/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/141107.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, November 7, 2014, Vol. 18, No. 310 Headlines AG-PILOTS INC: Voluntary Chapter 11 Case Summary AGFEED INDUSTRIES: Court Confirms Ch. 11 Liquidation Plan ALLEGHENY TECHNOLOGIES: Moody's Cuts Sr. Unsecured Rating to Ba1 ALLY FINANCIAL: Files Form 10-Q, Posts $423MM Net Income in Q3 ALTEGRITY INC: NSA Contractor Seeks to Cut Debt ANTELOPE VALLEY: Moody's Affirms Ba2 Bond Rating; Outlook Neg. AMERICAN AXLE: Posts $48.6 Million Net Income in Third Quarter ANTELOPE VALLEY: Moody's Assigns Ba2 Rating on New $700MM Notes APOLLO MEDICAL: Acquires Majority Stake in Apollo Palliative ARCAPITA BANK: RA Holding Enters Into Agreement to Sell Lusail BERNARD L. MADOFF: Solus & SPV Not Entitled to Settlement Refund BROADWAY FINANCIAL: Director Renata Simril Quits CANYON COMPANIES: Moody's Affirms B2 Corporate Family Rating CARECORE NATIONAL: Moody's Affirms B2 Corporate Family Rating CAROLINE WYLY: Seeks Ch. 11 Protection in Face of $101M SEC Debt CHANNEL CONSTRUCTION: Alaska Judge Defers Ruling on McGee Fees COMMUNITYONE BANCORP: Posts $1.8-Mil. Net Income in 3rd Quarter CONEX INTERNATIONAL: Trustee Fails in Tax Suit vs. Parent Company CT TECHNOLOGIES: Moody's Assigns B2 Corporate Family Rating CTI BIOPHARMA: Seeking Add'l Capital, May File for Bankruptcy DETROIT, MI: Seeks Court Order Confirming Inapplicability of Stay DIGITAL DOMAIN: To Return $18MM in Tax Credits to Florida DISH DBS: Fitch Assigns 'BB-' Rating on $1.25-Bil. Sr. Notes DISH DBS: Moody's Assigns Ba3 Rating on New $1.25BB Unsec. Notes DISH DBS: S&P Assigns 'BB-' Rating on $1.25BB Sr. Unsecured Notes DOVER DOWNS: Posts $699,000 Net Earnings in Third Quarter DOVER DOWNS: Posts $699,000 Net Earnings in Third Quarter EC SEQUIM: Case Summary & 4 Unsecured Creditors EDGEFIELD INN: Creditor Wins Dismissal of Chapter 11 Case EMMANUEL COLLEGE: Misses Nov. 1 Bond Payment Deadline EMPIRE RESORTS: Stephen Haberkorn Owns 7.9% Equity Stake EMPIRE TOWERS: Clawback Suit Against Bank of Glen Burnie Tossed ENDEAVOUR INT'L: Restructuring Support Agreement Filed ENERGY FUTURE: Posts $49MM Net Income in Third Quarter ENERGY FUTURE: U.S. Trustee Balks at Employment of Ernst & Young EXIDE TECHNOLOGIES: Enters Into Plan Support Pact With Noteholders FALCON STEEL: Committee Seeks to Retain Deloitte as Fin'l Advisor FALCON STEEL: Panel Objects to Exclusive Period Extensions FALCON STEEL: Texas Capital Bank Wants Short Plan Extension FINJAN HOLDINGS: Amends Employment Agreement With CFO FIRED UP: Gets Court Approval to Borrow $450,000 from IBW FOUR OAKS: Imposes Restrictions on Common Stock Transfer FRATERFOOD SERVICE: Landlord's $76K Claim for April Rent Okayed GBG RANCH: Hearing on Case Dismissal Continued Sine Die GENERAL MOTORS: Ignition-Switch Trial Set for January 2016 GLOBAL COMPUTER: Insists No Conflict of Interest for McGuireWoods GLOBAL GEOPHYSICAL: Confirmation Hearing Set for Dec. 9 GREEN EARTH: Registers 65.1 Million Shares for Resale GT ADVANCED: Governmental Units Have Until April 6 to File Claims GT ADVANCED: To Unveal Secret Documents With Apple GREEN BRICK: Completes Acquisition of JBGL for $275 Million GREEN BRICK: Third Point Reports 16.7% Equity Stake HAGOOD RESERVE: Cambridge Properties Starts Tearing Down Project HAMPDEN COUNTY PHYSICIANS: Wants Ch 11 Case Converted to Ch 7 HDGM ADVISORY: Cayman Islands Funds Fret Over Less Cash HERFF JONES: Moody's Puts 'B2' CFR on Review for Downgrade HOVNANIAN ENTERPRISES: Unit Selling $250 Million Senior Notes HRK HOLDINGS: Seeks to Extend Further Exclusivity Periods INERGETICS INC: James Kras Appointed as Director INTERCORP RETAIL: Fitch Affirms 'BB' Issuer Default Rating IPC INT'L: Suit v. Milwaukee Golf Transferred to N.D. Illinois IVANHOE RANCH: Nov. 13 Hearing on Settlement of Creditor Dispute JACKSONVILLE BANCORP: Robert Goldstein Named New Director KEMET CORP: Reports $6.3 Million Net Income in Second Quarter KEMET CORP: Files Third Quarter Form 10-Q LAKELAND INDUSTRIES: Completes $11.1 Million Private Placement LEHMAN BROTHERS: Bankr. Court Disallows Former Employees' Claims LEHMAN BROTHERS: Trustee Mulls Wind-Down of Bankruptcy Estate LEVEL 3: S&P Raises Corp. Credit Rating to 'BB-'; Outlook Stable LINCOLN PARK: S&P Affirms 'BB' Rating on 2010 GOLT Bonds LONESTAR GENERATION: S&P Affirms 'BB-' Rating on Upsized Term Loan LUKEN COMMUNICATIONS: Ends Equity Comms Fight, To Exit Ch. 11 MAMMOTH RESOURCE: Judge to Decide Fate of Company's Bankruptcy MARION ENERGY: Secured Lender Objects to DIP Financing Request MAVERICK INT'L: Case Summary & 20 Largest Unsecured Creditors MEDSOLUTIONS HOLDINGS: Moody's Affirms B2 Corporate Family Rating MICHAEL DILWORTH: Hudson Americas Loses Bid to Lift Stay MILK SPECIALTIES: Moody's Lowers Corporate Family Rating to Caa1 MINT LEASING: Plans to Buy 100% of MotorMax for $30 Million MISSION NEW ENERGY: Had A$809,000 in Cash at September 30 MISSION NEW ENERGY: Had A$809,000 in Cash at September 30 MISSISSIPPI PHOSPHATES: Has Interim $5MM DIP Financing Approval MISSISSIPPI PHOSPHATES: Amends Largest Unsecured Creditors List MISSISSIPPI PHOSPHATES: Seeks to Employ BMC as Claims Agent MISSISSIPPI PHOSPHATES: Has Interim OK to Pay Insurance Premiums MOMENTIVE SPECIALTY: Four Directors Resigned MUD KING: Mazelle Krasoff Seeks to Withdraw as Counsel MUSCLEPHARM CORP: Revises Previously Filed Financial Reports NAARTJIE CUSTOM: Hilco Retained to Sell Naartjie Kids Brand NATROL INC: Bankrupt Vitamin Maker Gets Nod for Nov. 10 Auction NEPHROS INC: Amends 5 Million Shares Prospectus NET TALK.COM: Seeks to Annul President's Action NEW YORK MART: Case Summary & 10 Largest Unsecured Creditors NORTEL NETWORKS: Asks Court to Approve Hewlett-Packard Settlement NNN 3500 MAPLE 26: Wins Confirmation of Joint Chapter 11 Plan OMNICARE INC: S&P Lowers Subordinated Debt Rating to 'B+' ORMET CORP: Gets Nod to Dismiss Chapter 11 Case PENGUIN DRIVE-IN: Manager Gives Up Restaurant; Sale Uncertain PHOENIX REALTY: Bank Lender to Hold Foreclosure Sale on Dec. 5 PINNACLE ENTERTAINMENT: To Spin Off REIT At Investor's Behest POSITIVEID CORP: Signs $234,500 Securities Purchase Agreements PRAYOSHA 1 INC: Case Summary & 20 Largest Unsecured Creditors PRESSURE BIOSCIENCES: Presented at FSXinterlinked Conference RECYCLE SOLUTIONS: Section 341(a) Meeting Scheduled for Dec. 1 REVEL AC: Wants Contract With Chief Operations Officer Rejected REVEL AC: 5th Interim Order Authorizing DIP Financing Entered ROOSTER ENERGY: Moody's Withdraws Caa1 Corporate Family Rating SACHIDANAND INVESTMENTS: Case Summary & 14 Top Unsec. Creditors SAMUEL WYLY: SEC Slams Tycoon's Bankruptcy Budget as "Staggering" SAMUEL WYLY: NY Judge Freezes Billionaire's Foreign Accounts SAN BERNARDINO, CA: Allowed to Reject Firefighters' CBA SCIENTIFIC GAMES: S&P Assigns 'BB-' Rating on New $700MM Sr. Notes SCIENTIFIC GAMES: Files Third Quarter Form 10-Q With SEC SEVEN GENERATIONS: Moody's Hikes Corporate Family Rating to B2 SHASTA ENTERPRISES: Secured Creditor Won't Consent to Cash Use SHASTA ENTERPRISES: Section 341(a) Meeting Set for Dec. 5 SHELBOURNE NORTH: Related Midwest Takes Control of Chicago Spire SIAG AERISYN: $2.6MM Clawback Suit Against SSAB Goes to Trial SIGA TECHNOLOGIES: Posts $240,076,761 Net Loss for Sept. 30 Qtr SIGA TECHNOLOGIES: Stipulation on Cash Use Has Final Approval SIMON WORLDWIDE: Three Lions to Voluntarily Liquidate SKYLINE MANOR: Gets 7th Interim Approval on Cash Collateral Use SON P. DANG: Wrongful Foreclosure Suit Dismissed THEOBLOCK S.A.: Foreclosure Sale Set for Dec. 5 THOMAS JEFFERSON SCHOOL: S&P Cuts Rating on 2008A Bonds to 'D' TIBCO SOFTWARE: S&P Assigns Prelim. 'B-' CCR; Outlook Stable TRUMP ENTERTAINMENT: Bankruptcy Hearing in Name Fight Postponed TRUMP ENTERTAINMENT: Gets Final OK to Fund Case With Icahn Cash TRUMP ENTERTAINMENT: Disclosure Statement Hearing Set for Nov. 14 TSC SIEBER: 5th Cir. Vacates Ruling on $345,000 in Funds TW TELECOM: S&P Lowers CCR to 'BB-' & Removes From Watch U.S. COAL: Add'l Debtors to Have Same Advisors U.S. COAL: JAD Gets Access to Lenders' Collateral Until January U.S. COAL: JAD Access to Caterpillar Collateral Extended UNITEK GLOBAL: Obtains Court Approval for First-Day Motions UNITEK GLOBAL: New Mountain Puts First Lien on Non-Accrual Status VERITEQ CORP: Names Marc Gelberg Chief Accounting Officer VILLAGE AT KNAPP'S: Lormax & Visser Want to Buy Property WALTER ENERGY: Incurs $98.9 Million Net Loss in Third Quarter WALTER ENERGY: Incurs $98.9 Million Net Loss in Third Quarter ZOGENIX INC: Signs Waiver Agreement With Purdue Pharma * Heraldnet.com Reports 8 Snohomish County Bankr. Filings in Sept. * Omaha.com Reports 18 Ch 7 & 3 Ch 13 Filings as of Oct. 31 * American College of Bankruptcy to Induct Peggy Hunt as Fellow * BOOK REVIEW: The Sorcerer's Apprentice - Medical Miracles and Other Disasters ********* AG-PILOTS INC: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Ag-Pilots, Inc. dba Thrash Aviation 676 Highway 481 Pelahatchie, MS 39145 Case No.: 14-03584 Chapter 11 Petition Date: November 5, 2014 Court: United States Bankruptcy Court Southern District of Mississippi (Jackson-3 Divisional Office) Judge: Hon. Edward Ellington Debtor's Counsel: Craig M. Geno, Esq. LAW OFFICES OF CRAIG M. GENO, PLLC 587 Highland Colony Pkwy. Ridgeland, MS 39157 Tel: 601 427-0048 Fax: 601-427-0050 Email: cmgeno@cmgenolaw.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Jimmy Thrash, president. The Debtor did not file a list of its largest unsecured creditors when it filed the petition. AGFEED INDUSTRIES: Court Confirms Ch. 11 Liquidation Plan --------------------------------------------------------- Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the District of Delaware on Nov. 4, 2014, issued a findings of fact, conclusions of law and order confirming AgFeed USA, LLC, et al.'s revised second amended Chapter 11 plan of liquidation, which is supported by the Official Committee of Equity Security Holders. The Debtors, prior to the Nov. 4 confirmation hearing, filed an amended supplement for its Revised Second Amended Chapter 11 Plan. According to BankruptcyData, the Amended Plan Supplement has been amended to include a revised Liquidating Trust Agreement and a reduced Insider Subordinated Claim Reserve, in the amount of $139,000, which is consistent with the settlement agreements with certain parties resolving their objections to the Plan. Law360 reported that the confirmation order was signed after the Debtors said they have settled nearly all of the objections to the plan. As previously reported by The Troubled Company Reporter, the Plan provides for substantive consolidation of the Consolidated AgFeed USA Debtors and the liquidation of the Debtors' assets. The majority of the Debtors' assets have been liquidated, and the Plan provides for the estates' assets to be allocated and distributed to holders of allowed claims and interests. Holders of General Unsecured Claims, estimated to total $3,764,429, will recover 100% of their allowed claims. Holders of secured claims, estimated to total $1,456, and holders of priority non-tax claims, estimated to total $832, will also recover 100% of their allowed claims. Exclusivity Expires Jan. 16 Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the District of Delaware extended the period by which AgFeed USA, LLC, et al., have exclusive right to file a plan until Nov. 17, 2014, and the period by which they have exclusive right to solicit acceptances of that plan until Jan. 16, 2015. Judge Shannon on Nov. 4, 2014, issued an order confirming the Debtors' revised second amended Chapter 11 plan of liquidation, which is supported by the Official Committee of Equity Security Holders. About AgFeed Industries AgFeed Industries, Inc., has 21 farms and five feed mills in China producing more than 250,000 hogs annually. In the U.S., the business included 10 sow farms in three states and two feed mills producing more than one million hogs a year. AgFeed's revenue in 2012 was $244 million. AgFeed and its affiliates filed voluntary petitions under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 13-11761) on July 15, 2013, with a deal to sell most of its subsidiaries to The Maschhoffs, LLC, for cash proceeds of $79 million, absent higher and better offers. The Debtors estimated assets of at least $100 million and debts of at least $50 million. Keith A. Maib signed the petition as chief restructuring officer. Hon. Brendan Linehan Shannon presides over the case. Donald J. Bowman, Jr., and Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor, serve as the Debtors' counsel. BDA Advisors Inc. acts as the Debtors' financial advisor. The Debtors' claims and noticing agent is BMC Group, Inc. The U.S. Trustee has appointed a five-member official committee of unsecured creditors to the Chapter 11 cases. The Creditors' Committee tapped Lowenstein Sandler as lead bankruptcy counsel and Greenberg Traurig, LLP, as co-counsel. CohnReznick LLP serves as the Creditors' Committee's financial advisor. An official committee of equity security holders was also appointed to the Chapter 11 cases. The Equity Committee tapped Sugar Felsenthal Grais & Hammer LLP and Elliott Greenleaf as co-counsel. Jefferies Leveraged Credit Products and Claims Recovery Group are represented by Lawrence J. Kotler, Esq., and Catherine B. Heitzenrater, Esq., at Duane Morris, LLP. ALLEGHENY TECHNOLOGIES: Moody's Cuts Sr. Unsecured Rating to Ba1 ---------------------------------------------------------------- Moody's Investors Service downgraded the senior unsecured ratings of Allegheny Technologies Inc. (ATI) and Allegheny Ludlum Corporation (guaranteed by ATI) to Ba1 from Baa3. At the same time, Moody's assigned a Ba1 Corporate Family Rating (CFR), a Ba1- PD probability of default rating and a SGL-2 speculative grade liquidity rating to ATI. The rating outlook is stable. This concludes the review for downgrade initiated on August 28, 2014. The downgrade reflects Moody's expectation that despite ATI's good market positions, technological competencies and favorable long term contracts, particularly in the aerospace industry, a return to financial metrics appropriate for an investment grade company, on a sustainable basis, is unlikely until at least late 2016 or into 2017. Current key metrics such as EBIT/interest and debt/EBITDA of 0.4x and 7.7x respectively (reflecting Moody's standard adjustments) for the twelve months ended September 30, 2014 are expected to show only slow improvement through 2015 and into 2016 given various push outs on jet engine programs and ramp up and costs associated with the hot rolling and processing facility (HRPF) and the titanium sponge facility at Rowley. Additionally, ATI's degree of improvement remains vulnerable to the aero build rate and projects in the oil and gas industry, which could slow given current market conditions and the recent drop in oil prices, which if sustained could result in project delays. While ATI has recently announced the signing of two important long term agreements (LTA's) for jet engine programs, Moody's believe that the benefit of these agreements will flow through to earnings performance over an extended time frame. Given where ATI stands on the aero build rate in terms of product supply and likely slowing of oil and gas projects, EBIT/interest is expected to remain below 2.5x and debt/EBITDA above 4x through most of 2016. Assignments: Issuer: Allegheny Technologies Incorporated Corporate Family Rating, Assigned Ba1 Probability of Default Rating, Assigned Ba1-PD Speculative Grade Liquidity Rating, Assigned SGL-2 Downgrades: Issuer: Allegheny Technologies Incorporated Multiple Seniority Shelf May 29, 2015, Downgraded to (P)Ba1 from (P)Baa3 Senior Unsecured Regular Bond/Debenture Jun 1, 2019, Downgraded to Ba1, LGD4 from Baa3 Senior Unsecured Regular Bond/Debenture Jan 15, 2021, Downgraded to Ba1, LGD4 from Baa3 Senior Unsecured Regular Bond/Debenture Aug 15, 2023, Downgraded to Ba1, LGD4 from Baa3 Outlook Actions: Issuer: Allegheny Technologies Incorporated Outlook, Changed To Stable Downgrades: Issuer: Allegheny Ludlum Corporation Senior Unsecured Regular Bond/Debenture Dec 15, 2025, Downgraded to Ba1, LGD4 from Baa3 Outlook Actions: Issuer: Allegheny Ludlum Corporation Outlook, Changed To Stable Ratings Rationale ATI's Ba1 CFR reflects the company's position as a leading producer of specialty titanium and titanium alloys, nickel-based alloys and super alloys and its technological capabilities, which provide the company with the ability to fulfill customers' unique product requests. Through ATI Forged Products, the company also has capabilities in forging, casting and machining, particularly to the aerospace industry. In addition, the company's increasing global footprint provides greater diversity to its customer base and earnings generation. The Ba1 CFR rating incorporates Moody's expectation for improving profitability and strengthening debt protection metrics as well as adequate cash flow generation to cover requirements through the economic cycle although over a time horizon that extends well into 2016. However, Moody's expect that the return to more robust metrics will occur gradually, driven by continued strengthening in higher value-added product sales and strength in the aerospace markets, a key end market for the company. Given the importance of the jet engine market to improved performance, and the slower build out rate, this is likely to take time to translate into improved earnings performance. In addition , while the ramp up of the HRPF facility continues as well as the Rowley titanium sponge facility will contribute to inefficiencies over the near term, the moderation in capital expenditures will contribute to an improving cash flow generation position. Other factors captured in the rating include the volatility of the company's end markets and its relatively moderate size. The Ba1 rating on the senior unsecured instruments under Moody's loss given default methodology reflects the fact that these debt instruments are at parity in the capital structure with other debt instruments. Should the revolving credit facility become secured, as provided for in the recent amendment to this facility, the unsecured note ratings could be negatively impacted. The SGL-2 speculative grade liquidity rating reflects the company's $264 million cash position at September 30, 2014 and availability under its $400 million revolving credit facility expiring May 31, 2018 (unused at September 30, 2014). The company amended the revolving credit facility in October 2014 to adjust the leverage and interest coverage ratios. In addition the amendment included a springing lien on receivables and inventory should, among other factors, the company be rated below investment grade by both Moody's and Standard and Poor's. Given ATI's liquidity availability, minimal debt maturity profile, and reduced capital expenditures, the company is expected to be able to cover requirements within its overall liquidity profile although free cash flow could be modestly negative. The stable outlook reflects Moody's expectations that the severe downward deterioration has bottomed and that earnings performance and cash flow generation will slowly improve over the next twelve to eighteen months. The outlook also reflects ATI's good contract position and customer relationships, which will lead to improving performance as requirements for the company's products increases over this time frame. Given the expectation for only a gradual improvement in financial metrics, a rating upgrade is unlikely over the next twelve to eighteen months. However, the ratings could be positively impacted should debt/EBITDA be sustainable at no more than 3x, the EBIT margin reach and be sustainable at 8% and (operating cash flow less dividends)/debt reach and be sustained at 30%. The outlook or ratings could be negatively impacted should the company not evidence sequential quarterly improvement such that the debt/EBITDA ratio trends to no more than 4x and EBIT/interest trends toward 2.5x The principal methodology used in these ratings was Global Steel Industry published in October 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Pittsburgh, Pennsylvania, ATI is a diversified producer and distributor of components and specialty metals such as titanium and titanium alloys, nickel-based alloys and stainless and specialty steel alloys. For the twelve months ended September 30, 2014 the company generated revenues of $4.1 billion ALLY FINANCIAL: Files Form 10-Q, Posts $423MM Net Income in Q3 -------------------------------------------------------------- Ally Financial Inc. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q for the period ended Sept. 30, 2014. For the three months ended Sept. 30, 2014, Ally reported net income of $423 million on $2.10 billion of total financing revenue and other interest income compared to net income of $91 million on $2.03 billion of total financing revenue and other interest income for the same period during the prior year. For the nine months ended Sept. 30, 2014, the Company reported net income of $973 million on $6.28 billion of total financing revenue and other interest income compared to net income of $257 million on $6 billion of total financing revenue and other interest income for the same period in 2013. The Company's balance sheet at Sept. 30, 2014, showed $149.19 billion in total assets, $134 billion in total liabilities and $15.19 billion in total equity. A full-text copy of the Form 10-Q is available for free at: http://is.gd/JVWDra About Ally Financial Ally Financial Inc., formerly GMAC Inc. -- http://www.ally.com/-- is one of the world's largest automotive financial services companies. The Company offers a full suite of automotive financing products and services in key markets around the world. Ally's other business units include mortgage operations and commercial finance, and the company's subsidiary, Ally Bank, offers online retail banking products. Ally operates as a bank holding company. GMAC obtained a $17 billion bailout from the U.S. government in exchange for a 56.3 percent stake. Private equity firm Cerberus Capital Management LP keeps 14.9 percent, while General Motors Co. owns 6.7 percent. * * * As reported by the TCR on Dec. 16, 2013, Standard & Poor's Ratings Services said it raised its issuer credit rating on Ally Financial Inc. to 'BB' from 'B+'. "The upgrade reflects the company's release from potential legal and financial liabilities stemming from its ownership of ResCap," said Standard & Poor's credit analyst Tom Connell. In the April 3, 2014, edition of the TCR, Fitch Ratings has upgraded Ally Financial Inc.'s long-term Issuer Default Rating (IDR) and senior unsecured debt rating to 'BB+' from 'BB'. The rating upgrade reflects increased clarity around Ally's ownership structure given Ally's recent announcement that it has launched an initial public offering those shares of its common stock held by the U.S. Treasury (the Treasury). As reported by the TCR on July 16, 2014, Moody's Investors Service affirmed the Ba3 corporate family and B1 senior unsecured ratings of Ally Financial, Inc. and revised the outlook for the ratings to positive from stable. Moody's affirmed Ally's ratings and revised its rating outlook to positive based on the company's progress toward sustained improvements in profitability and repayment of government assistance received during the financial crisis. ALTEGRITY INC: NSA Contractor Seeks to Cut Debt ----------------------------------------------- Matt Jarzemsky, writing for Daily Bankruptcy Review, reported that the company that vetted Edward Snowden is in talks with creditors to cut its roughly $1.7 billion in debt after losing key U.S. government contracts. According to the report, citing people familiar with the matter, Altegrity Inc. is trying to reach a restructuring deal with creditors ahead of a January interest payment that it may not be able to afford. Altegrity provides background investigations for the U.S. government; employment background and mortgage screening for commercial customers; technology-driven legal services and software for data management; and investigative, analytic, consulting, due diligence, and security services. Altegrity is principally owned by investment funds affiliated with Providence Equity Partners. Annual revenues are approximately $1.5 billion. * * * The Troubled Company Reporter, on Sept. 23, 2014, reported that Standard & Poor's Ratings Services lowered its corporate credit rating on Falls Church, Va.-based Altegrity Inc. to 'CCC-' from 'CCC+'. At the same time, S&P lowered its rating on the senior secured asset-backed revolver (ABL) and first-lien debt to 'CCC' from 'B-'. The recovery ratings on the ABL and first-lien debt are '2', indicating that lenders could expect substantial (70% to 90%) recovery in the event of a payment default. On Sept. 16, 2014, the TCR reported that Moody's Investors Service downgraded Altegrity's corporate family rating (CFR) to Caa3, from Caa2, its probability of default rating to Caa3-PD, from Caa2-PD, and changed the outlook for Altegrity's ratings to negative, from stable. ANTELOPE VALLEY: Moody's Affirms Ba2 Bond Rating; Outlook Neg. -------------------------------------------------------------- Moody's Investors Service has affirmed the Ba2 rating assigned to Antelope Valley Healthcare District's bonds. The outlook remains negative. Summary Ratings Rationale Affirmation of the Ba2 rating is based on a review of financial results through September 30, 2014 that exhibit low levels of operating performance and cash flow that remain below budget following a challenging fiscal year (FY) 2014 ended June 30. Liquidity balances have fallen somewhat due to the timing of certain supplemental payments, but Moody's expect liquidity to improve over the course of the year as supplemental payments are received. Strengths * AVHD expects to receive up to $30 million in supplemental funding in FY 2015 (not including meaningful use payments); the organization has received $72 million in supplemental funding over the last three years from a variety of programs including California provider fee and intergovernmental transfer monies. * The hospital has exhibited some stabilization of core operating profitability in recent months, although delays in receipt of certain supplemental money mean that consolidated margins are still weak. * AVHD holds a very strong market position with only one smaller hospital (Lancaster Community, 6,000 admissions) competing in the primary service area, and AVHD provides a number of unique services. Challenges * Supplemental funding receipts are irregular and not always known at the start of the year, making accurate budgeting and forecasting difficult. Absent supplemental funding, the hospital would have negative cash flow; growth of supplemental funding relative to internally generated cash flow is the result of declining core operating performance. * Cost cutting initiatives are taking effect more slowly than originally anticipated. * AVHD's defined benefit pension plan is significantly underfunded and will require much higher cash contributions over the next several years. Cash contributions could rise from the current $8 million to $12 to $13 million. Outlook The negative outlook reflects Moody's view that operating performance remains weak and that there is risk of further margin deterioration if the organization is unable to improve upon recent operating performance levels. What Could Make The Rating Go UP The rating is unlikely to be upgraded over the near term. Longer term an upgrade will be considered if the organization demonstrates consistent and higher levels of profitability and cash flow, and if it can improve its liquidity position, and address an upcoming debt maturity in 2017. What Could Make The Rating Go DOWN The rating could be downgraded if AVHD's operating performance does not improve. Additional factors leading to a downgraded include additional debt, significant delays in the receipt of supplemental funding that stresses liquidity balances and jeopardizes AVHD's ability to meet its liquidity covenant, or an inability to meet the rate covenant. The principal methodology used in this rating was Not-for-Profit Healthcare Rating Methodology published in March 2012. AMERICAN AXLE: Posts $48.6 Million Net Income in Third Quarter -------------------------------------------------------------- American Axle & Manufacturing Holdings, Inc., filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing net income of $48.6 million on $950.8 million of net sales for the three months ended Sept. 30, 2014, compared to net income of $31.6 million on $820.8 million of net sales for the same period in 2013. For the nine months ended Sept. 30, 2014, the Company reported net income of $134.4 million on $2.75 billion of net sales compared to net income of $64.7 million on $2.37 billion of net sales for the same period a year ago. As of Sept. 30, 2014, the Company had $3.22 billion in total assets, $3.05 billion in total liabilities and $169.3 million in total stockholders' equity. "In the third quarter of 2014, AAM's financial results were highlighted by strong cash flow and solid profitability driven by continued sales growth and improvements in operational stability and productivity. Based on our progress through the first three quarters of the year, AAM is on track to deliver more than $100 million of positive free cash flow for the full year 2014," said David C. Dauch, AAM's chairman, president & chief executive officer. "AAM's improved free cash flow execution is helping to reduce our balance sheet leverage and is strengthening our ability to invest in the continued development of innovative new product, process and systems technologies designed to provide our customers with measurable gains in fuel efficiency and power density, as well as improved safety, ride and handling performance." A full-text copy of the Form 10-Q is available for free at: http://is.gd/RmLTAF About American Axle Headquartered in Detroit, Michigan, American Axle & Manufacturing Holdings Inc. (NYSE: AXL) -- http://www.aam.com/-- manufactures, engineers, designs and validates driveline and drivetrain systems and related components and chassis modules for light trucks, sport utility vehicles, passenger cars, crossover vehicles and commercial vehicles. * * * In September 2012, Moody's Investors Service affirmed the 'B1' Corporate Family Rating (CFR) and Probability of Default Rating (PDR) of American Axle. American Axle carries a 'BB-' corporate credit rating from Standard & Poor's Ratings Services. "The 'BB-' corporate credit rating on American Axle reflects the company's 'weak' business risk profile and 'aggressive' financial risk profile, which incorporate substantial exposure to the highly cyclical light- vehicle market," S&P said, as reported by the TCR on Sept. 6, 2012. As reported by the TCR on Sept. 1, 2014, Fitch Ratings had upgraded the Issuer Default Ratings (IDRs) of American Axle & Manufacturing Holdings, Inc. (AXL) and its American Axle & Manufacturing, Inc. (AAM) subsidiary to 'BB-' from 'B+'. The upgrade of the IDRs for AXL and AAM is supported by the fundamental improvement in the drivetrain and driveline supplier's credit profile over the past several years. ANTELOPE VALLEY: Moody's Assigns Ba2 Rating on New $700MM Notes --------------------------------------------------------------- Moody's Investors Service revised Antelope Valley.'s (Omnicare) rating outlook to stable from negative and upgraded its Speculative Grade Liquidity rating to SGL-3 from SGL-4. Moody's also affirmed Omnicare's Ba3 Corporate Family Rating (CFR) and Ba3-PD Probability of Default Rating. At the same time, Moody's assigned a Ba2 rating to the company's proposed $700 million senior unsecured notes while lowering the rating of existing senior unsecured credit facilities to Ba2 from Baa3, and the rating of the senior subordinated notes to B1 from Ba3. Moody's also affirmed the B2 rating on the senior debentures and PIERS trust preferred. Omnicare intends to use the proceeds from the new bond issuance, combined with cash on hand, to repay all $400 million senior subordinated notes due 2020 and refinance a portion of other outstanding debt obligations, including certain convertible indebtedness, and pay fees and expenses. Omnicare also completed an exchange agreement under which it retired approximately $241.5 million aggregate principal amount outstanding of the 3.25% Senior Convertible Debentures due 2035 with a put date of 12/14/15 in exchange for an identical amount of new 3.25% Senior Convertible Exchange Debentures due 2035 and a put date of 1/15/21. The exchange extends the put date by six years on approximately 56% of the outstanding 2035 bonds, diminishing potential liquidity needs. The revision of rating outlook to stable incorporates the company's improved liquidity position as a result of the refinancing transactions and Moody's expectation that the company will prudently manage its potential cash needs on an ongoing basis -- including claims related to in-the-money convertibles and putable instruments -- in order to maintain an adequate liquidity. The stable outlook also reflects Moody's view that the company's operating performance will likely improve modestly over the next year, leading to gradual improvement in credit metrics. The upgraded liquidity rating of SGL-3 reflects Omnicare's improved liquidity position post the proposed refinancing. Moody's expects that following the refinancing, the company will generate sufficient cash flow and maintain adequate cash and revolver availability to fully fund the contingent cash liability that could arise from potential redemption of all of the in-the-money convertible bonds, as well as other cash needs including the holders' put right in December 2015 on the remaining $186 million non-exchanged 2035 convertible bonds. Moody's anticipates cash, projected free cash flow and unused revolver capacity will exceed potential cash needs for convertible and putable instruments by at least $100 million over the next 12-15 months. The Ba2 rating on the new bonds, that are rated at the same level as the senior unsecured bank facilities, reflects the senior unsecured guarantee from certain of the company's existing and future direct and indirect domestic subsidiaries. The notes and guarantees will be general senior unsecured obligations ranking equally in right of payment with the guarantors' existing and future senior unsecured debt, including borrowings under the senior credit facilities. The rating changes on the existing senior credit facilities and subordinated notes mainly reflect the shift in the capital structure mix. The increase in senior unsecured debt and reduction in senior subordinated debt reduces recovery expectations for both classes in a distressed scenario based on Moody's Loss Given Default methodology. Moody's took the following rating actions: Rating upgraded for Omnicare, Inc.: Speculative Grade Liquidity Rating -- upgraded to SGL-3 from SGL-4 Rating assigned to Omnicare, Inc. (subject to Moody's review of final documents): New senior unsecured notes due 2022 at Ba2, LGD2 New senior unsecured notes due 2024 at Ba2, LGD2 Ratings affirmed: (LGD assessment revised) Omnicare, Inc. Corporate Family Rating at Ba3 Probability of Default Rating at Ba3-PD Convertible Senior Debentures at B2,LGD 5 Omnicare Capital Trust II Backed PIERS Trust Preferreds at B2,LGD 6 Omnicare Capital Trust I Backed PIERS Trust Preferreds at B2,LGD 6 Ratings downgraded for Omnicare, Inc.: Senior Unsecured Term Loan A to Ba2, LGD 2 from Baa3,LGD2 Senior Unsecured Revolver to Ba2, LGD 2 from Baa3,LGD2 Senior Subordinated Notes to B1, LGD 4 from Ba3, LGD 4 Convertible Senior Subordinate Notes to B1, LGD 4 from Ba3, LGD 4 Moody's expects to withdraw the Ba3 rating on the senior subordinated notes due 2020 upon closing. Omnicare, Inc.'s rating outlook revised to stable from negative Rating Rationale Omnicare's Ba3 CFR reflects its moderately high financial leverage and risks associated with ongoing reimbursement challenges. Although Omnicare is large relative to other Ba3 rated companies based on revenues and has a leading national position in this niche market, the company still contends with competitive pressures, largely from local market players. Operating challenges, including reduced skilled nursing facility occupancy levels and script volume, are likely to continue. Healthcare reform legislation and reimbursement challenges facing both Omnicare and its customers -- including health plans and nursing homes -- are key risks for the long term care pharmacy sector. Providing some offset, Omnicare's focus on its fast-growing specialty business and recently recovered bed count in the long- term care segment should help improve its top line and profitability. Moody's expects leverage to decline slightly but remain moderately high as free cash flow will likely be allocated toward shareholder activities and acquisitions. Over the outlook period, Moody's does not anticipate any large acquisitions that would require debt financing given that most industry players are much smaller than Omnicare. Ratings could be upgraded if Omnicare demonstrates a conservative approach to growth, sustains improved bed retention rates, grows profitability, and reduces its exposure to government payors. Retained cash flow to debt approaching 20% and debt/EBITDA sustained below 2.5 times could help support an upgrade. Omnicare would also need to maintain a good liquidity position to support an upgrade. The ratings could be downgraded if there are material negative reimbursement changes or if the company engages in large debt financed acquisitions. Retained cash flow to debt that is below the low to mid teens level, or debt/EBITDA sustained above 3.75 times could result in a downgrade. Liquidity deterioration could also lead to a downgrade. Omnicare, Inc., headquartered in Cincinnati, Ohio, is the leading provider of institutional pharmacy services to the long term care sector (LTC), mainly serving skilled nursing facilities (SNFs) and assisted living facilities. The company also has a specialty pharmacy business that provides specialty pharmacy and commercialization services for the biopharmaceutical industry. During the twelve months ended September 30, 2014, Omnicare's revenues approximated $6.3 billion. The principal methodology used in these ratings was the Global Distribution & Supply Chain Services published in November 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. APOLLO MEDICAL: Acquires Majority Stake in Apollo Palliative ------------------------------------------------------------ Apollo Medical Holdings, Inc., announced the launch of a new subsidiary, Apollo Palliative Services, with the acquisition of majority stakes in both a hospice agency and a home health company. The Company appointed Liviu Chindris, M.D., as president of APS. On or around Oct. 27, 2014, Apollo Medical Management, Inc., an affiliate of Apollo Medical Holdings, Inc., made an initial capital contribution of approximately $613,888 to Apollo Palliative in exchange for 51% of the membership interests of APS. APS will serve as a single source for hospice, palliative care and home health services for ApolloMed's health plan, hospital and IPA clients in addition to its own subsidiaries and affiliated medical groups: ApolloMed ACO, Maverick Medical Group, AKM Medical Group, ApolloMed Care Clinics and ApolloMed Hospitalists. The hospice agency serves three counties in Southern California, with an average daily census of 40-60 patients, while the home health agency services three counties in California with an average daily census of 100-140. The hospice division of APS will serve terminally ill patients and their families through the use of an interdisciplinary team. Depending on their needs, each hospice patient and their family is assigned a team comprised of a physician, nurse, home health aide, medical social worker, chaplain, dietary counselor and bereavement coordinator. Hospice and palliative care services are provided in the patient's home, assisted living/nursing home, or in a hospital. The home health division will provide direct home skilled nursing and therapy services, as well as specialty programs such as disease management education, nutrition and help with daily living activities. ApolloMed believes that several factors will contribute to the growth of its hospice and home health business: aging demographics, recognition that in-home services are significantly more cost-effective than institutional care, medical and technological advances that allow more healthcare procedures and monitoring to be provided at home and the benefits of recuperating from an illness or receiving care for a chronic condition in one's own home. "I am very excited to join the management team of ApolloMed as we launch Apollo Palliative Services," stated Dr. Chindris. "We understand the benefits of hospice, palliative care and home health services for patients and their families and our goal is to make APS one of the leading providers in Southern California." "The addition of hospice and home health services will enhance our integrated care model and provide a good platform for the expansion of APS. We believe that as an efficient operator of integrated healthcare delivery, we are favorably positioned to benefit from current industry trends," stated Warren Hosseinion, M.D., chief executive officer of Apollo Medical Holdings. "We are also very pleased to have Dr. Chindris, one of the earliest physicians to join HealthCare Partners, as a member of the ApolloMed team. His wealth of knowledge and experience will be a tremendous asset as we continue to grow ApolloMed's business and expand the services that we provide." Dr. Chindris earned his M.D. from the University of Medicine and Pharmacy in Cluj, Romania and completed an internship and residency in internal medicine at Brooklyn Hospital in Brooklyn, New York and Mercy Hospital in Buffalo, New York. He has held memberships in the American College of Physicians and the American Academy of Hospice and Palliative Medicine. He is fluent in Romanian, French, Italian, Spanish and English. Dr. Chindris was a Senior Partner at HealthCare Partners before it was acquired by DaVita in 2012. Additional information is available for free at: http://is.gd/J17YA7 About Apollo Medical Glendale, Calif.-based Apollo Medical Holdings, Inc., provides hospitalist services in the Greater Los Angeles, California area. Hospitalist medicine is organized around the admission and care of patients in an inpatient facility such as a hospital or skilled nursing facility and is focused on providing, managing and coordinating the care of hospitalized patients. Apollo Medical reported a net loss of $4.55 million for the year ended Jan. 31, 2014, following a net loss of $8.90 million for the year ended Jan. 31, 2013. As of June 30, 2014, the Company had $8.80 million in total assets, $11.79 million in total liabilities and a $2.99 million total stockholders' deficit. ARCAPITA BANK: RA Holding Enters Into Agreement to Sell Lusail -------------------------------------------------------------- RA Holding Corp. on Nov. 5 disclosed that it entered into an agreement pursuant to which the Company's stake in Lusail Golf Development would be sold to a subsidiary of Barwa Real Estate Company Q.S.C. A representative of RA Holding stated: "The Company is pleased to have signed the transaction with Barwa, its existing joint venture partner. The Company expects to receive net proceeds of approximately $365,000,000 (after payment of all fees and senior obligations)." The transaction is expected to complete prior to December 31, 2014. The Company was represented by Milbank, Tweed, Hadley & McCloy LLP and Arab Law Bureau LLP. About RA Holding Corp. RA Holding Corp. is the top-level holding company in the group created pursuant to the plan of reorganization of Arcapita Bank B.S.C.(c) and certain of its affiliates under chapter 11 of the United States Bankruptcy Code. About Arcapita Bank Arcapita Bank B.S.C., also known as First Islamic Investment Bank B.S.C., along with affiliates, filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 12-11076) in Manhattan on March 19, 2012. The Debtors said they do not have the liquidity necessary to repay a US$1.1 billion syndicated unsecured facility when it comes due on March 28, 2012. Falcon Gas Storage Company, Inc., filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 12-11790) on April 30, 2012. Falcon Gas is an indirect wholly owned subsidiary of Arcapita that previously owned the natural gas storage business NorTex Gas Storage Company LLC. In early 2010, Alinda Natural Gas Storage I, L.P. (n/k/a Tide Natural Gas Storage I, L.P.), Alinda Natural Gas Storage II, L.P. (n/k/a Tide Natural Gas Storage II, L.P.) acquired the stock of NorTex from Falcon Gas for $515 million. Arcapita guaranteed certain of Falcon Gas' obligations under the NorTex Purchase Agreement. The Debtors tapped Gibson, Dunn & Crutcher LLP as bankruptcy counsel, Linklaters LLP as corporate counsel, Towers & Hamlins LLP as international counsel on Bahrain matters, Hatim S Zu'bi & Partners as Bahrain counsel, KPMG LLP as accountants, Rothschild Inc. and financial advisor, and GCG Inc. as notice and claims agent. Milbank, Tweed, Hadley & McCloy LLP represented the Official Committee of Unsecured Creditors. Houlihan Lokey Capital, Inc., served as its financial advisor and investment banker. Founded in 1996, Arcapita is a global manager of Shari'ah- compliant alternative investments and operates as an investment bank. Arcapita is not a domestic bank licensed in the United States. Arcapita is headquartered in Bahrain and is regulated under an Islamic wholesale banking license issued by the Central Bank of Bahrain. The Arcapita Group employs 268 people and has offices in Atlanta, London, Hong Kong and Singapore in addition to its Bahrain headquarters. The Arcapita Group's principal activities include investing on its own account and providing investment opportunities to third-party investors in conformity with Islamic Shari'ah rules and principles. The Arcapita Group had roughly US$7 billion in assets under management. On a consolidated basis, the Arcapita Group owns assets valued at roughly US$3.06 billion and has liabilities of roughly US$2.55 billion. The Debtors owe US$96.7 million under two secured facilities made available by Standard Chartered Bank. Arcapita explored out-of-court restructuring scenarios but was unable to achieve 100 percent lender consent required to effectuate the terms of an out-of-court restructuring. Subsequent to the Chapter 11 filing, Arcapita Investment Holdings Limited, a wholly owned Debtor subsidiary of Arcapita in the Cayman Islands, issued a summons seeking ancillary relief from the Grand Court of the Cayman Islands with a view to facilitating the Chapter 11 cases. AIHL sought the appointment of Zolfo Cooper as provisional liquidator. As reported in the TCR on Jun 19, 2013, the Bankruptcy Court for the Southern District of New York entered its Findings of Fact, Conclusions of Law, and Order confirming the Second Amended Joint Chapter 11 Plan of Reorganization of Arcapita Bank B.S.C.(c) and Related Debtors with respect to each Debtor other than Falcon Gas Storage Company, Inc. A copy of the Confirmed Second Amended Joint Plan (With First Technical Modifications) is available at: http://bankrupt.com/misc/arcapita.doc1265.pdf The effective date of the Debtors' Second Amended Joint Plan of Reorganization, dated as of June 11, 2013, occurred on Sept. 17, 2013. BERNARD L. MADOFF: Solus & SPV Not Entitled to Settlement Refund ---------------------------------------------------------------- Bankruptcy Judge Stuart M. Bernstein issued post-trial findings of fact and conclusions of law denying an application for partial refund of prior settlement payments in In re: BERNARD L. MADOFF INVESTMENT SECURITIES LLC, Debtor. IRVING H. PICARD, Trustee for the Liquidation of Bernard L. Madoff Investment Securities LLC, Plaintiff, JPMORGAN CHASE & CO., JPMORGAN, CHASE BANK, N.A., JPMORGAN, SECURITIES LLC, and JPMORGAN, SECURITIES LTD., Defendants, CASE NO. 08-99000 (SMB), ADV. PROC. NO. 08-01789 (SMB)., 10-04932 (SMB), (S.D. N.Y.). At an early stage in this liquidation under the Securities Investor Protection Act (SIPA), Irving H. Picard, SIPA trustee of the estate of Bernard L. Madoff Investment Securities LLC (BLMIS), entered into a settlement agreement with Optimal Strategic U.S. Equity Ltd. (SUS) and Optimal Arbitrage Ltd. (Arbitrage) under which they paid the Trustee the aggregate sum of $233,750,000 (the Optimal Settlement). The settlement represented 85% of the amount of the preference claims asserted against them by the Trustee. The Optimal Settlement included an equal treatment provision, or most favored nations (MFN) clause, which required the Trustee to refund a portion of the settlement payment if he entered into similar future settlements with other defendants for a lower percentage of the claimed amount. SPV Optimal SUS Ltd. (SPV) acquired SUS's rights and Solus Recovery Fund LP -- Applicants -- acquired Arbitrage's rights under the Optimal Settlement. The Trustee subsequently settled avoidance claims he brought against the defendants. JPMorgan paid the estate $325 million, or slightly more than 76% of the amounts sought (the JPMorgan Settlement). Solus and SPV contend that the JPMorgan Settlement triggered the MFN clause, and the Trustee owes each a refund. Finding the Optimal Settlement ambiguous on this point, the Court conducted a trial on July 30, 2014. In his order dated October 10, 2014, a copy of which is available at http://is.gd/zlAirCfrom Leagle.com, Judge Bernstein concluded that the Applicants are not entitled to the refunds they seek. Gary Svirsky, Esq. -- gsvirsky@omm.com -- Emily Chepiga, Esq. -- echepiga@omm.com -- Of Counsel O'MELVENY & MYERS LLP, New York, NY, Attorneys for Solus Recovery Fund L.P. 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 commenced distributions to victims, with the fourth and latest batch of distributions done in May 2014. Distributions to eligible claimants have totaled almost $6 billion, which includes $812.2 million in committed advances from the SIPC. More than 1,100 victims have already recovered the full principal they lost in the fraud. As of May 2014, Mr. Picard has recovered or reached agreements to recover $9.8 billion since his appointment in December 2008. BROADWAY FINANCIAL: Director Renata Simril Quits ------------------------------------------------ Ms. Renata Simril tendered her resignation, effective Oct. 31, 2014, from the Boards of Directors and the Loan Committee of Broadway Financial Corporation, parent company of Broadway Federal Bank, and the Bank. According to a regulatory filing with the U.S. Securities and Exchange Commission, Ms. Simril accepted another position at the Los Angeles Times and her resignation was not the result of any disagreement with the Company on any matter relating to the Company's operations, policies or practices. About Broadway Financial Los Angeles, Calif.