UPDATE 1-Fisker seeks rejection of Chinese suitor it blames for its bankruptcy

Thu Jan 2, 2014 3:53pm EST

* Unsolicited suitor Wanxiang allegedly contributed to bankruptcy

* Fisker urges court to approve sale to Hong Kong's Richard Li entity

* Judge to consider Li, Wanxiang plans Jan. 10

By Tom Hals

Jan 2 (Reuters) - Fisker Automotive, the bankrupt maker of a plug-in hybrid sports car, asked a federal judge to approve its proposed sale to a Hong Kong tycoon rather than a Chinese suitor that Fisker alleged was to blame for its failure.

A courtroom showdown is set for Jan. 10 that will determine the future of the defunct car maker, which was launched with a controversial U.S. government loan. U.S. Bankruptcy Court Judge Kevin Gross must decide if Fisker's business will be put to open auction or sold to an affiliate of Richard Li as the company has proposed.

The hearing was originally scheduled for Friday, but was postponed one week as a major snowstorm threatened to disrupt travel throughout the eastern United States.

The company's plans were thrown into doubt on Monday, when the official creditors' committee proposed auctioning the business and presented an initial $24.725 million bid from the U.S. unit of Wanxiang Group, China's top auto parts company.

Fisker attacked the creditors' proposal in a series of court filings on Wednesday with the bankruptcy court in Wilmington, Delaware, noting that after Wanxiang bought A123 Systems Inc, a battery maker, it cut supplies to Fisker.

"Wanxiang now seeks to profit from a bankruptcy that it helped cause," Fisker said in a filing.

An attorney for the creditors' committee disputed that, noting that Wanxiang acquired A123 months after Fisker idled its production to save cash. "Fisker was no longer producing cars at that time," said Sunni Beville, of law firm Brown Rudnick.

The creditors' committee has called the Wanxiang bid proposal the best option. It also asked the bankruptcy court to allow it to sue to former Fisker director David Manion and others for improperly pushing the sale to Li.

Hanging in the balance are the assets of a company once touted as America's "green" rival to prestigious brands such as Maserati, but that has not made its signature Karma vehicle in more than a year.

The company obtained a $529 million loan from the Department of Energy that was meant to promote fuel-efficient cars, which in turn helped to lure private backing.

Fisker raised more than $1.4 billion in public and private funds after its founding in 2007. But lavish spending, quality and engineering blunders and other mistakes drained the company's coffers and delayed the launch of the Karma, several people close to the company told Reuters earlier this year.

An entity affiliated with Li planned to buy Fisker after he paid $25 million for Fisker's government loan, outbidding Wanxiang. Instead of using cash, the Li affiliate planned to buy Fisker's assets using a "credit bid" of a portion of what Fisker owed on that loan, leaving other creditors with next to nothing.

Court records show that a majority of unsecured creditors such as design consultants and suppliers voted to reject the plan to sell Fisker to Li.

The case is In re Fisker Automotive Holdings Inc, U.S. Bankruptcy Court, District of Delaware, No. 13-13087.

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Brazil's Oleo e Gas says to honor oil field debts

SAO PAULO Thu Jan 2, 2014 6:04pm EST

SAO PAULO Jan 2(Reuters) - Brazilian entrepreneur Eike Batista's Oleo e Gas Participacoes SA promised in a securities filing on Thursday to honor its debts in two offshore oil fields with the financial resources it obtained from an agreement with creditors last week.

QGEP Participações SA, Oleo e Gas's partner, said on Monday that the company, formerly known as OGX, could lose its 40 percent stake in the Atlanta and Oliva fields in Brazil's Santos Basin if it fails to pay its share of development costs.

Brazilian oil regulator ANP ordered Oleo e Gas to show that its financial obligations in the fields, part of the BS-4 offshore concession, were up to date.

"The company provided initial clarifications to the ANP about that notification," Oleo e Gas said in the filing. "The installments in overdue capital in BS-4 will be duly honored under the terms agreed on by the parties involved, including with the new resources from the agreement with bondholders."

