beard corporate restructuring review for march 2012

Beard Group Corporate Restructuring ReviewFor March 2012

Presented byBeard Group, Inc.

P.O. Box 4250Frederick, MD 21705-4250

Voice: (240) 629-3300Fax: (240) 629-3360

E-mail: [email protected]

An audio recording of this presentation is available at http://bankrupt.com/restructuringreview/

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Welcome to the Beard Group Corporate Restructuring Review for March 2012, brought to you by the editors of the Troubled Company Reporter and Troubled Company Prospector.

In this month's Corporate Restructuring Review, we'll discuss five topics:

• first, last month's largest chapter 11 filings and other statistics;

• second, large chapter 11 filings TCR editors anticipate in the near-term;

• third, a quick review of the major pending disputes in chapter 11 cases that we monitor day-by-day;

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mailto:[email protected]

• fourth, reminders about debtors whose emergence from chapter 11 has been delayed; and

• fifth, information you're unlikely to find elsewhere about new publicly traded securities being issued by chapter 11 debtors.

March 2012 Mega Cases

Now, let's review the largest chapter 11 cases in March 2012.

Danilo Muñoz reports that there were five companies that filed for Chapter 11 protection with assets in excess of $100 million in March 2012. The number of large Chapter 11 filings decreased compared to the previous two months: there were nine mega filings in January and eight in February.

Mega bankruptcy filings continue to slide from previous years. During the first three months of 2011, there were 18 companies that filed for Chapter 11 with assets in excess of $100 million, or an average of six per month. During the first quarter of 2010, there were 34 mega filers, or an average of 10 per month.

The largest Chapter filing for March 2012 was filed by Bahrain-based Arcapita Bank B.S.C., also known as First Islamic Investment Bank B.S.C., which filed for Chapter 11 protection on March 19, 2012, with the Bankruptcy Court for the Southern District of New York in Manhattan [Lead Case No. 12-11076]. The Arcapita Group owns assets valued at roughly US$3.06 billion and has liabilities of roughly US$2.55 billion.

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Beard Group Corporate Restructuring Review for March 2012 -- page 2

Arcapita does not have the liquidity necessary to repay a $1.1 billion syndicated unsecured facility when it comes due on March 28, 2012.

Founded in 1996, Arcapita is a global manager of Shari'ah-compliant alternative investments and operates as an investment bank. Arcapita is headquartered in Bahrain and is regulated under an Islamic wholesale banking license issued by the Central Bank of Bahrain. The Arcapita Group employs 268 people and has offices in Atlanta, London, Hong Kong and Singapore in addition to its Bahrain headquarters. The Arcapita Group's principal activities include investing on its own account and providing investment opportunities to third-party investors in conformity with Islamic Shari'ah rules and principles. The Arcapita Group currently has roughly US$7 billion in assets under management.

The next largest Chapter 11 filing was by MF Global Holdings USA Inc., doing business as Farr Whitlock Dixon & Co. Inc., and Man Group USA Inc. Holdings USA had aggregate assets and liabilities, as of the quarterly period ended Sept. 30, 2011, of roughly $501 million and $68 million, respectively.

MF Global Holdings USA filed a Chapter 11 petition with the Bankruptcy Court for the Southern District of New York in Manhattan [Case No. 12-10863] on March 2, 2012, six months after parent MF Global Holdings Ltd. collapsed into bankruptcy. MF Global Holdings USA has its case jointly administered with the Chapter 11 cases of the prior debtors.

MF Global Holdings USA provided administrative services to MF Ltd. and its domestic subsidiaries. These services include, but are not limited to, administration of certain benefits programs, payroll and human resources processing. MF Ltd. and its domestic subsidiaries reimbursed Holdings USA for these _____________________________________________________________________________


services. Holdings USA incurs various costs, which are allocated to, and reimbursed by, MF Ltd. and its domestic subsidiaries. In addition, Holdings USA is the holding company for the majority of the U.S. subsidiaries of MF Global.

The third largest Chapter 11 filing was by Contract Research Solutions Inc., doing business as Cetero, a provider of early-phase clinical research services for pharmaceutical and biotechnology firms. The Company filed a Chapter 11 petition on March 26 with the Bankruptcy Court for the District of Delaware [case number 12-11004].