-based Broadway Financial Corporation was incorporated under Delaware law in 1995 for the purpose of acquiring and holding all of the outstanding capital stock of Broadway Federal Savings and Loan Association as part of the Bank's conversion from a federally chartered mutual savings association to a federally chartered stock savings bank. In connection with the conversion, the Bank's name was changed to Broadway Federal Bank, f.s.b. The conversion was completed, and the Bank became a wholly owned subsidiary of the Company, in January 1996. The Company is regulated by the Board of Governors of the Federal Reserve System. The Bank is regulated by the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation. Broadway Financial reported a loss allocable to common stockholders of $1.08 million in 2013, a loss allocable to common stockholders of $693,000 in 2012 and a net loss available to common shareholders of $15.36 million in 2011. The Company's balance sheet at March 31, 2014, the Company had $335.07 million in total assets, $308.51 million in total liabilities and $26.56 million in total stockholders' equity. CANYON COMPANIES: Moody's Affirms B2 Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service affirmed Canyon Companies, S.A.R.L.'s (dba Cision) corporate family rating of B2 and revised the company's ratings outlook to negative from stable. The ratings of the first and second lien debt (held at subsidiary GTCR Valor Companies, Inc.) were also affirmed, as listed below. Ratings Rationale The outlook change to negative was driven by the announcement of Cision's largely debt-financed acquisition of Gorkana. The acquisition was funded using incremental first and second lien debt of $170 million and $65 million, respectively, as well as additional sponsor equity and a modest amount of balance sheet cash. Though the acquisition provides Cision with a strong complementary product offering in the United Kingdom and enhanced scale, the management team faces significant challenges with respect to the restructuring and integration of the company's operations and software platforms. The companies have overlap in products and management expects to realize synergies fairly quickly. The negative outlook recognizes that this acquisition is modestly leveraging and reduces the pace at which Moody's expect the company to de-lever, while introducing additional integration challenges as the company is transformed. As a result of this transaction, debt increased from approximately 63% to 70% of the capital structure. Given the divestitures and recent acquisitions, historical audits are of limited use in assessing the new entity. The B2 rating continues to reflect Cision's high debt load at a time when the company is in the midst of integration challenges in Cision & Vocus and now, Gorkana. Debt/EBITDA exceeds 6x based on pro forma August 31, 2014 LTM results, and well over 7x excluding synergies. The combined company has a leadership position in various segments of the public relations software industry, and the combination enhances scale and geographic diversity. However, the company is considered weakly positioned in the B2 category due to the high leverage and significant near term integration and restructuring challenges. Ratings could be downgraded if the integration falters or leverage is not on track to get to 5.5x or free cash flow to debt is not on track to get to 7% or greater. Though unlikely in the near term given the integration challenges, the ratings could be upgraded if leverage is sustained below 4x. Liquidity is good, with approximately $24 million of cash at the close of the Gorkana acquisition, and improves with the expectation of over $30 million of free cash flow over the course of FY2015. Liquidity is also supported by an undrawn $25 million revolver, which is subject to certain limitations and financial covenants. The following ratings were affirmed: Affirmations: Issuer: Canyon Companies S.A.R.L. Probability of Default Rating, Affirmed B2-PD Corporate Family Rating, Affirmed B2 Issuer: GTCR Valor Companies, Inc. Senior Secured Revolving Credit Facility May 30, 2019, Affirmed B1 (LGD3) Senior Secured Bank Credit Facility May 30, 2021, Affirmed B1 (LGD3) Senior Secured Bank Credit Facility May 30, 2021, Affirmed B1 (LGD3) Senior Secured Bank Credit Facility Nov 30, 2021, Affirmed Caa1 (LGD5) Senior Secured Bank Credit Facility Nov 30, 2021, Affirmed Caa1 (LGD5) Outlook Actions: Issuer: Canyon Companies S.A.R.L. Outlook, Changed To Negative From Stable Issuer: GTCR Valor Companies, Inc. Outlook, Changed To Negative From Stable The principal methodology used in these ratings was Global Software Industry published in October 2012. Other methodologies used include Loss Given Default for Speculative-Grade Non- Financial Companies in the U.S., Canada and EMEA published in June 2009. Canyon Companies S.A.R.L. (dba Cision), owned by private equity firm GTCR is a provider of software platforms for public relations professionals. The company is a combination of certain key assets of Cision AB, Vocus, Inc., and Gorkana Group. CARECORE NATIONAL: Moody's Affirms B2 Corporate Family Rating ------------------------------------------------------------- Moody's Investors Service affirmed the B2 Corporate Family Rating and B2-PD Probability of Default Rating of CareCore National, LLC. Moody's also affirmed the company's upsized senior secured first lien credit facilities, including its revolving credit facility (being upsized to $110 million from $75 million) and its senior secured first lien term loan (being upsized to $850 million from $315 million). The proceeds from the add-on term loan will be used to finance the acquisition of MedSolutions, Holdings, Inc. and pay associated transaction fees and expenses. The rating outlook is stable. In connection with the acquisition, MedSolutions' shareholders will take equity in CareCore and have a minority ownership with CareCore shareholders retaining majority ownership. The transaction is subject to customary regulatory approvals and is expected to close during the fourth quarter of 2014. Following is a summary of Moody's rating actions: CareCore National, LLC: Ratings affirmed: B2 Corporate Family Rating B2-PD Probability of Default Rating Senior secured first lien revolving credit facility (being upsized to $110 million from $75 million), B2 (LGD 3) Senior secured first lien term loan (being upsized to $850 million from $315 million), B2 (LGD 3) The rating outlook is stable. Ratings Rationale CareCore's B2 Corporate Family Rating reflects the company's high revenue concentration among its top customers and therapeutic program segments, its high financial leverage, and uncertainty related to potential undisclosed liabilities which present near- term risk. The rating also reflects the company's aggressive acquisition strategy, and the substantial integration and execution risks inherent in the consummation of the acquisition of MedSolutions, the largest acquisition in the company's history. The rating is supported by the combined company's leading market position, longstanding customer relationships, lack of direct Medicare or Medicaid reimbursement risk, and favorable fundamentals and macro trends within the market for specialty benefit management services. On a pro forma basis for the acquisition, Moody's estimate adjusted debt to EBITDA would have been approximately 4.6 times for the twelve months ended September 30, 2014, including 50% of management's targeted cost synergies. The stable outlook reflects Moody's expectation that the company will reduce financial leverage due to earnings growth and cost synergy opportunities following the acquisition of MedSolutions, offset by integration and execution risks inherent in consummating the largest acquisition in the company's history. The stable outlook also incorporates Moody's expectation that the company will not face any adverse outcome with respect to certain undisclosed potential liabilities, and that the company will not engage in debt-financed shareholder initiatives. The ratings could be downgraded if there is a material contraction in the level of operating cash flow, or if the company fails to maintain sufficient available liquidity sources, including unrestricted cash and revolver availability. In addition, the ratings could be downgraded if any adverse event requires incremental debt, such that adjusted total debt to EBITDA exceeds 5.0 times on a Moody's adjusted basis. While not expected over the near-term due to the company's high customer and program concentration, the ratings could be upgraded over time if the company significantly reduces the reliance on revenue from its top customers via new contact wins and adjusted debt to EBITDA is sustained below 3.5 times on a Moody's adjusted basis. The principal methodology used in these ratings was Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Bluffton, South Carolina, CareCore National, LLC is a specialty benefits management company that provides healthcare management and administrative services on behalf of clients consisting primarily of commercial health insurers and other third-party payors including Managed Medicaid and Medicare Advantage plans. For the twelve months ended September 30, 2014, the company generated total revenues of approximately $622 million. CAROLINE WYLY: Seeks Ch. 11 Protection in Face of $101M SEC Debt ---------------------------------------------------------------- Law360 reported that Caroline D. Wyly, widow of Charles Wyly Jr., filed for bankruptcy protection, in the wake of a judgment worth hundreds of millions of dollars against the estate of the late Texas tycoon and his brother, Samuel Wyly, for allegedly using secretive offshore trusts to trade stocks while evading taxes. According to the report, Ms. Wyly listed both assets and liabilities of between $100 million and $500 million and listed the U.S. Securities and Exchange Commission as her largest creditor, with a $101.2 million claim. The petition comes days after Sam Wyly sought Chapter 11 protection, saying he can't afford a potential $198 million government penalty for allegedly using secretive offshore trusts to trade stocks while evading taxes, the report noted. The case is In Re: Caroline D. Wyly, case number 14-35074, in the U.S. Bankruptcy Court for the Northern District of Texas. CHANNEL CONSTRUCTION: Alaska Judge Defers Ruling on McGee Fees -------------------------------------------------------------- Bankruptcy Judge Hobb Ross in Alaska deferred approval of (i) the fees sought by McGee Law Offices for its services rendered in the Chapter 11 case of Channel Construction Inc., and (ii) the modifications to the terms of MLO's retention. Judge Ross directed the firm to make some clarification. "My sole concern is that the proposed Legal Representation Agreement can be fairly read to mean that if the court approves the retention agreement -- i.e., granting a hybrid of reduced hourly rates and a contingency fee -- the new reduced hourly rate would kick in for fees incurred after July 18, 2014. On the other hand, it might have been the intent of the parties that only fees subsequent to court approval are at the reduced rate. It is ambiguous to the court," Judge Ross said. The motion for approval of the modification agreement was not filed until October 2, 2014, almost two-and-a-half months after it was executed. So, the court needs clarification that the debtor and MLO are on the same page as to the starting date for the reduced fees. If the intention was for fees incurred after July 18, 2014 to be charged at the reduced rate, subject to the court approving the hybrid billing scheme, the billing statements would have to be redone to reflect that. Terrence K. McGee of MLO serves as special counsel to the Debtor. Judge Ross noted, "In general, I have no quarrel with the math and detail shown by MLO's five billing statements which are exhibits to the fee application. . . I want to point out to MLO, however, that it improperly collected $15,000 from the debtor in August, prior to approval of its fees and expenses. This should not happen again. The order authorizing MLO's retention specifically states that all payments are subject to prior court order." "Also, MLO started working post-petition on April 1, 2014, but did not get approval for employment until May 23, 2014, nunc pro tunc. No explanation for the delay in seeking approval of its retention has been offered as required by Ninth Circuit precedent. Again, I will assume that this was due to inexperience in bankruptcy protocol and not press the point. No one else has raised the issue." A copy of Judge Ross' Nov. 3 Memorandum is available at http://bit.ly/1x5Qhcbfrom Leagle.com. Channel Construction, Inc., based in Juneau, Alaska, filed for Chapter 11 bankruptcy (Bankr. D. Alaska Case No. 14-00103) on March 31, 2014. Judge Herbert A. Ross oversees the case. Cabot C. Christianson, Esq., at Christianson & Spraker, serves as the Debtor's counsel. The Debtor estimated $1 million to $10 million in both assets and liabilities in its petition. A list of the Debtor's 29 largest unsecured creditors is available for free at http://bankrupt.com/misc/akb14-103.pdf COMMUNITYONE BANCORP: Posts $1.8-Mil. Net Income in 3rd Quarter --------------------------------------------------------------- CommunityOne Bancorp reported net income of $1.77 million on $18.39 million of total interest income for the three months ended Sept. 30, 2014, compared to net income of $4 million on $19.85 million of total interest income for the same period in 2013. The Company's balance sheet at Sept. 30, 2014, showed $2.01 billion in total assets, $1.92 billion in total liabilities and $94.49 million in total shareholders' equity. "During the quarter, we continued our momentum by growing loans and deposits, achieving our end of year 2014 goal of a 75% loans to deposits ratio," noted Bob Reid, president and CEO. "Our credit quality also continues to track ahead of plan and we expect that to continue. Despite a significant charge related to the departure of our CEO, I am pleased we made significant progress on our key goals and delivered our fifth consecutive quarter of profitability. We continue to focus on reducing noninterest expense as well as our nonperforming assets, even as we make investments in new personnel, new markets and new products to drive growth." A copy of the press release is available for free at: http://goo.gl/oCCThg About CommunityOne CommunityOne Bancorp (formerly FNB United) is the North Carolina- based bank holding company for CommunityOne Bank, N.A. (community1.com), which offers a full range of consumer, mortgage and business banking services, including loan, deposit, cash management, wealth and online banking services through 55 branches in 44 communities throughout the central, southern and western regions of the state. CommunityOne Bancorp incurred a net loss of $1.48 million in 2013, a net loss of $40 million in 2012, and a $137.31 million net loss in 2011. CONEX INTERNATIONAL: Trustee Fails in Tax Suit vs. Parent Company ----------------------------------------------------------------- Law360 reported that U.S. Bankruptcy Judge Christopher Sontchi in Wilmington, Delaware, dismissed a complaint brought by Charles A. Stanziale, Jr., the Chapter 7 trustee for bankrupt oil services contractor Conex International LLC, seeking to recover $2.6 million from its parent CopperCom Inc. over its allegedly improper use of Conex's net operating losses for its own tax benefit. According to the report, Judge Sontchi said the trustee does not have an undisputed right to recover the net operating losses because Conex is a disregarded entity of CopperCom and, under the Internal Revenue Code, any of its tax benefits and liabilities are held by the parent. Judge Sontchi also dismissed four other counts without prejudice, including breach of implied covenant of good faith, unjust enrichment and two counts of avoidance of transfers, and gave the trustee 28 days to amend his complaint. The adversary case is Stanziale v. CopperCom Inc., case number 13- 50939, in the same venue. 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). CT TECHNOLOGIES: Moody's Assigns B2 Corporate Family Rating ----------------------------------------------------------- Moody's Investors Service has assigned to CT Technologies Intermediate Holdings, Inc. (dba "HealthPort"), a B2 corporate family rating ("CFR"), a B2-PD probability of default rating ("PDR"), and B2 ratings to the proposed first lien revolving credit facility due 2019 and first lien term loan due 2021. The ratings outlook is stable. On October 17, 2014, New Mountain Capital, LLC entered into a definitive agreement to acquire HealthPort. Proceeds from the new term loan, along with sponsor equity, will be used to purchase HealthPort, repay existing debt and pay related fees and expenses. Ratings on existing debt will be withdrawn upon closing of the transaction. The following rating actions were taken: Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Proposed $30 million first lien revolver due 2019, Assigned B2 (LGD3) Proposed $325 million first lien term loan due 2021, Assigned B2 (LGD3) Outlook, at Stable Rating Rationale The B2 CFR reflects HealthPort's relatively small revenue size of $300 million and expectations for debt to EBITDA to fall below 5 times and free cash flow to debt to rise above 7% of over the next 12 months. The ratings are constrained by reputational and legal risks attendant in the release of protected health information, although HealthPort has never been charged with a breach. Over the medium term, Moody's expects solid growth in medical information exchange end market demand. HealthPort should continue to benefit from its leading position in the market for third party exchange providers. Volumes are expected to grow as an aging population and healthcare reform drive the generation of more medical records. Commercial payers are expected to be a driver of revenue growth. No recovery in volumes associated with the Centers for Medicare and Medicaid Services (CMS) Recovery Audit Contractor (RAC) program is anticipated in Moody's expectations for HealthPort's growth. Moody's expects HealthPort to maintain a good liquidity profile, supported by annual free cash flow of about $25 million and $25 million of availability under the $30 million revolver. All financial metrics reflect Moody's standard adjustments. The stable outlook reflects Moody's anticipation that HealthPort will continue to grow its market share while maintaining stable profitability margins and at least adequate liquidity. The ratings could be downgraded if pricing pressures or negative regulatory developments result in margin compression and declines in cash generation such that free cash flow to debt falls below 2% or debt to EBITDA is sustained above 6 times. A debt-funded acquisition or dividend could also pressure the rating. The ratings could be upgraded if HealthPort expands its business scope and revenue base, maintains stable profit margins and reduces debt such that debt to EBITDA is sustained below 4.5 times. HealthPort is the largest provider of medical information exchange management services in the United States. Moody's expects revenue to exceed $320 million in 2015. The principal methodology used in this rating was Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. CTI BIOPHARMA: Seeking Add'l Capital, May File for Bankruptcy ------------------------------------------------------------- CTI Biopharma Corp. filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q for the period ended Sept. 30, 2014. The Company disclosed that its available cash and cash equivalents were $29.9 million as of Sept. 30, 2014. Subsequent to period end, the Company borrowed $5 million in additional outstanding principal under its senior secured term loan agreement, and the Company received an upfront payment of EUR14 million (or $17.8 million using the currency exchange rate as of the date the Company received the funds in October 2014) in connection with the Company's exclusive license and collaboration agreement with Servier. "We believe that our present financial resources (including the $17.8 million we received in October 2014 under the Servier Agreement), together with additional milestone payments projected to be received under certain of our contractual agreements, our ability to control costs and expected net contribution from commercial operations in connection with PIXUVRI, will only be sufficient to fund our operations into the third quarter of 2015. This raises substantial doubt about our ability to continue as a going concern," the Company disclosed in the filing. The Company added it will need to raise additional funds and is currently exploring alternative sources of financing. "We may seek to raise such capital through public or private equity financings, partnerships, joint ventures, disposition of assets, debt financings or restructurings, bank borrowings or other sources of financing. However, we have a limited number of authorized shares of common stock available for issuance and additional funding may not be available on favorable terms or at all. If additional funds are raised by issuing equity securities, substantial dilution to existing shareholders may result. If we fail to obtain additional capital when needed, we may be required to delay, scale back or eliminate some or all of our research and development programs, reduce our selling, general and administrative expenses, be unable to attract and retain highly qualified personnel, refrain from making our contractually required payments when due (including debt payments) and/or may be forced to cease operations, liquidate our assets and possibly seek bankruptcy protection." For the three months ended Sept. 30, 2014, the Company reported net income attributable to the Company's common shareholders of $4.60 million on $39.53 million of total revenues compared to a net loss attributable to common shareholders of $22.44 million on $362,000 of total revenues for the same period in 2013. The Company also reported a net loss attributable to the Company's common shareholders of $51.79 million on $42.28 million of total revenues for the nine months ended Sept. 30, 2014, compared to a net loss attributable to the Company's common shareholders of $59.83 million on $1.79 million of total revenues for the same period a year ago. The Company's balance sheet at Sept. 30, 2014, showed $68.59 million in total assets, $44.65 million in total liabilities, $7.89 million in common stock purchase warrants, and $16.04 million in total shareholders' equity. A copy of the Form 10-Q Report is available for free at: http://is.gd/kyV9wS About CTI BioPharma CTI BioPharma Corp. (NASDAQ and MTA: CTIC) -- http://www.ctibiopharma.com/-- formerly known as Cell Therapeutics, Inc., is a biopharmaceutical company focused on the acquisition, development and commercialization of novel targeted therapies covering a spectrum of blood-related cancers that offer a unique benefit to patients and healthcare providers. The Company has a commercial presence in Europe and a late-stage development pipeline, including pacritinib, CTI's lead product candidate that is currently being studied in a Phase 3 program for the treatment of patients with myelofibrosis. CTI BioPharma is headquartered in Seattle, Washington, with offices in London and Milan under the name CTI Life Sciences Limited. Cell Therapeutics reported a net loss attributable to common shareholders of $49.64 million in 2013, a net loss attributable to common shareholders of $115.27 million in 2012 and a net loss attributable to common shareholders of $121.07 million in 2011. DETROIT, MI: Seeks Court Order Confirming Inapplicability of Stay ----------------------------------------------------------------- Detroit has filed a motion seeking court confirmation that the so- called automatic stay does not apply to cases it filed against city officers and employees who are subject to disciplinary action. The move comes after an arbitrator presiding over a case involving a public safety officer put it on hold until U.S. Bankruptcy Judge Steven Rhodes confirms that the city can continue to prosecute the case notwithstanding its Chapter 9 case. "The automatic stay does not apply to the disciplinary proceedings because they are offensive actions commenced by the city as plaintiff against city officers and employees that are subject to disciplinary action," said Detroit lawyer, Heather Lennox, Esq., at Jones Day in Cleveland, Ohio. 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 estimated 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. * * * Standard & Poor's Ratings Services, on Sept. 5, 2014, raised its ratings on five bond CUSIPs of Detroit's outstanding sewerage disposal and water supply revenue bonds to 'BBB+' from 'D' as S&P indicated it would do in its report dated Aug. 28, 2014. The outlook is stable. The Troubled Company Reporter, on Oct. 10, 2014, reported that Moody's Investors Service has placed the City of Detroit's (MI) Certificates of Participation (COPs) Ca rating on review for possible downgrade. This action follows the recent settlement announcement between the city and Syncora, which insures a portion of the city's outstanding COPs. The settlement includes a cash payment, as well as extended and optional stakes in city owned assets. Moody's said it is likely that the recovery for creditors will be below 35% and as a result consistent with a C rating. The review will be resolved if and when a settlement with FGIC, the other main insurer of the city's COPs liabilities, is made public. DIGITAL DOMAIN: To Return $18MM in Tax Credits to Florida --------------------------------------------------------- Adolfo Pesquera at the Daily Business Review reports that the Hon. Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware has ordered Digital Domain Media Group Inc. to release $18 million in film project tax credits to the state of Florida. According to Business Review, the Florida Department of Economic Opportunity, which is represented by Sean T. Cork of Squire Patton Boggs in Miami, argued for the release of the credits. A written order is pending, Business Review says, citing William Scherer of Conrad & Scherer in Fort Lauderdale, who represents Florida in another Digital Domain-related case. Mr. Sherer said that the decision on the $18 million recovery is "a good thing for the state and the taxpayers because I won't have to litigate it and it's not subject to my contingency fee," the report states. Business Review relates that another $2 million in tax credits for one of the Company's productions is still in dispute. According to a joint status report presented to the Court on Oct. 24, the committee of unsecured creditors objected to releasing the $2 million to the state of Florida. 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. DISH DBS: Fitch Assigns 'BB-' Rating on $1.25-Bil. Sr. Notes ------------------------------------------------------------ Fitch Ratings has assigned a 'BB-' rating to DISH DBS Corporation's (DDBS) issuance of approximately $1.25 billion of senior unsecured notes. Proceeds from the offering are expected to be used for general corporate purposes, including the refinancing of debt. DDBS is a wholly owned subsidiary of DISH Network Corporation. Both DISH Network Corporation (DISH) and DDBS have a 'BB-' Issuer Default Rating (IDR). The Rating Outlook for all of DISH's ratings remains Negative. DISH had approximately $13.4 billion of debt outstanding as of Sept. 30, 2014. KEY RATING DRIVERS Wireless Strategy Uncertainty: Drivers of the Negative Outlook include the lack of visibility into DISH's wireless strategy, and the potential capital requirements and execution risk associated with that strategy. In Fitch's view, DISH would need to meaningfully differentiate its wireless services in order for the strategy to successfully diversify its revenues, and to provide for potential cash flow growth. An offering similar to other wireless operators' services would likely struggle to gain traction, given the maturing wireless market and entrenched national operators. Elevated Leverage Threatens Ratings: Leverage rose in 2013, and has remained higher, as DISH has built cash to fund the wireless strategy. Fitch believes the higher debt levels, along with elevated execution and integration risks associated with DISH's wireless strategy limit the company's financial flexibility at the current ratings level. The company will need to make significant investments or partner with other operators to realize its strategy. Cash Balance Swells: Total debt outstanding as of Sept. 30, 2014 was approximately $13.4 billion, with cash, cash equivalents and current marketable securities approximating $9.3 billion. DISH's leverage increased to approximately 4.7x for the last 12 months (LTM) ending Sept. 30, 2014, down slightly from 4.8x at the end of 2013 (but still well over the 4.0x in 2012). The high leverage limits the company's financial flexibility within the current rating category. The cash proceeds from the company's incremental debt issuances have largely remained on its balance sheet, and will, in part, support DISH's wireless strategy. EBITDA: Higher programming and broadband subscriber acquisition costs have had an effect on the company's operating margins and EBITDA generation. These factors contributed to a 0.2% decline in EBITDA in for the LTM ending Sept. 30, 2014 relative to the full year 2013. Ratings Reflect Weak Trends: Fitch believes the company's overall credit profile has limited capacity to accommodate DISH's inconsistent operating performance as the company struggles to transform its branding strategy from a value-oriented service provider to a technology-focused provider targeting high-value subscribers. While subscriber metrics remain weak, average revenue per user (ARPU) has benefited from programming cost increases, higher hardware-related revenue and increased advertising revenue. ARPU increased 4.4% for the first nine months of 2014 versus the prior period. DISH's efforts to transform though various wireless initiatives remain in a development stage. The company's strategy has experienced numerous set-backs as the company endeavors to engage another wireless carrier seeking a partnership, acquisition or network-sharing agreement. Event risks remain elevated as the company contemplates additional acquisitions of spectrum or assets to support the wireless strategy. The strategic importance of a wireless broadband service option has not diminished and, as such, Fitch expects DISH will likely continue its efforts to engage an existing national wireless service provider. DISH will participate in the upcoming AWS-3 spectrum auction, which is an opportunity for the company to add to its current spectrum position. In Fitch's opinion, DISH may have the most interest in the unpaired, uplink only 1695-1710 MHz blocks given it can elect to convert the uplink portion of its AWS-4 spectrum into a downlink spectrum block. As indicated by the FCC's low reserve price on this spectrum--$0.12 per MHz POP, this spectrum is not expected to generate significant interest. The company is in a unique position with regard to its participation in the auction, if valuations in the AWS-3 auction are low, it will provide DISH with an opportunity to acquire additional spectrum inexpensively. Conversely, if valuations in the auction are high, DISH may acquire less spectrum, but high valuations have the potential to increase the valuation of its existing, undeployed AWS-4 spectrum. High valuations placed on its AWS-4 spectrum can be advantageous to DISH as it explores opportunities to partner with other carriers in the deployment of its yet-to-be-defined wireless strategy. DISH believes its AWS-4 spectrum is potentially of higher value than the AWS-3 spectrum, given its option to convert all of the AWS-4 spectrum to downlink spectrum. This downlink waiver was granted by the FCC in December 2013, and the option is in effect through June 20, 2016. Fitch regards the company's liquidity position as strong and primarily supported by sizable cash and marketable securities balances and expected, but diminishing free cash flow (FCF) generation. The company also benefits from a favorable maturity schedule, as 32% of the company's outstanding debt is scheduled to mature through 2018, excluding $900 million repaid on Oct. 1, 2014. In 2015, $650 million matures. DISH had a total of approximately $9.3 billion of cash and marketable securities (current portion). DISH DBS holds approximately $4.5 billion of the consolidated $4.8 billion cash balance and more than $3.7 billion of consolidated $4.5 billion marketable securities balance. The high cash balances mitigate the risk caused by the lack of a revolving credit facility. DISH's FCF (defined as cash flow from continuing operations less capital expenditures and dividends) generation rose approximately 15% during the first nine months of 2014 to $869 million when compared to the same period during 2013. DISH's capital intensity has remained relatively stable in the 8% to 9% range in 2014. Capital expenditures will continue to focus on subscriber retention and capitalized subscriber premises equipment. The higher leverage and weaker operating profile will continue to constrain FCF generation over the ratings horizon. Additional rating concerns center on DISH's ability to adapt to the evolving competitive landscape, DISH's lack of revenue diversity and narrow product offering relative to its cable MSO and telephone company video competition, and an operating profile and competitive position that continue to lag behind its peer group. DISH's current operating profile is focused on its maturing video service offering and lacks growth opportunities relative to its competition. RATING SENSITIVITIES Revision of the Outlook to Stable at the current rating level can occur as the company demonstrates that it can execute its wireless strategy in a credit-neutral manner. In addition, operating metrics, in particular subscriber additions, ARPU growth and EBITDA margins will need to begin to trend positive. Fitch believes negative rating action will likely coincide with the company's decision to execute a wireless strategy, or other discretionary management decisions that weaken its ability to generate FCF, erode operating margins, and increase leverage higher than 5x without a clear strategy to de-lever the company's balance sheet. DISH DBS: Moody's Assigns Ba3 Rating on New $1.25BB Unsec. Notes ---------------------------------------------------------------- Moody's Investors Service assigned a Ba3 (LGD4-67%) rating to DISH Network Corporation's (DISH) proposed $1.25 billion senior unsecured notes maturing in 2024. The new notes will be issued at the company's wholly-owned subsidiary, DISH DBS Corporation (DISH DBS), and will be pari pasu with DISH DBS's existing senior unsecured notes, which are guaranteed only by the US pay-TV operating company subsidiaries. The company plans to utilize the net proceeds from the offering for general corporate purposes, including replenishing cash used for repayment of $900 million 6.625% Senior Notes, which matured in October 2014. Proceeds from the debt offering may also be used to prefund repayment of the company's $650 million 7.75% Senior Notes due in 2015. Moody's believe DISH is taking advantage of the low interest rate environment to lock-in long-term financing at attractive terms and bolster its liquidity position. The transaction is largely neutral from a ratings perspective given that debt-to-EBITDA leverage will not change, but over the long-term, savings from lower interest expense should positively impact the company's operating cash flows. As of 09/30/2014, DISH DBS's leverage was roughly 4.7x (incorporating Moody's standard adjustments) and the company had over $8 billion of cash and marketable securities on its balance sheet. The rating outlook for DISH DBS is negative. Assignments: Issuer: Dish DBS Corporation US$1.25 Billion Senior Unsecured Bond, Assigned Ba3, LGD4 Ratings Rationale DISH's Ba3 Corporate Family Rating ("CFR") reflects high gross debt-to-EBITDA leverage of 4.7x as of 09/30/2014 (incorporating Moody's standard adjustments), resulting from an increase in the company's debt level, which has more than doubled in the last three years. Notably, leverage is slightly higher at the parent company (DISH) and DISH DBS is its primary source of cash flows to service expenses and investments. The rating continues to reflect Moody's concern that competition from cable and telecommunication companies, who offer multiple products (video, voice, and data), will pressure margins and cash flow generation as the costs to grow and retain subscribers will continue to escalate. The company's parent has been beefing up its wireless spectrum base aiming to strengthen its wireless broadband potential capacity in order to enter the wireless space and withstand market saturation or possibly benefit from an increase in value. Earlier this year, DISH made a significant investment to purchase certain H Block wireless spectrum licenses, bringing the total spectrum holding to 56 megahertz. Moody's expect the company will participate in FCC's upcoming auction and the incentive auction planned for 2015. Event risks and uncertainty stemming from what direction the company's wireless strategy will take are only partially tempered by the potential to improve DISH's DBS business profile, and Moody's remain concerned over the legal credit structure supporting DISH DBS bonds, which possess only minimal protections against leverage and up-streaming cash to its parent, DISH. Further, the company's creditors have no recourse to assets held outside of DISH DBS, including the company's wireless spectrum. Accordingly, uncertainty surrounding strategic plans and future impact on its balance sheet continue to weigh on DISH's credit ratings as it pursues a potentially transformative entry into the wireless market. The ratings continue to be supported by DISH's sizeable subscriber base and continued rollout of technologically advanced products that have been embraced by consumers, such as the Hopper and Joey set top boxes. The rating also considers the company's controlling shareholder structure. The controlling shareholder and Chairman, Charles Ergen, has until recently, maintained a conservative balance sheet, but has demonstrated the willingness to be highly acquisitive. In addition, lack of transparency on fiscal policies and financial guidance from the company's management, and flexible indenture covenants also moderately constrain the CFR. Rating Outlook The negative rating outlook reflects the potential for a transformative transaction by DISH in its pursuit of a nationwide wireless broadband strategy, which may lead to higher leverage at DISH DBS and significant ongoing investments that would drain cash from DISH DBS without providing creditors with recourse to any new assets or investments. Within its core video business, Moody's expect DISH to maintain a sizeable subscriber base and solid liquidity. What Could Change the Rating -- DOWN DISH may be downgraded if it engages in acquisitions and investments such that leverage is sustained over 5.5x. However, DISH could also be downgraded if leverage is sustained over 4.5x and Moody's expect it to up-stream its cash to fund a high risk business that doesn't generate free cash flow and to which DISH's creditors have no recourse. In addition, material subscriber losses, multiple satellite failures that cannot be mitigated with backup transponders or capacity constraints that affect the company's ability to provide a competitive service could also have negative rating implications. What Could Change the Rating -- UP Upward rating movement is unlikely, given the negative outlook. If DISH's leverage is sustained below 4.0x, the company's ratings could be upgraded though Moody's would need to understand the company's next strategic steps with regard to its wireless strategy, how it plans to use its cash balance, and if its creditors have recourse to its current and future wireless assets. DISH DBS Corporation is a wholly owned subsidiary of DISH Network Corporation and is a direct broadcast satellite pay-TV provider, with the third largest U.S. video subscriber base of about 14.04 million subscribers as of 09/30/14. Revenue for the LTM period ending 09/30/14 was around $14 billion. The principal methodology used in this rating was Global Pay Television -- Cable and Direct-to-Home Satellite Operators published in April 2013. DISH DBS: S&P Assigns 'BB-' Rating on $1.25BB Sr. Unsecured Notes ----------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' issue-level rating and '4' recovery rating to DISH DBS Corp.'s proposed $1.25 billion of senior unsecured notes due 2024. The '4' recovery rating indicates S&P's expectation for average (30% to 50%) recovery for noteholders in the event of a payment default. Recovery is at the high end of this range. DISH DBS Corp. is the main subsidiary of Englewood, Colo.-based satellite TV provider DISH Network Corp. (DISH). S&P expects the company to use net proceeds from the notes to replenish liquidity, prefund the repayment of existing indebtedness, and potentially for the acquisition of spectrum licenses. The 'BB-' corporate credit rating and negative rating outlook remain unchanged. S&P's rating on DISH primarily reflects its core video and satellite broadband business, as S&P don't currently fully incorporate the potential benefits of its spectrum assets within its business risk profile assessment. Additionally, from a recovery standpoint, the spectrum sits outside the restricted group on the company's bonds, and therefore does not provide additional value in S&P's recovery analysis. While dependent on DISH's ultimate wireless strategy and whether it keeps its direct-broadcast-satellite and spectrum assets together, bondholders could benefit over a longer term assuming an improvement in the company's business prospects, which could include mobile video and fixed broadband initiatives. RATINGS LIST DISH DBS Corp. Corporate Credit Rating BB-/Negative/-- New Rating DISH DBS Corp. $1.25 Bil. Senior Unsec. Notes Due 2024 BB- Recovery Rating 4 DOVER DOWNS: Posts $699,000 Net Earnings in Third Quarter --------------------------------------------------------- Dover Downs Gaming & Entertainment, Inc., reported net earnings of $699,000 on $47.98 million of revenues for the three months ended Sept. 30, 2014, compared to net earnings of $223,000 on $50.07 million of revenues for the same period in 2013. For the nine months ended Sept. 30, 2014, the Company reported a net loss of $190,000 on $139.67 million of revenues compared to net earnings of $431,000 on $150.63 million of revenues for the same period a year ago. As of Sept. 30, 2014, the Company had $185.15 million in total assets, $68.83 million in total liabilities, and $116.31 million in total stockholders' equity. Denis McGlynn, the Company's president and chief executive officer, stated: "While the legislation that was passed on June 30 has been helpful, we have operated at a loss for the first nine months of the year. We're continuing our discussions with the state with the goal of arriving at a new formula for the distribution of gaming revenues. Just as changes to the formula have been made over the years to steadily increase the state's share, change is again needed to allow the gaming industry to earn a fair rate of return on their investments taking into account the increased gaming supply in the region. The "Delaware Lottery & Gaming Study Commission" has reconvened and will be meeting through the end of the year with commission recommendations to the Governor and the legislature due by January 15." A copy of the press release is available for free at: http://is.gd/XNIf9v Owned by Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE), Dover Downs Hotel & Casino(R) is a gaming and entertainment resort destination in the Mid-Atlantic region. Gaming operations consist of approximately 2,500 slots and a full complement of table games including poker. The AAA-rated Four Diamond hotel is Delaware's largest with 500 luxurious rooms/suites and amenities including a full-service spa/salon, concert hall and 41,500 sq. ft. of multi- use event space. Live, world-class harness racing is featured November through April, and horse racing is simulcast year-round. Professional football parlay betting is accepted during the season. Additional property amenities include multiple restaurants from fine dining to casual fare, bars/lounges and retail shops. For more information, please visit www.doverdowns.com. As reported by the TCR on Oct. 31, 2014, Dover Downs was notified by the New York Stock Exchange that the average closing price of our common stock had fallen below $1.00 per share over a period of 30 consecutive trading days, which is the minimum average share price for continued listing on the NYSE under the NYSE Listed Company Manual. KPMG LLP, in Philadelphia, Pennsylvania, 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 credit facility expires on June 17, 2014, and at present no agreement has been reached to refinance the debt, which raises substantial doubt about the Company's ability to continue as a going concern. DOVER DOWNS: Posts $699,000 Net Earnings in Third Quarter --------------------------------------------------------- Dover Downs Gaming & Entertainment, Inc., reported net earnings of $699,000 on $47.98 million of revenues for the three months ended Sept. 30, 2014, compared to net earnings of $223,000 on $50.07 million of revenues for the same period in 2013. For the nine months ended Sept. 30, 2014, the Company reported a net loss of $190,000 on $139.67 million of revenues compared to net earnings of $431,000 on $150.63 million of revenues for the same period a year ago. As of Sept. 30, 2014, the Company had $185.15 million in total assets, $68.83 million in total liabilities, and $116.31 million in total stockholders' equity. Denis McGlynn, the Company's president and chief executive officer, stated: "While the legislation that was passed on June 30 has been helpful, we have operated at a loss for the first nine months of the year. We're continuing our discussions with the state with the goal of arriving at a new formula for the distribution of gaming revenues. Just as changes to the formula have been made over the years to steadily increase the state's share, change is again needed to allow the gaming industry to earn a fair rate of return on their investments taking into account the increased gaming supply in the region. The "Delaware Lottery & Gaming Study Commission" has reconvened and will be meeting through the end of the year with commission recommendations to the Governor and the legislature due by January 15." A copy of the press release is available for free at: http://is.gd/XNIf9v Owned by Dover Downs Gaming & Entertainment, Inc. (NYSE: DDE), Dover Downs Hotel & Casino(R) is a gaming and entertainment resort destination in the Mid-Atlantic region. Gaming operations consist of approximately 2,500 slots and a full complement of table games including poker. The AAA-rated Four Diamond hotel is Delaware's largest with 500 luxurious rooms/suites and amenities including a full-service spa/salon, concert hall and 41,500 sq. ft. of multi- use event space. Live, world-class harness racing is featured November through April, and horse racing is simulcast year-round. Professional football parlay betting is accepted during the season. Additional property amenities include multiple restaurants from fine dining to casual fare, bars/lounges and retail shops. For more information, please visit www.doverdowns.com. As reported by the TCR on Oct. 31, 2014, Dover Downs was notified by the New York Stock Exchange that the average closing price of our common stock had fallen below $1.00 per share over a period of 30 consecutive trading days, which is the minimum average share price for continued listing on the NYSE under the NYSE Listed Company Manual. KPMG LLP, in Philadelphia, Pennsylvania, 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 credit facility expires on June 17, 2014, and at present no agreement has been reached to refinance the debt, which raises substantial doubt about the Company's ability to continue as a going concern. EC SEQUIM: Case Summary & 4 Unsecured Creditors ----------------------------------------------- Debtor: EC Sequim Properties, LLC c/o Gary Morgan 2930 216th Street SW Lynnwood, WA 98036 Case No.: 14-18131 Nature of Business: Single Asset Real Estate Chapter 11 Petition Date: November 5, 2014 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Hon. Karen A. Overstreet Debtor's Counsel: Nathan T. Riordan, Esq. RIORDAN LAW PS 600 Stewart St Ste 1300 Seattle, WA 98101 Tel: 206-903-0401 Email: nate@riordan-law.com Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Hilda Rodriguez, member. A list of the Debtor's four largest unsecured creditors is available for free at http://bankrupt.com/misc/wawb14-18131.pdf EDGEFIELD INN: Creditor Wins Dismissal of Chapter 11 Case --------------------------------------------------------- Chief Bankruptcy Judge David R. Duncan granted the motion of Scarlet Portfolio, LLC to dismiss the Chapter 11 bankruptcy case of Edgefield Inn, LLC. Edgefield Inn filed for protection under chapter 11 of the Bankruptcy Code (Bankr. D. S.C. Case No. 14-01670-DD) on March 24, 2014. The Debtor is a small business, as defined by 11 U.S.C. Sec. 101(51D), consisting of a 46-room inn in Edgefield, SC. All of the Debtor's real estate and personal property is encumbered by a loan from Scarlet Portfolio, scheduled at $853,121. The Debtor has two tax creditors, the Internal Revenue Service and Edgefield County, with scheduled claims of $25,000 and $20,522, respectively. Both claims are scheduled as secured. The Debtor values its property at $910,606; thus, all secured creditors are, or were at the time of the filing, oversecured. The Debtor scheduled an insider debt of $1,309,203 owed to Bettis Rainsford, Edgefield Inn's sole owner. The deadline for filing proofs of claim in this case was July 28, 2014. Creditor Scarlet Portfolio filed its motion to dismiss on August 19, 2014. Scarlet Portfolio argues that the case should be dismissed for cause because (1) the Debtor cannot propose a plan with an impaired, consenting class and therefore cannot confirm a plan; and (2) the Debtor filed in bad faith in that it has no realistic ability to reorganize and it made improper pre-petition payments to insiders it is not seeking to collect. Scarlet Portfolio seeks dismissal with prejudice based on the Debtor's alleged bad faith. The Debtor responded that the Debtor's business is healthy and can be rehabilitated.1 It also asserted it will be able to propose a plan with an impaired, consenting class. The Debtor filed its first plan on October 2, shortly after responding to the motion to dismiss. The plan has five classes. Class 1 consists of the secured claims of Scarlet Portfolio and the IRS. The Scarlet Portfolio claim will be paid the value of its collateral up to the full amount of the claim with interest for 119 months with a balloon payment in the 120th month. The IRS claim will be paid in full with interest over five years. Class 2 consists of the unsecured claims of the IRS and Scarlet Portfolio, if any. They will be paid in full in equal monthly amounts over 300 months. Class 3 consists of "claims of maintenance companies who perform work on a regular basis for the Debtor." These claimants, who were neither scheduled nor filed proofs of claim, will "continue to be paid for services rendered as performed." Class 4 is the general unsecured class consisting of the Rainsford insider claim. Rainsford agrees to waive payment on his claim if the plan is confirmed and he retains ownership of the Debtor. Class 5 is the equity class. It will revest in the Debtor upon confirmation. The Edgefield County claim is not classified, but rather is treated under Article III of the plan as a priority tax claim. It will be paid in full with interest in monthly installments over a period of 54 months. On October 7, 2014, the day before the hearing, the Debtor filed an amended plan and disclosure statement, as well as two new unsecured proofs of claim. The most notable change relevant to this plan is the change to Class 3. Class 3 was redefined to drop the claim of the maintenance companies and add the two new claims. The first claim is the claim of Patricia Berry for executive compensation totaling $6,250. The plan proposes to pay this claim with interest over 60 months in payments of $115.10 per month. The second claim is a class claim on behalf of the current employees of Edgefield Inn for Christmas bonuses accrued from Jan. 1, 2014 through the filing of the petition. The total claim is $363.84. The plan proposes to pay this claim with interest over a period of 60 months in payments of $6.70 per month. The Court held a hearing on the motion to dismiss October 8, 2014. In support of its argument, Scarlet Portfolio provided the Court with testimony from an asset manager from Sabal Financial Group, L.P, the company servicing Scarlet Portfolio's debt. The manager generally established the debt and testified that the Debtor's financial statements show unexplained transfers between the Debtor and two other businesses owned by Rainsford. He also testified that, in his experience, Edgefield Inn has an unusually high number of employees for its