilities and a $247,332 total stockholders' deficiency. YELLOWSTONE MOUNTAIN: Founder Fights Contempt At 9th Circ. ---------------------------------------------------------- Law360 reported that the founder of the Yellowstone Mountain Club ski resort urged a Ninth Circuit panel to overturn a judge's finding of contempt against him for selling a Mexico resort property included in the company's bankruptcy in defiance of an injunction, arguing the injunction wasn't valid. According to the report, during a hearing in Pasadena, California, Timothy L. Blixseth's attorney Philip Stillman of Stillman & Associates argued that the injunction stipulated to by both parties was "facially invalid" and could be retroactively challenged, even after it had been violated. However, an attorney for Yellowstone liquidation trustee Brian Glasser shot back that the injunction was valid because both parties had agreed to it and the finding of contempt was well-earned, the report related. The cases are Brian Glasser v. Timothy Blixseth et al., case number 14-35159, and Brian Glasser v. Timothy Blixseth, case number 14-35160, in the U.S. Court of Appeals for the Ninth Circuit. About Yellowstone Mountain Located near Big Sky, Montana, Yellowstone Mountain Club LLC -- http://www.theyellowstoneclub.com/-- is a private golf and ski community with more than 350 members, including Bill Gates and Dan Quayle. The Company was founded in 1999. Yellowstone Club and its affiliates filed for Chapter 11 bankruptcy (Bankr. D. Montana, Case No. 08-61570) on Nov. 10, 2008. The Company's owner affiliate, Edra D. Blixseth, filed a separate Chapter 11 petition on March 27, 2009 (Case No. 09-60452). Attorneys at Bullivant Houser Bailey PC and Bekkedahl & Green PLLC represented Yellowstone. The Debtors hired FTI Consulting Inc. and Ronald Greenspan as CRO. The official committee of unsecured creditors were represented by Parsons, Behle and Latimer; and James H. Cossitt, Esq., as counsel. Credit Suisse, the prepetition first lien lender, was represented by Skadden, Arps, Slate, Meagher & Flom. In June 2009, the Bankruptcy Court entered an order confirming Yellowstone's Chapter 11 Plan. Pursuant to the Plan, CrossHarbor Capital Partners LLC acquired equity ownership in the reorganized Club for $115 million. Marc S. Kirschner, Esq., was appointed the Trustee of the Yellowstone Club Liquidating Trust created under the Plan. YONKER INVESTMENTS: Case Summary & 7 Unsecured Creditors -------------------------------------------------------- Debtor: Yonker Investments, Inc. 2001 Whitfield Park Ave. Sarasota, FL 34243 Case No.: 14-09220 Chapter 11 Petition Date: August 8, 2014 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Daniel R. Fogarty, Esq. STICHTER, RIEDEL, BLAIN & PROSSER, PA 110 East Madison Street, Suite 200 Tampa, FL 33602 Tel: (813) 229-0144 Email: dfogarty.ecf@srbp.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Michael B. Yonker, president. A list of the Debtor's seven largest unsecured creditors is available for free at http://bankrupt.com/misc/flmb14-09220.pdf * 9th Circ. Backs Judges' Power To Ban Bankruptcy Advisers ---------------------------------------------------------- Law360 reported that the Ninth Circuit reaffirmed bankruptcy judges' discretion to effectively ban bankruptcy advisers in whom they've lost trust, refusing to rebuke an unnamed judge who boxed out an advisory firm that had repeatedly busted fee caps. According to the report, Chief Judge Alex Kozinski, writing for the appeals court, said