Oleo e Gas, which filed Latin America's largest-ever bankruptcy protection petition on Oct. 30, owes partners QGEP and Barra Energia do Brasil Petróleo e Gas 73 million reais ($31.2 million).

QGEP and Barra each own 30 percent of the fields south of Rio de Janeiro. The first horizontal production well in Atlanta is expected to start producing in January.

Failure to meet financial commitments related to oil exploration and production concessions can result in the loss of those concessions under Brazilian law.

0leo E Gas Participacoes said it had reached a deal with the majority of holders in a total of $3.8 billion in bonds in a statement released on Dec. 24.

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UPDATE 3--Spain's Codere in debt talks to avoid insolvency

Thu Jan 2, 2014 7:37pm EST

MADRID Jan 2 (Reuters) - Spanish gaming group Codere said on Thursday it is seeking protection from creditors and starting talks to avoid insolvency, after struggling to keep up with debt payments in recent months because of higher tax bills and other costs.

The company is the latest in Spanish to run into trouble even as the country slowly emerges from recession, with bankruptcies handled in court in 2013 up 15 percent from the year before, according to official data.

Codere's problems, however, stem mainly from its overseas businesses. The company blamed its cash shortage on the closure of several gaming outlets in Mexico, license renewal costs in Argentina and tax increases in various countries.

Codere had 1.27 billion euros ($1.73 billion) of debt at the end of last September, according to company filings, including three bond issues and other loans. It has up to four months to reach a deal with banks and investors.

The loss-making company made several late payments on bond coupons in recent months as it tried to win time to restructure its debts. It warned on Thursday that it may be unable to repay a 127 million euro loan due on Jan. 5 if it does not first reach an agreement with lenders.

International private equity firm Blackstone Group LP , through its credit arm GSO Capital Partners, and hedge fund Canyon Capital LLC are among investors that have bought up Codere debt in recent months.

The two U.S. firms gave the company extra credit lines to tide it over and help it pay coupons.

Codere has become a prominent example of how the opaque market for credit default swaps (CDS) can drive creditors to influence a company's debt payment schedule rather than just hedge their bets on its debt.

In September 2013, Codere made an intentional late coupon payment on $300 million of its bonds that allowed it to gain consent from its creditors, which traded on CDS, to push back the debt maturities of a 100 million euro ($137 million) loan package.

By then, GSO and Canyon were investors in that loan, snapping up the debt in the open market earlier that year. The two debt fund managers also lent Codere 35 million euros to make its delayed coupon payment.

Blackstone was an investor in Codere's CDS while Canyon was not, according to a person briefed on the matter who was not authorized to discuss the matter publicly. GSO and Canyon declined to comment.

Sources close to Codere's debt talks have said bondholder debts could be cut by half in a debt-for-equity swap.

Codere posted a 93 million euro loss for the first nine months of 2013. Its core profit of 172.3 million euros, or earnings before interest, taxes, depreciation and amortization (EBITDA), was down nearly 27 percent from the year before.

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China's largest auto parts company makes last-minute Fisker bid

By Tom Hals

Tue Dec 31, 2013 9:55am EST

Dec 31 (Reuters) - China's largest auto parts company made a surprise bid for Fisker Automotive just days before the bankrupt maker of the Karma plug-in hybrid sports car was to be sold to a Hong Kong tycoon, according to court documents.

Fisker creditors asked the U.S. Bankruptcy Court in Wilmington, Delaware to scrap Fisker's agreed sale to a company affiliated with Richard Li and instead hold an open auction at which Wanxiang America Corp plans to bid.

Wanxiang outbid Johnson Controls last year in a bankruptcy auction for most of the assets of A123 Systems Inc, which made batteries for Fisker's cars.

"They are extremely capable and knowledgeable of the industry and know how to get things done," said William Baldiga, a Brown Rudnick attorney who represents Fisker's official creditors committee.

Both Fisker and A123 obtained green technology loans from the Department of Energy. Critics of the government's loan program tried to get regulators to block the sale of A123 to Wanxiang, arguing that sensitive technology was being transferred to an economic rival.

