Palm Harbor Homes (fka PHHMQ)

[Stock]

Deletion time: 12:17:37

Plan of Bankruptcy effective. All shares have been cancelled. Deletion time:12:17:37 **

[Renee]

PHHMQ Plan of BK effective. All shares cancelled.

http://www.otcbb.com/asp/dailylist_detail.asp?d=12/12/2011&mkt_ctg=NON-OTCBB

[owl-embers]

Cakeman, I'm curious about what settings your scan had that brought PHHMQ up. What is your DD showing?

[Cakeman28]

HMM This just popped up on my stock scanner.....I will do some DD

[56Chevy]

Thats very interesting. If there was zero chance of this recovering, why would Capital Southwest Corp and Sally Possy still hold their shares?

On the surface it's always tempting to think that if major shareholders haven't sold then there is hope for equity. It's a common misconception on Ihub. Their reasons for buy, sell or hold are often times far different from us retail trader/investors. In the case of CALCQ the major shareholder(s) (owning a combined 53% of the co) were also Major league Creditors. They wrote off (mentally and financially) their equity holdings almost the day after the company filed CH 11. Why? Because their sole focus shifts to recovery of the debt. That becomes Job #1. Those same shareholding creditors often times will vote for a POR that will cancel the equity if that POR is most benefitial to getting their loaned money back. They write off their equity holdings almost immediately. In their minds it's 100% gone.

I don't know if that's the case here but the point is just because major shareholders are "holding" doesn't really indicate it's a good idea for small retailer's to do the same. Another way to think of it is- They aren't "holding" the shares as much as they've been "abandoned". Make sense?

On the other hand if you see major holders forming equity committees and actively working to restore equity in a company...that's a different kettle of fish! buy buy buy.

[owl-embers]

thanks for the information. Doesnt look so good. We shall see next month.

[cosmicschool]

Just read the blog below - This could be the reason why they haven't sold the shares for a "Loss" yet...

"CSWC owns significant equity positions in four publicly traded companies(Alamo Group Inc., Encore Wire Corporation, Palm Harbor Homes, Inc., and Heelys,Inc.). Although CSWC has held these stakes for many years, it has chosen not to exercise its registration rights with respect to these securities and,therefore, it values these stakes at significant discounts (generally 30% or more) to their end-of-quarter market prices. Further, as a result of its affiliate's status, the failure to register the shares does not permit CSWC to sell a significant portion of its position when market conditions warrant"

http://seekingalpha.com/article/44914-capital-southwest-ned-sherwood-discloses-6-6-stake-wants-company-liquidated

[cosmicschool]

They don't have to SELL FOR A LOSS. They might be holding on to their shares so that, once the SALE IS COMPLETE and the Company has been OFFICIALLY DECLARED BANKRUPT by the Judge and there the EQUITY has been EXTINGUISHED, they can file a "Tax Loss" in 2011 by making the value of the Equity/Common Shares ZERO CENTS.

So just don't believe that there is a value left based on the fact that these two common shares holders still hold their shares.

If there is indeed value left for Common Shares, why would the company WARN or provide MISLEADING information that "It is likely that the Equity will be Extinguished"???

I don't think we can even speculate about what is "Likely to happen" after March 1 2011.

Cheers!

[owl-embers]

Capital Southwest Corp and the Trustee of the Founder's wife Sally Possy still own their 34% and 19% of Common Stock.

Thats very interesting. If there was zero chance of this recovering, why would Capital Southwest Corp and Sally Possy still hold their shares?

Things arent looking good for equity holders with the information we have right now and yet the two major share holders not selling could maybe mean there is information we arent privy to yet that could possibly work in our favor?

[56Chevy]

$155M debt to creditors...$57M sale of assets in an auction = $0 equity.

[cosmicschool]

The paragraph below is taken from the article below:
"Moreover, the distribution of Palm Harbor's shares ensures the alignment of the directors with the company's shareholders. Approximately 52% of our outstanding common stock is beneficially owned or controlled by Sally Posey and Capital Southwest (our largest investor). Capital Southwest holds two seats on our board, and the trustee of Posey's trust is a director. Any influence Keener wields on the board based on his role as chairman is sufficiently countered by the large concentration of our shares with a few shareholders"

http://www.forbes.com/lists/2010/19/risk-list-2-10_Palm-Harbor-Homes_6C10.html

[cosmicschool]

Check out the Form 4 and SC 13G/A filed after PHHM filed for Bankruptcy. The last 2 months has seen some LONG TERM HOLDERS bailing out. At the same time, there is a silver lining too. Capital Southwest Corp and the Trustee of the Founder's wife Sally Possy still own their 34% and 19% of Common Stock.