comments from the judge didn't rise to the level of personal animosity and didn't evince an impermissible motive against a financial group that "substantially exceeded" its fee caps "almost every month it was retained." * Bill Would Let "Medically Distressed" Cast Off Student Loans -------------------------------------------------------------- Katy Stech, writing for The Wall Street Journal, reported that a Rhode Island lawmaker has introduced the Medical Bankruptcy Fairness Act to allow people to get rid of their student-loan debt if they have paid more than $10,000 in medical bills during the three years before bankruptcy. According to the report, Sen. Whitehouse's bill would classify people who've spent at least $10,000 on medical bills as "medically distressed debtors" and allow them to discharge student loans without having to convince a bankruptcy judge that they can't afford to repay them, as the process now requires. * July 2014 Chapter 11 Filings Fall 34% From Last Year ------------------------------------------------------ ABL Advisor reported that total bankruptcy filings in the United States decreased 12% in July 2014 over July of last year, according to data provided by Epiq Systems, Inc. The report, however, noted that the filings for July represented a 5% percent increase compared to the 73,835 total filings in June 2014. According to the report: -- Bankruptcy filings totaled 77,469 in July 2014, down from the July 2013 total of 87,746. -- Consumer filings declined 11% to 74,595 from the July 2013 consumer filing total of 84,114. -- Total commercial filings in July 2014 decreased to 2,874, representing a 21% decline from the 3,632 business filings recorded in July 2013. -- Total commercial chapter 11 filings dipped 34% to 357 filings in July 2014 from the 539 commercial chapter 11 filings registered in July 2013. * After FDIC D&O Battles, Redrawing Exclusion No Easy Task ---------------------------------------------------------- Law360 reported that courts aren't seeing eye-to-eye on whether the "insured v. insured" exclusion wipes out coverage for the directors and officers of failed banks in widespread litigation against the Federal Deposit Insurance Corp., but insurers that try to tighten up their policy language are likely to encounter resistance from brokers and other setbacks, experts say. According to the report, the exclusion, which applies to claims brought by one insured against another, has been front and center in the latest wave of coverage disputes over FDIC lawsuits. * Consumer Spending in U.S. Rose in June by Most in Three Months ---------------------------------------------------------------- Victoria Stilwell, writing for Bloomberg News, reported that consumer spending in the U.S. rose in June by the most in three months, ending the quarter on a strong note and signaling that continued job growth will bolster the world's largest economy. According to the report, household purchases, which account for about 70 percent of the economy, climbed 0.4 percent after a 0.3 percent gain in May that was larger than previously estimated, Commerce Department figures showed. The increased matched the median forecast of 74 economists in a Bloomberg survey. * Credit Rating Suit Against S&P, Others Goes To State Court ------------------------------------------------------------ Law360 reported that a New York federal judge remanded to state court a suit alleging Standard & Poor's Financial Services LLC, Moody's Investors Service Inc. and Fitch Ratings Inc. of