Baldiga said he does not anticipate similar problems with the sale of Fisker's assets, which he said are primarily related to automotive design.

Wanxiang plans to restart Fisker production and eventually move the manufacturing from Finland to Michigan, according to Wanxiang's presentation to creditors that was filed with the court.

Fisker filed for bankruptcy in November, after being hobbled by production glitches and recalls.

Li planned to buy the company after he paid around $30 million for Fisker's loan from the U.S. government. Li planned to bid the $168 million owed on that loan to acquire Fisker's assets, leaving other creditors such as suppliers with next to nothing.

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UPDATE 1-China's largest auto parts company makes last-minute Fisker bid

Tue Dec 31, 2013 1:02pm EST

* Creditors back auction with China's Wanxiang as bidder

* Creditors seek permission to sue former Fisker directors

* Hearing on Friday may decide future of Fisker

By Tom Hals

Dec 31 (Reuters) - China's largest auto parts company made a surprise bid for Fisker Automotive just days before the bankrupt maker of the Karma plug-in hybrid sports car was to be sold to a Hong Kong tycoon, according to court documents.

Fisker creditors asked the U.S. Bankruptcy Court in Wilmington, Delaware, to scrap Fisker's agreed sale to a company affiliated with Richard Li and instead hold an open auction at which auto parts supplier Wanxiang America Corp plans to bid.

Wanxiang has agreed to make an initial bid of $24.725 million and said it will assume some liabilities of Fisker, according to documents filed at late Monday's deadline to object to Fisker's plans.

A hearing has been scheduled for Friday in Wilmington to consider whether Fisker should proceed with the sale to the Li affiliate or adopt the creditors' proposal.

The U.S. Bankruptcy Court judge overseeing the case, Kevin Gross, earlier this month raised concerns about Fisker's rush through bankruptcy, which was filed only a month ago.

James Sprayregen, a Kirkland & Ellis attorney who represents Fisker, did not immediately respond to a request for comment left with his office.

Wanxiang outbid Johnson Controls last year in a bankruptcy auction for most of the assets of A123 Systems Inc, which made batteries for Fisker's cars.

"They are extremely capable and knowledgeable of the industry and know how to get things done," said William Baldiga, a Brown Rudnick attorney who represents Fisker's official creditors committee.

Both Fisker and A123 obtained green technology loans from the U.S. Department of Energy. Critics of the government's loan program tried to get regulators to block the sale of A123 to Wanxiang, arguing that sensitive technology was being transferred to an economic rival.

Baldiga said he does not anticipate similar problems with the sale of Fisker's assets, which he said are primarily related to automotive design.

Wanxiang plans to restart Fisker production as soon as April and eventually move the manufacturing from Finland to Michigan, according to Wanxiang's presentation to creditors that was filed with the court.

The Chinese company estimated it would sell more than 1,000 Karma hybrids in the first 18 months in the United States and 500 in Europe. Fisker sold the Karma for more than $100,000 each. Wanxiang said in its presentation it could lower production costs, but did not suggest a price tag.

Fisker filed for bankruptcy in November, about a year after suspending production.

Fisker raised more than $1.4 billion in public and private funds after its founding in 2007, but lavish spending, quality and engineering blunders and other mistakes drained the company's coffers and delayed the launch of its Karma plug-in hybrid, several people close to the company told Reuters earlier this year.

An entity affiliated with Li planned to buy the company after he paid $25 million for Fisker's loan from the U.S. government. The Li affiliate planned to buy Fisker's assets using not cash but a "credit bid" of $168 million owed on that loan, leaving other creditors such as suppliers with next to nothing.

The committee proposed an auction be held at the end of January and asked the bankruptcy court to bar Li's affiliate from credit bidding more than the $25 million it paid for the government's loan.

In addition to seeking an auction of Fisker's assets, the creditors' committee asked Gross, the Bankruptcy Court judge, for permission to sue former Fisker directors Li and David Manion, as well as Fisker co-founder Bernhard Koehler.

