/raid1/www/Hosts/bankrupt/TCR_Public/151103.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, November 3, 2015, Vol. 19, No. 307
Headlines
AMERICAN AGENCIES: U.S. Trustee Objects to Cash Use Request
AMERICAN AXLE: Posts $60.9 Million Net Income for Third Quarter
AMERICAN NATURAL ENERGY: Has Interim OK to Tap Hillair DIP Loan
ARCHDIOCESE OF MILWAUKEE: Bid to Appeal Denied as Moot
B. P. GREER RECYCLING: Case Summary & 20 Top Unsecured Creditors
BEHAVIORAL SUPPORT: Has Deals for Return of $5-Mil. to Estate
BOOMERANG TUBE: Parties Submit Post-Trial Briefs on Plan
BUDD COMPANY: Plan Hinges on Settlement with Parent
CASH STORE: Chapter 15 Recognition Hearing on Nov. 24
CHINA MEDICAL: Ruling Sustaining Professionals' Claims Reversed
CLAIREX TECHNOLOGIES: Case Summary & 20 Top Unsecured Creditor
COLT HOLDING: Disclosure Statement Hearing on Nov. 6
CON-WAY INC: S&P Lowers CCR to 'B' & Removes from Watch Neg.
COUTURE HOTEL: Withdraws Exclusivity Extension Motion
CUNNINGHAM LINDSEY: S&P Revises Outlook to Neg. & Affirms 'B' CCR
CUSTOM DIESEL: Case Summary & 20 Largest Unsecured Creditors
DYNAMIC DRYWALL: Legacy Bank Can Intervene in Suit vs. McPherson
ELBIT IMAGING: Provides Update to Notes Buyback Programs
EQUIPMENT ACQUISITION: 7th Cir. Affirms Horseshoe Summary Judgment
ESSAR STEEL: Moody's Cut CFR to Caa3 Amid Slump in Steel Prices
FIRST DATA: EJF Capital Owns 5.1% of Class A Shares as of Oct. 23
FIRST DATA: Fitch Assigns CCC+ Rating on $750MM Sr. Unsec. Notes
FIRST DATA: Prices $3.4-Bil. of 7% Senior Notes due 2023
FLATLANDS INVESTOR: Voluntary Chapter 11 Case Summary
FREEDOM COMMUNICATIONS: Case Summary & 20 Top Unsecured Creditors
FREEDOM COMMUNICATIONS: Files for Chapter 11 to Sell Assets
GLOBAL TELLINK: S&P Affirms 'B' CCR & Removes from Watch Neg.
GT ADVANCED: Motion to Approve KEIP, KERP Denied
GULF PACKAGING: Creditors Committee Balks at ASK Employment
HAIMARK LINE: Case Summary & 20 Largest Unsecured Creditors
HELLER EHRMAN: Order Allowing Former Worker's $1.1MM Claim Affirmed
HUTCHESON MEDICAL: Maybrook Healthcare Offers $7.2M for Parkside
INTELSAT SA: Reports Third Quarter 2015 Results
KELLERMEYER BERGENSONS: S&P Lowers CCR to 'B-'; Outlook Negative
KEMET CORP: Reports Preliminary Fiscal 2016 2nd Quarter Results
KEYPOINT GOVERNMENT: S&P Affirms 'B' CCR; Outlook Stable
KU6 MEDIA: Shareholders Elect 7 Directors
LEE STEEL: Stipulation on Entry of Financing Order Entered
LENNAR CORPORATION: Fitch Assigns BB+ Rating on $350MM Notes
LEVEL 3 FINANCING: Fitch Assigns BB Rating on Sr. Unsec. Notes
LEVEL 3: Has Private Offering of $900 Million Senior Notes
LIFE PARTNERS: Can Use $25-Mil. of Maturity Funds
MAGNUM HUNTER: Moody's Lowers CFR to Caa3, Expects Default
MGM RESORTS: Fitch Affirms 'B+' IDR; Outlook Positive
MINI MASTER: To Seek Confirmation of Reorganization Plan Dec. 15
MISSION NEW ENERGY: Ends Quarter with A$2.5 Million in Cash
MOSDOS OHR HATORAH: Receiver Selling Assets of Jewish School
NATIONAL AMUSEMENTS: S&P Affirms 'B+' CCR; Outlook Stable
NATURAL RESOURCE: S&P Lowers CCR to 'B'; Outlook Stable
NATURAL RESOURCE: S&P Lowers CCR to 'B'; Outlook Stable
NEEBO INC: S&P Lowers Corp. Credit Rating to 'CCC'; Outlook Neg.
NEVER SLIP: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
NGL ENERGY: S&P Affirms 'BB-' CCR; Outlook Stable
ORGANIC AVENUE: Files Chapter 7 Bankruptcy, Nov. 20 Auction Set
PACIFIC RECYCLING: Files Schedules of Assets and Liabilities
PACIFIC RECYCLING: Wants to Hire Spectrum CPA as Accountants
PATRIOT COAL: Files Motion to Modify Retiree Benefits
PATRIOT COAL: Retiree Committee, UMWA Agree to Benefits Changes
QUANTUM CORP: Reports Fiscal Second Quarter 2016 Results
QUIRKY INC: Gets Court Approval to Auction Assets in November
RAIL LOGISTICS: WA Federal Judge Says Execs No Standing to Sue
RANCHO ARROYO: Case Summary & 7 Largest Unsecured Creditors
RANCHO ARROYO: Files Schedules of Assets and Liabilities
RELATIVITY MEDIA: Claims Firm Reneged $30M TV Sale Funding
RELATIVITY MEDIA: Holthouse Carlin Okayed as Tax Advisor
RELATIVITY MEDIA: Kasowitz Benson Approved as Conflicts Counsel
RELATIVITY MEDIA: McGladrey Okayed to Provide Tax Advisory
RENFRO CORP: S&P Affirms 'B' CCR & Revises Outlook to Negative
REPUBLIC RESOURCES: Case Summary & 20 Top Unsecured Creditors
REVEL AC: Nightclub Operator Wins in Appeal from Sale Order
RIVER-BLUFF: Seeks to Obtain $5.37-Mil. Secured Credit From STCU
ROTONDO WEIRICH: Eisner Amper Approved as Financial Advisors
SAMSON RESOURCES: Final Cash Collateral Hearing Moved to Nov. 17
SEANERGY MARITIME: Jelco Delta Reports 88.5% Stake as of Sept. 11
SECURUS HOLDINGS: S&P Affirms 'B' CCR; Outlook Negative
STACKPOLE INT'L: S&P Raises CCR to 'BBB-' After JEH Deal Closed
TECHPRECISION CORP: Former Xchanging Exec. Tom Sammons Is New CFO
TERRESTAR CORP: Former Shareholder's Suit Denied as Moot
TOMS SHOES: S&P Lowers CCR to 'B-'; Outlook Stable
TROPICANA ENTERTAINMENT: Plan Contribution Claims Granted Priority
UNIVITA HOLDINGS: Tiger Capital to Auction Assets on Nov. 11
VALEANT PHARMACEUTICALS: S&P Lowers CCR to 'B+'; Outlook Negative
WESTERN DENTAL: S&P Lowers CCR to 'CCC+' then Withdraws Rating
WESTMORELAND COAL: Announces Executive Appointments
WESTMORELAND COAL: Reports Third Quarter 2015 Results
WESTMORELAND RESOURCE: Reports Third Quarter 2015 Results
XPO LOGISTICS: S&P Lowers Rating on Sr. Unsec. Notes to 'B-'
Z'TEJAS SCOTTSDALE: Wants Until Feb. 17, 2016 to Decide on Leases
ZUCKER GOLDBERG: Lists $4.1MM in Assets, $36.7MM in Debts
[*] Rate of U.S. Bank TruPS CDO Upgrades to Slow, Fitch Says
[*] Reduced Liquidity Ahead for US Midstream Issuers, Fitch Says
[*] The Deal Announces Results of Q3 2015 Bankruptcy League Tables
[] Quarterly Losses Reverse Course for Credit Card ABS, Fitch Says
[^] Large Companies with Insolvent Balance Sheet
*********
AMERICAN AGENCIES: U.S. Trustee Objects to Cash Use Request
-----------------------------------------------------------
Guy G. Gebhardt, Acting United States Trustee for Region 21,
objects to the joint stipulation for use of cash collateral and
adequate protection among secured creditor Banco Popular de Puerto
Rico (BPPR), American Agencies Co., Inc. and New Steel, Inc.
The U.S. Trustee asserts that the the Stipulation fails to comply
with P.R. LBR 4001-2(a), inasmuch as it does not include "a
self-contained, proposed form of order," nor does it state "the
value of the collateral that secures the creditor's asserted
interest." The U.S. Trustee also complains that the Amended Budget
also does not comply with P.R. LBR 4001-2(a), inasmuch as it does
not provide for "carve-outs for United States trustee . . . fees."
The U.S. Trustee further objects to any alleged agreement to impose
any limitation to the rights and/or scope of the statutory duties,
powers and/or responsibilities pursuant to the Bankruptcy Code
and/or applicable rules of "any party in interest," including the
United States Trustee, and any subsequent Chapter 7 or Chapter 11
trustee, or examiner.
In the stipulation, the BPPR consents to the Debtors' use of BPPR's
cash collateral to satisfy their operating expenses commencing as
of the Petition Date and ending on March 15, 2016, or the date that
a plan is confirmed, whichever date is the earliest. According to
the parties, it is critical and necessary to provide and assure the
continuity of the Debtors' business, payment of operational
expenses, and the preservation of the going concern value of the
Debtors' estate.
As adequate protection for BPPR for the use of the Cash Collateral,
the Debtors agree to pay to BPPR the monthly installments of
$16,670. In addition, as adequate protection for BPPR, the Debtors
grant to BPPR a replacement lien and a post-petition security
interest on all of the assets of the same type of property of the
estate against which BPPR held liens as of the Petition Date, which
are acquired by the Debtors, on and after the Petition Date.
Moreover, the Debtors agree that, upon any consummation of any sale
of substantially all or any of the Debtors' assets securing the
obligations under the loan documents or upon the effective date of
a plan confirmed by the Debtors, whichever comes first, all of the
Net Proceeds of the sale will be paid immediately and indefeasibly
to BPPR for its benefit at the closing of the sale in an amount
equivalent to the outstanding balance of the Loans at that time,
including any post-petition interest and/or charges that may have
secured in accordance with the loan documents and the bankruptcy
code.
The Debtors are represented by:
Luisa S. Valle Castro, Esq.
C.CONDE & ASSOC.
254 San Jose Street, 5th Floor
Old San Juan, Puerto Rico 00901
Tel: (787) 729-2900
Fax: (787) 729-2203
Email: ls.valle@condelaw.com
Guy G. Gebhardt, Acting United States Trustee for Region 21, is
represented by:
Julio Guzmán-Carcache, Esq.
THE UNITED STATES TRUSTEE
Edificio Ochoa
500 Tanca Street, Suite 301
San Juan, Puerto Rico 00901-1922
Tel.: (787) 729-7444
Fax: (787) 729-7449
Email: julio.guzman@usdoj.gov
About American Agencies
American Agencies Co., Inc. and New Steel, Inc., manufacturers of
steel structures, filed Chapter 11 bankruptcy petitions (Bankr. D.
P.R. Case Nos. 15-07088 and 15-07090, respectively) on Sept. 15,
2015. The petition was signed by Omir Mendez as president.
The Debtors sought substantive consolidation of their cases under
Lead Case 15-07088.
C. Conde & Associates represents the Debtors as counsel. Doris
Barroso Vicens, CPA, at RSM ROC & Company, serves as the Debtors'
accountant.
AMERICAN AXLE: Posts $60.9 Million Net Income for Third Quarter
---------------------------------------------------------------
American Axle & Manufacturing Holdings, Inc., filed with the
Securities and Exchange Commission its quarterly report on Form
10-Q disclosing net income of $60.9 million on $972 million of net
sales for the three months ended Sept. 30, 2015, compared to net
income of $44 million on $951 million of net sales for the same
period in 2014.
For the nine months ended Sept. 30, 2015, the Company reported net
income of $173 million on $2.94 billion of net sales compared to
net income of $129.8 million on $2.75 billion of net sales for the
same period during the prior year.
As of Sept. 30, 2015, the Company had $3.39 billion in total
assets, $3.17 billion in total liabilities, and $227 million in
total stockholders' equity.
"AAM's financial results in the third quarter of 2015 reflect
strong operating cash flow generation and profitability driven by
solid production volumes across many of our major product programs
supporting the North American light vehicle segment and continued
operational execution," said AAM's Chairman & Chief Executive
Officer, David C. Dauch. "As we progress towards our 2015
financial targets, our team remains committed to improving our
capital structure while leveraging AAM's technology leadership to
develop innovative solutions that will allow us to profitably grow
while exploring strategic growth opportunities."
A full-text copy of the Form 10-Q is available for free at:
http://is.gd/Kd6qAs
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.
AMERICAN NATURAL ENERGY: Has Interim OK to Tap Hillair DIP Loan
---------------------------------------------------------------
Judge Elizabeth W. Magner of the United States Bankruptcy Court for
Eastern District of Louisiana signed off an interim order
authorizing American Natural Energy Corporation to obtain
postpetition secured financing in the amount of up to $260,000 from
Hillair Capital Investments, LP, to fund the Debtor's efforts to
restore production and its continued operations in Chapter 11.
The DIP Loan carries a 12% non-default interest rate.
The DIP Loan is be entitled to a superpriority, priming first
position rank in accordance with Section 364(d)(1) of the
Bankruptcy Code with respect to ANEC's leasehold interests,
including but not limited to all the interests in the Bayou Couba
Field, in St. Charles Parish, Louisiana, inventory, receivables and
cash to the extent of advances outstanding up to $260,000.
Moreover, $100,000 of the DIP Loan is specifically authorized for
"Working Capital" expenses. The remaining $160,000 of the DIP Loan
will cover the "Upgrades to Vessel Containment" expenses, namely
the costs of the environmental engineer and repairs and
improvements necessary to bring the vessels into compliance with
applicable law.
Hillair will be entitled to an administrative expense claim to the
extent of the Loans actually advanced, plus accrued interest
thereon.
American Natural Energy Corporation is represented by:
Jan M. Hayden, Esq.
Edward H. Arnold, III, Esq.
Patrick H. Willis, Esq.
BAKER DONELSON BEARMAN CALDWELL & BERKOWITZ, PC
201 Street Charles Avenue, Suite 3600
New Orleans, LA 70170
Tel: (504) 566-5200
Fax: (504) 636-4000
Email: jhayden@bakerdonelson.com
harnold@bakerdonelson.com
pwillis@bakerdonelson.com
About American Natural
American Natural Energy Corporation, a Tulsa, Oklahoma-based
independent exploration and production company with operations in
St. Charles Parish, Louisiana, was subjected to an involuntary
Chapter 11 petition on Aug. 31, 2015 (Bankr. E.D. La., Case No.
15-122290), by Reamco, Inc., C&M Contractors, Inc., Bayou Fuel
Marine & Hardware Supplies, Inc., and Hillair Capital Investments,
L.P. The Petitioners are represented by Philip Kirkpatrick Jones,
Jr., Esq., at Liskow & Lewis, in New Orleans, Louisiana; and
Michael A. Crawford, Esq., at Taylor, Porter, Brooks & Phillips
LLP, in Baton Rouge, Louisiana.
ARCHDIOCESE OF MILWAUKEE: Bid to Appeal Denied as Moot
------------------------------------------------------
Judge Lynn Adelman of the United States District Court for the
Eastern District of Wisconsin denied the Archdiocese of Milwaukee's
motion for leave to appeal a decision of the bankruptcy court that
it lacked subject matter jurisdiction to approve the Debtor's
proposed reorganization plan pending an appeal in related
litigation in the Seventh Circuit.
In June 2011, the Archbishop filed an adversary proceeding as
trustee of the Cemetery Trust seeking an order declaring that the
Cemetery Trust's funds are not property of the Archdiocese's
estate. In January 2013, the bankruptcy court granted partial
summary judgment, concluding that the Religious Freedom and
Restoration Act and the First Amendment did not preclude inclusion
of the Cemetery Trust in the Archdiocese's estate. The Archbishop
appealed, and in July 2013, the district court reversed the
bankruptcy court and instead granted summary judgment in favor of
the Archbishop, concluding that RFRA and the First Amendment
preclude inclusion of the Cemetery Trust in the Archdiocese's
estate. The Appellee, Committee of Unsecured Creditors, appealed
that decision to the Seventh Circuit, and at the time the motion
for leave to appeal was filed, the Cemetery Trust litigation was
still pending before the Seventh Circuit.
In February 2014, the appellant filed a proposed reorganization
plan in the bankruptcy action. That plan included a provision for
the settlement of the Cemetery Trust litigation. Appellee filed a
motion arguing that the bankruptcy court lacked subject matter
jurisdiction to consider the plan because it included settlement of
the Cemetery Trust litigation, which was still pending before the
Seventh Circuit. The bankruptcy court agreed and canceled the
hearing that had been scheduled to confirm the plan. It is this
decision that appellant seeks to appeal.
The issue presented on appeal is whether the pending appeal in the
Cemetery Trust litigation stripped the Bankruptcy Court of subject
matter jurisdiction to confirm appellant's proposed plan insofar as
the plan provides for the settlement and dismissal of the Cemetery
Trust litigation. Since appellant filed its motion for leave to
appeal, the Seventh Circuit decided the Cemetery Trust litigation,
reversing the district court. The Cemetery Trust litigation has
been remanded and re-referred to the bankruptcy court for further
action.
Judge Adelman pointed out that the Archdiocese has put forth an
amended reorganization plan, which the court will consider at a
confirmation hearing scheduled for November. Based on these
developments, there no longer appears to be an active case or
controversy, Judge Adelman held. There is no longer a pending
appeal and no longer a question as to whether the bankruptcy court
has subject matter jurisdiction to move forward with the bankruptcy
action, Judge Adelman concluded.
The case is captioned ARCHDIOCESE OF MILWAUKEE, Appellant, v.
OFFICIAL COMMITTEE OF UNSECURED CREDITORS, Appellee, CASE NO.
14-CV-0848, WIEB NO. 11-20059 (E.D. Wis.).
A full-text of the Order dated September 29, 2015 is available at
http://is.gd/3hXkYsfrom Leagle.com.
Archdiocese of Milwaukee, Appellant, represented by Andrew A Jones,
Esq.-- ajones@whdlaw.com -- WHYTE HIRSCHBOECK DUDEK SC, Bruce G
Arnold, Esq.-- barnold@whdlaw.com -- WHYTE HIRSCHBOECK DUDEK SC,
Daryl L Diesing, Esq.-- ddiesing@whdlaw.com -- WHYTE HIRSCHBOECK
DUDEK SC, Francis H LoCoco, Esq.-- flococo@whdlaw.com -- WHYTE
HIRSCHBOECK DUDEK SC & Lindsey M Greenawald, Esq.--
lgreenawald@whdlaw.com -- WHYTE HIRSCHBOECK DUDEK SC
Official Committee of Unsecured Creditors, Appellee, represented by
Albert Solochek, Esq. -- alsolochek@hswmke.com -- HOWARD SOLOCHEK &
WEBER, James I Stang, Esq. -- jstang@pszjlaw.com -- PACHULSKI STANG
ZIEHL & JONES LLP, Jason R Pilmaier, Esq. -- jpilmaier@hswmke.com
-- HOWARD SOLOCHEK & WEBER, Kenneth H Brown, Esq. --
kbrown@pszjlaw.com -- PACHULSKI STANG ZIEHL & JONES, Eric S Teske,
Esq. -- eteske@hswmke.com -- HOWARD SOLOCHEK & WEBER & Gillian N
Brown, Esq. -- gbrown@pszjlaw.com -- PACHULSKI STANG ZIEHL & JONES
LLP.
About Archdiocese of Milwakee
The Diocese of Milwaukee was established on Nov. 28, 1843, and
was elevated to an Archdiocese on Feb. 12, 1875, by Pope Pius
IX. The region served by the Archdiocese consists of 4,758 square
miles in southeast Wisconsin which includes counties Dodge, Fond
du Lac, Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth,
Washington and Waukesha. There are 657,519 registered Catholics
in the Region.
The Catholic Archdiocese of Milwaukee, in Wisconsin, filed for
Chapter 11 bankruptcy protection (Bankr. E.D. Wis. Case No.
11-20059) on Jan. 4, 2011, to address claims over sexual abuse
by priests on minors.
The Archdiocese became at least the eighth Roman Catholic diocese
in the U.S. to file for bankruptcy to settle claims from current
and former parishioners who say they were sexually molested by
priests.
Daryl L. Diesing, Esq., at Whyte Hirschboeck Dudek S.C., in
Milwaukee, Wisconsin, serves as the Archdiocese's counsel. The
Official Committee of Unsecured Creditors in the bankruptcy case
has retained Pachulski Stang Ziehl & Jones LLP as its counsel, and
Howard, Solochek & Weber, S.C., as its local counsel.
The Archdiocese estimated assets and debts of $10 million to
$50 million in its Chapter 11 petition.
B. P. GREER RECYCLING: Case Summary & 20 Top Unsecured Creditors
----------------------------------------------------------------
Debtor: B. P. Greer Recycling, Inc.
219 Watlington Industrial Drive
Reidsville, NC 27320
Case No.: 15-11192
Chapter 11 Petition Date: October 30, 2015
Court: United States Bankruptcy Court
Middle District of North Carolina (Greensboro)
Judge: Hon. Catharine R. Aron
Debtor's Counsel: Charles M. Ivey, III, Esq.
IVEY, MCCLELLANn, GATTON, & SIEGMUND, LLP
Suite 500
100 S. Elm St.
Greensboro, NC 27401
Tel: 336-274-4658
Fax: 336-274-4540
Email: jlh@imgt-law.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Thomas McGoldrick, receiver.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/ncmb15-11192.pdf
BEHAVIORAL SUPPORT: Has Deals for Return of $5-Mil. to Estate
-------------------------------------------------------------
Behavioral Support Services, Inc., asks the United States
Bankruptcy Court for the Middle District of Florida, Orlando
Division, to approve multiple proposed compromises of controversies
related to prepetition cash transfers and real property purchases.
The Debtor tells the Court that if approved, the proposed
compromises will result in settlement of controversies regarding
significant transfers and assets totaling approximately $7 million
with assets valued at as much as $5 million being returned to the
estate.
Behavioral Support Services, Inc. is represented by:
Tiffany D. Payne, Esq.
BAKER & HOSTETLER LLP
200 S. Orange Ave.
SunTrust Center, Suite 2300
Orlando, FL 32801-3432
Tel: (407) 649-4000
Fax: (407) 841-0168
Email: tpayne@bakerlaw.com
About Behavioral Support Services
Altamonte Springs, Florida-based Behavioral Support Services, Inc.,
is an operator of an out-patient mental health care facility.
The Company sought Chapter 11 protection (Bankr. M.D. Fla. Case No.
15-bk-04855) on June 2, 2015.
According to the docket, the Debtor's Chapter 11 plan and
disclosure statement are due Sept. 30, 2015.
The Debtor tapped Elizabeth A. Green, Esq., at Baker &
Hostetler LLP, as counsel.
BOOMERANG TUBE: Parties Submit Post-Trial Briefs on Plan
--------------------------------------------------------
Following a confirmation hearing trial on Sept. 21-22, 24, and Oct.
5, 2015, the key parties in the Chapter 11 cases of Boomerang Tube,
LLC, et al., submitted post-trial briefs in support -- or
opposition -- to confirmation of the Debtors' Amended Joint
Prearranged Chapter 11 Plan dated Sept. 14, 2015.
The Official Committee of Unsecured Creditors, which is opposing
confirmation, says the Debtors' proposal to hand over all of the
value of Reorganized Boomerang to the term lenders while leaving
unsecured creditors out in the cold with a de minimis recovery
would result in a violation of the absolute priority rule. The
Committee notes that it is the Debtors' burden to prove their
valuation case to the Court -- which, all along, has been that the
Reorganized Debtors' total enterprise value ("TEV") is less than
the amount of their debt obligations (the "Funded Debt Hurdle").
According to the Committee, the evidence adduced at trial
established a value for the Debtors ranging between $312.0 million
and $361.0 million; the midpoint of that valuation range ($335.0
million) exceeds the Funded Debt Hurdle ($302.9 million).
SB Boomerang Tubular also submitted a post-confirmation-hearing
brief in opposition to the Plan. SBBT says that the Debtors and
Black Diamond are aggressively advocating for an unjustifiably low
valuation of a heat treat line in an effort to secure an $8 million
windfall by retaining income-generating equipment at a steep
discount -- at SBBT's expense. SBBT states it would not oppose the
Debtors' retention of SBBT's equipment as long as SBBT were
adequately compensated in accordance with the Bankruptcy Code's
protections for lessors1 or secured creditors. SBBT says it
objects to the Plan because (i) the Plan improperly seeks to
recharacterize a true lease as a secured financing; (ii) upon such
recharacterization, the Plan uses an unreasonably low value for the
collateral securing the Debtors' obligations, thereby unfairly
diminishing the amount of SBBT's secured claim; (iii) the Plan does
not satisfy the Bankruptcy Code's provisions for creditors such as
SBBT that have taken the election under Sec. 1111(b) because the
proposed payment terms are neither "fair and equitable" nor
feasible; and (iv) the Plan improperly places SBBT in line for
payment behind an invalid claim manufactured by the Debtors and not
asserted by the supposed creditor.
In a brief responding to SBBT's assertions, the Debtors argue
that:
* SBBT's argument that the agreement is a "true lease" amounts
to painting stripes on a horse. SBBT submitted no evidence that
the payments under the putative lease agreement were based upon a
market rent or usage charge for similar equipment or that SBBT had
the requisite "entrepreneurial stake" in the value of the equipment
at the end of the term.
* On the valuation point, the Debtors -- guided by clear
directives from the Supreme Court and the Third Circuit Court of
Appeals that "replacement value" is the proper standard for
valuation of collateral that the debtor proposes to retain under a
plan -- hired an experienced appraiser of industrial equipment
within the oil and gas industries to provide an opinion of what it
would cost. Applying accepted appraisal methodologies, he
determined this amount was $4.5 million.
* As to the issue of the Plan's treatment of SBBT's secured
claim, SBBT's arguments are moot because it has no secured claim --
the entire value of the collateral is subject to the senior lien of
SBBT's own lender, which constitutes a "claim" against Boomerang
that must be properly treated under the Plan. The Plan's proposed
treatment of SBBT's claim is appropriate in light of the cram-down
standard applicable to Sec. 1111(b)(2)-electing secured creditors
such as SBBT.
In response to the Committee's claims, the Debtors contend that, to
find that the Plan meets the "fair and equitable" requirement of
section 1129(b) of the Bankruptcy Code, the Court need not
determine the exact enterprise value of the Debtors; instead, the
Court need only find that the Debtors have shown by a preponderance
of the evidence that their total enterprise value ("TEV") does not
exceed the Debt Hurdle of $312 million or even the Creditors
Committee's own artificially low hurdle of $302.9 million. The
Debtors believe that they have met this burden, noting that
Lazard's report establishes that the Debtors have a midpoint TEV of
$210 million -- or more than $100 million below the Debt Hurdle.
On the other hand, the Debtors aver that Alvarez & Marsal's view
that unsecured creditors are "in the money" is against the great
weight of the evidence is in contrast to A&M's own flawed
comparable companies analysis. The Debtors claim, among other
things that, A&M is artificially inflating its valuation conclusion
by adding $21 million of "cost savings" related to potential deals
with the Debtors' foreign steel supplier and one of its quality
control vendors that are not otherwise included as part of the
financial projections.
"Notwithstanding the Creditors Committee's view that its
constituency is in the money -- with a putative valuation of well
in excess of $300,000,000 -- not a single alternative to the Plan
has been presented, or even suggested, let alone one with viable
and committed financing," the Debtors point out.
A copy of the Committee' Post-Trial Brief is available at:
http://bankrupt.com/misc/Boomerang_T_622_PT_Brief_UCC.pdf
http://bankrupt.com/misc/Boomerang_T_623_PT_Brief_UCC_Exh.pdf
A copy of SBBT's Post-Trial Brief is available at:
http://bankrupt.com/misc/Boomerang_T_628_PT_Brief_SBBT.pdf
Copies of the Debtors' Post-Trial Briefs are available at:
http://bankrupt.com/misc/Boomerang_T_629_PT_Brief_BT.1.pdf
http://bankrupt.com/misc/Boomerang_T_632_PT_Brief_BT.2.pdf
Further Amendments to PSA
On Oct. 8, 2015, the Debtors entered into the (i) Third Amendment
to Plan Support Agreement, (ii) Forbearance Agreement and Amendment
No. 1 to Debtor-In-Possession Credit Agreement related to the DIP
ABL Facility, and (iii) Forbearance Agreement related to the DIP
Term Facility. A copy of the filing is available for free at:
http://bankrupt.com/misc/Boomerang_T_640_3rd_Am_PSA.pdf
The Debtors' attorneys:
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Robert S. Brady, Esq.
Sean M. Beach, Esq.
Margaret Whiteman Greecher, Esq.
Patrick A. Jackson, Esq.
Ryan M. Bartley, Esq.
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
E-mail: rbrady@ycst.com
sbeach@ycst.com
mgreecher@ycst.com
pjackson@ycst.com
rbartley@ycst.com
The Creditors Committee's counsel:
MORRIS NICHOLS ARSHT & TUNNELL LLP
Derek C. Abbott, Esq.
Curtis S. Miller, Esq.
Daniel B. Butz, Esq.
1201 North Market Street, Suite 1600
Wilmington, DE 19801
Telephone: (302) 658-9200
Facsimile: (302) 658-3989
E-mail: dabbott@mnat.com
cmiller@mnat.com
mkoch@mnat.com
- and -
BROWN RUDNICK LLP
Steven D. Pohl, Esq.
Sunni P. Beville, Esq.
One Financial Center
Boston, MA 02111
Telephone: (617) 856-8200
Facsimile: (617) 856-8201
E-mail: spohl@brownrudnick.com
sbeville@brownrudnick.com
Bennett S. Silverberg
7 Times Square
New York, NY 10036
Telephone: (212) 209-4800
Facsimile: (212) 209-4801
E-mail: bsilverberg@brownrudnick.com
SB Boomerang Tube's counsel:
PEPPER HAMILTON LLP
David M. Fournier, Esq.
Michael J. Custer, Esq.
Hercules Plaza, Suite 5100
1313 N. Market Street
P.O. Box 1709
Wilmington, Delaware 19801-1709
Telephone: (302) 777-6500
Facsimile: (302) 421-8390
E-mail: fournierd@pepperlaw.com
custerm@pepperlaw.com
- and -
Judith W. Ross, Esquire
Eric Soderlund, Esquire
LAW OFFICES OF JUDITH W. ROSS
700 North Pearl Street, Suite 1610
Dallas, Texas 75201
Telephone: 214-377-7879
Facsimile: 214-377-9409
E-mail: Judith.ross@judithwross.com
eric.soderlund@judithwross.com
* * *
The Debtors' filed their Amended Joint Prearranged Chapter 11 Plan
dated Sept. 4, 2015 (the "Plan").
Objections to confirmation of the Plan were timely filed by the
Sept. 14 deadline by: (i) Cypress-Fairbanks ISD and Harris County;
(ii) the "Texas Taxing Entities" as defined in such objection;
(iii) the U.S. Trustee; (iv) SB Boomerang Tubular, LLC ("SBI"); and
(v) the Creditors Committee.
On Sept. 18, 2015, the Debtors filed their response to Plan
objections (the "Response").
On Sept. 21, 22 and 24, and on Oct. 5, 2015, the Court held a
hearing on the Plan and the objections and directed the parties to
submit post-hearing briefs no later than Oct. 16, 2015.
The Debtors' Plan
The Debtors have proposed a Joint Prearranged Plan that reduces
their funded debt obligations by converting approximately $214
million in outstanding principal of term loan facility obligations
(Class 4) into (i) 100% of the New Holdco common stock, subject to
dilution, and (ii) $55 million of subordinated secured notes issued
by New Opco.
The prepetition revolving credit facility lenders under the ABL
facility (Class 3) will receive payment in full all accrued
obligations under the ABL Facility. The ABL Facility Lenders
provided the $85 million DIP ABL Facility and have committed to
provide an Exit ABL Facility.
The holders of the SBI secured claims (Class 5) will receive a
secured note.
The Plan provides for the creation of a post-Effective Date vehicle
(the "GUC Trust") which will retain and liquidate all Avoidance
Actions (the "GUC Trust Assets") for the benefit of holders of
general unsecured claims (Class 6).
Holders of preferred units (Class 9) and common units (Class 10),
other equity securities (Class 11), and Section 510(b) clams (Class
2) won't receive any distribution.
A copy of the Debtors' Amended Joint Prearranged Chapter 11 Plan
filed Sept. 4, 2014, is available for free at:
http://bankrupt.com/misc/Boomerang_Am_Plan_Sep2015.pdf
A black-lined copy of the Amended Disclosure Statement filed Aug.
13, 2015, is available for free at:
http://bankrupt.com/misc/Boomerang_T_Am_DS_BL.pdf
About Boomerang Tube
Boomerang Tube, LLC, is a manufacturer of welded Oil Country
Tubular Goods ("OCTG") in the United States. OCTG are used by
drillers in exploration and production of oil and natural gas and
consist of drill pipe, casing and tubing. Boomerang has corporate
offices in Chesterfield, Missouri and manufacturing facilities in
Liberty, Texas, strategically located near major steel production
centers and end-user markets. With a 487,000 square foot plant
that houses two mills and heat treat lines and a contingent 119
acres, these facilities constitute the second largest alloy OCTG
mill in North America. Access Tubulars, LLC, owns 81% of the
equity interests in Boomerang.
Boomerang Tube and its subsidiaries BTCSP LLC and BT Financing
sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
15-11247) on June 9, 2015, with a deal with lenders on a balance
sheet restructuring that would convert $214 million of debt to 100%
of the common stock of the reorganized company.
The cases are assigned to Judge Mary F. Walrath.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP, as
attorneys; Lazard Freres & Co. LLC, as financial advisor; and
Donlin, Recano & Co., Inc., as claims and noticing agent.
* * *
Boomerang Tube secured approval of its Amended Disclosure Statement
in support of its Prearranged Chapter 11 Plan.
Judge Mary F. Walrath on Sept. 21, 2015, began the hearing to
consider confirmation of the Debtors' Amended Joint Prearranged
Chapter 11 Plan filed Sept. 4, 2015. The Debtors anticipate that
the confirmation hearing will take multiple days over a few weeks,
given the Court's and parties' calendars.
BUDD COMPANY: Plan Hinges on Settlement with Parent
---------------------------------------------------
Former automotive parts supplier The Budd Company, Inc., has filed
a Chapter 11 plan that proposes to pay off claims from cash on hand
and the proceeds of a yet to be finalized settlement with parent
ThyssenKrupp North America, Inc. ("TKNA").
The Debtor, which has ceased operations, had approximately $300
million in cash, as of Aug. 31, 2015. During the course of the
bankruptcy case to date, the Debtor generally has spent between $4
million and $5 million each month on retiree benefits.
The Debtor also holds claims and causes of action against TKNA and
other parties that may be worth hundreds of millions of dollars.
To monetize the Debtor's largest causes of action, the Plan seeks
approval of the TKNA Settlement Agreement, whereby TKNA will, among
other things, pay directly to the UAW VEBA on behalf of the Debtor
[$______] in annual installments of approximately [$______] million
beginning on [_______] and assume the pension plans and certain
other obligations of the Debtor, in exchange for a general release
of itself, its affiliates, Clark Hill, and their respective
employees and other agents.
The Debtor and TKNA are engaged in advanced settlement discussions
and hope to finalize the TKNA Settlement Agreement. The Debtor is
keeping counsel to the UAW and Retiree Committee informed of these
discussions, gave them an advanced version of the Plan, and has
urged them to contact counsel to TKNA to further discussions. The
Debtor will file the Settlement Agreement and an amended Disclosure
Statement and Plan if and when it reaches final terms with TKNA on
a TKNA Settlement Agreement.
Pursuant to the Plan, holders of non-priority tax claims (Class 1)
and secured claims (Class 2) are expected to have a 100% recovery.
The 4,275 holders of UAW retiree benefit claims owed a total of
$799 million (Class 3) and the 1,093 holders of E&A retiree benefit
claims owed $97 million (Class 4) will be paid from cash on hand
and proceeds of causes of action. As to asbestos claims (Class 5),
allowed insured asbestos claims will be paid from insurance
policies and an asbestos insured claim fund created by the Debtor
and the allowed uninsured claims will be made solely from an
uninsured asbestos claim fund. Holders of 11 general unsecured
claims totaling $5 million (Class 6) will receive cash from the
Debtor. As for holders of equity interests (Class 7), TKNA will
retain 100% of the equity interests in the Debtor in accordance
with the TKNA Settlement Agreement. The present iteration of the
Disclosure Statement does not provide for the estimated percentage
recovery for Classes 3, 4, 5 and 6.
A copy of the Disclosure Statement explaining the terms of the Plan
dated Sept. 30, 2015 is available for free at:
http://bankrupt.com/misc/Budd_Co_1134_DS.pdf
About The Budd Company
The Budd Company, Inc., a former supplier to the automotive
industry, filed for chapter 11 bankruptcy protection (Bankr. N.D.
Ill. Case No. 14-11873) on March 31, 2014, with a deal to settle
potential claims against its parent, ThyssenKrupp AG.
The company -- which ceased manufacturing operations in 2006 and
does not have any current employees, facilities or customers --
has obligations consisting largely of medical and other benefits
to
approximately 10,000 former employees.
Liabilities amount to approximately $1 billion with assets of
approximately $400 million. Most of the debt consists largely of
medical and other benefits to approximately 10,000 former
employees.
The Debtor disclosed $387,555,681 in assets and $1,107,350,034 in
liabilities as of the Chapter 11 filing.
The Hon. Jack B. Schmetterer oversees the case. The Debtor has
tapped Proskauer Rose LLP as Chapter 11 counsel, Dickinson Wright
PLLC as special counsel, Epiq Bankruptcy Solutions, LLC as
noticing, claims and balloting agent, and Conway MacKenzie
Management Services, LLC's Charles M. Moore as CRO.
The U.S. Trustee appointed five individuals to serve on the
Committee of Executive & Administrative Retirees. The Segal
Company (Eastern States), Inc. serves as the Committee's actuarial
consultant. The Committee retained Solic Capital Advisors, LLC as
its financial advisor.
Reed Heiligman, Esq., at FrankGecker LLP, in Chicago, Illinois,
represents the ad hoc committee of asbestos personal injury
claimants.
CASH STORE: Chapter 15 Recognition Hearing on Nov. 24
-----------------------------------------------------
The Hon. Michael E. Willes of the U.S. Bankruptcy Court for the
Southern District of New York will hold a hearing on Nov. 24, 2015,
at 11:00 a.m. (ET) in Courtroom 617, One Bowling Green in New York,
New York, to consider approval of the request filed by The Cash
Store Financial Services Inc. seeking recognition of its Canada's
Companies' Creditors Arrangement proceeding as a "foreign main
proceeding, and enforcement in the United States of certain
provisions of the Debtor's plan of compromise and arrangement under
the CCAA including the securities class action captioned Globis
Capital Partners L.P. et al. v. Cash Store Financial Services Inc.
et al. Civ. 3385 (S.D.N.Y.). Objections, if any, are due Nov. 17,
2015, at 4:00 p.m. (ET).
About Cash Store Financial
Cash Store Financial and Instaloans primarily act as lenders to
facilitate short-term advances and provide other financial services
to income-earning consumers who may not be able to obtain them from
traditional banks. Cash Store Financial also provides
private-label debit cards.
Cash Store Financial is not affiliated with Cottonwood Financial
Ltd. or the outlets Cottonwood Financial Ltd. operates in the
United States under the name "Cash Store". Cash Store Financial
does not do business under the name "Cash Store" in the United
States and does not own or provide any consumer lending services in
the United States.
Cash Store Financial reported a net loss and comprehensive loss of
C$35.5 million for the year ended Sept. 30, 2013, as compared with
a net loss and comprehensive loss of C$43.5 million for the year
ended Sept. 30, 2012. As of Sept. 30, 2013, the Company had C$165
million in total assets, C$166 million in liabilities, and a C$1.32
million shareholders' deficit.