artificially boosting securitized debt ratings in the run-up to the financial crisis, finding the case did not necessarily implicate federal law. According to the report, U.S. District Judge Lorna G. Schofield found that the claims brought by plaintiffs Geoffrey Varga and Mark Longbottom -- Bear Stearns & Co. Inc. hedge fund liquidators -- can be settled via New York state law. The case is Varga et al v. McGraw Hill Financial, Inc. et al., Case No. 1:13-cv-08743 (S.D.N.Y.). * Debt Collectors under Fire by Regulator ----------------------------------------- Alan Zibel and Jacob Gershman, writing for The Wall Street Journal, reported that a U.S. financial regulator could upend the business model of law firms that file waves of cookie-cutter lawsuits to collect money from people who haven't paid their bills. According to the report, the U.S. Consumer Financial Protection Bureau last month filed its first lawsuit against a debt- collection firm, Marietta, Ga.-based Frederick J. Hanna & Associates, accusing it of violating federal consumer-protection laws. The CPFB's case, filed in federal court in Georgia, accused Hanna & Associates of churning out more than 350,000 credit card collection complaints against consumers, some of whom may owe nothing or owed less than was claimed, the report related. * Fed, FDIC Boards Blast Big Banks' 'Living Wills' -------------------------------------------------- Law360 reported that U.S. financial regulators said that they have completed reviewing 11 resolution plans describing strategies in the event of financial distress -- also known as "living wills" -- submitted by JPMorgan Chase & Co. and other big banks, and have identified several "specific shortcomings" with the plans. According to the report, the Board of Governors of the Federal Reserve System and the Board of Directors of the Federal Deposit Insurance Corp. completed their reviews of the second round of resolution plans submitted in 2013, laying out issues that should be addressed in the 2015 submissions. The 11 firms in the first group of filers included JPMorgan, Bank of America Corp., The Bank of New York Mellon Corp., Barclays PLC, Citigroup Inc., Credit Suisse Group AG, Deutsche Bank AG, Goldman Sachs Group Inc. and others, Law360 said, citing the agencies. * Hirings Up, Federal Reserve May Raise Interest Rates ------------------------------------------------------ Christopher S. Rugaber, writing for The Associated Press, reported that the pressure is rising for the Federal Reserve to raise interest rates to prevent a strengthening economy from igniting inflation with employers ramping up hiring and the unemployment rate sinking in. According to the report, employers have added an average 244,000 jobs a month since February -- the best six-month hiring spree in eight years. * U.S. Starts Civil Inquiry of Subprime Car Lending --------------------------------------------------- Michael Corkery and Jessica Silver-Greenberg, writing for The New York Times' DealBook, reported that federal prosecutors have begun a civil investigation into the booming business of subprime auto lending, focusing on the packaging and selling of questionable loans to investors. According to the report, the inquiry is being undertaken amid worries among some regulators that checks and standards are being neglected as the subprime auto loan market surges, in a small, yet disturbing, echo of the subprime mortgage crisis. * Capital Restructure Provides Financing to Chapter 11 Company -------------------------------------------------------------- Capital Restructure Group, a Bankruptcy Advisor and expert in Commercial Loan Modifications, CMBS Loan modifications and Chapter 11 finance on Aug. 8 announced the funding of a $1M low interest rate loan to refinance the assets of a freight company that had previously been in Chapter 11. Capital Restructure Group has nurtured relationships with financial institutions that have now entered the lending market to make low interest rate loan to companies and real estate projects whose owners have previously filed Chapter 11. Capital Restructure Group has been consulting to Business Chapter 11's and Real Estate Chapter 11's with assets from $500,000 to $75M for 25 years and is a Chapter 11 expert, with a nationwide track-record in negotiating complex bank debt restructures and in navigating the intricacies of the Chapter 11. The Company has successfully negotiated CMBS loan modifications and commercial loan modifications with the largest banks and financial institutions in the United States as well as small regional banks private lenders and credit unions. Its principals have restructured their own businesses and real estate projects through Chapter 11 and bring a combined 115 years of business, ownership, real estate development, investment and finance experience to the table for their clients. * Troutman Sanders Adds Bankruptcy Group in New York ---------------------------------------------------- Troutman Sanders LLP announced on Aug. 4 that a group of four partners with substantial experience in commercial bankruptcy and litigation, restructuring and creditors' rights has joined the firm in its New York office. Hugh McDonald, Jonathan Forstot, Esq. -- jonathan.forstot@troutmansanders.com -- Patrick Fitzmaurice, Esq. -- patrick.fitzmaurice@troutmansanders.com -- and Louis Curcio, Esq. -- louis.curcio@troutmansanders.com -- are joining Troutman Sanders from Dentons in New York. The group, which has been practicing together for a number of years, has extensive experience in representing lenders, distressed debt purchasers, servicers, trustees, and other financial institutions in a wide variety of commercial matters. The group joins Troutman Sanders at a time of significant expansion. With today's announcement, the firm has added 11 new partners to the New York office in the past 12 months. The firm also recently announced that it has signed a 15-year lease for new office space at 875 Third Avenue in Midtown. "This is a great addition for us in New York on a number of levels," said David Dantzler, managing partner of the firm's New York office. "We are not only continuing to grow our New York office, which is a focal point of the firm's strategic plan, but also strengthening our ability to represent our financial institution clients in New York and across the country." "The strengths that Hugh, Jon, Patrick and Louis bring to our firm align perfectly with the direction we want to take with our firm- wide bankruptcy practice," said Bill Withrow, chair of the firm's Litigation department. "In particular, they help increase the litigation capabilities we can offer to our clients. We are thrilled to welcome them, here." "Given Troutman Sanders' platform and reputation, we felt that this was a great opportunity to grow our practice and expand the services we offer to clients," said McDonald. "We believe that our practice fits very well with the firm's focus on complex commercial matters and we are extremely happy to be here." McDonald is a graduate