Cetero plans to sell the business to first-lien secured lenders in exchange for $50 million in debt, absent higher and better offers. First-lien lenders have offered to exchange $50 million in secured debt and assume $30 million in liabilities to buy the assets. First lien lenders are also providing a $15 million loan to finance the Chapter 11 effort. The Company listed total assets of $205 million and total debt of $248 million.

Cetero said in a court filing that the liquidity squeeze and ensuing default declared by lenders resulted from the discovery that some data recorded by company employees may have been inaccurate. Eight months ago, the U.S. Food and Drug Administration issued a report questioning the validity of data provided by Cetero to clients. The FDA ordered re-testing after finding hundreds of examples of faked research work over a five-year period at Cetero's Houston lab. The result was a liquidity squeeze and a default declared by senior lenders.

Also, two companies filed for Chapter 11 protection in March that listed estimated assets and liabilities of between $100 million to $500 million -- Keowee Falls Investment Group LLC and Granite Dells Ranch Holdings LLC.

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Keowee Falls Investment Group filed a Chapter 11 petition on March 2, 2012, with the Bankruptcy Court for the District of South Carolina, case number 12-01399. The Cliffs Communities, Inc., owns 100% of the shares.

Scottsdale, Arizona-based Granite Dells Ranch Holdings LLC filed for Chapter 11 protection on March 13, 2012, with the Bankruptcy Court for the District of Arizona [case number 12-04962], to stop foreclosure. Arizona Eco sued Granite Dells on March 6 asking the Arizona court to appoint a receiver. Arizona Eco is foreclosing on a secured loan backed by 15,000 acres of Arizona land.

In addition to the Chapter 11 filings, two companies filed for Chapter 15 in March with assets in excess of $100 million -- Tokyo-based Elpida Memory Inc. and Singapore-based Humpuss Sea Transport Pte. Ltd.

Yuko Sakamoto, as foreign representative, filed a Chapter 15 petition for Elpida on March 19, 2012, with the Bankruptcy Court for the District of Delaware [case number 12-10947].

Mr. Sakamoto says that ongoing litigation in the U.S. will force Elpida to incur substantial costs and divert significant monetary and personnel resources from the Japan reorganization effort. Elpida has been named as a defendant or counter-claim defendant in a number of matters in which it is alleged that Elpida products infringe certain patents. The suits alleged that certain Elpida DRAM products infringe on patents held by the complaining parties.

Cosimo Borrelli and Jason Aleksander Kardachi, of the restructuring and forensic accounting firm Borrelli Wash, the joint liquidators of Singapore-based Humpuss Sea Transport filed documents with the U.S. Bankruptcy Court for the Southern _____________________________________________________________________________


District of New York, seeking recognition of the winding up proceeding initiated in the High Court of the Republic of Singapore.

HST is a Singapore-based shipping company that operated a fleet of vessels. It ceased shipping at the end of 2009. In 2009, HST's books and records listed it's assets at roughly US$182 million.

There was no prepackaged bankruptcy filing out of the five bankruptcy mega cases for March, compared to one each in January and February. For the three months of 2012, only 2 of the 22 mega cases involved a prepackaged Chapter 11 filing, or about 9% of the mega cases.

For 2011, 13 of the 82 mega cases involved a prepackaged Chapter 11 plan as of the Petition Date -- or about 16% of the large Chapter 11 filings. For fiscal year 2010, a total of 35 prepacks/pre-arranged cases were filed out of the 106 bankruptcy mega cases -- or about one in every three filings in 2010.

Of the bankruptcy mega cases in March, two were engaged in finance, while the remainder was engaged in research, real estate and accommodation industries.

For the first three months of 2012, the real estate industry leads the pack with three bankruptcy mega filings, followed by a four-way tie between the manufacturing, information, transportation, and finance industries, each with two bankruptcy mega filing apiece.

During the month of March, two of the five mega cases were filed in the Southern District of New York, and one each in Delaware, Arizona, and the Northern District of Texas.

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For the first quarter of 2012, the Bankruptcy Court for the Southern District of New York was the most favored venue for mega filers with seven, closely followed by Delaware with six.

For 2011, the Delaware Bankruptcy Court continued to be favored by the bankruptcy mega cases with 38 filings, or 46% of the mega cases, followed by the Southern District of New York with 16 filings, or 19% of the mega cases, and by the Northern District of Texas with 4 filings, or 5% of the mega cases. The rest of the bankruptcy mega cases are spread evenly throughout the various bankruptcy courts.

Lehman Brothers Holding Corp. remains the biggest corporate bust in history. Lehman, which filed in 2008, had $639 billion in total assets and $613 billion in total debts at that time of its filing.

