Patriot Coal Agrees to Stop Mountaintop Removal Mining
Bankrupt Patriot Coal Corp. agreed Thursday to become the first U.S. coal operator to phase out and eventually stop all large-scale mountaintop removal mining in central Appalachia under an agreement reached with three environmental groups that sued over pollution from several West Virginia operations.
Mountaintop removal is a highly efficient but particularly destructive form of strip mining unique to West Virginia, Kentucky, Virginia and Tennessee. Coal companies blast apart mountain ridge tops to expose multiple coal seams. The resulting rock and debris is dumped in streams, creating so-called valley fills.
People who live near the operations complain about not only property damage but also health problems they believe are related to the dust and water pollution the operations create. Whether the practice should continue has been the source of intense conflict in West Virginia, where surface miners depend on it for their livelihoods.
Presented to U.S. District Judge Robert Chambers in Huntington for consideration, the agreement stemmed from water pollution lawsuits filed by the Sierra Club, Ohio Valley Environmental Coalition and West Virginia Highlands Conservancy.
In presenting the agreement, Patriot President Ben Hatfield told the court that the continuation or expansion of large-scale surface mining is no longer in Patriot’s best long-term interests. In exchange for phasing out mountaintop removal and agreeing to caps on the amount of coal it produces from strip mining, Patriot gets additional time to install selenium treatment systems at several mines.
The agreement also requires Patriot to make a $500,000 donation to a nonprofit land-use organization of the plaintiffs’ choosing and requires Patriot to ask the U.S. Bankruptcy Court for permission to pay the environmental group’s $96,000 in legal fees.
Patriot Coal filed for bankruptcy protection in July, prompted by the company’s struggles with low coal prices. At the time, the company said that it had $3.6 billion in assets against $3.1 billion in debts and that it had lost money every year since 2010.
New York Menswear Factory Owner HMX Group Files for Bankruptcy
Manhattan-based Hickey Freeman menswear factory has filed for Chapter 11 bankruptcy protection from its in U.S. Bankruptcy Court in Manhattan. In its Chapter 11 documents, the company listed assets of less than $50,000 against debt of more than $50 million.
In its filing, HMX said it hopes to sell its assets to Authentic Brands Group LLC, a brand development and licensing company. The company’s assets are likely to be auctioned off to the highest bidder in bankruptcy court.
Salus Capital Partners of suburban Boston, has agreed to provide $65 million to keep HMX operational during its Chapter 11 case.
In a memo distributed to Hickey Freeman’s 500 workers, HMX CEO Douglas Williams acknowledged “liquidity” issues. The memo also warned “of a possible cessation of operations by the HMX Group … which could result in your loss of employment.” State law requires advance notice of any possible closure or sizable job loss. Williams later told reporters that the memo was a regulatory requirement and no Hickey Freeman layoffs are under way or anticipated.
Sen. Charles Schumer, D-N.Y., who helped HMX obtain private financing in August released a statement saying that HMX’s previous investor, SKNL of India, had not “lived up to commitments to execute (the company’s) business plan.” Shumer said:
“I have helped save this company from liquidation twice, am in close contact with company executives, and will stand shoulder to shoulder once again with Rochester’s Hickey Freeman workers over the coming weeks to ensure any new owner commits to preserve Hickey Freeman’s Rochester factory and its workers.”
NewPage Reaches Agreement On Chapter 11 Plan
NewPage Corporation has announced it has reached an agreement in principle with all of its major creditor groups regarding its chapter 11 plan. NewPage, headquartered in Miamisburg, Ohio, produces printing and specialty papers used in commercial printing to create corporate collateral, magazines, catalogs, books, coupons, inserts and direct mail as well as in specialty paper applications including beverage bottle labels, food and medical packaging, pressure-sensitive labels and release liners.
The agreement was reached as part of court ordered mediation conducted by the court-appointed mediator, Bankruptcy Judge Robert D. Drain. At the request of certain parties participating in the mediation, the mediator did not provide any of the term sheets proposed by the parties to the mediation (or any of their material terms) to certain other parties participating in the mediation. Rather, the mediator served as an intermediary, facilitating discussion among the parties and encouraging the parties to make concessions in an effort to reach agreement upon a consensual chapter 11 plan.
Under the agreement in principle, first lien noteholders will receive, among other consideration, 100 percent of the equity in reorganized NewPage. The NewPage second lien noteholders and certain other unsecured creditors will receive their pro rata share of $30 million in cash and the first $50 million in proceeds that are realized by a litigation trust. After the first $50 million received by the trust, any additional proceeds received by the trust will be shared by the first lien noteholders, the second lien noteholders and certain unsecured creditors.
In announcing the agreement in principle, George F. Martin, President and CEO of NewPage said, “This is a very important step for NewPage, and assuming satisfaction of certain conditions, this agreement should allow us to emerge from chapter 11 in the near term.”