of New York Law School; Forstot received his law degree from Boston University School of Law; Fitzmaurice is a graduate of Brooklyn Law School; and, Curcio is a graduate of St. John's University School of Law. About Troutman Sanders Troutman Sanders LLP is an international law firm with more than 600 lawyers practicing in offices located throughout the United States and Asia. Founded in 1897, the firm's lawyers provide counsel and advice in practically every aspect of civil and commercial law related to the firm's core practice areas: Corporate, Energy and Industry Regulation, Finance, Litigation and Real Estate. Firm clients range from multinational corporations to individual entrepreneurs, federal and state agencies to foreign governments, and non-profit organizations to businesses representing virtually every sector and industry. See troutmansanders.com for more information. * Large Companies With Insolvent Balance Sheet ---------------------------------------------- Total Share- Total Total Holders' Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ -------- ------- ABSOLUTE SOFTWRE ALSWF US 118.9 (8.4) 1.0 ABSOLUTE SOFTWRE OU1 GR 118.9 (8.4) 1.0 ABSOLUTE SOFTWRE ABT CN 118.9 (8.4) 1.0 ACHAOGEN INC AKAO US 13.8 (0.0) 2.1 ACTINIUM PHARMAC ATNM US 6.6 (13.5) (13.5) ADVANCED EMISSIO ADES US 106.4 (46.1) (15.3) ADVANCED EMISSIO OXQ1 GR 106.4 (46.1) (15.3) ADVENT SOFTWARE ADVS US 452.2 (86.0) (99.3) ADVENT SOFTWARE AXQ GR 452.2 (86.0) (99.3) AEMETIS INC AMTX US 99.4 (4.2) (14.6) AEROHIVE NETWORK 2NW GR 69.1 (5.2) 26.7 AEROHIVE NETWORK HIVE US 69.1 (5.2) 26.7 AIR CANADA-CL A AIDIF US 10,522.0 (1,822.0) (226.0) AIR CANADA-CL A ADH GR 10,522.0 (1,822.0) (226.0) AIR CANADA-CL A ADH TH 10,522.0 (1,822.0) (226.0) AIR CANADA-CL A AC/A CN 10,522.0 (1,822.0) (226.0) AIR CANADA-CL B AIDEF US 10,522.0 (1,822.0) (226.0) AIR CANADA-CL B AC/B CN 10,522.0 (1,822.0) (226.0) ALDER BIOPHARMAC ALDR US 16.6 (37.2) (8.4) ALDER BIOPHARMAC ALDR1EUR EU 16.6 (37.2) (8.4) ALDER BIOPHARMAC 3A9 GR 16.6 (37.2) (8.4) ALLIANCE HEALTHC AIQ US 465.3 (136.6) 59.5 AMC NETWORKS-A 9AC GR 3,484.7 (478.3) 642.3 AMC NETWORKS-A AMCX US 3,484.7 (478.3) 642.3 AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2) AMYLIN PHARMACEU AMLN US 1,998.7 (42.4) 263.0 AMYRIS INC AMRS US 236.8 (112.5) 33.5 ANGIE'S LIST INC 8AL GR 128.4 (36.6) (54.9) ANGIE'S LIST INC 8AL TH 128.4 (36.6) (54.9) ANGIE'S LIST INC ANGI US 128.4 (36.6) (54.9) ARRAY BIOPHARMA ARRY US 135.2 (23.3) 72.2 ASPEN AEROGELS I ASPN US 88.2 (80.7) (5.2) AUTOZONE INC AZO US 7,371.8 (1,808.2) (1,016.1) AUTOZONE INC AZ5 TH 7,371.8 (1,808.2) (1,016.1) AUTOZONE INC AZ5 GR 7,371.8 (1,808.2) (1,016.1) AVALANCHE BIOTEC AVU GR 1.1 (0.7) (0.9) AVALANCHE BIOTEC AAVL US 1.1 (0.7) (0.9) BERRY PLASTICS G BERY US 5,419.0 (118.0) 654.0 BERRY PLASTICS G BP0 GR 5,419.0 (118.0) 654.0 BIOCRYST PHARM BO1 GR 43.4 (5.7) 22.0 BIOCRYST PHARM BCRX US 43.4 (5.7) 22.0 BIOCRYST PHARM BO1 TH 43.4 (5.7) 22.0 BRP INC/CA-SUB V B15A GR 2,019.7 (17.0) 172.7 BRP INC/CA-SUB V BRPIF US 2,019.7 (17.0) 172.7 BRP INC/CA-SUB V DOO CN 2,019.7 (17.0) 172.7 BURLINGTON STORE BURL US 2,547.8 (136.3) 124.8 BURLINGTON STORE BUI GR 2,547.8 (136.3) 124.8 CABLEVISION SY-A CVY GR 6,701.1 (5,133.2) 338.4 CABLEVISION SY-A CVC US 6,701.1 (5,133.2) 338.4 CABLEVISION-W/I 8441293Q US 6,701.1 (5,133.2) 338.4 CABLEVISION-W/I CVC-W US 6,701.1 (5,133.2) 338.4 CAESARS ENTERTAI CZR US 24,376.7 (2,276.8) 566.0 CAESARS ENTERTAI C08 GR 24,376.7 (2,276.8) 566.0 CALLIDUS CAPITAL CBL CN 444.5 (4.3) - CALLIDUS CAPITAL 28K GR 