For 2011, the largest Chapter 11 filing was filed by MF Global Holdings Ltd. and its affiliates. As of Sept. 30, 2011, MF Global had $41.05 billion in total assets and $39.68 billion in total liabilities.

Anticipated Large Chapter 11 Filings

Now, let's turn to the topic of large chapter 11 filings Troubled Company Reporter editors anticipate in the near-term.

Carlo Fernandez identified seven companies that may be close to filing for bankruptcy. These are: NextWave Wireless, Houghton Mifflin, Eagle Hospitality, Springleaf Finance, Hawker Beechcraft, Reddy Ice, LightSquared Inc.

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(A) NextWave Wireless

NextWave Wireless Inc., which exited bankruptcy reorganization in 2005, submitted financial statements for 2011 in which the auditors said the company doesn't have the ability to repay maturing debt. The company said that maturing debt "could" cause a bankruptcy filing.

NextWave, which owns wireless spectrum assets, has secured debt of $1.022 billion.

San Diego, California-based NextWave acknowledges that current cash reserves are not sufficient to meet payment obligations under its secured notes at their current maturity dates. It added that it may not be able to consummate sales of its wireless spectrum assets for enough to repay debt at the scheduled maturity dates.

The independent auditor, Ernst & Young, said, "The Company has incurred recurring operating losses and has a working capital deficiency, primarily comprised of the current portion of long term obligations of $142.0 million at Dec. 31, 2011 that is associated with the maturity dates of its debt. The Company currently does not have the ability to repay this debt at maturity. These conditions raise substantial doubt about the Company’s ability to continue as a going concern."

"Insufficient capital to repay our debt at maturity would significantly restrict our ability to operate and could cause us to seek relief through a filing in the United States Bankruptcy Court," the Company said in the Form 10-K filed with the Securities and Exchange Commission.

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As of Dec. 31, 2011, the Company has assets of $463.7 million and debts of $1.124 billion. Cash and cash equivalents totaled $11.08 million as of Dec. 31.

(B) Houghton Mifflin

According to reports, textbook publisher Houghton Mifflin Harcourt Publishers Inc. has hired restructuring advisors in order to address its heavy debt load.

The Wall Street Journal, citing sources it did not identify, said Houghton has hired law firm Paul, Weiss, Rifkand, Wharton & Garrison and Blackstone Group. WSJ says the hirings mark the second time in two years Houghton has had to consider a debt restructuring.

Houghton carries more than $3 billion in debt from a leveraged buyout.

In March, Moody's Investors Service downgraded Houghton's corporate family rating, probability of default rating, and debt instrument ratings to Caa3 from Caa2. The downgrade reflects Moody's view that a debt restructuring in the near term is increasingly likely. The rating outlook is negative.

(C) Eagle Hospitality

Eagle Hospitality Properties Trust, Inc,. has tapped the law firm of Dewey & LeBoeuf and said it might seek Chapter 11 protection.

Eagle Hospitality said it is in talks with the Federal Reserve Bank of New York regarding a restructuring of its portfolio of _____________________________________________________________________________


commercial real estate loans secured by Eagle's hotel properties and related assets.

The loans, which mature in September 2012, were acquired by FRBNY from Bear Stearns as part of the United States government's acquisition of certain Bear Stearns' assets in JPMorgan Chase's takeover of Bear Stearns in 2008.

(D) Springleaf Finance

Springleaf Finance Corp., the subprime lender owned by Fortress Investment Group, has hired restructuring lawyers as it struggles to raise new funds and grapples with billions in debt coming due later this year.

Springleaf has hired law firm, Dewey & LeBouef, to restructure its business, a person close to the matter told Reuters.

Springleaf, previously owned by bailed-out insurer American International Group, provides loans, retail financing and other credit related products to customers.

(E) Hawker Beechcraft

According to reports, Hawker Beechcraft is readying a bankruptcy filing. On March 27, 2012, the manufacturer of business jets inked a forbearance agreement with lenders. Under the agreement, the lenders agree to defer until June 29, 2012, Hawker's obligations to make certain interest payments. The lenders also agree to a standstill with respect to Hawker's failure to satisfy financial covenants.

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The New York Times' DealBook says one of the options Hawker and its advisers are considering is a prearranged Chapter 11 filing that has the consent of those lenders, principally a number of hedge funds, said these people, who spoke on condition of anonymity. Among them are the hedge funds Centerbridge Partners and Angelo Gordon.