Burbank Medical Imaging Firm Files for Chapter 11 Reorganization
Burbank medical device company Imaging3 Inc. has filed a voluntary petition for Chapter 11 bankruptcy in U.S. Bankruptcy Court for Central California. The filing shows the company has $20.8 million in debt against $453,000 in assets. It posted a $17.9 million loss last year. Imaging3 is represented by bankruptcy attorney Brian L Davidoff of Greenberg Glusker in Los Angeles.
According to the company’s press release, Imaging3, founded in 1993, has developed a breakthrough medical imaging device that produces 3D medical diagnostic images of virtually any part of the human body in real-time. Because these 3D images are instantly constructed in real-time, they can be used for any current or new medical procedures in which multiple frames of reference are required to perform medical procedures on or in the human body.
However thus far, the company has been unable to obtain Federal Drug Administration approval for its 3D imaging technology. Revenue from its other business selling re-manufactured medical imaging devices has also lagged.
In its 1st quarter financial report, the 3D medical diagnostic imaging devices maker said it has to date been unable to raise enough revenue to cover research & development, marketing, operating and other costs. In that same report, Imaging3 noted it might be forced to file for bankruptcy. Company president and COOO Christopher Sohn tendered his resignation earlier this year. An SEC filing shows he left to pursue other interests and was paid a severance of approximately $9,100.
The Cliffs Emerges from Bankruptcy
The Cliffs Communities, a distinctive lifestyle community in the heart of the Carolinas, has announced that the entities known as the Cliffs Club and Hospitality Group, Inc., have emerged from Chapter 11 bankruptcy proceedings under the ownership of Silver Sun Partners, LLC.
Effective immediately, Silver Sun Partners will begin club operations under the management of its subsidiary, Cliffs Club Partners, LLC, while leveraging real estate sales and marketing programs through another subsidiary, Cliffs Land Partners, LLC. The partnership has committed significant capital resources that will create immediate stability within the clubs while preserving and enhancing real estate values within The Cliffs Communities. Cliffs Club Partners is also planning continued amenity improvement and development, which was halted during bankruptcy proceedings.
Silver Sun was formed as a partnership between The Carlile Group, a diversified company based in Marshall, Texas; Arendale Holdings, a real estate investment and development company specializing in residential communities and golf course operations; and SunTx Urbana, a real estate management and development company.
The partnership has provided The Cliffs with the capital to deleverage, operate and improve a network of clubs and amenities. Collectively, it offers the professional management, club operations and real estate development experience needed to deliver a global solution it says will ensure a strong future while upholding the distinctive lifestyle and brand of The Cliffs Communities.
Hawker Beechcraft Asks Bankruptcy Court For More Time To File Exclusive Chapter 11 Plan
Bankrupt jet maker Hawker Beechcraft, Inc. has asked the U.S. Bankruptcy Court for the Southern District of New York for more time to file a plan to emerge from bankruptcy.
The Nebraska-based company told the court it needs more time to evaluate and pursue its option, including emerging from bankruptcy as a stand-alone company and emerging through a third-party sale. The company also noted the complexity of its bankruptcy, which involves 18 Hawker Beechcraft entities, 5,400 employees and $2.4 billion in debt.
Hawker Beechcraft asked the bankruptcy court to extend the exclusivity period it has to file a Chapter 11 plan until at least Dec 29. It also wants to extend until Feb. 27 the time to solicit acceptance of the plan from each debtor. After the exclusivity period expires, creditors may file competing plans.
Earlier this summer the company announced court approval to enter into exclusive negotiations with Superior Aviation Beijing Co., Ltd. to acquire the civil aviation interests of the financially troubled group. The agreement would not include Hawker Beechcraft Defense Company (HBDC), which would continue to operate its T-6 trainer program as a separate entity. HBDC would also continue to pursue final certification of its AT-6, which is being considered by the U.S. Air Force for its light air support (LAS) program. The LAS contract has an initial value of $355 million and over time might be worth as much as $1 billion.
According to Hawker Beechcraft CEO Steve Miller, “At this time, pursuing the potential transaction with Superior is in the best interests of the company and its various stakeholders, including our creditors, our employees, our suppliers and our customers.”
Mark Shale Fashions Announces Chapter 11 Bankruptcy Reorganization
Mark Shale, the Chicago-area high-end fashion retailer, announced today that it has filed a voluntary petition for Chapter 11 business reorganization in the U.S. Bankruptcy Court of the Northern District of Illinois. According to documents submitted Tuesday to the Bankruptcy Court for the Northern District of Illinois, declining sales in women’s clothing, as well as the overall economic downturn, have had a detrimental effect on the company’s business.