In Sum, THIS SEEMS TO BE A HIGH RISK PROPOSITION and only folks who ACTUALLY CAN GAMBLE will invest here as the chance of LOSING everything is definitely there, considering that they are in Chapter 11 and are going to sell the company pursuant to Section 363.

weigh the risk and rewards carefully before you decide to "Take the plunge"


http://www.otcmarkets.com/stock/PHHMQ/financials

Cheers!

[cosmicschool]

Absolutely and that is one reason in my previous post, i mentioned "It could pan out either way".

But here is the most important thing - The NT-10Q was filed after the 8k (Feb 1 2011) i.e 7 days later on Feb 7 2011.

The 8k gives a "little hope" but what if the value left for the "Common Share holders" is just 4-5 cents/share??

Also, why did "Insiders" Sell?? The Chief Financial officer sold nearly 60,000 plus shares and so did one of the board of directors sell nearly 108K shares. Why would they sell if there "Was a possibility of Value" to the Equity.

And the latest filing dated yesterday shows that T. Rowe Price Associates too reduced their holding from over 5% to 1.3% - Why would they "Take a Loss" if there is value for the "Common Stock".

Yes, it might be "Worth Gambling" i.e investing in Palm Harbor at this point of time, just 2 weeks before the auction ONLY IF YOU HAVE MONEY THAT YOU CAN DEFINITELY AFFORD TO LOSE.

Cheers!

[owl-embers]

from the recent 8-K, "holders of common equity would likely not be entitled to receive any recovery on account of their equity until all such Liabilities are first paid."

its a small window I admit but isnt this sentence admitting the possibility that ONCE liabilities are first paid, shareholder recovery is indeed something that can happen??

[cosmicschool]

It could pan out either way but unfortunately, the latest filings on pinksheets (8K and NT-10Q) seems to point out "Extinguishment of Equity" at No VALUE..

Delineated below are CONTENTS from their NT-10Q filed nn February 7 2011.

http://www.otcmarkets.com/stock/PHHMQ/financials

PART III
NARRATIVE

As previously disclosed, on November 29, 2010 (the "Petition Date"), Palm Harbor Homes, Inc. (the "Company") and certain of its domestic subsidiaries (collectively, the "Debtors") filed a voluntary petition for relief under Chapter 11 of Title 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware in Wilmington (the "Bankruptcy Court"). The Company has been advised by Ernst & Young LLP ("E&Y"), the Company's independent public accountants, that E&Y will not be able to commence its review of the Company's quarterly financial information to be included in the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended December 24, 2010 (the "Form 10-Q") until it is formally retained pursuant to an order of the Bankruptcy Court. As a result, E&Y has informed the Company that the earliest that E&Y will be able to commence its review is February 18, 2011. Accordingly, it is highly unlikely that the Company will be able to file the Form 10-Q, which was required to be filed on February 7, 2011, prior to the sale of the Company pursuant to an auction to be conducted by the Bankruptcy Court which is currently scheduled to occur on March 1, 2011.

As previously disclosed, as of January 31, 2011, the Company projects that it will have approximately $155 million of debt (both pre-petition and post petition, the "Liabilities") by the time the auction concludes and the sale closes. Accordingly, assuming that strict payment priorities under the bankruptcy code are applied to distribution of the sale proceeds (and that some or all of such Liabilities are not otherwise assumed by the successful purchaser) holders of common equity would likely not be entitled to receive any recovery on account of their equity until all such Liabilities are first paid. At present, the Company's "stalking horse" purchaser has submitted a bid under its asset purchase agreement of approximately $50 million plus the assumption of certain obligations. The auction is scheduled to occur on March 1, 2011. Accordingly, following the sale, it is likely that the Company's current equity will be extinguished for no value. For the reasons stated above, the Form 10-Q may not be filed prior to any extinguishment of the Company's equity interests. Once the Company no longer has any outstanding equity securities, it will seek to suspend its obligation to file periodic reports with the Securities and Exchange Commission.

On February 2, 2011, the Debtors filed a Form 8-K with the Securities and Exchange Commission that included the monthly operating report for the period from November 30, 2010 to December 24, 2010 which the Debtors had filed with the Bankruptcy Court on January 28, 2011.