size; overspends on breakfast; and lacks enough funds in reserve to keep the Inn's rooms and furnishings properly maintained. He concluded on these facts that Edgefield Inn would have problems successfully reorganizing. The Debtor presented testimony from its owner, Bettis Rainsford. Rainsford testified that the Debtor had been making payments on its debt owned by Scarlet Portfolio since 1997 and had only recently experienced cash flow problems. He testified that the Debtor filed for bankruptcy because it was unable to renegotiate the terms of its loan and was facing foreclosure. He asserted that Edgefield Inn is well-maintained and currently experiencing full or close to full occupancy. He also said he believes that the Inn is positioned to do well in the future because of a new outdoor sporting and recreation development under construction in Edgefield. Patricia Berry also testified. Berry is the general manager of Edgefield Inn. She was hired in May of 2012. She testified that she was unhappy with the salary she was initially offered but accepted employment anyway because Rainsford committed to increasing her yearly salary from $25,000 to $40,000 over time if the occupancy of the Inn improved. After completing her first year of employment, Berry asked Rainsford for a raise. Rainsford told her that the business could not afford to pay her more at that time because it was having financial problems. She revisited this conversation with him later in July of 2014 and he agreed to give her a raise. Berry was aware that Edgefield Inn was in bankruptcy, and saw the "debtor in possession" designation on the Edgefield Inn checks, but when she was told the business was doing fine she did not inquire further. Berry and Rainsford did not have a conversation about filing a proof of claim in this case until shortly before the hearing. Berry also testified regarding the Employees claim, which she drafted. She stated that the employees have received Christmas bonuses every year and are worried they will not receive Christmas bonuses for the time they worked in 2014 prior to the filing of the bankruptcy. She stated the employees asked her to file a proof of claim on their behalf. She also did not discuss the filing of this claim with the Debtor until shortly before the hearing. Berry reiterated Rainsford's assertion that the Inn is doing well. She stated they were nearly sold out on the evening of the hearing and were sold out through the following weekend. According to Judge Duncan, "The Rainsford insider class cannot vote. The unclassified Edgefield County claim cannot vote. The Berry and Employees claims cannot vote. Scarlet Portfolio, whose vote controls both Classes 1 and 2, has indicated it will reject the plan. Thus, due to the nature of the claims in this case, there is no plan the Debtor can propose that would permit the Court to confirm the plan. Because the Debtor cannot file a confirmable plan, the case must be dismissed." A copy of Judge Duncan's Oct. 31 Order is available at http://bit.ly/1vG2QHafrom Leagle.com. EMMANUEL COLLEGE: Misses Nov. 1 Bond Payment Deadline ----------------------------------------------------- Katy Stech, writing for Daily Bankruptcy Review, reported that Georgia's Emmanuel College missed a Nov. 1 deadline to make a payment on about $25.2 million worth of municipal bonds that were used to build a dorm and athletic complex. According to the report, the private, four-year Christian college's failure to make that payment prompted a bond trustee to take about $1.1 million out of the college's reserve fund, according to documents filed Wednesday to the Municipal Securities Rulemaking Board 's database of bond disclosures. EMPIRE RESORTS: Stephen Haberkorn Owns 7.9% Equity Stake -------------------------------------------------------- In a Schedule 13G filed with the U.S. Securities and Exchange Commission, Stephen Haberkorn disclosed that as of June 2, 2014, he beneficially owned 2,953,761 shares of common stock of Empire Resorts, Inc., representing 7.9 percent of the shares outstanding. Mr. Haberkorn has sole voting and dispositive power with respect to 2,953,761 shares of the reported securities as (i) trustee to certain trusts for the benefit of family members; (ii) trustee for a charitable foundation; and (iii) in his personal capacity. A copy of the regulatory filing is available for free at: http://is.gd/7jZjTP About Empire Resorts Based in Monticello, New York, Empire Resorts, Inc. (NASDAQ: NYNY) -- http://www.empireresorts.com/-- owns and operates Monticello Casino & Raceway, a video gaming machine and harness racing track and casino located in Monticello, New York, 90 miles northwest of New York City. Empire Resorts reported a net loss applicable to common shares of $27.05 million in 2013 following a net loss applicable to common shares of $2.26 million in 2012. As of June 30, 2014, the Company had $46.11 million in total assets, $55.62 million in total liabilities and a $9.51 million total stockholders' deficit. EMPIRE TOWERS: Clawback Suit Against Bank of Glen Burnie Tossed --------------------------------------------------------------- Bankruptcy Judge James F. Schneider granted the motion of defendant Bank of Glen Burnie to dismiss the Amended Complaint filed by the Chapter 7 Trustee of Empire Towers Corporation to recover fraudulent conveyances. Wilfred T. Azar, III, is the owner and principal of Empire Towers Corporation, Empire Holdings Corporation, Empire Corporation, and Empire Management Services, LLC. As of the Oct. 27, 2010, Towers owned real property at 7300 and 7310 Governor Ritchie Highway, Glen Burnie, Maryland 21061, in which Towers leased office and retail space to various tenants for rent payable to Towers in monthly installments. Azar directed the tenants to make their rental payments to Corp., a separate legal entity, which deposited the rents into its own account. Corp. retained some of the rent proceeds for its own use and transferred some to third parties, including the Bank of Glen Burnie. Corp. owns property at 500 and 502 Crain Highway, Glen Burnie, Maryland 21061, and derives rent from its long-term tenant, Enterprise Leasing Co. of Baltimore. The Bank made a loan to Corp. secured by both a deed of trust on Corp. Property as well as two assignments of rents generated by Corp. Property. On October 25, 2012, the Chapter 7 Trustee filed the adversary proceeding to recover fraudulent conveyances from the Bank and Corp. On March 4, 2013, the Bank filed the motion to dismiss the amended complaint on the basis that the Trustee's claims against the Bank are barred by Section 550(b)(1) of the Bankruptcy Code, and that the complaint should be dismissed for failure to state a cause of action under Federal Rule of Civil Procedure 12(b)(6), (c), and (d). The case is, JOSEPH J. BELLINGER, Plaintiff/Trustee, v. THE BANK OF GLEN BURNIE and EMPIRE CORPORATION, Defendants, Adv. Proc. No. 12-00713-JS (Bankr. D. Md.). A copy of the Court's Oct. 15 Memorandum Opinion is available at http://bit.ly/10xGgrSfrom Leagle.com. About Empire Towers and Empire Holdings Empire Towers Corporation is the owner of a real property located at 7300-7310 Ritchie Highway, Glen Burnie, Maryland. The office building, built on the property in 1974, is the tallest building in northern Anne Arundel County and currently leases space to business and retail enterprises of a wide variety. Empire Towers filed for Chapter 11 bankruptcy protection (Bankr. D. Md. Case No. 10-34611) on Oct. 27, 2010. Its parent Empire Holdings Corporation also filed for Chapter 11 (Bankr. D. Md. Case No. 10-34580). Aryeh E. Stein, Esq., at Meridian Law LLC, in Baltimore, Maryland, assisted the Debtors in their restructuring effort. The Debtors disclosed $12,482,584 in assets and $14,876,779 in liabilities as of the Chapter 11 filing. On April 27, 2011, upon the motion of the United States Trustee, Joseph J. Bellinger was appointed Chapter 11 Trustee, and upon a motion to convert filed by the U.S. Trustee, the Bankruptcy Court converted the case to a proceeding under Chapter 7 by order dated May 16, 2011. The appointment of the Trustee and the conversion of the case to Chapter 7 were based upon allegations by the United States Trustee that a deficiency existed in "the debtor-in-possession bank accounts of net rental income from the debtors' operations," that "the debtors have never filed with the Court ANY reports of operations since filing the cases," and that "[u]pon information and belief, substantial rental income has been diverted from these debtors-in-possession or, at least is unaccounted for." ENDEAVOUR INT'L: Restructuring Support Agreement Filed ------------------------------------------------------ BankruptcyData reported that Endeavour International asked authority from the U.S. Bankruptcy Court to assume a restructuring support agreement, which reduces Endeavour's existing debt by approximately $568 million, reduces its annual interest burden by approximately 43%, and frees approximately $50 million in cash flow for reinvestment into preserving and developing its businesses. According to the report, in late June 2014, recognizing the benefits of a cooperative restructuring process, Endeavour initiated negotiations with its disparate creditor groups in an effort to broker a proposed restructuring transaction that would significantly de-lever Endeavour and reduce its approximately $1.2 billion in debt. Under the Restructuring Support Agreement, holders of approximately 75.4% of the March 2018 First Priority Notes, 69.88% of the Second Priority Notes, 66.7% of the Convertible Notes (comprised of 62.15% of the 5.5% Convertible Notes and 100% of the 6.5% Convertible Senior Notes) and 99.75% of the 7.5% Convertible Bonds have agreed to support the Endeavour plan of reorganization, the report related. The Court scheduled a November 10, 2014 hearing to consider the motion and objections must be filed by November 3, 2014. About Endeavour International Houston-based Endeavour International Corporation (NYSE: END) (LSE: ENDV) is an oil and gas exploration and production company focused on the acquisition, exploration and development of energy reserves in the North Sea and the United States. On Oct. 10, 2014, Endeavour International and five affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code after reaching a restructuring deal with noteholders. The cases are pending joint administration under Endeavour Operating Corp.'s Case No. 14-12308 before the Honorable Kevin J. Carey (Bankr. D. Del.). As of June 30, 2014, the Company had $1.55 billion in total assets, $1.55 billion in total liabilities, $43.70 million in series c convertible preferred stock, and a $41.48 million stockholders' deficit. The Debtors have tapped Weil, Gotshal & Manges LLP as counsel; Richards, Layton & Finger, P.A., as co-counsel; The Blackstone Group L.P., as financial advisor; AlixPartners, LLP, as restructuring advisor; and Kurtzman Carson Consultants LLC, as claims and noticing agent. ENERGY FUTURE: Posts $49MM Net Income in Third Quarter ------------------------------------------------------ Energy Future Holdings Corp. filed with the Securities and Exchange Commission its report on Form 10-Q for the quarterly period ended September 30, 2014. EFH Corp posted net income of $49 million during the quarter compared to $5 million for the same period last year. Operating revenues were $1.807 billion for the three-month period, compared to $1.893 billion during the same period last year. However, for the past nine months, EFH Corp posted $1.334 billion of net losses. During the nine-month period in 2013, EFH Corp's net loss was $635 million. Operating revenues were $4.731 billion for the nine-month period, compared to $4.572 billion during the same period in 2013. EFH Corp. reported $35.884 billion in total assets against $1.968 billion in total liabilities. A copy of the Form 10-Q Report is available at http://1.usa.gov/1E9ze9H Proposed Sale of Economic Interest in Oncor In September 2014, with input and support from several key stakeholders, the Debtors filed a motion with the Bankruptcy Court seeking the entry of an order approving bidding procedures with respect to the potential sale of EFH Corp.'s/EFIH's economic interest in Oncor. During October 2014, the bankruptcy court held hearings regarding the motion. On November 3, 2014, the Bankruptcy Court conditionally approved the motion. In conditionally approving the motion, the Bankruptcy Court required that, among other things, the Debtors modify the proposed bidding procedures and order to (a) allow up to five advisors for each of the official unsecured creditor committees at TCEH and EFH Corp./EFIH to access information regarding the bidding process on terms to be negotiated with these advisors, (b) allow additional time for bidders to evaluate potential transactions and submit bids and (c) prohibit material modifications to the bid procedures without the consent of the committees or further order of the Bankruptcy Court. In addition, the Bankruptcy Court required that prior to a modified order becoming effective, the respective boards of directors of EFH Corp., EFCH, TCEH and EFIH must vote to approve the proposed modified bidding procedures (along with an affirmative vote of the respective disinterested directors at EFIH and TCEH). The Debtors intend to continue to work closely with each of their respective stakeholders to formulate a bidding process that will maximize enterprise value for each of the Debtors. Tax Matters In June 2014, EFH Corp. filed a request with the IRS for a private letter ruling (Private Letter Ruling) that, among other things, will provide (a) that (i) the transfer by TCEH of all of its assets and its ordinary course operating liabilities to reorganized TCEH consummated through a tax-free spin (in accordance with the Private Letter Ruling) in connection with TCEH's emergence from bankruptcy (Reorganized TCEH), (ii) the transfer by the Debtors to Reorganized TCEH of certain operating assets and liabilities that are reasonably necessary to the operation of Reorganized TCEH and (iii) the distribution by TCEH of (A) the equity it holds in Reorganized TCEH and (B) the cash proceeds TCEH receives from Reorganized TCEH to the holders of TCEH first lien claims, will qualify as a "reorganization" within the meaning of Sections 368(a)(1)(G), 355 and 356 of the Code and (b) for certain other rulings under Sections 368(a)(1)(G) and 355 of the Code. The Debtors intend to continue to pursue the Private Letter Ruling in connection with any Chapter 11 plan of reorganization that is ultimately proposed. In October 2014, the Debtors filed a memorandum with the Bankruptcy Court that described tax related matters regarding restructuring alternatives. Pre-Petition Claims Holders of pre-petition claims will be required to file proofs of claims by the "bar date" established by the Bankruptcy Court. A bar date is the date by which certain claims against the Debtors must be filed if the claimants wish to receive any distribution in the Chapter 11 Cases. In August 2014, the Bankruptcy Court established a bar date of October 27, 2014 for most claims. "We have received numerous proofs of claim since the Petition Date. We are early in the process of reconciling those claims to the amounts listed in our schedules of assets and liabilities. We may ask the Bankruptcy Court to disallow claims that we believe are duplicative, have been later amended or superseded, are without merit, are overstated or should be disallowed for other reasons. Given the substantial number of claims filed, the claims resolution process will take considerable time to complete," the Company said. About Energy Future 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: U.S. Trustee Balks at Employment of Ernst & Young ---------------------------------------------------------------- Roberta A. DeAngelis, U.S. Trustee for Region 3, objected to Energy Future Holdings Corp., et al.'s motion for permission to employ Ernst & Young LLP as providers of tax advisory and information technology services effective nunc pro tunc to the Petition Date. According to the U.S. Trustee, EY has an actual conflict by representing a party with interests that are adverse to the Debtors' estates. It notes that the Debtors sought to employ EY when it has been working for the Ad Hoc Committee of EFIH Unsecured Noteholders for nearly a year and will continue to do so at the Debtors' expense. As reported in the Troubled Company Reporter on June 11, 2014, pursuant to the appliation, EY will provide certain tax advisory and information technology consulting services, in connection with the chapter 11 cases. About Energy Future 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. EXIDE TECHNOLOGIES: Enters Into Plan Support Pact With Noteholders ------------------------------------------------------------------ Exide Technologies Inc. has entered into a plan support agreement with holders of a majority of the principal amount of the Company's senior secured notes. The PSA includes a detailed term sheet which describes a plan of reorganization. Pursuant to the PSA, the Supporting Noteholders, who also hold a substantial majority of the Company's estimated $360 million DIP Credit Facility's term loan, have agreed to support the Plan which would deleverage the Company by more than $600 million and allow Exide to emerge from Chapter 11 substantially in its current form -- operating across all of its existing business segments. Under the Plan, certain of the Supporting Noteholders have agreed to convert at least $100 million of their DIP facility claims into new second lien convertible debt and roll the balance of their DIP loans into a new exit term loan. The Plan also contemplates a new $175 million capital commitment to be raised in a rights offering made available to eligible holders of the Debtor's pre-petition 8.625 percent senior secured notes. There is substantial support among the Supporting Noteholders for entering into a backstop agreement for the new capital, and the Company continues to negotiate the terms of such an agreement with the hopes of finalizing it in the coming weeks. In addition, the Company has initiated the sales process contemplated by the terms of Amendment No. 8 of its DIP facility, which the U.S. Bankruptcy Court approved on Oct. 31, 2014, by soliciting potential interest from third parties for a sale of the Company's businesses. This dual-track process will allow the Company to ensure that it has explored opportunities to maximize estate value. "The PSA is another significant, positive step forward in our restructuring process," said Robert M. Caruso, the Company's President and Chief Executive Officer. The PSA and Term Sheet are conditioned upon the negotiation of, and agreement to, definitive documents (including a plan of reorganization, disclosure statement, backstop commitment agreement, and other related documents and agreements). The Company aims to emerge from the Chapter 11 restructuring of its U.S. operations by March 31, 2015. About Exide Technologies Headquartered in Princeton, New Jersey, Exide Technologies (NASDAQ: XIDE) -- http://www.exide.com/-- manufactures and distributes lead acid batteries and other related electrical energy storage products. Exide first sought Chapter 11 protection (Bankr. Del. Case No. 02-11125) on April 14, 2002 and exited bankruptcy two years after. Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland & Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl & Jones LLP represented the Debtors in their successful restructuring. Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No. 13-11482) on June 10, 2013. Exide disclosed $1.89 billion in assets and $1.14 billion in liabilities as of March 31, 2013. Exide's international operations were not included in the filing and will continue their business operations without supervision from the U.S. courts. For the new case, Exide has tapped Anthony W. Clark, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez & Marsal as financial advisor; Sitrick and Company Inc. as public relations consultant and GCG as claims agent. Schnader Harrison Segal & Lewis LLP was tapped as special counsel. The Official Committee of Unsecured Creditors is represented by Lowenstein Sandler LLP and Morris, Nichols, Arsht & Tunnell LLP as co-counsel. Zolfo Cooper, LLC serves as its bankruptcy consultants and financial advisors. Geosyntec Consultants was tapped as environmental consultants to the Committee. Robert J. Keach of the law firm Bernstein Shur as fee examiner has been appointed as fee examiner. He has hired his own firm as counsel. FALCON STEEL: Committee Seeks to Retain Deloitte as Fin'l Advisor ----------------------------------------------------------------- The Official Committee of Unsecured Creditors in the case of Falcon Steel Company and New Falcon Steel, LLC, seeks permission from the Bankruptcy Court to retain Deloitte Transactions and Business Analytics LLP as its financial advisor. As financial advisor, Deloitte Transactions is expected to: a. Assist the Committee with its evaluation of the Debtors' financial restructuring process, including its analysis of the development of plans of reorganization and related disclosure statement(s); b. Assist the Committee in its analysis of Chapter 11 plan, disclosure statements, and related documents and information, including preliminary and updated assessments of the Debtors' forecasts and assertions of feasibility; and c. Assist the Committee in connection with its initial evaluation of the business and financial impact of various operational, financial, and strategic restructuring alternatives. The firm's standard rates are: Professional Hourly Rates ------------ ------------ Louis E. Robichaux, IV, Principal $625/hour Russell A. Perry, Senior Vice President $475/hour Louis E. Robichaux IV, a principal at Deloitte Transactions, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Falcon Steel Company Falcon Steel Company and New Falcon Steel, LLC, sought Chapter 11 protection in the U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division (Case Nos. 14-42585 and 14-42586) on June 29, 2014. Falcon Steel claims to be the only American-owned company that builds steel lattice towers for high electrical transmission lines. Falcon Steel was formed in 1963 and has operated continuously since that time as a manufacturer engaged in fabricating and galvanizing structural steel for customers in the United States. New Falcon, a subsidiary, suspended operations in June 2013 and is being held for sale. Falcon has three manufacturing plants in the DFW area in Texas, with one facility in Haltom City, another in Euless, and the third facility in Kaufman, Texas. The company's corporate headquarters is located at its Haltom City plant. It currently employs approximately 255 employees. Bankruptcy Judge D. Michael Lynn, in an amended order, directed the joint administration of the case of Falcon Steel Company and New Falcon Steel, LLC (Lead Case No. 14-42585). Falcon Steel estimated assets and debt of $10 million to $50 million. The Debtors have tapped Forshey & Prostok, LLP, as general counsel and employ Decker, Jones, McMackin, McClane, Hall & Bates, P.C. as special corporate counsel. Ryan LLC acts as property tax consultant. The Debtors also tapped Western Operations LLC as financial consultant, and Rylander, Clay & Opitz, LLP, as accountants. The U.S. Trustee has appointed a five-member panel to serve as the official unsecured creditors committee in the Debtors' cases. The Committee has tapped McCathern, PLLC, as counsel. FALCON STEEL: Panel Objects to Exclusive Period Extensions ---------------------------------------------------------- The Official Committee of Unsecured Creditors of Falcon Steel Company and New Falcon Steel, LLC, filed an objection to the Debtors' motion for an extension of their exclusive period for filing and soliciting acceptances of a plan of reorganization. The Committee complains that the Debtors have achieved very little, if anything, in the case towards confirming a plan. To date, the Committee points out, the Debtors have incurred over $500,000 in professional fees, and have little to show for it other than to have employed or sought to employ a host of professionals, including a CRO, whose application was withdrawn after substantial objections were made, and the Debtors' former CEO whose application sought a broad release of liability. The Debtors do not even have a simple set of financial projections, the Committee laments. The Committee says that perhaps more troubling is that the Debtors are apparently attempting to market and sell certain significant assets without prior Court approval or the employment of professionals to do so, all the while cutting out the Committee from any meaningful plan negotiations. Instead, the Committee continues, the Debtors appear to be focusing their efforts on negotiating a plan with Texas Capital Bank -- the very party who brought the Debtors to their knees and forced them to file bankruptcy after sweeping $1.4 million of cash from FSC's bank account. The Committee adds that other than basic loan documents, the Debtors have not provided any documents it has requested, including any plan projections by which it can reasonably evaluate plan terms proposed by the Debtors or Texas Capital, and Texas Capital has sought to stall the production of such documents on the basis that a 100 cent plan might well be confirmed. The Committee is concerned that the Debtors and Texas Capital are attempting to negotiate a "take it or leave it" plan -- a plan which might provide for the retention of equity without new value, and which may even provide equity to Texas Capital -- without the Committee's full participation or input, and without discussing the impact of potential claims that could be brought against Texas Capital and other parties, including the Debtors' current or former officers and directors. "Simply put, it appears that the Debtors and Texas Capital have preempted any attempts by the Committee or other parties from meaningfully negotiating plan terms that are based on anything other than the Debtors' revenue from operations and a continuation of a troubling relationship with Texas Capital," the Committee contends. The Committee asserts that the Debtors cannot establish "cause" to extend exclusivity given the problematic nature of their conduct and lack of progress towards a consensual plan. Therefore, the Committee asks the Court to deny the Exclusivity Motion so that other parties, including the Committee, may develop, file, and seek confirmation of plans of reorganization. The Troubled Company Reporter related on Oct. 21, 2014, that the Debtors sought an extension of their exclusive plan filing period through Dec. 26, 2014, and their exclusive plan solicitation period through Feb. 24, 2015. About Falcon Steel Company Falcon Steel Company and New Falcon Steel, LLC, sought Chapter 11 protection in the U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division (Case Nos. 14-42585 and 14-42586) on June 29, 2014. Falcon Steel claims to be the only American-owned company that builds steel lattice towers for high electrical transmission lines. Falcon Steel was formed in 1963 and has operated continuously since that time as a manufacturer engaged in fabricating and galvanizing structural steel for customers in the United States. New Falcon, a subsidiary, suspended operations in June 2013 and is being held for sale. Falcon has three manufacturing plants in the DFW area in Texas, with one facility in Haltom City, another in Euless, and the third facility in Kaufman, Texas. The company's corporate headquarters is located at its Haltom City plant. It currently employs approximately 255 employees. Bankruptcy Judge D. Michael Lynn, in an amended order, directed the joint administration of the case of Falcon Steel Company and New Falcon Steel, LLC (Lead Case No. 14-42585). Falcon Steel estimated assets and debt of $10 million to $50 million. The Debtors have tapped Forshey & Prostok, LLP, as general counsel and employ Decker, Jones, McMackin, McClane, Hall & Bates, P.C. as special corporate counsel. Ryan LLC acts as property tax consultant. The Debtors also tapped Western Operations LLC as financial consultant, and Rylander, Clay & Opitz, LLP, as accountants. The U.S. Trustee has appointed a five-member panel to serve as the official unsecured creditors committee in the Debtors' cases. The Committee has tapped McCathern, PLLC, as counsel. FALCON STEEL: Texas Capital Bank Wants Short Plan Extension ----------------------------------------------------------- Secured creditor Texas Capital Bank, National Association, asks the Bankruptcy Court to enter an order extending the Debtors' exclusivity periods for only 30 days. Texas Capital relates that it provided the Debtors with a detailed plan term sheet on Oct. 3, 2014, and the Debtors did not deliver a response to the term sheet until Oct. 20. Although the Debtors' response took more time than Texas Capital had hoped, in light of the exchange of plan term sheets, Texas Capital anticipates the parties will continue to work in good faith toward confirmation of a consensual plan. A 30-day extension should give the parties sufficient time to negotiate plan terms or, at least, determine whether significant progress is being made and an additional extension of time is warranted, Texas Capital says. About Falcon Steel Company Falcon Steel Company and New Falcon Steel, LLC, sought Chapter 11 protection in the U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division (Case Nos. 14-42585 and 14-42586) on June 29, 2014. Falcon Steel claims to be the only American-owned company that builds steel lattice towers for high electrical transmission lines. Falcon Steel was formed in 1963 and has operated continuously since that time as a manufacturer engaged in fabricating and galvanizing structural steel for customers in the United States. New Falcon, a subsidiary, suspended operations in June 2013 and is being held for sale. Falcon has three manufacturing plants in the DFW area in Texas, with one facility in Haltom City, another in Euless, and the third facility in Kaufman, Texas. The company's corporate headquarters is located at its Haltom City plant. It currently employs approximately 255 employees. Bankruptcy Judge D. Michael Lynn, in an amended order, directed the joint administration of the case of Falcon Steel Company and New Falcon Steel, LLC (Lead Case No. 14-42585). Falcon Steel estimated assets and debt of $10 million to $50 million. The Debtors have tapped Forshey & Prostok, LLP, as general counsel and employ Decker, Jones, McMackin, McClane, Hall & Bates, P.C. as special corporate counsel. Ryan LLC acts as property tax consultant. The Debtors also tapped Western Operations LLC as financial consultant, and Rylander, Clay & Opitz, LLP, as accountants. The U.S. Trustee has appointed a five-member panel to serve as the official unsecured creditors committee in the Debtors' cases. The Committee has tapped McCathern, PLLC, as counsel. FINJAN HOLDINGS: Amends Employment Agreement With CFO ----------------------------------------------------- Finjan Holdings, Inc., entered into an amended and restated employment agreement with Shimon Steinmetz, the Company's chief financial officer and treasurer, according to a regulatory filing with the U.S. Securities and Exchange Commission. The Agreement provides that Mr. Steinmetz will continue as the Company's chief financial officer and treasurer through an initial term ending on Nov. 30, 2014, subject to extension on a monthly or other basis as mutually agreed between the Company and Mr. Steinmetz, unless earlier terminated. The Agreement provides for a base salary of $200,000, an annual target bonus of $50,000 and eligibility for participation in the Company's equity incentive plans and benefits programs. The Company may terminate Mr. Steinmetz at any time, and if that termination is without cause or results from the failure by the Company and Mr. Steinmetz to renew the Executive's employment beyond the Initial Term, the Executive will be entitled to a two month transition period ending on Jan. 31, 2015. Following that transition period, Mr. Steinmetz will be entitled, in addition to any accrued obligations (including base salary and the 2014 annual target bonus), to a severance payment that includes, among other things, six months of base salary, 50% of the 2015 annual target bonus, accelerated vesting of up to 57,911 options to purchase shares of common stock, which options will remain exercisable until June 30, 2016, and payment of certain expenses. About Finjan Finjan, formerly known as Converted Organics, is a leading online security and technology company which owns a portfolio of patents, related to software that proactively detects malicious code and thereby protects end-users from identity and data theft, spyware, malware, phishing, trojans and other online threats. Founded in 1997, Finjan is one of the first companies to develop and patent technology and software that is capable of detecting previously unknown and emerging threats on a real-time, behavior-based basis, in contrast to signature-based methods of intercepting only known threats to computers, which were previously standard in the online security industry. Finjan Holdings reported a net loss of $6.07 million in 2013 following net income of $50.98 million in 2012. The Company reported a net loss of $2 million on $175,000 of revenues for the three months ended March 31, 2014. The Company's balance sheet at June 30, 2014, showed $24.51 million in total assets, $2.05 million in total liabilities and $22.46 million in total stockholders' equity. FIRED UP: Gets Court Approval to Borrow $450,000 from IBW --------------------------------------------------------- Fired Up Inc. received the green light from U.S. Bankruptcy Judge Tony Davis to borrow up to $450,000 from Independent Bank of Waco to finance its acquisition of a new point of sale system. The loan will be repaid in monthly installments at an interest rate of 3.5%. It will be secured by a certificate of deposit posted by two of Fired Up's shareholders, Creed and Lynn Ford. The company's property won't be subject to any liens to secure the post-petition financing, according to Judge Davis' order. About Fired Up, Inc. Fired Up, Inc., the Austin, Texas-based owner and operator of the Johnny Carino's Italian restaurant chain, sought Chapter 11 bankruptcy protection (Bankr. W.D. Tex. Case No. 14-10447) on March 27, 2014, in Austin. The Debtor is represented by attorneys at Barron & Newburger, P.C., in Austin. It estimated assets and debt of $10 million to $50 million. As of the bankruptcy filing, Fired Up had 2,900 employees and owned and operated 46 company-owned stores known as Johnny Carino's Italian in seven states (Texas, Arkansas, Colorado, Louisiana, Idaho, Kansas and Missouri) and 61 franchised or licensed locations in 17 states and four other countries (Bahrain, Dubai, Egypt and Kuwait). The company began its own "out of court" reorganization in the last quarter of 2013 by closing 20 unprofitable restaurants. The company later opted to seek bankruptcy protection to tie up the "loose ends" of its self-imposed "reorganization" that did not appear capable of being tied up without litigation. In particular, the provisions of the Bankruptcy Code with respect to the rejection of burdensome leases and the ability to propose and pay out its debts pursuant to a Plan without piecemeal prosecution by random uncooperative creditors undermining same were particularly attractive. For the fiscal year ending June 27, 2012, the company reported total revenues of $125.7 million, net income of $614,000, and guest counts of 8.6 million. For the fiscal year ending June 26, 2013, the company reported total revenues of $120.8 million, a net loss of $5.9 million, and guest counts totaling 8.5 million. The Debtor disclosed $10,360,877 in assets and $36,139,375 in liabilities. Creed Ford III is the majority shareholder and has served as president and CEO since 2008. Mr. Ford and Norman J. Abdallah formed Fired Up in 1997 for the purpose of acquiring the then six- unit Johnny Carino's Italian Kitchen chain from Brinker International, Inc. The U.S. Trustee appointed a seven-member Official Committee of Unsecured Creditors. The Committee tapped Pachulski Stang Ziehl & Jones LLP as its counsel, and FTI Consulting, Inc. as its financial advisor. FOUR OAKS: Imposes Restrictions on Common Stock Transfer -------------------------------------------------------- Four Oaks Fincorp, Inc., held a special meeting of shareholders on Oct. 27, 2014, at which the shareholders approved an amendment to the Company's Articles of Incorporation that will restrict certain transfers of the Company's capital stock in order to preserve the tax treatment of certain net operating losses and other tax benefits, according to a Form 8-K filed with the U.S. Securities and Exchange Commission. The shareholders also ratified the Tax Asset Protection Plan, dated as of Aug. 18, 2014, between the Company and Registrar and Transfer Company, as Rights Agent. On Oct. 28, 2014, Four Oaks filed Articles of Amendment to the Company's Articles of Incorporation, as amended, with the North Carolina Department of the Secretary of State adding a new Article 10 thereto that imposes certain transfer restrictions on the Company's capital stock, including the Company's common stock, $1.00 par value per share, to help preserve certain tax benefits primarily associated with the Company's net operating losses carryovers. These transfer restrictions generally restrict any direct or indirect transfer of any of the Company's capital stock if the effect would be to: (1) increase the direct or indirect ownership of Common Stock by any person to 4.99% or more of the then-outstanding Common Stock; or (2) increase the percentage of the Company's capital stock owned directly or indirectly by any person that owned more than 4.99% of the Company's outstanding Common Stock as of the effective time of the Charter Amendment, in each case subject to limited exceptions. About Four Oaks Based in Four Oaks, North Carolina, Four Oaks Fincorp, Inc., is the bank holding company for Four Oaks Bank & Trust Company. The Company has no significant assets other than cash, the capital stock of the bank and its membership interest in Four Oaks Mortgage Services, L.L.C., as well as $1,241,000 in securities available for sale as of Dec. 31, 2011. Four Oaks reported a net loss of $350,000 in 2013, a net loss of $6.96 million in 2012 and a net loss of $9.09 million in 2011. As of Sept. 30, 2014, the Company had $837.9 million in total assets, $797.8 million in total liabilities and $40.1 million in total shareholders' equity. Written Agreement "In late May 2011, the Company and the Bank entered into a formal written agreement (the "Written Agreement") with the Federal Reserve Bank of Richmond (the "FRB") and the North Carolina Office of the Commissioner of Banks (the "NCCOB"). Under the terms of the Written Agreement, the Bank developed and submitted for approval, within the time periods specified, plans to: * revise lending and credit administration policies and procedures at the Bank and provide relevant training; * enhance the Bank's real estate appraisal policies and procedures; * enhance the Bank's loan grading and independent loan review programs; * improve the Bank's position with respect to loans, relationships, or other assets in excess of $750,000, which are now or in the future become past due more than 90 days, are on the Bank's problem loan list, or adversely classified in any report of examination of the Bank; and * review and revise the Bank's policy regarding the Bank's allowance for loan and lease losses and maintain a program for the maintenance of an adequate allowance. A material failure to comply with the terms of the Written Agreement could subject the Company to additional regulatory actions and further restrictions on its business. These regulatory actions and resulting restrictions on the Company's business may have a material adverse effect on its future results of operations and financial condition," the Company said in its quarterly report for the period ended March 31, 2014. FRATERFOOD SERVICE: Landlord's $76K Claim for April Rent Okayed --------------------------------------------------------------- Bankruptcy Judge Brian K. Tester in Puerto Rico granted the request of DDR Del Sol LLC, S.E. for payment of administrative expense in the total amount of $76,886.86 in the Chapter 11 case of Fraterfood Service, Inc. The Debtor and DDR Del Sol are parties to a lease agreement for the lease of certain nonresidential property. On April 7, 2014, the Court entered an order granting the Debtor's rejection of the Lease Agreement. The $78,537.23 claim is for rent and other charges due and owing for the month of April. Judge Tester also denied the Debtor's motion requesting a nunc pro tunc order making the effective date of the Court's granting of the Debtor's rejection of the Lease Agreement the same date that the Debtor filed the motion, i.e. March 25, 2014. That amendment would have allowed the Debtor to avoid the incurrence in the rent and other charges for the month of April as administrative expenses. A copy of the Court's Oct. 15, 2014 Opinion and Order is available at http://bit.ly/1x5zw2wfrom Leagle.com. Guaynabo, Puerto Rico-based Fraterfood Service Inc. -- aka Burritos, aka Margaritas, aka Tierra Del Fuego, and aka Fueguito -- filed for Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 14-00002) on January 2, 2014, in Old San Juan. Judge Brian K. Tester presides over the case. Charles Alfred Cuprill, Esq., at Charles A Cuprill, PSC Law Office, serves as the Debtor's counsel. It listed $8.92 million in assets and $13.34 million in liabilities. The petition was signed by Julio F. Mendez Munoz, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/prb14-2.pdf GBG RANCH: Hearing on Case Dismissal Continued Sine Die ------------------------------------------------------- The Bankruptcy Court continued the hearing on motion to dismiss case of GBG Ranch, Ltd., to a date to be determined. The parties, according to courtroom minutes for Oct. 16, 2014 hearing, agreed to continue the hearing on the matter. As reported in the Troubled Company Reporter on Oct. 17, 2014, Guillermo Benavides is seeking the dismissal of the case. Mr. Benavides said that the undisputed facts show that the Debtor is neither insolvent nor unable to pay its debts as they become due. He added that the filed schedules of assets and liabilities state under oath that the Debtor's assets greatly exceed its liabilities -- assets total more than $50 million, while alleged liabilities are less than $10 million. He added that at the Sec. 341 Meeting of Creditors, the Debtor testified that it is able to pay its current and regular operating expenses. In a brief submitted to the Court, the Debtor said that the movant failed to provide notice of the motion to dismiss. The Debtor also said that the motion to dismiss is a case dispositive motion. Though the movant contended that the bankruptcy proceeding filed by the Debtor is really a two party dispute, the creditor matrix indicated otherwise. In a separate filing, the Debtor objected to the motion because Guillermo Benavides Z. has failed to plead or prove any basis that the case was made in bad faith. The motion for appointment of a chapter 11 trustee also failed on the face of the pleading. It is nothing more than a litany of legal authority which has justified the appointment of chapter 11 trustees in other cases. The Debtor is represented by: Leslie M. Luttrell, Esq. LUTTRELL + VILLARREAL Law Group Tel: (210) 426-3605 Fax: (210) 426-3610 E-mail: luttrell@lvlawgroup.net About GBG Ranch, LTD GBG Ranch, LTD, a Texas Limited Partnership, sought Chapter 11 protection (Bankr. S.D. Tex. Case No. 14-50155) in Laredo, Texas on July 8, 2014, without stating a reason. GBG Ranch disclosed $59,952,589 in assets and $5,060,423 in liabilities as of the Chapter 11 filing. The company is represented by the Law Office of Carl M. Barto. Leslie M. Luttrell and the Luttrell + Villareal Law Group serve as special counsel. GENERAL MOTORS: Ignition-Switch Trial Set for January 2016 ---------------------------------------------------------- Jeff Bennett, writing for The Wall Street Journal, reported that U.S. District Judge Jesse M. Furman has set a January 2016 trial date for lawsuits alleging personal injuries or deaths connected to a defective ignition switch in General Motors Co.'s automobiles. According to the Journal, Texas attorney Bob Hilliard, one the lawyers representing owners of older GM cars including Chevrolet Cobalt, Saturn Ion and other small cars, said the trial would pertain only to owners of vehicles involved in auto accidents that occurred after GM emerged from bankruptcy-court protection in July 2009 or are tied to the defective switches. Meanwhile, Stephanie Gleason, writing for Daily Bankruptcy Review, reported that in an opening brief in GM's renewed bankruptcy case, the auto maker is standing its ground in a fight over whether the company is responsible for the economic losses of the owners of 2.6 million recalled vehicles. About Motors Liquidation General Motors Corporation and three of its affiliates filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 09-50026) on June 1, 2009. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Garden City Group is the claims and notice agent of the Debtors. The U.S. Trustee appointed an Official Committee of Unsecured Creditors and a separate Official Committee of Unsecured Creditors Holding Asbestos-Related Claims. Lawyers at Kramer Levin Naftalis & Frankel LLP served as bankruptcy counsel to the Creditors Committee. Attorneys at Butzel Long served as counsel on supplier contract matters. FTI Consulting Inc. served as financial advisors to the Creditors Committee. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, represented the Asbestos Committee. Legal Analysis Systems, Inc., served as asbestos valuation analyst. The Bankruptcy Court entered an order confirming the Debtors' Second Amended Joint Chapter 11 Plan on March 29, 2011. The Plan was declared effect on March 31. On Dec. 15, 2011, Motors Liquidation Company was dissolved. On the Dissolution Date, pursuant to the Plan and the Motors Liquidation Company GUC Trust Agreement, dated March 30, 2011, between the parties thereto, the trust administrator and trustee -- GUC Trust Administrator -- of the Motors Liquidation Company GUC Trust, assumed responsibility for the affairs of and certain claims against MLC and its debtor subsidiaries that were not concluded prior to the Dissolution Date. * * * The Troubled Company Reporter, on Sep. 29, 2014, reported that Standard & Poor's Ratings Services raised its corporate credit rating on U.S. automaker General Motors Co. (GM) to 'BBB-' from 'BB+', and revised the outlook to stable from positive. At the same time, S&P raised its issue-level rating on GM's unsecured debt to 'BBB-' from 'BB+' and simultaneously withdrew its '4' recovery rating on that debt, because S&P do not assign recovery ratings to the issues of investment-grade companies. On Oct. 21, 2014, the TCR reported that Fitch Ratings has assigned a rating of 'BB+' to GM's amended unsecured credit facilities. Fitch currently rates GM's Issuer Default Rating (IDR) 'BB+'. The Rating Outlook is Positive. Fitch has also affirmed and withdrawn the 'BB+' IDR of GM's General Motors Holdings LLC (GM Holdings) subsidiary, as there is no longer any rated debt at the subsidiary, and Fitch does not expect the subsidiary to be an active issuer going forward. Fitch has also withdrawn GM Holdings' unsecured credit facility rating of 'BB+' as the subsidiary is no longer a borrower on the facilities. The TCR, on Nov. 6, 2014, reported that Fitch Ratings has assigned a rating of 'BB+' to GM's proposed issuance of senior unsecured notes. The existing Issuer Default Rating (IDR) for GM is 'BB+' and the Rating Outlook is Positive. GLOBAL COMPUTER: Insists No Conflict of Interest for McGuireWoods ----------------------------------------------------------------- Global Computer Enterprises, Inc., dba GCE, filed a reply in further support of its application to employ McGuireWoods LLP as counsel and in response to the arguments set forth in the objections separately filed by the United States Trustee and the the Department of Justice on behalf of the United States of America. The Oct. 17, 2014 edition of The Troubled Company Reporter related that the U.S. Trustee and the U.S. Government raised concerns on McGuireWoods' representation of both the Debtor and its sole shareholder, Ray Muslimani, and the potential conflict of interest such representation may incur. In its reply, the Debtor asserts that the Objections, which are based entirely on conjecture regarding a "potential" conflict that may happen, should be overruled because the facts demonstrate that there is no conflict of interest with McGuireWoods' dual representation of the Debtor and its Chief Executive Officer/sole shareholder, Mr. Muslimani, in the DOJ Investigation. In fact, the Debtor argues, the Objections do not articulate a single instance where the Debtor has not acted in the best interests of the estate or its creditors or a single current fact indicating that the Debtor's and Mr. Muslimani's interests are divergent and therefore necessitate separate counsel. This is because the objectors cannot do so, the Debtor maintains. Instead, the Debtor continues, the facts establish that there is no conflict of interest because Mr. Muslimani's and the Debtor's interests are completely aligned. The Debtor further contends that with respect to the DOJ Objection, the history of the matter raises concerns that the DOJ's true motivations lie not in its desire to enforce the sanctity of the Bankruptcy Code, but rather in its desire to degrade the ability of the Debtor and Mr. Muslimani to defend themselves. The Debtor points out that under the DOJ's misguided interpretation of the canons of ethical conduct, an attorney would never be able to represent both a debtor and its owner in a government investigation. Accordingly, the Debtor urges that Court to approve the employment application of McGuireWoods. About Global Computer Global Computer Enterprises, Inc., dba GCE, is a cloud-based "software as a service" provider, commonly referred to as a "SAAS," offering financial management solutions primarily to executive departments of the federal government and independent federal government agencies. GCE sought protection under Chapter 11 of the Bankruptcy Code (Case No. 14-13290, Bankr. E.D. Va.) on Sept. 4, 2014. The case is assigned to Judge Robert G. Mayer. The Debtor's counsel is David I. Swan, Esq., at McGuirewoods LLP, in McLean, Virginia. The Debtor's financial advisor is Weinsweig Advisors. The petition was signed by Mike Freeman, interim chief operating officer. Judge Mayer designated Mike Freeman to perform duties imposed upon GCE by the Bankruptcy Code. GLOBAL GEOPHYSICAL: Confirmation Hearing Set for Dec. 9 ------------------------------------------------------- Judge Richard S. Schmidt of the U.S. Bankruptcy Court for the Southern District of Texas, Corpus Christi Division, on Oct. 30, 2014, approved the disclosure statement explaining the joint Chapter 11 plan of reorganization of Global Geophysical Services, Inc., and its debtor affiliates. The confirmation hearing will be held on Dec. 9, 2014, at 10:00 a.m. (prevailing Central Time). Objections to confirmation of the Plan must be filed no later than Dec. 4. In the event the Debtors pursue an alternative transaction, provided the Debtors file any Amended Plan and Disclosure Statement on or before Dec. 9, 2014, the Court shortens the time required for notice of the hearing and objection deadline on the Amended Disclosure Statement, and will set an appropriate time to allow the Claimants to change their votes, if necessary, in support of or against the Amended Plan. The hearing to consider approval of any Amended Disclosure Statement will be on or before Jan. 5, 2015, and the deadline to object to the relief sought at the hearing will be Jan. 2, 2015. The Plan is premised upon a backstop conversion commitment agreement negotiated with an ad hoc group of Senior Noteholders, which holds approximately 57% of the Senior Notes and substantially all of the Company's $151.9 million DIP Loan, and the Official Committee of Unsecured Creditors. The Ad Hoc Group will convert up to $68.1 million of their debt into equity. The Restructuring is predicated on an enterprise value for the Reorganized Debtors of $190 million. The Backstop Conversion Commitment Agreement provides the Debtors the opportunity to engage in a market test, which may result in a transaction that implies a higher Restructuring Enterprise Value. In particular, the Backstop Conversion Commitment Agreement allows the Debtors to implement a competitive sale or plan-sponsor selection process. Under those procedures, the Debtors will solicit a binding commitment from an entity of sufficient financial means to sponsor a Chapter 11 plan that provides the Company with additional capital, provides for the purchase of part or all of the Company, or undertakes any other restructuring, provided the proposal: (i) provides for payment of the DIP Loan Claims in full in cash on the Effective Date of any plan, as well as payment of the Termination Payment and Expense Reimbursement; (ii) is based on a higher implied enterprise value than the sum of the Restructuring Enterprise Value, the Minimum Overbid Increment, the Termination Payment, and the Expense Reimbursement; (iii) is higher and better in all material respects when viewed as a whole, and given the facts and circumstances of these Chapter 11 Cases, than the restructuring proposed in the Plan; and (iv) can be consummated no later than Feb. 27, 2015. The $200 million in 10.5 percent senior unsecured notes due 2017 last traded on Oct. 31 for 4.798 cents on the dollar, Bill Rochelle and Sherri Toub, bankruptcy columnists for Bloomberg News, reported citing Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. A full-text copy of the Second Amended Disclosure Statement dated Oct. 31, 2014, is available at: http://bankrupt.com/misc/AUTOSEISds1103.pdf All objections, including the objection raised by Tannor Capital Advisors, to the Disclosure Statement that have not been otherwise resolved are overruled. BankruptcyData reported that Tannor, which owns unsecured trade claims against the Debtors' estates in the approximate amount of $1.5 million, complaining that there is nothing in the Disclosure Statement advising it whether it is helped or hurt by the deemed substantive consolidation. About Global Geophysical, Autoseis et al. Global Geophysical Services Inc., a provider of seismic data for the oil and gas drilling industry, sought bankruptcy protection, intending to reorganize on its own with additional capital or explore a sale or other transaction. Based in Missouri City, Texas, Global Geophysical disclosed assets of $468.7 million and liabilities totaling $407.3 million as of Sept. 30, 2013. Liabilities include $81.8 million on a secured term loan owing to TPG Specialty Lending Inc. and Tennenbaum Capital Partners LLC. TPG is the lenders' agent. Global also owes $250 million on two issues of 10.5 percent senior unsecured notes, with Bank of New York Mellon Trust Co. as indenture trustee. Global Geophysical and five affiliates, including Autoseis, Inc. (lead debtor), filed Chapter 11 petitions in Corpus Christi, Texas (Bankr. S.D. Tex. Lead Case No. 14-20130) on March 25, 2014. The Debtors are represented by C. Luckey McDowell, Esq., Omar Alaniz, Esq., and Ian E. Roberts, Esq., at Baker Botts, LLP, in Dallas, Texas; and Shelby A. Jordan, Esq., and Nathanial Peter Holzer, Esq., at Jordan, Hyden, Womble, Culbreth, & Holzer, PC in Corpus Christi, Texas. Alvarez & Marsal serves as the Debtors' restructuring advisors, Fox Rothschild Inc. as financial advisor, and Prime Clerk as claims and noticing agent. The U.S. Trustee for Region 7, has selected seven creditors to the Official Committee of Unsecured Creditors. The Committee tapped Greenberg Traurig, LLP as counsel; and Lazard Freres & Co. LLC and Lazard Middle Market LLC, as financial advisors and investment bankers. The Ad Hoc Group of Noteholders and the DIP Lenders are represented by Marty L. Brimmage, Jr., Esq., Charles R. Gibbs, Esq., Michael S. Haynes, Esq., and Lacy M. Lawrence, Esq., at Akin Gump Strauss Hauer & Feld LLP. Prepetition secured lender TPG is represented by David M. Bennett, Esq., Tye C. Hancock, Esq., and Joseph E. Bain, Esq., at Thompson & Knight LLP; and Adam C. Harris, Esq., Lawrence V. Gelber, Esq., David M. Hillman, Esq., and Brian C. Tong, Esq., at Schulte Roth & Zabel LLP. GREEN EARTH: Registers 65.1 Million Shares for Resale ----------------------------------------------------- Green Earth Technologies, Inc., filed with the U.S. Securities and Exchange Commission a Form S-1 registration statement relating to the sale, from time to time, by Francesco Galesi, WRG2, LLC, D&L Partners, LP, et al., of up to 65,118,521 shares of the Company's common stock, of which 54,682,051 shares are issuable upon exercise of the conversion rights contained in the Company's 6.0% Secured Convertible Debentures due March 31, 2016, in the aggregate principal of $3,954,000 and 10,436,470 shares are issuable upon exercise of warrants expiring between March 31, 2018, and Sept. 30, 2018. The conversion price of Debentures in the aggregate principal amount of $1,250,000 and $2,704,000 are $0.13 and $0.06 per share of the Company's common stock, respectively, and the exercise price of certain of the Warrants for up to 3,676,470 and 6,760,000 shares of the Company's common stock are $0.15 and $0.21 per share, respectively. The Company will not receive any proceeds from the sale of these shares by the Selling Stockholders. However, the Company did realize gross proceeds of $3,954,000 from the sale of the Debentures and Warrants and the Company will realize gross proceeds of $1,971,070 if all of the Warrants are exercised. The Company's common stock is registered under Section 12(g) of the Securities Exchange Act of 1934, as amended, and is quoted on the QB tier of the OTC Markets Group under the symbol "GETG." A copy of the Form S-1 is available for free at: http://is.gd/lTldh4 About Green Earth Technologies White Plains, N.Y.