FTI Consulting Canada Inc., the court-appointed monitor and
authorized foreign representative of Cash Store, filed under
Chapter 15 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No.
15-12813) on Oct. 16, 2015. Cash Store estimated assets in the
range of $50 million to $100 million and liabilities of more than
$100 million.
Judge Michael E. Wiles presides over the Debtor's case.
Kenneth P. Coleman, Esq., at Allen & Overy LLP, represents FTI
Consulting.
The Debtor estimated assets between $50 million and $100 million,
and debts of between $100 million and $500 million.
CHINA MEDICAL: Ruling Sustaining Professionals' Claims Reversed
---------------------------------------------------------------
Kenneth M. Krys appeals from an order of the U.S. Bankruptcy Court
for the Southern District of New York sustaining the claims of
attorney-client privilege and work product protection asserted by
Paul, Weiss, Rifkind, Wharton & Garrison LLP and AlixPartners, LLP.
Judge Ronnie Abrams of the United States District Court for the
Southern District of New York reversed the ruling of the Bankruptcy
Court and remanded the case for further proceedings.
The case is captioned IN RE: CHINA MEDICAL TECHNOLOGIES, INC.
KENNETH M. KRYS, the Foreign Representative of China Medical
Technologies, Inc., Appellant, v. PAUL, WEISS, RIFKIND, WHARTON,
GARRISON LLP, and ALIXPARTNERS, LLP, Appellees, NOS. 12-BR-13736
(REG), 15-CV-0167 (RA).
A full-text of the Opinion and Order dated September 30, 2015 is
available at http://is.gd/xB3Ifwfrom Leagle.com.
Kenneth M. Krys, Appellant, represented by Eric L. Lewis, Esq. --
eric.lewis@lewisbaach.com -- Lewis Baach PLLC & Jack B. Gordon,
Esq. -- jack.gordon@lewisbaach.com -- Lewis Baach Kaufmann
Middlemiss
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Appellee, represented
by Daniel John Toal, Esq. -- dtoal@paulweiss.com -- Paul, Weiss,
Rifkind, Wharton & Garrison LLP, Robert A. Atkins, Esq. --
ratkins@paulweiss.com -- Paul, Weiss, Rifkind, Wharton & Garrison
LLP, Stephen J. Shimshak, Esq. -- sshimshak@paulweiss.com -- Paul,
Weiss, Rifkind, Wharton & Garrison & Robert Neil Kravitz, Esq. --
rkravitz@paulweiss.com -- Paul, Weiss, Rifkind, Wharton & Garrison
LLP.
About China Medical
China Medical Technologies Inc., a maker of diagnostic products,
filed a Chapter 15 bankruptcy petition in New York to locate money
fraudulently transferred by its principals.
The Debtor, which has been taken over by a trustee, is undergoing
corporate winding-up proceedings before the Grand Court of the
Cayman Islands. Kenneth M. Krys, the joint official liquidator,
wants U.S. courts to recognize the Cayman proceeding as the
"foreign main proceeding" The liquidator filed a Chapter 15
petition for China Medical (Bankr. S.D.N.Y. Case No. 12-13736) on
Aug. 31, 2012. Curtis C. Mechling, Esq., at Stroock & Stroock &
Lavan, LLP, in New York, serves as counsel.
Cosimo Borrelli and Yuen Lai Yee (Liz) on Nov. 29, 2012, were
appointed as liquidators of China Medical Technologies Inc.
The liquidators may be reached at:
Cosimo Borrelli
Yuen Lai Yee (Liz)
Level 17, Tower 1
Admiralty Centre
18 Harcourt Road
Hong Kong
CLAIREX TECHNOLOGIES: Case Summary & 20 Top Unsecured Creditor
--------------------------------------------------------------
Debtor: Clairex Technologies, Inc.
1000 Jupiter Road, 100
Plano, TX 75074
Case No.: 15-41935
Chapter 11 Petition Date: October 30, 2015
Court: United States Bankruptcy Court
Eastern District of Texas (Sherman)
Judge: Hon. Brenda T. Rhoades
Debtor's Counsel: Robert T. DeMarco, Esq.
DEMARCO MITCHELL, PLLC
1255 West 15th St., 805
Plano, TX 75075
Tel: 972-578-1400
Fax: 972-346-6791
Email: robert@demarcomitchell.com
Estimated Assets: $50,000 to $100,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by David W. Catter, Sr., CEO.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/txeb15-41935.pdf
COLT HOLDING: Disclosure Statement Hearing on Nov. 6
----------------------------------------------------
Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for
the District of Delaware will convene a hearing on Nov. 6, 2015 at
10:00 a.m. (Eastern Standard Time) to consider approval of the
disclosure statement explaining Colt Holding Company, LLC, et al.'s
Joint Plan of Reorganization. Objections to the adequacy of the
information in the Disclosure Statement were due Oct. 30.
As reported in the Oct. 13, 2015 edition of the TCR, the Debtors
have proposed a plan of reorganization premised on a $50 million
exit financing facility from private-equity owner Sciens Capital
Management, LLC, Fidelity National Financial Inc., Newport Global
Advisors LP, and certain other lenders.
The Debtors will raise $50 million in new capital from the private
Offering of Offering Units consisting of (i) third lien secured
debt to be issued pursuant to a third lien exit facility and (ii)
100% of the New Class A LLC Units. Participants in the private
Offering consist of the Sciens Group, certain members of the
Consortium, and Eligible Holders of Senior Notes Claims. The
aggregate new capital raised through the Offering may be increased
by up to $5 million.
Each Holder of an Allowed General Unsecured Claim will receive a
note -- subordinate to the Exit Facilities -- or other
consideration as reasonably agreed upon by the Debtors, the RSA
Creditor Parties, and the Term Loan Exit Lenders, such
consideration to represent a percentage of recovery that is
reasonably equivalent to the percentage of recovery realized by the
Holders of Allowed Senior Notes Claims. These Claims are Impaired
under the Plan.
A full-text copy of the Disclosure Statement dated Oct. 9, 2015, is
available at http://bankrupt.com/misc/COLTds1009.pdf
About Colt Defense
Colt Defense LLC is one of the world's oldest and most iconic
designers, developers, and manufacturers of firearms for military,
law enforcement, personal defense, and recreational purposes and
was founded over 175 years ago by Samuel Colt, who patented the
first commercial successful revolving cylinder firearm in 1836 and
began supplying U.S. and international military customers with
firearms in 1847. Colt is incorporated in Delaware and
headquartered in West Hartford, Connecticut.
In 1992, Colt Manufacturing Company, then the principal operating
subsidiary, filed chapter 11 petitions (Bankr. D. Conn.). An
investment by Zilkha & Co. allowed CMC to confirm a chapter 11 plan
and emerge from Bankruptcy in 1994.
Sometime after 1994, majority ownership of the Company Transitioned
from Zilkha & Co. to Sciens Capital Management.
Colt Holding Company LLC and nine affiliates, including Colt
Defense LLC, on June 14, 2015, filed voluntary petitions (Bankr. D.
Del. Lead Case No. 15-11296) for relief under Chapter 11 of the
Bankruptcy Code to pursue a sale of the assets as a going concern.
Colt Defense estimated $100 million to $500 million in assets and
debt.
On June 16, 2015, the Court directed the joined administration of
the assets.
The Debtors tapped Richards, Layton & Finger, P.A., and O'Melveny
& Myers LLP, as attorneys, and Kurtzman Carson Consultants LLC as
claims and noticing agent. Perella Weinberg Partners L.P. is
acting as financial advisor of the Company, and Mackinac Partners
LLC is acting as its restructuring advisor.
Wilmington Savings Fund Society, FSB, as agent under the $13.3
million Term DIP Loan Agreement, is represented by Pryor Cashman
LLP's Eric M. Hellige, Esq.; and Willkie Farr & Gallagher LLP's
Leonard Klingbaum, Esq.
Cortland Capital Market Services LLC, as agent under the $6.67
million Senior DIP Credit Agreement, is represented by Holland &
Knight LLP's Joshua M. Spencer, Esq.; Stroock & Stroock & Lavan
LLP's Brett Lawrence, Esq.; and Osler, Hoskin & Harcourt LLP's
Richard Borins, Esq., and Tracy Sandler, Esq.
The U.S. Trustee for Region 3 appointed five creditors of Colt
Defense Inc. and its affiliates to serve on the official committee
of unsecured creditors. MagPul Industries Corp. has resigned from
the committee leaving only four Committee members.
Sciens Capital is represented by Skadden, Arps, Slate, Meagher &
Flom LLP's Anthony W. Clark, Esq., and Jason M. Liberi, Esq.
* * *
Colt's equity sponsor, Sciens Capital Management, has agreed to
act as a stalking horse bidder in a proposed asset sale. The
Debtors called off the bankruptcy auction after no potential buyers
emerged by an Oct. 16, 2015 deadline.
The Debtors on Oct. 9 filed a proposed plan of reorganization
premised on a $50 million exit financing facility from
private-equity owner Sciens Capital Management, LLC, Fidelity
National Financial Inc., Newport Global Advisors LP, and certain
other lenders. The Plan secures options for the Company to
continue operations in West Hartford, Connecticut on a long-term
basis.
CON-WAY INC: S&P Lowers CCR to 'B' & Removes from Watch Neg.
------------------------------------------------------------
Standard & Poor's Ratings Services said that it has lowered its
corporate credit rating on freight transportation and logistics
provider Con-way Inc. to 'B' from 'BBB-' and removed all of its
ratings on the company from CreditWatch, where S&P had placed them
negative implications on Sept. 10, 2015. The outlook is stable.
At the same time, S&P lowered its issue-level ratings on Con-way's
senior unsecured notes to 'CCC+' from 'BBB-', reflecting that the
ratings are now based on S&P's 'B' corporate credit rating on XPO,
and assigned a '6' recovery rating to the notes. The '6' recovery
rating indicates S&P's expectation for negligible recovery (0%-10%)
in the event of a default.
Following these actions, S&P withdrew its corporate credit rating
on Con-way Inc.
"We lowered our ratings on Con-way and removed them from
CreditWatch to reflect our view that the company's credit quality
is now aligned with that of XPO Logistics Inc. following the close
of XPO's acquisition of Con-way," said Standard & Poor's credit
analyst Michael Durand. "We then withdrew our corporate credit
rating on Con-way."
COUTURE HOTEL: Withdraws Exclusivity Extension Motion
-----------------------------------------------------
Couture Hotel Corporation, a/k/a Hugh Black-St. Mary Enterprises,
informs the U.S. Bankruptcy Court for the Northern District of
Texas, Dallas Division, that it is withdrawing its third motion to
extend the exclusive time to file and confirm its Plan of
Reorganization.
Couture Hotel is represented by:
Gerrit M. Pronske, Esq.
Jason P. Kathman, Esq.
PRONSKE GOOLSBY & KATHMAN, P.C.
15305 Dallas Pkwy., Ste. 300
Addison, Texas 75001
Telephone: (214)658-6500
Facsimile: (214)658-6509
E-mail: gpronske@pgkpc.com
jkathman@pgkpc.com
About Couture Hotel
Couture Hotel Corporation, fka Hugh Black-St Mary Enterprises,
Inc., owns and operates four hotels: a Wyndham Garden Inn in
Dallas, Texas, consisting of 356 rooms and remodeled in 2013; a
Howard Johnson in Corpus Christi, Texas, consisting of 140 rooms
and remodeled in 2012; a Howard Johnson in Las Vegas, Nevada,
consisting of 110 rooms and remodeled in 2012; and an independent
hotel in Las Vegas, Nevada (formerly branded as a Value Place),
consisting of 121 rooms and also remodeled in 2012. The Las Vegas
hotels are located at one of the entrances to Nellis Air Force
base in North Las Vegas. The Debtor owns the real property and
improvements, as well as the franchise rights to the hotels
(except for Las Vegas Value Place).
The Company sought Chapter 11 protection (Bankr. N.D. Tex. Case
No. 14-34874) in Dallas, Texas, on Oct. 7, 2014. The case is
assigned to Judge Barbara J. Houser.
The Debtor disclosed $20.8 million in assets and $27.8 million in
liabilities as of the Chapter 11 filing.
The Debtor tapped Mark Sean Toronjo, Esq., at Toronjo & Prosser
Law, as counsel.
No creditors' committee or other official committee been appointed
in the case.
* * *
The Bankruptcy Court on Sept. 2, 2015, entered a memorandum opinion
and order denying confirmation of the Debtor's confirmation of the
Second Amended Plan. The Debtor on Sept. 18 filed a Modified Third
Amended Plan of Reorganization that addresses each of the concerns
raised by the Court in its Sept. 2 opinion. The Debtor scheduled a
Nov. 2 hearing for approval of its motion to approve the Modified
Third Amended Plan as a modification of the plan pursuant to Rule
3019 of the Federal Rules of Bankruptcy Procedure, without
re-solicitation.
CUNNINGHAM LINDSEY: S&P Revises Outlook to Neg. & Affirms 'B' CCR
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its outlook
on Cunningham Lindsey U.S. Inc. to negative from stable and
affirmed the 'B' long-term corporate credit rating. S&P also
affirmed all issue ratings, including our 'B' rating and '3'
recovery rating on the company's first-lien credit facility, and
S&P's 'B-' rating and '5' recovery rating on the company's
second-lien facility.
In addition, S&P assigned its 'B' long-term corporate credit rating
to CL Intermediate Holdings I B.V. (Cunningham Lindsey), the parent
company where the audited financial statements reside. Cunningham
Lindsey U.S. Inc. is an operating subsidiary that S&P views as core
to the parent CL Intermediate Holdings I B.V.; hence, the ratings
are linked.
"The negative outlook reflects the continued decline in
Cunningham's operating performance relative to our expectations,
resulting in significantly weakened credit protection measures,"
said Standard & Poor's credit analyst Julie Herman.
Under a new leadership team, the company has embarked on global
initiatives to mitigate the market challenges that focus on further
global diversification, increased acquisitions that may be
partially equity funded, cost cutting, and expanding its service
offerings into non-claim-dependent related services. However,
these efforts have taken longer than anticipated to develop and
translate into performance improvement, exacerbated by a
challenging market. Nevertheless, if executed successfully, S&P
believes these initiatives will enable the company to begin to show
earnings growth and de-levering in the second half of 2015 and into
2016, with leverage in the 8x-9x range by year-end 2015 and the
7x-8x range in 2016.
The negative outlook reflects Cunningham Lindsey's continued
underperformance and the execution risk in restoring performance
and leverage to a level appropriate for the current rating. Under
S&P's base-case expectations, it believes earnings have reached a
trough and it is anticipating a trend of growth in revenues and
earnings in the back half of 2015 and into 2016, resulting in
leverage of less than 8x in the next year, a funds from
operations-to-debt ratio of 5%-10%, and EBITDA coverage of more
than 2x. S&P expects growth to come from various initiatives that
have been underway by management including new recruitment, an
active M&A pipeline, and various restructuring and cost
containment. However, there is significant uncertainty involved,
particularly given the company's organic contractions, continued
tough market conditions, and recent history of underperforming
expectations.
S&P would consider downward rating movement during the next 6-12
months if S&P believes Cunningham will be unsuccessful in
stabilizing and improving the business through its operational
initiatives, resulting in leverage sustained above 8x or coverage
of less than 1.5x. S&P would also consider a downgrade if it views
the company's liquidity as less than adequate, as demonstrated by
sources not covering uses by more than 1.2x.
During the next 12 months, S&P do not expect to raise the ratings.
However, S&P could affirm the current ratings if the company can
stabilize earnings and reduce leverage to sustainably less than
8x.
CUSTOM DIESEL: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Custom Diesel Express Incorporated
111 Slate Hill Rd.
Mooresburg, TN 37811
Case No.: 15-51651
Chapter 11 Petition Date: October 30, 2015
Court: United States Bankruptcy Court
Eastern District of Tennessee (Greeneville)
Judge: Hon. Marcia Phillips Parsons
Debtor's Counsel: Barry W. Eubanks, Esq.
EUBANKS LAW FIRM, PC
209 Chilhowee School Rd., Ste. 16
Seymour, TN 37865
Tel: 865 -299-4023
Email: barry@barryeubankslaw.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by John Griffiths, Jr., CEO.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/tneb15-51651.pdf
DYNAMIC DRYWALL: Legacy Bank Can Intervene in Suit vs. McPherson
----------------------------------------------------------------
McPherson Contractors, Inc., was the general contractor on a school
renovation project for the Blue Valley School District in Johnson
County, Kansas. McPherson, as the principal, and Fidelity and
Deposit Company of Maryland, as the surety, executed a statutory
payment bond on the project.
On June 14, 2014, Dynamic Drywall, Inc., entered into a subcontract
with McPherson to provide labor and materials for the drywall and
ceiling components of the project for the contract sum of $707,510.
The subcontract provided for an April 11, 2014, project completion
date.
On May 21, 2014, DDI filed a chapter 11 petition in the United
States Bankruptcy Court for the District of Kansas and, to date,
remains a debtor-in-possession.
On September 23, 2015, Legacy Bank filed a Motion to Intervene
alleging an interest relating to property owned by DDI which was
improperly taken by defendant McPherson and is the subject matter
of the current cause of action. More specifically, Legacy asserted
that a Security Agreement was signed by plaintiff on June 27, 2012,
and again on August 30, 2013.
Judge J. Thomas Marten of the United States District Court, D.
Kansas granted the Motion to Intervene of Legacy Bank.
A full-text of the Memorandum and Order dated October 19, 2015 is
available at http://is.gd/o34FJufrom Leagle.com.
The case is captioned DYNAMIC DRYWALL, INC., Plaintiff, v.
McPHERSON CONTRACTORS, INC. and FIDELITY AND DEPOSIT COMPANY OF
MARYLAND, Defendants, CASE NO. 6:15-CV-1229-JTM.
October 19, 2015.
Dynamic Drywall, Inc., Plaintiff, represented by:
Jeffrey A. Deines, Esq.
LENTZ CLARK DEINES PA
9260 Glenwood
Overland Park, KS 66212
Phone: 913.648.0600
Fax: 913.648.0664
Email: jdeines@lcdlaw.com
--and --
Mark J. Lazzo, Esq.
MARK J. LAZZO, PA
3500 N. Rock Rd
Bldg 300, Ste B
Wichita, KS 67226
Phone: (316) 263-6895
Fax: 316) 264-4704
Defendants, represented by:
Randall J. Forbes, Esq.
FRIEDEN, UREIN & FORBES LLP
1414 SW Ashworth Place, Suite 201
Topeka, KS 66604
Phone:(785) 354-1100
Email: rforbes@fuflaw.com
About Dynamic Drywall
Dynamic Drywall Inc., based in Wichita, Kansas, filed for Chapter
11 bankruptcy (Bankr. D. Kan. Case No. 14-11131) on May 21, 2014.
Judge Robert E. Nugent presides over the case. Mark J. Lazzo,
P.A., serves as the Debtor's counsel. In its petition, Dynamic
Drywall estimated $1 million to $10 million in assets and $0 to
$50,000 in liabilities. The petition was signed by Randall G.
Salyer, president.
ELBIT IMAGING: Provides Update to Notes Buyback Programs
--------------------------------------------------------
Elbit Imaging Ltd. announced that following the Company's board of
directors' approval of a program to repurchase up to NIS 50 million
(approximately $13 million) of Elbit's Series H Notes and Series I
Notes, the Company's board of directors clarified that until
further notice, the Company will purchase only Series H Notes.
About Elbit Imaging
Tel-Aviv, Israel-based Elbit Imaging Ltd. (TASE, NASDAQ: EMITF)
holds investments in real estate and medical companies. The
Company, through its subsidiaries, also develops shopping and
entertainment centers in Central Europe and invests in and manages
hotels.
Since February 2013, Elbit has intensively endeavored to come to
an arrangement with its creditors. Elbit has said it has been
hanging by a thread for more than five months. It has encountered
cash flow difficulties and this burdens its day to day activities,
and it certainly cannot make the necessary investments to improve
its assets. In light of the arrangement proceedings, and
according to the demands of most of the bondholders, as well as an
agreement that was signed on March 19, 2013, between Elbit and the
Trustees of six out of eight series of bonds, Elbit is prohibited,
inter alia, from paying off its debts to the financial creditors
-- and as a result a petition to liquidate Elbit was filed, and
Bank Hapoalim has declared its debts immediately payable,
threatening to realize pledges that were given to the Bank on
material assets of the Company -- and Elbit undertook not to sell
material assets of the Company and not to perform any transaction
that is not during its ordinary course of business without giving
an advance notice to the trustees.
Accountant Rony Elroy has been appointed as expert for examining
the debt arrangement in the Company.
In July 2013, Elbit Imaging's controlling shareholders, Europe-
Israel MMS Ltd. and Mr. Mordechay Zisser, notified the Company
that the Tel Aviv District Court has appointed Adv. Giroa Erdinast
as a receiver with regards to the ordinary shares of the Company
held by Europe Israel securing Europe Israel's obligations under
its loan agreement with Bank Hapoalim B.M. The judgment stated
that the Receiver is not authorized to sell the Company's shares
at this stage. Following a request of Europe-Israel, the Court
also delayed any action to be taken with regards to the sale of
those shares for a period of 60 days. Europe Israel and
Mr. Zisser have also notified the Company that they utterly reject
the Bank's claims and intend to appeal the Court's ruling.
As of June 30, 2015, the Company had NIS 2.8 billion in total
assets, NIS 2.5 billion in total liabilities and NIS 338.3 million
in shareholders' equity.
EQUIPMENT ACQUISITION: 7th Cir. Affirms Horseshoe Summary Judgment
------------------------------------------------------------------
In an adversary proceeding, William Brandt, acting as plan
administrator for Equipment Acquisition Resources, seeks to avoid
and recover fraudulent transfers made to the Horseshoe Casino.
Brandt alleges that EAR made fraudulent transfers to Sheldon
Player, the original owner of EAR, and that Player used these funds
at Horseshoe. Horseshoe moved for summary judgment. The district
court granted the motion.
On appeal, Brandt argues that the district court erred in its
interpretation of Section 550(b)(1) of the Bankruptcy and that the
district court improperly denied his motion to compel production of
documents related to any investigations Horseshoe may have made
concerning Player.
The United States Court of Appeals for the Seventh Circuit affirmed
the District Court's interpretation of Section 550(b)(1) and ruled
that Brandt did not suffer prejudice from the denial of his motion
to compel.
The case is WILLIAM A. BRANDT, JR., Plaintiff-Appellant, v.
HORSESHOE HAMMOND, LLC, Defendant-Appellee, NO. 14-2174 (7th Cir.),
relating to IN RE: EQUIPMENT ACQUISITION RESOURCES, INC. Debtor.
A full-text of the Decision dated October 13, 2015, is available at
http://is.gd/gRrsHqfrom Leagle.com.
About Equipment Acquisition
Palatine, Illinois-based Equipment Acquisition Resources, Inc.,
operated in the semiconductor equipment sales and servicing
industry. It was designed to operate as a refurbisher of special
machinery, a manufacturer of high-end technology parts, and a
process developer for the manufacture of high-technology parts.
The bulk of EAR's stated revenue derived from refurbishing and
selling high-tech machinery; it was set up to purchase high-tech
equipment near the end of its useful life at prices that were low
relative to the cost of new units, and then refurbish using a
propriety process the equipment for sale to end-users at
substantial gross margins.
EaR engaged in a massive fraud from 2005 to 2009. That fraud
included, but was not limited to, selling semiconductor equipment
at inflated prices, leasing the equipment back, misrepresenting
the value of the equipment, and pledging certain pieces of
equipment multiple times to various creditors to secure
financing. It owned 2,000 pieces of semiconductor manufacturing
equipment.
First Premier Capital LLC, claiming to be owed $20 million,
alleged that the scheme has cost creditors up to $175 million.
EAR filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ill.
Case No. 09-39937) on Oct. 23, 2009. Barry A. Chatz, Esq., at
Arnstein & Lehr LLP, served as the Company's counsel. The Company
estimated $10 million to $50 million in assets and $100 million to
$500 million in liabilities in its petition. Unsecured creditors
were owed about $102 million.
ESSAR STEEL: Moody's Cut CFR to Caa3 Amid Slump in Steel Prices
---------------------------------------------------------------
On October 30, 2015, the press release was corrected as follows: in
the debt list, the LGD description of Essar Steel Algoma Inc.'s
Senior Secured Bank Credit Facility (Foreign Currency) and Senior
Secured Regular Bond/Debenture (Foreign Currency) has been changed
to B2, (LGD3). Revised release follows.
New York, October 13, 2015 -- Moody's Investors Service downgraded
Essar Steel Algoma Inc.'s (ESA) corporate family rating (CFR) and
probability of default rating to Caa3 and Caa3-PD from Caa1 and
Caa1-PD respectively. At the same time Moody's downgraded the
revolving credit facility rating to B2 from B1, the senior secured
term loan facility and senior secured notes rating to Caa1 from B2.
The rating on 1839688 Alberta ULC's secured (third/fourth lien)
notes (guaranteed by ESA and other subsidiaries of ESA) was
downgraded to Ca from Caa2. The outlook is negative.
ESA is owned by Essar Steel Holdings LTD and is part of the Essar
Global Group based in India.
The downgrade reflects the expected impact on ESA's performance
from the severe drop in steel prices that has dominated the steel
industry in 2015, and which in conjunction with ongoing cost
pressures, despite cost benefits from the weaker Canadian Dollar,
is contributing to ongoing operating losses at ESA. With hot-rolled
prices averaging about US$ 472/ton through September 2015 and
currently in the US$ 415/ton range, the company has negative
operating profits, which will widen in the second quarter ended
September 30, 2015 from the C$28.9 million operating loss in the
first quarter ended March 31, 2015 and EBITDA (C$ 5.6 million in
the first quarter) could turn negative for the quarter. The
downgrade also considers the weak liquidity position of the company
and lack of alternative sources absent further funds from its
parent, given the likely continued cash burn on the loss making
operations and the upcoming November 15, 2015 interest payment
(USD17.8 million) on the 9.5% senior secured notes.
Downgrades:
Issuer: Essar Steel Algoma Inc.
Corporate Family Rating, Downgraded to Caa3 from Caa1
Probability of Default Rating, Downgraded to Caa3-PD from Caa1-PD
Senior Secured Bank Credit Facility (Foreign Currency), Downgraded
to B2 (LGD1) from B1 (LGD1)
Senior Secured Bank Credit Facility (Foreign Currency), Downgraded
to Caa1 (LGD2) from B2 (LGD3)
Senior Secured Regular Bond/Debenture (Foreign Currency),
Downgraded to Caa1 (LGD2) from B2 (LGD3)
Issuer: Essar Steel Algoma Inc.
Outlook, Changed To Negative From Stable
Downgrades:
Issuer: 1839688 Alberta ULC
Backed Senior Secured 3rd Lien Bond/Debenture (Foreign Currency),
Downgraded to Ca (LGD4) from Caa2 (LGD4)
Outlook Actions:
Issuer: 1839688 Alberta ULC
Outlook, Changed To Negative From Stable
RATINGS RATIONALE
The Caa3 CFR reflects the company's weak debt protection metrics,
the headwinds facing the steel industry as reflected by weak
capacity utilization rates, high import levels, the collapse of the
OCTG market as a result of the drop in oil prices and the collapse
in steel prices. There is no meaningful catalyst seen for the
degree of improvement necessary to materially change ESA's
operating performance. ESA completed a recapitalization and
refinancing of its debt in late 2014. Nevertheless, the company
remained highly leveraged as of December 2014, with an LTM adjusted
leverage ratio (debt/EBITDA) of more than 10x. ESA's interest
coverage ratio (EBIT/Interest Expense) was also very weak, with its
EBIT not fully covering its interest expense. Given the steep fall
in steel prices to date in 2015, these metrics are likely to have
deteriorated further. ESA no longer provides public financial
statements.
In November 2014 ESA completed a refinancing and recapitalization
transaction through a plan of arrangement under the Canada Business
Corporations Act. The recapitalization included ESA's ultimate
parent, Essar Global Fund Limited and its affiliates providing
roughly $400 million in support through a combination of an equity
infusion, the conversion of existing obligations into preferred
stock and the purchase of ESA's Port of Algoma. There is no
expectation of parental support incorporated in the rating.
The Caa3 CFR also considers the business and operating issues
facing the company in its ongoing dispute with Cliffs Natural
Resources concerning the Pellet Sale and Purchase Agreement. Cliffs
recently announced that it has terminated the Agreement and ESA has
filed for a Temporary Restraining Order. This presents further
challenges beyond running the blast furnace as this time frame
represents the seasonal need to build inventory levels in advance
of winter weather on the Great Lakes. The CFR also captures the
single site location and modest scale (2.5 million tons
approximately) and limited customer base.
Under Moody's loss given default methodology, the B2 rating on the
ABL revolver reflects its superior position in the capital
structure and the expectation of significant recovery given the
first priority claim on receivables and inventory among other
current assets. The Caa1 rating on both the term loan and senior
secured notes, which are secured principally by plant, property and
equipment and other non- current assets and have a second lien on
the collateral securing the ABL revolver, reflects the weaker
position of these instruments in the debt waterfall. The ABL
facility has a second lien on the collateral securing the term loan
and the senior secured notes. The Ca rating on the secured
(third/fourth lien) notes reflects the subordination of these
instruments to a considerable amount of other secured debt and the
expectation of a considerable loss in value in a default scenario.
The ABL revolver, term loan and secured notes benefit from the loss
absorption capacity of ESA's secured (third/forth lien) debt, as
well as pension obligations and accounts payable.
The negative outlook reflects our expectation that industry
conditions will not materially improve over the next several months
and that ESA will continue to face liquidity pressures
Given the single site location and weak steel industry
fundamentals, upward rating movement is unlikely over the next
twelve to eighteen months. Downward rating pressure would arise
should liquidity worsen.
The principal methodology used in these ratings was Global Steel
Industry published in October 2012. Please see the Credit Policy
page on www.moodys.com for a copy of this methodology.
Headquartered in Sault Ste. Marie, Ontario, Canada, ESA is an
integrated steel producer. Approximately 80% to 85% of ESA's sales
are sheet products with plate products accounting for the balance.
For the 12 months ending December 31, 2014, ESA generated revenues
of C$1.9 billion.
FIRST DATA: EJF Capital Owns 5.1% of Class A Shares as of Oct. 23
-----------------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, EJF Capital LLC disclosed that as of Oct. 23, 2015, it
beneficially owns 9,488,659 shares of Class A common stock, par
value $0.01 per share, of First Data Corporation, representing 5.1
percent of the shares outstanding.
The Schedule 13G was jointly filed by Emanuel J. Friedman; EJF Debt
Opportunities Master Fund, L.P.; EJF Debt Opportunities GP, LLC;
EJF Debt Opportunities Master Fund II, LP; EJF Debt Opportunities
II GP, LLC; Beltway Strategic Opportunities Fund L.P.; and EJF
Beltway Strategic Opportunities GP LLC.
A copy of the regulatory filing is available for free at:
http://is.gd/UUaWuP
About First Data
Based in Atlanta, Georgia, First Data Corporation provides
commerce and payment solutions for financial institutions,
merchants, and other organizations worldwide.
First Data reported a net loss attributable to the Corporation of
$458 million on $11.2 billion of total revenues for the year ended
Dec. 31, 2014, compared with a net loss attributable to the
Corporation of $869 million on $10.8 billion of total revenues
during the prior year.
As of Sept. 30, 2015, the Company had $33.44 billion in total
assets, $31.37 billion in total liabilities and $1.98 billion in
total equity.
* * *
The Company carries a 'B3' corporate family rating, with a
stable outlook, from Moody's Investors Service, a 'B' corporate
credit rating, with stable outlook, from Standard & Poor's, and
a 'B' long-term issuer default rating from Fitch Ratings.
FIRST DATA: Fitch Assigns CCC+ Rating on $750MM Sr. Unsec. Notes
----------------------------------------------------------------
Fitch Ratings has assigned a 'CCC+/RR6' rating to First Data
Corp.'s (FDC) $750 million senior unsecured notes due 2023. Fitch
rates FDC with an Issuer Default Rating of 'B' with a Positive
Outlook. At Sept. 30, 2015, the company had $21 billion in total
debt outstanding.
Proceeds are expected to be used to redeem and/or repurchase $750
million aggregate principal amount of the 12.625% senior unsecured
notes due 2021, and to use a part of its recent initial public
offering (IPO) proceeds to pay related premiums, fees and
expenses.
KEY RATING DRIVERS
-- The Positive Outlook reflects First Data's completion of an
IPO on Oct. 15, and expectations that net proceeds of approximately
$2.8 billion will be used to reduce debt. Using the IPO proceeds,
First Data plans to redeem all $510 million of its 11.25% senior
unsecured notes due 2021 and $1.8 billion of the 12.625% senior
unsecured notes due 2021.
-- Improved Credit Profile: Pro forma for the post-IPO debt
reduction, Fitch estimates total leverage was 7.1x at Sept. 30,
2015, and that leverage could be under 6x at the end of 2017. As
previously disclosed, Fitch believes expectations for leverage
under 6x would likely lead to an upgrade. Fitch expects free cash
flow (FCF) to improve materially following the debt reduction and
through debt refinancings in 2015 and potential future
refinancings.
-- Leveraged Capital Structure: The current rating reflects
FDC's highly leveraged capital structure. As of Sept. 30, 2015,
total and secured leverage were 7.9x and 5.8x, respectively. Fitch
notes that leverage has materially declined from 10.6x in 2010 as a
result of debt reduction and EBITDA growth.
-- Large Operational Scale: The Global Business Solutions
business is characterized by its large scale and global footprint
with more than six million merchants. Existing merchant
relationships and large distribution platform (alliances and
partnerships) reinforce the company's ability to sustain its market
share while providing a pathway to introduce and capitalize on
emerging technologies (i.e. Apple Pay, Clover, EMV, and Mobile
Payments). The Global Financial Solutions business also benefits
from this scale and established relationships with card issuers as
well as from long-term contracts which have high switching costs.
-- Diversified Customer Base: The customer base is global in
nature and consists primarily of millions of regional and local
merchants and large financial institutions. Fitch notes, however,
that FDC is exposed to price-sensitive merchants within small- and
medium-sized businesses that are more susceptible to down cycles.
-- Fee Structure Offsets Cyclicality: Revenue has a correlation
with consumer spending, but volatility is subdued due to the
continued adoption of electronic payments, exposure to consumer
staples, pricing model (paid per transaction as well as on a
percentage of transacted amount) in Global Business Solutions, and
contractual nature of fees (based on activity level) in Global-
Financial Solutions.
-- Spending Shift: A mix shift in consumer spending patterns
favoring large discount retailers that have more leverage to
negotiate favorable fees has pressured profitability and revenue
growth. Fitch notes that this is mitigated by increased spending
online that can generate high fees due to the higher risk
associated with the transaction.
-- Financial Industry Consolidation: Consolidation could pose a
risk for the company, particularly in FDC's Global Financial
Solutions segment, as could changes in regulations in First Data's
overall business.
-- Emerging Competition: The high barriers to entry could be
eroded by the emergence of new payment technology in the Global
Business Solutions segment. Conversely, the Global Financial
Solutions segment has much lower exposure to emerging competitors
due to First Data's strong position in card processing for large
institutions.
KEY ASSUMPTIONS
-- Fitch assumes revenues will grow in the low- to mid-single
digits over the near term, and that First Data's EBITDA margin will
be relatively stable in the 24% to 25% range. Fitch's assumptions
for the EBITDA margin are based on gross revenues, which include
material reimbursable expenses.
-- Fitch believes that through EBITDA growth and debt reduction
First Data's consolidated leverage will decline to approximately
5.9x by the end of 2017.
RATING SENSITIVITIES
Positive Trigger: The ratings could be upgraded if First Data's
credit profile continues to strengthen, and leverage is expected to
be maintained at or below 6x (gross leverage). Future developments
that may lead to positive rating action include sustained EBITDA
growth and reductions in debt from the company's improved free cash
flow position.
Negative Trigger: The ratings could be downgraded if First Data
were to experience erosion in its market share or if price
compression accelerates due to new competitive threats leading to
sustained EBITDA margins at approximately 20% or below with
negative free cash flow generation.
LIQUIDITY AND DEBT STRUCTURE
Liquidity as of June 30, 2015 (First Data's most recent Form 10-Q
filing) consisted of $348 million in cash (net $92 million in
amounts held outside the U.S. and at subsidiaries to fund their
respective operations). First Data also has a $1.25 billion
revolving credit facility (RCF) that expires in June 2020 (subject
to an earlier springing maturity if certain debt remains
outstanding at certain dates). As of June 30, 2015, First Data's
RCF provided an additional approximately $1 billion of liquidity
(net of $204 million drawn and $41 million in letters of credit
outstanding).
FIRST DATA: Prices $3.4-Bil. of 7% Senior Notes due 2023
--------------------------------------------------------
First Data Corporation disclosed that it has priced an offering of
$3.4 billion aggregate principal amount of 7.000% senior notes due
2023, an increase from the previously announced offering of
$750 million senior notes. The offering is expected to close on
Nov. 18, 2015, subject to customary closing conditions.
First Data intends to use the proceeds from the offering of the
Notes, together with proceeds from its initial public offering and
borrowings under its senior secured revolving credit facility, to
redeem (i) all $1,404 million aggregate principal amount of its
12.625% senior unsecured notes due 2021 that will be outstanding
after giving effect to the redemption of $1,596 million aggregate
principal amount of the 12.625% Notes pursuant to a notice issued
by the Company on Oct. 16, 2015, (ii) all $530 million outstanding
aggregate principal amount of its 10.625% senior unsecured notes
due 2021 and (iii) all $1,609 million outstanding aggregate
principal amount of its 11.75% senior subordinated notes due 2021,
and to pay any applicable premiums and related fees and expenses.
The refinancing is expected to result in an additional reduction of
annualized interest expense of $160 million over and above interest
savings resulting from the initial public offering proceeds.
The Notes have not been registered under the Securities Act of
1933, as amended, and, unless so registered, may not be offered or
sold in the United States absent registration or an applicable
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and other
applicable securities laws.
About First Data
Based in Atlanta, Georgia, First Data Corporation provides
commerce and payment solutions for financial institutions,
merchants, and other organizations worldwide.
First Data reported a net loss attributable to the Corporation of
$458 million on $11.2 billion of total revenues for the year ended
Dec. 31, 2014, compared with a net loss attributable to the
Corporation of $869 million on $10.8 billion of total revenues
during the prior year.
As of Sept. 30, 2015, the Company had $33.44 billion in total
assets, $31.37 billion in total liabilities and $1.98 billion in
total equity.
* * *
The Company carries a 'B3' corporate family rating, with a
stable outlook, from Moody's Investors Service, a 'B' corporate
credit rating, with stable outlook, from Standard & Poor's, and
a 'B' long-term issuer default rating from Fitch Ratings.
FLATLANDS INVESTOR: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Flatlands Investor Acquisition LLC
5417-18th Avenue
Brooklyn, NY 11204
Case No.: 15-12953
Chapter 11 Petition Date: November 2, 2015
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Debtor's Counsel: Arnold Mitchell Greene, Esq.
ROBINSON BROG LEINWAND GREENE
GENOVESE & GLUCK, P.C.
875 Third Avenue, 9th Floor
New York, NY 10022
Tel: (212) 603-6300
Fax: (212) 956-2164
Email: amg@robinsonbrog.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by David Kornitzer, member.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
FREEDOM COMMUNICATIONS: Case Summary & 20 Top Unsecured Creditors
-----------------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Freedom Communications, Inc. 15-15311
a Delaware Corporation
aka The Orange County Register
fka Freedom Newspapers, Inc.
729 N. Grand Avenue
Santa Ana, CA 92701
Freedom Communications Holdings, Inc. 15-15312
a Delaware Corporation
aka The Press Enterprise
fka Viapointe, Inc.
fka Freedom Webmaster, Inc.