[56Chevy]

Superfly15- Thanx for the heads up. I'm not in this but for those who are I'm sure they're asking this question in regard to the offer by Cavco to purchase:

In a BK (PHHMQ) if someone wants to buy the company..what happens to equity (shareholders)?

Generally speaking, "absolute priority" rules under Chapter 7. Cash generated will be used to pay off creditors. Any excess cash would belong to equity. If the result is a small number, cash would be distributed. Larger amounts could lead to Chapter 11.

The number one mission/goal of the Bankruptcy courts in our country is to recover as much of the Creditors interest as possible...NOT the shareholders interest's. I have not looked at Palm Harbor's liabilities to it's creditors but I bet a coffee & donut the offer Cavco made would not leave anything for equity. ??

[owl-embers]

If Cavco buys Palm Harbor, is there still hope that the PHHM stock will survive or would that be an automatic death of the PHHM stock?

[Superfly15]

Cavco seeking to buy Palm Harbor
3 commentsby Betty Beard - Jan. 28, 2011 02:39 PMThe Arizona Republic
.

Even as manufactured-home sales continue at their lowest levels in about 50 years nationwide, Phoenix-based Cavco Industries Inc. is attempting to grow more by buying another one of its rivals.

Cavco in August 2009 bought one of its largest competitors, Fleetwood Enterprises Inc., out of Bankruptcy Court for $26.6 million and now is attempting to buy Dallas-based Palm Harbor Homes Inc., for $57.5 million.

Palm Harbor filed for bankruptcy reorganization in November, and the purchase would be subject to an auction and court approval. The company's products are sold in Arizona and it has a manufacturing plant in Tempe.



Read more: http://www.azcentral.com/business/articles/2011/01/28/20110128cavco-seeking-buy-palm-harbor.html#ixzz1DQVZstym

[owl-embers]

Things coming alive here

[56Chevy]

Case Info for PACER-

U.S. Bankruptcy Court
District of Delaware (Delaware)
Bankruptcy Petition #: 10-13850-CSS

Assigned to: Judge Christopher S. Sontchi
Chapter 11
Voluntary
Asset

Date filed: 11/29/2010

Debtor
Palm Harbor Homes, Inc.
15303 Dallas Parkway
Addison, TX 75001
Tax ID / EIN: 59-1036634

[56Chevy]

Phase 1 of a BK is typically not a good time to get in.

[56Chevy]

New symbol PHHMQ

[NYPharmer1]

Chevy, I have been watching this come down but with nothing to show for it going back up...just the BK.

[56Chevy]

Anyone following PACER on this BK?

http://finance.boston.com/boston/news/read?GUID=15773172

[owl-embers]

There seems to be the potential for both a huge pop from here or a sudden death. The link provided on this board has a disclaimer at the end saying: SHORT so wouldnt that make that person's opinion a bit biased? Just curious to hear other's opinions of this stock. Looks like a very interesting near future upside might be in the works.

[otcbbtrader1]

http://seekingalpha.com/instablog/767919-boss-vip/117502-palm-harbor-homes-inc-home-sweet-home-under-chapter-11-attack-pearl-harbor

[$tockfather]

WOW! I don't think I've ever seen so many deliberate bid whacks by MM's. All them 100/200/300 share bid whacks didn't stop all day. This was major manipulation by MM's to drive the PPS down.

Every large sized ask slap was followed by 100 share bid whacks.lol

I wonder what the current short interest is for PHHM???

This may see a huge pop up very soon.IMO

[Mister_Profit]

Bad manipulation here going on with institutions and mms. DONT PLAY THIS unless you have some insider information! You have been warned.

[Mister_Profit]

WOW that was just wrong!

[hang ten]

Well, they're going into a voluntary chap 11; looks like they have $50m in DIP financing.. Beyond that I'd like to some financials to get a better idea, the last couple of ideas might've just been a bounce so I'll keep an eye on it..

[Mister_Profit]

Yes, I did a look and saw there was no board so I just opened it. What is going to happen here with this?

[Mister_Profit]

Anyone know what is going on here with the fast rise? They filed chapter 11 BR but yet the stock price shoots up like crazy? Is this some kind of super wallstreet pump and dump or is there real value to this?