-based Green Earth Technologies, Inc. (OTC QB: GETG) -- http://www.getg.com/-- markets, sells and distributes bio-degradable performance and cleaning products. The Company's product line crosses multiple industries including the automotive aftermarket, marine and outdoor power equipment markets. Green Earth incurred a net loss of $6.84 million for the year ended June 30, 2014, compared to a net loss of $6.59 million for the year ended June 30, 2013. The Company's balance sheet at June 30, 2014, showed $16.64 million in total assets, $26.98 million in total liabilities, and a $10.34 million total stockholders' deficit. Friedman LLP, in East Hanover, New Jersey, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2014. The independent auditors noted that the Company's losses, negative cash flows from operations, working capital deficit, related party note in default payable upon demand and its ability to pay its outstanding liabilities through fiscal 2014 raise substantial doubt about its ability to continue as a going concern. GT ADVANCED: Governmental Units Have Until April 6 to File Claims ----------------------------------------------------------------- In the Chapter 11 cases of GT Advanced Technologies Inc., U.S. Bankruptcy Judge Henry J. Boroff entred an order providing that: 1. Apple Inc. and Platypus Development LLC (collectively, the Apple Parties) will not be required to file any proof of claim prior to the date that is 45 days after any termination of that certain adequate protection and settlement agreement, dated Oct. 21, 2014, among the Apple Parties and GTAT. In the event of a termination of the settlement agreement, if the Apple Parties do not file a proof of claim on account of any claims Apple may hold that arose on or prior to the Petition Date so that it is actually received on or before 5:00 p.m. on the Apple Bar Date, the Apple Parties will not be permitted to vote to accept or reject any plan filed in the chapter 11 cases, receive any distribution in the cases on account of the claim, or receive further notices regarding the claim. 2. All governmental units have until April 6, 2015, at 5:00 p.m., to file proofs of claim against GT Advanced Technologies, Inc. and GT Advanced Equipment Holding LLC. Proofs of claim must be submitted to: GTAT Claims Processing Center C/O KURTZMAN CARSON CONSULTANTS LLC 2335 Alaska Avenue El Segundo, CA 90245 About GT Advanced Technologies GT Advanced Technologies Inc. -- http://www.gtat.com/-- is a diversified technology company producing advanced materials and innovative crystal growth equipment for the global consumer electronics, power electronics, solar and LED industries. Headquartered in Merrimack, New Hampshire, GT is a publicly held corporation whose stock is traded on NASDAQ under the ticker symbol "GTAT." As of June 28, 2014, the GTAT Group's unaudited and consolidated financial statements reflected assets totaling $1.5 billion and liabilities totaling $1.3 billion. As of Sept. 29, 2014, GTAT had $85 million in cash, $84 million of which is unencumbered. On Oct. 6, 2014, GT Advanced Technologies and 8 affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code (Bankr. D.N.H. Lead Case No. 14-11916). GT says that it has sought bankruptcy protection due to a "severe liquidity crisis." The Debtors have tapped Nixon Peabody LLP and Paul Hastings LLP as attorneys and Kurtzman Carson Consultants LLC as claims and noticing agent. GT ADVANCED: To Unveal Secret Documents With Apple -------------------------------------------------- Felix Balthasar at Newsmaine.net reports that the Bankruptcy Judge Henry Boroff on Tuesday ordered Apple Inc. and GT Advanced Technologies Inc. to put the secret documents that describe the relationship between the two companies in public record by Nov. 7 at noon. According to Newsmaine.net, Judge Boroff made some exceptions, saying that a Master Development and Supply Agreement between Apple and GT Advanced will not be unsealed, as these documents contained "confidential commercial information." Vikas Shukla at Valuewalk.com relates that GT Advanced, which was valued at $3 billion in September 2014, almost vanished in October. GT Advanced's short interest dropped 36.4% -- from 61.16 million shares to 38.9 million shares -- between Sept. 30 and Oct. 15, according to Valuewalk.com. About GT Advanced Technologies GT Advanced Technologies Inc. -- http://www.gtat.com/-- is a diversified technology company producing advanced materials and innovative crystal growth equipment for the global consumer electronics, power electronics, solar and LED industries. Headquartered in Merrimack, New Hampshire, GT is a publicly held corporation whose stock is traded on NASDAQ under the ticker symbol "GTAT." As of June 28, 2014, the GTAT Group's unaudited and consolidated financial statements reflected assets totaling $1.5 billion and liabilities totaling $1.3 billion. As of Sept. 29, 2014, GTAT had $85 million in cash, $84 million of which is unencumbered. On Oct. 6, 2014, GT Advanced Technologies and 8 affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code (Bankr. D. N.H. Lead Case No. 14-11916). GT says that it has sought bankruptcy protection due to a "severe liquidity crisis." The Debtors have tapped Nixon Peabody LLP and Paul Hastings LLP as attorneys and Kurtzman Carson Consultants LLC as claims and noticing agent. GREEN BRICK: Completes Acquisition of JBGL for $275 Million ----------------------------------------------------------- Green Brick Partners, Inc., formerly known as BioFuel Energy Corp., has completed its previously announced acquisition of the equity interests of JBGL Builder Finance, LLC, and certain subsidiaries of JBGL Capital, LP, from certain affiliates of Greenlight Capital, Inc., and James R. Brickman. The purchase price for the Acquisition was $275 million, which consisted of approximately $191.8 million in cash with the remainder in 11,108,500 shares of Green Brick common stock valued at $7.49 per share pursuant to the terms of the Acquisition. After consummation of the Acquisition, Greenlight owns approximately 49.9% of the Company's outstanding common stock and James R. Brickman, along with certain family members and trusts affiliated with Mr. Brickman, owns approximately 8.4% of the Company?s outstanding common stock. In connection with the closing of the Acquisition, the Company consummated its previously announced rights offering which raised gross proceeds of $70 million and entered into a $150 million loan agreement with Greenlight. In connection with the Acquisition, the Company changed its name to Green Brick Partners, Inc., Green Brick's common stock will start trading on The Nasdaq Capital Market under the symbol, "GRBK," on Oct. 28, 2014. Also in connection with the closing, David Einhorn was appointed Chairman of the Board of Green Brick and James R. Brickman was appointed chief executive officer. "As a private company, we have developed a great lot position, superior operators, aligned management, and achieved strong financial results," stated Jim Brickman, chief executive officer. "We expect to become even stronger as a public company because we now have permanent capital, the ability to retain earnings tax efficiently and access to capital for future growth. In summary, we believe that our prospects have never been better." "We are very pleased to help transition BioFuel Energy, the former ethanol producer, into Green Brick Partners, a successful homebuilder," said David Einhorn, Chairman of the Board of Directors. "This deal is a win-win for everyone involved and creates an exciting platform for Green Brick's future growth." Additional information is available with the U.S. Securities and Exchange Commission at http://is.gd/65yiiM About Green Brick Denver, Colo.-based BioFuel Energy Corp., now known as Green Brick Partners, Inc., is an ethanol producer in the United States. Biofuel Energy incurred a net loss of $45.65 million in 2013, a net loss of $46.32 million in 2012 and a net loss of $10.36 million in 2011. The Company's balance sheet at Sept. 30, 2014, the Company had $8.83 million in total assets, $2.07 million in total liabilities, all current, and $6.75 million in total equity. GREEN BRICK: Third Point Reports 16.7% Equity Stake --------------------------------------------------- In an amended Schedule 13D filed with the U.S. Securities and Exchange Commission, Third Point LLC disclosed that as of Oct. 27, 2014, it beneficially owned 5,242,124 shares of common stock of Green Brick Partners, Inc. The Third Point Shares represent approximately 16.7% of the Common Stock, based upon the 31,346,084 shares of Common Stock outstanding as of Oct. 31, 2014, based on information provided by the Company. As of Oct. 27, 2014, Daniel S. Loeb beneficially owns 5,342,067 shares of Common Stock, representing approximately 17.0% of the Outstanding Shares; Third Point Partners beneficially owns 1,744,979 shares of Common Stock, representing approximately 5.6% of the Outstanding Shares; and Third Point Partners Qualified beneficially owns 1,105,845 shares of Common Stock, representing approximately 3.5% of the Outstanding Shares. A copy of the Schedule 13D/A is available for free at: http://is.gd/rr203I About Green Brick Denver, Colo.-based BioFuel Energy Corp., now known as Green Brick Partners, Inc., is an ethanol producer in the United States. In October 2014, Biofuel Energy had completed the acquisition of the equity interests of JBGL Builder Finance LLC and certain subsidiaries of JBGL Capital, LP, from Greenlight Capital and James Brickman. In relation to the acquisition, the Company changed its name to Green Brick Partners, Inc. Biofuel Energy incurred a net loss of $45.65 million in 2013, a net loss of $46.32 million in 2012 and a net loss of $10.36 million in 2011. The Company's balance sheet at Sept. 30, 2014, the Company had $8.83 million in total assets, $2.07 million in total liabilities, all current, and $6.75 million in total equity HAGOOD RESERVE: Cambridge Properties Starts Tearing Down Project ---------------------------------------------------------------- Will Boye at the Charlotte Business Journal reports that Cambridge Properties and Copper Builders have started tearing down the Hagood Reserve property at the corner of Carmel and Colony roads in preparation of a new 34-unit townhome development called Easton Park. Business Journal relates that two half-finished units from the Hagood Reserve project have been torn down. Wade Miller, who heads Copper Builders said that a large garage that was built for Hagood Reserve will also be razed soon, the report adds. According to Business Journal, Cambridge Properties and Copper Builders won a rezoning in July for the property, where Tuscan Development once planned the upscale condo and townhome development. Hagood Reserve, LLC, was organized in 2005 to acquire and develop a wooded, 9.2-acre parcel in South Charlotte. The project would include 36 luxury exclusive condominiums and townhomes in three separate buildings. Hagood Reserve LLC filed for Chapter 11 bankruptcy (Bankr. W.D.N.C. Case No. 10-30725) on March 17, 2010, interrupted a foreclosure proceeding by lender First Horizon against the condominium project, the Debtor's sole asset. Hagood Reserve estimated assets and debts ranging from $1 million to $10 million in its petition. At the Petition Date, the parties were also disputing which side breached that loan agreement in a state action entitled First Horizon Home Loans, a division of First Tennessee Bank National Association v. Hagood Reserve, LLC, et al., Case No. 09-CVS-15152, General Court of Justice, Superior Court Division, Mecklenburg County, North Carolina. HAMPDEN COUNTY PHYSICIANS: Wants Ch 11 Case Converted to Ch 7 ------------------------------------------------------------- Anne-Gerard Flynn at Masslive.com reports that Hampden County Physician Associates asked the Hon. Henry J. Boroff of the U.S. Bankruptcy Court for the District of Massachussets on Oct. 28, 2014, to convert its Chapter 11 reorganization case to one under Chapter 7 liquidation, which could leave some 50,000 patients without access to their health care provider. Masslive.com recalls that the Debtor, which is several million dollars in debt, filed for Chapter 11 bankruptcy protection on Oct. 2, 2014, but later filed a Chapter 7 motion, admitting that it does not expect to be able to meet payroll expenses beyond the end of October due to lower than anticipated revenues for that month, the departure of five doctors to form their own allergy practice, and "patients that can only pay for their services through the MassHealth / Medicaid programs." The Debtor said in its court filing that it believes that it has no alternative other than to stop business operations upon the close of business on Oct. 31. According to Masslive.com, the Debtor also asked for an "emergency consolidation of hearings" meeting, either Oct. 31 or Nov. 3, with 20 of its largest creditors, on related motions, that would allow two unnamed hospitals to "take over in a complementary way, substantially all of the Debtor's remaining business operation." Masslive.com relates that the Sisters of Providence Health System and Noble Hospital in Westfield have expressed interest in the Debtor's assets. Jim Kinney at Masslive.com reports that the Debtor has started closing down. Hampden County Physician Associates is a corporation that employs some 68 health care providers, 270 employees and serves some 50,000 patients. HDGM ADVISORY: Cayman Islands Funds Fret Over Less Cash ------------------------------------------------------- Greg Andrews at Ibj.com reports that Cayman Islands funds said in a filing in October that the HDG Mansur Investment Services, Inc. companies in bankruptcy have only about $10,000 in cash on hand, which is far less than the $220,000 Katz & Korin has so far billed for legal fees but not been paid. The Cayman Islands funds claimed in an August filing that HDG Mansur and Harold Garrison have improperly drained millions of dollars from insurance policies that might have gone toward paying what they are owed. According to Ibj.com, the Cayman Islands funds are angling for payment of their $5.8 million judgment in bankruptcy proceedings. Cayman Islands funds said that they are "highly concerned that continuation of these Chapter 11 cases will destroy any chance they may have had for a meaningful recovery of their claims," Ibj.com reports. About HDGM Advisory Services HDGM Advisory Services, LLC, and HDG Mansur Investment Services, Inc. sought Chapter 11 bankruptcy protection (Bankr. S.D. Ind. Case No. 14-04797 and 14-04798) in Indianapolis, Indiana, on May 21, 2014. On May 28, 2014, the Hon. James M. Carr directed the joint administration the cases of HDGM Advisory Services, LLC, and HDG Mansur Investment Services, Inc., under the lead case -- HDGM Advisory, Case No. 14-04797. HDGH Advisory disclosed $20,257,001 in assets and $7,991, 590 in liabilities as of the Chapter 11 filing. HDG Mansur disclosed $20,454,819 in assets and $12,377,542 in liabilities. According to a court filing, the Debtors don't have any secured creditors. The cases are assigned to Judge James M. Carr. The Debtors have tapped Michael W. Hile, Esq., Christine K. Jacobson, Esq., and Henry Mestetsky, Esq., at Katz & Korin PC, as counsel. An affiliate of the Debtors, Hamilton Proper Partners Golf Partnership, L.P., sought bankruptcy protection (Bankr. S.D. Ind. Case No. 14-00461) on Jan. 24, 2014. HERFF JONES: Moody's Puts 'B2' CFR on Review for Downgrade ---------------------------------------------------------- Moody's Investors Service placed Herff Jones, Inc.'s ratings, including its B2 corporate family rating, B3-PD probability of default rating, and B2 ratings on senior secured term loan and revolving credit facility under review for a possible downgrade. The rating action follows the company's announcement that it has entered into a definitive agreement to be acquired by Charlesbank Capital Partners (private equity firm) and Partners Group (private markets investment management firm). The transaction includes the businesses of Herff Jones, Varsity Spirit and BSN Sports, which generate approximately $1.2 billion in combined annual revenues. Moody's expects the acquisition to be financed with new debt. Senior management of the company will retain current positions and invest in the company. The company expects the acquisition to close in December 2014, subject to customary closing conditions. Rating Rationale The review will focus on the likely capital structure following the acquisition financing, and the financial policy and strategic objectives of the company's new private equity owners. The following ratings were placed under review for a possible downgrade: Issuer: Herff Jones, Inc B2 Corporate Family Rating; B3-PD Probability of Default Rating; B2 rating on $200 million Senior Secured Revolver due 2018; B2 rating on $525 million Senior Secured Term Loan due 2019. Should all the existing debt be repaid with proceeds from the transaction, the existing ratings will be withdrawn. The principal methodology used in these ratings was Consumer Durables Industry published in September 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. Herff Jones, Inc. is an employee-owned manufacturer and publisher of recognition rewards, graduation-related items and cheerleading products and services throughout the U.S. The company operates in four complimentary segments with a K-12 and collegiate school focus: cheerleading products and services (through its Varsity brand acquired in 2011), sports apparel and equipment (acquired with BSN in 2013), and the legacy Yearbook, and Scholastic (class rings, caps & gowns and graduation papers) segments. HOVNANIAN ENTERPRISES: Unit Selling $250 Million Senior Notes ------------------------------------------------------------- Hovnanian Enterprises, Inc.'s wholly-owned subsidiary, K. Hovnanian Enterprises, Inc., priced $250 million aggregate principal amount of 8.000% Senior Notes due 2019 in a private placement. The Notes will be guaranteed by the Company and substantially all of its subsidiaries. K. Hovnanian intends to use the net proceeds from the Notes Offering for general corporate purposes, including land acquisition and land development. The Notes have not been registered under the Securities Act of 1933, as amended. The Notes may not be offered or sold within the United States or to U.S. persons, except to "qualified institutional buyers" in reliance on the exemption from registration provided by Rule 144A and to certain persons in offshore transactions in reliance on Regulation S. About Hovnanian Enterprises Red Bank, New Jersey-based Hovnanian Enterprises, Inc. (NYSE: HOV) -- http://www.khov.com/-- founded in 1959 by Kevork S. Hovnanian, is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian Homes, Matzel & Mumford, Brighton Homes, Parkwood Builders, Town & Country Homes, Oster Homes and CraftBuilt Homes. As the developer of K. Hovnanian's Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes. Hovnanian Enterprises posted net income of $31.29 million on $1.85 billion of total revenues for the year ended Oct. 31, 2013, as compared with a net loss of $66.19 million on $1.48 billion of total revenues during the prior year. As of July 31, 2014, the Company had $1.89 billion in total assets, $2.33 billion in total liabilities and a $443.12 million total deficit. * * * As reported by the Troubled Company Reporter on April 25, 2013, Standard & Poor's Ratings Services said it raised its corporate credit rating on Hovnanian Enterprises Inc. to 'B-' from 'CCC+'. "The upgrade reflects strengthening operating performance supported by the broader recovery in the housing market that, we believe, should support modest profitability in 2013," said Standard & Poor's credit analyst George Skoufis. In the Dec. 9, 2013, edition of the TCR, Fitch Ratings upgraded the Issuer Default Rating (IDR) of Hovnanian Enterprises to 'B-' from 'CCC'. The upgrade and the Stable Outlook reflects HOV's operating performance year-to-date (YTD), adequate liquidity position, and moderately better prospects for the housing sector during the remainder of this year and in 2014. As reported by the TCR on Jan. 9, 2014, Moody's Investors Service raised the Corporate Family Rating of Hovnanian Enterprises, Inc., to B3 from Caa1. The upgrade of the Corporate Family Rating to B3 reflects Hovnanian's improved financial performance including improvement in interest coverage to slightly above 1x and finally turning net income positive for the fiscal year 2013. HRK HOLDINGS: Seeks to Extend Further Exclusivity Periods --------------------------------------------------------- HRK Holdings and HRK Industries LLC filed a motion with the Bankruptcy Court for a further extension of their exclusive plan filing period through and including Dec. 21, 2014. About HRK Holdings HRK Holdings and HRK Industries LLC filed for Chapter 11 protection (Bankr. M.D. Fla. Case Nos. 12-09868 and 12-09869) on June 27, 2012. Judge K. Rodney May oversees the case. Barbara A. Hart, Esq., and Scott A. Stichter, Esq., at Stichter, Riedel, Blain & Prosser, P.A., represents the Debtors. HRK Holdings disclosed $33,366,529 in assets and $26,092,559 in liabilities in its revised schedules. According to the Debtors, the bankruptcy filing was necessitated by the immediate need to sell a portion of the remaining property to create liquidity for (a) funding the urgent management of the site-related environmental concerns; the benefit of creditors; funding a litigation filed by the Debtors; and funding of expenses related to additional sales of the remaining property. HRK Holdings is selling real property assets to Allied Universal Corp. and Mayo Fertilizer, Inc. The Court allowed HRK and the purchasers to enter into any modifications to the agreements without need of further Court approval, provided that no amendments will occur without prior consent of Regions Bank. INERGETICS INC: James Kras Appointed as Director ------------------------------------------------ Carl Germano resigned as a director and executive officer of Inergetics, Inc., on Oct. 28, 2014, according to a regulatory filing with the U.S. Securities and Exchange Commission. On Oct. 30, 2014, the Company's Board of Directors appointed James Kras a director of the Company to fill the vacancy resulting from Mr. Germano's resignation. $165,000 Note Inergetics issued a convertible debenture in the principal amount of $165,000 to Macallan Partners, LLC, pursuant to which it borrowed $150,000. The additional $15,000 represents original issue discount. Principal is due and payable under the Debenture on Oct. 30, 2015. At the option of the Company, the principal may be prepaid before the due date at a premium of 130%. The Debenture provides that Macallan will not have the right to convert any portion of the Debenture, to the extent that after giving effect to that conversion, it would beneficially own in excess of 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to such conversion. About Inergetics Inc. Paramus, N.J.-based Inergetics, Inc., formerly Millennium Biotechnologies Group, Inc., is a holding company for its subsidiary Millennium Biotechnologies, Inc. Millennium is a research based bio-nutraceutical corporation involved in the field of nutritional science. Millennium's principal source of revenue is from sales of its nutraceutical supplements, Resurgex Select(R) and Resurgex Essential(TM) and Resurgex Essential Plus(TM) which serve as a nutritional support for immuno-compromised individuals undergoing medical treatment for chronic debilitating diseases. Millennium has developed Surgex for the sport nutritional market. The Company's efforts going forward will focus on sales of Surgex in powder, bar and ready to drink forms. The Company's balance sheet at June 30, 2014, showed $3.01 million in total assets, $12.68 million in total liabilities, $9.09 million in preferred stock and a stockholders' deficit of $18.76 million. The Company stated in its quarterly report for the period ended June 30, 2014, that "The Company's future success is dependent upon its ability to achieve profitable operations and generate cash from operating activities, and upon additional financing. Management believes they can raise the appropriate funds needed to support their business plan and develop an operating company which is cash flow positive. "However, the Company has a working capital deficit, significant debt outstanding, incurred substantial net losses for the six months ended June 30, 2014 and 2013 and has accumulated a deficit of approximately $91 million at June 30, 2014. The Company has not been able to generate sufficient cash from operating activities to fund its ongoing operations. There is no guarantee that the Company will be able to generate enough revenue and/or raise capital to support its operations. These factors raise substantial doubt about the Company's ability to continue as a going concern." INTERCORP RETAIL: Fitch Affirms 'BB' Issuer Default Rating ---------------------------------------------------------- Fitch Ratings has affirmed these ratings of Intercorp Retail Inc. as: Intercorp Retail -- Foreign currency Issuer Default Rating (IDR) 'BB'; -- Local currency IDR 'BB'. Intercorp Retail Trust (IRT) -- Foreign currency IDR 'BB'; -- USD300 million senior guaranteed notes due in 2018 'BB'. The company recently issued debt through InRetail Consumer, one of its fully-owned subsidiaries, and is in the process of buying back the ITR's USD300 million senior guaranteed notes due in 2018. After the full repayment of these notes, Fitch expects to withdraw the ratings of Intercorp Retail, ITR and its USD300 million senior guaranteed notes and will no longer follow the retail operations of Intercorp Retail. IRT, a fully owned subsidiary of Intercorp Retail, is a trust formed under the laws of the Cayman Islands solely to issue the guaranteed notes. The Rating Outlook is Stable. The ratings of these companies are linked through Fitch's parent and subsidiaries rating criteria. Intercorp Retail's ratings reflect its diversified business model, continued growing operations, and solid market position in Peru's supermarket, pharmacy retail, and real estate segments. Factors that constrain the rating are the company's adjusted net leverage and negative free cash flow trend due to significant capital expenditures plan being developed. The Stable Outlook for Intercorp Retail incorporates the view that the company's credit profile will remain stable during the next 12 month ended in June 2015. KEY RATING DRIVERS Fitch views Intercorp Retail's business position in the Peruvian retail industry as solid driven by a sound business strategy of developing and integrating several retail formats with its real estate operations to meet growing needs of Peruvian consumers. Intercorp Retail manages a leading multi-format retail operation in Peru, which primarily include Supermercados Peruanos, Eckerd Peru, the operator of the InkaFarma brand, and InRetail Real Estate. The company's business model of integrating retail operations with its shopping center platform allows attracting growing consumer traffic through its retail brands and locations, and enhances the company's ability to develop commercial sites and attract and develop adequate tenant mix. The supermarket chain is the second largest in Peru, with an estimated market share of 34% - based on revenues - as of June 30, 2014. The pharmacy chain is the largest in Peru, with a 53% market share in the formal segment. InRetail Real Estate is the leader in the Peruvian's shopping center industry with an expected market share of approximately 26% over the country's total gross leasable area (GLA) by the end of 2014. In addition, Intercorp Retail is also expanding retail operations in the department store, consumer finance and home improvement businesses, which are currently no material in terms of cash flow generation due to the stage of development of these businesses. The company margins are expected to remain stable. Intercorp Retail's achieved consolidated revenues and EBITDAR of S/. 6.8 billion and S/.635 million, respectively, during LTM June 30, 2014. This resulted in the company's EBITDAR margins of 9.3%, similar to those levels achieved during LTM ended in June 2013. Intercorp Retail's consolidated financial net leverage ratio, measured by the Total Adjusted Net Debt/ EBITDAR was 5.4x during the LTM June 30, 2014. The company's liquidity is viewed as adequate considering its capacity to maintain satisfactory coverage ratios and credit access. RATING SENSITIVITIES Negative Rating Actions: A rating downgrade could be triggered by a decline in the Peruvian macroeconomic environment affecting retail operations' cash flow generation, delays in the capex plan execution, and/or incremental debt associated with acquisition activity. Positive Rating Actions: Intercorp Retail' ratings could be positively affected by significant improvement in consolidated margins, leverage and liquidity above the levels incorporated in the ratings. IPC INT'L: Suit v. Milwaukee Golf Transferred to N.D. Illinois -------------------------------------------------------------- The U.S. District Court for the Northern District of Illinois will hear the adversary proceeding IPC International Corporation filed against Milwaukee Golf Shopping Center LLC and Milwaukee Golf Management Corporation. The lawsuit was originally filed in IPC's bankruptcy case pending in Wilmington, Delaware bankruptcy court. The defendants filed a motion to transfer the venue of the lawsuit or, in the alternative, for partial dismissal of the case. Bankruptcy Judge Mary F. Walrath, who presides over the Chapter 11 case, granted the Venue Transfer request, and did not rule on the dismissal request. Prior to the Petition Date, the Debtor entered into a Continuing Services Agreement with Milwaukee Golf Shopping Center LLC and Milwaukee Golf Management Corporation, under which the Debtor provided security services to the Defendants at the Golf Mill Shopping Center in Illinois. On April 25, 2014, the Debtor filed a Complaint against the Defendants seeking to recover certain accounts receivable from July to November of 2013, totaling $160,091.63. The Debtor asserts three causes of action: (1) turnover of debt under section 542(b) of the Bankruptcy Code, (2) breach of contract, and (3) unjust enrichment. On June 6, 2014, the Defendants filed a motion to transfer venue or for partial dismissal. The Defendants ask that the suit be transferred to the United States District Court for the Northern District of Illinois. (Id.) Alternatively, they request that Count III, unjust enrichment, be dismissed as to both parties, and/or that all Counts be dismissed as to Defendant Milwaukee Golf Management Corporation. The case is, IPC INTERNATIONAL CORPORATION, Plaintiff, v. MILWAUKEE GOLF SHOPPING CENTER LLC AND MILWAUKEE GOLF MANAGEMENT CORPORATION, Defendants, Adv. Proc. No. 14-50333 (MFW)(Bankr. D. Del.). A copy of Judge Walrath's November 3, 2014 Memorandum Opinion is available at http://bit.ly/1y0JIGkfrom Leagle.com. About IPC International Based in Bannockburn, Illinois, IPC International Corp., a provider of security services for 350 shopping malls, filed a petition for Chapter 11 protection (Bankr. D. Del. Case No. 13-12050) on Aug. 9, 2013, in Delaware after signing a contract for Universal Protection Services LLC to buy the business, subject to higher and better offers at an auction. Bankruptcy was the result of losses on a U.K. affiliate that was sold, as well as competition and the cost of liability insurance. Scott M. Strong signed the petition as chief financial officer. The Debtor estimated assets and debts of at least $10 million. Jeremy William Ryan, Esq., and Etta R. Mayers, Esq., at Potter Anderson & Corroon, LLP, serves as local counsel. Paul V. Possinger, Esq., and Brandon W. Levitan, Esq., at Proskauer Rose, LLP, serve as the Debtor's general bankruptcy counsel. Silverman Consulting, LLC, acts as the Debtor's financial advisor and Livingstone Partners, LLP, serves as the Debtor's investment banker. KCC is the Debtor's noticing, claims and balloting agent. Judge Mary F. Walrath presides over the case. The Debtor disclosed $21,959,100 in assets and $31,056,575 in liabilities as of the Chapter 11 filing. Liabilities include $6.9 million on a revolving credit and $10.4 million on term loans owing to PrivateBank & Trust Co., as agent. PrivateBank also provided a $12 million loan to finance the Chapter 11 case. The DIP loan required quick sale. A three-member panel has been appointed as the official unsecured creditors committee in the case. The panel consists of Weinberg, Wheeler, Hudgins, Gunn & Dial, LLC; Mary Carmona-Rousse; and Drew Eckl & Farnham, LLP. In October 2013, IPC International won authorization to sell the business for $25.4 million to Universal Protection Services. Allied Security Holdings LLC, a competing bidder, forced Universal to raise the offer at an auction early in October. Universal initially offered $21.3 million plus assumption of specified liabilities. IVANHOE RANCH: Nov. 13 Hearing on Settlement of Creditor Dispute ---------------------------------------------------------------- The U.S. Bankruptcy Court will convene a hearing on Nov. 13, 2014, at 11:00 a.m., to consider: i) approval of a compromise and settlement of Ivanhoe Ranch Partners LLC's dispute with creditor Essel Enterprises, LLC; and ii) conditional approval of the dismissal of the Chapter 11 case. In the Oct. 8 application, the Debtor related that the core dispute in the proceeding is the dispute among Essel, Ivanhoe and creditor Henry Gamboa for payment of the outstanding principal and interest on the loan of at least $8,365,000. The dispute was the trigger for the case, and also spawned the State Court Action, which has been pending for more than three years. While the Debtor asserts that it would prevail following a trial, and Essel makes the same claim, the dispute has been very expensive for all parties. On Oct. 1, all parties executed a final comprehensive settlement agreement and mutual general release and set of joint escrow instructions for the purpose of implementing the settlement. A summary of the settlement terms reflects that: 1. Essel has agreed to substantially discount its claim and accept payment of $5,000,000 in satisfaction provided it is paid in accordance with an agreed upon schedule and the other settlement terms are complied with by the Debtor and Gamboa. While payments are made per a schedule ($500,000 has already been paid), the final installment payment of $4,000,000 is due by Dec. 31, 2014. 2. Gamboa and the Debtor agree to pay Essel the settlement payment, or if not paid, to transfer to Essel all of the Debtor's right, title and interest in and to the Ivanhoe Ranch Property, the Willow Glen Property, other real property and related personal property. 3. The parties will open an escrow and deposit, among other documents, requests for reconveyance of the Deeds of Trust, the promissory note, some of the original Loan Documents, grant deeds and other transfer documents for the property. 4. If the settlement payment is timely made and the Debtor and Gamboa perform their other obligations, the reconveyances will be recorded by the Escrow holder; if the Settlement Payment is not made, the grant deeds will be recorded and the property transferred. 5. If Gamboa or the Debtor default in other pre-closing obligations (other than making the last Settlement Payment installment), Essel will retain other remedies, the loan will not be satisfied and Gamboa will remain obligated on the Gamboa Guaranty. About Ivanhoe Ranch Partners LLC Based in El Cajon, California, Ivanhoe Ranch Partners LLC aka Ivanhoe Development Corp. filed for Chapter 11 bankruptcy case (Bankr. S.D. Cal. Case No. 13-09397) on Sept. 23, 2013. Judge Laura S. Taylor presides over the Debtor's bankruptcy case. Kenneth C. Hoyt, Esq., at Hoyt Law Firm, represents the Debtor as counsel. The Debtor estimated assets between $10 million and $50 million and debts between $1 million and $10 million. On April 1, 2014, the Court entered an order granting relief from the automatic stay in favor of Essel Enterprises, LLC, the secured lender, with respect to the Debtor's key asset, which consists of a series of non-contiguous parcels of real property in rural east county, San Diego. Tiffany L. Carroll, the acting U.S. trustee, is seeking conversion of the Debtor's Chapter 11 case to a liquidation in Chapter 7, citing the Debtor's gross mismanagement and losses. JACKSONVILLE BANCORP: Robert Goldstein Named New Director --------------------------------------------------------- The Board of Directors of Jacksonville Bancorp, Inc., appointed Robert B. Goldstein as a new director on Oct. 28, 2014, according to a regulatory filing with the U.S. Securities and Exchange Commission. In connection with his appointment, the Board named Mr. Goldstein to serve on the Board's Organization and Compensation Committee, its Nominating and Corporate Governance Committee and its Executive Committee. Subject to regulatory approval, Mr. Goldstein will also serve as a director of the Company's wholly owned subsidiary, The Jacksonville Bank. Also on Oct. 28, 2014, John W. Rose delivered notice of his resignation as a director of the Company and the Bank, effective upon receipt of regulatory approval for Mr. Goldstein's directorship with the Bank. Mr. Goldstein is a principal of CapGen Financial Group and will replace Mr. Rose as one of the director designees of CapGen Capital Group IV LP, the Company's largest shareholder. As an affiliate of CapGen, Mr. Goldstein may be deemed to beneficially own shares owned by CapGen. Mr. Goldstein is also a direct holder of shares of the Company's common stock and nonvoting common stock, and a former debt holder pursuant to revolving loan agreements entered into with the Company in 2010 and 2011, which are further described in the Company's periodic reports filed with the SEC. In December 2012, Mr. Goldstein purchased 500 shares of the Series A preferred stock (which were later converted into 50,000 shares of nonvoting common stock) in the Company?s private placement offering, in consideration for his cancellation of $500,000 in outstanding debt of the Company--the entire amount outstanding under the Revolvers. After the December 2012 private placement, the Company did not borrow again under the Revolvers, and in the second quarter of 2013, Mr. Goldstein's commitments under the Revolvers were reduced to zero. The largest amount of principal outstanding under the Revolvers in 2012 was $500,000, and Mr. Goldstein earned $16,267 in interest in connection with the Revolvers in 2012. As previously reported in the Company?s SEC filings, on Aug. 26, 2014, the Board appointed A. Hugh Greene as a new director. At the time of his appointment, Mr. Greene had not yet been named to serve on any committees of the Board. On Oct. 28, 2014, the Board named Mr. Greene to serve on the Board's Audit Committee, its Organization and Compensation Committee and its Nominating and Corporate Governance Committee. About Jacksonville Bancorp Jacksonville Bancorp, Inc., a bank holding company, is the parent of The Jacksonville Bank, a Florida state-chartered bank focusing on the Northeast Florida market with eight full-service branches in Jacksonville, Duval County, Florida, as well as the Company's virtual branch. The Jacksonville Bank opened for business on May 28, 1999, and provides a variety of community banking services to businesses and individuals in Jacksonville, Florida. Jacksonville Bancorp reported a net loss available to common shareholders of $32.42 million in 2013, a net loss available to common shareholders of $43.04 million in 2012 and a net loss available to common shareholders of $24.05 million in 2011. As of June 30, 2014, the Company had $494.63 million in total assets, $459.11 million in total liabilities and $35.52 million in total shareholders' equity. KEMET CORP: Reports $6.3 Million Net Income in Second Quarter ------------------------------------------------------------- KEMET Corporation reported preliminary results for the Company's second quarter ended Sept. 30, 2014. KEMET reported net income of $6.33 million on $215.29 million of net sales for the quarter ended Sept. 30, 2014, compared to a net loss of $13.09 million on $208.44 million of net sales for the same period during the prior year. The Company's balance sheet at Sept. 30, 2014, showed $817.22 million in total assets, $602.38 million in total liabilities and $214.83 million in total stockholders' equity. "We are extremely pleased that the financial results for the quarter exceeded our expectations. Operating margins, influenced by our cost improvement actions and favorable product mix, improved 340 basis points compared to the prior quarter ended June 30, 2014, surpassing our forecast," stated Per Loof, KEMET's chief executive officer. "Operating margins will continue to be our primary focus for the company. Our expectation for our December 2014 quarter is an operating margin generally at or near the same level as this quarter," continued Loof. A copy of the press release is available for free at: http://is.gd/fKL4ge About KEMET KEMET, based in Greenville, South Carolina, is a manufacturer and supplier of passive electronic components, specializing in tantalum, multilayer ceramic, film, solid aluminum, electrolytic, and paper capacitors. KEMET's common stock is listed on the NYSE under the symbol "KEM." * * * As reported by the TCR on March 26, 2013, Moody's Investors Service downgraded KEMET Corp.'s Corporate Family Rating to Caa1 from B2 and the Probability of Default Rating to Caa1-PD from B2- PD based on Moody's expectation that KEMET's liquidity will be pressured by maturing liabilities and negative free cash flow due to the interest burden and continued operating losses at the Film and Electrolytic segment. As reported by the TCR on Aug. 9, 2013, Standard & Poor's Ratings Services lowered its corporate credit rating on Simpsonville, S.C.-based KEMET Corp. to 'B-' from 'B+'. "The downgrade is based on continued top-line and margin pressures and lagging results from the restructuring of the Film & Electrolytic [F&E] business, which combined with cyclical weak end-market demand, has resulted in sustained, elevated leverage well in excess of 5x, persistent negative FOCF, and diminishing liquidity," said Standard & Poor's credit analyst Alfred Bonfantini. The TCR reported in August 2014 that Standard & Poor's Ratings Services revised its outlook on Greenville, S.C.-based capacitor supplier KEMET Corp. to stable from negative. S&P affirmed the ratings, including the 'B-' corporate credit rating. KEMET CORP: Files Third Quarter Form 10-Q ----------------------------------------- KEMET Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q for the period ended Sept. 30, 2014. For the three months ended Sept. 30, 2014, the Company reported net income of $6.33 million on $215.29 million of net sales compared to a net loss of $13.09 million on $208.44 million of net sales for the quarter ended Sept. 30, 2013. The Company also reported net income of $2.79 million on $428.17 million of net sales for the six months ended Sept. 30, 2014, compared to a net loss of $48.23 million on $410.50 million of net sales for the same period last year. The Company's balance sheet at Sept. 30, 2014, showed $817.22 million in total assets, $602.38 million in total liabilities and $214.83 million in total stockholders' equity. A copy of the Form 10-Q is available for free at: http://is.gd/GRcKwR About KEMET KEMET, based in Greenville, South Carolina, is a manufacturer and supplier of passive electronic components, specializing in tantalum, multilayer ceramic, film, solid aluminum, electrolytic, and paper capacitors. KEMET's common stock is listed on the NYSE under the symbol "KEM." * * * As reported by the TCR on March 26, 2013, Moody's Investors Service downgraded KEMET Corp.'s Corporate Family Rating to Caa1 from B2 and the Probability of Default Rating to Caa1-PD from B2- PD based on Moody's expectation that KEMET's liquidity will be pressured by maturing liabilities and negative free cash flow due to the interest burden and continued operating losses at the Film and Electrolytic segment. As reported by the TCR on Aug. 9, 2013, Standard & Poor's Ratings Services lowered its corporate credit rating on Simpsonville, S.C.-based KEMET Corp. to 'B-' from 'B+'. "The downgrade is based on continued top-line and margin pressures and lagging results from the restructuring of the Film & Electrolytic [F&E] business, which combined with cyclical weak end-market demand, has resulted in sustained, elevated leverage well in excess of 5x, persistent negative FOCF, and diminishing liquidity," said Standard & Poor's credit analyst Alfred Bonfantini. The TCR reported in August 2014 that Standard & Poor's Ratings Services revised its outlook on Greenville, S.C.-based capacitor supplier KEMET Corp. to stable from negative. S&P affirmed the ratings, including the 'B-' corporate credit rating. LAKELAND INDUSTRIES: Completes $11.1 Million Private Placement -------------------------------------------------------------- Lakeland Industries, Inc., announced the closing of its private placement of common stock. Pursuant to the terms of the private placement, Lakeland sold an aggregate of 1,110,000 shares of common stock at a price of $10.00 per share. Proceeds from the financing were used to fully repay Lakeland's 12% subordinated term loan with LKL Investments, LLC, in the approximate amount of $3.6 million. The balance of the proceeds will be used for working capital and general corporate purposes, including supporting the increased demand for Lakeland's safety products due to the EBOLA crisis. Pending such usage, Lakeland intends to temporarily pay down a portion of its senior revolving credit facility with AloStar Bank of Commerce. Craig-Hallum Capital Group LLC acted as exclusive placement agent in connection with this offering. The shares of common stock sold in the private placement have not been registered under the Securities Act of 1933, as amended, or state securities laws and may not be offered or sold in the United States absent effective registration with the Securities and Exchange Commission (SEC) or an applicable exemption from such registration requirements. Lakeland is required to file a registration statement with the SEC registering the resale of the shares of common stock. Meanwhile, on Oct. 29, 2014, that certain Loan and Security Agreement, dated as of June 28, 2013, and the related agreements between Company and Junior Lender terminated upon the receipt by Junior Lender of a payoff amount of approximately $3.6 million from the Company. About Lakeland Industries Ronkonkoma, N.Y.