DealBook notes a Hawker bankruptcy would be put an end to a 2007 private equity deal that was troubled almost from the start. The company was formed when Goldman Sachs and Onex Partners, the largest private equity firm in Canada, bought Raytheon's private jet unit for $3.3 billion, hoping to seize on the fervor for private jets.

Hawker has hit rough times as the recession wiped out many discretionary expenditures like private jets.

As of Sept. 30, 2011, Hawker had more than $2 billion in long-term debt and $146.7 million in cash and short-term investments.

(F) Reddy Ice

Reddy Ice Holdings Inc., whose stock price plummeted after federal regulators opened an antitrust probe in 2008, said it may have to file a prepackaged bankruptcy plan if it can't slash its debt.

Reddy said it is negotiating with its stakeholders "to modify its capital structure and reduce the Company's leverage." If that effort isn't successful, it may have to file a prepackaged reorganization plan, it said in a filing.

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The Company said a “prepackaged” bankruptcy may provide the most expeditious manner in which to affect its plan of reorganization.

In a prepack, creditors vote on the plan before the Chapter 11 petition is filed.

Reddy Ice Holdings, Inc. is a manufacturer and distributor of packaged ice in the United States. It has 1,500 employees. The Company's balance sheet at Sept. 30, 2011, showed $460.94 million in total assets against $525.26 million in total liabilities.

(G) LightSquared Inc.

Harbinger Capital Partners' Phil Falcone said he is considering seeking bankruptcy protection for his wireless network company, LightSquared Inc.

A bankruptcy filing is "one of the options I am considering," the hedge fund manager said in an e-mail to Dow Jones Newswires, saying it's the "best way" for him to maintain control of the company. "Spectrum value does not decrease in bankruptcy," he said.

LightSquared is a company that plans to develop a wholesale 4G LTE wireless broadband communications network integrated with satellite coverage across the United States. But the plan hit a roadblock when the U.S. military and others complained that the planned service would disrupt global positioning system equipment.

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In addition to the challenged companies mentioned in Mr. Fernandez's report, the Troubled Company Reporter provides on-going reporting about more than 3,000 companies experiencing financial distress or restructuring their balance sheets in a judicial proceeding. Stay tuned to learn more about obtaining a trial subscription to the TCR at no cost or obligation.

Major Pending Disputes In Chapter 11 Cases

Next, we'll quickly review major pending disputes in large chapter 11 cases that Troubled Company Reporter editors monitor day-by-day.

Ivy Magdadaro provides updates in the various disputes Lehman Brothers is involved in.

As to the long-standing Lehman-JP Morgan Chase court fight, lawyers at the Justice Department said in a March 16 court filing that U.S. Treasury Secretary Timothy Geithner has agreed to provide answers to written questions from Lehman Brothers' creditors over allegations that JPMorgan illegally siphoned billions of dollars from Lehman in the days before the failed investment bank filed for the largest bankruptcy in the U.S. Mr. Geithner was the president of the Federal Reserve Bank of New York at the time of the Lehman collapse.

Lawyers for Lehman's creditors committee subpoenaed Mr. Geithner as well as then-Treasury Secretary Henry Paulson as part of its civil lawsuit against JPMorgan. Lehman and its creditors claim that JPMorgan Chief Executive Jamie Dimon and other top executives used insider knowledge to take advantage as Lehman's financial state worsened in the summer of 2008.

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Mr. Paulson has also reached a "general agreement" to answer the committee's questions in written form rather than through live testimony, according to court papers.

The Lehman committee says Mr. Geithner had more than 35 conversations with then-Lehman chief Richard Fuld and more than 10 with Mr. Dimon in the week before Lehman's Sept. 2008 bankruptcy filing. Lehman creditors believe some of those conversations concerned JPMorgan's calls for more collateral from Lehman -- a key element, the creditors argue, in the firm's collapse.

Lehman filed its lawsuit against JPMorgan in May 2010 to recover over $8.6 billion that JPMorgan allegedly seized as collateral. JPMorgan, which served as Lehman's clearing bank, countersued, claiming that Lehman tricked it into lending $70 billion shortly before the bankruptcy filing and left it with toxic and worthless securities.