[hang ten]

Palm Harbor Homes Files for Chapter 11 to Provide Liquidity

Press Release Source: Palm Harbor Homes, Inc. On Monday November 29, 2010, 3:09 pm EST

DALLAS--(BUSINESS WIRE)-- Palm Harbor Homes, Inc. (NASDAQ:PHHM - News) today announced that it and five of its domestic subsidiaries, Palm Harbor Manufacturing L.P., Palm Harbor Albemarle L.L.C., Palm Harbor Real Estate L.L.C., Palm Harbor GenPar L.L.C. and Nationwide Homes Inc. (collectively the “Company”), filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The Company is taking this action to provide liquidity and partner with Fleetwood Homes, Inc., a subsidiary of Cavco Industries, Inc. (NASDAQ:CVCO - News) through a sale process pursuant to Section 363 of the Bankruptcy Code in order to support ongoing operations.



In conjunction with the filing, the Company has received a commitment of $50 million, which may increase to $55 million if certain conditions are met, for a debtor-in-possession (DIP) credit facility from Fleetwood Homes that will be used to extinguish all obligations due on the existing Textron Financial Corporation facility and fund post-petition operations, commitments to customers, and employee obligations.



“Prolonged poor industry conditions have depleted the liquidity of Palm Harbor Homes despite management’s ongoing efforts to improve and scale back operations as prudent and restructure our existing debt. Over the last several months, we have a conducted a thorough process to identify the best capital partner for our Company,” said Larry H. Keener, chairman, president and chief executive officer of Palm Harbor Homes.



“Management and the Board have decided that the Chapter 11 process is the best alternative available for all stakeholders and provides us with the most timely and orderly means to recapitalize our Company. In support of this decision, we are pleased to announce our commitment for Debtor-In-Possession financing with Fleetwood Homes to provide us the liquidity runway to participate in a court approved 363 auction process to seek the highest recovery for our various stakeholders,” added Keener.



Fleetwood Homes, Inc. is owned by Cavco Industries, Inc. and Third Avenue Value Fund (TAVFX). Third Avenue Management, the investment advisor to TAVFX, is a New York-based company with expertise in value and distressed investing. A subsidiary of Fleetwood Homes, Inc. will be the stalking horse bidder for the assets and certain warranty and other liabilities of the Company.



Palm Harbor Homes’ affiliates, Standard Casualty Company, Standard Insurance Agency, Palm Harbor Insurance Agency and CountryPlace Acceptance Corp., were not included in and their operations will not be impacted by the filing. These entities will, however, be included in the merger that results from the auction process.



Joseph H. Stegmayer, chairman, president & chief executive officer of Cavco Industries, Inc. added, “We are pleased to have this opportunity to partner with Palm Harbor Homes and look forward to a successful outcome of this process. Our mutual intention is to help Palm Harbor continue its heritage of providing quality home building, retailing, finance availability, competitive insurance products and outstanding customer service. Our combined businesses will have a strengthened foundation and market presence.”



The Company emphasized that daily operations are expected to continue uninterrupted throughout the restructuring. The Company filed approximately 20 “first-day motions” covering the continuation of employee programs and business operations, as well as its post-petition DIP financing, the continuation of supplier payments, customer contract and warranty programs, retailer rebate programs, and other case administration matters. The Company anticipates that these first-day motions will be heard this week. Pursuant to the relief requested in those motions, homes will be sold, manufactured and delivered as normal, employees will be paid and will continue to receive the same benefits as before the filing and all customer contracts and warranties will be honored.



“Despite the current challenges in our core markets, we still believe there are considerable opportunities in the factory-built construction industry in the future,” said Keener. “We fully expect to proceed through this restructuring swiftly and continue designing and manufacturing high quality products for our retailers, builders and developers.”



The Company filed its voluntary petitions in the U.S. Bankruptcy Court for the District of Delaware in Wilmington.



For further information please contact the Company’s toll-free information line at 1-888-220-3896 or visit the Company’s restructuring website at www.restructure.palmharbor.com.



The Company’s legal advisor is Locke Lord Bissell & Liddell; its financial advisor is Raymond James & Associates and its restructuring advisor is Alvarez & Marsal.



The Company also announced today that it has appointed Brian Cejka of Alvarez & Marsal as its Chief Restructuring Officer. Mr. Cejka will report to the Company’s Chief Executive Officer.



About Palm Harbor Homes, Inc.



Dallas, Texas-based Palm Harbor Homes is one of the nation's leading manufacturers and marketers of factory-built homes. The Company markets nationwide through vertically integrated operations, encompassing manufacturing, marketing, financing and insurance. For more information, please visit www.palmharborhomes.com.

[hang ten]

Was just about to start a board.. lol

[Iron Maiden]

Picked up some tickets at 0.289