-based Lakeland Industries, Inc., manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market. The Company reported a net loss of $26.3 million on $95.1 million of net sales for the year ended Jan. 31, 2013, as compared with a net loss of $376,825 on $96.3 million of sales for the year ended Jan. 31, 2012. The Company's balance sheet at July 31, 2014, showed $87.9 million in total assets, $40.9 million in total liabilities and $46.9 million in total stockholders' equity. In their report on the consolidated financial statements for the year ended Jan. 31, 2013, Warren Averett, LLC, in Birmingham, Alabama, expressed substantial doubt about Lakeland Industries' ability to continue as a going concern. The independent auditors noted that Company is in default on certain covenants of its loan agreements at Jan. 31, 2013. LEHMAN BROTHERS: Bankr. Court Disallows Former Employees' Claims ---------------------------------------------------------------- Judge Shelley C. Chapman of the U.S. Bankruptcy Court for the Southern District of New York issued a memorandum decision on Nov. 3, 2014, sustaining Lehman Brothers Holdings Inc.'s objections to claims filed by more than 200 of its former employees, after concluding that the former employees have failed to meet the burden imposed upon them to prove that their claims should be allowed as filed. The former employees, as a component of their compensation, received either restricted stock units ("RSU") or contingent stock awards. These awards gave employees a contingent right to own Lehman common stock, which would be issued five years after the grant of the applicable award upon the fulfillment of certain employment-related conditions. The employee-claimants filed their proofs of claim so they would be allowed in a cash amount equivalent to the amount of respective stock awards. Lehman submitted that the claims, all of which arise from the voluntary exchange of labor for the right to receive stock, should be classified as equity under its confirmed Modified Third Amended Joint Chapter 11 Plan. Judge Chapman stated: "The RSU Claimants have failed to identify any characteristics that distinguish the RSU Claims from the employee claims at issue in Enron... (i) the RSUs are securities; (ii) that the RSU Claimants purchased when they willingly engaged in the exchange of their labor for the RSUs; and (iii) the damages that the RSU Claimants seek arise from such purchase. As such, the RSU Claims must be subordinated under section 510(b) of the Bankruptcy Code. In the alternative, the RSUs at issue fall within the definition of "equity security" under section 101(16) of the Bankruptcy Code, and, accordingly, the RSU Claimants do not assert a "claim" under section 101(5) of the Bankruptcy Code." A full-text copy of Judge Chapman's Decision is available at http://is.gd/CE6aIHfrom Leagle.com. 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 Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed 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. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. 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. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch 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 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. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. The Chapter 11 plan for the Lehman companies other than the broker was confirmed in December 2011. Lehman made its first payment of $22.5 billion to creditors in April 2012 and a second payment of $10.2 billion on Oct. 1. A third distribution is set for around March 30, 2013. The brokerage is yet to make a first distribution to non-customers. 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. LEHMAN BROTHERS: Trustee Mulls Wind-Down of Bankruptcy Estate ------------------------------------------------------------- Lehman Brothers Securities N.V. on Nov. 6 disclosed that Michiel Gorsira (the "LBS Trustee"), in his capacity as bankruptcy trustee (curator), is considering winding down the LBS estate and making a final distribution to creditors in the first quarter of 2015. The wind down process, which will require approval from the supervisory judge overseeing LBS's bankruptcy proceedings, would be expected to include a combination of an in kind distribution of at least 85% of LBS's intercompany claims against Lehman Brothers Holdings Inc. and Lehman Brothers International Europe, and the sale for cash of the remaining portion of those claims and any remaining assets with a corresponding distribution of the proceeds to creditors. The LBS Trustee intends to solicit proposals from certain market participants to help facilitate the wind down. No assurances can be made that such a wind down will in fact occur in the first quarter of 2015 or at any particular time thereafter, or of the assets that may be distributed in kind in the wind down, or of the amount of cash proceeds that may be received by creditors in the wind down. 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 Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed 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. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. 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. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch 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 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. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. The Chapter 11 plan for the Lehman companies other than the broker was confirmed in December 2011. Lehman made its first payment of $22.5 billion to creditors in April 2012 and a second payment of $10.2 billion on Oct. 1. A third distribution is set for around March 30, 2013. The brokerage is yet to make a first distribution to non-customers. 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. LEVEL 3: S&P Raises Corp. Credit Rating to 'BB-'; Outlook Stable ---------------------------------------------------------------- Standard & Poor's Ratings Services said it raised its corporate credit rating on Broomfield, Colo.-based Level 3 Communications (Level 3) to 'BB-' from 'B+' and removed the rating from CreditWatch, where S&P had placed it with positive implications on June 16, 2014. The outlook is stable. At the same time, S&P raised the issue-level rating on Level 3's unsecured debt to 'B' from 'B-' and removed it from CreditWatch, where S&P had placed it with positive implications on June 16, 2014. In addition, S&P affirmed the 'B' issue rating on the unsecured debt issued by Level 3's subsidiary, Level 3 Escrow II Inc., which was issued to partly fund the TW Telecom acquisition. The recovery ratings on all unsecured debt remain '6' indicating S&P's expectation for "negligible" (0% to 10%) recovery for unsecured debtholders in the event of default. Total reported debt, pro forma for the acquisition, is approximately $11 billion. "The rating upgrade reflects our view that the TW Telecom acquisition modestly improves Level 3's business risk profile without having a material impact on financial metrics," said Standard & Poor's credit analyst Richard Siderman. "We have revised our assessment of business risk to "fair" from "weak" since the TW Telecom assets will deepen Level 3's reach into metropolitan markets and enable Level 3 to carry more traffic on-network. The TW Telecom acquisition will also boost the portion of Level 3 revenues that are generated by enterprise core network services (CNS) customers. We view enterprise CNS as Level 3's most defensible and stable segment and one that is less susceptible to price compression compared to Level's wholesale CNS services and its commodity-like wholesale voice segment," S&P noted. The stable outlook reflects the increasing portion of revenue from enterprise CNS services that favorably affects Level 3's revenue and EBITDA visibility. The stable outlook also incorporates S&P's expectation that growth in CNS revenue from Level 3 legacy operations and from the acquired TW Telecom assets will more than offset continuing erosion in the wholesale voice segment resulting in low-single-digit revenue growth in 2015. S&P expects debt to EBITDA in the low- to mid-4x area and FFO to debt in the mid-teens percentage area in 2015, which includes a full year of TW Telecom operations. Both of these metrics are consistent with "aggressive" financial risk and, along with "adequate" liquidity, support the rating. S&P do not anticipate material improvement in credit quality over the next year since S&P expects 2015 to be a period of integration for the TW Telecom acquisition. Further, realization of material network and other operating synergies from TW Telecom will take some time to be realized and S&P do not anticipate material synergies from the TW Telecom acquisition, net of integration expenses, during 2015. S&P could lower the rating if already intense competition heightens; in particular, if the company experiences sustained greater-than-anticipated price compression for CNS services. Under such a scenario, S&P could lower the rating if sustained pricing pressure depresses the adjusted EBITDA margin toward 30% and results in leverage increasing to the 5x area. Another path to a downgrade could come from unexpected, material missteps in integrating the TW Telecom assets. LINCOLN PARK: S&P Affirms 'BB' Rating on 2010 GOLT Bonds -------------------------------------------------------- Standard & Poor's Ratings Services removed its underlying rating (SPUR) on Lincoln Park, Mich.'s series 2010 general obligation (GO) limited-tax bonds from CreditWatch, where it was placed with negative implications on Aug. 5, 2014, and affirmed the rating at 'BB'. The outlook has been revised to stable. The rating was previously placed on CreditWatch negative, reflecting S&P's view of a large and growing structural imbalance because of a larger-than-previously anticipated general fund deficit for fiscal 2014 and additional budgeted deficits in fiscal 2015. "The CreditWatch action reflects our view of an emergency financial and operating plan that the appointed emergency manager has submitted to the state to regain structural balance by 2016 and improve the city's overall long-term financial condition," said Standard & Poor's credit analyst Oladunni Ososami. "We believe that the plan is sufficient to maintain the rating." LONESTAR GENERATION: S&P Affirms 'BB-' Rating on Upsized Term Loan ------------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its 'BB-' rating and '1' recovery to Lonestar Generation LLC's $515 million senior secured term loan B, which would increase to $675 million with a successful amendment, and $50 million senior secured revolving credit facility. The '1' recovery indicates high (90% to 100%) recovery under a default scenario. On a successful amendment, the portfolio will consist of three combined-cycle gas turbine facilities (Bastrop, Frontera, and Paris) totaling 1,295 MW in the north and south regions of the Electric Reliability Council of Texas (ERCOT) market, the 310 MW Twin oaks coal plant, and the adjacent Walnut Creek mine. Through Feb. 2017, the gas-fired facilities will sell 100% of their capacity under heat rate call option agreements to Energy America LLC, a division of Direct Energy, and will be supported by a parent guarantee from Centrica. Twin Oaks will sell its output into the ERCOT market on a merchant basis. With the amended term loan B, and the inclusion of the two assets, Lonestar Generation will have about $290 million of equity in the project. The outlook is stable. Relatively small portfolios of this type typically have a rating no higher than 'BB'. Despite additional volatility added to the portfolio from merchant coal fired gross margins, the majority of the gross margins during the initial three-year period still accrue from the toll. "We expect relatively stable performance, and that the project will be able to meet its projected financial measures," said Standard & Poor's credit analyst Aneesh Prabhu. An upgrade, which S&P will not consider until 2017, could occur if operational performance through the forecast period enables deleveraging of the portfolio by 20%, and there is visibility into merchant pricing that will likely to support DSCR levels of about 3x to 3.2x Conversely, a downgrade could occur if operational issues emerge that result in DSCRs declining to 1.6x. In the fully merchant period, S&P could lower ratings if DSCR levels are below 2x, and/or debt pay-down lags, and S&P expects refinancing leverage levels to be above $250 per kilowatt. LUKEN COMMUNICATIONS: Ends Equity Comms Fight, To Exit Ch. 11 ------------------------------------------------------------- Dave Flessner, writing for Timesfreepress.com, reports that Luken Communications LLC is emerging from Chapter 11 bankruptcy after settling in October a lawsuit filed by a bankruptcy trustee over claims that the company had underpaid for the TV programs and assets held by Equity Communications. Henry Luken started Luken Communications in 2008 when he acquired the assets of bankrupt Equity Communications in Little Rock for $18.5 million. Timesfreepress.com recalls that Luken Communications filed for bankruptcy in 2013 after a jury sided with the bankruptcy trustee and ordered Luken Communications to pay $65.9 million on costs and damages, a verdict that the company appealed. The two parties later agreed on a $2 million settlement instead, the report says. Timesfreepress.com relates that outstanding claims have been paid and that Luken Communications attorneys have filed final motions to exit the bankruptcy reorganization. About Luken Communications Luken Communications, LLC, filed a bare-bones Chapter 11 petition (Bankr. E.D. Tenn. Case No. 13-13069) on June 23, 2013, in Chattanooga, Tennessee. The Debtor estimated at least $10 million in assets and liabilities. Henry G. Luken, III, as managing member, signed the petition. Judge John C. Cook presides over the case. Luken Communications sought Chapter 11 bankruptcy protection after founder Henry Luken was slapped with a $47.4 million civil verdict Friday in a lawsuit involving another bankrupt company, Equity Media Holdings Corp. Mr. Luken was the former chairman and CEO of Equity Media. Equity Media Holdings Corp., which operated 121 television stations including 23 full power, 38 Class A and 60 low power stations, filed for Chapter 11 protection on Dec. 8, 2008 (Bankr. E. D. Ark. Case No. 08-17646). In June 2010, Bankruptcy Judge James G. Mixon approved Equity Media's motion to convert its Chapter 11 case to a chapter 7 liquidation. M. Randy Rice was named Chapter 7 bankruptcy trustee. In its schedules, Luken Communications disclosed $6,020,105 in total assets and $83,312,128 in total liabilities. MAMMOTH RESOURCE: Judge to Decide Fate of Company's Bankruptcy -------------------------------------------------------------- The Associated Press reported that U.S. Bankruptcy Judge Joan Lloyd in Louisville, Kentucky, is set to decide whether to close out the case of Mammoth Resource Partners after the company's trustee, Robert Leasure, filed documents saying there is no workable plan to bring the company out of bankruptcy as a still functioning business. Cave City, Kentucky-based Mammoth Resource Partners, Inc., filed for Chapter 11 bankruptcy (Bankr. W.D. Ky. Case No. 10-11377) on Sept. 8, 2010. Judge Joan A. Lloyd presides over the case. David M. Cantor, Esq., at Seiller Waterman LLC, serves as the Debtor's counsel. In its petition, the Debtor estimated $1 million to $10 million in assets and $100,001 to $500,000 in debts. A list of the Company's 20 largest unsecured creditors filed together with the petition is available for free at http://bankrupt.com/misc/kywb10-11377.pdf The petition was signed by Roger L. Cory, CEO. MARION ENERGY: Secured Lender Objects to DIP Financing Request -------------------------------------------------------------- TCS II Funding Solutions, LLC, and Castlelake, L.P., object to the Marion Energy Inc.'s request for authority to obtain debtor-in- possession financing by KM Custodians Pty Ltd., insofar as the Debtor proposes to grant KM a "priming" lien on the Debtor's assets, ahead of TCS II's liens on those assets. TCS II, which holds a senior secured loan to Marion totaling in excess of $34 million, argues that the Chapter 11 case "does not propose a true reorganization for the benefit of unsecured creditors, but simply a delay of a specifically-negotiated sale process proposed by the Marion Parties in an effort to enhance Marion Energy Limited's and KM's recovery from the sale of Marion's interests in the Clear Creek Field. There was no need for Marion to commence the case or to propose a priming DIP financing." If, notwithstanding the Motion's various critical defects, the Court were to approve the DIP Motion and grant KM a priming lien, TCS II asserts that the Court should strictly limit the amount of the DIP Financing used by the Debtor prior to the final hearing on the Motion. TCS II further asserts that if the DIP Financing is allowed to prime TCS II, the Debtor's use of funds that prime TCS II should be limited to those costs and expenses that are essential to the operation of the Debtor's business. TCS II is represented by: Mark E. Hindley, Esq. Bria L. Mertens, Esq. David B. Levant, Esq. STOEL RIVES LLP Suite 1100, One Utah Center 201 South Main Street Salt Lake City, UT 84111 Tel: (801) 328-3131 Fax: (801) 578-6999 E-mail: mark.hindley@stoel.com bria.mertens@stoel.com david.levant@stoel.com About Marion Energy Marion Energy Inc. is a Texas corporation engaged in exploration and production of natural gas in the State of Utah. Marion's core operation is a producing gas field located in Carbon and Emery Counties, Utah (the "Clear Creek Field"). The company also holds smaller, currently unproductive acreage positions in the Helper and Roan Cliffs area near Helper, Utah (the "Helper Field"). Its parent is Australia-based Marion Energy Limited (ASX:MAE). Marion Energy Limited -- http://www.marionenergy.com.au/--is principally engaged in investment in oil and gas projects and the identification and assessment of new opportunities in the oil and gas industry in Texas, Utah and Oklahoma in the United States of America. Marion Energy Inc. sought Chapter 11 bankruptcy protection (Bankr. D. Utah Case No. 14-31632) in Salt Lake City, Utah on Oct. 31, 2014. The Debtor estimated assets and debt of $100 million to $500 million. The Debtor has tapped Parsons Behle & Latimer as attorneys. MAVERICK INT'L: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Maverick Int'l, Inc. 142 S Cardigan Way Suite B Mooresville, NC 28117 Case No.: 14-50805 Chapter 11 Petition Date: November 5, 2014 Court: United States Bankruptcy Court Western District of North Carolina (Statesville) Judge: Hon. Laura T. Beyer Debtor's Counsel: James H. Henderson, Esq. JAMES H. HENDERSON, P.C. 1201 Harding Place Charlotte, NC 28204-2248 Tel: 704.333.3444 Fax: 704.333.5003 Email: henderson@title11.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Phillip Winfield, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/ncwb14-50805.pdf MEDSOLUTIONS HOLDINGS: Moody's Affirms B2 Corporate Family Rating ----------------------------------------------------------------- Moody's Investors Service affirmed MedSolutions Holdings, Inc.'s B2 Corporate Family Rating (CFR), B2-PD Probability of Default Rating (PDR), and B2 rating on the company's existing senior secured first lien credit facilities. The rating outlook is stable. This action follows the company's definitive agreement to be acquired by CareCore National, LLC and financial sponsor General Atlantic LLC. In connection with the acquisition, MedSolutions' shareholders will take equity in CareCore and have a minority ownership with CareCore shareholders retaining majority ownership. The transaction is subject to customary regulatory approvals and is expected to close during the fourth quarter of 2014. Given the change of control language embedded in MedSolutions' credit agreement, Moody's expect all of MedSolutions' existing debt to be repaid upon close (consisting of a $300 million senior secured term loan due 2019 and $75 million senior secured revolver due 2018). Under such a scenario, Moody's would subsequently withdraw MedSolutions' CFR, PDR, and instrument ratings. For more information, please refer to Moody's rating withdrawal policy on moodys.com. MedSolutions Holdings, Inc.: Ratings affirmed: B2 Corporate Family Rating B2-PD Probability of Default Rating Senior secured first lien credit facilities, at B2 (LGD 3) The rating outlook is stable. Ratings Rationale Excluding the pending acquisition by CareCore, MedSolutions' current B2 Corporate Family Rating reflects the company's very high revenue concentration among its top customers and products, considerable financial leverage, and aggressive shareholder- friendly financial policies. The rating also reflect MedSolutions' material exposure to near-term contract expirations, although Moody's notes that the contract with the company's top customer has recently been extended through the end of 2019. The ratings are supported by the company's strong market position, solid customer relationships, strong client retention rates, lack of direct reimbursement risk, and favorable fundamentals and macro trends within the specialty benefit management market. The stable rating reflects Moody's expectation that the company will exhibit improved financial leverage and cash flow to debt metrics over the next 12 to 18 months. The stable outlook also reflects Moody's assumption that the company will successfully renew its contracts with its largest customers without a significant negative pricing impact, and that the company will not engage in additional debt-financed shareholder initiatives. An upgrade is not expected over the near-term due to the company's aggressive financial policy and high customer and product concentration. However, the ratings could be upgraded over time if the company achieves good customer diversity via new contact wins or expansion of services with existing customers. In addition, adjusted debt to EBITDA would need to be sustained below 3.0 times on a Moody's adjusted basis. The ratings could be downgraded if there is a material contraction in the level of operating cash flow, such that free cash flow turns negative, or if the company's liquidity deteriorates. In addition, Moody's could downgrade the ratings if the company is unable to successfully renew any of its contracts with key customers. From a financial metrics perspective, the ratings could be downgraded if adjusted debt to EBITDA is sustained above 4.5 times on a Moody's adjusted basis The principal methodology used in these ratings was the Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Franklin, Tennessee, MedSolutions Holdings, Inc., through its subsidiary MedSolutions, Inc. ("MedSolutions") is a leading specialty benefit management company. MedSolutions provides medical cost management services through proprietary programs aimed at reducing costs and improving quality of care in diagnostic imaging, musculoskeletal, post-acute, and other areas of healthcare. Clients consist primarily of health benefit plan sponsors including health maintenance organizations, health insurers, state government agencies, and other managed care organizations. The company is privately owned by TA Associates, MedCare, Ridgemont Equity Partners, management, employees, and other investors. For the twelve months ended September 30, 2014, the company generated revenues of approximately $903 million. MICHAEL DILWORTH: Hudson Americas Loses Bid to Lift Stay -------------------------------------------------------- District Judge J.P. Stadtmueller declined Hudson Americas LLC's invitation to reverse the decision by Bankruptcy Judge Pamela Pepper denying Hudson's request for relief from the automatic stay in the Chapter 11 case of Michael Dilworth. Judge Pepper heard that motion on February 18, 2014, and rendered a decision denying the motion a day later. Mr. Dilworth is (or was) the controlling member of various limited liability companies. Those LLCs entered into various transactions with Hudson to finance the acquisition of residential real estate properties. Mr. Dilworth also personally guaranteed the obligations assumed by the LLCs in those transactions. At one point, the total loan obligations related to Mr. Dilworth's properties approached $100,000,000, but through payments and negotiations approximately one-fifth of that amount remained in June 2013. Negotiations fell through on Mr. Dilworth's attempt to obtain a long-term renewal on that remaining amount, and he could not otherwise refinance or sell the properties. Shortly after coordinating the transfer of the equity-less properties to himself, Mr. Dilworth filed for Chapter 11 bankruptcy protection. He filed disclosure statements as part of his bankruptcy case; his disclosures make clear that Hudson has claims against him of more than $20,000,000. He proposed to pay the secured portion of that debt (approximately $16,500,000) at a rate of 4.5% over 25 years, with other terms. As to the remainder, he proposed to pay a pro-rata share of $25,000. Meanwhile, Mr. Dilworth continued to draw a salary of $5,000 from Ener-Con Companies, Inc., which manages the properties held by Mr. Dilworth's LLCs. That $5,000 monthly salary, though, does not start to cover Mr. Dilworth's stated monthly expenses of approximately $30,000, comprised of a mortgage of, among other things, approximately $18,500 per month; monthly recreation expenses of $2,750 per month; and monthly lawn maintenance/snow plowing fees of $1,650. Mr. Dilworth anticipates making up that shortfall by drawing on non-exempt investment assets. According to Judge Stadtmueller, "The Court is unable to conclude that Judge Pepper's decision was in error. Perhaps Mr. Dilworth's plan will ultimately prove unconfirmable, but that is a decision for Judge Pepper to make at the confirmation hearing. Her decision not to lift the stay turned on other standards, none of which the Court finds were in error. Therefore, the Court must affirm Judge Pepper's decision." The case is, WELLS FARGO BANK NA, acting by and through Hudson Americas, LLC, its attorney-in-fact, Appellant, v. MICHAEL H. DILWORTH, Appellee, Case No. 14-CV-375-JPS (E.D. Wis.). A copy of the District Court's Oct. 15 Order is available at http://bit.ly/10pWAujfrom Leagle.com. MILK SPECIALTIES: Moody's Lowers Corporate Family Rating to Caa1 ---------------------------------------------------------------- Moody's Investors Service downgraded Milk Specialties Company's Corporate Family Rating (CFR) to Caa1 from B3 and the company's Probability of Default Rating (PDR) to Caa2-PD from Caa1-PD. At the same time, Moody's downgraded the company's senior secured credit facilities, which include a $250 million principle senior secured term loan and a $35 million revolving credit facility, to Caa1 from B3. The rating outlook has also been changed to negative from stable. The downgrade is primarily driven by the company's weak liquidity profile, which has recently been impacted by a breach in covenants due to the inability to file financial statement by deadlines prescribed under terms of its credit facilities, a substantial decline in operating profits, as well as Moody's belief that leverage will remain high for the foreseeable future. The negative outlook reflects the uncertainty surrounding the company's ability to comply with covenants by filing financial statement in a timely manner, and the restoration of liquidity to levels appropriate for operations in a highly cyclical industry. The following ratings have been downgraded: Corporate Family Rating (CFR) to Caa1 from B3; Probability of Default Rating (PDR) to Caa2-PD from Caa1-PD; $35 million senior secured revolving credit facility due 2017 to Caa1 (LGD3) from B3 (LGD3); $250 million senior secured first lien term loan due 2018 to Caa1 (LGD3) from B3 (LGD3). The outlook is changed to negative Ratings Rationale The downgrade of the CFR to Caa1 primarily reflects recent weakening in Milk Specialties' liquidity profile, which was materially impacted by problems stemming from irregularities that the company had discovered in inventory accounting at one of its plants. This has caused the company to breach a covenant prescribed under terms of its credit facilities that require the company to submit audited financials to lenders within 120 days of the completion of the company's fiscal year end (June 28, 2014). As a result, the company does not have the ability to make incremental draws on its revolving credit facility pending resolution of a technical default of its covenants. The company is currently seeking a waiver of this covenant until early 2015. Failure to file audited financial covenants by then, or subsequent breach of financial covenants would likely place additional downward pressure on the ratings. Ratings are also constrained by high leverage and recent deterioration in profitability. Although Milk Specialties top-line has continued to grow at a healthy pace driven by solid end-user demand for the company's products, margins remain challenged because of relatively high input costs (primarily WPC34). Moody's notes that input costs have eased since the beginning of calendar 2014 raising prospects for a modest improvement trend in margins. Nonetheless, leverage as measured by Moody's adjusted debt-to- EBITDA based on preliminary financial results remains high at approximately 5.6 times at October 25, 2014, up from 4.1 times at fiscal year end June 2013. Milk Specialties' rating also considers the company's narrow product focus within the niche human and animal nutrition segments, small though improving scale, and cash flow that is expected to improve over time after having been constrained by large capital investments that Moody's understand are largely behind the company. The rating benefits from the company's leadership position as an independent processor of whey protein in the US, good customer diversification and a growing network of independent whey stream suppliers. During the last few years, the company has benefited from growing demand for whey in the sports nutrition and health and wellness markets and its commitment to expanding its manufacturing footprint and capacity, two trends Moody's expect to continue over the next 12 to 18 months. The negative outlook reflects risks surrounding the timing and consequences of any resolution to the breach in covenants and the delay in delivery of audited financial reports. In particular, Moody's is concerned that the resolution of the accounting issue may result in an adverse restatement of the company's earnings, as recent profitability may have been overstated as a result of improper treatment of inventory. This may have further liquidity implications with respect to compliance with financial maintenance covenants, including interest coverage and financial leverage, following resolution of the accounting situation. The ratings could be downgraded if liquidity deteriorates further and cash becomes more limited. In addition, prolonged negative free cash flow generation or leverage that climbs above 6.5 times could result in a negative rating action. A downgrade would also occur if the company is unable to obtain a waiver and defaults on its credit agreement. The ratings are unlikely to be upgraded in the near term. However, the ratings outlook could be stabilized if Milk Specialties is able to finalize its FY14 audited financial statements and resolve the associated covenant compliance and accounting issues. Over the long term, the ratings could be upgraded if the company strengthens its internal controls and improves operating performance such that leverage averages below 5.5 times through the cycle. In addition, the company would need to maintain an adequate liquidity profile, highlighted by ample access to its revolver and the ability to generate positive free cash flow on an annual basis. The principal methodology used in this rating was the Global Protein and Agriculture Industry published in May 2013. Other methodologies used include Loss Given Default for Speculative- Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Milk Specialties Company (Milk Specialties) is a leading independent manufacturer of whey and specialty dairy protein ingredients for the sports nutrition, health and wellness, food manufacturing and animal nutrition end markets. Milk Specialties was acquired by Kainos Capital (formerly HM Capital Partners LLC) in December 2011. Based on preliminary unaudited financial data, revenues for the twelve months ending October 25, 2014 were approximately $763 million. MINT LEASING: Plans to Buy 100% of MotorMax for $30 Million ----------------------------------------------------------- The Mint Leasing, Inc., entered into a First Amendment to and Assignment of Letter of Intent, pursuant to which Investment Capital Fund Group, LLC, a wholly-owned subsidiary of Sunset Brands, Inc., assigned all of its rights to Mint Leasing under a letter of intent between Sunset and the shareholders of Motors Acceptance Corporation, MotorMax Financial Services Corporation and MotorMax Auto Group, Inc., as disclosed with the U.S. Securities and Exchange Commission. Pursuant to the Letter of Intent, as amended by the Assignment, Mint Leasing agreed to pay a total of $30 million to the owners of MotorMax in consideration for 100% of MotorMax, of which $25 million (subject to net capital adjustments at closing) is payable in cash and $5 million is payable in stock; the Company agreed to provide proof of ability to raise the $25 million in cash by Dec. 15, 2014; and agreed to close the transactions contemplated by the Letter of Intent, including the Company's entry into a formal Securities Purchase Agreement with the owners of MotorMax, prior to Jan. 15, 2015 (provided that MotorMax is required to maintain exclusivity with the Company through that date). The cash consideration payable in connection with the acquisition will be used to repay certain obligations of MotorMax other than certain credit facilities which will be assumed by the Company. The closing of the transactions contemplated by the Letter of Intent are subject to among other things, the Company and the owners of MotorMax negotiating a mutually acceptable Securities Purchase Agreement, the Company's due diligence, the Company raising adequate funding to complete the transaction, which may not be available on favorable terms, if at all, and the approval of the acquisition by the Company's senior lender. Sunset, which assigned the Company its rights under the Letter of Intent, was previously the owner of Investment Capital Fund Group, LLC Series 20, a Delaware limited liability company, organized as a Delaware Series Business Unit, which held various gem assets which we acquired pursuant to a Share Exchange Agreement in consideration for 62,678,872 shares of the Company's restricted common stock on Sept. 23, 2014. MotorMax is a direct subprime automotive finance company located in Columbus, Georgia, with a 40 year history in consumer finance. MotorMax is currently originating approximately 1,200-1,500 automotive retail contracts per month. MotorMax consists of (1) a finance company (Motors Acceptance Corporation) which underwrites, finances and services all of the directly originated loans; (2) retail operations (MotorMax Auto Group, Inc.), which has sales operations in Georgia and Alabama where it operates nine dealerships; and (3) a consumer finance company (MotorMax Financial Services Corporation) licensed in Georgia, Alabama, South Carolina and Missouri. KBM Worldwide, Inc. Convertible Note Amendment On July 9, 2014, the Company sold KBM Worldwide, Inc., a Convertible Promissory Note in the principal amount of $158,500, pursuant to a Securities Purchase Agreement, dated the same day. The Convertible Note bears interest at the rate of 8% per annum (22% upon an event of default) and is due and payable on April 15, 2015. All or any portion of the principal amount of the Convertible Note and all accrued interest is convertible at the option of the holder thereof into the Company's common stock at any time following the 180th day after the Convertible Note was issued. The conversion price of the Convertible Note is equal to the greater of (a) $0.00005 per share, and (b) 61% multiplied by the average of the three lowest trading prices of the Company's common stock on the ten trading days before any conversion (representing a discount of 39%). The conversion price is also subject to dilutive protection as provided in the Convertible Note. At no time may the Convertible Note be converted into shares of common stock of the Company if that conversion would result in the Investor and its affiliates owning an aggregate of in excess of 4.99% of the then outstanding shares of the Company?s shares of common stock. The Company may prepay in full the unpaid principal and interest on the Convertible Note, upon notice any time prior to the 180th day after the issuance date. Any prepayment is subject to payment of a prepayment amount ranging from 110% to 135% of the then outstanding balance on the Convertible Note (inclusive of accrued and unpaid interest and any default amounts then owing), depending on when such prepayment is made. The Convertible Note also provided for anti-dilution rights in the event the Company issued or sold, except for certain limited exceptions, shares of the Company's common stock. Pursuant to an amendment to the Convertible Note entered into on Oct. 27, 2014, the provisions of the note relating to anti-dilution for future issuances was removed from the Convertible Note. The Company plans to repay the loan prior to any conversion. About Mint Leasing Houston, Texas-based The Mint Leasing, Inc., is in the business of leasing automobiles and fleet vehicles throughout the United States. Mint Leasing reported net income of $3.22 million on $6.45 million of total revenues for the year ended Dec. 31, 2013, as compared with a net loss of $238,969 on $9.97 million of total revenues in 2012. As of June 30, 2014, the Company had $17.86 million in total assets, $16.58 million in total liabilities and $1.28 million in total stockholders' equity. Bankruptcy Warning "We do not currently have any commitments of additional capital from third parties or from our sole officer and director or majority shareholders. We can provide no assurance that additional financing will be available on favorable terms, if at all. If we choose to raise additional capital through the sale of debt or equity securities, such sales may cause substantial dilution to our existing shareholders and/or trigger the anti- dilution protection of the Warrants. If we are not able to obtain additional funding to repay the Amended Loan and our other outstanding notes payable and debt facilities, we may be forced to abandon or curtail our business plan, which may cause any investment in the Company to become worthless. Our independent auditor has expressed substantial doubt regarding our ability to continue as a going concern. If we are unable to continue as a going concern, we may be forced to file for bankruptcy protection, may be forced to cease our filings with the Securities and Exchange Commission, and the value of our securities may decline in value or become worthless," the Company said in the 2013 Annual Report. MISSION NEW ENERGY: Had A$809,000 in Cash at September 30 --------------------------------------------------------- Mission New Energy Limited filed with the U.S. Securities and Exchange Commission its quarterly report for the quarter ended Sept. 30, 2014. The Company reported receipts from customers of A$599,000 during the quarter. At the beginning of the quarter, the Company had A$458,000 in cash. The Company reported an increase in cash of A$311,000 plus A$40,000 in exchange rate adjustments. As a result, the Company had A$809,000 in cash at Sept. 30, 2014. The Company spent A$107,000 for wages during the quarter. A copy of the Quarterly Report is available for free at: http://is.gd/Q1rX9K About Mission NewEnergy Based in Subiaco, Western Australia, Mission NewEnergy Limited is a producer of biodiesel that integrates sustainable biodiesel feedstock cultivation, biodiesel production and wholesale biodiesel distribution focused on the government mandated markets of the United States and Europe. The Company is not operating its biodiesel refining segment. The refineries are being held in care and maintenance either awaiting a return to positive operating conditions or the sale of assets. The Company has materially diminished its Jatropha contract farming operation and the company is now focused on divesting the remaining Indian assets. The Company intends to cease all Indian operations. Mission NewEnergy reported a net loss of $1.09 million on $9.68 million of total revenue for the year ended June 30, 2014, compared to net income of $10.05 million on $8.41 million of total revenue during the prior year. The Company's balance sheet at June 30, 2014, showed $4.04 million in total assets, $15.40 million in total liabilities and a $11.35 million total deficiency. BDO Audit (WA) Pty Ltd, in Perth, Western Australia, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2013. The independent auditors noted that the Company incurred operating cash outflows of $3.7 million during the year ended 30 June 2013 and, as of that date the consolidated entity's total liability exceeded its total assets by $12.5 million. These conditions, along with other matters, raise substantial doubt the Company's ability to continue as a going concern. MISSION NEW ENERGY: Had A$809,000 in Cash at September 30 --------------------------------------------------------- Mission New Energy Limited filed with the U.S. Securities and Exchange Commission its quarterly report for the quarter ended Sept. 30, 2014. The Company reported receipts from customers of A$599,000 during the quarter. At the beginning of the quarter, the Company had A$458,000 in cash. The Company reported an increase in cash of A$311,000 plus A$40,000 in exchange rate adjustments. As a result, the Company had A$809,000 in cash at Sept. 30, 2014. The Company spent A$107,000 for wages during the quarter. A copy of the Quarterly Report is available for free at: http://is.gd/Q1rX9K About Mission NewEnergy Based in Subiaco, Western Australia, Mission NewEnergy Limited is a producer of biodiesel that integrates sustainable biodiesel feedstock cultivation, biodiesel production and wholesale biodiesel distribution focused on the government mandated markets of the United States and Europe. The Company is not operating its biodiesel refining segment. The refineries are being held in care and maintenance either awaiting a return to positive operating conditions or the sale of assets. The Company has materially diminished its Jatropha contract farming operation and the company is now focused on divesting the remaining Indian assets. The Company intends to cease all Indian operations. Mission NewEnergy reported a net loss of $1.09 million on $9.68 million of total revenue for the year ended June 30, 2014, compared to net income of $10.05 million on $8.41 million of total revenue during the prior year. The Company's balance sheet at June 30, 2014, showed $4.04 million in total assets, $15.40 million in total liabilities and a $11.35 million total deficiency. BDO Audit (WA) Pty Ltd, in Perth, Western Australia, issued a "going concern" qualification on the consolidated financial statements for the year ended June 30, 2013. The independent auditors noted that the Company incurred operating cash outflows of $3.7 million during the year ended 30 June 2013 and, as of that date the consolidated entity's total liability exceeded its total assets by $12.5 million. These conditions, along with other matters, raise substantial doubt the Company's ability to continue as a going concern. MISSISSIPPI PHOSPHATES: Has Interim $5MM DIP Financing Approval --------------------------------------------------------------- Judge Katharine M. Samson of the U.S. Bankruptcy Court for the Southern District of Mississippi, Southern Division, gave Mississippi Phosphates Corporation, et al., interim authority to obtain up to $5,000,000 of postpetition financing from STUW LLC as agent for a consortium of lenders. The Debtors are also given interim authority to use cash collateral securing their prepetition indebtedness. Bill Rochelle and Sherri Toub, bankruptcy columnists for Bloomberg News, reported that the DIP Loan agreement requires the Debtors to file papers with the court starting the process of selling the business. An auction must be held by early February, the Bloomberg report said, citing court papers. A single customer, Interoceanic Corp., is under contract to purchase 89 percent of the company's production, Bloomberg said. The Court will conduct a final hearing commencing on Nov. 18, 2014, at 9:30 a.m. Any objections to the final approval of the financing request must be submitted on or before Nov. 10. About MPC Mississippi Phosphates Corporation is a major United States producer and marketer of diammonium phosphate ("DAP"), one of the most common types of phosphate fertilizer. MPC, which was formed as a Delaware corporation in October 1990, owns a DAP facility in Pascagoula, Mississippi, which was acquired from Nu-South, Inc. in its 1990 bankruptcy. Phosphate rock, the primary raw material used in the production of DAP, is being supplied by OCP S.A., a corporation owned by the Kingdom of Morocco. The parent, Phosphate Holdings, Inc., was formed in December 2004 in connection with the bankruptcy reorganization of MPC and its then-parent Mississippi Chemical Corporation, the first fertilizer cooperative in the United States. As of Oct. 27, 2014, MPC has a work force of 250 employees, broken into 224 regular employees and 26 "nested" third-party contract employees. MPC and its subsidiaries, namely Ammonia Tank Subsidiary, Inc., and Sulfuric Acid Tanks Subsidiary, Inc., sought Chapter 11 bankruptcy protection (Bankr. S.D. Miss. Lead Case No. 14-51667) on Oct. 27, 2014. Judge Katharine M. Samson is assigned to the cases. Mississippi Phosphates estimated $100 million to $500 million in both assets and liabilities. Affiliates Ammonia Tank and Sulfuric Acid Tanks each estimated $1 million to $10 million in both assets and liabilities. The Debtors have tapped Stephen W. Rosenblatt, Esq., at Butler Snow LLP as counsel. MISSISSIPPI PHOSPHATES: Amends Largest Unsecured Creditors List --------------------------------------------------------------- Mississippi Phosphates Corporation and its debtor affiliates filed with the U.S. Bankruptcy Court for the Southern District of Mississippi an amended list disclosing the following as the creditors holding 20 largest unsecured claims: Entity Nature of Claim Claim Amount ------ --------------- ------------ OCP Office Cherifien Des $4,830,253 Ocpangle Route D'el Jadida De La Grand Ceiinture Casablanca, Morocco Transammonia, Inc. $1,967,000 320 Park Ave 10th Floor New York, NY 10022 Oxbow Sulphur Inc. $1,741,326 1450 Lake Robbins Dr. Ste 500 The Woodlands, TX 77380 Premier Chemicals $1,455,651 4664 James Ave Ste 125 Baton Rouge, LA 70808 Shrieve Chemical $1,167,705 P. O. Box 671515 Dallas, TX 75267-1667 Central Maintenance & Weld $1,126,778 2620 Keysville Road Lithia, FL 33547 MS Power Company $1,060,528 P. O. Box 4275 Gulfport, MS 39502-4275 Hydrovac Industrial Ser. $975,105 P. O. Box 83006 Chicago, IL 60691-3010 Int'l Welding & Fabrication $886,166 11401 Hwy 63 Moss Point, MS 39562 Unimin Lime $877,322 P. O. Box 181 Calera, AL 35040 Envir. Acid Solutions $666,920 24838 NC Hwy 33 East Aurora, NC 27806 Duponte Sulfur Prod. $629,045 586 Hwy 44 La Place, LA 70068 Carrier Rental Systems $492,440 6282 Hwy 73 Geismar, LA 70734 Jackson Cty Port Auth. $423,721 P. O. Box 70 Pascagoula, MS 39568-0070 BP Energy Co. $378,150 209 Public Square Cleveland, OH 44114-2375 Plant Maintenance Ser. $352,135 37110 Hwy 30 Geismar, LA 70734 RPW, Inc. $284,301 P. O. Box 2151 Pascagoula, MS 39569 Brock Services LTD $239,968 P. O. Box 8406 Dallas, TX 75284-0640 VIP International $236,406 6638 Pecue Lane Baton Rouge, LA 70817-4400 Flexicrew $229,594 3517 Laughlin Drive Mobile, AL 36693 About MPC Mississippi Phosphates Corporation is a major United States producer and marketer of diammonium phosphate ("DAP"), one of the most common types of phosphate fertilizer. MPC, which was formed as a Delaware corporation in October 1990, owns a DAP facility in Pascagoula, Mississippi, which was acquired from Nu-South, Inc. in its 1990 bankruptcy. Phosphate rock, the primary raw material used in the production of DAP, is being supplied by OCP S.A., a corporation owned by the Kingdom of Morocco. The parent, Phosphate Holdings, Inc., was formed in December 2004 in connection with the bankruptcy reorganization of MPC and its then-parent Mississippi Chemical Corporation, the first fertilizer cooperative in the United States. As of Oct. 27, 2014, MPC has a work force of 250 employees, broken into 224 regular employees and 26 "nested" third-party contract employees. MPC and its subsidiaries, namely Ammonia Tank Subsidiary, Inc., and Sulfuric Acid Tanks Subsidiary, Inc., sought Chapter 11 bankruptcy protection (Bankr. S.D. Miss. Lead Case No. 14-51667) on Oct. 27, 2014. Judge Katharine M. Samson is assigned to the cases. Mississippi Phosphates estimated $100 million to $500 million in both assets and liabilities. Affiliates Ammonia Tank and Sulfuric Acid Tanks each estimated $1 million to $10 million in both assets and liabilities. The Debtors have tapped Stephen W. Rosenblatt, Esq., at Butler Snow LLP as counsel. MISSISSIPPI PHOSPHATES: Seeks to Employ BMC as Claims Agent ----------------------------------------------------------- Mississippi Phosphates Corporation, et al., seek authority from the U.S. Bankruptcy Court for the Southern District of Mississippi to employ BMC Group, Inc., as noticing and claims agent pursuant to 28 U.S.C. Section 156(c) and Sections 105(c) and Section 363 of the Bankruptcy Code. BMC will perform various noticing, claims management, plan solicitation, balloting, disbursement, and other services. In performing those services, BMC may, for example: (a) prepare and serve required notices and documents in the Chapter 11 case; (b) maintain an official copy of the Debtors' schedules of assets and liabilities and statements of financial affairs; (c) maintain a list of all potential creditors, equity holders and other parties- in-interest, and a "core" mailing list; (d) furnish a notice to all potential creditors of the last date for filing of proofs of claim; and (e) maintain a post office box or address for the purpose of receiving claims and returned mail, and process all mail received. Upon the entry of an order authorizing the employment of BMC, the Debtors will provide BMC with a $5,000 evergreen retainer to remain outstanding at all times. Brad Daniel, a director for BMC Group, Inc., assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. About MPC Mississippi Phosphates Corporation is a major United States producer and marketer of diammonium phosphate ("DAP"), one of the most common types of phosphate fertilizer. MPC, which was formed as a Delaware corporation in October 1990, owns a DAP facility in Pascagoula, Mississippi, which was acquired from Nu-South, Inc. in its 1990 bankruptcy. Phosphate rock, the primary raw material used in the production of DAP, is being supplied by OCP S.A., a corporation owned by the Kingdom of Morocco. The parent, Phosphate Holdings, Inc., was formed in December 2004 in connection with the bankruptcy reorganization of MPC