In recent months, discovery has heated up in the Lehman-JPMorgan dispute with both sides issuing subpoenas. Lehman wants to question Min Euoo-sung, former chairman and chief executive of Korea Development Bank, a key potential bidder for Lehman weeks and months leading up to its bankruptcy, to testify under oath. Lehman claims JP Morgan sought to advise KDB with respect to the Lehman deal and its lawyers want to ask Min if JP Morgan may have learned that it wasn't going to bid for Lehman before that information became public, prompting the bank's call for more collateral. Meanwhile, lawyers for JP Morgan have sought to question former executives at Lehman's European subsidiary about the investment bank's decision-making process, including information about Lehman's infamous "goat poo," otherwise known as RACERS securities.

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In a recent related development, JP Morgan has agreed to pay $20 million to resolve the Commodity Futures Trading Commission's claims that it mishandled customer funds from Lehman Brothers from 2006 to 2008. JPMorgan settled the claims that it violated commodities laws with admitting or denying wrongdoing.

The CFTC said JP Morgan counted client money as belonging to the firm itself while extending loans that let Lehman bet on markets. The regulator noted that when Lehman filed for bankruptcy, JP Morgan refused to release the money for two weeks until CFTC officials insisted. JP Morgan said in a statement that the errors were unintentional and that it didn't use customer funds to meet any of Lehman's obligations.

As to the Archstone-related lawsuit, Lehman revised its complaint on the matter in early March. Lehman said its Archstone apartment company co-owners Bank of America Corp. and Barclays Plc "conspired" to try to sell their once-53% state in Archstone to competitor Sam Zell's Equity Residential. Lehman, which said it wants to take control of Archstone, asked a judge to make the banks honor an earlier agreement that would have allowed Lehman to pay about $1.3 billion for the stake. EQR on Feb. 21 said its minimum price would be $1.5 billion if it exercised an option to buy half of the banks' state. Lehman said the banks would be unjustly enriched if it was forced to match EQR's price for the remaining stake.

Meanwhile, appeals challenging Judge James Peck's decision over the 2008 sale of Lehman's broker unit to Barclays remain pending. The bankruptcy judge ordered Barclays to return $2 billion in margin assets to the Lehman broker unit trustee, James Giddens, and directed the trustee to give to the U.K. bank at least $1.1 billion, and possibly another $769 million in a reserve

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account. The appeals are to be decided by Judge Katherine Forrest.

Delayed Exits From Chapter 11

Julie Anne Lopez-Toledo reports about three Chapter 11 debtors whose emergence from Chapter 11 has been delayed: Nebraska Book, Tribune Co., and W.R. Grace.

(A) Nebraska Book

NBC Acquisition Corp. and its subsidiaries, including Nebraska Book Company, received approval to execute and implement an Amended and Restated Plan Support Agreement reflecting an agreement with a group of the Company's 10% senior secured noteholders holding roughly 70% of those notes and the Company's 8.625% senior subordinated noteholders holding over two-thirds of those notes in amount.

In exchange for their signing the PSA, 8.625% senior subordinated noteholders are expected to receive an improved package of warrants to purchase stock in the reorganized Company along with $1.75 million to cover fees incurred by their advisors. The holders of Class 5 General Unsecured Claims are expected to receive cash payments equal in value to the percentage recovery by the 8.625% senior subordinated noteholders.

The Company filed their original Plan Support Agreement on March 7 along with their Second Amended Plan of Reorganization and Disclosure Statement.

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Nebraska Book's junior creditors have objected to the deal with senior bondholders, saying the agreement locks the company into a "deeply flawed" Chapter 11 plan. Both the official committee of unsecured creditors and an ad hoc group of junior noteholders asked the Delaware bankruptcy court to reject the PSA.

Nebraska Book did not move forward with the original iteration of its prepackaged plan because it failed to obtain the required $250 million in outside financing. The plan would have paid off first-and second-lien debt in full while giving the new stock mostly to subordinated noteholders of the operating company and holders of notes issued by the holding company.

The new plan provides for these terms:

* Holders of the existing $200 million in second lien debt will receive new stock plus a new $100 million second-lien note. Second lien noteholders are projected to recover 81%

* Noteholders will backstop a new $80 million term loan to

finance the plan.

* Holders of $175 million in 8.625% subordinated notes will receive warrants for 5 percent of the new stock with an exercise priced based on a $100 million equity valuation. Subordinated noteholders can have warrants for another 5% of the new equity based on a $150 million equity valuation. The projected recovery on the subordinated notes is 1.5%.

* General unsecured creditors are offered 1.5% in cash.