729 N. Grand Avenue
Santa Ana, CA 92701
Freedom Services, Inc. 15-15313
a Delaware corporation
2100 Freedom, Inc. 15-15315
a Delaware corporation
OCR Community Publications, Inc. 15-15316
a California corporation
Daily Press, LLC 15-15317
a California limited liability company
Freedom California Mary Publishing, Inc. 15-15318
a California corporation
Freedom California Ville Publishing Company LP 15-15319
a California limited partnership
Freedom Colorado Information, Inc. 15-15320
a Delaware corporation
Freedom Interactive Newspapers, Inc. 15-15321
a California corporation
Freedom Interactive Newspapers of Texas, Inc. 15-15322
a Delaware corporation
Freedom Newspapers Acquisitions, Inc. 15-15323
a Delaware corporation
Freedom Newspapers, 15-15324
a Texas general partnership
Freedom Newspapers, Inc. 15-15325
a Delaware corporation
Freedom Newspapers of Southwestern Arizona, Inc. 15-15326
a California corporation
OCR Information Marketing, Inc. 15-15327
a California corporation
Odessa American 15-15328
a Texas general partnership
Orange County Register Communications, Inc. 15-15329
a California corporation
Victor Valley Publishing Company 15-15330
a California corporation
Victorville Publishing Company 15-15332
a California limited partnership
Freedom SPV II, LLC
a Delaware limited liability company
Freedom SPV VI, LLC
a Delaware liminated liability company
Freedom SPV I, LLC
a Delaware limited liability company
Freedom SPV IV, LLC
a Delaware limited liability company
Freedom SPV V, LLC
a Delaware limited liability company
Type of Business: Media Company
Chapter 11 Petition Date: November 1, 2015
Court: United States Bankruptcy Court
Central District of California (Santa Ana)
Debtors' Counsel: William N Lobel, Esq.
Alan J. Friedman, Esq.
Beth E. Gaschen, Esq.
Christopher J. Green, Esq.
LOBEL WEILAND GOLDEN FRIEDMAN LLP
650 Town Center Drive, Suite 950
Costa Mesa, CA 92686
Tel: 714-966-1000
Fax: 714-966-1002
Email: wlobel@lwgfllp.com
afriedman@lwgfllp.com
bgaschen@lwgfllp.com
cgreen@lwgfllp.com
Estimated Assets: $10 million to $50 million
Estimated Debts: $10 million to $50 million
The petition was signed by Richard E. Mirman, chief executive
officer.
List of Freedom Communications Holdings' 20 Largest Unsecured
Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
American Express Credit Card $1,938,296
Corporate Lakes Blvd
2975 W Corporate Lakes Blvd
Weston, FL 33331-3626
Latham & Watkins LLP Legal Services $1,501,442
200 Clarendon Street
27th Floor
Boston, MA 02116
Ponderay Newspaper Co. Services $1,038,726
dba Resolute
PO Box 515070
Los Angeles, CA 90051-5070
Central National Gottesman Inc. Services $728,954
PO Box 100431
Atlanta, GA 30384-0431
Newscycle Solutions Inc. Services $719,302
Dept CH 19691
Palatine, IL 60055-9691
Electronic Business Solutions Services $611,999
& Consulting
19800 MacArthur Blvd
Suite 300
Irvine, CA 92612
Associated Press Services $571,740
PO Box 414212
Boston, MA 02241-4212
CCI Europe, Inc. Services $396,698
600 Townpark Lane NW,
Suite 350
Kennesaw, GA 30144
Press One Customer Care Inc. Services $394,596
123 N College Avenue Suite 120
Ft. Collins, CO 80524
Southern Lithoplate Inc. Services $357,746
PO Box 741887
Atlanta, GA 30374-1887
Central Ink Corp. Services $327,342
Dept 20-7019
PO Box 5997
Carol Stream, IL 60197-5997
Happiest Minds Technologies Private Services $314,564
Velankani Tech Park 43
Electronics City Hosur Road
Bangalore, India 560 100
Kaiser Foundation Health Plan Insurance $314,204
PO Box 80204
Worldway Postal Center
Los Angeles, CA 90080
Gabriels Technology Solutions Services $304,250
9 E40th Street 2nd Floor
New York, NY 10016
Infosys BPO Limited Services $293,005
Bank of America Lockbox Services
13539 Collections Center
Drive
Chicago, IL 60693
Levine Lee LP Services $232,115
Marvin F Poer & Company Services $221,523
FTI Consulting Inc. Services $162,968
Simplifi Holdings, Inc. Services $158,705
Petroleum Building LLC Services $153,357
FREEDOM COMMUNICATIONS: Files for Chapter 11 to Sell Assets
-----------------------------------------------------------
Freedom Communications, Inc. and 24 of its affiliates sought
Chapter 11 bankruptcy protection in California with the intention
of selling their assets to a group of local investors led by Rich
Mirman, Freedom's chief executive officer and publisher.
Headquartered in Santa Ana, California, Freedom owns two daily
newspapers -- The Press-Enterprise in Riverside, Calif. and The
Orange County Register in Santa Ana, Calif.
In a letter to employees, Mr. Mirman said he expects the filing to
have minimal impact on the day-to-day operations of the Debtors'
business. Freedom will continue to fund daily operations,
including payroll and health benefits, as well as post-petition
vendor and partner invoices, he added.
Mr. Mirman assured advertisers and subscribers that the filing will
have no impact to them as the Company's two daily newspapers,
weeklies, and magazines will continue to operate.
According to Mr. Mirman, despite recent success, the Company is
struggling to cover its financial obligations and is overloaded
with debt. He said the Company incurred accumulated financial
losses in 2013 and 2014 under the previous leadership.
One of the primary investors participating in the bid is Mike
Harrah, owner of Santa Ana-based development and real estate firm
Caribou Industries.
In accordance with requirements of Section 363 of the Bankruptcy
Code, Messrs. Mirman and Harrah will submit a "stalking horse" bid
to purchase the assets of the company that includes a cash
component, assumption of liabilities and the retention of the
employee pension program.
"I am confident our bid will be successful, and the company will
emerge with a solid financial foundation and well-positioned for
future success. The goal is to strengthen our position as the
leader in providing local news and information for Orange,
Riverside and San Bernardino counties," Mr. Mirman said.
The bidding process is expected to be completed in 60 to 90 days.
Freedom Communications, Inc., et al., filed Chapter 11 bankruptcy
petitions (Bankr. C.D. Cal. Proposed Lead Case No. 15-15311) on
Nov. 1, 2015. Richard E. Mirman signed the petition as chief
executive officer. Lobel Weiland Golden Friedman LLP serves as the
Debtors' counsel.
Freedom Communications Holdings estimated both assets and
liabilities in the range of $10 million to $50 million.
GLOBAL TELLINK: S&P Affirms 'B' CCR & Removes from Watch Neg.
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it has affirmed all
ratings, including its 'B' corporate credit rating, on Mobile,
Ala.-based inmate telecommunications provider Global Tel*Link Corp.
S&P removed all ratings from CreditWatch where it placed them with
negative implications on Oct. 8, 2015. The outlook is negative.
"The affirmation and negative outlook reflects our uncertainty
regarding the company's operating performance over the next few
years," said Standard & Poor's credit analyst Rose Askinazi.
The risks S&P identified in its research update published Oct. 8,
2015, when S&P placed the company's ratings on CreditWatch remain,
including the FCC's vote to cap rates for inmate calling services,
without reducing or eliminating facility commission payments.
"We believe the forthcoming FCC order, if implemented, could
materially hurt the company's profitability and push leverage above
our 6.5x downgrade threshold on a sustained basis," said Ms.
Askinazi.
The negative outlook reflects S&P's uncertainty regarding the
company's operating performance over the next few years. This
stems from the FCC's vote to cap rates on inmate calling services,
without reducing or eliminating facility commission payments. S&P
believes the forthcoming FCC order, if implemented, could
materially hurt the company's profitability and push leverage above
S&P's 6.5x downgrade threshold on a sustained basis.
S&P could lower the rating if it believes the company is not on a
credible path to materially offset the negative impact of the rate
caps over the next 12 months, pushing leverage above 6.5x on a
sustained basis. More specifically, if S&P believes the company
has not made material progress in renegotiating its contracts to
reduce existing commission payments and growing its ancillary
service offerings over the next 12 months, S&P could lower
ratings.
S&P could revise the outlook to stable if it believes the company
has a credible plan to materially offset the negative impact of the
rate caps, likely through the aforementioned actions. More
specifically, S&P could revise the outlook to stable if it believes
the company can sustain leverage below 6.5x over the next 12 months
while maintaining "adequate" liquidity.
GT ADVANCED: Motion to Approve KEIP, KERP Denied
------------------------------------------------
Judge Henry J. Boroff of the United States Bankruptcy Court for the
District of New Hampshire denied GT Advanced Technologies, Inc., et
al.'s motion to approve their proposed key employee incentive plan
and key employee retention plan, holding that the KEIP is primarily
designed to be retentive, and not as incentive in nature, and the
KERP, as currently formulated, is not justified under the facts and
circumstances of this case.
The case is captioned In re: GT ADVANCED TECHNOLOGIES, INC., et
al., Debtors. CASE NO. 14-11916-HJB JOINTLY ADMINISTERED (Bankr.
D.N.H.).
A full-text of the Memorandum dated September 30, 2015 is available
at http://is.gd/9YTZlmfrom Leagle.com.
GT Advanced Technologies, Inc., Debtor, represented by:
Holly Barcroft, Esq.
NIXON PEABODY LLP
Phone: 603-628-4085
Fax: 866-491-3034
Email: hbarcroft@nixonpeabody.com
Ocwen Loan Servicing, LLC d/b/a City National Bank, Defendant,
represented by:
Charles Higgs, Esq.
MCCABE, WEISBERG & CONWAY
123 S. Broad Street Suite 2080
Philadelphia , Pennsylvania 19109
United States
Phone: 215 790 1010
Fax: 215 790 1274
About GT Advanced
Headquartered in Merrimack, New Hampshire, GT Advanced
Technologies Inc. -- http://www.gtat.com/-- produces materials and
equipment for the electronics industry. On Nov. 4, 2013, GTAT
announced a multiyear supply deal with Apple Inc. to produce
sapphire glass material for use in consumer electronics products.
Under the deal, Apple would provide GTAT with a prepayment of
approximately $578 million paid in four installments and, starting
in 2015, GTAT would reimburse Apple for the prepayment over a
five-year period.
GT is a publicly held corporation whose stock was traded on NASDAQ
under the ticker symbol "GTAT." GTAT was de-listed from the
NASDAQ stock exchange in October 2014.
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 eight affiliates
filed voluntary petitions for relief under Chapter 11 of the
United States Bankruptcy Code (Bankr. D.N.H. Lead Case No.
4-11916). GT says that it has sought bankruptcy protection due to
a severe liquidity crisis brought about by its issues with Apple.
The Debtors have tapped Nixon Peabody LLP and Paul Hastings LLP as
attorneys and Kurtzman Carson Consultants LLC as claims and
noticing agent.
The U.S. Trustee has named seven members to the Official Committee
of Unsecured Creditors. The Committee' professionals are Kelley
Drye as its bankruptcy counsel; Devine, Millimet & Branch,
Professional Association as local counsel; EisnerAmper LLP as
financial advisors; and Houlihan Lokey Capital, Inc. as investment
banker.
GTAT has reached a settlement with Apple. The settlement gives
Apple an approved claim for $439 million secured by more than
2,000 sapphire furnaces that GT Advanced owns and has four years
to sell, with proceeds going to Apple. In addition, Apple gets
royalty-free, non-exclusive licenses for GTAT's technology.
The bankruptcy case is assigned to Judge Henry J. Boroff.
GULF PACKAGING: Creditors Committee Balks at ASK Employment
-----------------------------------------------------------
The Official Committee of Unsecured Creditors in the Chapter 11
cases of Gulf Packaging, Inc., filed a limited objection to the
Debtor's motion to employ ASK LLP as special preference counsel.
On Sept. 4, 2015, the Committee filed a motion to convert the
Chapter 11 to a Chapter 7 proceeding, because, among other things,
the case is administratively insolvent, the longer the case remains
in Chapter 11, the more the estate will be diminished, the Debtor
has no ongoing business and the parties have not reached an
agreement on a plan of liquidation.
According to the Committee, conversion of the case to Chapter 7 is
inevitable. If ASK LLP is employed by the Debtor on a contingency
basis now, weeks before conversion, it will make the splitting of
fees unnecessarily complicated if the Chapter 7 trustee chooses to
retain a different law firm.
The Committee noted that there is no reason why the Debtor cannot
wait a few weeks to employ counsel to pursue preference actions,
until the conversion motion is heard.
The Debtor, on Aug. 27, requested for permission to employ ASK as
special preference counsel effective as of Aug. 10, 2015, the date
the retention agreement was signed.
ASK will, among other things;
a) complete preference analysis;
b) attempt to recover claims via settlement agreements before
filing adversary proceedings;
c) assist the Debtor in determining which adversary proceedings
should must be filed and prosecute such adversary proceedings; and
d) remit to GPI monies received on a monthly basis, net of fees
and expenses advanced by, and owing to, ASK.
The Debtor proposed that ASK's compensation be: 15% of amounts
collected prior to lawsuit; 25% of amounts collected post-lawsuit;
and 30% on amounts collected post-judgment.
The Committee is represented by:
Richard S. Lauter, Esq.
Shelly A. DeRousse, Esq.
Devon J. Eggert, Esq.
Elizabeth L. Janczak
FREEBORN & PETERS LLP
311 South Wacker Drive, Suite 3000
Chicago, IL 60606-6677
Tel: (312) 360-6000
Fax: (312) 360-6520
About Gulf Packaging
Formed as a Texas corporation in February 2012, Gulf Packaging
Inc. is a distributor of packaging equipment and supplies, which
sells its product by and through several independent entities.
GPI
is a private company, with its equity held in equal parts by the
Fleck Family Partnership, LLC and CWJ Eagle, LLC (which is
affiliated with the Cutshall family).
Gulf Packaging sought Chapter 11 protection (Bankr. N.D. Ill. Case
No. 15-15249) on April 29, 2015. The Debtor disclosed
$16.4 million in assets and $29.8 million in liabilities as of the
Chapter 11 filing.
The case is assigned to Judge Pamela S. Hollis. The Debtor tapped
FrankGecker LLP as counsel; BMC Group Inc. as claims and noticing
agent; and the firm of Gavin/Solmonese to provide Edward T. Gavin
as chief restructuring officer.
The U.S. Trustee appointed nine creditors to serve on an official
committee of unsecured creditors.
HAIMARK LINE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Haimark Line, Ltd.
1536 Cole Blvd, Suite 330
Lakewood, CO 80401
Case No.: 15-22180
Chapter 11 Petition Date: October 30, 2015
Court: United States Bankruptcy Court
District of Colorado (Denver)
Judge: Hon. Sidney B. Brooks
Debtor's Counsel: Jeffrey S. Brinen, Esq.
KUTNER BRINEN GARBER, P.C.
1660 Lincoln St., Ste. 1850
Denver, CO 80264
Tel: 303-832-2400
Email: jsb@kutnerlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Marcus Leskovar, managing partner.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/cob15-22180.pdf
HELLER EHRMAN: Order Allowing Former Worker's $1.1MM Claim Affirmed
-------------------------------------------------------------------
Heller Ehrman LLP appeals the Bankruptcy Court's Order allowing K.
William Neuman's Claim 719, which asserts that Heller Ehrman owes
Neuman $1,161,066 under an employment contract that Neuman entered
into with the LLP.
The Bankruptcy Court concluded that (1) Neuman was not a
shareholder at the time of the firm's dissolution, so he had a
right to compensation as an employee, (2) the firm's dissolution
did not prevent Neuman from satisfying his obligations under the
contract, and (3) the claims arising from Neuman's employment
contract with the LLP were not subordinated in the LLP's Plans of
Dissolution and Liquidation.
Neuman joined the LLP as an associate in 1976, became a shareholder
in the 1980s, served as the head of the firm's Real Estate Practice
Group, and eventually became the firm's Vice President — Real
Estate Operations. In addition to maintaining his practice, he
secured new leases and supervised construction to accommodate the
firm's international growth. Eventually, Neuman had to devote so
much time to the firm's internal real estate needs that his
billable hours dropped; he was also diagnosed with cancer and
required treatment around 2001, although he continued to work
during and after his illness.
In early 2007, a member of the firm's Compensation Committee
approached Neuman to propose that he move from variable,
profit-sharing compensation to fixed-income compensation governed
by a four year employment contract. After some negotiation over
terms, Neuman and the firm agreed that he would move to a
fixed-income contract. The contract expressly stated that it was an
agreement between Neuman and Heller Ehrman LLP, not one of the
firm's regional PCs, and it was signed by the LLP's managing
shareholder—Robert Hubbell—rather than by an officer of a
regional PC.
Judge Charles R. Breyer of the United States District Court for the
Northern District of California affirmed the decision of the
Bankruptcy Court.
A full-text of the Order dated September 30, 2015 is available at
http://is.gd/HBljrdfrom Leagle.com.
The case is captioned Heller Ehrman LLP, Appellant, v. K. William
Neuman, Appellee, NO. C 14-4002 CRB.
Heller Ehrman LLP, Appellant, represented by Christopher Daniel
Sullivan, Esq. -- csullivan@diamondmccarthy.com -- Diamond McCarthy
LLP, Ellen Ruth Fenichel, Esq. -- efenichel@vallemakoff.com --
Valle Makoff LLP, Gail S. Greenwood, Esq. -- ggreenwood@pszjlaw.com
-- Pachulski Stang Ziehl & Jones LLP, Henry I. Bornstein, Esq. --
hib-lh-sf@sbcglobal.net -- Lovitt & Hannan, Inc., Ivan Lerer
Kallick, Esq. -- ikallick@manatt.com -- Manatt Phelps et al LLP, J.
Thomas Hannan, thannan@bzbm.com -- Lovitt & Hannan, Inc., Jason
Edward Rios, Esq. -- jrios@ffwplaw.com -- Felderstein Fitzgerald,
Joel Dennis Adler, -- Esq. -- jadler@adlerlaw.net -- Adler Law
Firm, John D. Fiero, Esq. -- jfiero@pszjlaw.com -- Pachulski Stang
Ziehl Young Jones & Weintraub LLP, Jonathan W. Hughes, Esq. --
Jonathan.Hughes@aporter.com -- Arnold & Porter LLP, Mario R
Nicholas, Esq. -- mnicholas@lawssl.com -- Stewart, Sokol & Larkin
LLC, Marjorie E. Manning, Esq. -- mem@bwg-inc.com -- Bolling,Walter
& Gawthrop, Matthew Sendaula Sepuya, Esq. --
msepuya@diamondmccarthy.com -- Diamond McCarthy LLP, Pamela
Phillips, Pamela.Phillips@aporter.com -- Arnold & Porter LLP, Teddy
Manish Kapur, Esq. -- tkapur@pszjlaw.com -- Pachulski Stang Ziehl
and Jones LLC, Thomas Andrew Willoughby, Esq. --
twilloughby@ffwplaw.com -- Felderstein, Fitzgerald, Willoughby
Pascuzzi LLP & William James Lafferty, Howard Rice Nemerovski
Canady Falk.
K. William Neuman, Appellee, represented by:
Michael St. James, Esq.
St. James Recovery Services, P.C.
155 Montgomery St 1004
San Francisco, CA 94104
About Heller Ehrman
Headquartered in San Francisco, California, Heller Ehrman, LLP
-- http://www.hewm.com/-- was an international law firm of more
than 730 attorneys in 15 offices in the United States, Europe, and
Asia. Heller Ehrman filed a voluntary Chapter 11 petition (Bankr.
N.D. Cal., Case No. 08-32514) on Dec. 28, 2008. Members of the
firm's dissolution committee led by Peter J. Benvenutti approved a
plan dated Sept. 26, 2008, to dissolve the firm. The Hon. Dennis
Montali presides over the case. Pachulski Stang Ziehl & Jones LLP
assisted the Debtor in its restructuring effort. The Official
Committee of Unsecured Creditors is represented by Felderstein
Fitzgerald Willoughby & Pascuzzi LLP. The firm estimated assets
and debts at $50 million to $100 million as of the Petition Date.
According to reports, the firm had roughly $63 million in assets
and 54 employees at the time of its filing. On Aug. 13, 2010, the
Court confirmed Heller's Joint Plan of Liquidation.
HUTCHESON MEDICAL: Maybrook Healthcare Offers $7.2M for Parkside
----------------------------------------------------------------
Maybrook Healthcare LLC has offered to acquire Hutcheson Medical
Center, Inc.'s nursing home Parkside Nursing Home for $7.2 million,
court documents say.
Tyler Jett at Timesfreepress.com relates that the sale faced
opposition from attorneys for Erlanger Health System, which gave
Hutcheson Medical a $20 million line of credit in 2011 and believes
it has the right to foreclose on the nursing home, and Catoosa
County Attorney Clifton "Skip" Patty.
Erlanger Health's lawyers, Timesfreepress.com reports, contended
that Hutcheson Medical does not have the right to sell the nursing
home.
Timesfreepress.com adds that Mr. Patty claimed that Hutcheson
Medical owes Erlanger Health about $32 million, including interest.
Parkside Nursing Home will remain open, Timesfreepress.com reports.
About Hutcheson Medical Center
Hutcheson Medical Center, Inc., operates the 179-bed hospital and
related ancillary facilities, including, without limitation, a
skilled nursing home and an ambulatory surgery center, located in
Ft. Oglethorpe, Georgia, known as Hutcheson Medical Center. HMC
leases the land and buildings that comprise the Medical Center from
The Hospital Authority of Walker, Dade and Catoosa Counties.
HMC and Hutcheson Medical Division, Inc., sought Chapter 11
bankruptcy protection (Bankr. N.D. Ga. Case No. 14-42863 and
14-42864) in Rome, Georgia, on Nov. 20, 2014. The cases are
jointly administered under Case No. 14-42863.
The cases have been assigned to the Honorable Paul W. Bonapfel.
The Debtors are represented by Ashley Reynolds Ray, Esq., and J.
Robert Williamson, Esq., at Scroggins and Williamson, in Atlanta,
Georgia.
The Debtors' Chapter 11 Plan and Disclosure Statement are due March
20, 2015.
HMC disclosed $32.8 million in assets and $52.9 million in
liabilities as of the Chapter 11 filing.
No request has been made for the appointment of a trustee or
examiner.
INTELSAT SA: Reports Third Quarter 2015 Results
-----------------------------------------------
Intelsat S.A. reported net income attributable to common
shareholders of $77.98 million on $581 million of revenue for the
three months ended Sept. 30, 2015, compared to net income
attributable to common shareholders of $67.6 million on $609
million of revenue for the same period during the prior year.
As of Sept. 30, 2015, the Company had $16.6 billion in total
assets, $17.2 billion in total liabilities, a $562 million total
shareholders' deficit and $29.9 million in non-controlling
interest.
Intelsat CEO, Stephen Spengler, said, "Intelsat continues to make
meaningful progress as we position the company for long term
growth, leveraging our new high throughput capacity and introducing
new services to address the $3.0 billion of incremental demand for
satellite solutions expected over the next five years. The first
launch of our next generation fleet is just months away. Since
July 1, 2015 Intelsat has signed six additional contracts on the
Intelsat EpicNG platform. These contracts span applications
including enterprise, fixed and wireless infrastructure, media and
mobility. Of the contracts we are disclosing today, one in
particular represents a significant commitment by a global provider
of broadband services that focuses on markets including the energy,
government and cruise industries. This contract is the largest
single commitment for broadband infrastructure ever received by
Intelsat.
Spengler continued, "Our results are in line with our overall
expectations for 2015, with third quarter revenue of $581 million
reflecting the near-term trajectories of each of our network
services, media and government businesses, and Adjusted EBITDA of
$458 million, or 79 percent of revenue, demonstrating our continued
financial discipline. As a result, today we are reaffirming our
guidance for 2015 revenue, Adjusted EBITDA and capital
expenditures.
"As we execute on our operational priorities, our top focus is
placing new satellites into service. Our Intelsat 34 satellite,
which was launched in August 2015, entered service earlier this
month, providing revenue continuity and growth for our media
customers in Latin America and building our inventory for mobility
applications over the North Atlantic. We have an active campaign
to dramatically enhance our inventory next year as we expect to
launch two media satellites, two Intelsat EpicNG satellites and an
Intelsat EpicNG payload. The schedule for our launch program
remains unchanged. As our next generation Intelsat EpicNG
satellites begin entering service, inventory will further expand,
supporting higher growth applications and service offerings that
provide higher performance, better economics and accelerated market
entry for our customers. A prime example of these services is
IntelsatOne Flex, which we recently introduced for the mobility
sector."
A full-text copy of the press release is available for free at:
http://is.gd/ZTCIHe
About Intelsat
Luxembourg-based Intelsat is the leading provider of satellite
services worldwide. For over 45 years, Intelsat has been
delivering information and entertainment for many of the world's
leading media and network companies, multinational corporations,
Internet Service Providers and governmental agencies. Intelsat's
satellite, teleport and fiber infrastructure is unmatched in the
industry, setting the standard for transmissions of video, data
and voice services. From the globalization of content and the
proliferation of HD, to the expansion of cellular networks and
broadband access, with Intelsat, advanced communications anywhere
in the world are closer, by far.
Intelsat S.A. incurred a net loss of $145 million in 2012, a net
loss of $433.99 million in 2011, and a net loss of $507.76 million
in 2010.
* * *
As reported by the TCR on April 26, 2013, Moody's Investors
Service upgraded Intelsat Investments S.A.'s (Intelsat; formerly
Intelsat S.A.) corporate family rating (CFR) to B3 from Caa1,
while also upgrading ratings for certain of the company's debt
instruments as well as its probability of default rating (PDR;
upgraded to B3-PD from Caa1-PD). The rating action concludes a
review initiated on April 2, 2013, when Intelsat's indirect
ultimate parent company, Intelsat S.A. (formerly Intelsat Global
Holdings S.A.) announced an equity issue with most of the proceeds
reducing debt at Intelsat and its subsidiaries. With the review
concluded, Intelsat's ratings outlook was changed to stable.
The TCR reported on March 25, 2015, that Standard & Poor's Ratings
Services lowered its corporate credit rating on Intelsat S.A. to
'B' from 'B+'. "The ratings downgrade reflects our expectation
that adjusted leverage will remain above 8x through 2016, and that
free operating cash flow will be only modestly positive this year,"
said Standard & Poor's credit analyst Michael Altberg.
* * *
This concludes the Troubled Company Reporter's coverage of Intelsat
until facts and circumstances, if any, emerge that
demonstrate financial or operational strain or difficulty at a
level sufficient to warrant renewed coverage.
KELLERMEYER BERGENSONS: S&P Lowers CCR to 'B-'; Outlook Negative
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on city- or state-based outsourced janitorial services
provider Kellermeyer Bergensons Services LLC (KBS) to 'B-' from
'B'. The outlook is negative.
At the same time, S&P lowered its issue-level ratings on the
first-lien credit facility to 'B-' from 'B'. The recovery rating
on this debt is '3', indicating expectations for meaningful (50% to
70%, in upper half of the range) recovery in the event of a payment
default. S&P also lowered the rating on the second-lien debt to
'CCC' from 'CCC+'. The recovery rating on this debt is '6',
indicating that creditors could expect negligible (0% to 10%)
recovery in the event of a payment default.
"Our rating action reflects KBS' narrowing cushion on the financial
covenant and very high debt leverage resulting from
weaker-than-anticipated performance," said Standard & Poor's credit
analyst Mariola Borysiak. Although S&P anticipates modest profit
growth in 2016, mostly from new business acquisition, the company
is vulnerable to pricing pressure from its large retail customers
and lackluster consumer spending. As a result, S&P believes the
company may breach its total debt leverage covenant in the quarter
ending Dec. 30, 2015, as this covenant becomes more restrictive.
In addition, S&P now projects base-case debt leverage will remain
elevated, around the high-8x area at the end of 2015, and free
operating cash flow will be only modestly positive. This is well
below our previous expectations for debt leverage improving toward
the mid-5x area in 2015.
S&P's ratings also reflect KBS' small size and narrow focus in the
highly competitive and fragmented outsourced janitorial services
industry. Despite the low barriers to entry and pricing pressure
that characterize the industry, KBS has established a defensible
position within the mature outsourced janitorial services sector,
specifically in the retail segment. Although the company benefits
from its multiyear customer contracts, and strong contract renewal,
S&P believes that a loss of a customer could significantly hurt the
company's profitability.
The outlook is negative, reflecting narrowing cushion on the
company's financial covenants. S&P believes the company can breach
the leverage covenant when it becomes more restrictive at the end
of 2015, absent profit growth or a covenant amendment.
S&P could lower the ratings if it believes the company could breach
its financial covenants, which would erode liquidity further. In
addition, further modest weakening of credit measures with
unsustainable debt leverage, EBITDA coverage of below 1.5x, and
free operating cash flow turning negative would result in a lower
rating.
Revision of the outlook to stable would be predicated on S&P's
belief that the company improves its profitability such that it can
sustain its covenant cushion above 10% and improve EBITDA coverage
of interest near 2x.
KEMET CORP: Reports Preliminary Fiscal 2016 2nd Quarter Results
---------------------------------------------------------------
Kemet Corporation reported net income of $7.19 million on $186
million of net sales for the quarter ended Sept. 30, 2015, compared
to net income of $6.33 million on $215 million of net sales for the
same period in 2014.
As of Sept. 30, 2015, the Company had $739 million in total assets,
$609 million in total liabilities and $130 million in total
stockholders' equity.
"Continued margin improvement remains our focus and we are ahead of
our plan achieving another 180 basis point margin improvement this
quarter over the prior quarter," stated Per Loof, KEMET's chief
executive officer. "Our cost structure is in the best shape of my
tenure at KEMET. The team has positioned us to be able to achieve
positive bottom-line results during a time of economic slowdown and
created significant operating leverage for the future as revenue
returns to more normalized levels," continued Loof.
A copy of the press release is available for free at:
http://is.gd/uOUBa4
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 KEMET 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 S&P revised its outlook on
KEMET to 'stable' from 'negative'. S&P affirmed the ratings,
including the 'B-' corporate credit rating.
KEYPOINT GOVERNMENT: S&P Affirms 'B' CCR; Outlook Stable
--------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its 'B'
corporate credit rating on Loveland, Colo.-based KeyPoint
Government Solutions Inc. The outlook was revised to stable from
positive.
At the same time, S&P maintained its 'B+' issue-level rating to the
company's first-lien credit facilities, including a $10 million
revolving facility due 2017, and a $150 million term loan due 2017.
The recovery rating for the first-lien facilities is '2', which
indicates S&P's expectation for lenders to receive substantial (70%
to 90%, upper end of the range) recovery in the event of a payment
default.
The outlook revision to stable from positive reflects S&P's view
that KeyPoint's margin expansion is about one year behind S&P's
prior forecast due to its need to invest in labor to absorb new
business from the OPM. Moreover, S&P believes the company will
need to diversify its customer base more for S&P to consider a
higher rating, as it is vulnerable to decisions made by its
customers. Currently, 85% of KeyPoint's revenues are generated
from business with the OPM. The company faces contract renewals
with the OPM in November 2016. The government could change the
pricing of the contract, which would pressure margins.
The stable outlook reflects S&P's expectation that operating
performance will remain stable over the next year as the company
maintains good service levels ahead of the November 2016 expiry of
the OPM contract. In addition, S&P expects credit metrics to
remain steady at year-end 2015 levels.
KU6 MEDIA: Shareholders Elect 7 Directors
-----------------------------------------
Ku6 Media Co., Ltd., announced the results of the Company's 2015
annual general meeting of shareholders held on Oct. 29, 2015, in
Hong Kong. At the 2015 AGM, the Company's shareholders:
1. elected Feng Gao, Qingmin Dai, Yong Gui, Jun Deng, Robert
Chiu, Mingfeng Chen and Jason Ma to serve as directors of the
Company until the next annual general meeting of shareholders
of the Company and until his/her successor is duly elected
and qualified, or until his/her earlier removal, or earlier
vacation of office; and
2. ratified the appointment of PricewaterhouseCoopers Zhong Tian
CPAs Limited Company as the independent auditor of the
Company to hold office until the next annual general meeting
of shareholders and the authorization of the Board of
Directors of the Company to fix the auditor's remuneration.
About Ku6 Media
Ku6 Media Co., Ltd. -- http://ir.ku6.com/-- is an Internet video
company in China focused on User-Generated Content. Through its
premier online brand and online video Web site --
http://www.ku6.com/-- Ku6 Media provides online video uploading
and sharing service, video reports, information and entertainment
in China.
Ku6 Media reported a net loss of $10.7 million in 2014 following a
net loss of $34.4 million in 2013.
As of June 30, 2015, the Company had US$8.91 million in total
assets, US$14.3 million in total liabilities, and a total
shareholders' deficit of US$5.42 million.
PricewaterhouseCoopers Zhong Tian LLP, in Shanghai, the People's
Republic of China, issued a "going concern" qualification on the
consolidated financial statements for the year ended Dec. 31, 2014,
citing that the Company's recurring losses, negative working
capital, net cash outflows, and uncertainties associated with
significant changes made, or planned to be made, in respect of the
Company's business model, raise substantial doubt about the
Company's ability to continue as a going concern.
LEE STEEL: Stipulation on Entry of Financing Order Entered
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Lee Steel Corporation and its affiliated debtors, The Huntington
National Bank and the Official Committee of Unsecured Creditors
entered into a stipulation providing for entry of a first amended
final order authorizing the Debtors to obtain postpetition
financing and enter into agreements with Huntington Bank.
As of the Petition Date, the Debtors owed Huntington National Bank
an aggregate principal amount of $50,091,702. The Debtors
obligations to Huntington National Bank were secured by valid,
perfected, enforceable and non-avoidable first priority security
interests and liens granted by the Debtors to the Bank on
substantially all of the Debtors' assets and real property.
The Debtors contend that they have requested from Huntington
National Bank, which is likewise willing to extend, certain loans,
advances and other financial terms and accommodations.
The Debtors assert that that their ability to maintain business
relationships with their vendors, suppliers and customers, to pay
their employees and otherwise fund their operations is essential to
their continued viability as they seek to maximize the value of the
assets of their estates for the benefit of all their creditors.
A copy of the Stipulated Order is available for free at:
http://bankrupt.com/misc/Lee_Steel_314_Stip_Financing.pdf
The Debtors are represented by:
Stephen M. Gross, Esq.
Jayson B. Ruff, Esq.
Joshua A. Gadharf, Esq.
MCDONALD HOPKINS LLC
39533 Woodward Avenue
Suite 318
Bloomfield Hills, MI 48304
Telephone: (248)646-5070
Facsimile: (248)646-5075
Email: sgross@mcdonaldhopkins.com
jruff@mcdonaldhopkins.com
jgadharf@mcdonaldhopkins.com
The Official Committee of Unsecured Creditors is represented by:
Scott A. Wolfson, Esq.
Ryan D. Heilman, Esq.
Anthony J. Kochis, Esq.
WOLFSON BOLTON PLLC
3150 Livernois, Suite 275
Troy, MI 48083
Telephone: (248)247-7103
Facsimile: (248)247-7099
Email: swolfson@wolfsonbolton.com
rheilman@wolfsonbolton.com
akochis@wolfsonbolton.com
The Huntington National Bank is represented by:
Steven G. Howell, Esq.
Allison R. Bach, Esq.
DICKINSON WRIGHT PLLC
500 Woodward Ave., Suite 4000
Detroit, MI 48226
Telephone: (313)223-3604
Facsimile: (313)223-3598
Email: showell@dickinsonwright.com
abach@dickinsonwright.com
About Lee Steel Corporation
Novi, Michigan-based Lee Steel Corp., provides flat rolled steel,
including hot rolled steel, cold rolled steel, and exposed coated
products for automotive and other manufacturing industries.
Lee Steel and 2 affiliated companies -- Taylor Industrial
Properties, L.L.C., and 4L Ventures, LLC -- filed for separate
bankruptcy protection (Bankr. D. Del. Case No. 15-45784) on April
13, 2015.
The Hon. Marci B. McIvor presides over the cases. Joshua A.
Gadharf, Esq., at McDonald Hopkins PLC, represents the Debtor.
Huron Business Advisory, serves as financial advisor; and Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Lee Steel disclosed $63,206,282 in total assets and $62,659,806 in
total liabilities.
Hilco Global has purchased the steel processing facility located
at
the Lee Steel Corporation site in Romulus, Michigan. The deal
which was approved in U.S. Bankruptcy Court includes a 200,000
square foot plant and all of the steel processing equipment
located
at that site. The sale is expected to close in mid-September.
The U.S. Trustee for Region 9 appointed three creditors to serve
on
the official committee of unsecured creditors. Conway Mackenzie,
Inc. serves as its financial advisor.
LENNAR CORPORATION: Fitch Assigns BB+ Rating on $350MM Notes
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Fitch Ratings has assigned a 'BB+/RR4' rating to Lennar
Corporation's (NYSE: LEN) proposed offering of $350 million
principal amount of senior notes due 2023. This issue will be
rated on a pari passu basis with all other senior unsecured debt.
Net proceeds from the notes offerings will be used for general
corporate purposes.
KEY RATING DRIVERS
The ratings for Lennar are based on the company's strong track
record over the past 36 plus years, geographic diversity, customer
and product focus, generally conservative building practices and
effective utilization of return on invested capital criteria as a
key element of its operating model. Additionally, there has been
continuity in Lennar's management during this housing cycle and
Fitch considers this management team to be the deepest among the
public builders within its coverage.
The Positive Outlook reflects Lennar's operating performance in
2014 and year-to-date (YTD) in 2015, current and year end projected
2015 and 2016 financial ratios (especially leverage and coverage),
solid liquidity position and favorable prospects for the housing
sector during the balance of 2015 and 2016 and probably 2017.
Fitch believes that the housing recovery is firmly in place
(although the rate of recovery remains well below historical levels
and the recovery will likely continue to occur in fits and starts).
The company did a good job in reducing its inventory exposure
(especially early in the correction) and generating positive
operating cash flow during the recent, severe industry downturn.
Additionally, Lennar steadily, substantially reduced its number of
JVs over the last few years and, as a consequence, has very sharply
lowered its JV recourse debt exposure (from $1.76 billion to $22.4
million as of Aug. 31, 2015).
In contrast to almost all the other public homebuilders Lennar was
profitable in fiscal 2010 and 2011 and the company was solidly
profitable in fiscal 2012, 2013 and 2014. The company's gross
margins are consistently above its peers and contributions from its
Rialto Investment segment have added to profits in 2010, 2011,
2012, 2013 and 2014.
There are still some challenges facing the housing market that are
likely to moderate the intermediate stages of this recovery.
Nevertheless, Fitch believes Lennar has the financial flexibility
to navigate through the sometimes challenging market conditions and
continue to broaden its franchise and invest in land and other
opportunities.
THE INDUSTRY
Housing activity has ratcheted up more sharply in 2015 with the
support of a steadily growing, relatively robust economy throughout
the year. Considerably lower oil prices should restrain inflation
and leave American consumers with more money to spend. The
unemployment rate should continue to move lower (5.0% in 2015).
Credit standards should steadily, moderately ease throughout 2015.
Demographics should be more of a positive catalyst. More of those
younger adults who have been living at home should find jobs and
these 25-35-year-olds should provide some incremental elevation to
the rental and starter home markets. Single-family starts are now
forecast to rise about 11.4% to 722,000 as multifamily volume
expands about 11% to 394,000. Total starts would be just in excess
of 1.1 million. New home sales are projected to increase 20% to
523,000. Existing home volume is expected to approximate 5.280
million, up 6.9%.
New home price inflation should further taper off with higher
interest rates and the mix of sales shifting more to first time
homebuyer product. Average and median home prices should increase
3.0% - 3.5%.
Sparked by a slightly faster growing economy the housing recovery
is expected to continue in 2016. Although interest rates are
likely to be higher, a more robust economy, healthy job creation
and further moderation in lending standards should stimulate
housing activity. Housing starts should approximate 1.24 million
with single-family volume of 0.82 million and multifamily starts of
0.42 million. New home sales should reach 617,000, up 18.0%.
Existing home volume growth should again be mid-single digit
(+4.0%).
Average and median home prices should rise 2.0% - 2.5%.
Challenges remain, including the potential for higher interest
rates, and continued restrictive credit qualification standards.
As Fitch noted in the past, the housing recovery will likely
continue in fits and starts.