and its then-parent Mississippi Chemical Corporation, the first fertilizer cooperative in the United States. As of Oct. 27, 2014, MPC has a work force of 250 employees, broken into 224 regular employees and 26 "nested" third-party contract employees. MPC and its subsidiaries, namely Ammonia Tank Subsidiary, Inc., and Sulfuric Acid Tanks Subsidiary, Inc., sought Chapter 11 bankruptcy protection (Bankr. S.D. Miss. Lead Case No. 14-51667) on Oct. 27, 2014. Judge Katharine M. Samson is assigned to the cases. Mississippi Phosphates estimated $100 million to $500 million in both assets and liabilities. Affiliates Ammonia Tank and Sulfuric Acid Tanks each estimated $1 million to $10 million in both assets and liabilities. The Debtors have tapped Stephen W. Rosenblatt, Esq., at Butler Snow LLP as counsel. MISSISSIPPI PHOSPHATES: Has Interim OK to Pay Insurance Premiums ---------------------------------------------------------------- Judge Katharine M. Samson of the U.S. Bankruptcy Court for the Southern District of Mississippi gave Mississippi Phosphates Corporation, et al., interim authority to pay postpetition installments on insurance policies necessary to maintain insurance coverage. About MPC Mississippi Phosphates Corporation is a major United States producer and marketer of diammonium phosphate ("DAP"), one of the most common types of phosphate fertilizer. MPC, which was formed as a Delaware corporation in October 1990, owns a DAP facility in Pascagoula, Mississippi, which was acquired from Nu-South, Inc. in its 1990 bankruptcy. Phosphate rock, the primary raw material used in the production of DAP, is being supplied by OCP S.A., a corporation owned by the Kingdom of Morocco. The parent, Phosphate Holdings, Inc., was formed in December 2004 in connection with the bankruptcy reorganization of MPC and its then-parent Mississippi Chemical Corporation, the first fertilizer cooperative in the United States. As of Oct. 27, 2014, MPC has a work force of 250 employees, broken into 224 regular employees and 26 "nested" third-party contract employees. MPC and its subsidiaries, namely Ammonia Tank Subsidiary, Inc., and Sulfuric Acid Tanks Subsidiary, Inc., sought Chapter 11 bankruptcy protection (Bankr. S.D. Miss. Lead Case No. 14-51667) on Oct. 27, 2014. Judge Katharine M. Samson is assigned to the cases. Mississippi Phosphates estimated $100 million to $500 million in both assets and liabilities. Affiliates Ammonia Tank and Sulfuric Acid Tanks each estimated $1 million to $10 million in both assets and liabilities. The Debtors have tapped Stephen W. Rosenblatt, Esq., at Butler Snow LLP as counsel. MOMENTIVE SPECIALTY: Four Directors Resigned -------------------------------------------- Scott M. Kleinman, Geoffrey A. Manna, David B. Sambur and Robert V. Seminara resigned as members of the Board of Directors of Momentive Specialty Chemicals Inc. on Oct. 27, 2014, according to a regulatory filing with the U.S. Securities and Exchange Commission. Robert Kalsow-Ramos and Geoffrey A. Manna were appointed as managers of Momentive Performance Materials Holdings LLC, the indirect parent of the Company. As a result, Holdings' Board of Managers, which has been entrusted with the supervision of the Company's management and the course of the Company's affairs and business operations, consists of the following members: William H. Carter, William H. Joyce, Robert Kalsow-Ramos, Scott M. Kleinman, Geoffrey A. Manna, Craig O. Morrison, Jonathan Rich, David B. Sambur and Marvin O. Schlanger. About Momentive Specialty Momentive Specialty Chemicals, Inc., headquartered in Columbus, Ohio, is a leading producer of thermoset resins (epoxy, formaldehyde and acrylic). The company is also a supplier of specialty resins for inks and specialty coatings sold to a diverse customer base as well as a producer of commodities such as formaldehyde, bisphenol A, epichlorohydrin, versatic acid and related derivatives. Momentive Specialty reported a net loss of $634 million on $4.89 billion of net sales for the year ended Dec. 31, 2013, as compared with net income of $346 million on $4.75 billion of net sales for the year ended Dec. 31, 2012. As of March 31, 2014, the Company had $2.95 billion in total assets, $5.05 billion in total liabilities and a $2.10 billion total deficit. * * * The TCR reported on Oct. 3, 2014, that Standard & Poor's Ratings Services lowered its corporate credit rating on Momentive Specialty Chemicals Inc. (MSC) by one notch to 'CCC+' from 'B-'. "The downgrade follows MSC's significant use of cash in the first half of 2014 and our expectation that lackluster cash flow from operations and elevated capital spending will cause free operating cash flow to be significantly negative in 2014 and 2015," said Standard & Poor's credit analyst Cynthia Werneth. As reported by the TCR on May 5, 2014, Moody's Investors Service affirmed Momentive Specialty Chemicals Inc's (MSC) corporate family rating (CFR) at B3 but changed the ratings outlook to negative due to weak credit metrics and the expectation that credit metrics will not return to levels fully supportive of the B3 Corporate Family Rating in 2014. MUD KING: Mazelle Krasoff Seeks to Withdraw as Counsel ------------------------------------------------------ Mud King Products, Inc. filed a notice with the Bankruptcy Court to inform that Mazelle Krasoff requested to withdraw as counsel of record in the bankruptcy case of the Debtor. Edward Rothberg and Melissa Haselden, at the offices of Hoover Slovacek LLP, will remain as counsel of record for the Debtor. Ms. Krasoff further requests that the Clerk of Court remove her from the Court's notice service lists for the action, as well as from CM/ECF electronic mailings including, without limitation, orders and notices of any applications, motion, petition, pleading, request, complaint, or demand, whether formal or informal, whether written or oral and whether transmitted or conveyed by mail, delivery, telephone, telex, or otherwise which affect or seek to affect in anyway the matters in this case. About Mud King Products Mud King Products, Inc., filed a Chapter 11 petition (Bank. S.D. Tex. Case No. 13-32101) on April 5, 2013. The petition was signed by Erich Mundinger as vice president. The Debtor disclosed $18,959,158 in assets and $3,351,216 in liabilities as of the Chapter 11 filing. Annie E Catmull, Esq., Melissa Anne Haselden, Esq., and Edward L Rothberg, Esq., at Hoover Slovacek, LLP, represent the Debtor in its restructuring effort. Judge Karen K. Brown presides over the case. The U.S. Trustee was unable to appoint an official committee of unsecured creditor. MUSCLEPHARM CORP: Revises Previously Filed Financial Reports ------------------------------------------------------------ MusclePharm Corporation disclosed with the U.S. Securities and Exchange Commission that its previously issued unaudited quarterly financial statements as of and for the fiscal quarter ended June 30, 2014, should no longer be relied upon. As a result, the Company filed an amended quarterly report for the period ended June 30, 2014, restating its financial statements for this period. The following discussion describes the adjustments made in the Amendment: "Note 16 Insurance Recovery" in the June 30, 2014, 10-Q will be deleted. As a result, the Consolidated Balance Sheets amount "Other receivable" $1,342,843, will be adjusted to $0, and the respective amounts of "Other assets", "Total assets" and "Total stockholders' equity" will be adjusted by reducing those amounts by $1,342,843; Professional Fees in the Consolidated Statements of Operations for the three and six months ended June 30, 2014, will be increased to $1,292,517 and $2,077,090, respectively, with appropriate adjustment to "Total operating expenses", "Operating Income (loss)" and "Net Income (loss) before taxes" and "Net Income", "Total Comprehensive Income (loss)" and respective "Net income (loss) per share" amounts reported. Due to the restatement, the Company's management and Audit Committee reevaluated Part I, Item 4 ("Controls and Procedures") in the previously filed June 30, 2014, Form 10-Q and have now concluded that the Company's disclosure controls and procedures and internal control over financial reporting were not effective as of that date. The Board has been actively engaged in developing a remediation plan to address the identified ineffective controls that existed as of June 30, 2014. Implementation of the remediation plan is in process and consists of, among other things, redesigning the procedures to enhance the identification, capture, review, approval and recording of contract terms including insurance agreements and the treatment and confirmation of insurance recoveries. The Company's Disclosure Committee has appointed, subject to the approval of the Board of Directors of the Company, the Company's Executive Vice President of Finance, as the Chairman of the Company's Disclosure Committee and its Risk Management Officer to ensure compliance with the remediation plan. In his capacity as RMO, John Price will be responsible for managing the Company's risk assessment as it relates to financial reporting obligations, SEC disclosures as well as implementing, managing, and assuring compliance with the remediation plan. Meanwhile, following requests for information received by the Company from the Denver Regional Office of the SEC, the Company undertook to review its disclosures related to compensation, benefits and perquisites in several of its prior Annual Reports on Form 10-K. The Company has provided information to the Staff in response to its inquiries. In the process of reviewing its records and preparing those submissions, the Company has determined to revise its previously filed compensation disclosure for the fiscal years ended Dec. 31, 2010, 2011, 2012 and 2013. The Company determined that it improperly excluded certain items that should have been reported in the Summary Compensation Tables under Item 402(b) of Regulation S-K in the Company's Annual Reports for the Fiscal Years ended Dec. 31, 2010 - 2013. The 10-K Amendments have been reviewed by the Audit Committee of the Board of Directors. As previously reported, the Company appointed a new Chairman of the Audit Committee. In addition to the review of the Company's previous disclosures related to compensation, benefits and perquisites, the Chairman of the Audit Committee authorized a review by the Company of all available information related to business expenses and perquisites paid on behalf of the Company's executives and non-employee directors for Fiscal Years 2010 - 2013 and for the current Fiscal Year. In addition to reviewing and approving the Company's revised disclosure in the Summary Compensation Tables for Fiscal Years 2010 - 2013, to be reflected in the 10-K Amendments, the Audit Committee has recommended the adoption of enhanced policies and procedures for the tracking, accounting, and disclosing of the Company's business expenses, perquisites and other personal benefits paid to or on behalf of executive officers and non- employee directors of the Company. The Corrective Action Plan will include, among other items, the adoption of the following general statements of policy related to the payment and disclosure of perquisites by the Company: * The Company subscribes to the principles adopted by the SEC in its November 7, 2006 Release (Release 33-8732A) and subsequent interpretations regarding disclosure of Perquisites and Other Personal Benefits; * The Company will seek outside guidance from independent third parties (counsel and financial/reporting experts) in connection with review and disclosure of perquisites and other personal benefits provided to the executive officers and non-employee directors of the Company; * The Company has updated its contact information to direct whistleblower communications to outside counsel and the chairman of the Audit Committee as initial points of contact; and * The Company requires all waivers of privilege determinations to be made by the Audit Committee in connection with current Staff inquiries. These current and former executive officers of the Company have agreed to repay or to have deducted from their next paycheck, certain amounts that were considered during the review to be predominantly personal in nature, or for certain undocumented or unsupported expenses during the periods reviewed which were previously characterized as business expenses and charged to the Company for Fiscal Years 2010 - 2013. Any such repayments do not necessarily reflect, and the Board of Directors has not made any determination as to the existence of, any incorrect actions on the part of the named executive officers. The repayments are being made voluntarily by the executives. * Bradley J. Pyatt: $62,082 * Richard Estalella: $893 * Donald W. Prosser: $234 * Cory J. Gregory: $9,798 * Gary Davis: $516 * Jeremy DeLuca: $10,476 The Board of Directors, in the exercise of its business judgment, will determine what, if any, steps the Company will take to collect from the former named executive officers of the Company named below the amounts set forth opposite their names. Any repayments do not necessarily reflect, and the Board of Directors has not made any determination as to the existence of, any incorrect actions on the part of the former executive officers. * John Bluher: $4,000 * Lawrence Meer: $1,111 A copy of the amended Form 10-K for the year ended Dec. 31, 2012, is available for free at http://is.gd/XWqyW4 A copy of the amended Form 10-K for the year ended Dec. 31, 2013, is available for free at http://is.gd/OyycsP A copy of the amended Form 10-Q for the period ended June 30, 2014, is available for free at http://is.gd/kqrve6 About MusclePharm Headquartered in Denver, Colorado, MusclePharm Corporation (OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life- style company that develops and manufactures a full line of National Science Foundation approved nutritional supplements that are 100 percent free of banned substances. MusclePharm is sold in over 120 countries and available in over 5,000 U.S. retail outlets, including GNC and Vitamin Shoppe. MusclePharm products are also sold in over 100 online stores, including bodybuilding.com, Amazon.com and Vitacost.com. MusclePharm reported a net loss after taxes of $17.71 million in 2013, a net loss after taxes of $18.95 million in 2012, and a net loss of $23.28 million in 2011. As of June 30, 2014, MusclePharm had $65.59 million in total assets, $28.83 million in total liabilities and $36.75 million in total stockholders' equity. NAARTJIE CUSTOM: Hilco Retained to Sell Naartjie Kids Brand ----------------------------------------------------------- Hilco Streambank has been retained to sell the NaartjieR Kids brand and the Company's interests in its South African subsidiary. The assets include the worldwide trademark portfolio, the NaartjieKids.com e-commerce platform, customer files and domain names. The assets also include the Company's interests in its wholly owned South African subsidiary ZA One. The assets will be sold through a chapter 11 bankruptcy sale process. The bid deadline has been set for Nov. 21, 2014. "Naartjie presents a unique opportunity to acquire the assets of an internationally recognized children's apparel brand with differentiated content and a loyal customer base," said David Peress, EVP of Hilco Streambank. "We're already generating a significant level of interest in these assets" said Mr. Peress. About Naartjie Custom Kids Naartjie Custom Kids, Inc., which designs, manufactures and sells children's clothing, accessories and footwear for ages newborn through 10 years old, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Utah Case No. 14-29666) on Sept. 12, 2014. The case is assigned to Judge William T. Thurman. The Debtor's counsel is Annette W. Jarvis, Esq., Jeffrey M. Armington, Esq., Benjamin J. Kotter, Esq., and Michael F. Thomson, Esq., at Dorsey & Whitney LLP, in Salt Lake City, Utah. NATROL INC: Bankrupt Vitamin Maker Gets Nod for Nov. 10 Auction --------------------------------------------------------------- Law360 reported that U.S. Bankruptcy Judge Brendan L. Shannon in Wilmington, Delaware, approved the procedures that allow potential suitors to either acquire Natrol Inc.'s assets or refinance its debt, and scheduled an auction for Nov. 10. According to the report, bids are due Nov. 6 and the hearing to approve a sale or refinancing transaction will be held on Nov. 12. As previously reported by the TCR, the sale is in line with the settlement entered between Natrol's secured lender, Cerberus Business Finance LLC, and the Official Committee of Unsecured Creditors, which requires Natrol to sell its assets or refinance the more than $68.8 million Cerberus debt. Under the settlement, the sale must be completed by Dec. 15. Bill Rochelle and Sherri Toub, bankruptcy columnists for Bloomberg News, noted that Natrol has no buyer or replacement lender under contract yet. About Natrol, Inc. Headquartered in Chatsworth, Calif., Natrol, Inc. -- http://www.natrol.com-- is a wholly owned subsidiary of Plethico Pharmaceuticals Limited. Plethico Pharmaceuticals Limited (BSE: 532739. BO: PLETHICO) engages in the manufacturing, marketing and distribution of pharmaceutical and allied healthcare products around the world. Natrol products are made in the U.S. Established in 1980, Natrol, Inc. has been a global leader in the nutrition industry, and a trusted manufacturer and marketer of a superior quality of herbs and botanicals, multivitamins, specialty and sports nutrition supplements made to support health and wellness throughout all ages and stages of life. Natrol products are available in health food stores, drug and grocery stores, and mass-market retailers, and through Natrol.com and other online retailers. Natrol distributes products nationally through more than 54,000 retailers as well as internationally in over 40 other countries through distribution partners. Natrol, Inc., and its six affiliates sought bankruptcy protection on June 11, 2014 (Case No. 14-11446, Bankr. D. Del.). The case is assigned to Judge Brendan Linehan Shannon. The Debtors are represented by Robert A. Klyman, Esq., and Samuel A. Newman, Esq., at GIBSON, DUNN & CRUTCHER LLP, in Los Angeles, California; and Michael R. Nestor, Esq., Maris J. Kandestin, Esq., and Ian J. Bambrick, Esq., at YOUNG CONAWAY STARGATT & TAYLOR, LLP, in Wilmington, Delaware. The Debtors' Claims and Noticing Agent is EPIQ SYSTEMS INC. The Debtors requested that the Court approve the employment of (i) Jeffrey C. Perea of the firm Conway MacKenzie Management Services, LLC as chief financial officer and for CMS to provide temporary employees to assist Mr. Perea in carrying out his duties; (ii) Stephen P. Milner of the firm Squar, Milner, Peterson, Miranda & Williamson LLP as chief restructuring officer and for CMS to provide temporary employees to assist Mr. Milner in carrying out his duties; (iv) BDO USA, LLP as auditor; (v) TaxGroup Partners as tax services provider. The U.S. Trustee for Region 3 on June 19 appointed five creditors of Natrol, Inc. to serve on the official committee of unsecured creditors. The Committee tapped to retain Otterbourg P.C. as lead counsel; (ii) Pepper Hamilton LLP as Delaware counsel; and (iii) CMAG as financial advisors. The Debtors reported total assets of $83,932,462 and total liabilities of $87,174,387. NEPHROS INC: Amends 5 Million Shares Prospectus ----------------------------------------------- Nephros, Inc., filed with the U.S. Securities and Exchange Commission an amended Form S-1 registration statement relating to the distribution, at no charge, to holders of the Company's common stock or warrants non-transferable subscription rights to purchase up to 5,000,000 shares of the Company's common stock. The Company amended the Registration Statement to delay its effective date. Shares of the Company's common stock are quoted on the OTCQB Marketplace operated by the OTC Markets Group, Inc., or OTCQB, under the ticker symbol "NEPH." On [ ], 2014, the closing sales price for the Company's common stock was $[ ] per share. The shares of common stock issued in the rights offering will also be quoted on the OTCQB under the same ticker symbol. The subscription rights will not be listed for trading on any stock exchange or market or quoted on the OTCQB. This is not an underwritten offering. The shares are being offered directly by the Company without the services of an underwriter or selling agent. A copy of the Form S-1/A prospectus is available at: http://is.gd/kSJNgx About Nephros River Edge, N.J.-based Nephros, Inc., is a commercial stage medical device company that develops and sells high performance liquid purification filters. Its filters, which it calls ultrafilters, are primarily used in dialysis centers and healthcare facilities for the production of ultrapure water and bicarbonate. Nephros, Inc., reported a net loss of $3.69 million in 2013 following a net loss of $3.26 million in 2012. As of June 30, 2014, the Company had $2.35 million in total assets, $2.13 million in total liabilities and $216,000 in total stockholders' equity. Rothstein Kass, in Roseland, New Jersey, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has incurred negative cash flow from operations and net losses since inception. These conditions, among others, raise substantial doubt about its ability to continue as a going concern. NET TALK.COM: Seeks to Annul President's Action ----------------------------------------------- Net Talk.com, Inc., disclosed with the U.S. Securities and Exchange Commission that it is working with its counsel to rescind an unauthorized encumbrance by Samer Bishay, current president of the Company. Mr. Bishay, on or about Oct. 24, 2014, through counsel for Telestrata, LLC, filed a mortgage in the amount of approximately $4.5 million encumbering certain assets of the Company. The Company asserted Mr. Bishay was not authorized to file said mortgage, as the Board of Directors authorized the company to undertake such action only under certain conditions, and authorized only Steven Healy, as chief financial officer of the Company, to be signatory to any such action. As reported by the TCR on Oct. 20, 2014, shareholders representing at least a majority of the then outstanding common stock of the Company voted, via written consent in lieu of a meeting, to remove each of Samer Bishay, Maged Bishara, and Nardir Aljasrawi from their positions serving as members of the Company's Board of Directors. About Net Talk.com Based in Miami, Fla., Net Talk.com, Inc., is a telephone company, that provides, sells and supplies commercial and residential telecommunication services, including services utilizing voice over internet protocol technology, session initiation protocol technology, wireless fidelity technology, wireless maximum technology, marine satellite services technology and other similar type technologies. Net Talk.com a net loss of $4.78 million on $6.02 million of net revenues for the year ended Dec. 31, 2013, as compared with a net loss of $14.71 million on $5.79 million of net revenues in 2012. As of June 30, 2014, the Company had $5.07 million in total assets, $12.42 million in total liabilities and a $7.35 million total stockholders' deficit. Zachary Salum Auditors P.A., in Miami, Florida, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has incurred significant recurring losses from operations, its total liabilities exceeds its total assets, and is dependent on outside sources of funding for continuation of its operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. NEW YORK MART: Case Summary & 10 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: New York Mart Ave. U 2nd Inc. 1721 Avenue U Brooklyn, NY 11229 Case No.: 14-45655 Chapter 11 Petition Date: November 5, 2014 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Hon. Nancy Hershey Lord Debtor's Counsel: Gregory M. Messer, Esq. LAW OFFICES OF GREGORY MESSER, PLLC 26 Court Street, Suite 2400 Brooklyn, NY 11242 Tel: (718) 858-1474 Fax: (718) 797-5360 Email: gremesser@aol.com Total Assets: $732,644 Total Liabilities: $1 million The petition was signed by Shunyu She, vice president. A list of the Debtor's 10 largest unsecured creditors is available for free at http://bankrupt.com/misc/nyeb14-45655.pdf NORTEL NETWORKS: Asks Court to Approve Hewlett-Packard Settlement ----------------------------------------------------------------- Nortel Networks Inc. has filed a motion seeking court approval for a deal that would resolve its dispute with Hewlett-Packard Co. and Hewlett-Packard Financial Services Co. Nortel in January 2011 sued the tech firms to recover more than $5.18 million it paid for goods sold and services provided by the firms. Under the deal, Nortel agreed to dismiss the lawsuit in return for a payment of $118,000 by each of the firms in the form of a reduction of their respective claims against the telecommunications company. Hewlett-Packard can assert a general unsecured claim of $837,892 while the other tech firm can assert a general unsecured claim of $2,072 against Nortel, according to the deal. The agreement is available for free at http://is.gd/nYTlOh The motion is on U.S. Bankruptcy Judge Kevin Gross' calendar for Dec. 2. Objections are due by Nov. 25. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel did business in more than 150 countries around the world. Nortel Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., and Howard S. Zelbo, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serve as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The U.S. Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, and Christopher M. Samis, Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, represent the Unsecured Creditors Committee. An ad hoc group of bondholders also was organized. An Official Committee of Retired Employees and the Official Committee of Long- Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. The trial on how to divide proceeds among creditors in the U.S., Canada, and Europe commenced on Sept. 22, 2014. NNN 3500 MAPLE 26: Wins Confirmation of Joint Chapter 11 Plan ------------------------------------------------------------- Bankruptcy Judge Harlin Dewayne Hale issued Findings of Fact, Conclusions of Law and Order confirming the Joint Chapter 11 Plan of NNN 3500 Maple 26, LLC, et al. The Court entered an Order dated August 29, 2014, approving the explanatory Disclosure Statement as having "adequate information" under section 1125 of the Bankruptcy Code, and established October 21, 2014 as the date of the hearing to consider confirmation of the Plan. As reported by the Troubled Company Reporter on Sept. 22, the disclosure statement provides that NNN 3500 Maple and its affiliated debtors are "jointly and severally liable on all claims." They do not intend to solicit acceptances on a separate "debtor-by-debtor" basis. Approval of the plan will apply to NNN 3500 Maple and all its affiliated debtors. The Plan provides for a 100% estimated recovery to all creditors. As of the effective date of the plan, ownership of the assets of each company's estate will vest in that company free and clear of liens, claims, rights, title and interests. U.S. Bank National Association, as Trustee, successor-in-interest to Bank of America, N.A., as Trustee for the Registered Holders of Wachovia Bank Commercial Mortgage Trust, Commercial Mortgage Pass- Through Certificates, Series 2006-C23, by and through CWCapital Asset Management LLC, filed a limited objection to the Plan. A copy of the Court's November 4, 2014 Findings of Fact, Conclusions of Law and Order Confirming the Debtors' Joint Chapter 11 Plan is available at http://bit.ly/1GvgxkIfrom Leagle.com. About NNN 3500 Maple Entities NNN 3500 Maple 26, LLC, based in Costa Mesa, Calif., filed for Chapter 11 bankruptcy (Bankr. C.D. Calif. Case No. 12-23718) on Nov. 30, 2012. Judge Scott C. Clarkson presided over the case. In its schedules, the Debtor disclosed $45,563,241 in total assets and $46,658,593 in total liabilities. On Jan. 23, 2013, the California Bankruptcy Court entered an order transferring venue of the bankruptcy case to the U.S. Bankruptcy Court for the Northern District of Texas (Case No. 13-30402). Judge Harlin DeWayne Hale in Dallas presides over the case. On Aug. 29, 2013, 26 other affiliates filed separate Chapter 11 petitions. These entities are: NNN 3500 Maple 1, LLC, NNN 3500 Maple 2, LLC, NNN 3500 Maple 3, LLC, NNN 3500 Maple 4, LLC, NNN 3500 Maple 5, LLC, NNN 3500 Maple 6, LLC, NNN 3500 Maple 7, LLC, NNN 3500 Maple 10, LLC, NNN 3500 Maple 12, LLC, NNN 3500 Maple 13, LLC, NNN 3500 Maple 14, LLC, NNN 3500 Maple 15, LLC, NNN 3500 Maple 16, LLC, NNN 3500 Maple 17, LLC, NNN 3500 Maple 18, LLC, NNN 3500 Maple 20, LLC, NNN 3500 Maple 22, LLC, NNN 3500 Maple 23, LLC, NNN 3500 Maple 24, LLC, NNN 3500 Maple 27, LLC, NNN 3500 Maple 28, LLC, NNN 3500 Maple 29, LLC, NNN 3500 Maple 30, LLC, NNN 3500 Maple 31, LLC, NNN 3500 Maple 32, LLC, and NNN 3500 Maple 34. Each Debtor holds an ownership interest as a tenant in common in an 18-story commercial office building commonly known as 3500 Maple Avenue, Dallas, Texas 75219. These TICs have not filed for bankruptcy: NNN 3500 Maple 0, LLC, NNN 3500 Maple 8, LLC, NNN 3500 Maple 9, LLC, NNN 3500 Maple 11, LLC, NNN 3500 Maple 25, LLC, and NNN 3500 Maple 35, LLC. Bankruptcy Judge Harlin DeWane Hale denied confirmation of two competing reorganization plans filed in the Chapter 11 cases of NNN 3500 Maple 26 LLC and its affiliated debtors. The Plan is to be funded by an $8.5 million "Cash Infusion" and "Additional Equity Contributions" of around $10 million. Under the Debtors' Plan, the building will undergo substantial rehabilitation. The Plan propose by Strategic Acquisition Partners, LLC, a party that acquired a claim in the case, similar to the Debtors', in an attempted cure and restatement, will replace the Borrower with NewCo under the Loan Documents. NewCo will be divided into Class A and Class B membership interests. An official creditors' committee has not been appointed in this case. Neither a trustee nor an examiner has been appointed. The Debtors are represented by Michelle V. Larson, Esq., at ANDREWS KURTH LLP, and Jeremy B. Reckmeyer, Esq., at ANDREWS KURTH LLP. Strategic Acquisition Partners LLC is represented by Joseph J. Wielebinski, Esq., Davor Rukavina, Esq., Zachery Z. Annable, Esq., and Thomas D. Berghman, Esq., at MUNSCH HARDT KOPF & HARR, P.C. William B. Finkelstein, Esq., Esq., and Jeffrey R. Fine, Esq., at DYKEMA GOSSETT PLLC serve as counsel to Maple Avenue Tower, LLC. OMNICARE INC: S&P Lowers Subordinated Debt Rating to 'B+' --------------------------------------------------------- Standard & Poor's Ratings Services assigned a 'BBB-' issue-level rating to Omnicare Inc.'s proposed unsecured notes. The '1' recovery rating reflects S&P's expectation for very high (90%- 100%) recovery in the event of a payment default. S&P also lowered its issue-level rating on Omnicare's subordinated debt to 'B+' from 'BB' and revised the recovery rating to '6' from '4', indicating S&P's expectation for negligible (0%-10%) recovery in the event of a payment default. The downgrade reflects reduced recovery prospects resulting from the addition of higher priority debt. At the same time, S&P affirmed its 'BB' corporate credit rating on Omnicare. The outlook is stable. "Omnicare maintains a good market position in a narrow business. The company is exposed to reimbursement risk and indirectly relies on the government for a significant 50% of revenue for its pharmacy services," said credit analyst David Peknay. "However, the company's position as one of two leading market participants that provide pharmacy services to nursing homes and other long- term care providers partly offset those risks, supporting its "fair" business risk profile." "Our stable rating outlook incorporates our expectation that Omnicare will continue to experience greater growth in its specialty group, offsetting weaker growth prospects for its long- term care group. It also reflects our view that the company will continue to generate significant discretionary cash flow, and that the company will return cash to shareholders while maintaining current credit protection measures," S&P said. Downside Scenario S&P could lower its ratings if the recent stabilization in beds served reverses, the company pursues significant debt-financed acquisitions or share repurchases, or reduced reimbursement pushes debt to EBITDA over 4x on a sustained basis. S&P believes a 5% revenue decline accompanied by an estimated 200-basis-point (bp) margin reduction over the next year could raise leverage to about 4x, excluding the impact of any share repurchases or acquisition activity. Upside Scenario S&P could raise its rating if Omnicare reduces debt leverage to less than 3x and establishes a commitment to sustaining leverage at this level. S&P believes this could be achieved through debt reduction, an increase in beds served, and a greater contribution from the higher-margin specialty care segment. S&P believes the company would need to either reduce debt by around $500 million or improve margins by around 400 bps to support leverage at levels consistent with a higher rating. ORMET CORP: Gets Nod to Dismiss Chapter 11 Case ----------------------------------------------- Law360 reported that U.S. Bankruptcy Judge Mary F. Walrath in Wilmington agreed to dismiss former aluminum smelter Ormet Corp.'s Chapter 11 case after approving a credit bid deal to sell its residual assets to private equity lender Wayzata Investment Partners LLC, which credit bid its outstanding claims and held debt, including $7.5 million owed under a prepetition term loan. According to Law360, Judge Walrath agreed to grant Ormet's request for a dismissal as soon the debtor winds up its remaining affairs. Bill Rochelle and Sherri Toub, bankruptcy columnists for Bloomberg News, reported that Ormet said in court papers that continuing the Chapter 11 case following consummation of the final sale and settlements won't result in further recoveries to creditors. Instead, it would incur additional administrative costs that the company can't afford to fund, the Bloomberg report related. About Ormet Corp. Aluminum producer Ormet Corporation, along with affiliates, filed for Chapter 11 protection (Bankr. D. Del. Case No. 13-10334) on Feb. 25, 2013, with a deal to sell the business to a portfolio company owned by private investment funds managed by Wayzata Investment Partners LLC. Headquartered in Wheeling, West Virginia, Ormet -- http://www.ormet.com/-- is a fully integrated aluminum manufacturer, providing primary metal, extrusion and thixotropic billet, foil and flat rolled sheet and other products. Ormet disclosed assets of $406.8 million and liabilities totaling $416 million. Secured debt of about $180 million includes $139.5 million on a secured term loan and $39.3 million on a revolving credit. Affiliates that separately filed Chapter 11 petitions are Ormet Primary Aluminum Corporation; Ormet Aluminum Mill Products Corporation; Specialty Blanks Holding Corporation; and Ormet Railroad Corporation. Ormet emerged from a prior bankruptcy in April 2005. Lender Wayzata Investment Partners LLC is among existing owners. Others are UBS Willow Fund LLC and Fidelity Leverage Company Stock Fund. In the 2013 case, Ormet is represented in the case by Morris, Nichols, Arsht & Tunnell LLP's Erin R. Fay, Esq., Robert J. Dehney, Esq., Daniel B. Butz, Esq.; and Dinsmore & Shohl LLP's Kim Martin Lewis, Esq., Patrick D. Burns, Esq. Kurtzman Carson Consultants is the claims and notice agent. Evercore's Lloyd Sprung and Paul Billyard serve as investment bankers to the Debtor. An official committee of unsecured creditors was appointed in the case in March 2013. The Committee is represented by Rafael X. Zahralddin, Esq., Shelley A. Kinsella, Esq., and Jonathan M. Stemerman, Esq., at Elliott Greenleaf; and Sharon Levine, Esq., S. Jason Teele, Esq., and Cassandra M. Porter, Esq., at Lowenstein Sandler LLP. In October 2013, the U.S. Trustee filed papers saying the bankruptcy instead should be converted to a liquidation in Chapter 7. The U.S. Trustee said there is no budget and no financing for a wind-down in Chapter 11. In November 2013, the Bankruptcy Court approved on an interim basis Ormet's motion for (a) an interim plan to wind down the Debtors' businesses and protections for certain employees implementing the wind down, (b) authorizing the Debtors to modify employee benefit plans consistent with the wind down plan, and (c) authorizing the Debtors to take any and all actions necessary to implement the wind down plan. In December 2013, Ormet completed a previously approved sale of its alumina smelter in Burnside, Louisiana, to Almatis Inc. for $39.4 million. There was no auction. Completion of a court- approved sale of the business to lender and part owner Wayzata Investment Partners LLC became impossible when Ohio utility regulators refused in October to grant reductions in electricity prices. Wayzata would have acquired the business largely in exchange for debt. Ormet also has sold 32,000 metric tons of alumina for $8.4 million to Glencore AG, and its rights and interests in and to 17,086 MT baked carbon anodes, located at the Debtors' Hannibal, Ohio location, and its rights and interest in and to 34,755 MT baked carbon anodes, located in a storage in Baltimore, Maryland, to Alcoa Materials Management, Inc. In 2014, the Bankruptcy Court issued several interim orders related to the wind-down plan. Those orders authorize the Debtors to make payments through a certain date, as part of implementing the wind-down plan. PENGUIN DRIVE-IN: Manager Gives Up Restaurant; Sale Uncertain ------------------------------------------------------------- Jennifer Thomas at the Charlotte Business Journal reports that Penguin Drive-In's manager Lisa Ballentine agreed on Monday to surrender the restaurant's keys to Plaza-Midwood landlord, 1921 Commonwealth Avenue Holdings. Eric Frazier at Charlotteobserver.com relates 1921 Commonwealth sued the Penguin Drive-In management in 2013, accusing the eatery of defaulting on its lease and a $17,763 loan. The Penguin Drive- In management, according to Charlotteobserver.com, owed more than $75,000 under its lease. The report says that when Don Rawlins, an attorney listed as an official with 1921 Commonwealth, was asked whether Ms. Ballentine still owes the money, he replied, "That's to be decided" as the bankruptcy case continues. According to Charlotte Business Journal, Samantha Brumbaugh, the attorney for Ms. Ballentine, initially sought a continuance of the proceedings, saying that an investor is interested in assuming the Penguin Drive-In's lease and purchasing its assets. Penguin Drive-In, Business Journal states, sought in October permission from the U.S. Bankruptcy Court for the Western District of North Carolina to sell substantially all of its assets to Sun Shark Holdings LLC for $100,000. The sale is expected to close on Nov. 12, the Business Journal relates. WCNC says that the Bankruptcy Court will decide what happens to the Penguin name and logo. Jeremy Markovich at WCNC reports that the Penguin Drive-In restaurant had been closed since August. According to an August 2014 report by NBC Charlotte, Ms. Ballentine said that the restaurant was closed for several days due to a death in the family of a line cook, and that she and her staff decided to take some time off. Charlotteobserver.com adds that Ms. Ballentine initially said it would reopen on Aug. 6, but that didn't happen. About Penguin Drive-In Penguin Drive-In, LLC filed for Chapter 11 bankruptcy (Bankr. W.D.N.C. Case No. 13-32353) on Nov. 5, 2013, listing under $1 million in both assets and debts. Affiliate Penguin Holdings, Inc. filed a separate Chapter 11 petition (Bankr. W.D.N.C. Case No. 13-32354) on Nov. 5, 2013, also listing under $1 million in both assets and debts. As reported by the Troubled Company Reporter on May 15, 2014, Eric Frazier, writing for The Charlotte Observer, reported that U.S. Bankruptcy Court Judge J. Craig Whitley in an April 16 order dismissed the Chapter 11 bankruptcy case filed in 2013 by the manager of the Penguin Drive-In restaurant, after the eatery failed to pay court-ordered quarterly fees and file monthly status reports and submit its 2012 tax return. Eric Frazier at Charlotteobserver.com reported on Nov. 3, 2014, that the second bankruptcy case associated with the restaurant also was dismissed, but the restaurant again filed for bankruptcy in August 2014. PHOENIX REALTY: Bank Lender to Hold Foreclosure Sale on Dec. 5 -------------------------------------------------------------- Androscoggin Savings Bank will sell at a foreclosure auction on Dec. 5, 2014, at 3:00 p.m. the personal property of Phoenix Realty Holdings, LLC. The sale will be held at 49 Kamich Drive, Augusta, Maine. The Real Estate and any Personal Property will be sold on an AS IS WHERE IS BASIS. Any bidder wishing to bid must, prior to the start of the auction, make a deposit of $10,000 to bid in cash or certified U.S. funds made payable to Keenan Auction Company. Unsuccessful bidders will receive a refund of their deposit. As to the successful bidder, the deposit will be nonrefundable, and will be credited to the purchase price. The successful bidder will be required to sign a purchase and sale agreement. The balance of the purchase price will be due and payable on or before January 5, 2015. Other terms and conditions pertaining to the sale may be announced at the time of the sale. Interested bidders are urged to contact the following for further details: KEENAN AUCTION COMPANY One Runway Road South Portland, Maine 04106 Tel: (207) 885-5100 E-mail: info@keenan auction.com Androscoggin Savings Bank is represented by Norman J. Rattey, Esq. PINNACLE ENTERTAINMENT: To Spin Off REIT At Investor's Behest ------------------------------------------------------------- Ronald Orol, writing for The Deal, reported that under pressure from activist investor Orange Capital LLC's Daniel Lewis, casino operator Pinnacle Entertainment Inc. announced it plans to separate its real estate assets from its operating assets. According to the report, Pinnacle said it plans to create a Real Estate Investment Trust, or REIT, for its real estate that will be distributed to the company's existing shareholders in a tax-free spinoff. In addition, "substantially" all of the real estate will be leased back to Pinnacle, which currently owns and operates 15 gaming properties in eight states, and the new REIT will have a mandate to make real estate acquisitions in the "gaming, leisure and entertainment industries," the report added. About Pinnacle Entertainment Pinnacle Entertainment, Inc., owns, operates and develops casinos and related hospitality and entertainment facilities. The Las Vegas-based Company currently owns and operates 15 gaming entertainment properties located in Colorado, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada and Ohio. The Troubled Company Reporter, on July 17, 2014, reported that Fitch Ratings has affirmed Pinnacle Entertainment, Inc.'s (PNK; Pinnacle) Issuer Default Rating (IDR) at 'B+'. Fitch also affirmed all of Pinnacle's issue ratings including the senior secured credit facility at 'BB+/RR1', senior unsecured notes at 'BB-/RR3' and subordinated notes at 'B-/RR6'. The Rating Outlook is Stable. POSITIVEID CORP: Signs $234,500 Securities Purchase Agreements -------------------------------------------------------------- PositiveID Corporation closed a securities purchase agreement with Blue Citi, LLC, providing for the purchase of a Convertible Promissory Note in the principal amount of $161,000, according to a regulatory filing with the U.S. Securities and Exchange Commission. Note I contains an $11,000 original issue discount to cover legal and due diligence fees such that the cash proceeds received on the closing of Note I is $150,000. The Company also issued a warrant in connection with Note I, providing for the purchase 1,000,000 shares of Company common stock with an exercise price of $0.08 per share. That warrant has no price or quantity resets. Note I bears interest at the rate of 8% per annum; is due and payable on Oct. 27, 2015; and may be converted by Blue Citi at any time after 180 days of the date of closing into shares of Company common stock at a conversion price equal to a 40% discount of the average of the three lowest closing bid prices calculated at the time of conversion. Note I also contains certain representations, warranties, covenants and events of default, and increases in the amount of the principal and interest rates under Note I in the event of such defaults. On Oct. 27, 2014, the Company also closed a Securities Purchase Agreement with LG Capital Funding, LLC, providing for the purchase of two Convertible Redeemable Notes in the aggregate principal amount of $73,500, with the first note being in the amount of $36,750 and the second note being in the amount of $36,750. The first Note II was funded on Oct. 27, 2014, with the Company receiving $33,250 of net proceeds (net of legal and due diligence fees), and the second Note II was initially issued in exchange for the issuance of an offsetting $36,750 secured note, issued by LG Capital to the Company. The funding of the second Note II is subject to certain conditions as set forth in the second Note II. The Notes II bear interest at the rate of 8% per annum; are due and payable on Oct. 21, 2015; and may be converted by LG Capital at any time after 180 days of the date of closing into shares of Company common stock at a conversion price equal to a 40% discount of the lowest closing bid price (as set forth in Notes II) calculated at the time of conversion. Notes II also contain certain representations, warranties, covenants and events of default, and increases in the amount of the principal and interest rates under Note II in the event of those defaults. About PositiveID Delray Beach, Fla.-based PositiveID Corporation has historically developed, marketed and sold RFID systems used for the identification of people in the healthcare market. Beginning in early 2011, the Company has focused its strategy on the growth of its HealthID business, including the continued development of its GlucoChip, its Easy Check breath glucose detection device, its iglucose wireless communication system, and potential strategic acquisition opportunities of businesses that are complementary to its HealthID business. PositiveID reported a net loss attributable to common stockholders of $13.33 million on $0 of revenue for the year ended Dec. 31, 2013, as compared with a net loss attributable to common stockholders of $25.30 million on $0 of revenue in 2012. As of June 30, 2014, the Company had $1.19 million in total assets, $6.98 million in total liabilities, all current, $1.21 million in mandatorily redeemable preferred stock and a $6.99 million total stockholders' deficit. EisnerAmper LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has a working capital deficiency and an accumulated deficit. Additionally, the Company has incurred operating losses since its inception and expects operating losses to continue during 2014. These conditions raise substantial doubt about its ability to continue as a going concern. PRAYOSHA 1 INC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Prayosha 1, Inc. dba Super 8 fka Prayosha, Inc. 417 Historic Nature Trail Gatlinburg, TN 37738 Case No.: 14-51827 Nature of Business: Single Asset Real Estate Chapter 11 Petition Date: November 5, 2014 Court: United States Bankruptcy Court Eastern District of Tennessee (Greeneville) Judge: Hon. Marcia Phillips Parsons Debtor's Counsel: C. Dan Scott, Esq. SCOTT LAW GROUP, PC 209 Chilhowee School Rd., Ste. 16 Seymour, TN 37865 Tel: (865) 246-1050 Fax: (865)246-1054 Email: dan@scottlawgroup.com Total Assets: $3.08 million Total Liabilities: $3.87 million The petition was signed by Ishver T. Patel, president. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/tneb14-51827.pdf PRESSURE BIOSCIENCES: Presented at FSXinterlinked Conference ------------------------------------------------------------ Pressure Biosciences, Inc., presented at the FSXinterlinked Investor Conference on Oct. 29, 2014. The Company discussed about, among other things: * Company overview, management and board; * completion of the 1st phase of Barozyme HT48 commercialization plan - first install expected in october 2014; * invitation to speak at Warsaw Stock Exchange; and * partnership with Powertech Technology Company to develop China market for PBI's PCT platform. Prof. Ruedi Aebersold, Institute of Molecular Systems Biology, ETH Zurich, Switzerland, said, "Working with SB SCIEX we developed a new and improved mass spectrometry method called SWATH, which when combined with PCT and consumables (including the u-Pestle) resulted in significantly improved protein data from needle biopsy samples. We believe PCT SWATH will lead to better analysis of needle biopsy samples in both clinical and research settings, leading to advances in personalized medicine, especially cancer diagnosis and treatment." A copy of the presentation is available at http://is.gd/6he8nZ About Pressure Biosciences Pressure BioSciences, Inc., headquartered in South Easton, Massachusetts, holds 14 United States and 10 foreign patents covering multiple applications of pressure cycling technology in the life sciences field. Pressure Biosciences reported a net loss applicable to common shareholders of $5.24 million on $1.50 million of total revenue for the year ended Dec. 31, 2013, as compared with a net loss applicable to common stockholders of $4.40 million on $1.23 million of total revenue in 2012. As of June 30, 2014, the Company had $1.48 million in total assets, $2.75 million in total liabilities, and a $1.27 million total stockholders' deficit. Marcum LLP, in Boston, Massachusetts, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has had recurring net losses and continues to experience negative cash flows from operations. The auditors said these conditions raise substantial doubt about its ability to continue as a going concern. RECYCLE SOLUTIONS: Section 341(a) Meeting Scheduled for Dec. 1 -------------------------------------------------------------- A meeting of creditors in the bankruptcy case of Recycle Solutions, Inc., has been set for Dec. 1, 2014, at 10:00 a.m., 200 Jefferson Avenue, Suite 400, in Memphis, Tennessee. 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. Recycle Solutions, Inc., filed a Chapter 11 bankruptcy petition (Bankr. W.D. Tenn. Case No. 14-31338) on Nov. 4, 2014. The petition was signed by James Downing as president. Judge George W. Emerson Jr. is assigned to the case. The Debtor disclosed total assets of $11.54 million and total liabilities of $6.39 million. Harris Shelton Hanover Walsh, PLLC, serves as the Debtor's counsel. REVEL AC: Wants Contract With Chief Operations Officer Rejected --------------------------------------------------------------- Revel AC, Inc. has filed a motion seeking court approval to reject an employment agreement between Revel Entertainment Group LLC and its chief operating officer. The move comes after Scott Kreeger on Oct. 16 resigned from his position as Revel Entertainment's chief operating officer. Mr. Kreeger accepted a job offer from another employer, according to the court filing. Revel AC wants the employment agreement rejected nunc pro tunc to Oct. 16. The U.S. Bankruptcy Court for the District of New Jersey will hold a hearing on Nov. 13 to consider the request. Objections are due by Nov. 6. 