* Existing shareholders and holders of $77 million in notes issued by the holding company are to receive nothing.

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The bankruptcy court scheduled an April 13 hearing to approve the disclosure statement explaining the plan.

Lincoln, Nebraska-based Nebraska Book Company, Inc., is one of the leading providers of new and used textbooks for college students in the United States. Nebraska Book and seven affiliates filed separate Chapter 11 petitions [Bankr. D. Del. Case Nos. 11-12002 to 11-12009] on June 27, 2011. Hon. Peter J. Walsh presides over the case. Lawyers at Kirkland & Ellis LLP and Pachulski Stang Ziehl & Jones LLP, serve as the Debtors' bankruptcy counsel. The Debtors; restructuring advisors are AlixPartners LLC; the investment bankers are Rothschild, Inc.; the auditors are Deloitte & Touche LLP; and the claims agent is Kurtzman Carson Consultants LLC. As of the Petition Date, the Debtors had consolidated assets of $657,215,757 and debts of $563,973,688.

JPMorgan Chase Bank N.A., as administrative agent for the DIP lenders, is represented by lawyers at Richards, Layton & Finger, P.A., and Simpson Thacher & Bartlett LLP. J.P. Morgan Investment Management Inc., the DIP arranger, is represented by lawyers at Bayard, P.A., and Willkie Farr & Gallagher LLP.

An ad hoc committee of holders of more than 50% of the Debtors' Second Lien Notes is represented by lawyers at Brown Rudnick. An ad hoc committee of holders of the Debtors' 8.625% unsecured notes are represented by Milbank, Tweed, Hadley & McCloy LLP.

The Official Committee of Unsecured Creditors selected Lowenstein Sandler LLP and Stevens & Lee, P.C., as lawyers and Mesirow Financial Inc. as financial advisers.

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(B) Tribune

Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware held hearings on March 5, and 6, 2012, with respect to several disputes that affect distributions under the Third Amended Joint Plan of Reorganization for Tribune Company and its debtor affiliates. The Court has yet to rule on the so-called Allocation Disputes.

On March 16, 2012, Tribune Company; the Official Committee of Unsecured Creditors; Oaktree Capital Management, L.P.; Angelo, Gordon & Co., L.P.; and JPMorgan Chase Bank, N.A. filed a modified Third Amended DCL Plan that assumes the Reorganized Debtors' Distributable Value at a range of $6.917 billion to $7.826 billion to $7.826 billion with an approximate mid-point of $7.372 billion.

The Third Amended Plan eliminates the Creditors' Trust, which was included in previous plans, and updates the Debtors' valuation and financial projections.

Judge Carey rescheduled the hearing to consider approval of the solicitation procedures and supplemental disclosure document for the Third Amended Joint Plan of Reorganization for Tribune Company and its debtor affiliates, from March 30, 2012,

to a later date to be determined.

The Court converted the March 30 hearing to a telephonic status conference only with respect to the Solicitation Procedures and Supplemental Disclosure Document.

Tribune Co., which owns the Chicago Tribune, Los Angeles Times, WGN Ch. 9 and many other media properties, has been in bankruptcy since Dec. 8, 2008.

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(C) W.R. Grace

Plan Proponents W.R. Grace & Co. and its debtor affiliates, the Official Committee of Equity Security Holders, the Official Committee of Asbestos-related Personal Injury Claimants, and the Future Claims Representative asked the U.S. District Court for the District of Delaware to make two limited and specific amendments to the memorandum opinion and order that Judge Ronald L. Buckwalter issued on January 30, 2012, affirming the Debtors' Joint Plan of Reorganization.

The Plan Proponents sought (1) an addition to the Affirmation Order to clarify that all the injunctions and releases in the Joint Plan, not just the injunction under Section 524(g) of the Bankruptcy Code, are approved, issued and affirmed; and (2) revisions to two paragraphs of the Memorandum Opinion to conform the opinion more closely to the language of the Joint Plan regarding jury trials.

The Libby Claimants said they agree with the Plan Proponents' motion to amend Judge Buckwalter's January 30, 2012 memorandum decision affirming the Debtors' Joint Plan.

Meanwhile, Judge Buckwalter granted the motions of Anderson Memorial Hospital and BNSF Railway Company for an extension of time to file a notice of appeal from his January 30 memorandum opinion.