LIQUIDITY/DEBT
The company's homebuilding operations ended the third quarter of
2015 with $595.72 million in unrestricted cash and equivalents.
Homebuilder debt totaled $5.26 billion as of August 31, 2015, up
from $4.69 billion at fiscal year-end 2014.
At Aug. 31, 2015, Lennar had a $1.6 billion unsecured revolving
credit facility with certain financial institutions that matures in
June 2019. The proceeds available under the credit facility, which
are subject to specified conditions for borrowing, may be used for
working capital and general corporate purposes. The credit
facility agreement also provides that up to $500 million in
commitments may be used for letters of credit. As of Aug. 31,
2015, there were $575 million of outstanding borrowings under the
credit facility. Lennar believes that it was in compliance with
its debt covenants at Aug. 31, 2015. Also, the company had $315
million of letter of credit facilities with different financial
institutions.
Lennar's debt maturities are well-laddered, with 23.7% of its
senior notes (as of Aug. 31, 2015) maturing through 2017.
Lennar's performance letters of credit outstanding were $243.3
million at Aug. 31, 2015. The company's financial letters of
credit outstanding were $185.6 million at Aug. 31, 2015.
Performance letters of credit are generally posted with regulatory
bodies to guarantee the performance of certain development and
construction activities. Financial letters of credit are generally
posted in lieu of cash deposits on option contracts, for insurance
risks, credit enhancements and as other collateral.
Debt leverage (debt/EBITDA) increased to 4.1x for the
latest-twelve-months (LTM) August 31, 2015 from 4.0x at the
conclusion of 2014, but is down from 4.9x at the end of 2013.
EBITDA-to-interest expense rose from 3.2x at Nov. 30 2013, to 4.3x
at the conclusion of 2014 and 4.6x for the Aug. 31, 2015, LTM
period.
HOMEBUILDING
The company was the second largest homebuilder in 2014 and
primarily focuses on entry-level and first-time move-up homebuyers.
In 2013 and 2014, approximately one third of sales were to the
first-time buyer, half to first-time move-up customers and the
balance is a mix of second-time move-up, luxury and active adult.
So far in 2015 approximately 25% of sales are to the first time
buyer, half to first time move up customers and the balance is a
mix of second time move up, luxury and active adult. The company
builds in 17 states with particular focus on markets in Florida,
Texas and California. Lennar's significant ranking (within the top
five or top 10) in many of its markets, its largely presale
operating strategy, and a return on capital focus provide the
framework to soften the impact on margins from declining market
conditions. Fitch notes that in the past, acquisitions (in
particular, strategic acquisitions) have played a significant role
in Lennar's operating strategy.
As the cycle matures, Lennar is pivoting to a lighter land position
and plans to reduce the number of years of land owned. It will
shorten the tail of new land buys to 3 - 4 years. The company will
endeavor to utilize rolling options and deferred take downs with
sellers and land developers. Lennar will sell non-core holdings of
land.
Compared to its peers, Lennar has had above-average exposure to JVs
during this past housing cycle. Longer-dated land positions are
controlled off balance sheet. The company's equity interests in
its partnerships generally ranged from 10% to 50%. These JVs have
a substantial business purpose and are governed by Lennar's
conservative operating principles. They allow Lennar to
strategically acquire land while mitigating land risks and reduce
the supply of land owned by the company. They help Lennar to match
financing to asset life. JVs facilitate just-in-time inventory
management.
Nonetheless, Lennar has substantially reduced its number of JVs
over the last eight years (from 270 at the peak in 2006 to 33 as of
August 31, 2015, of which 4 had recourse debt, 5 had non-recourse
debt and 24 had no debt). As a consequence, the company has very
sharply lowered its JV recourse debt exposure from $1.76 billion to
$22.4 million as of Aug. 31, 2015. In the future, management will
still be involved with partnerships and JVs, but there will be
fewer of them and they will be larger, on average, than in the
past.
The company did a good job in reducing its inventory exposure
(especially early in the correction) and generating positive
operating cash flow. In 2010, the company started to rebuild its
lot position and increased land and development spending. Lennar
spent about $600 million on new land purchases during 2011 and
expended about $225 million on land development during the year.
This compares to roughly $475 million of combined land and
development spending during 2009 and about $704 million in 2010.
During 2012, Lennar purchased approximately $1 billion of new land
and spent roughly $302 million on development expenditures. Land
spend totaled almost $1.9 billion in 2013, and development
expenditures reached about $600 million, double the level of 2012.
Approximately, $1.5 billion was expended on land and $1.1 billion
on development in 2014. Fitch expects that total real estate
spending in 2015 could be up slightly (perhaps $100 million) with
about 55% expended on land and 45% on development activities.
The company was slightly less cash flow negative in 2014 ($788.49
million) than in 2013 ($807.71 million). Lennar is likely to be
less cash flow negative in 2015. The company could be cash flow
positive in 2016.
Fitch is comfortable with this real estate strategy given the
company's cash position, debt maturity schedule, proven access to
the capital markets and willingness to quickly put the brake on
spending as conditions warrant.
Homebuilding realized $5.79 billion in revenues (88.7% of total
revenues) and $834.14 million in operating profits 85.8% of the
total) YTD in FY 2015.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for Lennar include:
-- Industry single-family housing starts improve 11.4%, while
new and existing home sales grow 20% and 6.9%, respectively,
in 2015;
-- Lennar's homebuilding revenues increase at about a 21% pace.
Although homebuilding EBITDA margins erode 140 bps this year
due to higher expenses (especially land costs) and lesser
home price inflation, homebuilding EBITDA increases about
9.0%;
-- The company's Debt/EBITDA approximates 3.8x and interest
coverage reaches about 5.4x by year end 2015;
-- Lennar spends approximately $2.5-2.7 billion on land
acquisition and development activities this year;
-- The company maintains an adequate liquidity position (well
above $500 million) with a combination of unrestricted cash
and revolver availability.
RATING SENSITIVITIES
Future ratings and Outlooks will be influenced by broad housing
market trends as well as company-specific activity, such as trends
in land and development spending, general inventory levels,
speculative inventory activity (including the impact of high
cancellation rates on such activity), gross and net new order
activity, debt levels, free cash flow trends and uses, and the
company's cash position.
Fitch would consider taking further positive rating action if the
recovery in housing accelerates and Lennar shows steady improvement
in credit metrics (such as debt-to-EBITDA leverage consistently
less than 3x), while maintaining a healthy liquidity position (in
excess of $1 billion in a combination of cash and revolver
availability) and begins generating positive cash flow from
operations starting in 2016 as it moderates its land and
development spending.
Conversely, negative rating actions could occur if the recovery in
housing dissipates and Lennar maintains an overly aggressive land
and development spending program. This could lead to sharp
declines in profitability, consistent and significant negative
quarterly cash flow from operations, higher leverage and
meaningfully diminished liquidity position (below $500 million).
FULL LIST OF RATINGS
Fitch currently has these ratings for Lennar Corp.:
-- Long-term IDR 'BB+';
-- Senior unsecured debt 'BB+/RR4';
-- Unsecured revolving credit facility 'BB+/RR4'.
The Rating Outlook is Positive.
In accordance with Fitch's updated Recovery Rating (RR)
methodology, Fitch is now providing RRs to issuers with IDRs in the
'BB' category. The Recovery Rating of '4' for Lennar's unsecured
debt supports a rating of 'BB+', and reflects average recovery
prospects in a distressed scenario.
LEVEL 3 FINANCING: Fitch Assigns BB Rating on Sr. Unsec. Notes
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Fitch Ratings has assigned a 'BB/RR2' issue rating to Level 3
Financing, Inc.'s issuance of senior unsecured notes due 2024.
Level 3 Financing is a wholly owned subsidiary of Level 3
Communications, Inc. (LVLT). The Issuer Default Rating (IDR) for
both LVLT and Level 3 Financing is 'BB-' with a Stable Rating
Outlook. LVLT had approximately $11 billion of consolidated debt
outstanding on Sept. 30, 2015.
Proceeds from the senior note offering along with cash on hand are
expected to be used to redeem $900 million outstanding aggregate
principal amount of Level 3 Financing's 8.625% senior notes due
2020. The notes currently have $900 million aggregate principal
amount outstanding. The new notes will rank pari passu with Level
3 Financing's existing senior unsecured indebtedness. Outside of
the extension of the company's maturity profile and an expected
reduction of interest expense related to this transaction, LVLT's
credit profile has not substantially changed.
KEY RATING DRIVERS
Leverage on Target: LVLT remains committed to deleveraging to the
low end of its target of between 3x to 5x net leverage. The
enhanced scale and ability to generate meaningful FCF resulting
from TWTC reinforces Fitch's expectation for further strengthening
of LVLT's credit profile. Fitch foresees LVLT leverage will
approach 4.2x by the end of 2015 and under 4x by year-end 2016 as
the company clearly is operating within its 3x to 5x net leverage
target.
Strengthening Credit Profile: LVLT's credit profile continues to
improve in line with Fitch's expectations as the company
capitalizes on its on-going revenue mix transformation, growing
high-margin core network services revenues, and the cost and
revenue benefits associated with the TWTC acquisition. Fitch
anticipates LVLT's credit profile will continue to strengthen over
the ratings horizon as the company benefits from anticipated EBITDA
growth, strong free cash flow (FCF) generation and modest debt
reduction.
TWTC Acquisition Supports Strategy: The TWTC acquisition is in line
with LVLT's strategy to shift its revenue and customer focus to
become a predominately enterprise-focused entity. TWTC's strong
metropolitan network supports LVLT's overall strategy.
Synergies Fuel Margin Expansion: The integration of TWTC is LVLT's
highest priority as an organization and the key integration and
synergy assumptions the company disclosed when the transaction was
announced remain unchanged. Since the transaction closed, Level 3
has achieved approximately $170 million of annualized run rate
EBITDA synergies through the end of the third quarter 2015 (3Q15).
LVLT indicates it remains on track to achieve 70% or $140 million
of its annualized run-rate synergy target by the end of 1Q16.
FCF Enhances Credit Profile: LVLT is poised to generate sustainable
levels of FCF (defined as cash flow from operations less capital
expenditures and dividends). Fitch believes the company's ability
to grow high-margin core network services (CNS) revenues coupled
with the strong operating leverage inherent in its operating
profile position the company to generate consistent levels of FCF.
Fitch anticipates LVLT FCF generation will exceed 10% of
consolidated revenues by year-end 2016 on a pro forma basis.
Revenue Mix Transformation Proceeding: LVLT's operating strategies
are aimed at shifting its revenue and customer focus to become a
predominantly enterprise-focused entity. The company's network
capabilities, in particular its strong metropolitan network along
with a broad product and service portfolio emphasizing IP-based
infrastructure and managed services, provide the company with a
solid base to grow its enterprise segment revenues.
Strong Operating Leverage: The products and services LVLT sells
combined with its strategy to sell services 'on net' enable the
company to generate significant operating leverage. At scale, the
services sold within this business segment generate 60% incremental
EBITDA margins. From Fitch's perspective, the company must be
successful in growing the CNS revenue base to improve its credit
profile and generate FCF.
Overall, Fitch's ratings incorporate LVLT's improving competitive
position while acknowledging its smaller market share and lack of
scale relative to larger and better capitalized market
participants. The ratings for LVLT reflect the company's strong
metropolitan network facilities position relative to alternative
carriers, as well as the diversity of its customer base and service
offering, and a relatively stable pricing environment for a
significant portion of its service portfolio.
Outside of material change to its financial strategy, ratings
concerns center on event-driven merger and acquisition activity and
the resultant increase in integration risks, and the sensitivity of
the company's operating profile to the effects of a weaker economic
outlook or a more competitive operating and pricing environment.
Fitch expects that M&A activity will remain a key component of
LVLT's overall growth strategy. M&A is expected to focus on
building incremental network and product capabilities and building
scale in Europe and Latin America.
LVLT's enterprise segment continues to drive overall revenue growth
within CNS as the company stands to benefit from favorable secular
trends including explosive bandwidth demand growth (video), the
growth in number of devices connected to the Internet, and the
increasing globalization of enterprises. In addition, Fitch
believes that revenue growth prospects within CNS will benefit from
the transition among enterprise customers from legacy time division
multiplexing (TDM) communications infrastructure to Ethernet or IP
VPN infrastructure based in Internet protocol. Revenues generated
from enterprise customers accounted for approximately 72% of CNS
revenues during the quarter ended Sept. 30, 2015. From a regional
perspective, North America CNS revenue represented 80% of total CNS
revenue during 3Q15, up from approximately 78% during the same
period last year.
The key integration and synergy assumptions LVLT disclosed when the
TWTC transaction was announced remain unchanged. Through the 3Q
the company achieved $40 million of expected capital expenditure
synergies and realized $170 million of annualized run-rate
operating synergies. The operating cost synergies consist of $35
million on network access cost synergies and $135 million of
operating expense synergies. Going forward the focus will be on
achieving incremental network access cost synergies, as the company
has achieved its $90 million of annualized run-rate operating
expense synergies. From a timing perspective, LVLT expects to
capture 70% of the run-rate operating cost synergies or $140
million of its total synergy target by the end of 1Q16.
Leverage and Financial Policy
The focus of LVLT's capital structure strategy is to strengthen the
company's overall credit profile and efficiently manage its
maturity profile. LVLT remains committed to deleveraging to the
low end of its target of between 3x and 5x on a net debt basis. The
pace of further deleveraging will largely depend on the company's
ability to capture anticipated cost synergies and capitalize on
incremental EBITDA growth stemming from the positive operating
momentum within LVLT's CNS segment.
Total debt outstanding as of Sept. 30, 2015 was approximately $11
billion, reflecting a modest 2.9% decline relative to the $11.4
billion of debt outstanding as of Dec. 31, 2014. LVLT's
outstanding debt materially increased during 2014 to facilitate the
tw telecom acquisition. Pro forma leverage as of the LTM period
ended Sept. 30, 2015, considering the tw telecom acquisition was
4.5x (4.2x excluding transaction and integration costs) and is
expected to decrease to 4.2x by year=end 2015 and dip below 4x by
year-end 2016.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case include:
-- LVLT continues to be successful in achieving anticipated
cost synergies related to its acquisition of tw telecom,
specifically to realize 70% of the $200 million run-rate
annualized cost synergies within 18 months of the close of
the TWTC acquisition.
-- CNS revenue growth ranging between 2% and 3% during 2015
(relative to 2014 pro forma CNS revenues) driven by
continued strong growth within the company's North American
Enterprise segment.
-- LVLT's network access margin (gross margin) ranging between
65% and 66% during 2015 and growing to over 67% by year-end
2017.
-- Capital expenditures will approximate 15% of consolidated
revenues.
-- FCF generation ranging between $600 million and $650 million
during 2015, exceeding 10% and 12% during years ended 2016
and 2017, respectively.
-- Debt levels are expected to remain relatively consistent and
Fitch anticipates that LVLT will repay the floating-rate
notes due 2018 ($300 million outstanding June 30, 2015) with
available cash on hand.
RATING SENSITIVITIES
What Could Lead to a Positive Rating Action:
Positive rating action would likely coincide with the expectation
that Level 3 will maintain leverage at 3.5x or lower while
consistently generating positive FCF with FCF/adjusted debt of 8%
or greater. Additionally the company will need to demonstrate
positive operating momentum characterized by consistent core
network services revenue growth, gross margin expansion, no
material delays in achieving anticipated cost synergies, and lack
of a material erosion of revenue churn.
What Could Lead to a Negative Rating Action:
Negative rating actions are more likely to coincide with a
perceived weakening of LVLT's operating profile, as signaled by
deteriorating margins and revenue erosion brought on by difficult
economic conditions or competitive pressure. Additionally,
negative rating actions could result from discretionary management
decisions including, but not limited to, execution of merger and
acquisition activity that increases leverage beyond 5x in the
absence of a credible deleveraging plan.
LIQUIDITY
LVLT reported $494 million of FCF generation during the LTM ended
Sept. 30, 2015. Based on public guidance, the company expects to
generate FCF of $600 million to $650 million during 2015, which is
in line with Fitch's expectations. Looking forward, FCF generation
should accelerate as integration costs diminish and cost synergies
materialize. Fitch anticipates LVLT FCF generation will exceed 10%
of consolidated revenues by year-end 2016 on a pro forma basis. In
addition to LVLT's positive operating momentum driving EBITDA
growth, additional factors such as interest expense savings derived
from capital market activities completed during 2014 and 2015 and
on-going operating cost optimization efforts position the company
to grow FCF during the ratings horizon.
Fitch believes that LVLT's liquidity position is adequate given the
rating and that overall financial flexibility is enhanced with
positive FCF generation. The company's liquidity position was
primarily supported by cash carried on its balance sheet, which as
of June 30, 2015, totaled approximately $608 million (net of the
$83 million of cash held in Venezuelan bolivares by its Venezuelan
subsidiary, which Fitch views as restricted) and expected FCF
generation. Importantly, there are no restrictions on the
company's ability to repatriate foreign cash (other than the
conversion and repatriation restrictions existing in Venezuela and
Argentina) to fund domestic operations including debt service. The
company does not maintain a revolver, which limits its financial
flexibility in Fitch's opinion.
LVLT's maturity profile is manageable within the context of FCF
generation expectations and access to capital markets. The company
does not have material scheduled maturities during the remainder of
2015, and the next scheduled maturity is not until 2018 when
approximately $300 million of debt is scheduled to mature.
FULL LIST OF RATING ACTIONS
Fitch currently rates LVLT as:
LVLT
-- IDR 'BB-';
-- Senior unsecured notes 'B+/RR5'.
Level 3 Financing, Inc.
-- IDR 'BB-';
-- Senior secured term loan 'BB+/RR1';
-- Senior unsecured notes 'BB/RR2'.
The Rating Outlook is Stable.
LEVEL 3: Has Private Offering of $900 Million Senior Notes
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Level 3 Communications, Inc., announced that Level 3 Financing,
Inc., its wholly owned subsidiary, has agreed to sell $900 million
aggregate principal amount of its 5.375% Senior Notes due 2024 in a
private offering to "qualified institutional buyers", as defined in
Rule 144A under the Securities Act of 1933, as amended, and
non-U.S. persons outside the United States under Regulation S under
the Securities Act of 1933, as amended.
The Notes were priced to investors at 100 percent of their
principal amount and will mature on Jan. 15, 2024. Level 3
Financing's obligations under the Notes will be fully and
unconditionally guaranteed on an unsecured basis by Level 3
Communications, Inc. The net proceeds from the offering of the
Notes, together with cash on hand, will be used to redeem, satisfy
and discharge, defease or otherwise repay or retire all of Level 3
Financing's approximately $900 million outstanding aggregate
principal amount of 8.625% Senior Notes due 2020.
The offering is expected to be completed on Nov. 13, 2015, subject
to the satisfaction or waiver of customary closing conditions.
The Notes will not be registered under the Securities Act of 1933
or any state securities laws and, unless so registered, may not be
offered or sold except pursuant to an applicable exemption from the
registration requirements of the Securities Act of 1933 and
applicable state securities laws.
About Level 3 Communications
Headquartered in Broomfield, Colorado, Level 3 Communications,
Inc., is a publicly traded international communications company
with one of the world's largest communications and Internet
backbones.
For the year ended Dec. 31, 2014, the Company reported net income
of $314 million on $6.77 billion of revenue compared to a net loss
of $109 million on $6.31 billion of revenue during the prior year.
As of June 30, 2015, the Company had $20.8 billion in total assets,
$14 billion in total liabilities and $6.8 billion in total
stockholders' equity.
* * *
In September 2015, Fitch Ratings has upgraded the Issuer Default
Rating (IDR) assigned to Level 3 Communications, Inc. (LVLT) and
its wholly owned subsidiary level 3 Financing, Inc. (Level 3
Financing) to 'BB-' from 'B+'. The rating action recognizes LVLT's
strengthening financial and operating profile as the company
completes the integration of tw telecom, Inc.
In June 2013, Standard & Poor's Ratings Services raised its
corporate credit rating on Level 3 to 'B' from 'B-'. "The upgrade
reflects improved debt leverage, initially from the acquisition of
the lower-leveraged Global Crossing in October 2011, and
subsequently from realization of the bulk of what the company
expects to eventually be $300 million of annual operating
synergies," said Standard & Poor's credit analyst Richard
Siderman.
As reported by the TCR on Aug. 17, 2015, Moody's Investors Service
upgraded Level 3 Communications, Inc.'s corporate family rating
(CFR) to Ba3 from B2. Level 3's Ba3 CFR is based on the company's
solidifying business and financial profiles as it integrates the
former tw telecom, inc., with Moody's anticipating continued margin
improvement as synergies are realized, and as higher margin
Internet Protocol-based services replace legacy services.
LIFE PARTNERS: Can Use $25-Mil. of Maturity Funds
-------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas issued
a final order authorizing Life Partners Holdings Inc. and its
debtor-affiliates, and H. Thomas Moran II, the Debtors' Chapter 11
trustee, to use up to $25 million of so-called maturity funds.
The Court ordered Advance Trust and Life Escrow, LTA and Purchase
Escrow Services to disburse up to $25 million of maturity funds in
accordance with the written instructions of the trustee and
subsidiary Debtors.
The Trustee and the Debtors said they will use the Maturity Funds
as a source of financing for the bankruptcy Cases subject to the
terms and provisions set forth herein, which include, among other
things:
-- repayment with interest (10% annual rate);
-- first priority liens and security interests on the Debtors'
policy-related assets and causes of action;
-- super-priority administrative claims; and
-- repayment contemplated at or near the effective date of the
plan of reorganization.
The U.S. Bankruptcy Court previously authorized the Chapter 11
Trustee to immediately use $1.6 million of the funds, which are
generated by the maturity of life insurance policies to pay
expenses related to the bankruptcy cases. The Trustee needs
continued access to those funds:
-- pay or reimburse premiums on abandoned interests and
Distressed Policies from March 13, 2015 forward as to LPHI and from
May 19, 2015 forward as to LPI and LPIFS [approximately $5
million];
-- pay or reimburse operating expenses from March 13, 2015
forward as to LPHI and from May 19, 2015 forward as to LPI and
LPIFS [approximately $3 million];
-- pay or reimburse expenses for the noticing agent, Epiq
Systems [approximately $3 million]; and
-- pay reasonable and necessary administrative expenses incurred
by the Trustee or any of the Debtors in accordance with an agreed
budget to be filed with the Court, in an amount not to exceed $14
million.
The use of Maturity Funds is referred to as the "Maturity Funds
Facility." All Loaned Maturity Funds will be withdrawn pro rata
from all maturities being held in escrow.
The Maturity Funds facility will bear simple interest at a rate of
10% per annum, commencing the date that is 120 days after the
related Maturity Funds were received by the respective escrow
agent;
The lending investors will be deemed to have valid, enforceable and
fully perfected security interests in and liens on the following
unencumbered collateral for any diminution in value of the lending
investors' interest in the Loaned Maturity Funds. To the extent
that the lending investor financing liens are insufficient to
provide the lending investors with adequate protection, the lending
investors will be afforded an allowed administrative superpriority
expense claim.
According to court documents, the Trustee, the Debtors, the
Official Committee of Unsecured Creditors, and the Consenting
Constituencies have participated in good-faith negotiations in an
effort to formulate a long-term financing and restructuring
proposal and short-term bridge financing to enable confirmation of
a plan that benefits all constituencies.
As reported by The Troubled Company Reporter on Sept. 28, 2015, Mr.
Moran said the Debtors, the Committee and certain key
creditor/Investor groups ("Consenting Constituencies") have entered
into an agreement in principle regarding the terms of a
comprehensive and consensually negotiated restructuring plan. He
further said the Negotiated Restructuring presents a compromise and
settlement of claims regarding ownership and other issues that is
subject to and will be effective upon plan confirmation.
The Negotiated Restructuring is generally outlined as follows:
(1) Upon confirmation, the life settlement policies will be
(a) owned by the investors who purchased fractional interests in a
life insurance policy ("Fractional Interest Holders"), or (b)
pledged as security for promissory notes purchased by investors
through retirement accounts ("IRA Holders" and together with the
Fractional Interest Holders, the "Current Holders").
(2) In exchange for certainty on ownership and other issues,
and a confirmed plan of reorganization favorable to Current
Holders, Current Holders will be making an across- the-board
contribution (not to exceed 10%) from all assets in dispute to fund
the Debtors' ability to exit bankruptcy and create a mechanism to
provide for other creditors.
(3) Current Holders will be allowed to choose, for themselves,
to (a) continue as holders and pay all related costs, (b) rescind
their purchases or (c) assign their interests to a fund (the
"Policy Trust") and be relieved of having to pay premiums and other
related costs.
(4) A Policy Trust will be created to hold, and pay its share
of carrying costs for, all abandoned, assigned and compromised
portions of fractional interests in life settlement policies. The
beneficiaries of the Policy Trust will be investors who assign
their fractional positions to the Policy Trust, including as to the
across-the-board contribution described above.
(5) A Creditors' Trust will be created to pursue litigation.
The beneficiaries of the Creditors' Trust will be creditors of the
Debtors, investors who choose to rescind, and the Policy Trust.
(6) A new company will be created to service the life
insurance portfolio that will be owned by the Policy Trust.
(7) A secondary market for the resale of fractional interests,
subject to compliance with applicable securities laws, will be
permitted.
In an earlier filing, Mr. Moran told the Court that the Negotiated
Restructuring presents the most expedient and cost-effective path
forward to preserving and maximizing the value of the Debtors'
estates for the benefit of their Investors, creditors, and other
stakeholders. He said the Debtors and the Consenting Constituencies
will move forward with the Negotiated Restructuring using internal
financing sources.
Mr. Moran also noted that currently, ATLES and PES are holding in
excess of $33 million in funds generated by the maturity of life
insurance policies and that there is approximately $174 million of
cash surrender value associated with the policies.
In furtherance of reaching the Negotiated Restructuring, Mr. Moran
and the Subsidiary Debtors sought permission to use the Maturity
Funds as a source of financing for the bankruptcy cases subject to
the following terms and provisions, among other things: (a)
repayment with interest (10% annual rate); (b) first priority liens
and security interests on the Debtors' policy-related assets and
causes of action; (c)superpriority administrative claims; and (d)
repayment contemplated at or near the effective date of the plan of
reorganization.
Mr. Moran asserted that unless the Debtors obtain approval of the
Negotiated Financing, the Debtors will be unable to implement the
Negotiated Restructuring and their cases would likely be candidates
for conversion to cases under Chapter 7.
About Life Partners
Headquartered in Waco, Texas, Life Partners Holdings, Inc. --
http://www.lphi.com/-- is the parent company engaged in the
secondary market for life insurance, commonly called "life
settlements." Since its incorporation in 1991, Life Partners,
Inc., has completed over 162,000 transactions for its worldwide
client base of over 30,000 high net worth individuals and
institutions in connection with the purchase of over 6,500 policies
totaling over $3.2 billion in face value.
LPHI is a publicly traded company incorporated in Texas and its
common stock has been delisted from the NASDAQ (formerly trading
under the symbol LPHI).
Life Partners Holdings sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Tex. Case No. 15-40289) on Jan. 20,
2015.
The case is assigned to Judge Russell F. Nelms. J. Robert Forshey,
Esq., at Forshey & Prostok, LLP, serves as counsel to the Debtor.
LPHI disclosed $2,406,137 in assets and $52,722,308 in liabilities
as of the Chapter 11 filing.
The official committee of unsecured creditors formed in the case
tapped Munsch Hardt Kopf & Harr, P.C., as counsel.
Tracy A. Bolt of BDO USA, LLP, was named as examiner for the
Debtor's case. At the behest of the U.S. Securities and Exchange
Commission, the U.S. Trustee, and the Creditors Committee, the
Court ordered the appointment of a Chapter 11 trustee. On March
13, 2015, H. Thomas Moran II was appointed as Chapter 11 trustee in
LPHI's case. The trustee is represented by Thompson & Knight LLP.
The Chapter 11 trustee signed Chapter 11 bankruptcy petitions for
LPHI's subsidiaries on May 19, 2015: Life Partners Inc. (Case No.
15-41995) and LPI Financial Services, Inc. (Case No. 15-41996).
Life Partners is estimated to have $100 million to $500 million in
assets and more than $1 billion in debt. LPI Financial estimated
less than $50,000.
MAGNUM HUNTER: Moody's Lowers CFR to Caa3, Expects Default
----------------------------------------------------------
Moody's Investors Service downgraded Magnum Hunter Resources
Corporation's Corporate Family Rating to Caa3, Probability of
Default Rating to Caa3-PD, senior secured second-lien term loan
rating to B3 and senior unsecured notes rating to Ca. Moody's
affirmed the company's SGL-4 Speculative Grade Liquidity Rating.
The outlook remains negative.
"The downgrade reflects our view that MHR will need to do a debt
restructuring in a continued low commodity price environment, and
may miss the coupon payment on its 9.75% $600 million senior notes
due on November 15 absent a substantive asset sale," said Sajjad
Alam, Moody's AVP-Analyst. "MHR is aggressively looking to divest
assets, including its midstream gas gathering system (Eureka
Hunter) and a portion of its undeveloped acreage, to raise
liquidity."
Issuer: Magnum Hunter Resources Corporation
Downgraded:
Corporate Family Rating, Downgraded to Caa3 from Caa2
Probability of Default Rating, Downgraded to Caa3-PD from Caa2-
PD
US$600M 9.75% Senior Unsecured Regular Bond/Debenture,
Downgraded to Ca (LGD5) from Caa3 (LGD5)
US$340M Senior Secured 2nd Lien Term Loan, Downgraded to B3
(LGD2) from B2 (LGD2)
Ratings Affirmed:
Speculative Grade Liquidity Rating, Affirmed SGL-4
Outlook Action:
Maintain Negative Outlook
RATINGS RATIONALE
MHR's Caa3 Corporate Family Rating reflects its untenable capital
structure, poor liquidity, weak capital productivity and cash
margins, and relatively small natural gas weighted production and
reserve base in the Appalachia. The Caa3 rating also considers the
value in MHR's significant undeveloped acreage position in the
Marcellus and Utica Shale plays as well as in the company's
midstream (Eureka Hunter) assets. High interest costs and
preferred dividend payouts have historically drained MHR's
liquidity and limited its ability to sufficiently invest in its
core E&P operations. Despite debt and equity issuances, several
asset sales, and voluntary cost reductions since late-2014, MHR has
been unable to shore up liquidity and is facing a potential
interest payment default in November 2015. The company announced
on Oct. 9, 2015, that it had hired PJT Partners LP and Kirkland &
Ellis LLP to explore strategic alternatives to address its
liquidity and capital structure challenges.
MHR has weak liquidity which is reflected in the SGL-4 rating. The
company had only $9 million of cash at June 30, 2015, and
$6 million available under its $50 million secured borrowing base
revolving credit facility after accounting for $5 million of
drawings and $39 million of letters of credit. The company is
trying to sell additional assets to be able to make the next $29
million coupon payment on its unsecured bonds in November 2015.
While the company has been able to stave off technical default
through serial asset sales and a number of other liquidity
enhancing measures since 2014, Moody's believes asset dispositions
will become increasingly difficult in depressed oil and natural gas
price environment. MHR obtained a number of amendments and waivers
from its banks to maintain continued access to the credit facility
in 2015. The revolver financial covenants require maintenance of a
maximum total secured net debt to EBITDAX of 2.5x (stepping down to
2x on March 31, 2016) and a minimum current ratio of 1x. The
second lien term loan requires a total proved reserve coverage
ratio of 1.5x and a total proved developed producing reserve
coverage ratio of 1x. While the company received a waiver to
comply with the revolver covenants at the end of second quarter,
prospective compliance remains highly uncertain. The company is
working with a gas marketing firm to eliminate the $39 million of
LCs posted against firm transportation contracts to free up
borrowing capacity under the facility, as well as aggressively
pursuing additional asset sales
The $340 million second lien term loan facility is rated B3, three
notches above the CFR given the significant loss absorption cushion
afforded by the company's $600 million senior unsecured notes. The
senior notes are rated at Ca because of their subordinated claim to
MHR's assets behind first-lien revolving credit facility and the
second lien term loan.
The negative outlook reflects the high degree of uncertainty around
MHR's liquidity, production and cash flows. The CFR will be
downgraded if MHR restructures its debt or misses an interest
payment. An upgrade is unlikely through 2016 given our expectation
of weak commodity prices and MHR's high leverage. A significant
reduction in debt level, sufficient liquidity to fund the next 12
months' cash requirements, and an EBITDAX to interest coverage
ratio approaching 1x will be pre-requisites for an upgrade.
The principal methodology used in this rating was the Global
Independent Exploration and Production Industry published in
December 2011.
Magnum Hunter Resources Corporation is a Irving, Texas based
publicly traded oil and gas exploration and production (E&P)
company with principal assets in the states of West Virginia, Ohio,
and North Dakota.
MGM RESORTS: Fitch Affirms 'B+' IDR; Outlook Positive
-----------------------------------------------------
Fitch Ratings has affirmed the Issuer Default Ratings of MGM
Resorts International at 'B+' and MGM's Macau subsidiaries, MGM
Grand Paradise and MGM China, at 'BB'. The Rating Outlook remains
Positive on MGM and Stable on MGM's Macau subsidiaries. The
affirmation takes into account MGM's plan to contribute 10 of its
assets into a newly formed REIT subsidiary, MGM Growth Properties
LLC (MGP).
MGP' assets will be leased back to MGM under a triple-net lease and
MGP will assume $4 billion of MGM's debt. MGP will issue debt and
equity to refinance the assumed debt with MGM owning roughly 70% of
MGP pro forma for the equity raise per the company's comments. MGM
will retain Bellagio, MGM Grand and Circus Circus. MGM's Maryland
and Massachusetts projects will remain with MGM; however, MGP will
retain a right of first offer for the projects.
Fitch expects the transaction to be largely leverage neutral for
MGM - on both a consolidated and wholly-owned basis - under more
conservative assumptions, namely zero equity raise at MGP. Fitch
currently views MGM's credit largely on a consolidated basis,
adjusting EBITDA down for income attributable to minority interest
associated with MGM China. The transaction will leave the reported
consolidated income statement largely the same and, as with MGM
China, Fitch will subtract income attributable to MGP's minority
interest.
Pro forma LTM consolidated leverage (assuming zero equity raise)
increases from 6.9x to 7.0x, but has a chance to decline into the
mid-6x range depending on amount of equity raised. On a
wholly-owned basis, rent adjusted leverage declines to 7.8x from
7.9x without giving credit to dividends from the unconsolidated
entities - CityCenter, Borgata or Grand Victoria.
MGM remains on a trajectory to a 'BB-' IDR as its consolidated
leverage approaches 5x. Fitch expects leverage to start
approaching 5x in 2017 when MGM National Harbor and MGM Cotai open.
However, Fitch could upgrade MGM's IDR to 'BB-' sooner as its path
towards 5x becomes more clear. When considering an upgrade, Fitch
will weigh the execution of the REIT transaction and Macau's
operating trends, which seem to be stabilizing. MGM demonstrating
progress with its $300 million Profit Growth Plan, which is not
incorporated into Fitch's forecasts, can also be a catalyst for an
upgrade. Conversely, Fitch could revise MGM's Outlook to Stable if
Macau's operating environment worsens or the cannibalization from
the new Cotai resorts is worse than Fitch anticipates.
An upgrade of the IDR to 'BB-' would have no impact on MGM's issue
specific ratings with the credit facility likely maintaining its
'BB+/RR1' and the unsecured bonds 'BB/RR2' ratings. This is
because Fitch compresses the recovery-related notch dispersion
around the IDR in the 'BB' category. Fitch expects MGM to
refinance the $2.7 billion outstanding on the existing U.S.
facility with the MGP transaction, given the facility's lack of
prepayment penalties and its restrictive covenants. Fitch suspects
that MGM will further target a portion of the $1.5 billion of
unsecured notes coming due in 2016. The bonds' sale-and-lease
covenants do not apply, since the covenant restrictions exclude
transactions with majority-owned subsidiaries.
Pro forma for the MGP transaction Fitch expects the recovery
prospects for MGM's unsecured bonds to remain strong. The bonds
will continue to benefit from tight lien covenants, MGM's ownership
of Bellagio and MGM Grand, and MGM's equity interest in MGM China,
MGP and unconsolidated entities. Fitch estimates better than 90%
recovery for the bonds pro forma for the transaction. Key recovery
assumptions include $1 billion of new secured debt at MGM used to
fund U.S. development capex; 10x EBITDA/EV multiple and $4 billion
of debt at MGP; and 1.9x rent coverage for MGM's OpCo assets and
25%-30% stress on LTM EBITDA pro forma for leases.
Key Assumptions
-- MGM's consolidated revenues decline by 8% in 2015 reflecting
a 32% decline at MGM China. Same-store revenues grow in the
low- to mid-single digit range thereafter. Fitch assumes
$750 million, $825 million and $450 million of incremental
revenues from MGM Cotai (250 tables assumed), MGM National
Harbor and MGM Springfield, respectively. Fitch estimates
property EBITDA margins of about 24% for MGM through the
projection horizon. The Profit Growth Plan is not factored
into Fitch's forecasts.
-- MGM starts to pay $500 million per year in dividends in
2018; MGM China dividends is $400 million in 2016 and $700
million thereafter; MGM applies cash on hand and all FCF to
pay down debt until 2018; MGM receives $80 million from the
CityCenter project per year, and no other development capex
is undertaken.
RATING SENSITIVITIES
Fitch sees MGM's IDR migrating towards the 'BB' category as its
consolidated leverage becomes more comparable to its global peers.
Fitch believes this would occur as gross leverage starts to migrate
towards 5x on gross basis, which occurs around 2017 in our
forecast. The upgrade would be predicated on Fitch's belief that
MGM wants to maintain solid balance sheet strength, something that
is consistent with the company's remarks on its 3Q15 earnings call.
Fitch would consider revising the Outlook to Stable or Negative if
Macau's operating stabilization is derailed or Las Vegas' operating
trends reverse meaningfully. The Outlook can also be revised if
MGM demonstrates more aggressive shareholder-friendly activity than
is now anticipated by Fitch. MGM China's and MGM Grand Paradise's
IDRs maintain headroom for further upward rating pressure should
conditions in Macau stabilize and MGM Cotai ramps up as expected.
FULL LIST OF RATINGS
Fitch has affirmed these:
MGM Resorts International
-- IDR at 'B+'; Outlook Positive;
-- Senior secured credit facility at 'BB+/RR1';
-- Senior unsecured notes at 'BB/RR2'.
MGM China Holdings, Ltd and MGM Grand Paradise S. A.
(co-borrowers)
-- IDRs at 'BB'; Outlook Stable;
-- Senior secured credit facility at 'BBB-/RR1'.
MINI MASTER: To Seek Confirmation of Reorganization Plan Dec. 15
----------------------------------------------------------------
Mini Master Concrete at a hearing on Dec. 15 at 9:00 a.m. will ask
the U.S. Bankruptcy Court for the District of Puerto Rico to
confirm its reorganization plan that promises to return 100 cents
on the dollar to secured creditors and a 5% recovery for unsecured
creditors.
The Bankruptcy Court held a hearing on the adequacy of the
information in the Disclosure Statement on Sept. 16.
On Oct. 19, the Debtor filed an Amended Disclosure Statement and an
Amended Plan.
On Oct. 23, Judge Mildred Caban Flores entered an order approving
the Amended Disclosure Statement and scheduling a Dec. 15 hearing
to consider confirmation of the Plan. Objections to confirmation
of the Plan are due 14 days prior to the hearing.
The Reorganization Plan
Mini Master Concrete filed with the U.S. Bankruptcy Court for the
District of Puerto Rico a proposed reorganization plan that
proposes to fully pay secured creditors through a transfer of
certain properties and monthly installment payments over a
360-month period, and return 5% to unsecured creditors through 60
consecutive monthly installments.
The estimated percentage recovery for claims and interests are:
Projected
Claim/Interest Amount Impairment Recovery
-------------- ------ ---------- --------
Class 1 - Secured
Claim of Economic
Devt. Bank of P.R. $4,061,649 Impaired 100%
Class 2 - Secured
Claims of GE Capital
Corp. of P.R. $1,733,989 Impaired 100%
Class 3 - Secured
Claim of ESSROC San
Juan, Inc. $279,919 Impaired 100%
Class 4- Holders of
Gen. Unsecured
Claims $3,492,658 Impaired 5%
Class 5 - Interests N/A Unimpaired N/A
EDB's claim will be partially paid on or before the Effective Date,
by the transfer of two properties. The balance of EDB's secured
claim, for $3,246,649, will be paid over a 360 months period,
through equal monthly installments of $14,130, including principal
and interest at 3.25% per annum, until the full payment thereof.