The committee alleges they steered the company away from a proposed sale to Wanxiang earlier this year and toward the plan to buy the government's loan. The creditors are seeking damages of at least $25 million.

The creditors allegations follow a complaint filed Friday in Delaware federal court by Atlas Capital Management LP that accused the car maker's founder, Henrik Fisker, and others of failing to disclose the company's shaky finances to investors.

The creditors' committee also sought to put the government loan now held by Li's affiliate at the back of the line for repayment because the scheme by Li and Manion had harmed other Fisker creditors.

"As a proximate result of Manion's breaches of fiduciary duty as alleged, the valuable assets of Fisker have been or will be stripped from the Debtors for the benefit of Manion, with a minimum value of $25 million," said the committee complaint.

The case is In Re Fisker Automotive Holdings Inc, U.S. Bankruptcy Court, District of Delaware, No. 13-13087

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CORRECTED-Ex-chair of bankrupt Dewey law firm tapped as a top UAE legal adviser

Tue Dec 31, 2013 6:34pm EST

(Corrects title in headline to "ex-chair")

By Casey Sullivan

NEW YORK Dec 31 (Reuters) - The former head of defunct New York law firm Dewey & LeBoeuf has become the top legal adviser to the government of Ras al Khaimah, according to an internal government memo.

Steven Davis, who was blamed by some of his former Dewey colleagues for mismanaging the law firm by giving outsize pay guarantees to lawyers, will be chief legal officer of the Middle East government, according to the memo reviewed by Reuters on Tuesday. Ras al Khaimah is one of the United Arab Emirates and is ruled by Sheik Saud bin Saqr Al Qasimi.

The memo, which was signed by executive committee chairman of the Ras al Khaimah's Investment and Development Office Salem Ali Al Sharhan on Dec. 8, also said Davis would assume the role of CEO of the IDO.

A request for comment to Davis was not immediately returned. Contacts for the Ras al Khaimah government could not immediately be reached.

Dewey & LeBoeuf, the law firm Davis chaired, was one of the United States' largest and most profitable law firms and served as lead adviser on high profile matters including the bankruptcy and sale of the Los Angeles Dodgers.

In May 2012, it became the largest law firm to file for bankruptcy in U.S. history. Its demise has widely been attributed to a high number of pay guarantees that the firm's management gave to top-ranking partners, according to lawyers who worked at the firm and legal experts.

Davis is an energy lawyer and served as the head of Dewey & LeBoeuf since it was formed in 2007 through the merger of Dewey Ballantine and LeBoeuf Lamb Greene & MacRae.

In April, Davis agreed to pay $511,145 as part of a settlement releasing him from mismanagement claims by the trustee recovering money on behalf of the estate of the failed firm.

A year earlier, the Manhattan district attorney's office launched an investigation into Davis and his alleged financial mismanagement of the firm. Davis has denied wrongdoing. As of April this year, sources had told Reuters the investigation was ongoing. A Manhattan DA office spokeswoman declined to comment on Tuesday about the status of the investigation.

Davis's appointment was earlier reported by The Wall Street Journal. (Reporting by Casey Sullivan; Editing by Ted Botha and Ken Wills)

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China's largest auto parts company makes last-minute Fisker bid

By Tom Hals

Tue Dec 31, 2013 9:55am EST

Dec 31 (Reuters) - China's largest auto parts company made a surprise bid for Fisker Automotive just days before the bankrupt maker of the Karma plug-in hybrid sports car was to be sold to a Hong Kong tycoon, according to court documents.

Fisker creditors asked the U.S. Bankruptcy Court in Wilmington, Delaware to scrap Fisker's agreed sale to a company affiliated with Richard Li and instead hold an open auction at which Wanxiang America Corp plans to bid.

Wanxiang outbid Johnson Controls last year in a bankruptcy auction for most of the assets of A123 Systems Inc, which made batteries for Fisker's cars.