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. REVEL AC: 5th Interim Order Authorizing DIP Financing Entered ------------------------------------------------------------- U.S. Bankruptcy Judge Gloria Burns entered a fifth amended interim order authorizing Revel AC, Inc. and its affiliated debtors to obtain post-petition financing and use cash collateral. The bankruptcy judge will consider final approval of the DIP facility at a hearing scheduled for Nov. 13, at 10:00 a.m. (EST) at the U.S. Bankruptcy Court for the District of New Jersey. A copy of the court order is available without charge at http://bankrupt.com/misc/Revel_5th_Interim_DIP_Order.pdf 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. ROOSTER ENERGY: Moody's Withdraws Caa1 Corporate Family Rating -------------------------------------------------------------- Moody's Investors Service has withdrawn all ratings for Rooster Energy Ltd., including its proposed $100 million senior secured notes. The senior notes offering was not completed. Ratings withdrawn: Issuer: Rooster Energy Ltd. Caa1 Corporate Family Rating, withdrawn Caa1-PD Probability of Default Rating, withdrawn SGL-3 Speculative Grade Liquidity Rating, withdrawn Caa1 (LGD 4, 57%) Senior Secured Notes Rating, withdrawn Stable Outlook, withdrawn Ratings Rationale Rooster Energy Ltd. (Rooster) is a Gulf of Mexico shallow water focused publicly traded oil and gas E&P company with a significant well decommissioning business. SACHIDANAND INVESTMENTS: Case Summary & 14 Top Unsec. Creditors --------------------------------------------------------------- Debtor: Sachidanand Investments, Inc. fdba Days Inn dba Travel Inn 3670 Roy Messer Hwy White Pine, TN 37890 Case No.: 14-51825 Nature of Business: Single Asset Real Estate Chapter 11 Petition Date: November 5, 2014 Court: United States Bankruptcy Court Eastern District of Tennessee (Greeneville) Judge: Hon. Marcia Phillips Parsons Debtor's Counsel: Barry W. Eubanks, Esq. SCOTT AND EUBANKS, PC 209 Chilhowee School Rd., Ste. 16 Seymour, TN 37865 Tel: 865 -246-1050 Email: barry@scottlawgroup.com Total Assets: $2.10 million Total Liabilities: $4.29 million The petition was signed by Ishver T. Patel, president. A list of the Debtor's 14 largest unsecured creditors is available for free at http://bankrupt.com/misc/tneb14-51825.pdf SAMUEL WYLY: SEC Slams Tycoon's Bankruptcy Budget as "Staggering" ----------------------------------------------------------------- Joseph Ax and Nate Raymond, writing for Reuters, reported that a lawyer for the U.S. Securities and Exchange Commission criticized Texas tycoon Sam Wyly's proposed bankruptcy budget as "staggering." According to the report, items in Mr. Wyly's budget include $32,000 a month for assistants to help him write his books and nearly $7,000 a month to support elderly friends and family members. "We are concerned that the debtor is attempting to deplete domestic assets and making it harder for U.S. creditors to collect," Angela Dunn, an SEC lawyer, said, Reuters cited. About Samuel Wyly Samuel Wyly filed for Chapter 11 bankruptcy protection on Oct. 19, 2014, weeks after a judge ordered him to pay several hundred million dollars in a civil fraud case. In September, a federal judge ordered Mr. Wyly and the estate of his deceased brother to pay more than $300 million in sanctions after they were found guilty of committing civil fraud to hide stock sales and nab millions of dollars in profits. The case is In re Samuel E. Wyly, 14-35043, U.S. Bankruptcy Court, Northern District of Texas (Dallas). SAMUEL WYLY: NY Judge Freezes Billionaire's Foreign Accounts ------------------------------------------------------------ Katy Stech, writing for Daily Bankruptcy Review, reported that U.S. District Judge Shira Scheindlin in New York issued an order freezing the assets of former billionaire Samuel Wyly to prevent transfers from his offshore accounts on the Isle of Man to family members -- a flow that the U.S. Securities and Exchange Commission argued could deplete the pool of money they are trying collect to pay a $200 million judgment for securities fraud. Judge Scheindlin, in October, also issued an order freezing Mr. Wyly's assets the day after he filed for bankruptcy in Texas in order to "preserve the status quo." In her October order, Judge Scheindlin said the while the assets at issue might be property of Mr. Wyly's Chapter 11 estate, an injunction was necessary to preserve the SEC's ability to collect on any eventual judgment. About Samuel Wyly Samuel Wyly filed for Chapter 11 bankruptcy protection on Oct. 19, 2014, weeks after a judge ordered him to pay several hundred million dollars in a civil fraud case. In September, a federal judge ordered Mr. Wyly and the estate of his deceased brother to pay more than $300 million in sanctions after they were found guilty of committing civil fraud to hide stock sales and nab millions of dollars in profits. The case is In re Samuel E. Wyly, 14-35043, U.S. Bankruptcy Court, Northern District of Texas (Dallas). SAN BERNARDINO, CA: Allowed to Reject Firefighters' CBA ------------------------------------------------------- Judge Meredith A. Jury of the U.S. Bankruptcy Court Central District of California, Riverside Division, allowed city of San Bernardino to reject its collective bargaining agreement with the city's firefighter union, saying "the balance of equities favor rejection of the CBA, given the substantial benefit to the city and its financial rehabilitation versus the relatively modest impact on the firefighers associated with the city's implementation of certain new terms and conditions of employment, particularly when the other unions of the city have agreed to concessions which impact their employees' take home pay." According to Judge Jury, the City's evidence on the financial burden of the contract was entirely unrebutted by any admissible evidence presented by the San Bernardino City Professional Firefighters, who chose to not present any expert testimony to counter the testimony of Michael Busch, the president and CEO of Urban Futures, Inc., the City's financial consultant. Mr. Busch has stated during the three-day trial on the issue in April that the cost savings, estimated to be $3.7 million in fiscal year 2014-2015, in rejecting the SBCPF CBA were critical to the implementation of the city's pendency plan and the city's ability to propose a confirmable plan of adjustment and that absent the rejection of the police, fire and middle management memorandum of understanding, the City could not successfully implement its Pendency Plan. A full-text copy of Judge Jury's findings of fact and conclusions of law dated Nov. 4, 2014, is available at http://is.gd/NzSu0F About San Bernardino, Calif. San Bernardino, California, filed an emergency petition for municipal bankruptcy under Chapter 9 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 12-28006) on Aug. 1, 2012. San Bernardino, a city of about 210,000 residents roughly 65 miles (104 km) east of Los Angeles, estimated assets and debts of more than $1 billion in the bare-bones bankruptcy petition. The city council voted on July 10, 2012, to file for bankruptcy. The move lets San Bernardino bypass state-required mediation with creditors and proceed directly to U.S. Bankruptcy Court. The city is represented that Paul R. Glassman, Esq., at Stradling Yocca Carlson & Rauth. San Bernardino joined two other California cities in bankruptcy: Stockton, an agricultural center of 292,000 east of San Francisco, and Mammoth Lakes, a mountain resort town of 8,200 south of Yosemite National Park. The City was granted Chapter 9 protection on Aug. 28, 2013. SCIENTIFIC GAMES: S&P Assigns 'BB-' Rating on New $700MM Sr. Notes ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned New York-based Scientific Games Corp.'s subsidiary Scientific Games International Inc.'s proposed new $700 million senior secured notes due 2021 an issue-level rating of 'BB-' (one notch above the corporate credit rating), with a recovery rating of '2', indicating S&P's expectation for substantial (70% to 90%) recovery for lenders in the event of a payment default. S&P also assigned Scientific Games International Inc.'s proposed $2.2 billion senior unsecured notes due 2022 an issue-level rating of 'B' (one notch below the corporate credit rating), with a recovery rating of '5', indicating S&P's expectation for modest (10% to 30%) recovery for lenders in the event of a payment default. S&P's issue-level and recovery ratings on the company's senior secured credit facility remain unchanged despite an additional $250 million in incremental term loan B-2 proceeds that are expected to be committed concurrent with the notes issuance. The incremental proceeds bring the total size of the term loan B-2 to $2.25 billion. S&P rates the company's senior secured credit facility, which consists of a $568 million revolver due 2018, a $2.3 billion existing term loan due 2020, and the new term loan B- 2, 'BB-'. The recovery rating remains '2'. The company plans to use proceeds from the term loan B-2, the revolver, the expected senior secured and unsecured notes issuances, and cash on hand at both companies to fund the approximately $3.2 billion purchase price for Bally Technologies Inc., to refinance about $1.8 billion in net debt at Bally, and to pay for transaction fees and expenses. S&P's 'B+' corporate credit rating and stable rating outlook on Scientific Games Corp. are unchanged. S&P affirmed the corporate credit rating on Scientific Games and removed all ratings from CreditWatch on Sept. 3, 2014, following S&P's assessment of the acquisition. The rating reflects S&P's assessment of the company's business risk profile as "satisfactory" and its financial risk profiles as "highly leveraged", pro forma for the completion of the acquisition of Bally. Following the acquisition, S&P believes the company will be the second largest global gaming and lottery company in terms of revenue, compared to third or fourth as stand-alone companies. S&P expects the company will maintain its good position in the U.S. instant ticket market (Scientific Games supplies 39 of the 44 U.S. jurisdictions that sell instant lottery games) and lottery market (Scientific Games has contracts to operate 9 of the 46 U.S. jurisdictions that operate draw lotteries). The acquisition also enhances the company's already good level of recurring revenue given a large portion of Bally's revenue is derived from licensing and service revenue for casino management systems (that have high retention rates given switching costs), from licensing the company's table products, and in part from servicing or leasing gaming machines. Scientific Games also benefits from recurring revenue from long term lottery contracts with jurisdictions for printed products and lottery systems. S&P's financial risk assessment reflects its expectation for adjusted leverage, pro forma for the completion of the acquisition and related financing, to remain high, in the low- to mid-7x area, through 2015. S&P also expects adjusted funds from operations (FFO) to debt to remain in the high-single-digit percent area through 2016. Offsetting high leverage and low FFO to debt is S&P's expectation for EBITDA coverage of interest to remain good, in the low-2x area. S&P's measure of EBITDA includes cash distributions from entities accounted for under the equity method, and adjusts for S&P's expectation for synergies. RECOVERY ANALYSIS Key analytical factors: -- S&P's recovery ratings on Scientific Games' senior secured credit facility and subordinated notes are unchanged at '2' and '6', respectively. S&P's simulated default scenario contemplates a payment default in 2018, attributable to lower than expected achievement of synergies related to the acquisition of Bally, and a prolonged economic downturn that reduces consumer spending on gaming, extends the gaming equipment replacement cycle, and reduces spending on new equipment. S&P assumes a reorganization of Scientific Games under a distressed scenario. Simulated default and valuation assumptions: -- Year of default: 2018 Simplified waterfall: -- Net enterprise value (after 7% admin. costs): $5.0 bil. -- Net value available to secured facilities: $4.38 bil. -- Senior secured debt: $6.0 bil. -- Recovery expectations: 70%-90% -- Net value available to unsecured facilities: $615 mil. -- Senior unsecured debt: $2.3 bil. -- Recovery expectations: 10%-30% -- Net value available to subordinated facilities: $0 -- Subordinated debt: $931 mil. -- Recovery expectations: 0%-10% Note: All debt amounts include six months of prepetition interest. N/A--Not applicable. RATINGS LIST Scientific Games Corp. Corporate credit rating B+/Stable/-- Ratings Assigned Scientific Games International Inc. Senior secured $700 mil. notes due 2021 BB- Recovery rating 2 Senior unsecured $2.2 bil. notes due 2022 B Recovery rating 5 SCIENTIFIC GAMES: Files Third Quarter Form 10-Q With SEC -------------------------------------------------------- Scientific Games Corporation filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss of $69.8 million on $415.6 million of total revenue for the three months ended Sept. 30, 2014, compared to a net loss of $500,000 on $234.4 million of total revenue for the same period during the prior year. The Company also reported a net loss of $187.2 million on $1.22 billion of total revenue for the nine months ended Sept. 30, 2014, compared to a net loss of $26.7 million on $689 million of total revenue for the same period in 2013. As of Sept. 30, 2014, the Company had $4.03 billion in total assets, $3.93 billion in total liabilities and $105.7 million in total stockholders' equity. "We believe that our cash flow from operations, available cash and equivalents and available borrowing capacity under our revolving credit facility will be sufficient to meet our liquidity needs for the foreseeable future; however, there can be no assurance that this will be the case. We believe that substantially all cash held outside the U.S. is free from legal encumbrances or similar restrictions that would prevent it from being available to meet our global liquidity needs," the Company stated in the filing. A copy of the Form 10-Q is available for free at: http://is.gd/ciDNNr About Scientific Games Scientific Games Corporation is a developer of technology-based products and services and associated content for worldwide gaming and lottery markets. The Company's portfolio includes instant and draw-based lottery games; electronic gaming machines and game content; server-based lottery and gaming systems; sports betting technology; loyalty and rewards programs; and social, mobile and interactive content and services. For more information, please visit: www.scientificgames.com. Scientific Games reported a net loss of $30.2 million in 2013, a net loss of $62.6 million in 2012 and a net loss of $12.6 million in 2011. * * * The TCR reported on May 21, 2014, that Moody's Investors Service downgraded Scientific Games Corporation's ("SGC") Corporate Family Rating to B1. The downgrade reflects Moody's view that slower than expected growth in SGC's Gaming and Instant Products segments will cause Moody's adjusted leverage to exceed 6.0 times by the end of 2014. As reported by the TCR on Aug. 5, 2014, Standard & Poor's Ratings Services lowered its corporate credit rating to 'B+' from 'BB-' on Scientific Games Corp. "The downgrade and CreditWatch placement follow Scientific Games' announcement that it has agreed to acquire Bally Technologies for $5.1 billion, including the refinancing of about $1.8 billion in net debt at Bally," said Standard & Poor's credit analyst Ariel Silverberg. SEVEN GENERATIONS: Moody's Hikes Corporate Family Rating to B2 -------------------------------------------------------------- Moody's Investors Service upgraded Seven Generations Energy Ltd.'s (7G) Corporate Family Rating (CFR) to B2 from B3, Probability of Default Rating to B2-PD from B3-PD and senior unsecured notes rating to B3 from Caa1. The rating outlook was changed to positive from stable. Moody's affirmed the SGL-3 Speculative Grade Liquidity Rating. "The upgrade to B2 and positive outlook reflect Moody's view that Seven Generations' production base will become significantly larger in 2015 with margins remaining solid," said Paresh Chari, Moody's Analyst, "The proceeds from the IPO will largely support the very large capex plan in 2015, keeping leverage strong." Issuer: Seven Generations Energy Ltd Upgrades: Probability of Default Rating, Upgraded to B2-PD from B3-PD Corporate Family Rating, Upgraded to B2 from B3 Senior Unsecured Regular Bond/Debenture, May 15, 2020, Upgraded to B3(LGD5) from Caa1(LGD4) Outlook Actions: Outlook, Changed To Positive From Stable Affirmations: Speculative Grade Liquidity Rating, Affirmed SGL-3 Rating Rationale The B2 CFR reflects 7G's concentration in a single field and a single formation, high decline rates that require a large capex program to offset and a very large growth capex program to develop its large proved undeveloped reserve base, which entails significant execution risk. The rating favorably recognizes the company's significant total proved reserves base, advanced development plans and Moody's expectation that its liquids production, specifically condensate, will allow cash flows to grow to levels supportive of the rating in 2015. 7G's SGL-3 rating reflects its adequate liquidity. Pro forma for the C$880 million November 2014 IPO, 7G will have about C$1 billion of cash and a fully available C$480 million borrowing base revolving credit facility (September 2017 maturity). From September 30, 2014 to December 31, 2015, Moody's expect negative free cash flow of about C$1.3 billion, which will be funded from cash and revolver draws. There are no debt maturities until 2020. Alternate liquidity is limited given that substantially all of the company's assets are pledged under the borrowing base revolver. In accordance with Moody's Loss Given Default methodology, the US$700 million senior unsecured notes are rated one notch below the B2 CFR because of the existence of the prior-ranking C$480 million secured revolver. The positive outlook reflects Moody's expectation that production will increase significantly through 2015, improving leverage. The rating could be upgraded if 7G executes on its development plan increasing production towards 40,000 boe/d with about 35% coming from condensate, while maintaining retained cash flow to debt above 30% and E&P debt to production below US$35,000/boe. The rating could be downgraded if 7G's production decreases materially or if debt funded negative free cash flow leads to retained cash flow to debt falling below 15% or E&P debt to production increasing above US$50,000/boe. Seven Generations Energy Ltd. is a Calgary, Alberta-based exploration and production company with approximately 23 million and 297 million barrels of equivalent oil (boe) of net proved developed and total proved reserves, respectively, and average daily production of 20,000 boe/d (net of royalties) for the first half of 2014. The principal methodology used in these ratings was Global Independent Exploration and Production Industry published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. SHASTA ENTERPRISES: Secured Creditor Won't Consent to Cash Use -------------------------------------------------------------- Redding Bank of Commerce filed with the U.S. Bankruptcy Court for the Eastern District of California, Sacramento Division, a notice of perfection of interest in Shasta Enterprises' real properties and non-consent to use of cash collateral. Redding, a secured creditor, says it holds a security interest in the real properties commonly described as 250 Hemsted Drive, 355 Hemsted Drive, and 381, 391, 393 & 401 Hemsted Drive, in Redding, County of Shasta, California. The bank says its security interests, which extend to the rents, issues, profits, proceeds, product and offspring of the real property collateral, were and are fully perfected prior to the Petition Date. The bank says it doesn't consent to the Debtor's use of cash collateral, which include some or all of the rents, issues, profits, proceeds, product and offspring of the real property collateral. Redding is represented by: Walter R. Dahl, Esq. Andrew Brian Reisinger, Esq. DAHL LAW, ATTORNEYS AT LAW 2304 "N" Street Sacramento, CA 95816-5716 Tel: (916) 446-8800 E-mail: wdahl@DahlLaw.net abreisinger@DahlLaw.net About Shasta Enterprises Redding, California-based Shasta Enterprises, dba Vidal Vineyards, dba Silverado Knolls, dba Villa Vidal Vineyards, sought bankruptcy protection on Oct. 31, 2014 (Case No. 14-30833, Bankr. E.D. Cal.). The case is before Judge Michael S. McManus. The Debtor's counsel is represented by David M. Brady, Esq., at Law Office of Cowan & Brady, in Redding, California. The Debtor lists total assets of $33.42 million and total debts of $21.49 million. The petition was signed by Antonio Rodriguez, general partner. SHASTA ENTERPRISES: Section 341(a) Meeting Set for Dec. 5 --------------------------------------------------------- A meeting of creditors in the bankruptcy case of Shasta Enterprises is scheduled for Dec. 5, 2014, at 1:30 p.m. at Office of the UST (7-500). Proofs of claim are due by March 3, 2015. 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. Shasta Enterprises filed a Chapter 11 bankruptcy petition (Bankr. E.D. Cal. Case No. 14-30833) on Oct. 31, 2014. Antonio Rodriguez signed the petition as general partner. Judge Michael S. McManus presides over the case. The Law Office of Cowan & Brady serves as the Debtor's counsel. The Debtor disclosed total assets of $33.42 million and total liabilities of $21.49 million. SHELBOURNE NORTH: Related Midwest Takes Control of Chicago Spire ---------------------------------------------------------------- Joseph D. Frank, Esq., who represents Chicago Spire developer Garrett Kelleher, confirmed Tuesday that his client handed over the development site at 400 N. Lake Shore Drive to Related Midwest LLC, after failing to make a required payment in October, David Lee Matthews, writing for Chicagobusiness.com. Chicagobusiness.com relates that Mr. Kelleher's venture had until the end of October to pay Related Midwest more than $109 million. The report says that the deadline could have been extended to March 2015 by paying a $22 million fee and increasing Related Midwest's claim, but Mr. Kelleher's lawyer told city officials the venture was unlikely to secure enough funding to make any payment. Chicagobusiness.com recalls that Mr. Kelleher found a local partner, Steven Ivankovich of Atlas Apartment Holdings LLC, to help secure the funding necessary to exit bankruptcy. "Unfortunately we just ran out of time to get everything documented and processed with our lender," Mr. Ivankovich said in a statement. According to Mary Ellen Podmolik at Chicago Tribune, Related Midwest on Monday night withdrew after it received the deed to the Chicago Spire site a motion it had filed on Saturday in U.S Bankruptcy Court to compel Shelbourne to turn over the paperwork. Related Midwest has not disclosed its intentions for the property, Chicago Tribune reports. About Shelbourne North Water Street A group of creditors filed an involuntary Chapter 11 petition against Chicago, Illinois-based Shelbourne North Water Street L.P. (Bankr. D. Del. Case No. 13-12652) on Oct. 10, 2013. The case is assigned to Judge Kevin J. Carey. The petitioners are represented by Zachary I Shapiro, Esq., and Russell C. Silberglied, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware. The Debtor consented on Nov. 8, 2013, to being in Chapter 11 reorganization. FrankGecker LLP represents the Debtor in its restructuring effort. SIAG AERISYN: $2.6MM Clawback Suit Against SSAB Goes to Trial ------------------------------------------------------------- The avoidance action filed by the trustee for SIAG Aerisyn, LLC against SSAB Enterprises, LLC will proceed to trial after Bankruptcy Judge Shelleyn D. Rucker tossed the defendant's motion for partial summary judgment. The Trustee seeks to avoid $2,598,921.90 in transfers made by the Debtor to SSAB pursuant to 11 U.S.C. Sec. 550(a). SSAB seeks partial summary judgment regarding whether the amount of $9,901,399 provided to the Debtor by an affiliated company, SIAG Schaaf Industrie AG, constituted a loan that was debt the Debtor owed or constituted equity that affected the Debtor's solvency for bankruptcy purposes. The adversary proceeding was originally filed by the Debtor. The Court substituted the trustee, James R. Paris, as plaintiff by agreed order on August 14, 2013. The Complaint asserts that the Debtor made transfers of property to SSAB in the form of payments within the ninety-day period of the filing of the Debtor's bankruptcy petition. The Complaint further contends that the payments were made to SSAB as a creditor for or on account of an antecedent debt and that the payments allowed SSAB to receive more than it would have received if the case were a Chapter 7 bankruptcy case. The Trustee further alleges that the Debtor was insolvent at the time of the transfer. The Trustee argues that the Debtor had a contract with REpower Systems AG dated December 1, 2011, and that under that contract, REpower advanced SIAG $8.3 million. However, the Debtor only acknowledged $2 million of the $8.3 million owed to REpower in its bankruptcy schedules. Therefore, the Trustee contends that even if the $9.9 million advance from SIAG Schaaf was an equity investment, SIAG was still insolvent due to another $6.3 million in liabilities that were unaccounted for in its bankruptcy schedules. SSAB has made clear that its motion for partial summary judgment does not address the alleged REpower debt. According to Judge Rucker, genuine issues of material fact remain regarding whether the approximately $9.9 million in advances provided by SIAG Schaaf to the Debtor constituted loans or equity investments for purposes of the insolvency analysis relating to the Trustee's preference claim pursuant to 11 U.S.C. Sec. 547(b). Therefore, SSAB's motion for partial summary judgment will be denied. The case is, JAMES R. PARIS, Trustee, Plaintiff, v. SSAB ENTERPRISES, LLC, Defendant, Adv. Proc. No. 13-1040 (Bankr. E.D. Tenn.). A copy of the Court's November 3, 2014 Memorandum is available at http://bit.ly/10Tq70xfrom Leagle.com. About SIAG Aerisyn SIAG Aerisyn LLC, aka Aerisyn LLC, filed a Chapter 11 petition (Bankr. E.D. Tenn. Case No. 12-11705) on April 2, 2012, in its hometown in Chattanooga, Tennessee. The Debtor manufactures wind towers essential for wind turbines as alternative energy sources. The plant is located in Chattanooga, employing roughly 84 persons. Judge Shelley D. Rucker presides over the case. Samples, Jennings, Ray & Clem, PLLC, serves as the Debtor's Chapter 11 counsel. Wormser, Kiely, Galef & Jacobs, LLP, serves as special counsel. Jerome Luggen of Cincinnati Industrial Auctioneers, Inc., was tapped as appraiser of the Debtor's equipment. The Debtor estimated up to $50 million in assets and debts. In its schedules, the Debtor disclosed $18,728,994 in total assets and $24,261,855 in total liabilities. As reported by the Troubled Company Reporter on July 9, 2013, at the Debtor's behes, the Bankruptcy Court converted the Debtor's Chapter 11 case to one under Chapter 7 of the Bankruptcy Code. SIGA TECHNOLOGIES: Posts $240,076,761 Net Loss for Sept. 30 Qtr --------------------------------------------------------------- SIGA Technologies, Inc. filed with the Securities and Exchange Commission its report on Form 10-Q for the quarterly period ended September 30, 2014. SIGA listed total assets of $164,715,384 against total liabilities of $392,691,893 at Sept. 30, 2014. Total stockholders' deficit is $227,976,509. SIGA said revenues from research and development is $1,099,429 for the three months ended Sept. 30, 2014, compared to $2,292,143 for the same period in 2013. Revenues were $2,299,456 for the nine months ended, compared to $4,585,174 for the same period last year. SIGA posted a net and comprehensive loss of $240,076,761 for the three months ended Sept. 30, 2014, compared to $4,901,976 for the same period in 2013. Net and comprehensive loss of $246,406,883 for the nine months ended Sept. 30, 2014, compared to $12,838,876 for the same period in 2013. A copy of the Form 10-Q Report is available at http://1.usa.gov/1xeFGfi The Company commenced the chapter 11 case to preserve and to assure its ability to satisfy its commitments under the Biomedical Advanced Research and Development Authority Contract and to preserve its operations, which would have likely been jeopardized by the enforcement of a judgment stemming from the pending litigation with PharmAthene, Inc. The chapter 11 filing will allow the Company to continue to perform under the BARDA Contract, and to pursue what it believes is a meritorious appeal of the pending Delaware Chancery Court proceeding, without the necessity of posting a bond. On August 8, 2014, the Delaware Court of Chancery issued its Remand Opinion and related order in the litigation initiated against the Company in 2006 by PharmAthene, Inc. In the Remand Opinion, the Court of Chancery determined, among other things, that PharmAthene is entitled to a lump sum damages award in an as yet unspecified amount, with interest and fees, based on United States government purchases of the Company's smallpox drug allegedly anticipated as of December 2006. The amount of the total judgment to be decreed by the Court of Chancery is expected to be substantial, and enforcement of that judgment by PharmAthene would have jeopardized the Company's viability and ability to produce and deliver Tecovirimat and to continue research and development activities for Tecovirimat. The chapter 11 case prevents PharmAthene from taking any enforcement action at this time and also will permit the Company's intended appeal of the Remand Opinion to go forward without the need to post a bond. On September 17, 2014, the Company received Bankruptcy Court approval of certain "first-day" motions which preserve the Company's ability to continue operations without interruption in chapter 11. As part of the "first-day" motions, the Company received approval to pay or otherwise honor certain pre-petition obligations generally designed to support the Company's operations. Additionally, the Bankruptcy Court confirmed the Company's authority to pay for goods and services received post- petition in the ordinary course of business. As part of the chapter 11 case, the Company has retained, pursuant to Bankruptcy Court approval, legal and financial professionals to advise the Company in connection with the administration of its chapter 11 case and its litigation with PharmAthene, and certain other professionals to provide services and advice in the ordinary course of business. From time to time, the Company may seek Bankruptcy Court approval to retain additional professionals. In October, the U.S. Trustee for the Southern District of New York appointed an official committee of unsecured creditors. The UCC has a right to be heard on all matters affecting the Company that come before the Bankruptcy Court. There can be no assurance that the UCC will support the Company?s positions on matters to be presented to the Bankruptcy Court in the future or on any plan of reorganization, once proposed. The Company has not yet prepared or filed a plan of reorganization with the Bankruptcy Court. The Company has the exclusive right to file a plan of reorganization through and including January 14, 2015, and to solicit votes on such a plan if filed by such date through and including March 16, 2015, subject to the ability of parties in interest to file motions seeking to terminate the Company's exclusive periods, as well as the Company's right to seek further extensions of such periods. The Company has the right to seek further extensions of such exclusive periods, subject to the statutory limit of 18 months from the Petition Date in the case of filing a plan and 20 months in the case of soliciting and obtaining acceptances of such a plan. Implementation of a plan of reorganization is subject to confirmation of the plan by the Bankruptcy Court in accordance with the provisions of the Bankruptcy Code, and the occurrence of the effective date under the plan. At this time, there is no certainty as to when or if a plan will be filed, the provisions of a plan, or whether a plan will be confirmed and consummated. About SIGA Technologies Publicly held SIGA Technologies, Inc., with headquarters in Madison Avenue, New York, is a biotech/pharmaceutical company that specializes in the development and commercialization of solutions for serious unmet medical needs and biothreats. SIGA's lead product is Tecovirimat, also known as ST-246, an orally administered antiviral drug that targets orthopoxviruses. SIGA sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 14-12623) on Sept. 16, 2014, in Manhattan. The case is assigned to Judge Sean H. Lane. The Debtor has tapped Weil, Gotshal & Manges LLP, as counsel, and Prime Clerk LLC as claims agent. According to the docket, the schedules of assets and liabilities and the statement of financial affairs are due Sept. 30, 2014. The Debtor's Chapter 11 plan and disclosure statement are due Jan. 14, 2015. The initial case conference is due by Oct. 16, 2014. As of June 30, 2014, SIGA reported consolidated assets and liabilities of $209 million and $198 million, respectively. The amount of reported liabilities does not include any amount attributable to the lawsuit filed by PharmAthene, Inc. A total of $2.50 million is outstanding on a secured term loan with General Electric Capital Corp. Trade payables total $3.3 million. SIGA TECHNOLOGIES: Stipulation on Cash Use Has Final Approval ------------------------------------------------------------- The U.S. Bankruptcy Court on September 17, 2014, approved on an interim basis a Stipulation and Order between SIGA Technologies, Inc. and General Electric Capital Corporation, in its capacity as Agent for the lenders under the loan agreement dated December 31, 2012, in connection with the chapter 11 case. The Loan Agreement, consisting of a term loan and revolving line of credit, is a fully secured loan facility. As of the Petition Date, $2.5 million of the term loan was outstanding and no amount was borrowed or outstanding against the revolving line of credit. Pursuant to the Stipulation and Order: -- The Company can continue to use cash as to which the Agent has a lien; -- The Company will continue to make its regularly scheduled interest (at the non-default rate) and amortization payments on the term loan under the Loan Agreement; -- The revolving loan commitment under the Loan Agreement, as to which no borrowings are outstanding, was terminated; -- The Company paid $70,000 to GE in full satisfaction of all amounts payable under the Loan Agreement in connection with the termination of the revolving loan commitment; -- The Company will maintain a minimum balance of $4 million in a specified account as collateral for the obligations under the Loan Agreement; and -- The Company and GE reserve their respective rights as whether interest at the default rate is payable, and if it is determined that it is payable, such amount, less the $70,000 referred to above, shall be added to the amount of the obligations under the Loan Agreement. The Stipulation and Order was approved by the Bankruptcy Court on a final basis on October 28, 2014. The Company has set aside, in a separate account, $4 million as collateral for obligations under the Loan Agreement and classified this amount as restricted cash on its balance sheet. As long as the Stipulation and Order is in effect, GE has agreed to not seek to take any action to accelerate payment under the Loan Agreement or exercise any remedies. The GE loan is considered fully secured and is not reported as liabilities subject to compromise. About SIGA Technologies Publicly held SIGA Technologies, Inc., with headquarters in Madison Avenue, New York, is a biotech/pharmaceutical company that specializes in the development and commercialization of solutions for serious unmet medical needs and biothreats. SIGA's lead product is Tecovirimat, also known as ST-246, an orally administered antiviral drug that targets orthopoxviruses. SIGA sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 14-12623) on Sept. 16, 2014, in Manhattan. The case is assigned to Judge Sean H. Lane. The Debtor has tapped Weil, Gotshal & Manges LLP, as counsel, and Prime Clerk LLC as claims agent. According to the docket, the schedules of assets and liabilities and the statement of financial affairs are due Sept. 30, 2014. The Debtor's Chapter 11 plan and disclosure statement are due Jan. 14, 2015. The initial case conference is due by Oct. 16, 2014. As of June 30, 2014, SIGA reported consolidated assets and liabilities of $209 million and $198 million, respectively. The amount of reported liabilities does not include any amount attributable to the lawsuit filed by PharmAthene, Inc. A total of $2.50 million is outstanding on a secured term loan with General Electric Capital Corp. Trade payables total $3.3 million. SIMON WORLDWIDE: Three Lions to Voluntarily Liquidate ----------------------------------------------------- The executive board of Three Lions Entertainment, LLC, considered and unanimously voted to approve a plan proposed by Three Lions' management, with the assistance of its advisors, to proceed with the voluntary liquidation and dissolution of Three Lions in accordance with Delaware law, according to a regulatory filing with the U.S. Securities and Exchange Commission. In a meeting held on Oct. 27, 2014, the executive board concluded that Three Lions would not have adequate funds to continue to operate. Three Lions is a variable interest entity in which Simon Worldwide, Inc., holds membership units representing a 60% economic interest, but which does not provide the Company the ability to exercise control. "Due to a confluence of a number of adverse factors, but in particular, a ratings performance well below expectations on Three Lion's initial Fashion RocksTM broadcast on Sept. 9, 2014, and the resultant decision to cancel further production on other projects, Three Lions recorded unanticipated losses," the filing stated. The executive board also voted to appoint Three Lions' Chief Operating Officer and Chief Financial Officer, Stacey Bain, as the liquidating trustee for Three Lions. The Company currently estimates that it will incur charges and expenses in connection with the liquidation and dissolution of Three Lions of approximately $220,000, including a $199,583 charge pursuant to the cash collateralized bank letter of credit that the Company provided to support payments on an office lease obtained by Three Lions, and additional legal and other professional fees and associated costs estimated to total approximately $20,000. The Company expects to write off the value of its investment in Three Lions on its financial statements for the quarter ended Sept. 30, 2014, which will be filed with the Company's Quarterly Report on Form 10-Q for said quarter, because the Company's share of Three Lions' operating losses for the quarter ended Sept. 30, 2014, is expected to exceed the $4,308,000 carrying value of that investment as of June 30, 2014. The Company is party to a Pledge Agreement with SunTrust Bank pursuant to which the Company pledged all of its equity interests in Three Lions and any and all proceeds therefrom, to SunTrust as security for Three Lions' obligations under its credit facility with SunTrust. The Pledge Agreement provides, among other things, that upon an event of default under the SunTrust credit agreement, SunTrust would be entitled to exercise all voting and other rights with respect to the Pledged Securities and to foreclose on the Pledged Securities. The Company does not know what, if any, actions SunTrust may seek to take against the Pledged Securities or the Company. The Pledge Agreement expressly provides that SunTrust will not have any claim, remedy or right to proceed against the Company for any deficiency in payment or performance of the obligations under the SunTrust credit agreement, from any source other than the Pledged Securities pledged by the Pledge Agreement. The Company does not expect to receive any amounts in respect of the Pledged Securities from a liquidation of Three Lions regardless of whether SunTrust elects to foreclose on the Pledged Securities or not, as the proposed liquidation plan does not provide for any distributions to be made to the equity holders in respect of their equity interests in Three Lions. The Company believes that the liquidation of Three Lions will have a material adverse effect on the Company, its financial condition and results of operations. Since its initial investment in Three Lions in March 2013, the Company's business has substantially consisted of acting as the majority equity holder of, and holding a membership interest in, Three Lions. Accordingly, the Company's results of operations and financial condition depend on the successful operations of Three Lions. The Company warns that to the extent that the Company is unable to identify and obtain an alternate source of funds, it may itself be forced to liquidate. However, management believes it has sufficient capital resources and liquidity to operate the Company for at least another 12 months. The Company's Board of Directors has instructed management to explore all possible strategic options for the Company to secure additional financing or an operating business, however, there can be no assurances whatsoever that the Company will be able to identify a viable strategic option to enable it to continue operations. About Simon Worldwide Based in Los Angeles, Simon Worldwide, Inc. (OTC: SWWI) no longer has any operating business. Prior to August 2001, the Company operated as a multi-national full-service promotional marketing company, specializing in the design and development of high-impact promotional products and sales promotions. At Dec. 31, 2009, the Company held an investment in Yucaipa AEC Associates, LLC, a limited liability company that is controlled by the Yucaipa Companies, a Los Angeles, California based investment firm. Yucaipa AEC in turn principally held an investment in the common stock of Source Interlink Companies, a direct-to-retail magazine distribution and fulfillment company in North America, and a provider of magazine information and front-end management services for retailers and a publisher of approximately 75 magazine titles. Yucaipa AEC held this investment in Source until April 28, 2009, when Source filed a pre-packaged plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code. Simon Worldwide reported a net loss of $3.63 million on $0 of revenue for the year ended Dec. 31, 2013, as compared with a net loss of $1.52 million on $0 of revenue for the year ended Dec. 31, 2012. The Company incurred a net loss of $1.97 million on $0 revenue in 2011. As of June 30, 2014, the Company had $6.15 million in total assets, $64,000 in total liabilities and $6.08 million in ttoal stockholders' equity. SKYLINE MANOR: Gets 7th Interim Approval on Cash Collateral Use --------------------------------------------------------------- The Bankruptcy Court authorized, in a seventh interim order, Ron Ross, as Chapter 11 trustee for Skyline Manor, Inc., to use cash collateral in which Oxford Finance LLC asserts an interest. The trustee's use of cash collateral to operate the healthcare facility is retroactive from Sept. 2, 2014, through the earlier of (i) Oct. 21, 2014, (ii) the date the trustee's right to use cash collateral terminates, or (iii) the entry of a final order authorizing the use of cash collateral. As reported in the TCR on Sept. 11, 2014, Oxford expressed its consent to the use of cash collateral. Oxford made certain loans and other financial accommodations available to the Debtor. It asserts that the loans are secured by first priority liens on and security interests in all of the Debtor's property. Hence, proceeds of Oxford's loan and the proceeds received therefrom are deemed as cash collateral. About Skyline Manor Skyline Manor Inc. is a Nebraska non-profit corporation that operates a 199-unit continuing care retirement community and a 140 unit independent living facility in Omaha. Skyline Manor filed a Chapter 11 bankruptcy petition (Bankr. D. Neb. Case No. 14-80934) on May 8, 2014. The petition was signed by John W. Bartle as chief restructuring officer. Judge Thomas L. Saladino presides over the case. The Debtor disclosed $19,892,926 in assets and $13,732,877 in liabilities as of the Chapter 11 filing. Mr. Ross has been appointed as the Chapter 11 trustee for Skyline Manor. SON P. DANG: Wrongful Foreclosure Suit Dismissed ------------------------------------------------ District Judge Ronald M. Whyte granted the defendants' motion to dismiss the First Amended Complaint in the wrongful foreclosure suit filed by Son P. Dang. A separate motion for sanctions is denied. The First Amended Complaint alleges wrongful foreclosure, slander of title, violation of California Civil Code Sec. 2923.5, Violation of 12 U.S.C. Sec. 2605, and violations of California Business and Professions Code Sec. 17200 et seq. The Defendants said the First Amended Complaint fails to state a claim upon which relief can be granted under Fed. R. Civ. Proc. 12(b)(6). Dang borrowed $670,000 from First Magnus Financial Corporation in 2007 to purchase property in San Jose. First Magnus filed for Chapter 11 bankruptcy in August 2007. The deed of trust was later transferred to the defendants. On July 11, 2013, Dang filed a Chapter 13 bankruptcy petition. It was closed on September 18, 2013 after Dang failed to file required documents. On May 6, 2014, Dang filed a second Chapter 13 bankruptcy petition, which is currently pending. That bankruptcy has been converted to a Chapter 11 bankruptcy. The lawsuit is captioned as SON P. DANG, Plaintiff, v. RESIDENTIAL CREDIT SOLUTIONS, INC.; JPMORGAN CHASE BANK, NATIONAL ASSOCIATION (fka EMC MORTGAGE, LLC); J.P. MORGAN MORTGAGE ACQUISITION CORP.; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC.; and DOES 1 through 20, inclusive, Defendants, Case No. C-14-02587-RMW (N.D. Cal.). A copy of the Court's October 31, 2014 Order is available at http://bit.ly/1x2250Tfrom Leagle.com. THEOBLOCK S.A.: Foreclosure Sale Set for Dec. 5 ----------------------------------------------- Pursuant to a Judgment of Foreclosure and Sale dated December 13, 2013 and entered on December 19, 2013, Nora Constance Marino, Esq., as Referee, will sell at public auction at the Queens County Supreme Courthouse, 88-11 Sutphin Blvd., in Courtroom #25, Jamaica, NY on December 5, 2014 at 10:00 a.m. the premises known as NO # 149TH AVENUE, QUEENS, NY. The Judgment of Foreclosure was issued in the case, NYCTL 1998-2 TRUST AND THE BANK OF NEW YORK MELLON, AS COLLATERAL AGENT AND CUSTODIAN for the NYCTL 1998-2 TRUST, Plaintiff against THEOBLOCK S.A. LTD., et al Defendant(s) in Supreme Court, County of Queens. The approximate amount of lien is $8,761 plus interest & costs. The Plaintiff is represented in the case by the Referee: Nora Constance Marino, Esq. ROSENBERG & ESTIS, P.C. 733 Third Ave., 14th Flr New York, NY 10017 THOMAS JEFFERSON SCHOOL: S&P Cuts Rating on 2008A Bonds to 'D' -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its long-term rating to 'D' from 'CC' and removed the rating from CreditWatch with negative implications on the California Statewide Communities Development Authority's series 2008A tax-exempt revenue bonds and series 2008B taxable revenue bonds issued for Thomas Jefferson School of Law (TJSL). "TJSL did not pay bondholders in full, as revealed in the trustee's Sept. 29, 2014, posting to EMMA," said Standard & Poor's credit analyst Carlotta Mills. According to S&P's criteria and rating definitions, an issue rating is lowered to 'D' "when payments on an obligation are not made on the date due." TIBCO SOFTWARE: S&P Assigns Prelim. 'B-' CCR; Outlook Stable ------------------------------------------------------------ Standard & Poor's Ratings Services said that it assigned its preliminary 'B-' corporate credit rating to Palo Alto, Calif.