444.5 (4.3) - CAPMARK FINANCIA CPMK US 20,085.1 (933.1) - CASELLA WASTE CWST US 649.9 (8.5) (18.9) CATALENT INC CTLT US 3,041.6 (387.0) 268.2 CC MEDIA-A CCMO US 14,752.2 (9,315.2) 1,225.6 CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1) CENVEO INC CVO US 1,206.8 (511.7) 145.0 CHOICE HOTELS CHH US 628.4 (412.5) 160.7 CHOICE HOTELS CZH GR 628.4 (412.5) 160.7 CIENA CORP CIE1 GR 1,795.5 (80.8) 641.3 CIENA CORP CIEN TE 1,795.5 (80.8) 641.3 CIENA CORP CIEN US 1,795.5 (80.8) 641.3 CIENA CORP CIE1 TH 1,795.5 (80.8) 641.3 CINCINNATI BELL CBB US 2,101.5 (670.7) 7.7 CROWN BAUS CAPIT CBCA US 0.0 (0.0) (0.0) DENNY'S CORP DENN US 284.2 (0.0) (21.5) DENNY'S CORP DE8 GR 284.2 (0.0) (21.5) DEX MEDIA INC DXM US 2,275.0 (782.0) 162.0 DEX MEDIA INC 9DX GR 2,275.0 (782.0) 162.0 DIRECTV DIG1 GR 22,126.0 (6,127.0) (624.0) DIRECTV DTV US 22,126.0 (6,127.0) (624.0) DIRECTV DTV CI 22,126.0 (6,127.0) (624.0) DOMINO'S PIZZA EZV TH 495.7 (1,289.7) 105.0 DOMINO'S PIZZA EZV GR 495.7 (1,289.7) 105.0 DOMINO'S PIZZA DPZ US 495.7 (1,289.7) 105.0 DUN & BRADSTREET DNB US 1,773.4 (1,077.1) (60.3) DUN & BRADSTREET DB5 GR 1,773.4 (1,077.1) (60.3) EDGEN GROUP INC EDG US 883.8 (0.8) 409.2 ELEVEN BIOTHERAP EBIO US 5.1 (6.1) (2.9) EMPIRE RESORTS I NYNY US 38.7 (14.0) (14.6) EMPIRE STATE -ES ESBA US 1,122.2 (31.6) (925.9) EMPIRE STATE-S60 OGCP US 1,122.2 (31.6) (925.9) FAIRPOINT COMMUN FONN GR 1,546.4 (338.8) 25.3 FAIRPOINT COMMUN FRP US 1,546.4 (338.8) 25.3 FERRELLGAS-LP FEG GR 1,589.9 (88.9) 89.0 FERRELLGAS-LP FGP US 1,589.9 (88.9) 89.0 FIVE9 INC 1F9 GR 69.2 (9.0) (1.9) FIVE9 INC FIVN US 69.2 (9.0) (1.9) FREESCALE SEMICO 1FS TH 3,265.0 (3,728.0) 1,334.0 FREESCALE SEMICO FSL US 3,265.0 (3,728.0) 1,334.0 FREESCALE SEMICO 1FS GR 3,265.0 (3,728.0) 1,334.0 GAMING AND LEISU 2GL GR 2,581.7 (72.9) (41.1) GAMING AND LEISU GLPI US 2,581.7 (72.9) (41.1) GENCORP INC GCY TH 1,675.6 (49.0) 86.7 GENCORP INC GCY GR 1,675.6 (49.0) 86.7 GENCORP INC GY US 1,675.6 (49.0) 86.7 GENTIVA HEALTH GHT GR 1,234.9 (297.6) 99.2 GENTIVA HEALTH GTIV US 1,234.9 (297.6) 99.2 GLG PARTNERS INC GLG US 400.0 (285.6) 156.9 GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9 GLOBALSTAR INC GSAT US 1,350.0 (74.3) (97.3) GLORI ENERGY INC GLRI US 0.1 (0.0) - GOLD RESERVE INC GDRZF US 21.5 (5.6) 1.2 GOLD RESERVE INC GRZ CN 21.5 (5.6) 1.2 GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5 GTT COMMUNICATIO GTT US 168.5 (0.1) (25.3) HCA HOLDINGS INC HCA US 29,822.0 (6,588.0) 2,877.0 HCA HOLDINGS INC 2BH TH 29,822.0 (6,588.0) 2,877.0 HCA HOLDINGS INC 2BH GR 29,822.0 (6,588.0) 2,877.0 HD SUPPLY HOLDIN 5HD GR 6,552.0 (750.0) 1,446.0 HD SUPPLY HOLDIN HDS US 6,552.0 (750.0) 1,446.0 HERBALIFE LTD HLF US 2,435.7 (404.1) 552.4 HERBALIFE LTD HOO GR 2,435.7 (404.1) 552.4 HORIZON PHARMA I HPM GR 299.1 (229.2) 93.2 HORIZON PHARMA I HZNP US 299.1 (229.2) 93.2 HORIZON PHARMA I HPM TH 299.1 (229.2) 93.2 HOVNANIAN ENT-A HOV US 1,838.8 (462.5) 1,122.1 HOVNANIAN ENT-B HOVVB US 1,838.8 (462.5) 1,122.1 HOVNANIAN-A-WI HOV-W US 1,838.8 (462.5) 1,122.1 HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8) HUGHES TELEMATIC HUTC US 110.2 (101.6) (113.8) IMPRIVATA INC IMPR US 35.6 (4.3) (10.8) IMPRIVATA INC I62 GR 35.6 (4.3) (10.8) INCYTE CORP ICY TH 679.1 (171.0) 464.6 INCYTE CORP ICY GR 679.1 (171.0) 464.6 INCYTE CORP INCY US 679.1 (171.0) 464.6 INFOR US INC LWSN US 6,515.2 (555.7) (303.6) INTERCEPT PHARMA ICPT US 141.9 (153.7) (148.2) INTERCEPT PHARMA I4P TH 141.9 (153.7) (148.2) INTERCEPT PHARMA I4P GR 141.9 (153.7) (148.2) IPCS INC IPCS US 559.2 (33.0) 72.1 ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2 JUST ENERGY GROU JE CN 1,642.6 (117.4) 221.0 JUST ENERGY GROU 1JE GR 1,642.6 (117.4) 221.0 JUST ENERGY GROU JE US 1,642.6 (117.4) 221.0 KINAXIS INC KXS CN 44.6 (70.4) (6.4) KINAXIS INC KXSCF US 44.6 (70.4) (6.4) L BRANDS INC LB US 6,663.0 (609.0) 1,070.0 L BRANDS INC LTD GR 6,663.0 (609.0) 1,070.0 L BRANDS INC LTD TH 6,663.0 (609.0) 1,070.0 LEAP WIRELESS LEAP US 4,662.9 (125.1) 346.9 LEAP WIRELESS LWI TH 4,662.9 (125.1) 346.9 LEAP WIRELESS LWI GR 4,662.9 (125.1) 346.9 LEE ENTERPRISES LEE US 797.3 (155.6) 0.8 LEE ENTERPRISES LE7 GR 797.3 (155.6) 0.8 LORILLARD INC LLV TH 2,893.0 (2,228.0) 900.0 LORILLARD INC LLV GR 2,893.0 (2,228.0) 900.0 LORILLARD INC LO US 2,893.0 (2,228.0) 900.0 LUMENPULSE INC 0L6 GR 29.4 (38.4) 3.5 LUMENPULSE INC LMPLF US 29.4 (38.4) 3.5 LUMENPULSE INC LMP CN 29.4 (38.4) 3.5 MARRIOTT INTL-A MAQ GR 6,830.0 (1,720.0) (1,153.0) MARRIOTT INTL-A MAQ TH 6,830.0 (1,720.0) (1,153.0) MARRIOTT INTL-A MAR US 6,830.0 (1,720.0) (1,153.0) MDC PARTNERS-A MD7A GR 1,685.0 (87.5) (228.9) MDC PARTNERS-A MDZ/A CN 1,685.0 (87.5) (228.9) MDC PARTNERS-A MDCA US 1,685.0 (87.5) (228.9) MERITOR INC AID1 GR 2,810.0 (527.0) 373.0 MERITOR INC MTOR US 2,810.0 (527.0) 373.0 MERRIMACK PHARMA MP6 GR 165.0 (65.8) 81.9 MERRIMACK PHARMA MACK US 165.0 (65.8) 81.9 MICHAELS COS INC MIM GR 1,716.0 (2,734.0) 493.0 MICHAELS COS INC MIK US 1,716.0 (2,734.0) 493.0 MONEYGRAM INTERN MGI US 4,784.5 (142.0) 119.2 MORGANS HOTEL GR MHGC US 695.2 (202.0) 129.7 MORGANS HOTEL GR M1U GR 695.2 (202.0) 129.7 MOXIAN CHINA INC MOXC US 0.0 (0.0) (0.0) MPG OFFICE TRUST MPG US 1,280.0 (437.3) - NATIONAL CINEMED XWM GR 1,005.2 (188.3) 79.1 NATIONAL CINEMED NCMI US 1,005.2 (188.3) 79.1 NAVISTAR INTL NAV US 7,727.0 (4,072.0) 1,070.0 NAVISTAR INTL IHR TH 7,727.0 (4,072.0) 1,070.0 NAVISTAR INTL IHR GR 7,727.0 (4,072.0) 1,070.0 NEKTAR THERAPEUT ITH GR 478.1 (35.4) 213.9 NEKTAR THERAPEUT NKTR US 478.1 (35.4) 213.9 NEW ENG RLTY-LP NEN US 180.1 (23.2) - NII HOLDING INC NIHD* MM 8,189.7 (8.8) 1,078.9 NORTHWEST BIO NBYA GR 12.5 (31.1) (31.2) NORTHWEST BIO NWBO US 12.5 (31.1) (31.2) NYMOX PHARMACEUT NYMX US 0.9 (6.3) (3.8) OMTHERA PHARMACE OMTH US 18.3 (8.5) (12.0) OPOWER INC OPWR US 63.1 (6.3) (11.9) OPOWER INC 38O TH 63.1 (6.3) (11.9) OPOWER INC 38O GR 63.1 (6.3) (11.9) PALM INC PALM US 1,007.2 (6.2) 141.7 PHIBRO ANIMAL HE PAO GR 473.3 (78.7) 177.3 PHIBRO ANIMAL HE PAO EU 473.3 (78.7) 177.3 PHIBRO ANIMAL HE PAHC LN 473.3 (78.7) 177.3 PHIBRO ANIMAL-A PAHC US 473.3 (78.7) 177.3 PHIBRO ANIMAL-A PB8 GR 473.3 (78.7) 177.3 PHILIP MORRIS IN PM US 36,325.0 (7,847.0) 1,130.0 PHILIP MORRIS IN PMI SW 36,325.0 (7,847.0) 1,130.0 PHILIP MORRIS IN PM1EUR EU 36,325.0 (7,847.0) 1,130.0 PHILIP MORRIS IN PM1CHF EU 36,325.0 (7,847.0) 1,130.0 PHILIP MORRIS IN PM1 TE 36,325.0 (7,847.0) 1,130.0 PHILIP MORRIS IN 4I1 GR 36,325.0 (7,847.0) 1,130.0 PHILIP MORRIS IN PM FP 36,325.0 (7,847.0) 1,130.0 PHILIP MORRIS IN 4I1 TH 36,325.0 (7,847.0) 1,130.0 PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9) PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9) PLY GEM HOLDINGS PG6 GR 1,033.7 (107.2) 199.4 PLY GEM HOLDINGS PGEM US 1,033.7 (107.2) 199.4 PROTALEX INC PRTX US 2.8 (7.0) 2.3 PROTECTION ONE PONE US 562.9 (61.8) (7.6) QUALITY DISTRIBU QLTY US 443.2 (51.2) 106.0 QUALITY DISTRIBU QDZ GR 443.2 (51.2) 106.0 QUINTILES TRANSN QTS GR 2,978.6 (621.6) 511.6 QUINTILES TRANSN Q US 2,978.6 (621.6) 511.6 RADIUS HEALTH IN 1R8 GR 12.8 (24.5) (22.7) RADIUS HEALTH IN RDUS US 12.8 (24.5) (22.7) RADNET INC PQI GR 737.2 (9.3) 61.4 RADNET INC RDNT US 737.2 (9.3) 61.4 REGAL ENTERTAI-A RGC US 2,675.7 (750.5) 26.2 REGAL ENTERTAI-A RETA GR 2,675.7 (750.5) 26.2 RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4) RENTPATH INC PRM US 208.0 (91.7) 3.6 RETROPHIN INC RTRX US 94.0 (35.4) (107.0) RETROPHIN INC 17R GR 94.0 (35.4) (107.0) REVLON INC-A RVL1 GR 2,105.1 (589.0) 248.9 REVLON INC-A REV US 2,105.1 (589.0) 248.9 RITE AID CORP RTA TH 6,946.5 (2,046.4) 1,643.0 RITE AID CORP RTA GR 6,946.5 (2,046.4) 1,643.0 RITE AID CORP RAD US 6,946.5 (2,046.4) 1,643.0 ROCKWELL MEDICAL RMTI US 26.8 (3.5) 8.2 ROCKWELL MEDICAL RWM GR 26.8 (3.5) 8.2 RURAL/METRO CORP RURL US 303.7 (92.1) 72.4 RYERSON HOLDING RYI US 1,989.5 (114.5) 754.6 SABRE CORP 19S GR 4,750.4 (312.9) (279.6) SABRE CORP SABR US 4,750.4 (312.9) (279.6) SABRE CORP 19S TH 4,750.4 (312.9) (279.6) SALLY BEAUTY HOL S7V GR 1,983.6 (362.8) 616.8 SALLY BEAUTY HOL SBH US 1,983.6 (362.8) 616.8 SEQUENOM INC SQNM US 122.9 (58.6) 40.8 SERVICEMASTER GL SVW GR 5,197.0 (369.0) 240.0 SERVICEMASTER GL SERV US 5,197.0 (369.0) 240.0 SILVER SPRING NE 9SI TH 524.4 (97.1) 97.5 SILVER SPRING NE SSNI US 524.4 (97.1) 97.5 SILVER SPRING NE 9SI GR 524.4 (97.1) 97.5 SIRIUS XM CANADA XSR CN 409.2 (78.8) (157.0) SIRIUS XM CANADA SIICF US 409.2 (78.8) (157.0) SPORTSMAN'S WARE 06S GR 272.7 (52.1) 75.1 SPORTSMAN'S WARE SPWH US 272.7 (52.1) 75.1 SUNGAME CORP SGMZ US 2.2 (3.6) (3.9) SUPERVALU INC SJ1 GR 4,354.0 (682.0) 106.0 SUPERVALU INC SVU* MM 4,354.0 (682.0) 106.0 SUPERVALU INC SJ1 TH 4,354.0 (682.0) 106.0 SUPERVALU INC SVU US 4,354.0 (682.0) 106.0 THRESHOLD PHARMA THLD US 94.7 (29.0) 50.3 THRESHOLD PHARMA NZW1 GR 94.7 (29.0) 50.3 TRANSDIGM GROUP TDG US 6,711.0 (1,591.5) 1,073.0 TRANSDIGM GROUP T7D GR 6,711.0 (1,591.5) 1,073.0 TRINET GROUP INC TNETEUR EU 1,340.4 (46.1) 93.8 TRINET GROUP INC TNET US 1,340.4 (46.1) 93.8 TRINET GROUP INC TN3 GR 1,340.4 (46.1) 93.8 TRUPANION INC TRUP US 49.0 (5.5) 7.2 TRUPANION INC TPW GR 49.0 (5.5) 7.2 ULTRA PETROLEUM UPL US 2,958.1 (123.5) (352.9) ULTRA PETROLEUM UPM GR 2,958.1 (123.5) (352.9) UNISYS CORP USY1 GR 2,336.1 (628.5) 369.7 UNISYS CORP UISCHF EU 2,336.1 (628.5) 369.7 UNISYS CORP UIS1 SW 2,336.1 (628.5) 369.7 UNISYS CORP UIS US 2,336.1 (628.5) 369.7 UNISYS CORP UISEUR EU 2,336.1 (628.5) 369.7 UNISYS CORP USY1 TH 2,336.1 (628.5) 369.7 VARONIS SYSTEMS VRNS US 33.7 (1.5) 1.8 VARONIS SYSTEMS VS2 GR 33.7 (1.5) 1.8 VECTOR GROUP LTD VGR GR 1,642.7 (31.1) 560.0 VECTOR GROUP LTD VGR US 1,642.7 (31.1) 560.0 VENOCO INC VQ US 738.2 (130.8) (13.4) VERISIGN INC VRS TH 2,322.6 (632.9) (246.0) VERISIGN INC VRSN US 2,322.6 (632.9) (246.0) VERISIGN INC VRS GR 2,322.6 (632.9) (246.0) VERSO PAPER CORP VRS US 1,062.8 (507.2) 83.6 VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3) WEIGHT WATCHERS WW6 GR 1,526.4 (1,397.9) 13.8 WEIGHT WATCHERS WW6 TH 1,526.4 (1,397.9) 13.8 WEIGHT WATCHERS WTW US 1,526.4 (1,397.9) 13.8 WEST CORP WSTC US 3,876.0 (672.7) 264.3 WEST CORP WT2 GR 3,876.0 (672.7) 264.3 WESTMORELAND COA WME GR 1,407.1 (206.2) (30.5) WESTMORELAND COA WLB US 1,407.1 (206.2) (30.5) XERIUM TECHNOLOG TXRN GR 631.1 (11.8) 104.4 XERIUM TECHNOLOG XRM US 631.1 (11.8) 104.4 YRC WORLDWIDE IN YEL1 TH 2,179.5 (362.4) 201.2 YRC WORLDWIDE IN YRCW US 2,179.5 (362.4) 201.2 YRC WORLDWIDE IN YEL1 GR 2,179.5 (362.4) 201.2 ********* 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. Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine T. Fernandez, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, 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 ***