As to Class 4, holders of allowed general unsecured claims,
excluding the claim of The Estate of Victor S. Maldonado Davila and
the claim of Ms. Bess M. Taylor Mitchell, who will not receive any
dividends, in excess of $40,000 will be paid in full satisfaction
of their claims, 5% in cash, through 60 equal consecutive monthly
installments of $2,580 commencing on the Effective Date and
continuing on the 30th day of the subsequent 59 months. Holders of
allowed general unsecured claims of $40,000 or less, will be paid
in full satisfaction of their claims 5% thereof, on the Effective
Date.
A copy of the Amended Disclosure Statement dated Oct. 19, 2015, is
available for free at:
http://bankrupt.com/misc/Mini_Master_304_Am_DS.pdf
The Debtor is represented by:
Charles A. Cuprill-Hernandez
CHARLES A. CUPRILL P.S.C. LAW OFFICES
356 Fortaleza Street, Second Floor
San Juan, PR 00901
Tel: 787-977-0515
Fax: 787-977-0518
E-mail: ccuprill@cuprill.com
About Mini Master Concrete
Mini Master Concrete Services Inc. was incorporated under the laws
of the Commonwealth of Puerto Rico in June 1972 and was primarily
engaged in the processing, production and sale of ready-mixed
concrete. Mini Master was founded by the late Eng. Victor S.
Maldonado when he learned that a competitor had established a plant
to control the quality of concrete served on site.
In May 1977, Master Aggregates Toa Baja Corporation was
incorporated under the laws of the Commonwealth of Puerto Rico. By
that time, local tax incentives were in place for the production of
sand, a scarce natural mineral in Puerto Rico. Master Aggregates
commenced operations by grinding stone to produce sand at its plan
in Toa Baja, Puerto Rico.
Mini Master Concrete Services, aka Mini Master aka Empresas Master,
and affiliate Master Aggregates sought Chapter 11 bankruptcy
protection (Bankr. D.P.R. Case Nos. 13-10302 and 13-10305) on Dec.
11, 2013, in Old San Juan, Puerto Rico. The petitions were signed
by Carmen Betancourt, president.
Master Aggregates disclosed $11,125,939 in assets and $10,148,437
in liabilities.
On Jan. 9, 2014, Mini Master and Master Aggregates filed motions
for the substantive consolidation of their Chapter 11 cases, with
Mini Master as the surviving entity, which were granted on Feb. 5,
2014. The companies were also merged at the Department of State of
Puerto Rico, effective April 1, 2014.
MISSION NEW ENERGY: Ends Quarter with A$2.5 Million in Cash
-----------------------------------------------------------
Mission New Energy Limited filed with the Securities and Exchange
Commission its quarterly report for entities admitted on the basis
of commitments.
At the beginning of the quarter, the Company had A$3.15 million in
cash. The Company reported net decrease in cash held of A$622,000.
As a result, at Sept. 30, 2015, the Company had A$2.56 million in
cash.
The Company paid A$198,000 in wages during the period.
A copy of the Quarterly Report is available for free at:
http://is.gd/3l9abk
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.
The Company reported net income of $28.4 million on $7.27 million
of total revenue for the year ended June 30, 2015, compared to a
loss of $1.1 million on $9.68 million of total revenue for the
year ended June 30, 2014.
As of June 30, 2015, Mission New Energy had $12.6 million in total
assets, $5.85 million in total liabilities and $6.76 million in
total equity.
MOSDOS OHR HATORAH: Receiver Selling Assets of Jewish School
------------------------------------------------------------
Bill T. Frazier, the appointed receiver for Mosdos Ohr Hatorah and
Congregation Mosdos Ohr Hatorah (Case No. 15-848905), filed a
motion with the court seeking authority to sell substantially all
of the entities' assets and to seek bids from qualified bidders for
some or all of the assets of the orthodox Jewish school, including
without limitation two parcels of real property located in
Cleveland Heights, Ohio, which currently house the operations of a
day school.
The bid auction was scheduled on Nov. 2, 2015, and filing of bids
expired Oct. 29, 2015.
The first property is located at 1700 South Taylor Road, Permanent
parcel numbers 684-29-012 through 016, 144 and 145. The lot is
1,381 acre is a the corner of Taylor Road and Euclid Heights
Boulevard, and is zone residential. The building, which was
constructed in 1992, is 25,451 square feet and has a masonry and
stucco exterior.
The second property is located at 1508 Warrensville Center Road,
permanent parcel numbers 683-07-017, 020 and 021. The lost is
2,193 acres with frontage of Warrensville Center Road and is zone
S-2, mixed use. The building, which is constructed in 1964, is
30,834 square feet with a masonry exterior.
The order approving bidding and sale procedures, appraisals of the
properties, and template asset purchase agreement are available on
line at http://www.raintree-capital.com,under the resources tab.
Interested parties may contact the receiver at Raintree Capital
Partners at tel: 216-227.1981 or bfrazier@raintree-capital.com
NATIONAL AMUSEMENTS: S&P Affirms 'B+' CCR; Outlook Stable
---------------------------------------------------------
Standard & Poor's Ratings Services said that it has revised its
outlook on Norwood, Mass.-based National Amusements Inc. and its
operating subsidiary NAI Entertainment Holdings LLC, which S&P
analyzes on a consolidated basis, to stable from negative.
At the same time, S&P affirmed all of its ratings on both
companies, including its 'B+' corporate credit ratings.
"The stable outlook reflects our expectation that NAIEH will
continue to be exposed to volatile box-office performance, but that
it will be able to maintain an adequate cushion of compliance under
its covenant," said Standard & Poor's credit analyst Jawad Hussain.
As of July 2, 2015, the company had a 20% EBITDA margin of
compliance with the leverage covenant on its secured credit
facility, its tightest covenant. S&P expects that domestic U.S.
box office receipts will continue to increase in the fourth quarter
of 2015 due to the anticipated success of the release schedule,
which includes highly anticipated sequels from established
franchises such as Star Wars: The Force Awakens, Spectre (part of
the James Bond franchise), and The Hunger Games: Mockingjay--Part
2. The release of these titles should also lead to an increases in
average ticket prices from increased demand for premium large
format viewing.
The stable outlook reflects S&P's expectation that National
Amusements Inc. will continue to be exposed to volatile box-office
performance, but that it will be able to maintain an adequate
cushion of compliance with its covenants and strong liquidity
because of its equity holdings in Viacom and CBS. S&P believes
that an upgrade or a downgrade is equally unlikely over the next
year
S&P could lower its rating on NAI if the company's EBITDA margin of
covenant compliance approaches 10%. This could occur if NAI's
EBITDA from theater operations declines by about 15% because of a
5% decline in attendance. This scenario further assumes that the
company's dividend income from CBS and Viacom remains flat.
An upgrade would likely require a significant improvement in NAI's
theater-level operations and EBITDA margin, as well as a shift by
the company to become less dependent on dividend income to meet its
fixed charges, which include interest expense and maintenance
capital expenditures. This would likely occur in a scenario where
NAI's adjusted leverage declined below 5x on a sustained basis as
its theater operations began to generate a significantly higher
level of EBITDA on a sustained basis.
NATURAL RESOURCE: S&P Lowers CCR to 'B'; Outlook Stable
-------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Houston-based Natural Resource Partners L.P. (NRP)
to 'B' from 'B+'. The outlook is stable.
At the same time, S&P lowered its issue-level rating on the
company's $425 million 9.125% senior unsecured notes due 2018 to
'B' from 'B+'. In addition, S&P revised the recovery rating on the
notes to '4' from '3'. The '4' recovery rating indicates S&P's
expectation of average (30% to 50%; upper half of the range)
recovery in the event of payment default.
"The stable outlook reflects our view that NRP's credit measures
will remain stable over the next 12 months," said Standard & Poor's
credit analyst Chiza Vitta. "This takes into account the
incorporation of the weakness in coal as well as oil and gas
markets, which we anticipate will result in adjusted debt leverage
above 5x."
S&P could lower the rating on NRP if S&P expected leverage to
increase above 8x, if interest coverage fell and remained below 1x,
or if liquidity fell to a level S&P viewed as less than adequate.
S&P could also lower its rating if the partnership were unable to
fund its distribution payments through distributable cash flow.
These conditions could result from weakening EBITDA as a result of
a combination of asset sales and additional weaknesses in the
retained businesses.
S&P could upgrade NRP if debt leverage were sustained below 5x.
This could result from strengthening commodity markets or debt
repayments with proceeds from successful asset sales.
NATURAL RESOURCE: S&P Lowers CCR to 'B'; Outlook Stable
-------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Houston-based Natural Resource Partners L.P. (NRP)
to 'B' from 'B+'. The outlook is stable.
At the same time, S&P lowered its issue-level rating on the
company's $425 million 9.125% senior unsecured notes due 2018 to
'B' from 'B+'. In addition, S&P revised the recovery rating on the
notes to '4' from '3'. The '4' recovery rating indicates S&P's
expectation of average (30% to 50%; upper half of the range)
recovery in the event of payment default.
"The stable outlook reflects our view that NRP's credit measures
will remain stable over the next 12 months," said Standard & Poor's
credit analyst Chiza Vitta. "This takes into account the
incorporation of the weakness in coal as well as oil and gas
markets, which we anticipate will result in adjusted debt leverage
above 5x."
S&P could lower the rating on NRP if S&P expected leverage to
increase above 8x, if interest coverage fell and remained below 1x,
or if liquidity fell to a level S&P viewed as less than adequate.
S&P could also lower its rating if the partnership were unable to
fund its distribution payments through distributable cash flow.
These conditions could result from weakening EBITDA as a result of
a combination of asset sales and additional weaknesses in the
retained businesses.
S&P could upgrade NRP if debt leverage were sustained below 5x.
This could result from strengthening commodity markets or debt
repayments with proceeds from successful asset sales.
NEEBO INC: S&P Lowers Corp. Credit Rating to 'CCC'; Outlook Neg.
----------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Lincoln, Neb.-based Neebo Inc. to 'CCC' from
'CCC+'. The outlook is negative.
At the same time, S&P lowered its issue-level rating on the
company's $100 million senior secured notes to 'CCC-' from 'CCC'.
The recovery rating on the notes remains '5', indicating S&P's
belief that lenders could expect modest recovery (10% to 30%, on
the low end of the range) in the event of payment default.
S&P estimates the company has about $150 million in reported debt
outstanding, but have not yet received any financial updates for
fiscal year 2015 (ended March 31).
The downgrade reflects the company's significant debt maturity on
June 30, 2016, S&P's estimate of unsustainable financial leverage
given weak underlying cash flows and high debt levels, and the
inability to provide financials since the sale of its retail
bookstore segment this summer to Follett.
The company has received an extension to Dec. 31, 2015, to complete
its financials for the fiscal year ended March 31, 2015. S&P
believes the bookstore segment accounted for 60%-70% of the
company's revenues and a meaningful but indeterminable portion of
the company's EBITDA. However, after the divestiture, S&P believes
the company still has about $150 million in debt, composed of
senior secured term delayed draw term loans and senior secured
notes, that mature in the first half of 2016, and leverage that is
approaching unsustainable levels without more permanent financing.
S&P believes it is possible that financial sponsor MAST Capital
could refinance the debt, since it has historically supported the
company, and we believe it is the creditor for all of the term debt
and about 75% of the notes.
S&P's negative outlook reflects Neebo's significant debt maturities
in 2016, uncertainty over future management changes, and S&P's
unfavorable view of the textbook business. S&P is unable to
forecast future cash flows due to the company's inability to
provide financials, but believe liquidity will remain weak until
the company refinances its senior secured notes.
NEVER SLIP: S&P Assigns 'B' Corp. Credit Rating; Outlook Stable
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B'
corporate credit rating to West Palm Beach, Fla.-based Never Slip
Topco Inc. The outlook is stable.
At the same time, S&P assigned a 'B' issue-level rating to the
company's senior secured revolving credit facility and senior
secured first-lien term loan. The recovery rating on the
first-lien term loan is '3' reflecting S&P's expectation of
meaningful (50% to 70%, on the low end of the range) recovery in
the event of a default.
For analytical purposes, S&P views Never Slip Topco Inc., its
subsidiary SHO Holding I Corp. (the borrower), and all operating
subsidiaries to be one economic entity, and hereinafter known as
Shoes for Crews (SFC).
S&P's ratings reflect Shoes for Crews' narrow business focus in the
slip-resistant footwear industry, small scale, and modest brand
equity. S&P believes the company has the leading market position
in slip-resistant footwear, a relatively small subsector of the
foodservice industry, and a unique payroll deduction program (PDP)
that provides a competitive advantage over other brands of
slip-resistant footwear. S&P believes relevant employers have an
incentive to participate in the company's PDP, as they receive the
benefit of a warranty plan for worker falls at essentially no cost
because the shoes are paid for by the employees via paycheck
deductions. S&P believes these programs will continue to gain
traction in other industry verticals as employers look for ways to
improve worker safety while reducing costs.
At the same time, while SFC faces very limited competition through
its corporate program offerings today, it does compete with
well-recognized brands in its direct to consumer business. Many of
these brands have stronger brand equity and are owned by larger
companies with greater scale and financial wherewithal than SFC.
S&P believes they could pose a competitive threat to SFC if they
were to implement similar PDP programs.
S&P's ratings also incorporate the company's diverse customer base,
strong retention rates, and track record of stable sales growth and
profitability. The company does not have any significant customer
concentrations and serves most of the top restaurant chains in the
U.S. While S&P views the foodservice industry as somewhat volatile
due to its sensitivity to consumer discretionary spending, it
believes the company has been able to sustain performance through
economic cycles due to a concentration in the quick-service
restaurant channel, which tends to perform better during
recessionary periods.
The stable outlook reflects S&P's expectation that SFC will
continue its trend of stable sales and profit growth and will
modestly improve credit metrics through a combination of debt
amortization and additional debt repayment with excess free cash
flow. S&P also believes liquidity will remain "adequate" given the
company's minimal capital requirements and modest debt
amortization.
NGL ENERGY: S&P Affirms 'BB-' CCR; Outlook Stable
-------------------------------------------------
Standard & Poor's Ratings Services said it affirmed its 'BB-'
corporate credit and senior unsecured debt ratings on NGL Energy
Partners L.P. The outlook is stable.
At the same time, S&P revised its recovery rating to '3' from '4'.
The '3' rating indicates that lenders can expect meaningful (50% to
70%; upper half of the range) recovery if a payment default occurs.
S&P revised the partnership's business risk profile to "fair" from
"weak" and the financial risk profile to "aggressive" from
"significant".
"The revision in the business risk profile to 'fair' reflects our
expectation of improved scale, scope, and diversity due to recent
acquisitions and successfully executed growth projects," said
Standard & Poor's credit analyst Mike Llanos.
The business risk profile assessment reflects a low percentage
(roughly 50%) of fee-based cash flow compared with peers in the
midstream sector and a lack of long-term contracts in some of its
business segments. The partnership has expanded its geographic
diversity and has a presence in multiple shale basins, although
some of the assets are relatively small where competition is stiff
and barriers to entry modest.
The financial risk profile revision to "aggressive" reflects S&P's
expectation of elevated financial leverage, adequate liquidity, and
a distribution coverage ratio of about 1.1x. S&P's base-case
forecast assumes an elevated capital spending program of about $600
million and that the crude logistics and water business segments
will account for about 50% to 55% of total margin. S&P's forecast
assumes adjusted debt to EBITDA of about 5x and EBITDA to interest
coverage in the 5x to 6x range. S&P continues to believe the
partnership will maintain a distribution coverage ratio above
1.1x.
The stable outlook on NGL Energy Partners reflects S&P's
expectation that it will successfully execute on its growth
initiatives while maintaining adequate liquidity and an adjusted
debt-to-EBITDA ratio in the 4.5x to 5x range.
ORGANIC AVENUE: Files Chapter 7 Bankruptcy, Nov. 20 Auction Set
---------------------------------------------------------------
Organic Avenue LLC filed Chapter 7 bankruptcy on October 15, 2015.
Until recently, Organic Avenue was the premiere grab-and-go
destination for organic, plant based foods and snacks in New York
City.
Jil Mazer-Marino, Esq. has been appointed as the Chapter 7 trustee
by the Office of the United States Trustee and (subject to
Bankruptcy Court approval) she has retained Keen-Summit Capital
Partners LLC to market Organic Avenue's assets for sale on a
turnkey or piecemeal basis. Organic Avenue operated ten retail
locations throughout New York City as well as a Queens-based
commissary. The company shut its doors earlier this month.
The Trustee, through Keen-Summit, is now selling Organic Avenue's
retail, commissary and warehouse leases; its intellectual property;
and its furniture, fixtures, machinery and equipment, if such FF&E
and M&E is sold as part of a turnkey sale. If the FF&E and M&E are
not sold on a turnkey basis, the Trustee is engaging a liquidator
to handle the piecemeal sale of FF&E and M&E.
According to Harold Bordwin, Keen-Summit's Principal and Managing
Director, "This offering represents an extraordinary opportunity
for a strategic buyer to quickly create or expand a market presence
in prime Manhattan locations. Moreover, Organic Avenue's I/P
represents over 14 years of brand recognition in an expanding
market."
The bid process (which is pending Bankruptcy Court approval) will
enable buyers to bid on all of the debtor's assets individually or
as a package. It is anticipated that bids will be due on
November 18, 2015, followed by an auction on November 20, 2015.
The Bidding Procedures and additional information regarding the
offering are available by contacting Keen-Summit Capital Partners
LLC at (646) 381-9222, by visiting www.keen-summit.com or by
emailing hbordwin@keensummit.com, mbordwin@keen-summit.com,
rtramantano@keen-summit.com or dgreenspan@keen-summit.com
About Keen-Summit Capital Partners LLC
Since 1982 -- for 33 years -- Keen-Summit's professionals have been
successfully executing real estate and M&A transactions for
financially challenged businesses and their creditors. With more
than 150 years of combined experience (covering more than 3 billion
square feet of real estate, constituting over $3 billion in
transactions and encompassing more than 27,000 properties), the
professionals at Keen-Summit offer their clients best-in-class
lease restructuring services, real estate disposition, M&A and
capital markets solutions.
PACIFIC RECYCLING: Files Schedules of Assets and Liabilities
------------------------------------------------------------
Pacific Recycling, Inc., filed with the U.S. Bankruptcy Court for
the District of Oregon its schedules of assets and liabilities,
disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $0
B. Personal Property $5,996,665
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $12,746,815
E. Creditors Holding
Unsecured Priority
Claims $232,031
F. Creditors Holding
Unsecured Non-Priority
Claims $8,739,568
----------- -----------
Total $5,996,665 $21,718,414
A copy of the schedules is available for free at:
http://bankrupt.com/misc/PACIFICRECYCLING_33_sal.pdf
About Pacific Recycling
Pacific Recycling, Inc. filed a Chapter 11 bankruptcy petition
(Bankr. D. Ore. Case No. 15-62925) on Aug. 27, 2015. The petition
was signed by Rodney Schultz as president. The Debtor disclosed
total assets of $5,996,665 and total liabilities of $21,718,414.
Hon. Frank R. Alley III is assigned to the case. Cable Huston LLP
represents the Debtor as counsel.
PACIFIC RECYCLING: Wants to Hire Spectrum CPA as Accountants
------------------------------------------------------------
Pacific Recycling, Inc., asks the U.S. Bankruptcy Court for the
District of Oregon for permission to employ Spectrum CPA Group,
LLP, as accountants.
Spectrum will advise the Debtor on the particulars of tax matters
associated with Chapter 11 reorganizations and to render general
accounting services to Debtor as needed throughout the course of
the Chapter 11 case, including bankruptcy and tax assistance and
advice.
Specifically, Spectrum will, among other things:
a. prepare the Debtor's state and federal income tax returns;
b. update Debtor's fixed asset schedules for any changes
occurring during the period for Debtor's monthly accounting
requirements and for preparation of required income tax returns;
c. Provide monthly support in connection with Debtor's required
reporting to the Court.
The Spectrum professionals who will be primarily responsible for
providing these services, their status and their current billing
rates are:
Ronald S. Boyd, partner $315
Paula Hickey, account manager $194
Katie Monte, account manager $170
Katie Alexander, staff accountant $110
To the best of the Committees knowledge, Spectrum does not have any
connection with Debtor, its creditors, any other
party-in-interest.
About Pacific Recycling
Pacific Recycling, Inc. filed a Chapter 11 bankruptcy petition
(Bankr. D. Ore. Case No. 15-62925) on Aug. 27, 2015. The petition
was signed by Rodney Schultz as president. The Debtor disclosed
total assets of $5,996,665 and total liabilities of $21,718,414.
Hon. Frank R. Alley III is assigned to the case. Cable Huston LLP
represents the Debtor as counsel.
PATRIOT COAL: Files Motion to Modify Retiree Benefits
-----------------------------------------------------
Patriot Coal Corporation and its affiliated debtors ask the U.S.
Bankruptcy Court for the Eastern District of Virginia, Richmond
Division, for authority to modify certain healthcare benefits for
more than 4,600 retirees.
The Debtors say that they are seeking Court authority to modify
retiree healthcare benefits because, absent an agreement with the
retiree committee, they have no other choice. The Debtors further
contend that they are simply unable to pay for healthcare benefit
obligations for the retirees.
According to the Debtors, no purchaser of the Debtors' assets is
willing to assume these obligations, and the Debtors will lose the
ability to fund their operating expenses much less any other
obligations such as retiree related expenses within a matter of
weeks. The Debtors relate that will need any cash in their estates
to fund the costs and expenses needed to emerge from chapter 11.
The Debtor tells the Court that at present, it pays for or
administers retiree healthcare benefits to approximately 4,607
retirees and 1,836 dependents, for a total of 6,433 beneficiaries.
The Debtors' proposal provides, among others:
(1) The Non-Union VEBA will receive an allowed non-priority
unsecured claim for the non-union benefits that have accrued as of
the petition date in an amount to be determined in consultation
with the Retiree Committee;
(2) Each participant of the Pre-March 1990 Plan will receive
an allowed non-priority unsecured claim for the benefits that have
accrued as of the petition date in an amount to be determined in
consultation with the Retiree Committee.
(3) For liabilities in connection with retirees of Heritage
Coal Company LLC who last worked at Squaw Creek Coal Company
("Heritage/Squaw Creek Retirees") and who are not already receiving
benefits from the Voluntary Employee Beneficiary Association trust
formed by the UMWA in the Debtors' prior bankruptcy, which assumed
the Debtors' obligations to provide retiree healthcare benefits to
certain union retirees, effective June 30, 2013 ("UMWA VEBA"), the
Debtors propose that such retiree obligations be transferred to the
UMWA VEBA. The Debtors shall cause $3,000,000 in cash to be
contributed to the UMWA VEBA on account of the Heritage/Squaw Creek
Retirees; provided that the Debtors' payment of this amount is
conditioned on the Debtors confirming a chapter 11 plan of
reorganization.
(4) On account of obligations to retirees that are not Peabody
Assumed Retirees and retirees that are not Heritage/Squaw Creek
Retirees, the Debtors shall cause the sum of one million dollars
($1,000,000) in cash to be contributed to the Retiree Committee.
The Debtors relate that they also intend to modify and clarify that
their obligations to provide retiree benefits under the Settlement
Agreement that they had executed with Peabody Energy Corporation
and its affiliates, the United Marine Workers of America ("UMWA"),
the UMWA Employees and the UMWA Retirees shall terminate, and that
Peabody's obligation to fund the VEBA Contribution, will survive
and remain in full force and effect.
The Settlement Agreement requires ongoing payment obligations by
Peabody to the Patriot Retirees Voluntary Employee Benefit
Association ("VEBA").
The Debtors tell the Court that they have been negotiating in good
faith with the Official Retiree Committee and the UMWA using
complete and reliable information as it relates to the Settlement
Agreement. The Debtors further tell the Court that an important
aspect of the Debtors' negotiations with the UMWA has been
Peabody's obligation to provide retiree benefits under the
Settlement Agreement. The Debtors contend that the UMWA's
willingness to negotiate a consensual resolution of the Debtors'
Motion is predicated on preserving Peabody's obligations under the
Settlement Agreement.
Objections to the Debtors' Motion
-- UMWA
The United Mine Workers of America ("UMWA"), which represents the
interests of more than 2,500 active and laid-off employees ("UMWA
Employees" at the Debtors' mining complexes and approximately
17,647 retirees and dependents ("UMWA Retirees"), contends that the
Debtors failed to satisfy the substantive requirements of section
1114 of the Bankruptcy Code by failing to adequately negotiate with
the UMWA in good faith necessary modifications with respect to (i)
the Peabody Remaining VEBA Payment Obligations; (ii) retiree
benefit obligations to the Squaw Creek Retirees. The UMWA further
contends that the Debtors' Motion should be denied unless the
Peabody Remaining VEBA Payment Obligations survive and there is an
appropriate treatment for the Squaw Creek Retirees.
-- Peabody Energy
Peabody Energy Corporation, on behalf of itself and Peabody Holding
Company, LLC, relates that the Debtors request authorization to
implement a section 1114 proposal that involves the Salaried
Employee Liabilities Assumption Agreement ("SELAA") - a contract
through which Peabody funds certain of the Debtors' healthcare
obligations to certain of the Debtors' retirees. Peabody further
relates that the Debtors' Proposal to the Retiree Committee
provides that, if Peabody will not make a compromise regarding its
payments under the SELAA, the Debtors will assume and assign the
SELAA to a newly-created "Salaried Employees VEBA." Peabody asserts
that this part of the Debtors' Proposal cannot be approved by the
Court since the Bankruptcy Code prevents the Debtors from assuming
or assigning the SELAA to a third party.
Patriot Coal is represented by:
Michael A. Condyles, Esq.
Peter J. Barrett, Esq.
Jeremy S. Williams, Esq.
KUTACK ROCK LLP
Bank of America Center
1111 East Main Street, Suite 800
Richmond, VA 23219-3500
Telephone: (804)644-1700
Facsimile: (804)783-6192
E-mail: Michael.Condyles@KutakRock.com
Peter.Barrett@KutakRock.com
Jeremy.Williams@KutakRock.com
- and -
Stephen E. Hessler, Esq.
Patrick Evans, Esq.
KIRKLAND & ELLIS LLP
601 Lexington Avenue
New York, NY 10022
Telephone: (212)446-4800
Facsimile: (212)446-4900
E-mail: stephen.hessler@kirkland.com
patrick.evans@kirkland.com
- and -
James H.M. Sprayregen, Esq.
Ross M. Kwasteniet, Esq.
KIRKLAND & ELLIS LLP
300 North LaSalle
Chicago, IL 60654
Telephone: (312)862-2000
Facsimile: (312)862-2200
E-mail: james.sprayregen@kirkland.com
ross.kwasteniet@kirkland.com
United Mine Workers of America is represented by:
Sharon Levine, Esq.
Paul Kizel, Esq.
Philip J. Gross, Esq.
LOWENSTEIN SANDLER LLP
65 Livingston Avenue
Roseland, New Jersey 07068
Telephone: (973)597-2500
E-mail: slevine@lowenstein.com
pkizel@lowenstein.com
- and -
Troy Savenko, Esq.
KAPLAN VOEKLER CUNNINGHAM
& FRANK, PLC
1401 East Cary Street
Richmond, VA 23219
Telephone: (804)823-4000
E-mail: tsavenko@kv-legal.com
Peabody Energy Corporation is represented by:
Bruce H. Matson, Esq.
Christopher L. Perkins, Esq.
LECLAIRRYAN, APC
919 East Main Street, 24th Floor
Richmond, VA 23219
Telephone: (804)783-7550
E-mail: bruce.matson@leclairryan.com
christopher.perkins@leclairryan.com
- and -
Heather Lennox, Esq.
JONES DAY
North Point
901 Lakeside Avenue
Cleveland, OH 44114-1190
Telephone: (216)586-7111
Facsimile: (216)579-0212
E-mail: hlennox@jonesday.com
- and -
Daniel T. Moss, Esq.
JONES DAY
51 Louisiana Avenue, N.W.
Washington, D.C. 20001-2113
Telephone: (202)879-3794
Facsimile: (202)626-1700
E-mail: dtmoss@jonesday.com
About Patriot Coal Corporation
Patriot Coal Corporation is a producer and marketer of coal in the
United States. Patriot and its subsidiaries control 1.4 billion
tons of proven and probable coal reserves -- including owned and
leased assets in the Central Appalachia basin (in West Virginia
and
Ohio) and Southern Illinois basin (in Kentucky and Illinois) and
their operations consist of eight active mining complexes in
West Virginia.
Patriot Coal first sought Chapter 11 protection on July 9, 2012,
and, on Dec. 18, 2013, won approval of its bankruptcy-exit plan
from the U.S. Bankruptcy Court for the Eastern District of
Missouri. The plan turned over most of the ownership of the
company to bondholders that include New York hedge fund Knighthead
Capital Management LLC. The linchpins of the plan were a global
settlement among the Debtors, the United Mine Workers of America,
and two third parties -- Peabody Energy Corporation and Arch Coal,
Inc. -- and a commitment by a consortium of creditors, led by
Knighthead, to backstop two rights offerings that funded the plan.
Patriot Coal Corporation and its subsidiaries commenced new
Chapter
11 cases (Bankr. E.D. Va. Lead Case No. 15-32450) in Richmond,
Virginia, on May 12, 2015. The cases are assigned to Judge Keith
L. Phillips.
Patriot Coal estimated more than $1 billion in assets and debt.
The Debtors tapped Kirkland & Ellis LLP as counsel; Kutak Rock
L.L.P., as co-counsel; Centerview Partners LLC as investment
bankers; Alvarez & Marsal North America, LLC, as restructuring
advisors; and Prime Clerk LLC, as claims and administrative agent.
The U.S. trustee overseeing the Chapter 11 case of Patriot Coal
Corp. appointed seven creditors of the company to serve on the
official committee of unsecured creditors. The Committee is
represented by Morrison & Foerster LLP as its counsel, and
Tavenner
& Beran, PLC, as its local counsel. Jefferies LLC serves as its
investment banker.
PATRIOT COAL: Retiree Committee, UMWA Agree to Benefits Changes
---------------------------------------------------------------
Patriot Coal Corporation and its affiliated debtors entered into
separate agreements with the official committee of retirees and the
United Mine Workers of America, regarding their motion seeking the
modification of certain retiree benefits, which was filed before
the U.S. Bankruptcy Court for the Eastern District of Virginia,
Richmond Division.
Agreement with the Retiree Committee
In an effort to negotiate a resolution regarding the treatment of
retirement benefits, the Debtors and the Official Retiree Committee
exchanged proposals and have reached an agreement regarding the
modification of certain of the Debtors' retiree benefit
obligations.
In the Agreed Order submitted and approved by Judge Keith L.
Phillips, the Debtors and the Retiree Committee have agreed, among
others, on the following terms:
(a) The Debtors are authorized to take all necessary action
necessary to implement their Proposal.
(b) The Debtors shall have no further obligations for retiree
benefits whatsoever, and all such obligations shall be completely
and permanently eliminated.
(c) The Debtors are released from their obligation to maintain
a balance in the Master Concentration Account that exceeds
$2,000,000.
Agreement with UMWA
The Debtors also entered into an agreement with the UMWA, with
regard to their Motion. The Debtors had filed a supplement to
their Motion which sought to clarify and confirm that their
obligation to provide retiree benefits under the Settlement
Agreement that they had executed with Peabody Energy Corporation
and its affiliates, the UMWA, UMWA Employees and UMWA Retirees,
shall terminate, but that Peabody's obligation to fund the VEBA
Contributions will survive and remain in full force and effect.
The Debtors and the UMWA have stipulated that the Settlement
Agreement is not an executory contract. The Debtors have also
exchanged proposals with the UMWA in an effort to negotiate a
resolution regarding the treatment of retiree benefits.
In the Agreed Order submitted and approved by Judge Keith L.
Phillips, the Debtors and the UMWA have agreed, among others, on
the following terms:
(a) All retirees of Heritage Coal Company, LLC, or Squaw Creek
Coal Company ("Heritage/Squaw Creek Retirees") not eligible for
benefits under the Coal Industry Retiree Health Benefit Act of
1992, and who are not already receiving benefits from the Patriot
Retirees Voluntary Employees' Beneficiary Association formed by the
UMWA in the Debtors' prior bankruptcy cases, which assumed the
Debtors' obligations to provide retiree healthcare benefits to
certain union retirees, effective June 30, 2013, will be
transferred to a VEBA to be designated by the UMWA
("Heritage/Squaw Creek Retirees VEBA"). Peabody will have the
right to review and comment on the documentation governing the
Heritage/Squaw Creek Retirees VEBA.
(b) In the event that the Debtors receive any money on account
of the Debtors' claims for the return of money related to letters
of credit or surety bonds posted in the Debtors' name with the
United Mineworkers of America 1992 Benefit Plan and/or the United
Mineworkers of America Combined Benefit Plan, the Debtors shall
either (i) pay such money to a stock trust for the benefit of
certain UMWA represented employees with the consent of Peabody,
Arch Coal Inc., any party with an interest in such money, and the
UMWA or (ii) use commercially reasonable best efforts to obtain an
order from this Court authorizing the Debtors to pay such money to
such stock trust.
(d) The Debtors will use good faith and commercially
reasonable efforts to coordinate with and cooperate with the UMWA
regarding the implications and obligations of third parties related
to the Debtor's pending motion to reject the Settlement Agreement,
including regarding Peabody's obligations to pay
$75 million on Jan. 2, 2016 and $70 million on Jan. 2, 2017, to the
2013 VEBA under the Settlement Agreement, provided that the Debtors
shall not be obligated to spend more than $1 million in fees and
expenses associated with their commercially reasonable efforts.
Patriot Coal is represented by:
Michael A. Condyles, Esq.
Peter J. Barrett, Esq.
Jeremy S. Williams, Esq.
KUTACK ROCK LLP
Bank of America Center
1111 East Main Street, Suite 800
Richmond, VA 23219-3500
Telephone: (804)644-1700
Facsimile: (804)783-6192
E-mail: Michael.Condyles@KutakRock.com
Peter.Barrett@KutakRock.com
Jeremy.Williams@KutakRock.com
- and -
Stephen E. Hessler, Esq.
Patrick Evans, Esq.
KIRKLAND & ELLIS LLP
601 Lexington Avenue
New York, NY 10022
Telephone: (212)446-4800
Facsimile: (212)446-4900
E-mail: stephen.hessler@kirkland.com
patrick.evans@kirkland.com
- and -
James H.M. Sprayregen, Esq.
Ross M. Kwasteniet, Esq.
KIRKLAND & ELLIS LLP
300 North LaSalle
Chicago, IL 60654
Telephone: (312)862-2000
Facsimile: (312)862-2200
E-mail: james.sprayregen@kirkland.com
ross.kwasteniet@kirkland.com
United Mine Workers of America is represented by:
Sharon Levine, Esq.
Paul Kizel, Esq.
Philip J. Gross, Esq.
LOWENSTEIN SANDLER LLP
65 Livingston Avenue
Roseland, New Jersey 07068
Telephone: (973)597-2500
E-mail: slevine@lowenstein.com
pkizel@lowenstein.com
- and -
Troy Savenko, Esq.
KAPLAN VOEKLER CUNNINGHAM
& FRANK, PLC
1401 East Cary Street
Richmond, VA 23219
Telephone: (804)823-4000
E-mail: tsavenko@kv-legal.com
The Retiree Committee is represented by:
Gordon S. Woodward, Esq.
SCHNADER HARRISON SEGAL & LEWIS LLP
750 9th Street, NW, Suite 550
Washington, DC 20001-4534
Telephone: (202)419-4215
E-mail: gwoodward@schnader.com
- and -
Jon D. Cohen, Esq.
STAHL COWEN CROWLEY ADDIS LLC
55 West Monroe Street, Suite 1200
Chicago, IL 60603
Telephone: (312)423-8156
E-mail: jcohen@stahlcowen.com
About Patriot Coal Corporation
Patriot Coal Corporation is a producer and marketer of coal in the
United States. Patriot and its subsidiaries control 1.4 billion
tons of proven and probable coal reserves -- including owned and
leased assets in the Central Appalachia basin (in West Virginia
and
Ohio) and Southern Illinois basin (in Kentucky and Illinois) and
their operations consist of eight active mining complexes in
West Virginia.
Patriot Coal first sought Chapter 11 protection on July 9, 2012,
and, on Dec. 18, 2013, won approval of its bankruptcy-exit plan
from the U.S. Bankruptcy Court for the Eastern District of
Missouri. The plan turned over most of the ownership of the
company to bondholders that include New York hedge fund Knighthead
Capital Management LLC. The linchpins of the plan were a global
settlement among the Debtors, the United Mine Workers of America,
and two third parties -- Peabody Energy Corporation and Arch Coal,
Inc. -- and a commitment by a consortium of creditors, led by
Knighthead, to backstop two rights offerings that funded the plan.
Patriot Coal Corporation and its subsidiaries commenced new
Chapter
11 cases (Bankr. E.D. Va. Lead Case No. 15-32450) in Richmond,
Virginia, on May 12, 2015. The cases are assigned to Judge Keith
L. Phillips.
Patriot Coal estimated more than $1 billion in assets and debt.
The Debtors tapped Kirkland & Ellis LLP as counsel; Kutak Rock
L.L.P., as co-counsel; Centerview Partners LLC as investment
bankers; Alvarez & Marsal North America, LLC, as restructuring
advisors; and Prime Clerk LLC, as claims and administrative agent.
The U.S. trustee overseeing the Chapter 11 case of Patriot Coal
Corp. appointed seven creditors of the company to serve on the
official committee of unsecured creditors. The Committee is
represented by Morrison & Foerster LLP as its counsel, and
Tavenner
& Beran, PLC, as its local counsel. Jefferies LLC serves as its
investment banker.
QUANTUM CORP: Reports Fiscal Second Quarter 2016 Results
--------------------------------------------------------
Quantum Corp. reported a net loss of $11.2 million on $117 million
of total revenue for the three months ended Sept. 30, 2015, as
compared to net income of $1.24 million on $135 million of total
revenue for the same period in 2014.
For the six months ended Sept. 30, 2015, the Company reported a net
loss of $21.98 million on $228 million of total revenue compared to
a net loss of $3.07 million on $263 million of total revenue for
the same period a year ago.
As of Sept. 30, 2015, the Company had $305.38 million in total
assets, $384 million in total liabilities and a $78.5 million total
stockholders' deficit.
"As other companies have reported, the overall market environment
in the quarter was challenging, which was most apparent in the data
protection line of our business," said Jon Gacek, president and CEO
of Quantum. "However, our data protection revenue increased
sequentially, with higher sales of both disk and tape products.
"In our scale-out storage solutions line, with backlog orders
included, we grew revenue 33 percent over the comparable quarter a
year ago. In addition, our scale-out storage run-rate revenue from
deals below $1 million - including backlog orders - grew 90 percent
in the first half of fiscal 2016 compared to the same period a year
ago, demonstrating the strength of our solutions and market
opportunity. In the second half of the year, we are focused on
further growing scale-out run-rate revenue and closing an
increasing rate of large deals to achieve our overall scale-out
storage growth target of 50 percent for the full year. While large
deals have been impacted by current market conditions and longer
sales cycles, we believe we can close more of these deals moving
forward, as we did last year.
"Another key focus for Quantum is driving non-GAAP profitability,
and we will manage our spending and investments accordingly to
achieve the right balance across our financial objectives."
A full-text copy of the press release is available for free at:
http://is.gd/ZcyGv9
About Quantum Corp.
Based in San Jose, California, Quantum Corp. (NYSE:QTM) --
http://www.quantum.com/-- is a storage company specializing in
backup, recovery and archive. Quantum provides a comprehensive,
integrated range of disk, tape, and software solutions supported
by a world-class sales and service organization.
Quantum reported net income of $16.7 million on $553 million of
total revenue for the year ended March 31, 2015, compared to a net
loss of $21.5 million on $553 million of total revenue for the year
ended March 31, 2014.