Judge Buckwalter ruled that each and every party to the appeals will have 30 days to file a notice of appeal computed from the last date of the District Court's entry of an order regarding any of these motions:

-- Garlock Sealing Technologies LLC's motion for _____________________________________________________________________________


reargument, rehearing, and to alter or amend the judgment;

-- the Plan Proponents' motion to amend the memorandum opinion; and

-- the Joint Motion of Sealed Air Corporation, Cryovac, Inc., and Fresenius Medical Care Holdings, Inc. for order amending and clarifying Memorandum Opinion and Order.

Her Majesty the Queen in Right of Canada, and the Bank Lender Group, in separate notices, informed the U.S. District Court for the District of Delaware that they will take an appeal to the United States Court of Appeals for the Third Circuit from Judge Buckwalter's January 30 memorandum opinion and order.

Grace filed for Chapter 11 reorganization in 2001 to protect itself from more than 100,000 personal injury claims.

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The Troubled Company Reporter provides detailed reporting about every chapter 11 filing nationwide. Stay tuned to learn more about obtaining a trial subscription to the TCR at no cost or obligation.

New Publicly Traded Securities

Psyche Maricon Castillon reports about six companies that issued or will issue shares of new common stock upon emergence pursuant to the plans of reorganization they filed in their Chapter 11 cases in March 2012. These are: General _____________________________________________________________________________


Maritime, Ener1, Nebraska Book, Jobson Medical, Trailer Bridge, and TBS International.

(A) General Maritime

The U.S. Bankruptcy Court for the Southern District of New York has approved the disclosure statement filed in connection with General Maritime Corporation's proposed Joint Plan of Reorganization.

Approval of the Disclosure Statement allows General Maritime to solicit approval of the Plan from its creditors. The hearing to consider approval of the Plan by the Bankruptcy Court is scheduled to commence on April 25, 2012.

Under the Plan, the Company will receive an infusion of $175 million in new capital from funds managed by Oaktree Capital Management, L.P. The Plan also allows general unsecured creditors to participate in the new equity investment on the same economic terms as Oaktree through a rights offering. In addition, holders of general unsecured claims against General Maritime Corporation will receive their pro rata share of warrants to purchase 2.5% of the new equity of the reorganized Company.

Under the terms of the rights offering:

-- General unsecured creditors who are eligible to participate under applicable securities laws will have the ability to purchase up to 17.5% of the equity in the reorganized Company for $61.25 million, at a subscription price of $36.84 per share;

-- To the extent that the rights offering is not fully subscribed by general unsecured creditors, Oaktree is committed to purchase any unsubscribed rights;_____________________________________________________________________________


-- General unsecured creditors not eligible to participate in the rights offering will receive the cash equivalent of the right to participate in the offering, approximately equal to a 0.75% recovery on their unsecured claims;

-- To participate in the rights offering or to receive the cash equivalent, general unsecured creditors must return an investor certificate certifying whether or not they are qualified institutional buyers or accredited investors under applicable securities laws.

Following the completion of the restructuring process, General Maritime will continue to operate as a going concern and will reduce its funded indebtedness by approximately $600 million. The Plan is supported by Oaktree and the Company's banks, which together hold over two-thirds of the claims against the Company. The Company notes that discussions are ongoing with the Creditors' Committee and certain other holders of Senior Note Claims, and the Company is hopeful that consensus on the Plan will be reached.

(B) Ener1

The U.S. Bankruptcy Court signed an order approving Ener1's disclosure statement and procedures governing the solicitation of votes and order confirming the Debtor's Prepackaged Plan of Reorganization.

"The holding company will exit bankruptcy with new equity funding and a stronger balance sheet, and its operating subsidiaries will be better positioned to meet the demands of existing and potential customers in the energy storage industry," Alex Sorokin, interim C.E.O. of Ener1, said.

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The Plan provides for a restructuring of the Company's long-term debt and the infusion of up to $86 million of new equity funding, which will support the continued operation of Ener1's subsidiaries. In addition to the new equity funding, the holders of the existing senior notes, the convertible notes and a line of credit have agreed to restructure their debt in a partial debt-for-equity exchange. All of the current common stock will be cancelled when the Plan becomes effective, and new common and preferred stock will be issued to both the current note holders and in consideration of the new equity funding that will flow into the Company. Existing notes will be exchanged for a combination of cash, new equity and new notes.

(C) Nebraska Book

Nebraska Book Company filed with the U.S. Bankruptcy Court a Second Amended Chapter 11 Plan of Reorganization. The Court approved the Company's Disclosure Statement on August 22, 2011, so a related Disclosure Statement explaining the Second Amended Plan was not filed.

