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Note 15 - Subsequent Events
9 Months Ended
Sep. 30, 2014
Subsequent Events [Abstract]  
Subsequent Events [Text Block]

Note 15. Subsequent Events


Under ASC 852, Reorganizations, fresh-start accounting is required upon emergence from Chapter 11 if (i) the value of the assets of the emerging entity immediately before the date of confirmation is less than the total of all post-petition liabilities and allowed claims; and (ii) holders of existing voting shares immediately before confirmation receive less than 50% of the voting shares of the emerging entity.


The value of the assets of the Company immediately before the date of confirmation is expected to be less than the total of all post-petition liabilities and allowed claims.  Additionally, the holders of the existing voting shares immediately before the Effective Date held less than 50% of the voting shares of the emerging entity.


On the Effective Date, the company successfully emerged from bankruptcy with its exit financing being in place. The Company will adopt fresh-start accounting as of the Effective Date. Adopting fresh-start accounting results in a new reporting entity with no beginning retained earnings or deficit. The cancellation of all existing shares outstanding on the Effective Date and issuance of new shares of the reorganized entity caused a related change of control of the Company under ASC 852. Fresh-start accounting also requires that the reporting entity allocate the reorganization value to its assets and liabilities in relation to their fair values upon emergence from Chapter 11. The Company is in the process of evaluating the potential impact of the fresh-start accounting on its consolidated financial statements. The Company’s financial advisor performed a valuation of the reorganized Company dated as of July 15, 2014.  According to the valuation, which was included in the Disclosure Statement related to the Plan, the post-confirmation estimated enterprise value of the Company to be in a range between $850 million and $950 million. Given the approximately $225 million of debt projected to be on the balance sheet of the Company under the Exit Financing Facility on the Effective Date, the implied equity value of the Company was estimated at approximately $625 million to $725 million. As further described in Notes 1 and 14 above, on the Effective Date, the Company cancelled its existing equity interests, issued 37,500,000 new shares of common stock to its existing equity holders and lenders under its Credit Agreement, and established a new management incentive program.