QUIRKY INC: Gets Court Approval to Auction Assets in November
-------------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that a New York
bankruptcy judge on Oct. 23, 2015, approved Quirky Inc.'s plan to
sell off its assets at a November auction, a key component of the
invention startup's Chapter 11 plan.
U.S. Bankruptcy Judge Martin Glenn approved bidding procedures for
Quirky's auction, scheduled for Nov. 3, a court official confirmed.
The assets on the auction block include Quirky's trademark, domain
name and a plethora of products it has developed, including the
Pivot Power brand power strip and Cordies brand computer cable
organizer.
About Quirky, Inc.
Headquartered in New York City, Quirky designs and develops
various products ranging from electronics, home and garden, kitchen
and organization and sells those products through big box retailers
like Target and Home Depot and online through its Web site. The
Company sold over 150 different products and a total of 4 million
units, generating over $50 million in revenue from its retail and
consulting businesses in 2014.
Quirky, Inc., Wink, Inc. and Undercurrent Acquisition, LLC filed
Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y. Lead Case No.
15-12596) on Sept. 22, 2015, with a deal to sell their assets
related to the Wink business line as a going concern to
Flextronics
International USA Inc., for $15 million, absent higher and better
offers.
The petitions were signed by Charles Kwalwasser, the chief
administrative officer.
Judge Martin Glenn is assigned to the jointly administered cases.
Quirky estimated assets in the range of $10 million to $50 million
and liabilities of at least $50 million.
The Debtors have engaged Cooley LLP as counsel, Klestadt Winters
Jureller Southard & Stevens LLP as conflicts counsel, Centerview
Partners LLC as investment bankers, FTI Consulting, Inc., as
financial advisors, Rust Consulting/Omni Bankruptcy as claims and
noticing agent and Hilco IP Services LLC dba Hilco Streambank as
intellectual property disposition consultant to Quirky, Inc.
U.S. Trustee for Region 2, has appointed five members to serve in
the
Official Committee of Unsecured Creditors.
RAIL LOGISTICS: WA Federal Judge Says Execs No Standing to Sue
--------------------------------------------------------------
Daniel Langhorne at Bankruptcy Law360 reported that a Washington
federal judge tossed a $41 million lawsuit against BNSF on Oct. 23,
2015, saying two former executives of a defunct refrigerated rail
car company who accused the railroad giant of putting it out of
business with delayed deliveries didn't have standing to sue.
U.S. District Judge Thomas O. Rice held on Oct. 23, that Steven
Lawson, the sole shareholder of Rail Logistics LC, which operated
the Cold Train produce-shipping service, and Michael S. Lerner, the
company's former CEO, lacked standing to sue for personal injury.
RANCHO ARROYO: Case Summary & 7 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Rancho Arroyo Grande LLC
A California Limited Liability Corporation
217-G Stearns Wharf
Santa Barbara, CA 93101
Case No.: 15-12171
Chapter 11 Petition Date: October 30, 2015
Court: United States Bankruptcy Court
Central District of California (Santa Barbara)
Judge: Hon. Peter Carroll
Debtor's Counsel: Karen L Grant, Esq.
THE LAW OFFICES OF KAREN L. GRANT
924 Anacapa St Ste 1M
Santa Barbara, CA 93101
Tel: 805-962-4413
Fax: 805-568-1641
Email: kgrant@silcom.com
Total Assets: $18.33 million
Total Liabilities: $14.64 million
The petition was signed by Christopher J. Conway, managing member.
List of Debtor's Seven Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
All Seasons Landscaping $768
Delta Liquid Energy $60
Department of Motor Vehicles $559
Padre Associates, Inc. $680
Ruffoni Farming & Management LLC $10,630
Sean Addison Pool and Spa Inc. $400
Wells Fargo Bank, N.A. Swap $1,185,500
21680 Gateway Center Drive #160 Modification
Diamond Bar, CA 91765 Agreement
RANCHO ARROYO: Files Schedules of Assets and Liabilities
--------------------------------------------------------
Rancho Arroyo Grande LLC filed with the Bankruptcy Court its
schedules of assets and liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $18,000,000
B. Personal Property $333,875
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $13,450,467
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-priority
Claims $1,198,597
----------- -----------
TOTAL $18,333,875 $14,649,064
About Rancho Arroyo
Rancho Arroyo Grande LLC filed Chapter 11 bankruptcy petition
(Bankr. C.D. Cal. Case No. 15-12171) on Oct. 30, 2015. The
petition was signed by Christopher J. Conway as managing member.
The Debtor has engaged The Law Offices of Karen L. Grant as
counsel. Judge Peter Carroll is assigned to the case.
RELATIVITY MEDIA: Claims Firm Reneged $30M TV Sale Funding
----------------------------------------------------------
Jonathan Randles at Bankruptcy Law360 reported that Relativity
Media on Oct. 26, 2015, accused investment management firm VII
Peaks Capital of balking on its commitment to provide $30 million
to help fund the sale of Relativity's reality television production
business, ramping up a lawsuit the entertainment company filed
earlier this month in New York bankruptcy court.
In a statement, Relativity said VII Peaks has attempted to shift
its own failure to perform under an underlying contract onto the
company's CEO, Ryan Kavanaugh, and investors. The spat is related
to the $125 million sale.
About Relativity
Relativity -- http://relativitymedia.com/-- is a next-generation
global media company engaged in multiple aspects of content
production and distribution, including movies, television, sports,
digital and music. More than just a collection of
entertainment-related businesses, Relativity is a content engine
with the ability to leverage each of these business units,
independently and together, to create content across all mediums,
giving consumers what they want, when they want it.
Relativity Studios, the Company's largest division, has produced,
distributed or structured financing for more than 200 motion
pictures, generating more than $17 billion in worldwide box-office
revenue and earning 60 Oscar nominations. Relativity's films
include Oculus, Safe Haven, Act of Valor, Immortals, Limitless,
and The Fighter.
Relativity Media LLC and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code on July 30, 2015 (Bankr.
S.D.N.Y., Case No. 15-11989). The case is assigned to Judge
Michael E. Wiles.
The Debtors are represented by Craig A. Wolfe, Esq., Malani J.
Cademartori, Esq., and Blanka K. Wolfe, Esq., at Sheppard Mullin
Richter & Hampton LLP, in New York; and Richard L. Wynne, Esq.,
Bennett L. Spiegel, Esq., and Lori Sinanyan, Esq., at Jones Day,
in New York.
Brian Kushner of FTI Consulting, Inc., serves as chief
restructuring officer and crisis and turnaround manager. Luke
Schaeffer of FTI Consulting, Inc., serves as deputy CRO.
Blackstone Advisory Partners L.P. serves as the Debtors'
investment banker. The team is led by Timothy Coleman, Senior
Managing Director, CJ Brown, Senior Managing Director, Paul
Sheaffer, Vice President, and Joseph Goldschmid, Associate.
The Debtors' noticing and claims agent is Donlin, Recano &
Company, Inc.
RELATIVITY MEDIA: Holthouse Carlin Okayed as Tax Advisor
--------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized Relativity Fashion, LLC, et al., to employ Holthouse
Carlin & Van Trigt LLP as tax advisor nunc pro tunc to the Petition
Date.
Holthouse will perform these tax advisory services, if and to the
extent requested:
(a) tax return preparation and compliance services for entities
for which it has provided such services in the past pursuant to the
engagement letter dated Aug. 8, 2015, and for entities for which it
will be performing such services for the first time for 2014
pursuant to the Engagement Letter dated Aug. 13, 2015;
(b) assist with analyzing the tax impact and tax basis of assets
anticipated to be sold pursuant the Engagement Letter dated Aug.
13, 2015, and the multistate non-income tax impact of the
anticipated asset sale including, without limitation, sales & use
tax, transfer tax and gross receipt tax, pursuant to the engagement
letter dated Aug. 14, 2015; and
(c) assist with analyzing the tax impact of converting Relativity
Holdings LLC to a C Corporation and the impact to its members
pursuant to the engagement letter dated Aug. 8, 2015.
In a supporting declaration, Vicken Haleblian, a partner of
Holthouse, told the Court that the hourly rates of Holthouse are:
Professional Range
------------ -----
Partner $450 - $650
Principal $400 - $460
Senior Manager $280 - $390
Manager $230 - $270
Senior $180 - $220
Staff $130 - $170
As of the Petition Date, Holthouse held prepetition claims against
the Debtors in the aggregate amount of $298,517, but agreed to
waive the claims as a result of the engagement.
About Relativity Fashion
Based in New York, Relativity Fashion LLC dba M3 Relativity --
http://relativitymedia.com/-- is a privately-held entertainment
company with an integrated and diversified global media platform
that provides, among other things, film and television financing,
production and distribution. Relativity was founded in 2004 by
Ryan Kavanaugh as a films late cofinancier partnering with major
studios such as Sony and Universal. In addition, the Company
engages in content production and distribution, including movies,
television, fashion, sports, digital and music.
The Company and its affiliates filed for Chapter 11 protection on
July 30, 2015 (Bankr. S.D.N.Y. Lead case No. 15-11989). Judge
Michael E. Wiles presides over the Debtors' Chapter 11 cases.
Craig A. Wolfe, Esq., Malani J. Cademartori, Esq., and Blanka K.
Wolfe, Esq., at Sheppard Mullin Richter & Hampton LLP, and Richard
L. Wynne, Esq., Bennett L. Spiegel, Esq., and Lori Sinanyan, Esq.,
at Jones Day, represent the Debtors in the bankruptcy cases.
The Debtors reported total assets of $559.9 million, and total
debts: $1.1 billion as of Dec. 31, 2014.
On August 7, 2015, the U.S. Trustee for Region 2 appointed seven
creditors to serve on the Debtors' official committee of unsecured
creditors. The creditors are Allied Advertising Limited
Partnership, Carat USA Inc., Cinedigm Corp., Comen VFX LLC, Create
Advertising Group LLC, NBC Universal, and Technicolor Inc. Togut,
Segal & Segal LLP represents the Committee.
RELATIVITY MEDIA: Kasowitz Benson Approved as Conflicts Counsel
---------------------------------------------------------------
The Hon. Michael E. Wiles of the U.S. Bankruptcy Court for th
Southern District of New York authorized Relativity Fashion, LLC,
et al., to employ Kasowitz, Benson, Torres & Friedman LLP as
special litigation and conflicts counsel nunc pro tunc to Aug. 7,
2015.
KBT&F is expected to, among other things:
a) advise the Debtors regarding the Armored Car Loan and the DR
Loan and all matters related thereto;
b) advise the Debtors regarding the adverse actions taken by
UniFi Completion Agreement Insurance Solutions, Inc. against Debtor
Armored Car Productions, LLC and Debtor DR Productions, LLC and
certain of their film assets; and
c) take all necessary actions to investigate, negotiate and, if
necessary, litigate to protect the Debtors interests as they relate
to the OneWest Matters and the UniFi Matters.
The services performed by KBT&F will not be duplicative of services
performed for the Debtors by their general counsel in the cases
because of the existence of conflicts of interest. KBT&F and the
Debtors' general bankruptcy counsel will coordinate their efforts
and clearly delineate their respective duties.
In a supporting declaration of Andrew K. Glenn, KBT&F's standard
hourly rates charged to bankruptcy and non-bankruptcy clients are:
Partners $565 - $1,250
Special Counsel $590 - $1,250
Associates $290 - $700
Staff Attorneys $290 - $500
Paralegals $220 - $345
KBT&F has agreed to discount its standard billing rates, as set
forth above, by 10% in connection with the retention matters.
To the best of the Debtors' knowledge, KBT&F does not represent or
hold any interest adverse to the Debtors or to their estates with
respect to the retention matters.
The firm can be reached at:
Andrew K. Glenn, Esq.
Matthew B. Stein, Esq.
KASOWITZ, BENSON, TORRES & FRIEDMAN LLP
1633 Broadway
New York, NY 10019
Tel: (212) 506-1700
Fax: (212) 506-1800
E-mails: AGlenn@kasowitz.com
MStein@kasowitz.com
About Relativity Fashion
Based in New York, Relativity Fashion LLC dba M3 Relativity --
http://relativitymedia.com/-- is a privately-held entertainment
company with an integrated and diversified global media platform
that provides, among other things, film and television financing,
production and distribution. Relativity was founded in 2004 by
Ryan Kavanaugh as a films late cofinancier partnering with major
studios such as Sony and Universal. In addition, the Company
engages in content production and distribution, including movies,
television, fashion, sports, digital and music.
The Company and its affiliates filed for Chapter 11 protection on
July 30, 2015 (Bankr. S.D.N.Y. Lead case No. 15-11989). Judge
Michael E. Wiles presides over the Debtors' Chapter 11 cases.
Craig A. Wolfe, Esq., Malani J. Cademartori, Esq., and Blanka K.
Wolfe, Esq., at Sheppard Mullin Richter & Hampton LLP, and Richard
L. Wynne, Esq., Bennett L. Spiegel, Esq., and Lori Sinanyan, Esq.,
at Jones Day, represent the Debtors in the bankruptcy cases.
The Debtors reported total assets of $559.9 million, and total
debts: $1.1 billion as of Dec. 31, 2014.
On August 7, 2015, the U.S. Trustee for Region 2 appointed seven
creditors to serve on the Debtors' official committee of unsecured
creditors. The creditors are Allied Advertising Limited
Partnership, Carat USA Inc., Cinedigm Corp., Comen VFX LLC, Create
Advertising Group LLC, NBC Universal, and Technicolor Inc. Togut,
Segal & Segal LLP represents the Committee.
RELATIVITY MEDIA: McGladrey Okayed to Provide Tax Advisory
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized Relativity Fashion, LLC, et al., to employ McGladrey LLP
to provide certain tax advisory services nunc pro tunc to Sept. 17,
2015.
McGladrey will provide certain tax advisory services, including:
(a) provide various tax planning and tax structuring consulting
services including, without limitation, the tax effect of the
various transactions the Debtors may enter into in connection with
asset sales;
(b) analyze the tax consequences to the Debtors, LLC members and
other stakeholders, as well as examine potential tax attributes, in
connection with a potential wind-up of the Debtors' businesses;
and
(c) analyze the tax consequences of a "check-the-box" election
for converting Relativity Holdings, LLC to a C Corporation and the
potential impact of such election on its members.
McGladrey's estimated fees for the Tax Advisory Services is
$225,000 until Oct. 31, 2015, provided, however, that McGladrey
will promptly inform the Debtors if it believes estimated fees will
exceed $225,000, and in no event will McGladrey's fees for the Tax
Advisory Services exceed $275,000.
In addition, McGladrey will provide the Debtors with a fee progress
report prior to McGladrey incurring $100,000 or more in fees.
McGladrey will receive advance payment representing 50% of
estimated fees upon completion of the following service
milestones:
1. McGladrey to provide a summary of initial tax conclusions
related to the potential sale of assets.
2. McGladrey to provide a summary of initial conclusions on a
"check-the-box" election for converting Relativity Holdings, LLC to
a C Corporation.
3. McGladrey to provide a summary of initial conclusions on
multistate non-income tax consequences, if any, faced by the
Debtors.
McGladrey's fees, including estimated fees, for the Tax Advisory
Services are based on these hourly rates:
Professional Standard Discounted
------------- -------- -----------
Partner $750 $700
Senior Manager $650 $615
Manager $525 $500
Staff $225 $210
To the best of the Debtors' knowledge, McGladrey is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
About Relativity Fashion
Based in New York, Relativity Fashion LLC dba M3 Relativity --
http://relativitymedia.com/-- is a privately-held entertainment
company with an integrated and diversified global media platform
that provides, among other things, film and television financing,
production and distribution. Relativity was founded in 2004 by
Ryan Kavanaugh as a films late cofinancier partnering with major
studios such as Sony and Universal. In addition, the Company
engages in content production and distribution, including movies,
television, fashion, sports, digital and music.
The Company and its affiliates filed for Chapter 11 protection on
July 30, 2015 (Bankr. S.D.N.Y. Lead case No. 15-11989). Judge
Michael E. Wiles presides over the Debtors' Chapter 11 cases.
Craig A. Wolfe, Esq., Malani J. Cademartori, Esq., and Blanka K.
Wolfe, Esq., at Sheppard Mullin Richter & Hampton LLP, and Richard
L. Wynne, Esq., Bennett L. Spiegel, Esq., and Lori Sinanyan, Esq.,
at Jones Day, represent the Debtors in the bankruptcy cases.
The Debtors reported total assets of $559.9 million, and total
debts: $1.1 billion as of Dec. 31, 2014.
On August 7, 2015, the U.S. Trustee for Region 2 appointed seven
creditors to serve on the Debtors' official committee of unsecured
creditors. The creditors are Allied Advertising Limited
Partnership, Carat USA Inc., Cinedigm Corp., Comen VFX LLC, Create
Advertising Group LLC, NBC Universal, and Technicolor Inc. Togut,
Segal & Segal LLP represents the Committee.
RENFRO CORP: S&P Affirms 'B' CCR & Revises Outlook to Negative
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its 'B'
corporate credit rating on North Carolina-based Renfro Corp. and
revised the rating outlook to negative from stable.
In addition, S&P affirmed its 'B' issue-level rating on Renfro's
$220 million term loan B due 2019. The recovery rating is '4',
indicating S&P's expectation of average (30% to 50%, lower end of
the range) recovery for debtholders in the event of payment
default.
The outlook revision reflects Renfro's tight covenant cushion in
coming quarters and the apparel manufacturer's sustained high
financial leverage. S&P's revised forecast, which takes into
account sluggish top-line growth and negative currency effects,
indicates there is downside risk that credit metrics will not
improve enough over the next year to maintain an adequate covenant
cushion and to support the rating.
The outlook is negative. S&P could consider a downgrade if
liquidity becomes constrained, in particular if Renfro's covenant
cushion decreases and does not improve in the coming quarters,
and/or the covenant is breached and the company is not able to cure
it. In addition, S&P could downgrade the company if operating
performance materially deteriorates, possibility due to the loss of
a major customer or ongoing margin erosion, causing leverage to
remain near 7x for an extended period.
For S&P to revise the outlook to stable, Renfro's covenant cushion
would need to improve so that S&P forecasts it can maintain above
10% cushion over the forecast period, factoring in a gradual
tightening of covenant limits. In addition, Renfro needs to make
significant progress towards improving financial leverage to well
below 6x in 2016, and progress to mid-5x in 2017.
REPUBLIC RESOURCES: Case Summary & 20 Top Unsecured Creditors
-------------------------------------------------------------
Debtor: Republic Resources, LLC
3303 Oakwell Court, Suite 220
San Antonio, TX 78218
Case No.: 15-52637
Chapter 11 Petition Date: October 31, 2015
Court: United States Bankruptcy Court
Western District of Texas (San Antonio)
Judge: Hon. Craig A. Gargotta
Debtor's Counsel: William B. Kingman, Esq.
LAW OFFICES OF WILLIAM B. KINGMAN, P.C.
4040 Broadway, Suite 450
San Antonio, TX 78209
Tel: (210) 829-1199
Email: bkingman@kingmanlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by John V. York, president/managing
member.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/txwb15-52637.pdf
REVEL AC: Nightclub Operator Wins in Appeal from Sale Order
-----------------------------------------------------------
The United States Court of Appeals for the Third Circuit ordered a
stay of the order authorizing the sale of Revel AC, Inc.'s assets
that allows Revel to sell its casino free and clear of the lease of
IDEA Boardwalk, LLC.
Revel opened a 47-story, 710-foot-high resort-casino in Atlantic
City, New Jersey. The Casino was marketed as "a state of the art
gaming and resort facility unlike any other in Atlantic City." Its
cost: $2.4 billion, making it the most expensive hotel ever built
in Atlantic City. As part of its plan for the Casino, Revel
entered into a lease with IDEA to run two upscale nightclubs and a
beach club. The lease was for a 10-year term (with a 15-year
option to extend) and obligated IDEA to contribute $16 million of
the $80 million projected cost of construction of the clubs.
Unfortunately the Casino's $2.4 billion price tag was no indication
of its future success.
A sluggish Atlantic City economy and the Casino's inability to turn
a profit were too much for Revel to overcome. After a failed sale
attempt, Revel's cash flow problems made a second trip to
bankruptcy the only option. It filed a so-called "Chapter 22" on
June 19, 2014. As part of its first-day filings, Revel asked the
Bankruptcy Court for permission to sell its assets free and clear
of all liens and interests, which includes leases, and to approve
bid procedures to allow that sale as quickly as possible. The
Court approved the request and set August 7, 2014 as the auction
date.
IDEA appealed that order and moved to stay the Court's decision
pending appeal, noting the risk that, if the decision were not
stayed, its appeal would be moot once the sale closed. The
Bankruptcy Court denied IDEA's request. IDEA then filed an
emergency motion before the District Court to stay the Bankruptcy
Court's sale order. The District Court denied IDEA's Stay Request
hence the appeal to the Third Circuit.
The Third Circuit held that "The factors favoring a stay weigh
solidly with IDEA. First, that it would prevail on the merits was
all but assured because nothing in the record casts doubt on the
validity of its lease with Revel, thus prohibiting the latter from
invoking Section 363(f) and selling its assets free of IDEA's
lease. Second, IDEA demonstrated that, absent a stay, it would
lose its club business at the Casino, and this was sufficient to
show irreparable harm. On the balancing of harms, perhaps Revel
could have tilted the balance in its favor with its own showing of
irreparable harm, but it didn't come close, as it relied only on
its counsel's hollow representations of harm rather than record
evidence. Thus, while the public interest appears to favor a stay
denial, that alone doesn't tip the four-factor balance in Revel's
favor. We thus reverse and stay only the part of the Sale Order
that allows Revel to sell the Casino free and clear of IDEA's
lease.
The case is captioned In re: REVEL AC, INC., ET AL., Debtors. IDEA
BOARDWALK, LLC, Appellant, NO. 15-1253(3d Cir.).
A full-text of the Opinion dated September 30, 2015 is available at
http://is.gd/SbtZbcfrom Leagle.com.
Appellant, IDEA Boardwalk LLC is represented by:
Jeffrey A. Cooper, Esq.
Jonathan I. Rabinowitz, Esq.
Barry J. Roy, Esq.
RABINOWITZ, LUBETKIN & TULLY
293 Eisenhower Parkway
Suite 100, Livingston, NJ 07039
Phone: (973) 597-9100
Fax: (973) 597-9119
Appellees/Debtors are represented by Michael Viscount, Jr., Esq. --
mviscount@foxrothschild.com --- FOX ROTHSCHILD, John H. Strock,
Esq. --jstrock@foxrothschild.com -- FOX ROTHSCHILD,Jason N. Zakia,
Esq. --, John K. Cunningham, Esq. -- jcunningham@whitecase.com --
WHITE & CASE, Stuart J. Moskovitz, Esq. --, 819 Highway 33,
Freehold, NJ 07728, Richard W. Riley, Esq. –-
RWRiley@duanemorris.com -- DUANE MORRIS, 222 Delaware Avenue, Suite
1600, Wilmington, DE 19801, Sommer L. Ross, Esq. –-
SLRoss@duanemorris.com -- DUANE MORRIS, 30 South 17th Street,
United Plaza, Philadelphia, PA 19103.
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 of Revel AC LLC and its debtor-affiliates are transferred
to Judge Michael B. Kaplan. The Debtors' cases was originally
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, Inc., et al., on April 20, 2015, filed an amended plan of
reorganization and accompanying disclosure statement to incorporate
the terms of a settlement and plan support agreement entered into
with the Official Committee of Unsecured Creditors, and Wells Fargo
Bank, N.A., as DIP Agent, and Wells Fargo Principal Lending, LLC,
as a Prepetition First Lien Lender and DIP Lender.
The Settlement Agreement, among other things, provides that Wells
Fargo agrees to give the general unsecured creditors $1.60 million
of its recovery from the proceeds of the sale of substantially all
of the Debtors' assets to Polo North Country Club, Inc., and to
advance $150,000 from its recovery to fund the Debtors'
reconciliation of claims and prosecution of claims or estate causes
of actions.
Early in April 2015, U.S. Bankruptcy Judge Gloria Burns approved an
$82 million sale of the Revel Casino Hotel to Polo North Country
Club, Inc., which is owned by Florida developer Glenn Straub,
ending nearly 10 months of contentious legal combat for control of
the Atlantic City, N.J., resort.
RIVER-BLUFF: Seeks to Obtain $5.37-Mil. Secured Credit From STCU
----------------------------------------------------------------
River-Bluff Enterprises, Inc., asks the U.S. Bankruptcy Court for
the Eastern District of Washington, to authorize it to obtain new
secured credit from Spokane Teachers Credit Union ("STCU") in the
amount of approximately $5.37 million plus U.S. Bank's
post-confirmation attorney fees.
The Debtor notes that the amount of the new loan will be secured by
the Debtor's real property located at 100 E. Jackson St.,
Ellensburg, WA ("Medical Building").
The Debtor tells the Court that pursuant to its Plan, it was
required to, among other things, obtain leases for unrented space
in the Medical Building, make monthly payments to U.S. Bank in the
amount of $39,000 per month commencing in January 2015, with the
payments increasing to $41,000 per month in January 2016 for the
remaining term of the loan. The Debtor further tells the Court
that the loan must be paid in full by Dec. 31, 2018. The Debtor
asserts that it is in compliance with all the terms of the Plan
generally, and with all of the terms of the Plan applicable to the
secured claim of U.S. Bank. The Debtor contends that the new debt
incurred from STCU will be used first to retire the secured claim
of U.S. Bank in its entirety. Debtor anticipates that the terms of
the new loan shall be more favorable to the Debtor, in that the
term of the loan is expected to go beyond Dec. 31, 2018, and that
the payments terms will improve the Debtor's cash flow position.
U.S. Bank's Response to Motion
U.S. Bank, National Association ("U.S. Bank") relates that it has
no objection to the entry of an order authorizing the Debtor to
obtain new credit from STCU provided that the credit is used to
fully retire U.S. Bank's secured claim against the Medical
Building.
River-Bluff Enterprises is represented by:
Metiner G. Kimel, Esq.
KIMEL LAW OFFICES
1115 West Lincoln Avenue, Suite 105
Yakima, WA 98902
Telephone: (509) 452-1115
Facsimile: (509) 452-1116
U.S. Bank is represented by:
Teresa H. Pearson, Esq.
John R. Knapp, Jr., Esq.
MILLER NASH GRAHAM & DUNN LLP
111 S.W. Fifth Avenue, Suite 3400
Portland, Oregon 97204
Telephone: (503) 224-5858
Facsimile: (503) 224-0155
E-mail: teresa.pearson@millernash.com
john.knapp@millernash.com
About River-Bluff Enterprises
Ellensburg, Washington-based River-Bluff Enterprises, Inc., filed a
Chapter 11 bankruptcy petition (Bankr. E.D. Wash. Case No.
14-00843) on March 11, 2014. In its schedules, the Debtor
disclosed $10.2 million in total assets and $17.6 million in total
liabilities.
This is River-Bluff's second bankruptcy filing in less than two
years. It previously sought bankruptcy protection (Bankr. E.D.
Cal. Case No. 12-92017) in Modesto, California, in July 2012. The
case was dismissed in 2013.
Gary W. Dryer, Assistant U.S. Trustee for Region 18, informed the
U.S. Bankruptcy Court for the Eastern District of Washington that
due to the lack of entities eligible to serve on the unsecured
creditors' committee, the U.S. Trustee is not appointing an
unsecured creditors' committee in the Chapter 11 case of
River-Bluff Enterprises, Inc.
ROTONDO WEIRICH: Eisner Amper Approved as Financial Advisors
------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Pennsylvania
authorized Rotondo Weirich Enterprises, Inc., et al., to employ
Eisner Amper, LLP, as financial advisors.
EisnerAmper is expected to, among other things:
(a) assess the Debtors' cash flow requirements including the
preparation and maintenance of short-term cash flow
projections and reporting, as required;
(b) develop, prepare and present operating plans and financial
projections, as agreed upon; and
(c) prepare reports and communications with the Debtors'
creditor constituencies, as required.
EisnerAmper will be paid at these hourly rates:
Managing Directors $435-$540
Senior Consultants $260-$430
Consultants and Staff $185-$250
On the petition date, Executive Sounding Board Associates, LLC
(ESBA) received a retainer in the amount of $10,302 from the
Debtors. The retainer was funded by Mario Rotondo who is principal
of the Debtors. The estimated balance of that retainer as of Aug.
31, 2015 is $4,520 which sum is being transferred by ESBA to
EisnerAmper.
On Aug. 31, 2015, the Debtors filed an application to employ ESBA
as financial advisors. On Sept. 1, 2015, the members of ESBA
including Mr. DuFrayne, and certain employees were employed by
EisnerAmper. In connection to the employment of ESBA's members and
certain employees, certain professional services contracts and
liabilities associated with those contracts were transferred from
ESBA to EA.
Michael DuFrayne, former managing director of ESBA will continue to
lead the engagement for EisenAmper along with other EisenAmper
professionals as needed. Mr. DuFrayne's standard billing rate is
$525 per hour; but for the engagement, his rate will be discounted
to $495 per hour.
EisnerAmper will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Mr. DuFrayne assured the Court that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code and does not represent any interest adverse to the Debtors and
their estates.
Arles B. Greene, president of ABG Caulking Contractors has objected
to the Debtor's application to employ EisnerAmper LLP as financial
advisors, nunc pro tunc to Sept. 1, 2015. Mr. Green related that
it does not want any form of relief granted to the Debtor. Mr.
noted that the Debtor failed to pay its obligations to the Company
on certain projects. Aris J. Karalis, Esq., at Maschmeyer Karalis
P.C., represented
Mr. Green.
The Court ordered that the order authorizing the Debtor to employ
Executive Sounding Board Associates, LLC as its financial advisor
is vacated as of Sept. 1, 2015.
About Rotondo Weirich
Rotondo Weirich Enterprises, Inc. and five of its affiliates sought
Chapter protection (Bankr. E.D. Pa. Case Nos. 15-16146 - 15-16151)
on Aug. 27, 2015. The petition was signed by Steven J. Weirich as
president & CEO. The Debtors disclosed total assets of $8,667,885
and total liabilities of $10,452,860. Maschmeyer Karalis P.C.
represents the Debtors.
SAMSON RESOURCES: Final Cash Collateral Hearing Moved to Nov. 17
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
continued to Nov. 17, 2015, at 11:00 a.m. the hearing to consider
final approval of Samson Resources Corp.'s motion to use cash
collateral.
The Debtors on Sept. 17 filed a motion to use cash collateral of
JPMorgan Chase Bank N.A. and Deutsche Bank Trust Company Americas
to fund its operations. JPMorgan and Deutsche Bank serve as
administrative agents for the first lien lenders and second lien
lenders, respectively. The lenders have agreed to the Debtors' use
of cash collateral until January 2016, the date by which the
Debtors expect to confirm and consummate the plan. As part of the
consensual arrangement, the Debtors have agreed to provide the
first lien and the second lien secured parties with an adequate
protection package that includes replacement liens, superpriority
administrative claims, certain payments, and budget and reporting
requirements.
On Sept. 25, the Court entered an interim order authorizing the
Debtor to use cash collateral.
The Court scheduled a final hearing on the motion for Oct. 14, but
continued the hearing to Oct. 29, and then to Nov. 17.
The Court set an Oct. 22 deadline for objections. The Debtors
received informal comments from the Office of the United States
Trustee and the Official Committee of Unsecured Creditors. The
Court agreed to extend the deadline for the U.S. Trustee and the
Committee to file formal responses by Nov. 10 at 4:00 p.m.
Non-Cash Prepetition Collateral
The prepetition agents, namely JPMorgan and Deutsche Bank, filed a
joinder in support of the Debtors' motion to use cash collateral.
The Prepetition Agents pointed out that following the hearing on
the first day motions, the Debtors, the Prepetition Agents and
counsel for an ad hoc group of prepetition noteholders (the "Ad Hoc
Group") negotiated a revised form of interim order that was entered
by the Court on Sept. 25, 2015. The Interim Cash Collateral Order
provides that for purposes of the interim period it covers, the
Prepetition Agents and Prepetition Secured Parties are entitled to
adequate protection of their interests in the Cash Collateral, "in
an amount equal to the aggregate postpetition diminution in value
of the applicable Prepetition Agent's or Prepetition Secured
Party's interest in the Cash Collateral from and after the Petition
Date." The Interim Cash Collateral Order reserves for
consideration at the Final Hearing the Debtors' request to provide
the Prepetition Agents and the other Prepetition Secured Parties
with adequate protection of their interests in Prepetition
Collateral that is not Cash Collateral (the "Non-Cash Prepetition
Collateral") and whether, for purposes of the Court's consideration
of this issue, any postpetition diminution in value of such
interests in the Non-Cash Prepetition Collateral should be measured
from the Petition Date. The Prepetition Agents submit that the
Cash Collateral Motion constitutes a procedurally proper request
pursuant to, inter alia, sections 361, 363(c)(2) and 363(e) of the
Bankruptcy Code and Bankruptcy Rules 4001(a), 4001(b) and 4001(d),
to condition the use of the Prepetition Collateral on the provision
of adequate protection to the Prepetition Agents and the other
Prepetition Secured Parties of their interests in all Prepetition
Collateral.
JPMorgan is represented by:
FOX ROTHSCHILD LLP
Jeffrey M. Schlerf, Esq.
L. John Bird, Esq.
Citizens Bank Center
919 North Market Street, Suite 300
Wilmington, DE 19801
Telephone: (302) 654-7444
Facsimile: (302) 656-8920
- and -
Sean T. Scott, Esq.
MAYER BROWN LLP
71 S. Wacker Drive
Chicago, IL 60606
Telephone: (312) 782-0600
Facsimile: (312) 701-7711
E-mail: stscott@mayerbrown.com
- and -
Charles S. Kelley, Esq.
MAYER BROWN LLP
700 Louisiana St., Ste. 3400
Houston, TX 77002-2730
Telephone: (713) 238-3000
Facsimile: (713) 238-4888
E-mail: ckelley@mayerbrown.com
Deutsche Bank is represented by:
RICHARDS, LAYTON & FINGER, P.A.
John H. Knight, Esq.
Joseph C. Barsalona II, Esq.
One Rodney Square, 920 North King Street
Wilmington, Delaware 19801
Telephone: (302) 651-7700
Facsimile: (302) 651-7701
- and -
Margot B. Schonholtz, Esq.
Ana M. Alfonso, Esq.
WILLKIE FARR & GALLAGHER LLP
787 Seventh Avenue
New York, New York 10019
Telephone: (212) 728-8000
Facsimile: (212) 728-8111
About Samson Resources
Samson Resources Corporation is an onshore oil and gas exploration
and production company with interests in various oil and gas leases
primarily located in Colorado, Louisiana, North Dakota, Oklahoma,
Texas, and Wyoming. The Operating Companies operate, or have
royalty or working interests in, approximately 8,700 oil and gas
production sites.
Samson was acquired by KKR and Crestview from Charles Schusterman
in December 2011 for approximately $7.2 billion. The investor
group provided approximately $4.1 billion in equity investments as
part of the purchase price.
Samson Resources Corporation, et al., filed Chapter 11 bankruptcy
petitions (D. Del. Lead Case No. 15-11934) on Sept. 16, 2015.
Philip W. Cook, the executive vice president and chief financial
officer, signed the petitions. Samson estimated assets and
liabilities of more than $1 billion.
The Debtors tapped Kirkland & Ellis LLP as general counsel, and
Klehr Harrison Harvey Branzburg LLP is the Debtors' local counsel.
Alvarez & Marsal LLC acts as the Debtors' financial advisor.
Blackstone Advisory Partners L.P. serves as the Debtors' investment
banker. Garden City Group, LLC, serves as claims and noticing
agent to the Debtors.
The Official Committee of Unsecured Creditors tapped Farnan LLP and
White & Case LLP as attorneys.
SEANERGY MARITIME: Jelco Delta Reports 88.5% Stake as of Sept. 11
-----------------------------------------------------------------
Jelco Delta Holding Corp. reported the acquisition of 19,449,900
shares of common stock of Seanergy Maritime Holdings Corp. on Sept.
11, 2015, 13,278,700 shares of Common Stock on Sept. 29, 2015, and
17,382,600 shares of Common Stock on Oct. 21, 2015, at a price of
$0.18 per share, pursuant to a Share Purchase Agreement entered
into between the Issuer and Jelco dated Sept. 7, 2015.
As of Oct. 29, 2015, Jelco Delta beneficially owned 139,357,256
common shares of Seanergy Maritime representing 88.5 percent of the
shares outstanding.
Comet Shipholding Inc. also reported beneficial ownership of
4,267,173 common shares of Seanergy Maritime as of Oct. 29, 2015.
Claudia Restis disclosed that she beneficially owned 147,895,822
shares of common stock of Seanergy Maritime, representing 94
percent of the shares outstanding. Ms. Restis is the beneficial
owner of 100% of the capital stock of each of Jelco Delta Holding
Corp. and Comet Shipholding Inc. through a revocable trust of which
she is beneficiary.
A copy of the regulatory filing is available for free at:
http://is.gd/qVgyjs
About Seanergy
Athens, Greece-based Seanergy Maritime Holdings Corp. is an
international company providing worldwide seaborne transportation
of dry bulk commodities. The Company owns and operates a fleet
of seven dry bulk vessels that consists of three Handysize, two
Supramax and two Panamax vessels. Its fleet carries a variety of
dry bulk commodities, including coal, iron ore, and grains, as
well as bauxite, phosphate, fertilizer and steel products.
Ernst & Young (Hellas) Certified Auditors-Accountants S.A., in
Athens, Greece, issued a "going concern" qualification on the
consolidated financial statements for the year ended Dec. 31, 2014,
citing that following the disposal of the Company's entire fleet in
early 2014 in the context of its restructuring plan, the Company
was unable to generate sufficient cash flow to meet its obligations
and sustain its continuing operations that raise substantial doubt
about the Company's ability to continue as a going concern.
The Company disclosed net income of $80.3 million on $2.01 million
of net vessel revenue for the year ended Dec. 31, 2014, compared
with net income of $10.9 million on $23.1 million of net vessel
revenue for the year ended Dec. 31, 2013.
As of June 30, 2015, the Company had $19.6 million in total
assets, $10.2 million in total liabilities, and $9.42 million in
stockholders' equity.
SECURUS HOLDINGS: S&P Affirms 'B' CCR; Outlook Negative
-------------------------------------------------------
Standard & Poor's Ratings Services said that it has affirmed all
ratings, including its 'B' corporate credit rating, on Dallas-based
inmate telecommunications provider Securus Holdings Inc. S&P
removed all ratings from CreditWatch where it placed them with
negative implications on Oct. 8, 2015. The outlook is negative.
"The affirmation and negative outlook reflects our uncertainty
regarding the company's operating performance over the next few
years," said Standard & Poor's credit analyst Rose Askinazi.
The risks S&P identified in its research update published Oct. 8,
2015, when it placed the company's ratings on CreditWatch remain,
including the FCC's vote to cap rates for inmate calling services,
without reducing or eliminating facility commission payments.
"We believe the forthcoming FCC order, if implemented, could
materially hurt the company's profitability and push leverage above
our 6.5x downgrade threshold on a sustained basis," said
Ms. Askinazi.
The negative outlook reflects S&P's uncertainty regarding the
company's operating performance over the next few years. This
stems from the FCC's vote to cap rates on inmate calling services,
without reducing or eliminating facility commission payments. S&P
believes the forthcoming FCC order, if implemented, could
materially hurt the company's profitability and push leverage above
our 6.5x downgrade threshold on a sustained basis.
S&P could lower the rating if it believes the company is not on a
credible path to materially offset the negative impact of the rate
caps over the next 12 months, pushing leverage above 6.5x on a
sustained basis. More specifically, if S&P believes the company
has not made material progress in renegotiating its contracts to
reduce existing commission payments and growing its ancillary
service offerings over the next 12 months, S&P could lower ratings.
S&P could revise the outlook to stable if it believes the company
has a credible plan to materially offset the negative impact of the
rate caps, likely through the aforementioned actions. More
specifically, S&P could revise the outlook to stable if it believes
the company can sustain leverage below 6.5x over the next 12 months
while maintaining "adequate" liquidity.