On February 24, 2012, the Debtors and Consenting Noteholders reached an agreement in principle on the terms of the Amended Plan. As part of the Amended Plan, the Debtors will receive $80 million in the form of a New Money First Lien Term Loan, fully backstopped by one of the largest Consenting Noteholders in dollar amount.

The Amended Plan provides, among other things, that (a) 100% of the equity in the reorganized Debtors, subject to dilution from a Management Equity Incentive Plan and Warrants, and (b) $100 million of New Second Lien Take-Back Notes, will be distributed on a pro rata basis to existing second lien noteholders.

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The Amended Plan also provides that (a) holders of 8.625% senior subordinated notes due 2012 (the '8.625% Notes') will receive warrants to purchase up to (i) 5.0% of the fully diluted new common equity in the form of 5-year warrants struck at an equity value of $100.0 million; and (ii) up to 5.0% of the fully diluted new common equity in the form of 5-year warrants struck at an equity value of $150.0 million, and (b) general unsecured creditors will receive cash payments that result in the same percentage recovery as the 8.625% Noteholders receive in Warrants."

(D) Jobson Medical

The U.S. Bankruptcy Court issued an order approving Jobson Medical Information Holdings' Disclosure Statement and concurrently confirming its Joint Prepackaged Plan of Reorganization, dated January 10, 2012. This privately-held health care information and marketing provider filed for Chapter 11 protection on February 2, 2012, listing $109 million in prepetition assets.

The Plan gives the company three more years to pay off its loan and grants its secured lender equity in the new company. Under the Plan, maturity of first-lien debt will be extended by three years and the lenders owed $117.4 million will be given 20% of the equity. Unsecured creditors with claims totaling about $2 million will be paid in full. The Plan allows the Class A shareholders to retain 80% of the new stock. The existing Class B shareholders retain nothing.

(E) Trailer Bridge

Trailer Bridge filed with the U.S. Bankruptcy Court Second Amended Chapter 11 Plan of Reorganization. According to the _____________________________________________________________________________


Plan's Disclosure Statement, "On the Effective Date, the Reorganized Debtor will obtain new financing in the approximate amount of $[30] million. Funds from the exit facility will be used to satisfy the DIP Facility Claims, support other payments required to be made under the Plan, pay transaction costs, and fund working capital and other general corporate purposes of the Reorganized Debtor following the Effective Date. The Corporate Governance Documents of the Reorganized Debtor will provide for the authorization of and issuance of New Common Stock in the Reorganized Debtor to the holders of Allowed Noteholder Deficiency Claims which will be subject to dilution based upon the issuance of New Common Stock issued pursuant to any New Management Incentive Plan as set forth in Article IV of the Plan, and Allowed Old Common Interests."

(F) TBS International

The U.S. Bankruptcy Court confirmed TBS International's Plan of Reorganization. The Plan reflects overwhelming support from its voting lenders to restructure the Company's secured debt and to pay in full in cash all allowed claims of unsecured creditors, including all vendors. As a result, the reorganized Company will emerge from its pre-packaged restructuring with approximately $40.0 million in new money financing provided by its existing lenders.

Upon emergence, the reorganized Company will have reduced its debt by over $100 million since September 30, 2011. Under the Plan, the D.I.P. financing claims and pre-petition secured debt will be restructured so as to provide new liquidity, extended maturity dates and other terms that are expected to ensure the Company's future viability. Pursuant to the Plan, ownership of the Company's operating subsidiaries will be transferred to a newly-formed entity that will be owned principally _____________________________________________________________________________


by the Company's lenders. The Company's current equity holders will receive no distributions under the Plan, and the Company will cease to be a reporting public company.

* * *

That ends the Beard Group Corporate Restructuring Review for March 2012, brought to you by the editors of the Troubled Company Reporter and Troubled Company Prospector. If you'd like to receive the Troubled Company Reporter for 30-days at no cost -- and with no strings attached -- call Nina Novak at (240) 629-3300 or visit bankrupt-dot-com-slash-free-trial and we'll add you to the distribution list. That telephone number, again, is (240) 629-3300 and that Web site address, again, is bankrupt-dot-com-slash-free-trial.

Tune in to our next monthly Restructuring Review on May 16th. Thank you for listening.

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beard corporate restructuring review for march 2012

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