Mark Shale’s President Rich Myers said: “We have tried since Mark Shale was acquired to ensure the lasting success of this 83-year-old Chicago icon. The company has always sought to bring quality and outstanding service to high-end fashion. We are proud to have some of the most experienced and loyal employees in the business, from sales associates, to tailors, to warehouse staff, to buyers and managers.
“Unfortunately, in the current economic environment and despite our significant efforts over the past few years, we have concluded that a Chapter 11 filing was the Company’s best alternative. We continue to seek a strategic partner to fortify the business. In the meantime, all three of our stores – at 900 N. Michigan Avenue, Oakbrook Center and Northbrook Court – will, as always, provide the highest level of service to our customers.”
Founded in 1929, Mark Shale has been one of Chicago’s premier providers of men’s and women’s clothing. Known for its extraordinary customer service and timeless clothing collections, Mark Shale has consistently been named one of the best stores in the United States by Esquire Magazine.
Bankruptcy Court Approves Reorganization of Prince Sports
U.S. Bankruptcy Judge Kevin J. Carey has approved the restructuring plan of Prince Sports, which pioneered the modern oversized tennis racquet.
The reorganization plan calls for lender ABG-Prince LLC to get all the reorganized company’s equity in exchange for the $67.2 million secured debt it currently holds. Unsecured creditors owed about $13.8 million will get proceeds from lawsuits and cash for an estimated recovery of 2.7 percent.
Prince, was founded in 1970 by Bob McClure who invented the “Little Prince,” the first ball machine for home court use, in his garage in Princeton, New Jersey. In 1976, the company revolutionized the sport by inventing the first oversize racket. The “Prince Classic” measured 110 square inches, had a much bigger “sweet spot” than traditional wooden rackets and became one of the best-selling rackets of all time.
In those better days, Prince gained endorsements from high profile champions including Maria Sharapova, Jimmy Connors and Martina Navratilova. However in December 2010, Sharapova ended her 10-year sponsorship agreement with Prince, and switched to Head NV a year later.
The Bordentown, New Jersey-based company to seek bankruptcy protection on May 1 in Wilmington, Delaware. Prince listed about $54.2 million in assets as of Dec. 31, 2011, and indicated it owed creditors more than $75 million. In court documents, the company cited as reasons for the bankruptcy declining demand, “increased competition over the past five years” and a drop in “consumer discretionary spending.”
Harper Brush Works Files for Chapter 11 Bankruptcy Protection
Harper Brush Works, Inc., an Iowa-based broom and brush manufacturing company, has filed for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of Iowa. The Company cited financial challenges caused by significant customer loss, as well as debt it incurred through recent expansion efforts. It listed assets and liabilities of approximately $10 million in the filing.
Harper Brush employs approximately 70 full-time and 5-10 part-time and contract labor employees, the majority of whom work from its headquarters in Fairfield, Iowa. Harper has announced that it will be able to restructure its obligations while continuing to operate and meet the needs of its customers and employees. At the current time, the company does not anticipate layoffs at the Fairfield location.
In a statement, Marc Ross, Chief Restructuring Officer said, “After careful consideration of our options, the board of directors and the senior management team believe that Chapter 11 is a necessary step to create a solid foundation for the future growth and success of Harper Brush Works.”
As a part of the restructuring process, Harper Brush is negotiating a new line of credit to provide ample funds for working capital and is also arranging new long-term investment and financing opportunities. In addition to restructuring its balance sheet, the Company’s objectives will be to maximize the revenue streams from its most popular products while eliminating the production of other, less profitable items.
Cantaloupe Grower Tied To Outbreak Declares Bankruptcy
Jensen Farms of Holly, Colorado has filed for Chapter 11 bankruptcy in U.S. Bankruptcy Court in Denver. The cantaloupe grower was the source of a deadly listeria outbreak last year. Records show the current partners of Jensen Farms are ESJ Inc., of Holly and Biologik, also of Holly. Eric Jensen is president of ESJ, Inc.
In its final report about the outbreak which occurred in September and October of 2011, the Food and Drug Administration reported more than 30 deaths and said a total of 146 people in 28 states were infected with outbreak-related strains of listeria monocytogenes. The FDA said the outbreak was likely spread by inadequate food safety procedures at the Jensen Farms packing facility.
According to bankruptcy documents, Jensen Farms estimated assets between $1 million and $10 million against estimated liabilities between $10 million and $50 million dollars. Jensen Farms listed $4.78 million in income from May 2011 to May 2012 and estimates it has 50 to 99 creditors. In addition, the filing also lists as potential liabilities twelve wrongful death lawsuits and seven personal injury lawsuits that have been filed against the company.
Jensen is represented by bankruptcy attorney Jim Markus, of Markus Williams Young & Zimmermann LLC, Denver, who said the filing should free up millions of dollars in insurance and other funds to pay victims of the outbreak.