STACKPOLE INT'L: S&P Raises CCR to 'BBB-' After JEH Deal Closed
---------------------------------------------------------------
Standard & Poor's Ratings Services said it raised its long-term
corporate credit rating on the Stackpole International group of
companies (collectively, Stackpole), to 'BBB-' from 'B+' following
the announcement that Johnson Electric Holdings Ltd. closed its
acquisition of Stackpole on Oct. 28, 2015. At the same time,
Standard & Poor's removed all of the Stackpole ratings from
CreditWatch, where they had been placed with positive implications
Aug. 11.
S&P subsequently withdrew its ratings on Stackpole at the company's
request.
"We raised our ratings on Stackpole to reflect the redemption of
the company's existing debt and resulting significant improvement
in its financial risk profile, as well as its acquisition by
Johnson and our assessment of Stackpole as a 'moderately strategic'
subsidiary as defined under our group rating methodology," said
Standard & Poor's credit analyst Jamie Koutsoukis.
S&P expects Johnson to provide support for Stackpole, as reflected
in Johnson's repayment of Stackpole's external debt on close of the
acquisition, and for Stackpole to become a wholly owned subsidiary
of the Hong Kong-based company.
The rating reflected S&P's anchor of 'bb+' for Stackpole, based on
S&P's "weak" business risk and "minimal" financial risk profile
assessments for the company. The "minimal" financial risk profile
reflects the lack of debt at Stackpole following the redemption of
its senior secured notes. S&P assess all rating modifiers as
neutral to the rating. S&P's assessment that Stackpole is
"moderately strategic" to its new parent, Johnson (BBB/Stable/--),
results in a one-notch positive impact to S&P's stand-alone credit
profile on Stackpole, which resulted in the 'BBB-' corporate credit
rating.
TECHPRECISION CORP: Former Xchanging Exec. Tom Sammons Is New CFO
-----------------------------------------------------------------
In connection with the resignation of Richard Fitzgerald as chief
financial officer of TechPrecision Corporation, the Company
appointed Thomas Sammons, who joined the Company in March 2015, as
vice president, finance, of the Company's wholly owned subsidiary,
Ranor, Inc., to succeed Mr. Fitzgerald as chief financial officer
of the Company effective on Oct. 23, 2015. In his capacity as
chief financial officer, Mr. Sammons will serve as the Company's
principal financial officer and principal accounting officer.
Mr. Sammons, 60, has served as vice president, finance, of Ranor,
Inc. since March 9, 2015. Prior to joining the Company, Mr.
Sammons served as the financial controller of Xchanging Services,
Inc., an international provider of technology-enabled business
processing, technology and procurement services, from February 2012
through February 2015 and as international controller and business
unit controller at Ryerson, Inc., a metals distribution and
processing company, from May 2005 through January 2012. Mr.
Sammons holds certifications as a Certified Management Accountant
and a Certified Financial Manager and received his B.S. in Business
Administration from SUNY, Empire State College and an M.B.A. from
Cornell University.
About TechPrecision
TechPrecision Corporation (OTC BB: TPCSE), through its wholly owned
subsidiaries, Ranor, Inc., and Wuxi Critical Mechanical Components
Co., Ltd., globally manufactures large-scale, metal fabricated and
machined precision components and equipment.
TechPrecision reported a net loss of $3.58 million for the year
ended March 31, 2015, compared to a net loss of $7.09 million for
the year ended March 31, 2014.
As of June 30, 2015, the Company had $10.97 million in total
assets, $10.46 million in total liabilities and $509,261 in total
stockholders' equity.
Marcum LLP, in Bala Cynwyd, Pennsylvania, issued a "going concern"
qualification on the consolidated financial statements for the year
ended March 31, 2015, citing that the Company has suffered
recurring losses from operations, and the Company's liquidity may
not be sufficient to meet its debt service requirements as they
come due over the next twelve months. These circumstances raise
substantial doubt about the Company's ability to continue as a
going concern.
TERRESTAR CORP: Former Shareholder's Suit Denied as Moot
--------------------------------------------------------
Terrestar Corporation filed a motion to dismiss the second amended
complaint of Aldo Ismael Perez, which sought to revoke the
Bankruptcy Court's order confirming the Debtors' plan of
reorganization on the basis that the order was procured by fraud.
The Defendants argue, among other things, that the Complaint is
equitably moot.
The Plaintiff is a former common shareholder of the TSC Debtors and
owned 220,000 shares of TSC's common stock as of February 16, 2011.
On June 27, 2012, TSC filed its third amended joint chapter 11 plan
of reorganization to which the Plaintiff filed multiple objections.
The Court overruled Perez's objections, along with several other
pro se objections, and confirmed the TSC Debtors' Plan.
On April 22, 2013, the Plaintiff filed this adversary proceeding
seeking to revoke the Confirmation Order. By leave of the Court, he
filed the second amended complaint in May 2014. In that Complaint,
Plaintiff again alleges that TSC violated a duty to disclose
certain facts in the Plan and Disclosure Statement and seeks
revocation of the Confirmation Order. In their motion to dismiss,
the TSC Debtors argue that the Plaintiff's complaint is equitably
moot, that Plaintiff is collaterally estopped from raising
allegations that have already been addressed in earlier
proceedings, and that Plaintiff has failed to adequately plead that
the Confirmation Plan was procured by fraud.
Judge Sean H. Lane of the United States Bankruptcy Court for the
Southern District of New York granted the Defendants' Motion to
Dismiss the Plaintiff's Second Amended Complaint under the doctrine
of equitable mootness and for failure to meet the standard for
revocation of the Confirmation Order.
The adversary proceeding is ALDO ISMAEL PEREZ, Plaintiff, v.
TERRESTAR CORPORATION, et al., Defendants, ADV. PROC. NO. 13-01334
(SHL)(Bankr. S.D.N.Y.).
The bankruptcy case is In re: TERRESTAR CORPORATION, et al.,
Chapter 11, Debtors, CASE NO. 11-10612 (SHL)(Bankr. S.D.N.Y.).
A full-text of the Decision dated September 29, 2015 is available
at http://is.gd/crGJQdfrom Leagle.com.
Aldo Ismael Perez, Plaintiff, represented by:
Juan C. Zorrilla, Esq.
FOWLER WHITE BURNETT, P.A.
Espirito Santo Plaza
1395 Brickell Avenue, 14th Floor
Miami, Florida 33131
Email:jzorrilla@fowler-white.com
TerreStar Corporation, et al., Defendant, represented by:
Ira S. Dizengoff, Esq. –
AKIN, GUMP, STRAUSS, HAUER & FELD, LLP
One Bryant Park
Bank of America Tower
New York, NY 10036-6745
Phone: +1 212.872.1000
Fax: +1 212.872.1002
Email:idizengoff@akingump.com
About TerreStar Corp.
TerreStar Corporation and TerreStar Holdings, Inc., filed
voluntary Chapter 11 petitions with the U.S. Bankruptcy Court for
the Southern District of New York on Feb. 16, 2011.
TSC's Chapter 11 filing joins the bankruptcy proceedings of
TerreStar Networks Inc. and 12 other affiliates, which filed on
Oct. 19, 2010. The October Chapter 11 cases are procedurally
consolidated under TSN's Case No. 10-15446 under Judge Sean H.
Lane.
TSC is the parent company of each of the October Debtors. TSC has
four wholly owned direct subsidiaries: TerreStar Holdings, Inc.,
TerreStar New York Inc., Motient Holdings Inc., and MVH Holdings
Inc.
TSC's case is jointly administered with the cases of seven of the
October Debtors under the caption In re TerreStar Corporation, et
al., Case No. 11-10612 (SHL). The seven Debtor entities who
sought joint administration with TSC are TerreStar New York Inc.,
Motient Communications Inc., Motient Holdings Inc., Motient
License Inc., Motient Services Inc., Motient Ventures Holdings
Inc., and MVH Holdings Inc.
TSC is a Delaware corporation whose main asset is the equity in
non-Debtor TerreStar 1.4 Holdings LLC, which has the right to use
a "1.4 GHz terrestrial spectrum" pursuant to 64 licenses issued by
the Federal Communication Commission. TSC also has an indirect
89.3% ownership interest in TerreStar Network, Inc., which
operates a separate and distinct mobile communications business.
TerreStar Holdings is a Delaware corporation that directly holds
100% of the interests in 1.4 Holdings LLC.
TerreStar Networks -- TSN -- the principal operating entity of
TSC, developed an innovative wireless communications system to
provide mobile coverage throughout the United States and Canada
using satellite-terrestrial smartphones. The system, however,
required an enormous amount of capital expenditures and initially
produced very little in the way of revenue. TSN's available cash
and borrowing capacity were insufficient to cover its funding;
thus, forcing TSN to seek bankruptcy protection in October 2010.
TSC estimated assets and debts of $100 million to $500 million in
its Chapter 11 petition.
Ira S. Dizengoff, Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP,
in New York, serves as counsel for the TSC and TSN Debtors.
Garden City Group is the claims and notice agent. Blackstone
Advisory Partners LP is the financial advisor. The Garden City
Group, Inc., is the claims and noticing agent in the Chapter 11
cases.
Otterbourg Steindler Houston & Rosen P.C. is the counsel to the
Official Committee of Unsecured Creditors formed in TSN's Chapter
11 cases. FTI Consulting, Inc., is the Committee's financial
advisor.
TerreStar Networks sold its business to Dish Network Corp. for
$1.38 billion. It canceled a June 2011 auction because there were
no competing bids submitted by the deadline.
TerreStar Networks previously filed a reorganization plan that
called for secured noteholders to swap more than $850 million in
debt for nearly all the equity in reorganized TerreStar. Junior
creditors, however, would see little recovery under that plan
while existing equity holders would be wiped out. TerreStar
Networks scrapped that plan in 2011 in favor of the auction.
In November 2011, TerreStar Networks filed a liquidating
Chapter 11 plan after striking a settlement with creditors. The
creditors' committee initiated lawsuits in July to enhance the
recovery by unsecured creditors.
Judge Lane approved on Feb. 14, 2012, TerreStar Networks Inc.'s
Chapter 11 plan to divvy up the proceeds from the sale to Dish
Network.
TOMS SHOES: S&P Lowers CCR to 'B-'; Outlook Stable
--------------------------------------------------
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Los Angeles-based TOMS Shoes LLC to 'B-' from 'B'.
The outlook is stable.
At the same time, S&P lowered its issue-level rating on TOMS' $300
million senior secured bank loan due 2020 to 'B-' from 'B'. The
recovery rating is '3', indicating S&P's expectation of meaningful
(50% to 70%, lower end of the range) recovery for debtholders in
the event of payment default.
The downgrade reflects S&P's expectation that TOMS' operating
performance will continue to lag below its previous expectations,
resulting in significantly elevated credit measures in 2015 and
2016. S&P expects the company's fully adjusted debt-to-EBITDA
ratio to be a weak 10x and funds from operations (FFO)-to-debt to
be below 5% under S&P's base-case scenario for 2015, improving
gradually to about 8x and 6%, respectively, in 2016. The weak
operational and financial performance is due to decreasing
revenues, escalating cost of sales, negative currency effects, and
operational problems, which are the principal factors contributing
to the weakened profitability metrics and elevated financial
leverage.
The stable outlook reflects S&P's expectations that the new
management is capable of implementing actions to regain topline
growth and restore operating margins over the two years. This
should allow the company to gradually reduce financial leverage,
both by strengthening EBITDA and allocating free cash flows to debt
amortization. S&P expects TOMS to demonstrate significant progress
toward reducing financial leverage in the coming years, so that its
adjusted debt-to-EBITDA ratio reduces to about 8x in 2016, and to
below 7x in 2017.
TROPICANA ENTERTAINMENT: Plan Contribution Claims Granted Priority
------------------------------------------------------------------
Wimar Tahoe Corporation, f/k/a Tropicana Casino and Resorts, Inc.
and Columbia Sussex Corporation filed two motions for summary
judgment seeking allowance and payment of administrative expenses
or, in the alternative, for management services and personnel
provided to certain Debtors under various service agreements.
Columbia seeks allowance and payment of prepetition priority claims
or, in the alternative, for providing an insured health program and
401(k) program under various service agreements for the 180 days
preceding the petition date. Columbia also seeks allowance and
payment of administrative expense claims or, in the alternative,
for services rendered postpetition.
Judge Kevin J. Carey of the United States Bankruptcy Court for the
District of Delaware denied Wimar's Motion for Summary Judgment and
granted in part Columbia's Motion for Summary Judgment, to allow
priority status under the Bankruptcy Code for contributions to
employee benefit plans made within 180 days preceding the Petition
Date, and denied, in part, regarding Columbia's request for payment
of the priority claims until it is determined whether the claim
amount exceeds the limitations under the code. Columbia's Motion
for Summary Judgment for allowance and payment of claims based upon
Bankruptcy Code is also denied.
The case is captioned In re: TROPICANA ENTERTAINMENT, LLC, et al.
Chapter 11, CASE NO. 08-10856 (KJC)(Bankr. D.Del.).
A full text of the Memorandum dated October 14, 2015 is available
at http://is.gd/wJoptNfrom Leagle.com.
Tropicana Entertainment, LLC, Debtor, represented by John J.
Amberg, Kirkland & Ellis, LLP, Wendy L. Bloom, Esq. --
wendy.bloom@kirkland.com -- Kirkland & Ellis, LLP, Robert S. Brady,
Esq. -- rbrady@ycst.com -- Young, Conaway, Stargatt & Taylor, LLP,
Marc Jason Carmel, Paul Hastings LLP, Mark D. Collins, Esq. --
mfcollins@rlf.com -- Richards, Layton & Finger, P.A., Scott D.
Cousins, Esq. SCousins@bayardlaw.com -- Bayard, P.A., David H.
DeCelles, Esq. -- david.decelles@kirkland.com -- Kirkland & Ellis
LLP, Daniel J. DeFranceschi, defranceschi@rlf.com -- Richards
Layton & Finger, Seth A. Gastwirth, Esq. --
seth.gastwirth@kirkland.com -- Kirkland & Ellis LLP, L. Katherine
Good, Esq. -- kgood@wtplaw.com -- Whiteford Taylor & Preston LLC,
Paul N. Heath, heath@rlf.com -- Richards Layton & Finger, Cory D.
Kandestin, Esq. -- kandestin@rlf.com -- Richards, Layton & Finger,
P.A., Lee E. Kaufman, Esq. -- kaufman@rlf.com -- Richards, Layton &
Finger, P.A., Scott Kitei, Esq. -- scott.kitei@kirkland.com --
Kirkland & Ellis LLP, Jason M. Madron, Esq. -- madron@rlf.com
--vRichards, Layton & Finger, P.A., Travis A. McRoberts, Esq. --
tmcroberts@akingump.com -- Akin Gump Strauss Hauer & Feld LLP, Kyle
J. Ortiz, Esq. -- Paul Hastings LLP, Michael W. Romanczuk, Esq. --
romanczuk@rlf.com -- Richards, Layton & Finger, P.A., Zachary I
Shapiro, Esq. -- shapiro@rlf.com -- Richards, Layton & Finger,
P.A., David J. Zott, Esq. -- david.zott@kirkland.com -- Kirkland &
Ellis, LLP.
About Tropicana Entertainment
Tropicana Entertainment Inc. owned and operated nine casinos and
resorts in Indiana, Louisiana, Mississippi, Nevada and New Jersey.
The Company owns approximately 6,000 rooms, 9,000 slot positions
and 250 table games. In addition, the Company owns a development
property in Aruba. The company is based in Las Vegas, Nevada.
Tropicana Entertainment LLC and certain affiliates filed for
Chapter 11 protection (Bankr. D. Del. Case No. 08-10856) on May 5,
2008. Kirkland & Ellis LLP and Mark D. Collins, Esq., at Richards
Layton & Finger, represent the Debtors in their restructuring
efforts. Their financial advisor is Lazard Ltd. Their notice,
claims, and balloting agent is Kurtzman Carson Consultants LLC.
Epiq Bankruptcy Solutions LLC is the Debtors' Web site
administration agent. AlixPartners LLP is the Debtors'
restructuring advisor. Stroock & Stroock & Lavan LLP and Morris
Nichols Arsht & Tunnell LLP represent the Official Committee of
Unsecured Creditors in this case. Capstone Advisory Group LLC is
financial advisor to the Creditors' Committee.
The OpCo Debtors, a group of Tropicana entities owning casinos and
resorts in Atlantic City, New Jersey and Evansville, Indiana
obtained confirmation from the Bankruptcy Court of a
reorganization plan. On April 29, 2009, non-debtor units of the
OpCo Debtors, designated as the New Jersey Debtors -- Adamar of
New Jersey, Inc., and its affiliate, Manchester Mall, Inc. --
filed for Chapter 11 (Bankr. D.N.J. Lead Case No. 09- 20711) to
effectuate a sale of the Atlantic City Resort and Casino to a
group of Investors-led by Carl Icahn. Judge Judith H. Wizmur
presides over the cases. Manchester Mall is a wholly owned
subsidiary of Adamar that owns and operates certain real property
utilized in the New Jersey Debtors' business operations.
Effective March 2010, Tropicana Entertainment successfully emerged
from the Chapter 11 reorganization process as an Carl Icahn-owned
entity.
A group of Tropicana entities, known as the LandCo Debtors, which
own Tropicana casino property in Las Vegas, have obtained approval
of a separate Chapter 11 plan.
Ilana Volkov, Esq., and Michael D. Sirota, Esq., at Cole, Schotz,
Meisel, Forman & Leonard, in Hackensack, New Jersey, represented
the New Jersey Debtors. Kurtzman Carson Consultants LLC acts as
their claims and notice agent. Adamar disclosed $500 million to
$1 billion both in total assets and debts in its petition.
Manchester Mall disclosed $1 million to $10 million in total
assets, and less than $50,000 in total debts in its petition.
Debtors Adamar of New Jersey Inc. and Manchester Mall Inc. have
merged into Adamar of NJ In Liquidation, LLC. The merger and name
change is in accordance with an Amended and Restated Purchase
Agreement, which governs the sale and transfer of the operations
of the Tropicana Casino and Resort - Atlantic City, including
substantially all of the New Jersey Debtors' assets, to Tropicana
Entertainment Inc., Tropicana Atlantic City Corp., and Tropicana
AC Sub Corp., free and clear of any and all liens, claims and
encumbrances.
UNIVITA HOLDINGS: Tiger Capital to Auction Assets on Nov. 11
------------------------------------------------------------
Tiger Capital Group's Remarketing Services Division has been
retained by the Chapter 7 bankruptcy trustee and Univita Holdings,
LLC to auction assets formerly owned by the Miramar-based
integrated home care service and regional medical supply company,
which operated 13 facilities in Florida, Tennessee and Georgia.
The sale will include durable medical equipment (DME) inventory,
in-home DME, a fleet of 90 vehicles, warehouse distribution systems
and equipment, intellectual property, IT/Network equipment,
facility leases, and other assets.
Integrated Home Care Investors Inc., a Florida corporation, has
submitted a $2.5 million stalking horse bid for a substantial
portion of the assets. Tiger will be accepting competing bids for
the asset package covered under the stalking horse offer, as well
as for all of the company's assets or smaller portions in a
telephonic auction scheduled for 11:00 a.m. (ET) on November 11.
Those intending to bid during the auction are required to submit
bids to qualify by 5:00 p.m. (ET)
November 9. The bid package is available at www.soldtiger.com
Previews of the various assets being offered will be held November
2 through November 6 at the company's nine locations in Florida,
including Miramar East and West, Jupiter, Daytona Beach,
Jacksonville, Ft. Meyers, Tampa (two), and Orlando; three locations
in Tennessee: Nashville (two) and Kingsport; and Atlanta, Ga.
"This auction represents a unique opportunity for multiple
healthcare industry entities -- including medical home care
providers, pharmacies, infusion services, visiting nurse
organizations, rental service companies, and wholesalers -- to
acquire turnkey operations or to expand their existing business
with DME-specific inventories and assets," said John Coelho, senior
vice-president of Tiger Remarketing Services.
He added that an online auction for any remaining assets will
commence November 13 at www.SoldTiger.com and will close in rapid
succession, live auction style, on November 19, beginning at 10:30
a.m. (ET).
Univita's facilities range in size from 2,000 square feet to
104,000 square feet.
Key DME assets available for sale include manual and power
wheelchairs and scooters, oxygen systems, portable generators,
patient lifts, patient beds, walkers/canes, nebulizers, CPAP's,
Bipap's, ventilation systems, and more. Supplies and consumables
include masks, hoses, connectors, and more. The DME and
consumables being sold include assets housed at the company's
facilities, as well as in-home DME items located within patient
homes in the three states.
Other major assets being auctioned include an oxygen refilling
station in Orlando and a like-new data center in Miramar West ($5
million cost in 2014), including equipment from Cisco, Dell,
NetApp, F5 Big IP, and others.
Intellectual property being offered includes all Univita URL's and
trade names established by the company, as well as various domain
names.
"In addition to the DME community, this sale offers a large variety
of assets for businesses of all types, including vehicles,
warehouse equipment, and office equipment and furnishings," noted
Mr. Coelho.
The 90-vehicle fleet includes Isuzu diesel box trucks, vans, pickup
trucks, and cars—as new as 2012.
Warehouse and plant support equipment includes forklifts, electric
and hydraulic pallet jacks, pallet racking, utility shelving,
ladders, 160-kw and 360-kw standby generators, and much more.
Office assets include executive, reception, conference and
breakroom furniture; panel systems; computers and servers;
printers; copiers, VOIP phones; and much more.
For a full catalog of the items offered, locations for previews of
individual items, and details on how to schedule a site visit and
bid, go to: www.SoldTiger.com or contact John Coelho at
jcoelho@tigergroup.com
Univita, which was the sole authorizer of home services for many
Medicaid plan members in Florida, filed for Chapter 7 bankruptcy on
August 28, 2015 in the Delaware Bankruptcy Court (case number
15-11788).
VALEANT PHARMACEUTICALS: S&P Lowers CCR to 'B+'; Outlook Negative
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Valeant Pharmaceuticals International Inc. to 'B+' from
'BB-'. The rating outlook is negative.
At the same time, S&P lowered its rating on the senior secured debt
to 'BB' from 'BB+', and lowered its rating on the senior unsecured
debt to 'B-' from 'B'.
S&P's recovery rating of '1' on the secured debt and '6' on the
unsecured debt remain unchanged.
"Given the multitude of legal, regulatory, and reputational issues
that Valeant faces, we are revising our assessment of management
and governance to 'weak' from 'fair,' which is the primary driver
of the ratings downgrade," said Standard & Poor's credit analyst
David Kaplan.
Valeant severed ties with its affiliate, specialty pharmacy network
Philidor RX Services, after leading pharmacy benefit managers
(PBMs) terminated their relationships with Philidor, citing
noncompliance with the terms of their agreements. S&P views the
abrupt nature of this separation as likely to exacerbate the loss
of revenues and profits S&P already anticipated from the reduced
viability of that channel.
While this channel represents only a modest amount of Valeant's
revenues (6.8% of its third-quarter revenues), S&P believes these
developments further harm Valeant's already tarnished reputation.
S&P believes this could compromise the company's ability to
effectively market its products to doctors through its sales force.
S&P also believes these developments further increase potential
legal, regulatory, and reputational risks to the company.
Moreover, based on the aggressive tactics being used at Philidor,
and assertions of wrongdoing, S&P estimates that a large proportion
of those revenues may immediately evaporate as those prescriptions
are transitioned to an alternative channel. S&P also believes that
Philidor meaningfully contributed to Valeant's growth rates on a
year-to-date basis.
Given S&P's expectation that Valeant's marketing efforts to doctors
will likely encounter headwinds, its loss of Philidor as an engine
of growth, and the company's subsequent pledge to restrain price
increases to less than 10% per year following regulatory scrutiny,
S&P believes that the company's ability to grow organically will be
constrained going forward.
S&P's negative rating outlook reflects risks stemming from the
multitude of potential reputational, legal, and regulatory
headwinds the company is facing, despite the company's ability to
absorb substantial downside at the current rating. S&P believes
the company will likely maintain its strong cash flow generation
despite potential revenue declines, which provides adequate
liquidity to address potential litigation or fines.
S&P could lower its rating if it believes reputational, legal, or
regulatory developments are likely to imperil the company's ability
to generate good levels of cash flow, which could indicate more
serious issues surrounding the quality of the businesses. This
would likely involve significant regulatory actions or further
disclosures regarding unfavorable activity, governance, or internal
controls.
S&P could revise the outlook to stable if it gains more confidence
that investigations and reputational headwinds are contained and
unlikely to jeopardize Valeant's business. Under this scenario,
S&P would expect to have greater confidence that the company would
maintain adjusted debt leverage of about 5x.
WESTERN DENTAL: S&P Lowers CCR to 'CCC+' then Withdraws Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on dental management company Western Dental Services Inc. to
'CCC+' from 'B'. The outlook is negative. Western Dental is a
subsidiary of Premier Dental Services Inc. (CCC+/Negative/--).
S&P subsequently withdrew its 'CCC+' rating on Western Dental.
S&P lowered the rating on Western Dental to match the rating on
parent Premier Dental. S&P then withdrew the rating on Western
Dental because the rating on Premier Dental reflects the credit
quality of the combined entity.
WESTMORELAND COAL: Announces Executive Appointments
---------------------------------------------------
Westmoreland Coal Company announced that Keith E. Alessi intends to
retire as chief executive officer of the Company, effective as of
Dec. 31, 2015. Mr. Alessi will continue to serve as chief
executive officer emeritus following his retirement.
On Oct. 23, 2015, in connection with Mr. Alessi's retirement, the
Board of Directors of the Company appointed Kevin A. Paprzycki, age
45, to serve as the Company's chief executive officer, effective
Jan. 1, 2016. The Board also appointed John A. Schadan, age 50, to
serve as president and chief operating officer of the Company, and
Jason Veenstra, age 37, to serve as chief financial officer of the
Company, each effective as of Jan. 1, 2016.
Mr. Veenstra joined the Company in April 2014 as CFO - Canada.
Prior to joining the Company, Mr. Veenstra held various roles at
Sherritt International from 2006 until 2014, including serving as
Director of Business Development and Chief Financial Officer for
the coal division. Mr. Veenstra received a Bachelor of Commerce
degree in Accounting from the University of Alberta and articled at
Ernst & Young LLP to complete his Chartered Accountant
designation.
Messrs. Paprzycki, Schadan and Veenstra will continue to receive
salary and benefits, and remain eligible to participate in the
Company's long-term incentive program and its annual incentive
program, each of which is described in further detail in the 2015
Proxy Statement.
About Westmoreland Coal
Colorado Springs, Colo.-based Westmoreland Coal Company (NYSE
AMEX: WLB) -- http://www.westmoreland.com/-- is the oldest
independent coal company in the United States. The Company's coal
operations include coal mining in the Powder River Basin in
Montana and lignite mining operations in Montana, North Dakota and
Texas. Its power operations include ownership of the two-unit
ROVA coal-fired power plant in North Carolina.
Westmoreland Coal Company reported a net loss applicable to common
shareholders of $173 million in 2014, a net loss applicable to
common shareholders of $6.05 million in 2013 and a net loss
applicable to common shareholders of $8.58 million in 2012.
As of June 30, 2015, the Company had $1.7 billion in total assets,
$2.2 billion in total liabilities and a $423 million total
deficit.
* * *
As reported by the TCR on Nov. 20, 2014, Standard & Poor's Rating
Services raised its corporate credit rating on Westmoreland Coal
Co. one-notch to 'B' from 'B-'. "The stable outlook is supported
by Westmoreland's committed sales position over the next year,
which should result in stable cash flows," said Standard & Poor's
credit analyst Chiza Vitta.
Moody's upgraded the corporate family rating (CFR) of Westmoreland
Coal Company to 'B3' from 'Caa1', and assigned 'Caa1' rating to the
company's proposed new $300 million First Lien Term Loan, the TCR
reported on Nov. 20, 2014. The upgrade of the CFR reflects the
company's successful integration of the Canadian mines acquired in
April 2014, and Moody's expectation that the company's Debt/ EBITDA
will track at around 5x in 2015 and 2016 and that the company will
be break-even to modestly free cash flow positive over the same
time period.
WESTMORELAND COAL: Reports Third Quarter 2015 Results
-----------------------------------------------------
Westmoreland Coal Company reported a net loss applicable to common
shareholders of $46.6 million on $350 million of revenues for the
three months ended Sept. 30, 2015, compared to a net loss
applicable to common shareholders of $49.3 million on $338 million
of revenues for the same period a year ago.
For the nine months ended Sept. 30, 2015, the Company reported a
net loss applicable to common shareholders of $94.9 million on
$1.07 billion of revenues compared to a net loss applicable to
common shareholders of $132 million on $806 million of revenues for
the same period during the prior year.
"The quarter was a steady one despite very mild weather and
customer outages," said CEO Keith E. Alessi. "Strength in our
historical US Coal operations offset weakness in our Ohio
operations."
"As we now have greater visibility, we are updating our guidance
for the year. Since issuing original guidance, we have seen
numerous impacts on EBITDA and changes in capital spending. We
still anticipate the free cash flow we generate for 2015 will
service cash interest and additionally retire approximately $44
million in debt, or $2.45 per share. This falls within the range
of outcomes of our previous guidance for EBITDA and capital. While
our core business remains solid, we have experienced a prolonged
plant outage at the largest customer of the MLP and Buckingham. The
customer expected to be fully operational in the third quarter but
continuing operational problems have delayed returning to full
capacity until mid-November. The cumulative EBITDA impact of this
outage in 2015 is $15.0 million versus our original guidance.
Additionally, the high level of M&A activity conducted during the
third quarter resulted in approximately $5.0 million in incremental
professional services fees. We have adjusted our EBITDA guidance
by $20.0 million to reflect these two items and we narrowed the
range. We have also reduced our projected capital expenditures for
the year due to lower tons sold and outstanding management of
capital projects."
"During the quarter, we completed diligence on several potential
acquisitions which we chose not to pursue because they did not meet
our criteria. We will remain disciplined in our approach to
business development. We intend to close the San Juan transaction
before December 31, subject to closing conditions and approvals,
using a combination of cash on hand and debt financing."
"I am extraordinarily proud of the numerous awards our mines
received during the quarter including the prestigious Sentinels of
Safety award and the 2015 Railroad Commission of Texas Coal Mining
Reclamation Award at Jewett and the 2015 North Dakota Public
Service Commission Reclamation Award at Beulah."
A copy of the press release is available for free at:
http://is.gd/FZvZfT
About Westmoreland Coal
Colorado Springs, Colo.-based Westmoreland Coal Company (NYSE
AMEX: WLB) -- http://www.westmoreland.com/-- is the oldest
independent coal company in the United States. The Company's coal
operations include coal mining in the Powder River Basin in
Montana and lignite mining operations in Montana, North Dakota and
Texas. Its power operations include ownership of the two-unit
ROVA coal-fired power plant in North Carolina.
Westmoreland Coal Company reported a net loss applicable to common
shareholders of $173 million in 2014, a net loss applicable to
common shareholders of $6.05 million in 2013 and a net loss
applicable to common shareholders of $8.58 million in 2012.
As of June 30, 2015, the Company had $1.7 billion in total assets,
$2.2 billion in total liabilities and a $423 million total
deficit.
* * *
As reported by the TCR on Nov. 20, 2014, Standard & Poor's Rating
Services raised its corporate credit rating on Westmoreland Coal
Co. one-notch to 'B' from 'B-'. "The stable outlook is supported
by Westmoreland's committed sales position over the next year,
which should result in stable cash flows," said Standard & Poor's
credit analyst Chiza Vitta.
Moody's upgraded the corporate family rating (CFR) of Westmoreland
Coal Company to 'B3' from 'Caa1', and assigned 'Caa1' rating to the
company's proposed new $300 million First Lien Term Loan, the TCR
reported on Nov. 20, 2014. The upgrade of the CFR reflects the
company's successful integration of the Canadian mines acquired in
April 2014, and Moody's expectation that the company's Debt/ EBITDA
will track at around 5x in 2015 and 2016 and that the company will
be break-even to modestly free cash flow positive over the same
time period.
WESTMORELAND RESOURCE: Reports Third Quarter 2015 Results
---------------------------------------------------------
Westmoreland Resource Partners, LP, reported its results for the
third quarter 2015. As released on Aug. 4, 2015, WMLP result now
include Westmoreland Kemmerer LLC for all periods presented.
Highlights for the third quarter 2015 include:
* Adjusted EBITDA for the third quarter 2015 of $16.1 million,
compared to $19.6 million in the third quarter 2014 on a pro
forma basis.
* Distributable Cash Flow for the third quarter 2015 of $3.0
million, down from $26.2 million in the third quarter 2014 on
a pro forma basis. Distributable cash flow for the third
quarter 2014 included proceeds of $17.6 million from a legal
settlement.
* Westmoreland Resources GP, LLC, general partner of WMLP,
declared a cash distribution for all unitholders and warrant
holders of $0.20 per unit for its third quarter ended
Sept. 30, 2015. The distribution will be paid on Nov. 13,
2015, to all unitholders and warrant holders of record as of
the close of business on Nov. 6, 2015.
* Achieved a reportable incident rate of 0.49 which is 28.7% of
the national surface coal reportable rate of 1.71, with no
lost time in the third quarter 2014.
The Company reported total revenues of $94.3 million for the three
months ended Sept. 30, 2015, compared to $136.4 million for the
three months ended Sept. 30, 2014, on a pro forma basis. The
decrease of $42.1 million was principally due to a one-time legal
settlement for lost coal sales of $17.6 million received during the
three months ended Sept. 30, 2014, in addition to a decrease of 0.4
million tons sold or $19.7 million compounded by a $1.14 decrease
in average selling price per ton or $2.4 million to $44.91 per ton
for the three months ended Sept. 30, 2015, from $46.05 for the
three months ended Sept. 30, 2014, on a pro forma basis.
The Company reported net loss of $12.7 million for the three months
ended Sept. 30, 2015, compared to net income of $14.0 million for
the three months ended Sept. 30, 2014, on a pro forma basis.
Additionally, the Company reported Adjusted EBITDA of $16.1 million
for the three months ended Sept. 30, 2015, compared to $19.6
million for the three months ended Sept. 30, 2014. The Company
reported distributable cash flow of $3.0 million for the three
months ended Sept. 30, 2015, compared to distributable cash flow of
$26.2 million for the three months ended Sept. 30, 2014, on a pro
forma basis. Distributable cash flow for the three months ended
Sept. 30, 2014, was enhanced by proceeds of $17.6 million for a
legal settlement. The gross profit margin per ton sold decreased
$0.31 per ton for the three months ended Sept. 30, 2015, to $7.43
per ton sold from $7.74 per ton for the three months ended Sept.
30, 2014.
Cash Distribution
Westmoreland Resources GP, LLC, general partner of WMLP, declared a
cash distribution for all of our unitholders and warrant holders of
$0.20 per unit for its third quarter ended Sept. 30, 2015. The
distribution will be paid on Nov. 13, 2015, to all unitholders and
warrant holders of record as of the close of business on Nov. 6,
2015.
About Westmoreland Resource
Oxford Resource Partners, LP, now known as Westmoreland Resource
Partners, LP, is a producer of high value steam coal, and is the
largest producer of surface mined coal in Ohio.
Westmoreland Resource reported a net loss of $28.6 million on $322
million of total revenues for the year ended Dec. 31, 2014,
compared with a net loss of $23.7 million on $347 million
of total revenues for the year ended Dec. 31, 2013.
As of June 30, 2015, Westmoreland Resource had $289.9 million in
total assets, $234.7 million in total liabilities and $55.2 million
in total partners' capital.
XPO LOGISTICS: S&P Lowers Rating on Sr. Unsec. Notes to 'B-'
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its issue-level rating
on Greenwich, Conn.-based XPO Logistics Inc.'s senior unsecured
notes to 'B-' from 'B' and revised its recovery rating on the notes
to '5' from '4' following the completion of the company's
acquisition of Con-Way Inc. S&P also removed the ratings from
CreditWatch, where it had placed them with negative implications on
Oct. 13, 2015. The '5' recovery rating indicates S&P's expectation
of modest (10%-30%; lower end of the range) recovery for
debtholders in the event of a payment default.
Following the completion of the merger, XPO assumed Con-way Inc.'s
senior unsecured notes. S&P currently rates the notes 'CCC+' with
a '6' recovery rating. The '6' recovery rating indicates S&P's
expectation for negligible recovery (0%-10%) in the event of a
default.
"Our ratings on XPO reflect its highly leveraged capital structure,
its aggressive growth strategy, and its position as one of the
largest and most diversified providers in the fragmented U.S.
third-party logistics market. The acquisition of Con-Way should
expand the company's competitive position by increasing its scale,
the scope of its services, and its product diversity. It also
changes the company's traditionally asset-light model as Con-Way's
truck fleet is included in the acquisition. We do not believe that
any of these factors support a revision of our "fair" assessment of
the company's business risk profile, which remains limited by its
weak operating efficiency (owing to its EBITDA margins, which have
suffered from the company's rapid growth). Integration risk also
remains somewhat of a concern, as XPO has embarked on two large,
transformative acquisitions (Norbert Dentressangle in August
followed by Con-Way in September) within the span of a month.
Earlier this year, the company set aggressive growth targets of $9
billion in revenues and
$575 million of EBITDA by 2017. Pro forma for the acquisitions of
Norbert Dentressangle and Con-Way, XPO's revenues and earnings will
double management's 2017 growth targets, rising to about $15
billion and $1.1 billion, respectively. XPO is supplementing its
growth-by-acquisition strategy with internal investments to further
expand its scale and scope," S&P said.
The firm's funds from operations (FFO)-to-debt ratio fell to just
1.8% for the last 12 months ended June 30, 2015, however, this
included only a partial year of cash flows from its acquired
businesses and all of the debt. By the end of 2015, S&P expects
this metric to improve to the mid-single digit percent area. The
company's FFO-to-debt ratio should improve further after that,
climbing to the mid-double digit percent area by the end of 2017,
which includes a full year of contributions from Con-Way and
Norbert Dentressangle.
RECOVERY ANALYSIS
Key analytical factors for recovery:
-- S&P has completed a review of the recovery analysis in view
of the company's acquisition of Con-way Inc.
-- S&P has lowered its recovery ratings on XPO's senior
unsecured notes to '5' (lower half of range) reflecting the
increased level of secured debt.
Simulated default and valuation assumptions:
-- Simulated year of default: 2018
-- EBITDA at emergence: $700 million
-- EBITDA multiple: 5.0x
Simplified waterfall:
-- Net enterprise value (after 5% admin. costs): $3.325 billion
-- Valuation split (obligors/nonobligors): 68%/32%
-- Priority claims: $65 million
-- Value available to first-lien debt claims
(collateral/noncollateral): $2.660 billion/$0
-- Secured asset-based lending (ABL) revolver debt claims:
$531 million
-- Recovery expectations: Not applicable
-- Value available to senior secured term loan claims
(collateral/noncollateral): $2.130 billion/$0
-- Secured term loan: $1.759 billion
-- Recovery expectations: 90%-100%
-- Total value available to unsecured claims (XPO/Con-way):
$586 million/$34 million
-- Senior XPO unsecured debt/pari passu unsecured claims:
$3.202 billion/$39 million
-- Recovery expectations: 10%-30% (lower half of the range)
-- Senior Con-way unsecured debt/pari passu unsecured claims:
$310 million/$109 million
-- Recovery expectations: 0%-10%
Note: All debt amounts include six months of prepetition interest.
Collateral value equals asset pledge from obligors after priority
claims plus equity pledge from nonobligors after nonobligor debt.
RATINGS LIST
XPO Logistics Inc.
Corporate Credit Rating B/Stable/--
Senior Unsecured Notes* CCC+
Recovery Rating 6
Ratings Lowered; Recovery Rating Revised
To From
XPO Logistics Inc.
Senior Unsecured Notes B- B/Watch Neg
Recovery Rating 5L 4L
* The senior unsecured notes were originally issued by Con-way Inc.
but were assumed by XPO following the completion of the
acquisition.
Z'TEJAS SCOTTSDALE: Wants Until Feb. 17, 2016 to Decide on Leases
-----------------------------------------------------------------
Z'Tejas Scottsdale, LLC, and its affiliated debtors ask the U.S.
Bankruptcy Court for the District of Arizona to extend the time
period for the Debtors to assume or reject unexpired
non-residential leases through Feb. 17, 2016.