- based TIBCO Software Inc. The outlook is stable. At the same time, S&P assigned its preliminary 'B-' issue-level rating and preliminary '3' recovery rating to the company's proposed $1.65 billion senior secured first-lien term loan due 2020 and $125 million revolving credit facility due 2019. The preliminary '3' recovery rating indicates S&P's expectation for meaningful recovery (50%-70%; at the lower end of the range) in the event of payment default. S&P also assigned its preliminary 'CCC' issue-level rating and preliminary '6' recovery rating the company's proposed $950 million senior unsecured notes due 2021. The preliminary '6' recovery rating indicates S&P's expectation for negligible recovery (0%-10%) in the event of payment default. Balboa Merger Sub Inc. will be the initial borrower of the debt. Once the acquisition is completed, Balboa will merge into TIBCO, and TIBCO will be the borrower going forward. S&P will finalize its preliminary ratings following a review of the executed closing documents. The rating on TIBCO reflects S&P's adjusted leverage of almost 11x (pro forma for the proposed transaction, excluding the asset sale bridge facility and cost saving adjustments), the transition risk associated with TIBCO's aggressive cost reduction plan, and the company's recent slowing revenue growth. Partially offsetting these factors are significant cost saving opportunities that could result in adjusted leverage near 8x over the next 12 months--if the company manages transition risk effectively--and its established positions in the IT integration and analytics software markets. "The stable outlook reflects our view that TIBCO's cost saving opportunities and adequate liquidity are likely to mitigate unplanned business disruption from its cost restructuring activities, such that the company is likely to meet its debt service obligations over the next 12 months," said Standard & Poor's credit analyst Christian Frank. S&P could lower the rating if the expected headquarters sale- leaseback transaction is not on track to be completed before the asset sale bridge loan's maturity; if disruption from transition activities causes licenses and professional services sales to decline more than S&P expects, resulting in negative FOCF on a sustained basis; or if financial covenants restrict access to revolver borrowings such that S&P views the company's liquidity as less than adequate. S&P could raise the rating if the company generates consistent license sales and implements material cost reductions such that it records sustained leverage below 8x. TRUMP ENTERTAINMENT: Bankruptcy Hearing in Name Fight Postponed --------------------------------------------------------------- The Associated Press reported that attorneys have postponed a Delaware bankruptcy court hearing over Donald Trump's fight to remove his name from a struggling New Jersey casino. According to the report, the casino operator is fighting Mr. Trump's demand that the Trump name come off the Taj Mahal casino in Atlantic City, saying it can't afford the expense or distraction of the state lawsuit as it tries to save the Taj Mahal. The hearing was postponed until Nov. 24. About Trump Entertainment Resorts Trump Entertainment Resorts Inc., owner of the Atlantic City Boardwalk casinos that bear the name of Donald Trump, returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No. 14-12103) on Sept. 9, 2014, with plans to shutter its casinos. TER and its affiliated debtors own and operate two casino hotels located in Atlantic City, New Jersey. TER said it will close the Trump Taj Mahal Casino Resort by Sept. 16, 2014, and, absent union concessions, the Trump Plaza Hotel and Casino by Nov. 13, 2104. The Debtors have sought an order authorizing the joint administration of their Chapter 11 cases and the consolidation thereof for procedural purposes only. Judge Kevin Gross presides over the Chapter 11 cases. The Debtors have tapped Young, Conaway, Stargatt & Taylor, LLP, as counsel; Stroock & Stroock & Lavan LLP, as co-counsel; Houlihan Lokey Capital, Inc., as financial advisor; and Prime Clerk LLC, as noticing and claims agent. TER estimated $100 million to $500 million in assets as of the bankruptcy filing. The Debtors as of Sept. 9, 2014, owe $285.6 million in principal plus accrued but unpaid interest of $6.6 million under a first lien debt issued under their 2010 bankruptcy-exit plan. The Debtors also have trade debt in the amount of $13.5 million. TRUMP ENTERTAINMENT: Gets Final OK to Fund Case With Icahn Cash --------------------------------------------------------------- U.S. Bankruptcy Judge Kevin Gross in Wilmington, Del., gave Trump Entertainment Resorts Inc. final authority to use cash collateral securing its prepetition indebtedness, various news sources reported. According to Law360, the cash collateral order was signed after the casino operator resolved issues from unsecured creditors who worried it might dash any hope of a recovery. The right to use cash ends on Dec. 31, absent a new agreement, Bill Rochelle and Sherri Toub, bankruptcy columnists for Bloomberg News, reported. About Trump Entertainment Resorts Trump Entertainment Resorts Inc., owner of the Atlantic City Boardwalk casinos that bear the name of Donald Trump, returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No. 14-12103) on Sept. 9, 2014, with plans to shutter its casinos. TER and its affiliated debtors own and operate two casino hotels located in Atlantic City, New Jersey. TER said it will close the Trump Taj Mahal Casino Resort by Sept. 16, 2014, and, absent union concessions, the Trump Plaza Hotel and Casino by Nov. 13, 2104. The Debtors have sought an order authorizing the joint administration of their Chapter 11 cases and the consolidation thereof for procedural purposes only. Judge Kevin Gross presides over the Chapter 11 cases. The Debtors have tapped Young, Conaway, Stargatt & Taylor, LLP, as counsel; Stroock & Stroock & Lavan LLP, as co-counsel; Houlihan Lokey Capital, Inc., as financial advisor; and Prime Clerk LLC, as noticing and claims agent. TER estimated $100 million to $500 million in assets as of the bankruptcy filing. The Debtors as of Sept. 9, 2014, owe $285.6 million in principal plus accrued but unpaid interest of $6.6 million under a first lien debt issued under their 2010 bankruptcy-exit plan. The Debtors also have trade debt in the amount of $13.5 million. TRUMP ENTERTAINMENT: Disclosure Statement Hearing Set for Nov. 14 ----------------------------------------------------------------- The U.S. Bankruptcy Court in Delaware is set to hold a hearing on Nov. 14 to consider approval of the outlines of Trump Entertainment Resorts Inc.'s plan to exit Chapter 11 protection. Judge Kevin Gross earlier refused to sign off on the disclosure statement outlining the company's restructuring plan. At a hearing on Nov. 5, the bankruptcy judge reportedly told Trump to come back next week with a firmer vision for the company's future. Last week, Trump's official committee of unsecured creditors objected to the disclosure statement, saying it was a "complete waste of time" and that the only creditors deemed able to vote are the company's secured lenders controlled by billionaire investor Carl Icahn who is already dictating the terms of the plan. The committee also said Trump appears as if it will press forward to confirmation so to preserve hundreds of millions of dollars in tax credits for Mr. Icahn's benefit. The disclosure statement also drew flak from Atlantic City, Trump AC Casino Marks LLC and Levine, Staller, Sklar, Chan & Brown, P.A. The city complained the disclosure statement doesn't address Trump's unpaid taxes while the two other creditors complained the company only disclosed little information regarding their claims and how they will get paid. About Trump Entertainment Resorts Trump Entertainment Resorts Inc., owner of the Atlantic City Boardwalk casinos that bear the name of Donald Trump, returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No. 14-12103) on Sept. 9, 2014, with plans to shutter its casinos. TER and its affiliated debtors own and operate two casino hotels located in Atlantic City, New Jersey. TER said it will close the Trump Taj Mahal Casino Resort by Sept. 16, 2014, and, absent union concessions, the Trump Plaza Hotel and Casino by Nov. 13, 2104. The Debtors have sought an order authorizing the joint administration of their Chapter 11 cases and the consolidation thereof for procedural purposes only. Judge Kevin Gross presides over the Chapter 11 cases. The Debtors have tapped Young, Conaway, Stargatt & Taylor, LLP, as counsel; Stroock & Stroock & Lavan LLP, as co-counsel; Houlihan Lokey Capital, Inc., as financial advisor; and Prime Clerk LLC, as noticing and claims agent. TER estimated $100 million to $500 million in assets as of the bankruptcy filing. The Debtors as of Sept. 9, 2014, owe $285.6 million in principal plus accrued but unpaid interest of $6.6 million under a first lien debt issued under their 2010 bankruptcy-exit plan. The Debtors also have trade debt in the amount of $13.5 million. TSC SIEBER: 5th Cir. Vacates Ruling on $345,000 in Funds -------------------------------------------------------- The U.S. Court of Appeals for the Fifth Circuit directed a district court to redo its judgment that affirmed a bankruptcy court order holding that more than $345,000 in funds were part of the bankruptcy estate of debtor T.S.C. Sieber Services L.C. Holt Texas, Ltd., and Transamerica Underground Limited, subcontractors of T.S.C. Seiber, took an appeal from the September 24, 2013, district court judgment affirming the bankruptcy court order. The district court held that funds of an interpleader action, filed by EnCana Oil & Gas (USA) Inc., were property not of EnCana, but property of the bankruptcy estate of Seiber because the interpleader action extinguished the earlier construction liens of Holt and TAUG. On appeal they challenge the district and bankruptcy courts' reasoning and conclusions that: (1) the Texas Construction Trust Funds Act did not apply, because EnCana's deposit of the funds was not a qualifying payment triggering creation of a trust fund; and (2) Appellants did not have valid, perfected mineral liens under chapter 56 of the Texas Property Code. "We consider Appellants' contentions de novo and, for the reasons that follow, we vacate the district court's judgment and remand for further proceedings not inconsistent with this opinion," the Fifth Circuit said in a November 3, 2014 decision available at http://bit.ly/1vG11Kqfrom Leagle.com. The appellate case is, HOLT TEXAS, LIMITED, doing business as Holt Cat; TRANSAMERICAN, UNDERGROUND, LIMITED, Appellants, v. STEPHEN J. ZAYLER, Appellee, No. 13-41153 (5th Cir.). Circuit Judge E. Grady Jolly wrote the opinion. TSC Sieber Services, LC, filed a Chapter 11 voluntary petition (Bankr. E.D. Tex. Case No. 09-61042) on Oct. 17, 2009. The case was subsequently converted to Chapter 7 on Nov. 2, 2009, and Stephen J. Zayler was appointed as the Chapter 7 Trustee. The Debtor was primarily engaged in the business of pipeline construction. The Debtor eventually conducted its operations from three locations -- Arp, Texas, Millsap, Texas, and Keithville, Louisiana. TW TELECOM: S&P Lowers CCR to 'BB-' & Removes From Watch -------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its ratings on Littleton, Colo.-based TW Telecom Inc., including the corporate credit rating to 'BB-' from 'BB', and removed all ratings from CreditWatch, where S&P had placed them with negative implications on June 16, 2014. The outlook is stable. At the same time, S&P withdrew the 'BB+' issue-level rating on the company's senior secured credit facilities because this debt was paid off at the close of the acquisition. "The rating actions reflect the close of the acquisition of TW Telecom by Level 3 Communications Inc. (the corporate credit rating on which we raised today to 'BB-' from 'B+')," said Standard & Poor's credit analyst Catherine Cosentino. "We equalized the corporate credit rating on TW Telecom with that on Level 3 since we consider TW Telecom to be a core subsidiary of Level 3 because TW Telecom's assets will be integrated into, and expand, Level 3's network reach. While the secured credit facilities were repaid at close of the transaction, TW Telecom's unsecured debt is scheduled to be redeemed by Level 3 on Nov. 30, 2014, at which time we will withdraw the corporate credit rating on TW Telecom and the issue-level ratings on its unsecured notes," S&P noted. U.S. COAL: Add'l Debtors to Have Same Advisors ---------------------------------------------- Harlan County Mining, LLC, Oak Hill Coal, Inc., Sandlick Coal Company, LLC, and U.S. Coal Marketing, LLC, as debtors and debtors in possession -- Additional Debtors -- filed applications or motions seeking approval to employ, effective as of the commencement of their bankruptcy cases: -- Nixon Peabody LLP as their bankruptcy counsel; -- DelCotto Law Group PLLC as their general local bankruptcy counsel; -- GlassRatner Advisory & Capital Group as their financial advisor; -- John J. Brogan, JD, CPA d/b/a Brogantax as their consultant to advise them regarding tax planning in connection with net operating loss carryovers and emergence from bankruptcy; and -- Epiq Bankruptcy Solutions, LLC, as claims, noticing, and balloting agent. The affiliated-debtors who were earlier sent to Chapter 11 bankruptcy have previously obtained approval to hire Nixon Peabody, et al. The Court entered its final order granting the applications of LR Mining, LRR, Fox Knob, SM&J, and JAD (collectively, referred as "Subsidiary Debtors") granting the applications to tap Nixon Peabody and GlassRatner Advisory & Capital Group on a final basis on July 11, 2014. The Court on June 16, 2014, granted the original application to employ Epiq as claims agent. The Subsidiary Debtors and U.S. Coal won final approval to employ DelCotto Law Group on July 14, 2014. The Court on Aug. 20, 2014, entered an order approving the Debtors' original application to employ Mr. Brogan. By the new motions, the Debtors are simply seeking to employ Nixon Peabody, et al., to represent the Additional Debtors as well. Copies of the Additional Debtors' applications are available for free at: http://bankrupt.com/misc/US_Coal_AD_Brogan.pdf http://bankrupt.com/misc/US_Coal_AD_Delcotto.pdf http://bankrupt.com/misc/US_Coal_AD_Epiq.pdf http://bankrupt.com/misc/US_Coal_AD_Glassratner.pdf http://bankrupt.com/misc/US_Coal_AD_Nixon.pdf About U.S. Coal and Licking River On May 22, 2014, an involuntary Chapter 11 petition was filed against Licking River Mining, LLC, before the United States Bankruptcy Court for the Eastern District of Kentucky. On May 23, 2014, an involuntary Chapter 11 petition was filed against Licking River Resources, Inc. and Fox Knob Coal., Inc. On June 3, 2014, an involuntary Chapter 11 petition was filed against S.M. & J., Inc. On June 4, 2014, an involuntary Chapter 11 petition was filed against J.A.D. Coal Company, Inc. On June 12, 2014, the Court entered an order for relief in each of the bankruptcy cases. On June 10, 2014, an involuntary Chapter 11 petition was filed against U.S. Coal Corporation. On June 27, 2014, the Court entered an order for relief in U.S. Coal's bankruptcy case. On Nov. 4, 2014, Harlan County Mining, LLC, Oak Hill Coal, Inc., Sandlick Coal Company, LLC, and U.S. Coal Marketing, LLC, filed petitions in the United States Bankruptcy Court for the Eastern District of Kentucky seeking relief under chapter 11 of the United States Bankruptcy Code. The Debtors' cases have been assigned to Chief Judge Tracey N. Wise. The Debtors are seeking to have their cases jointly administered for procedural purposes, meaning that upon entry of such an order all pleadings will be maintained on the case docket for Licking River Mining, LLC, Case No. 14-10201. U.S. Coal produces and sells thermal coal purchased primarily by utilities and trading companies and specialty coal purchased by various industrial customers and trading companies (known as "stoker" coal). U.S. Coal operates through two divisions: (1) the Licking River Division that was formed through the acquisition of LR Mining, LRR, and S.M. & J., and Oak Hill Coal, Inc. in January 2007 for $33 million., and (2) the J.A.D. Division that was formed through the acquisition of JAD and Fox Knob, and Sandlick Coal Company, LLC and Harlan County Mining, LLC in April 2008 for $41 million. Both the LRR Division and the JAD Division are located in the Central Appalachia region of eastern Kentucky. The LRR Division has approximately 26.3 million tons of surface reserves under lease. The JAD Division has 24.4 million tons of surface reserves, both leased and owned real property. At present, U.S. Coal has three surface mines in operation between the LRR Division and JAD Division. The Official Committee of Unsecured Creditors has tapped Barber Law PLLC and Foley & Lardner as attorneys. U.S. COAL: JAD Gets Access to Lenders' Collateral Until January --------------------------------------------------------------- J.A.D. Coal Company, Inc., and Fox Knob Coal Co., Inc., have obtained consent from their secured creditors, namely the estate of Aubra Paul Dean, Carl E. McAfee and Julia McAfee, to continue using collateral until Jan. 31, 2015. The Adequate Protection Order entered by the Court on Aug. 20, 2014, provided the JAD Lenders would receive adequate protection payments of $25,000 per month beginning July 15, 2014 through Oct. 31, 2014. The First Amended Agreed Order and Joint Stipulation signed by the parties provides that as adequate protection of the JAD Lenders' asserted security interests in the Collateral, the Debtors are authorized to make monthly payments of $25,000 on the 15th of each month to the JAD Lenders for each month from and including Nov. 1, 2014 through and including Jan. 31, 2015. The JAD Lenders are represented by: Gregory D. Pavey, Esq. STOLL KEENON OGDEN PLLC Joseph M. Scott, Jr., Esq. 300 West Vine Street, Suite 2100 Lexington, KY 40507 Tel: (859) 231-3000 Fax: (859) 253-1900 E-mail: joseph.scott@skofirm.com gregory.pavey@skofirm.com About U.S. Coal and Licking River On May 22, 2014, an involuntary Chapter 11 petition was filed against Licking River Mining, LLC, before the United States Bankruptcy Court for the Eastern District of Kentucky. On May 23, 2014, an involuntary Chapter 11 petition was filed against Licking River Resources, Inc. and Fox Knob Coal., Inc. On June 3, 2014, an involuntary Chapter 11 petition was filed against S.M. & J., Inc. On June 4, 2014, an involuntary Chapter 11 petition was filed against J.A.D. Coal Company, Inc. On June 12, 2014, the Court entered an order for relief in each of the bankruptcy cases. On June 10, 2014, an involuntary Chapter 11 petition was filed against U.S. Coal Corporation. On June 27, 2014, the Court entered an order for relief in U.S. Coal's bankruptcy case. On Nov. 4, 2014, Harlan County Mining, LLC, Oak Hill Coal, Inc., Sandlick Coal Company, LLC, and U.S. Coal Marketing, LLC, filed petitions in the United States Bankruptcy Court for the Eastern District of Kentucky seeking relief under chapter 11 of the United States Bankruptcy Code. The Debtors' cases have been assigned to Chief Judge Tracey N. Wise. The Debtors are seeking to have their cases jointly administered for procedural purposes, meaning that upon entry of such an order all pleadings will be maintained on the case docket for Licking River Mining, LLC, Case No. 14-10201. U.S. Coal produces and sells thermal coal purchased primarily by utilities and trading companies and specialty coal purchased by various industrial customers and trading companies (known as "stoker" coal). U.S. Coal operates through two divisions: (1) the Licking River Division that was formed through the acquisition of LR Mining, LRR, and S.M. & J., and Oak Hill Coal, Inc. in January 2007 for $33 million., and (2) the J.A.D. Division that was formed through the acquisition of JAD and Fox Knob, and Sandlick Coal Company, LLC and Harlan County Mining, LLC in April 2008 for $41 million. Both the LRR Division and the JAD Division are located in the Central Appalachia region of eastern Kentucky. The LRR Division has approximately 26.3 million tons of surface reserves under lease. The JAD Division has 24.4 million tons of surface reserves, both leased and owned real property. At present, U.S. Coal has three surface mines in operation between the LRR Division and JAD Division. The Debtors have tapped Nixon Peabody LLP as bankruptcy counsel, DelCotto Law Group PLLC as local counsel, GlassRatner Advisory & Capital Group as financial advisor, John J. Brogan, JD as tax consultant, and Epiq Bankruptcy Solutions LLC as claims agent. The Official Committee of Unsecured Creditors has tapped Barber Law PLLC and Foley & Lardner as attorneys. U.S. COAL: JAD Access to Caterpillar Collateral Extended -------------------------------------------------------- Debtors J.A.D. Coal Company, Inc. and Licking River Resources, Inc., along with the Official Committee of Unsecured Creditors, have signed a stipulation extending the Debtors' adequate protection payments to Caterpillar Financial Services Corporation until Jan. 31, 2015. On Oct. 1, 2014, the Court approved a stipulation providing that Caterpillar would receive adequate protection payments of $27,795.34 per month from JAD and $130,007 per month from Licking River, until Oct. 31, 2014. JAD and Licking River continue to utilize their respective J.A.D. Collateral1 and the Licking River Collateral and will continue to do so beyond Oct. 31, 2014. The parties agree that as adequate protection of Caterpillar's asserted security interest in the J.A.D. Collateral, JAD is authorized to make monthly payments of $27,795 to Caterpillar on the 16th day of each month from Nov. 1, 2014 through and including Jan. 31, 2015. Licking River is authorized to make monthly payments of $130,007 to Caterpillar on the 28th day of each month from Nov. 1, 2014 through and including Jan. 31, 2015. JAD's and Licking River's obligations to make the monthly Adequate Protection Payments to Caterpillar will automatically extend beyond Jan. 31, 2015 without further action by the Parties, only if: (a) the period of the Final Cash Collateral Order and any related cash collateral Budgets is extended, renewed, or amended beyond Jan. 31, 2015; and (b) such Budgets for any period beyond Jan. 31, 2015 account for the payment of these Adequate Protection Payments. Caterpillar is represented by: WYATT, TARRANT & COMBS, LLP John P. Brice, Esq. 250 West Main Street, Suite 1600 Lexington, KY 40507-1746 Telephone: (859) 233-2012 Facsimile: (859) 259-0649 E-mail: lexbankruptcy@wyattfirm.com About U.S. Coal and Licking River On May 22, 2014, an involuntary Chapter 11 petition was filed against Licking River Mining, LLC, before the United States Bankruptcy Court for the Eastern District of Kentucky. On May 23, 2014, an involuntary Chapter 11 petition was filed against Licking River Resources, Inc. and Fox Knob Coal., Inc. On June 3, 2014, an involuntary Chapter 11 petition was filed against S.M. & J., Inc. On June 4, 2014, an involuntary Chapter 11 petition was filed against J.A.D. Coal Company, Inc. On June 12, 2014, the Court entered an order for relief in each of the bankruptcy cases. On June 10, 2014, an involuntary Chapter 11 petition was filed against U.S. Coal Corporation. On June 27, 2014, the Court entered an order for relief in U.S. Coal's bankruptcy case. On Nov. 4, 2014, Harlan County Mining, LLC, Oak Hill Coal, Inc., Sandlick Coal Company, LLC, and U.S. Coal Marketing, LLC, filed petitions in the United States Bankruptcy Court for the Eastern District of Kentucky seeking relief under chapter 11 of the United States Bankruptcy Code. The Debtors' cases have been assigned to Chief Judge Tracey N. Wise. The Debtors are seeking to have their cases jointly administered for procedural purposes, meaning that upon entry of such an order all pleadings will be maintained on the case docket for Licking River Mining, LLC, Case No. 14-10201. U.S. Coal produces and sells thermal coal purchased primarily by utilities and trading companies and specialty coal purchased by various industrial customers and trading companies (known as "stoker" coal). U.S. Coal operates through two divisions: (1) the Licking River Division that was formed through the acquisition of LR Mining, LRR, and S.M. & J., and Oak Hill Coal, Inc. in January 2007 for $33 million., and (2) the J.A.D. Division that was formed through the acquisition of JAD and Fox Knob, and Sandlick Coal Company, LLC and Harlan County Mining, LLC in April 2008 for $41 million. Both the LRR Division and the JAD Division are located in the Central Appalachia region of eastern Kentucky. The LRR Division has approximately 26.3 million tons of surface reserves under lease. The JAD Division has 24.4 million tons of surface reserves, both leased and owned real property. At present, U.S. Coal has three surface mines in operation between the LRR Division and JAD Division. The Debtors have tapped Nixon Peabody LLP as bankruptcy counsel, DelCotto Law Group PLLC as local counsel, GlassRatner Advisory & Capital Group as financial advisor, John J. Brogan, JD as tax consultant, and Epiq Bankruptcy Solutions LLC as claims agent. The Official Committee of Unsecured Creditors has tapped Barber Law PLLC and Foley & Lardner as attorneys. UNITEK GLOBAL: Obtains Court Approval for First-Day Motions ----------------------------------------------------------- UniTek Global Services, Inc., a provider of permanently outsourced infrastructure services to the telecommunications, broadband cable, wireless, transportation, public safety and satellite television industries, announced today that it has received court approval of its First-Day Motions at a hearing in the United States Bankruptcy Court for the District of Delaware. The approval of the Motions by the Bankruptcy Court completes an important step toward implementation of the previously announced prepackaged Chapter 11 Plan, which received unanimous support of the Company's lenders. It will help to ensure that UniTek's operations will continue smoothly and that it will be business as usual. The Company is now scheduled for a hearing in early December to approve its Restructuring Plan and to set an expedited schedule for the Company's emergence from Chapter 11. In addition, the Company has received interim approval for post- petition financing, which will provide financing for working capital and for general corporate purposes. "We are pleased with the Court's prompt approval of our Motions," said Rocky Romanella, UniTek's Chief Executive Officer. "The Court's action ensures that we will be able to maintain regular operations, while meeting our obligations to our suppliers and serving our customers as we work to realign our capital structure as expeditiously as possible." About UniTek Global Services UniTek Global Services, Inc., based in Blue Bell, Pennsylvania, provides fulfillment and infrastructure services to media and telecommunication companies in the United States and Canada. UniTek Global reported a net loss of $52.07 million on $471.93 million of revenues for the year ended Dec. 31, 2013, as compared with a net loss of $77.73 million on $437.59 million of revenues in 2012. The Company's balance sheet at March 29, 2014, showed $249.60 million in total assets, $257.33 million in total liabilities and a $7.72 million total stockholders' deficit. Bankruptcy Warning "An event of default under either of our credit facilities could result in, among other things, the acceleration and demand for payment of all the principal and interest due and the foreclosure on the collateral. As a result of such a default or action against collateral, we could be forced to enter into bankruptcy proceedings, which may result in a partial or complete loss of your investment," the Company said in its annual report for the year ended Dec. 31, 2013. * * * As reported by the TCR on Oct. 17, 2013, Standard & Poor's Ratings Services said it raised its corporate credit rating on Blue Bell, Pa.-based UniTek Global Services Inc. to 'B-' from 'CCC'. "The ratings upgrade to 'B-' reflects our belief that the company is no longer vulnerable and dependent on favorable developments to meet its financial commitments over the next few years," said Standard & Poor's credit analyst Michael Weinstein. The TCR reported on Oct. 10, 2014, that Moody's Investors Service downgraded UniTek Global Services, Inc.'s corporate family rating to Ca. The Ca corporate family rating reflects Moody's view that the forbearance agreement entered into with UniTek's lenders on August 8th would be considered a default under Moody's definition. UNITEK GLOBAL: New Mountain Puts First Lien on Non-Accrual Status ----------------------------------------------------------------- As of September 30, 2014, New Mountain Finance Corporation placed a portion of its first lien position in UniTek Global Services, Inc. ("UniTek") on non-accrual status in anticipation of a voluntary petition for a "Pre-Packaged" Chapter 11 Bankruptcy in the U.S. Bankruptcy Court for the District of Delaware which was filed on November 3, 2014. As of September 30, 2014, the portion of the UniTek first lien position placed on non-accrual status represented an aggregate cost basis of $11.2 million and aggregate fair value of $8.2 million, and was assigned an investment rating of "4". The remaining portion of the Company?s first lien and warrants position in UniTek representing an aggregate cost basis of $30.6 million and aggregate fair value of $21.9 million, was assigned an investment rating of "3". As of September 30, 2014, three portfolio companies (including UniTek referenced above) had an investment rating of "3", with a total cost basis of approximately $42.0 million and a fair value of approximately $30.0 million. As of September 30, 2014, two portfolio companies (including UniTek referenced above) were on non-accrual status and had an investment rating of "4". As of September 30, 2014, the investments in these portfolio companies had an aggregate cost basis of approximately $12.9 million and an aggregate fair value of approximately $8.6 million. The disclosure was made in New Mountain Finance Corporation's earnings release for the quarter ended September 30, 2014, a copy of which is available for free at http://is.gd/1My3IS About UniTek Global Services UniTek Global Services, Inc., based in Blue Bell, Pennsylvania, provides fulfillment and infrastructure services to media and telecommunication companies in the United States and Canada. UniTek Global reported a net loss of $52.07 million on $471.93 million of revenues for the year ended Dec. 31, 2013, as compared with a net loss of $77.73 million on $437.59 million of revenues in 2012. The Company's balance sheet at March 29, 2014, showed $249.60 million in total assets, $257.33 million in total liabilities and a $7.72 million total stockholders' deficit. Bankruptcy Warning "An event of default under either of our credit facilities could result in, among other things, the acceleration and demand for payment of all the principal and interest due and the foreclosure on the collateral. As a result of such a default or action against collateral, we could be forced to enter into bankruptcy proceedings, which may result in a partial or complete loss of your investment," the Company said in its annual report for the year ended Dec. 31, 2013. * * * As reported by the TCR on Oct. 17, 2013, Standard & Poor's Ratings Services said it raised its corporate credit rating on Blue Bell, Pa.-based UniTek Global Services Inc. to 'B-' from 'CCC'. "The ratings upgrade to 'B-' reflects our belief that the company is no longer vulnerable and dependent on favorable developments to meet its financial commitments over the next few years," said Standard & Poor's credit analyst Michael Weinstein. The TCR reported on Oct. 10, 2014, that Moody's Investors Service downgraded UniTek Global Services, Inc.'s corporate family rating to Ca. The Ca corporate family rating reflects Moody's view that the forbearance agreement entered into with UniTek's lenders on August 8th would be considered a default under Moody's definition. VERITEQ CORP: Names Marc Gelberg Chief Accounting Officer --------------------------------------------------------- Marc Gelberg was appointed chief accounting officer and vice president of financial reporting of VertiTeQ Corporation and will serve as the Company's principal accounting officer, according to a regulatory filing with the U.S. Securities and Exchange Commission. Mr. Gelberg was previously corporate controller of Fusion Telecommunications International, Inc., a provider of unified communications and cloud services, since April of 2011, assuming the additional responsibilities of vice president of finance and senior vice president of finance in November of 2012 and March of 2014, respectively. From November of 2010 through March of 2011, Mr. Gelberg served as an SEC Reporting consultant for China Direct Industries, Inc., primarily serving its client companies. From February of 2008 through September 2010, Mr. Gelberg was vice president, corporate controller for Cross Match Technologies, Inc., and from July of 2006 through February of 2008 he was vice president of Accounting and Financial Reporting for ION Media Networks, Inc. Mr. Gelberg holds a Bachelor?' Degree in Economics from the State University of New York at Albany, and received his CPA certification from the State of New York in 1994. About VeriTeQ VeriTeQ (formerly known as Digital Angel Corporation) develops innovative, proprietary RFID technologies for implantable medical device identification, and dosimeter technologies for use in radiation therapy treatment. VeriTeQ offers the world's first FDA cleared RFID microchip technology that can be used to identify implantable medical devices, in vivo, on demand, at the point of care. VeriTeQ's dosimeters provide patient safety mechanisms while measuring and recording the dose of radiation delivered to a patient in real time. For more information on VeriTeQ, please visit www.veriteqcorp.com Veriteq Corporation reported a net loss of $15.07 million on $18,000 of sales for the year ended Dec. 31, 2013, as compared with a net loss of $1.60 million on $0 of sales for the year ended Dec. 31, 2012. As of June 30, 2014, the Company had $7.04 million in total assets, $14.16 million in total liabilities and a $7.12 million total stockholders' deficit. EisnerAmper LLP, in New York, New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company has incurred recurring net losses, and at Dec. 31, 2013, had negative working capital and a stockholders' deficit. These events and conditions raise substantial doubt about the Company's ability to continue as a going concern. VILLAGE AT KNAPP'S: Lormax & Visser Want to Buy Property -------------------------------------------------------- Matt Vande Bunte, writing for Mlive.com, reports that Lormax Stern Development Co. and Visser Brothers, Inc., want to buy the Village at Knapp's Crossing property on the East Beltline out of bankruptcy and put 13 more commercial buildings on the site, setting the buildings back from the street, with parking in front of them. According to Mlive.com, the city's Planning Commission wasn't thrilled with the developer's idea to turn the land into an "auto- oriented, over-parked shopping center." The report says that planning commissioners want developers to: (i) talk with neighbors about the project, including how to improve pedestrian and bicycle access to and through the property; (ii) incorporate some form of "placemaking" so that the property doesn't look like the auto-in- auto-out shopping center that developers want it to be, and (iii) housing on the site. The report states that the rezoning is tentatively scheduled to come back to the commission Nov. 13. Mlive.com recalls that Steve Benner, who bought the apple orchard at the corner of Knapp Street and the East Beltline in 2004, had planned a $60 million "lifestyle center" with about 300,000 square-feet of commercial space anchored by a walkable "main street," but that didn't materialize. "That type of plan really doesn't work in northern climates. I mean, I'm sure it exists in places that haven't gone bankrupt, yet. (We) believe it to be un- leasable and anticipate a lot of success with this (suburban) model," Mlive.com quoted Visser Bros. president Bill Mast as saying. About The Village at Knapp's Crossing The Village at Knapp's Crossing, L.L.C. in Grand Rapids, Michigan, filed for Chapter 11 (Bankr. W.D. Mich. Case No. 13-06094) on July 25, 2013. The Debtor scheduled $65,109,523 in total assets and $7,419,217 in total liabilities. The petition was signed by Steven D. Benner, managing member on behalf of S.D. Benner, sole member. As reported by the Troubled Company Reporter on June 10, 2014, Jim Harger, writing for MLive.com, reported that Judge Scott W. Dales, who presides over the case, granted on June 9 a request by the International Bank of Chicago to convert the Chapter 11 case to Chapter 7. Lawyers at Tishkoff & Associates PLLC, led by William G. Tishkoff, Esq., serve as the Debtor's counsel. John S. Huizinga CPA serves as accountants. WALTER ENERGY: Incurs $98.9 Million Net Loss in Third Quarter ------------------------------------------------------------- Walter Energy, Inc., reported a net loss of $98.90 million on $329.54 million of revenues for the three months ended Sept. 30, 2014, compared to a net loss of $100.72 million on $455.79 million of revenues for the same period in 2013. For the nine months ended Sept. 30, 2014, the Company reported a net loss of $342.47 million on $1.12 billion of revenues compared to a net loss of $184.66 million on $1.38 billion of revenues for the same period during the prior year. The Company's balance sheet at Sept. 30, 2014, showed $5.64 billion in total assets, $5.18 billion in total liabilities and $454.91 million in stockholders' equity. "In the challenging pricing environment for met coal, we remain focused on lowering production costs, reducing SG&A and improving productivity," said Walt Scheller, chief executive officer. "We have also idled assets that aren't generating cash, and we're reducing inventory across the Company. We expect our operating and financial results to reflect these actions going forward, making us more competitive and positioning us well for a recovery in met coal pricing." A copy of the press release is available for free at: http://is.gd/KstI7f About Walter Energy Walter Energy is a leading, publicly traded "pure-play" metallurgical coal producer for the global steel industry with strategic access to high-growth steel markets in Asia, South America and Europe. The Company also produces thermal coal, anthracite, metallurgical coke and coal bed methane gas. Walter Energy employs approximately 2,900 employees with operations in the United States, Canada and United Kingdom. * * * As reported by the TCR on Aug. 19, 2014, Standard & Poor's Ratings Services said it raised its corporate credit rating on Birmingham, Ala.-based Walter Energy Inc. to 'CCC+' from 'SD'. S&P believes the company's capital structure is likely unsustainable in the long-term absent an improvement in met coal prices. The TCR reported on July 10, 2014, that Moody's downgraded the Corporate Family Rating of Walter Energy, Inc., to Caa2 from Caa1. The downgrade in the corporate family rating reflects the anticipated deterioration in performance, increased cash burn and increase in leverage, given the recent met coal benchmark settlement of $120 per tonne for high quality coking coal and our expectation that meaningful recovery in metallurgical coal markets is twelve to eighteen months away. WALTER ENERGY: Incurs $98.9 Million Net Loss in Third Quarter ------------------------------------------------------------- Walter Energy, Inc., reported a net loss of $98.90 million on $329.54 million of revenues for the three months ended Sept. 30, 2014, compared to a net loss of $100.72 million on $455.79 million of revenues for the same period in 2013. For the nine months ended Sept. 30, 2014, the Company reported a net loss of $342.47 million on $1.12 billion of revenues compared to a net loss of $184.66 million on $1.38 billion of revenues for the same period during the prior year. The Company's balance sheet at Sept. 30, 2014, showed $5.64 billion in total assets, $5.18 billion in total liabilities and $454.91 million in stockholders' equity. "In the challenging pricing environment for met coal, we remain focused on lowering production costs, reducing SG&A and improving productivity," said Walt Scheller, chief executive officer. "We have also idled assets that aren't generating cash, and we're reducing inventory across the Company. We expect our operating and financial results to reflect these actions going forward, making us more competitive and positioning us well for a recovery in met coal pricing." A copy of the press release is available for free at: http://is.gd/KstI7f About Walter Energy Walter Energy is a leading, publicly traded "pure-play" metallurgical coal producer for the global steel industry with strategic access to high-growth steel markets in Asia, South America and Europe. The Company also produces thermal coal, anthracite, metallurgical coke and coal bed methane gas. Walter Energy employs approximately 2,900 employees with operations in the United States, Canada and United Kingdom. * * * As reported by the TCR on Aug. 19, 2014, Standard & Poor's Ratings Services said it raised its corporate credit rating on Birmingham, Ala.-based Walter Energy Inc. to 'CCC+' from 'SD'. S&P believes the company's capital structure is likely unsustainable in the long-term absent an improvement in met coal prices. The TCR reported on July 10, 2014, that Moody's downgraded the Corporate Family Rating of Walter Energy, Inc., to Caa2 from Caa1. The downgrade in the corporate family rating reflects the anticipated deterioration in performance, increased cash burn and increase in leverage, given the recent met coal benchmark settlement of $120 per tonne for high quality coking coal and our expectation that meaningful recovery in metallurgical coal markets is twelve to eighteen months away. ZOGENIX INC: Signs Waiver Agreement With Purdue Pharma ------------------------------------------------------ Zogenix, Inc., entered into a Waiver Agreement with Purdue Pharma L.P., pursuant to which Zogenix granted to Purdue a permanent, irrevocable, non-transferable and exclusive waiver of the three- year Hatch-Waxman regulatory exclusivity period with respect to NDA 202880 for Zohydro ER(R) capsules in support of Purdue's single-entity, extended-release hydrocodone product which is the subject of pending NDA 206627 and any single-entity, once-daily hydrocodone successor products or NDAs filed by Purdue. In addition, Purdue granted to Zogenix a permanent, irrevocable, non-transferable and exclusive waiver of the Hatch-Waxman regulatory exclusivity period with respect to Purdue Products in support of Zogenix's single-entity, twice-a-day hydrocodone product, including Zohydro ER and any successor products with any abuse deterrent properties or labeling claims. Under the terms of the Agreement, Purdue will pay to Zogenix (i) $5.0 million within 15 days of the date of the Agreement, (ii) $5.0 million on July 1, 2015, and (iii) a percentage royalty in the low single-digits on Purdue's net sales of Purdue Product commencing on Oct. 1, 2015, and ending on Oct. 25, 2016, only to the extent such royalty payment by Purdue in the aggregate would exceed $5.0 million and then only with respect to royalties in excess of that amount. About Zogenix Inc. Zogenix, Inc. (NASDAQ: ZGNX), with offices in San Diego and Emeryville, California, is a pharmaceutical company commercializing and developing products for the treatment of central nervous system disorders and pain. Zogenix reported a net loss of $80.85 million in 2013, as compared with a net loss of $47.38 million in 2012. The Company's balance sheet at June 30, 2014, the Company had $133.29 million in total assets, $64.98 million in total liabilities and $68.31 million in total stockholders' equity. Ernst & Young LLP, in San Diego, California, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2013. The independent auditors noted that the Company's recurring losses from operations and lack of sufficient working capital raise substantial doubt about its ability to continue as a going concern. * Heraldnet.com Reports 8 Snohomish County Bankr. Filings in Sept. ------------------------------------------------------------------ Heraldnet.com reports that seven Chapter 7 bankruptcy petitions and one Chapter 11 bankruptcy petition were filed with the U.S. Bankruptcy Court for the Western District of Washington between Sept. 1 and Sept. 30, 2014. According to Heraldnet.com, the Snohomish County Chapter 7 bankruptcy filers are: Debtor Case No. Counsel ------ -------- ------- Catherine J Mighell 14-16647 Jamie J McFarlane Michele S. Assayag Lisa M. McMahon-Myhran Roger DW Peek 14-16711 Richard J. Welt Robert R Curtis, Jr. 14-16731 Riley D. Lee Shawn Michael Doherty 14-16773 Stephen J. Garvey Darrel G. Rae 14-16833 Lawrence M. Blue James Stewart Grinnell 14-16945 Richard J. Shurtz and Yupha Kay Grinnell Lisa M. McMahon-Myhran Pineda Precision Inc 14-17025 Angela R. Neeleman Anthony Robert Iazeolla and Melanie Rea Iazeolla filed for Chapter 11 bankruptcy protection (Bankr. W.D. Wash. 14-16854) on Sept. 16, 2014. The Debtors are represented by Larry B. Feinstein and Jennifer L Aspaas. * Omaha.com Reports 18 Ch 7 & 3 Ch 13 Filings as of Oct. 31 ----------------------------------------------------------- Omaha.com reports 21 Chapter 7 and 13 bankruptcy filings as of Oct. 31, 2014. The Chapter 7 filings are: (1) Kale K. and Brandy J. Wicks 148 Glen Avenue, Council Bluffs; (2) Christopher C. and Elise M. Fiedler 1122 E. Fourth Street, Atlantic, Iowa; (3) Carl R. and Helen A. Brandenburg 402 Delong Avenue, Council Bluffs; (4) Matthew D. and Kristen M. Hughes 215 S. Second Street, Red Oak, Iowa; (5) Charles R. and Patricia A. Qualls 304 Western Avenue, Shelby, Iowa; (6) Melvin C. and Tanya M. Miller 25820 Teakwood Road, Neola, Iowa; (7) Christopher J. Sr. and Twila Hopkins P.O. Box 14, Harlan, Iowa; (8) Joshua L. Leonard P.O. Box 404, Pacific Junction, Iowa; (9) Maira C. Mirabal 2531 Pavich Drive, Council Bluffs; (10) Jeffery A. Dyrda 3453 Fourth Avenue, Council Bluffs; (11) Amy L. Olson 2733 Second Avenue, Council Bluffs; (12) Gary M. Thompson 1400 Franklin Avenue, Council Bluffs; (13) Christopher A. Howell 507 O Street, Hamburg, Iowa; (14) Lynn A. Strohecker 1904 Oak Street, Atlantic, Iowa; (15) William A. Eddington 1107 Court Street, Dunlap, Iowa; (16) Aaron M. Sitzmann 2911 Heard Lane, Council Bluffs; (17) Kasey O. Corum 306 N. 40th Street, Council Bluffs; and (18) Thelma J. Greenlee 15463 Crestview Drive, Council Bluffs. The Chapter 13 filings are: (1) Harry R. and Kathryn A. Wise 1617 Sixth Avenue, Council Bluffs; (2) Brian L. and Tami S. Halstrom P.O. Box 701, Avoca, Iowa; and (3) Sherry D. Horton 103 North Avenue, Council Bluffs. * American College of Bankruptcy to Induct Peggy Hunt as Fellow --------------------------------------------------------------- International law firm Dorsey & Whitney LLP on Nov. 5 disclosed that Peggy Hunt, a partner in the Firm's Salt Lake City office, will be inducted as a Fellow of the American College of Bankruptcy on March 13, 2015, in Washington, D.C. Ms. Hunt is one of 34 nominees being honored and recognized for their professional excellence and exceptional contributions to the fields of bankruptcy and insolvency. She has 25 years of experience in all aspects of bankruptcy law representation, including representing Chapter 11 trustees in large Ponzi and security fraud cases, corporate debtors, committees, and creditors. Ms. Hunt also serves on the Panel of Chapter 7 Trustees for the District of Utah, and represents receivers appointed in SEC civil enforcement actions. She regularly is invited to speak on topics involving bankruptcy and receivership law, and she is a Contributing Author for the Collier Bankruptcy Practice Guide. "Peggy's leadership and experience in the areas of bankruptcy and insolvency enhance our ability to serve client needs," said Dorsey Managing Partner Ken Cutler. "Being named a Fellow in the College is a well-deserved honor, and we are delighted Peggy's long- standing achievements in these fields are being acknowledged." The American College of Bankruptcy is an honorary professional and educational association of bankruptcy and insolvency professionals. The College plays an important role in sustaining professional excellence and supports educational and pro bono efforts in local communities around the country. College Fellows include commercial and consumer bankruptcy attorneys, judges, insolvency accountants, turnaround and workout specialists, law professors, government officials and others involved in the bankruptcy and insolvency community. The induction ceremony will take place at the Smithsonian Donald W. Reynolds Center for American Art and Portraiture, and will be presided over by Michael L. Cook, Chair of the College. About Dorsey & Whitney LLP Clients have relied on Dorsey since 1912 as a valued business partner. With locations across the United States and in Canada, Europe and the Asia-Pacific region, Dorsey provides an integrated, proactive approach to its clients' legal and business needs. Dorsey represents a number of the world's most successful companies from a wide range of industries, including leaders in the banking, energy, food and agriculture, health care, infrastructure, and mining sectors, as well as major non-profit and government entities. * BOOK REVIEW: The Sorcerer's Apprentice - Medical Miracles and Other Disasters ----------------------------------------------------------- Author: Sallie Tisdale Publisher: BeardBooks Softcover: 270 pages List Price: $34.95 Review by Henry Berry Order your own personal copy at http://is.gd/9SAfJR An earlier edition of "The Sorcerer's Apprentice" won an American Health Book Award in 1986. The book has been recognized as an outstanding book on popular science. Tisdale brings to her subject of the wide and engrossing field of health and illness the perspective, as well as the special sympathies and sensitivities, of a registered nurse. She is an exceptionally skilled writer. Again and again, her descriptions of ill individuals and images of illnesses such as cancer and meningitis make a lasting impression. Tisdale accomplishes the tricky business of bringing the reader to an understanding of what persons experience when they are ill; and in doing this, to understand more about the nature of illness as well. Her style and aim as a writer are like that of a medical or science journalist for leading major newspaper, say the "New York Times" or "Los Angeles Times." To this informative, readable style is added the probing interest and concern of the philosopher trying to shed some light on one of the central and most unsettling aspects of human existence. In this insightful, illuminating, probing exploration of the mystery of illness, Tisdale also outlines the limits of the effectiveness of treatments and cures, even with modern medicine's store of technology and drugs. These are often called "miracles" of modern medicine. But from this author's perspective, with the most serious, life-threatening, illnesses, doctors and other health- care professionals are like sorcerer's trying to work magic on them. They hope to bring improvement, but can never be sure what they do will bring it about. Tisdale's intent is not to debunk modern medicine, belittle its resources and ways, or suggest that the medical profession holds out false hopes. Her intent is do report on the mystery of serious illness as she has witnessed it and from this, imagined what it is like in her varied work as a registered nurse. She also writes from her own experiences in being chronically ill when she was younger and the pain and surgery going with this. She writes, "I want to get at the reasons for the strange state of amnesia we in the health professions find ourselves in. I want to find clues to my weird experiences, try to sense the nature of being sick." The amnesia of health professionals is their state of mind from the demands placed on them all the time by patients, employers, and society, as well as themselves, to cure illness, to save lives, to make sick people feel better. Doctors, surgeons, nurses, and other health-care professionals become primarily technicians applying the wonders of modern medicine. Because of the volume of patients, they do not get to spend much time with any one or a few of them. It's all they can do to apply the prescribed treatment, apply more of it if it doesn't work the first time, and try something else if this treatment doesn't seem to be effective. Added to this is keeping up with the new medical studies and treatments. But Tisdale stepped out of this problem- solving outlook, can-do, perfectionist mentality by opting to spend most of her time in nursing homes, where she would be among old persons she would see regularly, away from the high-charged atmosphere of a hospital with its "many medical students, technicians, administrators, and insurance review artists." To stay on her "medical toes," she balanced this with working occasional shifts in a nearby hospital. In her hospital work, she worked in a neonatal intensive care unit (NICU), intensive care unit (ICU), a burn center, and in a surgery room. From this combination of work with the infirm, ill, and the latest medical technology and procedures among highly-skilled professionals, Tisdale learned that "being sick is the strangest of states." This is not the lesson nearly all other health-care workers come away with. For them, sick persons are like something that has to be "fixed." They're focused on the practical, physical matter of treating a malady. Unlike this author, they're not focused consciously on the nature of pain and what the patient is experiencing. The pragmatic, results-oriented medical profession is focused on the effects of treatment. Tisdale brings into the picture of health care and seriously-ill patients all of what the medical profession in its amnesia, as she called it, overlooks. Simply in describing what she observes, Tisdale leads those in the medical profession as well as other interested readers to see what they normally overlook, what they normally do not see in the business and pressures of their work. She describes the beginning of a hip-replacement operation, the surgeon "takes the scalpel and cuts--the top of the hip to a third of the way down the thigh--and cuts again through the globular yellow fat, and deeper. The resident follows with a cautery, holding tiny spraying blood vessels and burning them shut with an electric current. One small, throbbing arteriole escapes, and his glasses and cheek are splattered." One learns more about what is actually going on in an operation from this and following passages than from seeing one of those glimpses of operations commonly shown on TV. The author explains the illness of meningitis, "The brain becomes swollen with blood and tissue fluid, its entire surface layered with pus...The pressure in the skull increases until the winding convolutions of the brain are flattened out...The spreading infection and pressure from the growing turbulent ocean sitting on top of the brain cause permanent weakness and paralysis, blindness, deafness...." This dramatic depiction of meningitis brings together medical facts, symptoms, and effects on the patient. Tisdale does this repeatedly to present illness and the persons whose lives revolve around it from patients and relatives to doctors and nurses in a light readers could never imagine, even those who are immersed in this world. Tisdale's main point is that the miracles of modern medicine do not unquestionably end the miseries of illness, or even unquestionably alleviate them. As much as they bring some relief to ill individuals and sometimes cure illness, in many cases they bring on other kinds of pains and sorrows. Tisdale reminds readers that the mystery of illness does, and always will, elude the miracle of medical technology, drugs, and practices. Part of the mystery of the paradoxes of treatment and the elusiveness of restored health for ill persons she focuses on is "simply the mystery of illness. Erosion, obviously, is natural. Our bodies are essentially entropic." This is what many persons, both among the public and medical professionals, tend to forget. "The Sorcerer's Apprentice" serves as a reminder that the faith and hope placed in modern medicine need to be balanced with an awareness of the mystery of illness which will always be a part of human life. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com by e-mail. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to the nation's bankruptcy courts. The list includes links to freely downloadable of these small-dollar petitions in Acrobat PDF documents. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, 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 202-362-8552. *** End of Transmission ***