The Debtors contend that absent a further order from the Court,
they would be required to assume, assume and assign, or reject the
Leases by no later than Nov. 19, 2015.
The Debtors relate that on Sept. 29, 2015 the Court entered its
Sale Order, which approved the sale of substantially all of the
Debtors' assets to Cornbread Ventures, LP. The Debtors further
relate that as part of the sale, the Debtors intend to assume and
assign its non-residential real property unexpired leases
("Leases") to the Buyer. The Debtors tell the Court that before
the Buyer commits to take the assignment of the Leases, it needs to
ensure that it will have obtained the necessary liquor licenses for
the respective restaurant locations. The Debtors further tell the
Court that in the unlikely event the Buyer is not able to obtain
the liquor licenses, the Buyer likely will not take assignment of
the lease associated with the applicable restaurant location. The
Debtors contend that as a result, they must preserve the ability to
assume and assign the Leases as and when the Buyer gives notice per
the terms of the Sale Order.
Z'Tejas Scottsdale is represented by:
John W. Lucas, Esq.
Jason H. Rosell, Esq.
PACHULSKI STANG ZIEHL & JONES LLP
150 California Street, 15th Floor
San Francisco, CA 94111
Telephone: (415)263-7000
Facsimile: (415)263-7010
E-mail: jlucas@pszjlaw.com
jrosell@pszjlaw.com
- and -
Randy Nussbaum, Esq.
Dean M. Dinner, Esq.
John Parzych, Esq.
NUSSBAUM GILLIS & DINNER, P.C.
14850 N. Scottsdale Road, Suite 450
Scottsdale, AZ 85254
Telephone: (480)609-0011
Facsimile: (480)609-0016
E-mail: rnussbaum@ngdlaw.com
ddinner@ngdlaw.com
jparzych@ngdlaw.com
About Z'Tejas Scottsdale
Based in Scottsdale, Arizona, Z'Tejas Scottsdale, LLC, et al.,
operate 9 Z'Tejas, Z'Tejas Southwestern Grill and Taco Guild
restaurants within the United States. The restaurant chain was
founded in 1989 by Larry Foels and Guy Villavso. Z'Tejas boasts
of
exceptional and innovative food and a unique look at each location
to provide a "non-chain feel". Five restaurants are in Arizona,
three are in Austin, Texas, and one in Costa Mesa, California.
The
company has 300 full time employees and 425 part-time employees.
Z'Tejas Scottsdale and its affiliates sought Chapter 11 protection
(Bankr. D. Ariz. Lead Case No. 15-09178) in Phoenix on July 22,
2015. The cases are assigned to Judge Paul Sala.
The Debtors have tapped Nussbaum Gillis & Dinner, P.C., and
Pachulski Stang Ziehl & Jones LLP as attorneys, and Mastodon
Ventures, Inc., as investment banker.
Lender Cornbread Ventures, LP, is represented by Jordan A. Kroop,
Esq., at Perkins Coie LLP, in Phoenix, Arizona.
The U.S. trustee overseeing the Debtors' bankruptcy cases
appointed
Farmers Insurance Company and The Wasserstrom Company to serve on
the official committee of unsecured creditors. Schneider &
Onofry,
P.C. represents the committee.
ZUCKER GOLDBERG: Lists $4.1MM in Assets, $36.7MM in Debts
---------------------------------------------------------
Zucker, Goldberg & Ackerman, LLC, filed with the U.S. Bankruptcy
Court for the District of New Jersey its schedules of assets and
liabilities, disclosing:
Name of Schedule Assets Liabilities
---------------- ----------- -----------
A. Real Property $0
B. Personal Property $10,503,966
C. Property Claimed as
Exempt
D. Creditors Holding
Secured Claims $2,850,000
E. Creditors Holding
Unsecured Priority
Claims $0
F. Creditors Holding
Unsecured Non-Priority
Claims $33,931,372
----------- -----------
Total $4,146,195 $36,781,372
A copy of the schedules is available for free at
http://bankrupt.com/misc/ZuckerGoldberg_amendedSAL.pdf
On Sept. 3, the Debtor filed amended Schedule E -- Creditors
Holding Unsecured Priority Claims, a copy of which is available at
http://bankrupt.com/misc/ZuckerGoldberg_Sept3ASAL.pdf
About Zucker Goldberg
Formed in 1923 as Zucker & Goldberg, law firm Zucker, Goldberg &
Ackerman, LLC, is primarily engaged in the representation of
lenders and secured parties in foreclosure matters, insolvency
proceedings and related matters. The sole members of ZGA are
Michael S. Ackerman, Esq. and Joel Ackerman, Esq. Michael S.
Ackerman is the managing member of the firm. ZGA's primary
offices are in Mountainside, New Jersey.
Zucker, Goldberg & Ackerman, LLC, sought Chapter 11 protection
(Bankr. D.N.J. Case No. 15-24585) in Newark, New Jersey, on
Aug. 3, 2015, to complete the orderly liquidation of the business.
The case is assigned to Judge Christine M. Gravelle.
The Debtor disclosed total assets of $11.5 million and total
liabilities of $53.3 million as of June 30, 2015.
ZGA tapped Wasserman, Jurista & Stolz, P.C. as bankruptcy counsel;
Brown, Moskowitz & Kallen, P.C., as special litigation counsel;
Genova Burns as labor counsel; and BMC Group, Inc., as noticing and
balloting agent.
The U.S. Trustee for Region 3 appointed seven creditors to serve on
an official committee of unsecured creditors.
[*] Rate of U.S. Bank TruPS CDO Upgrades to Slow, Fitch Says
------------------------------------------------------------
Slowing bank collateral redemptions and no apparent impetus for
redemptions to accelerate is likely to temper the rate of future
upgrades for U.S. bank TruPS CDOs, according to Fitch Ratings in a
new report.
Cost of capital, in contrast to the changes in the regulatory
treatment of TruPS in more recent years, will be at the forefront
of issuers' decision to redeem early. While almost half of the
issuers deferring at the end of 2Q'13 have cured, re-deferrals have
picked up most recently. In addition, many re-deferrals took place
shortly after issuers cured, which may suggest that some of the
re-performing banks have not fully recovered and may need
additional time to strengthen their capital base.
Additionally, a relative contribution from excess spread to CDO
notes amortization diminished compared to 2014. This trend is
expected to continue as more coverage tests come to compliance.
Increasing portfolio concentration and expected slowdown in
redemptions will temper future bank TruPS CDO upgrades, especially
at an investment grade level.
[*] Reduced Liquidity Ahead for US Midstream Issuers, Fitch Says
----------------------------------------------------------------
A modest decline in liquidity for U.S. midstream issuers is
expected for the balance of 2015 and into 2016, according to Fitch
Ratings. Issuers are expected to rely on revolvers given continued
spending and restrained capital markets and some high yield issuers
may have constraints as equity price weakness limits their ability
to raise equity.
The use of revolvers to temporarily finance acquisitions or fund
large capex projects is typically the largest use of liquidity in
this space. Many companies are focused on large construction
projects, particularly those associated with shale plays. Companies
will need to have ample liquidity during this investment phase and
the issuers Fitch evaluated currently appear to have adequate
borrowing capacity even as capital market access has tightened and
debt and equity issuances slowed.
The universe of issuers evaluated had only utilized 25% of total
revolver capacity as of June 30, 2015. However, Fitch anticipates
that midstream issuers are likely to utilize revolving credit
facilities following a slowdown in capital markets activity since
the end of second-quarter 2015.
Issuers in the midstream space have been hurt significantly by
lower equity prices since commodity prices began their decline in
late November 2014. The benchmark index for master limited
partnerhsips (MLPs) is the Alerian MLP Index, which has dropped
significantly since the end of second-quarter 2014. The higher
cost of equity capital has made accessing the equity markets an
unattractive option. Equity issuance slowed down notably in
third-quarter 2015 when issuances were $1.8 billion versus $4.6
billion in the prior year period.
Debt issuance within the space also seems to be slowing as issuers
were proactive in raising needed funding in the first half of the
year. During third-quarter 2015, debt raised in the midstream
space was down. In the recent quarter, it was $5.4 billion
compared with $10.5 billion in third-quarter 2014 and significantly
lower than the $17.8 billion raised in the second-quarter 2015.
Total debt issuances have been strong throughout 2015. In the
first nine months of 2015, total debt raised was $44.3 billion,
compared with $39.7 billion in 2014, according to data from SNL
Energy. In the first nine months of 2015, equity raises were $15.8
billion compared with $18.6 billion in 2014.
The midstream space is expected to have sufficient liquidity over
the next few quarters, with limited need to access capital markets
for most issuers, as most funding needs seem to have been largely
shored up in advance of the unattractive capital markets
experienced in third-quarter 2015. Liquidity will be slightly
reduced from levels seen at the end of second-quarter 2015.
Ultimately, issuers in the midstream space will need to return to
the debt and capital markets to fund spending requirements and
Fitch expects issuers to be opportunistic in doing so. Should
equity remain expensive, midstream names may consider financing
alternatives, including asset sales and hybrid issuances. Issuers
seeking growth that do not have the balance sheet for it may look
to form joint ventures or slow distribution growth to retain more
cash. Issuers with stronger balance sheets may pursue
acquisitions.
[*] The Deal Announces Results of Q3 2015 Bankruptcy League Tables
------------------------------------------------------------------
The Deal, a business unit of TheStreet, Inc. on Oct. 30 announced
the results of its quarterly rankings of the top firms and
professionals involved in active bankruptcy cases for the third
quarter of 2015. Collected data captures only active bankruptcy
work on ongoing U.S. and Canadian cases.
"In recent months, the state of the credit market, Chapter 11 sales
where there is nothing left over as well as pressure from senior
lenders have all led to faster Chapter 11's," said Kelsey Butler,
bankruptcy reporter at The Deal. "Industry professionals expect
this trend to continue as we move into 2016."
League Table highlights:
Akin Gump Strauss Hauer & Feld LLP remained in the top spot for
bankruptcy law firms by volume, with $1,041.9 billion in
liabilities. Vedder Price PC followed, with $973.6 billion in
liabilities. Duane Morris LLP remained in the third spot, with
$922.4 billion in liabilities. DLA Piper retained its ranking of
fourth, with $915.3 billion in liabilities.
Among lawyers by volume, Douglas Rosner (Goulston & Storrs PC)
ranked first, followed by Daniel Golden (Akin Gumo Strauss Hauer &
Feld), Peter Gilhuly (Latham & Watkins LLP), Richard Hahn
(Debevoise & Plimpton LLP) and Scott Davidson (King & Spalding
LLP).
For investment banks by volume, the top three banks kept their
rankings since Q2 2014. Blackstone Group LP maintained its lead,
with $802.7 billion in liabilities. Miller Buckfire & Co. LLC
followed in second place, with $726.1 billion in liabilities.
Jefferies LLC and Solic Capital Advisors LLC tied for third place,
with $83.8 billion each in liabilities. Millstein & Co. moved up
to fourth place, with $69.6 billion in liabilities.
The top two investment bankers kept their rankings from Q2 2014 by
volume, with Timothy Coleman (Blackstone Group LP) in the lead.
Stuart Erickson (Miller Buckfire & Co. LLC) followed. Steven Zelin
(Blackstone Group LP) ranked third, followed by Neil Luria (Solic
Capital Advisors LLC) and Richard Klein (Jefferies LLC).
The full suite of rankings is available at The Deal, and the full
report is also available online.
About The Deal's Bankruptcy League Tables
The Deal's Bankruptcy League Tables are the industry's only league
tables focused solely on active bankruptcy cases. The Bankruptcy
League Tables by volume involve only active U.S. bankruptcy cases
of debtors with liabilities of $10 million or more. The rankings
are based on the aggregation of those liability values. The table
reflects the number of active cases fitting that criteria and may
not characterize the total number of active cases. Firms and
professionals only get one credit for each active case, not each
active assignment. The Bankruptcy League Tables by number involve
U.S. and Canadian bankruptcy cases irrespective of debtor asset
size. Professionals receive credit for multiple assignments on one
case.
About The Deal
The Deal -- http://www.thedeal.com-- is a media and technology
company providing over 100,000 users with actionable ideas from its
two services -- The Deal & BoardEx. Law firms, investment banks,
private equity firms and hedge funds use The Deal service to find
their next deal and BoardEx to connect the dots between their
organizations and clients. The Deal is a business unit of
TheStreet, Inc. and has offices in New York, London, Washington,
D.C., Petaluma, CA and Chennai, India.
[] Quarterly Losses Reverse Course for Credit Card ABS, Fitch Says
------------------------------------------------------------------
Losses for U.S. credit card ABS edged lower last quarter following
two straight quarters of minor increases, according to Fitch
Ratings in its latest quarterly 'Movers & Shakers' index.
Credit card charge offs finished third-quarter 2015 4% lower than
the same period in 2014. Credit card delinquencies fell below 1%,
with late payments declining five basis points from the previous
quarterly average to 0.96%. 'Movement in credit card chargeoffs
will likely be minor as late payments continues to ease and hover
at historical lows,' said Director Herman Poon.
Average monthly payment rates also moved into record high territory
during 3Q'15 as credit card borrowers continued to keep their debt
in check. Average quarterly credit card ABS outstandings fell for
the first time after 10 straight quarterly increases.
[^] Large Companies with Insolvent Balance Sheet
------------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABT CN 149.9 (13.1) (8.1)
ABSOLUTE SOFTWRE ALSWF US 149.9 (13.1) (8.1)
ABSOLUTE SOFTWRE OU1 GR 149.9 (13.1) (8.1)
ADV MICRO DEVICE AMD* MM 3,229.0 (336.0) 980.0
ADVENT SOFTWARE ADVS US 424.8 (50.1) (110.8)
AEROJET ROCKETDY AJRD US 1,957.4 (107.2) 96.3
AEROJET ROCKETDY GCY GR 1,957.4 (107.2) 96.3
AIR CANADA ADH2 TH 12,374.0 (388.0) (53.0)
AIR CANADA ACDVF US 12,374.0 (388.0) (53.0)
AIR CANADA ACEUR EU 12,374.0 (388.0) (53.0)
AIR CANADA AC CN 12,374.0 (388.0) (53.0)
AIR CANADA ADH2 GR 12,374.0 (388.0) (53.0)
AK STEEL HLDG AKS* MM 4,250.3 (484.7) 792.0
AK STEEL HLDG AKS US 4,250.3 (484.7) 792.0
AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2)
AMYLIN PHARMACEU AMLN US 1,998.7 (42.4) 263.0
ANGIE'S LIST INC ANGI US 173.2 (19.8) (33.1)
ANGIE'S LIST INC 8AL GR 173.2 (19.8) (33.1)
ANGIE'S LIST INC 8AL TH 173.2 (19.8) (33.1)
ARIAD PHARM ARIAEUR EU 543.0 (13.8) 209.9
ARIAD PHARM APS TH 543.0 (13.8) 209.9
ARIAD PHARM ARIACHF EU 543.0 (13.8) 209.9
ARIAD PHARM ARIA SW 543.0 (13.8) 209.9
ARIAD PHARM APS GR 543.0 (13.8) 209.9
ARIAD PHARM ARIA US 543.0 (13.8) 209.9
ASPEN TECHNOLOGY AZPN US 266.8 (63.0) (44.1)
ASPEN TECHNOLOGY AST GR 266.8 (63.0) (44.1)
AUTOZONE INC AZ5 QT 8,102.3 (1,701.4) (742.6)
AUTOZONE INC AZ5 GR 8,102.3 (1,701.4) (742.6)
AUTOZONE INC AZOEUR EU 8,102.3 (1,701.4) (742.6)
AUTOZONE INC AZ5 TH 8,102.3 (1,701.4) (742.6)
AUTOZONE INC AZO US 8,102.3 (1,701.4) (742.6)
AVID TECHNOLOGY AVD GR 276.2 (338.1) (147.2)
AVID TECHNOLOGY AVID US 276.2 (338.1) (147.2)
AVINTIV SPECIALT POLGA US 1,991.4 (3.9) 322.1
BARRACUDA NETWOR CUDAEUR EU 421.3 (26.4) 42.0
BARRACUDA NETWOR 7BM GR 421.3 (26.4) 42.0
BARRACUDA NETWOR CUDA US 421.3 (26.4) 42.0
BERRY PLASTICS G BERY US 5,011.0 (74.0) 634.0
BERRY PLASTICS G BP0 GR 5,011.0 (74.0) 634.0
BLUE BIRD CORP 1291067D US 307.6 (133.8) 5.4
BLUE BIRD CORP BLBD US 307.6 (133.8) 5.4
BLUE BUFFALO PET BUFF US 459.5 (33.7) 258.1
BLUE BUFFALO PET B6B TH 459.5 (33.7) 258.1
BLUE BUFFALO PET B6B GR 459.5 (33.7) 258.1
BOMBARDIER INC-B BBDBN MM 23,863.0 (3,660.0) 1,076.0
BOMBARDIER-B OLD BBDYB BB 23,863.0 (3,660.0) 1,076.0
BOMBARDIER-B W/I BBD/W CN 23,863.0 (3,660.0) 1,076.0
BRINKER INTL EAT US 1,549.3 (108.1) (201.0)
BRINKER INTL BKJ GR 1,549.3 (108.1) (201.0)
BRP INC/CA-SUB V B15A GR 2,223.5 (31.1) 255.8
BRP INC/CA-SUB V DOO CN 2,223.5 (31.1) 255.8
BRP INC/CA-SUB V BRPIF US 2,223.5 (31.1) 255.8
BURLINGTON STORE BURL* MM 2,673.6 (40.6) 166.6
BURLINGTON STORE BUI GR 2,673.6 (40.6) 166.6
BURLINGTON STORE BURL US 2,673.6 (40.6) 166.6
CABLEVISION SY-A CVY TH 6,712.1 (4,951.2) 61.0
CABLEVISION SY-A CVC US 6,712.1 (4,951.2) 61.0
CABLEVISION SY-A CVY GR 6,712.1 (4,951.2) 61.0
CABLEVISION SY-A CVCEUR EU 6,712.1 (4,951.2) 61.0
CABLEVISION-W/I 8441293Q US 6,712.1 (4,951.2) 61.0
CABLEVISION-W/I CVC-W US 6,712.1 (4,951.2) 61.0
CAMBIUM LEARNING ABCD US 156.6 (75.1) (16.2)
CASELLA WASTE WA3 GR 660.7 (15.6) 4.9
CASELLA WASTE CWST US 660.7 (15.6) 4.9
CEDAR FAIR LP FUN US 2,076.3 (3.5) (89.1)
CEDAR FAIR LP 7CF GR 2,076.3 (3.5) (89.1)
CENTENNIAL COMM CYCL US 1,480.9 (925.9) (52.1)
CHOICE HOTELS CHH US 712.8 (400.6) 168.4
CHOICE HOTELS CZH GR 712.8 (400.6) 168.4
CINCINNATI BELL CBB US 1,509.6 (403.5) (0.2)
CINCINNATI BELL CIB GR 1,509.6 (403.5) (0.2)
CLEAR CHANNEL-A C7C GR 6,188.4 (263.3) 386.6
CLEAR CHANNEL-A CCO US 6,188.4 (263.3) 386.6
CLIFFS NATURAL R CLF* MM 2,271.5 (1,759.5) 406.0
COMMUNICATION CSAL US 2,645.6 (969.3) -
COMMUNICATION 8XC GR 2,645.6 (969.3) -
CORIUM INTERNATI CORI US 59.3 (5.4) 31.2
CRIUS ENERGY TRU KWH-U CN 307.3 (53.4) (69.5)
CYAN INC CYNI US 112.1 (18.4) 56.9
CYAN INC YCN GR 112.1 (18.4) 56.9
DELEK LOGISTICS DKL US 352.0 (15.8) 5.5
DELEK LOGISTICS D6L GR 352.0 (15.8) 5.5
DIRECTV DTV US 25,321.0 (3,463.0) 1,360.0
DIRECTV DTV CI 25,321.0 (3,463.0) 1,360.0
DIRECTV DTVEUR EU 25,321.0 (3,463.0) 1,360.0
DOMINO'S PIZZA DPZ US 603.2 (1,255.9) 125.1
DOMINO'S PIZZA EZV GR 603.2 (1,255.9) 125.1
DOMINO'S PIZZA EZV TH 603.2 (1,255.9) 125.1
DUN & BRADSTREET DB5 GR 2,092.7 (1,217.9) (412.7)
DUN & BRADSTREET DNB1EUR EU 2,092.7 (1,217.9) (412.7)
DUN & BRADSTREET DNB US 2,092.7 (1,217.9) (412.7)
DUNKIN' BRANDS G 2DB GR 3,348.1 (65.8) 285.7
DUNKIN' BRANDS G DNKN US 3,348.1 (65.8) 285.7
DUNKIN' BRANDS G 2DB TH 3,348.1 (65.8) 285.7
DURATA THERAPEUT DRTX US 82.1 (16.1) 11.7
DURATA THERAPEUT DTA GR 82.1 (16.1) 11.7
DURATA THERAPEUT DRTXEUR EU 82.1 (16.1) 11.7
EDGE THERAPEUTIC EU5 GR 62.7 (39.3) 56.4
EDGE THERAPEUTIC EDGE US 62.7 (39.3) 56.4
EDGEN GROUP INC EDG US 883.8 (0.8) 409.2
ENERGIZER HOLDIN ENR US 1,117.1 (296.9) 316.4
EOS PETRO INC EOPT US 1.2 (25.4) (26.6)
EPL OIL & GAS IN EPL US 1,496.3 (54.2) (253.5)
EPL OIL & GAS IN EPA1 GR 1,496.3 (54.2) (253.5)
EXELIXIS INC EX9 GR 248.8 (188.2) 31.5
EXELIXIS INC EXEL US 248.8 (188.2) 31.5
EXELIXIS INC EXELEUR EU 248.8 (188.2) 31.5
EXELIXIS INC EX9 TH 248.8 (188.2) 31.5
EXTENDICARE INC EXE CN 2,167.5 (10.8) (47.7)
EXTENDICARE INC EXETF US 2,167.5 (10.8) (47.7)
FREESCALE SEMICO 1FS GR 3,159.0 (3,079.0) 1,264.0
FREESCALE SEMICO FSLEUR EU 3,159.0 (3,079.0) 1,264.0
FREESCALE SEMICO 1FS TH 3,159.0 (3,079.0) 1,264.0
FREESCALE SEMICO FSL US 3,159.0 (3,079.0) 1,264.0
GAMING AND LEISU 2GL GR 2,516.0 (135.8) 5.9
GAMING AND LEISU GLPI US 2,516.0 (135.8) 5.9
GARDA WRLD -CL A GW CN 1,531.1 (362.2) 56.2
GARTNER INC GGRA GR 1,861.0 (170.2) (138.5)
GARTNER INC IT US 1,861.0 (170.2) (138.5)
GENESIS HEALTHCA SH11 GR 6,103.4 (244.5) 228.5
GENESIS HEALTHCA GEN US 6,103.4 (244.5) 228.5
GENTIVA HEALTH GHT GR 1,225.2 (285.2) 130.0
GENTIVA HEALTH GTIV US 1,225.2 (285.2) 130.0
GLG PARTNERS INC GLG US 400.0 (285.6) 156.9
GLG PARTNERS-UTS GLG/U US 400.0 (285.6) 156.9
GOLD RESERVE INC GRZ CN 16.3 (28.8) (39.0)
GOLD RESERVE INC GDRZF US 16.3 (28.8) (39.0)
GRAHAM PACKAGING GRM US 2,947.5 (520.8) 298.5
GYMBOREE CORP/TH GYMB US 1,243.7 (378.0) 32.7
HCA HOLDINGS INC 2BH TH 31,896.0 (5,812.0) 2,908.0
HCA HOLDINGS INC HCAEUR EU 31,896.0 (5,812.0) 2,908.0
HCA HOLDINGS INC 2BH GR 31,896.0 (5,812.0) 2,908.0
HCA HOLDINGS INC HCA US 31,896.0 (5,812.0) 2,908.0
HD SUPPLY HOLDIN HDS US 6,505.0 (393.0) 1,466.0
HD SUPPLY HOLDIN 5HD GR 6,505.0 (393.0) 1,466.0
HERBALIFE LTD HLFEUR EU 2,415.1 (196.4) 363.2
HERBALIFE LTD HLF US 2,415.1 (196.4) 363.2
HERBALIFE LTD HOO GR 2,415.1 (196.4) 363.2
HOVNANIAN-A-WI HOV-W US 2,549.3 (151.5) 1,595.3
HUGHES TELEMATIC HUTCU US 110.2 (101.6) (113.8)
IDEXX LABS IX1 TH 1,477.2 (38.8) 8.6
IDEXX LABS IX1 GR 1,477.2 (38.8) 8.6
IDEXX LABS IDXX US 1,477.2 (38.8) 8.6
IHEARTMEDIA INC IHRT US 13,626.9 (10,240.8) 816.5
IMMUNOMEDICS INC IMMU US 105.8 (4.5) 91.4
INFOR US INC LWSN US 6,778.1 (460.0) (305.9)
INVENTIV HEALTH VTIV US 2,154.4 (613.8) 84.5
IPCS INC IPCS US 559.2 (33.0) 72.1
ISTA PHARMACEUTI ISTA US 124.7 (64.8) 2.2
JUST ENERGY GROU JE US 1,229.2 (528.2) (6.6)
JUST ENERGY GROU JE CN 1,229.2 (528.2) (6.6)
JUST ENERGY GROU 1JE GR 1,229.2 (528.2) (6.6)
L BRANDS INC LTD TH 6,804.0 (647.0) 928.0
L BRANDS INC LTD QT 6,804.0 (647.0) 928.0
L BRANDS INC LTD GR 6,804.0 (647.0) 928.0
L BRANDS INC LBEUR EU 6,804.0 (647.0) 928.0
L BRANDS INC LB US 6,804.0 (647.0) 928.0
L BRANDS INC LB* MM 6,804.0 (647.0) 928.0
LEAP WIRELESS LEAP US 4,662.9 (125.1) 346.9
LEAP WIRELESS LWI TH 4,662.9 (125.1) 346.9
LEAP WIRELESS LWI GR 4,662.9 (125.1) 346.9
LORILLARD INC LLV TH 4,154.0 (2,134.0) 1,135.0
LORILLARD INC LO US 4,154.0 (2,134.0) 1,135.0
LORILLARD INC LLV GR 4,154.0 (2,134.0) 1,135.0
MAJESCOR RESOURC MJXEUR EU 0.0 (0.1) (0.1)
MALIBU BOATS-A MBUU US 189.1 (11.3) 6.7
MALIBU BOATS-A M05 GR 189.1 (11.3) 6.7
MANNKIND CORP MNKD IT 352.6 (115.5) (196.4)
MANNKIND CORP MNKD US 352.6 (115.5) (196.4)
MARRIOTT INTL-A MAQ TH 6,153.0 (3,589.0) (1,786.0)
MARRIOTT INTL-A MAR US 6,153.0 (3,589.0) (1,786.0)
MARRIOTT INTL-A MAQ GR 6,153.0 (3,589.0) (1,786.0)
MCBC HOLDINGS IN 1SG GR 89.7 (42.3) (34.4)
MCBC HOLDINGS IN MCFT US 89.7 (42.3) (34.4)
MDC COMM-W/I MDZ/W CN 1,617.2 (376.7) (326.5)
MDC PARTNERS-A MD7A GR 1,617.2 (376.7) (326.5)
MDC PARTNERS-A MDCA US 1,617.2 (376.7) (326.5)
MDC PARTNERS-A MDZ/A CN 1,617.2 (376.7) (326.5)
MDC PARTNERS-EXC MDZ/N CN 1,617.2 (376.7) (326.5)
MERITOR INC MTOR US 2,453.0 (591.0) 360.0
MERITOR INC AID1 GR 2,453.0 (591.0) 360.0
MERRIMACK PHARMA MP6 GR 105.0 (143.1) (33.7)
MERRIMACK PHARMA MACK US 105.0 (143.1) (33.7)
MICHAELS COS INC MIM GR 1,864.0 (1,992.6) 501.0
MICHAELS COS INC MIK US 1,864.0 (1,992.6) 501.0
MIDSTATES PETROL MPO1EUR EU 1,796.2 (322.8) 117.4
MONEYGRAM INTERN MGI US 4,511.4 (244.2) (27.1)
MOODY'S CORP MCOEUR EU 4,772.9 (240.2) 1,811.9
MOODY'S CORP MCO US 4,772.9 (240.2) 1,811.9
MOODY'S CORP DUT GR 4,772.9 (240.2) 1,811.9
MOODY'S CORP DUT TH 4,772.9 (240.2) 1,811.9
MPG OFFICE TRUST 1052394D US 1,280.0 (437.3) -
NATHANS FAMOUS NFA GR 85.6 (62.7) 59.1
NATHANS FAMOUS NATH US 85.6 (62.7) 59.1
NATIONAL CINEMED XWM GR 1,010.5 (221.6) 73.0
NATIONAL CINEMED NCMI US 1,010.5 (221.6) 73.0
NAVIDEA BIOPHARM NAVB IT 22.2 (44.6) 13.9
NAVISTAR INTL IHR TH 6,769.0 (4,809.0) 873.0
NAVISTAR INTL IHR GR 6,769.0 (4,809.0) 873.0
NAVISTAR INTL NAV US 6,769.0 (4,809.0) 873.0
NEFF CORP-CL A NEFF US 668.9 (187.7) 10.4
NEW ENG RLTY-LP NEN US 177.2 (29.6) -
NORTHWEST BIO NWBO US 64.2 (76.2) (95.3)
NORTHWEST BIO NBYA GR 64.2 (76.2) (95.3)
NTELOS HOLDINGS NTLS US 668.4 (22.1) 150.8
OMTHERA PHARMACE OMTH US 18.3 (8.5) (12.0)
OREXIGEN THERAPE OREX US 191.2 (4.2) 152.7
OUTERWALL INC CS5 GR 1,266.8 (2.1) (7.0)
OUTERWALL INC OUTR US 1,266.8 (2.1) (7.0)
PALM INC PALM US 1,007.2 (6.2) 141.7
PBF LOGISTICS LP PBFX US 417.8 (199.9) 18.7
PBF LOGISTICS LP 11P GR 417.8 (199.9) 18.7
PHILIP MORRIS IN 4I1 QT 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PM FP 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN 4I1 GR 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PM1EUR EU 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PMI SW 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PMI1 IX 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN 4I1 TH 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PM1CHF EU 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PM US 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PMI EB 32,011.0 (12,226.0) 10.0
PHILIP MORRIS IN PM1 TE 32,011.0 (12,226.0) 10.0
PLAYBOY ENTERP-A PLA/A US 165.8 (54.4) (16.9)
PLAYBOY ENTERP-B PLA US 165.8 (54.4) (16.9)
PLY GEM HOLDINGS PGEM US 1,312.8 (119.6) 258.1
PLY GEM HOLDINGS PG6 GR 1,312.8 (119.6) 258.1
POLYMER GROUP-B POLGB US 1,991.4 (3.9) 322.1
PROTALEX INC PRTX US 1.1 (13.5) 0.6
PROTECTION ONE PONE US 562.9 (61.8) (7.6)
PUREBASE CORP PUBC US 0.4 (1.1) (1.4)
PURETECH HEALTH PRTCL EB - - -
PURETECH HEALTH PRTCGBX EU - - -
PURETECH HEALTH PRTC LN - - -
PURETECH HEALTH PRTCL IX - - -
PURETECH HEALTH PRTCL PO - - -
PURETECH HEALTH PRTCL B3 - - -
QUALITY DISTRIBU QLTY US 413.0 (22.9) 102.9
QUALITY DISTRIBU QDZ GR 413.0 (22.9) 102.9
QUINTILES TRANSN QTS GR 4,033.7 (179.9) 996.2
QUINTILES TRANSN Q US 4,033.7 (179.9) 996.2
RAYONIER ADV RYQ GR 1,286.9 (17.0) 208.0
RAYONIER ADV RYAM US 1,286.9 (17.0) 208.0
REGAL ENTERTAI-A RGC* MM 2,590.9 (890.9) (107.2)
REGAL ENTERTAI-A RETA GR 2,590.9 (890.9) (107.2)
REGAL ENTERTAI-A RGC US 2,590.9 (890.9) (107.2)
RENAISSANCE LEA RLRN US 57.0 (28.2) (31.4)
RENTECH NITROGEN 2RN GR 328.0 (73.5) 43.7
RENTECH NITROGEN RNF US 328.0 (73.5) 43.7
RENTPATH LLC PRM US 208.0 (91.7) 3.6
REVLON INC-A RVL1 GR 1,926.6 (629.2) 322.1
REVLON INC-A REV US 1,926.6 (629.2) 322.1
RURAL/METRO CORP RURL US 303.7 (92.1) 72.4
RYERSON HOLDING 7RY GR 1,855.4 (114.9) 681.2
RYERSON HOLDING RYI US 1,855.4 (114.9) 681.2
SALLY BEAUTY HOL SBH US 2,189.6 (190.2) 819.6
SALLY BEAUTY HOL S7V GR 2,189.6 (190.2) 819.6
SANCHEZ ENERGY C SN US 1,935.3 (53.1) 206.7
SANCHEZ ENERGY C 13S TH 1,935.3 (53.1) 206.7
SANCHEZ ENERGY C SN* MM 1,935.3 (53.1) 206.7
SANCHEZ ENERGY C 13S GR 1,935.3 (53.1) 206.7
SBA COMM CORP-A SBACEUR EU 7,751.9 (1,133.2) 30.4
SBA COMM CORP-A SBJ GR 7,751.9 (1,133.2) 30.4
SBA COMM CORP-A SBJ TH 7,751.9 (1,133.2) 30.4
SBA COMM CORP-A SBAC US 7,751.9 (1,133.2) 30.4
SCIENTIFIC GAM-A SGMS US 9,486.5 (260.1) 741.2
SCIENTIFIC GAM-A TJW GR 9,486.5 (260.1) 741.2
SEARS HOLDINGS SEE TH 13,186.0 (906.0) 2,092.0
SEARS HOLDINGS SEE GR 13,186.0 (906.0) 2,092.0
SEARS HOLDINGS SHLD US 13,186.0 (906.0) 2,092.0
SECTOR 5 INC SECT US 0.0 (0.0) (0.0)
SILVER SPRING NE 9SI TH 517.9 (104.9) (38.1)
SILVER SPRING NE 9SI GR 517.9 (104.9) (38.1)
SILVER SPRING NE SSNI US 517.9 (104.9) (38.1)
SIRIUS XM CANADA SIICF US 297.1 (132.8) (177.9)
SIRIUS XM CANADA XSR CN 297.1 (132.8) (177.9)
SLEEP COUNTRY CA 1S2 GR 1.5 (0.9) (1.2)
SLEEP COUNTRY CA ZZZ CN 1.5 (0.9) (1.2)
SOLAZYME INC S7Y GR 209.0 (19.5) 120.5
SOLAZYME INC SZYM US 209.0 (19.5) 120.5
SPIN MASTER -SVC TOY CN 350.8 (66.2) (179.5)
SPIN MASTER -SVC SNMSF US 350.8 (66.2) (179.5)
SPIN MASTER -SVC SP9 GR 350.8 (66.2) (179.5)
SPORTSMAN'S WARE 06S GR 325.9 (24.2) 81.4
SPORTSMAN'S WARE SPWH US 325.9 (24.2) 81.4
STINGRAY - SUB V RAY/A CN 128.2 (17.8) (41.0)
STINGRAY DIG-VSV RAY/B CN 128.2 (17.8) (41.0)
SUN BIOPHARMA IN SNBP US - - -
SUPERVALU INC SJ1 GR 4,612.0 (511.0) (42.0)
SUPERVALU INC SVU* MM 4,612.0 (511.0) (42.0)
SUPERVALU INC SVU US 4,612.0 (511.0) (42.0)
SUPERVALU INC SJ1 TH 4,612.0 (511.0) (42.0)
SYNERGY PHARMACE SGYP US 164.8 (21.9) 147.2
SYNERGY PHARMACE S90 GR 164.8 (21.9) 147.2
SYNERGY PHARMACE SGYPEUR EU 164.8 (21.9) 147.2
THERAVANCE HVE GR 437.6 (323.0) 209.2
THERAVANCE THRX US 437.6 (323.0) 209.2
THRESHOLD PHARMA NZW1 GR 73.9 (26.3) 46.6
THRESHOLD PHARMA THLD US 73.9 (26.3) 46.6
TRANSDIGM GROUP TDG US 8,350.4 (1,169.0) 1,349.8
TRANSDIGM GROUP T7D GR 8,350.4 (1,169.0) 1,349.8
TRINET GROUP INC TNETEUR EU 1,557.0 (7.9) 50.7
TRINET GROUP INC TN3 GR 1,557.0 (7.9) 50.7
TRINET GROUP INC TNET US 1,557.0 (7.9) 50.7
UNISYS CORP USY1 GR 2,097.9 (1,451.3) 124.7
UNISYS CORP UISCHF EU 2,097.9 (1,451.3) 124.7
UNISYS CORP UISEUR EU 2,097.9 (1,451.3) 124.7
UNISYS CORP USY1 TH 2,097.9 (1,451.3) 124.7
UNISYS CORP UIS1 SW 2,097.9 (1,451.3) 124.7
UNISYS CORP UIS US 2,097.9 (1,451.3) 124.7
VECTOR GROUP LTD VGR US 1,462.8 (1.7) 514.4
VECTOR GROUP LTD VGR GR 1,462.8 (1.7) 514.4
VENOCO INC VQ US 598.9 (151.0) 207.6
VERISIGN INC VRSN US 2,577.3 (1,031.4) (38.8)
VERISIGN INC VRS TH 2,577.3 (1,031.4) (38.8)
VERISIGN INC VRS GR 2,577.3 (1,031.4) (38.8)
VERIZON TELEMATI HUTC US 110.2 (101.6) (113.8)
VERSEON CORP VSN LN - - -
VIRGIN MOBILE-A VM US 307.4 (244.2) (138.3)
VTV THERAPEUTI-A VTVT US 19.0 (80.9) (60.3)
W&T OFFSHORE INC WTI US 2,085.0 (0.8) (95.1)
WEIGHT WATCHERS WTW US 1,341.2 (1,347.5) (207.2)
WEIGHT WATCHERS WTWEUR EU 1,341.2 (1,347.5) (207.2)
WEIGHT WATCHERS WW6 TH 1,341.2 (1,347.5) (207.2)
WEIGHT WATCHERS WW6 QT 1,341.2 (1,347.5) (207.2)
WEIGHT WATCHERS WW6 GR 1,341.2 (1,347.5) (207.2)
WEST CORP WSTC US 3,549.9 (625.9) 265.3
WEST CORP WT2 GR 3,549.9 (625.9) 265.3
WESTERN REFINING WR2 GR 441.6 (27.7) 66.8
WESTERN REFINING WNRL US 441.6 (27.7) 66.8
WINGSTOP INC EWG GR 117.4 (17.4) 6.0
WINGSTOP INC WING US 117.4 (17.4) 6.0
WINMARK CORP GBZ GR 46.8 (36.0) 11.1
WINMARK CORP WINA US 46.8 (36.0) 11.1
WYNN RESORTS LTD WYNN SW 9,283.0 (110.7) 860.6
WYNN RESORTS LTD WYR QT 9,283.0 (110.7) 860.6
WYNN RESORTS LTD WYNNCHF EU 9,283.0 (110.7) 860.6
WYNN RESORTS LTD WYNN* MM 9,283.0 (110.7) 860.6
WYNN RESORTS LTD WYR GR 9,283.0 (110.7) 860.6
WYNN RESORTS LTD WYNN US 9,283.0 (110.7) 860.6
WYNN RESORTS LTD WYR TH 9,283.0 (110.7) 860.6
XERIUM TECHNOLOG XRM US 578.2 (95.4) 75.9
XERIUM TECHNOLOG TXRN GR 578.2 (95.4) 75.9
YRC WORLDWIDE IN YRCW US 1,964.8 (427.3) 197.3
YRC WORLDWIDE IN YEL1 TH 1,964.8 (427.3) 197.3
YRC WORLDWIDE IN YEL1 GR 1,964.8 (427.3) 197.3
*********
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.
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 nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
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 2015. 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 ***