"They are extremely capable and knowledgeable of the industry and know how to get things done," said William Baldiga, a Brown Rudnick attorney who represents Fisker's official creditors committee.

Both Fisker and A123 obtained green technology loans from the Department of Energy. Critics of the government's loan program tried to get regulators to block the sale of A123 to Wanxiang, arguing that sensitive technology was being transferred to an economic rival.

Baldiga said he does not anticipate similar problems with the sale of Fisker's assets, which he said are primarily related to automotive design.

Wanxiang plans to restart Fisker production and eventually move the manufacturing from Finland to Michigan, according to Wanxiang's presentation to creditors that was filed with the court.

Fisker filed for bankruptcy in November, after being hobbled by production glitches and recalls.

Li planned to buy the company after he paid around $30 million for Fisker's loan from the U.S. government. Li planned to bid the $168 million owed on that loan to acquire Fisker's assets, leaving other creditors such as suppliers with next to nothing.

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UPDATE 1-China's largest auto parts company makes last-minute Fisker bid

Tue Dec 31, 2013 1:02pm EST

* Creditors back auction with China's Wanxiang as bidder

* Creditors seek permission to sue former Fisker directors

* Hearing on Friday may decide future of Fisker

By Tom Hals

Dec 31 (Reuters) - China's largest auto parts company made a surprise bid for Fisker Automotive just days before the bankrupt maker of the Karma plug-in hybrid sports car was to be sold to a Hong Kong tycoon, according to court documents.

Fisker creditors asked the U.S. Bankruptcy Court in Wilmington, Delaware, to scrap Fisker's agreed sale to a company affiliated with Richard Li and instead hold an open auction at which auto parts supplier Wanxiang America Corp plans to bid.

Wanxiang has agreed to make an initial bid of $24.725 million and said it will assume some liabilities of Fisker, according to documents filed at late Monday's deadline to object to Fisker's plans.

A hearing has been scheduled for Friday in Wilmington to consider whether Fisker should proceed with the sale to the Li affiliate or adopt the creditors' proposal.

The U.S. Bankruptcy Court judge overseeing the case, Kevin Gross, earlier this month raised concerns about Fisker's rush through bankruptcy, which was filed only a month ago.

James Sprayregen, a Kirkland & Ellis attorney who represents Fisker, did not immediately respond to a request for comment left with his office.

Wanxiang outbid Johnson Controls last year in a bankruptcy auction for most of the assets of A123 Systems Inc, which made batteries for Fisker's cars.

"They are extremely capable and knowledgeable of the industry and know how to get things done," said William Baldiga, a Brown Rudnick attorney who represents Fisker's official creditors committee.

Both Fisker and A123 obtained green technology loans from the U.S. Department of Energy. Critics of the government's loan program tried to get regulators to block the sale of A123 to Wanxiang, arguing that sensitive technology was being transferred to an economic rival.

Baldiga said he does not anticipate similar problems with the sale of Fisker's assets, which he said are primarily related to automotive design.

Wanxiang plans to restart Fisker production as soon as April and eventually move the manufacturing from Finland to Michigan, according to Wanxiang's presentation to creditors that was filed with the court.

The Chinese company estimated it would sell more than 1,000 Karma hybrids in the first 18 months in the United States and 500 in Europe. Fisker sold the Karma for more than $100,000 each. Wanxiang said in its presentation it could lower production costs, but did not suggest a price tag.

Fisker filed for bankruptcy in November, about a year after suspending production.

Fisker raised more than $1.4 billion in public and private funds after its founding in 2007, but lavish spending, quality and engineering blunders and other mistakes drained the company's coffers and delayed the launch of its Karma plug-in hybrid, several people close to the company told Reuters earlier this year.

An entity affiliated with Li planned to buy the company after he paid $25 million for Fisker's loan from the U.S. government. The Li affiliate planned to buy Fisker's assets using not cash but a "credit bid" of $168 million owed on that loan, leaving other creditors such as suppliers with next to nothing.

The committee proposed an auction be held at the end of January and asked the bankruptcy court to bar Li's affiliate from credit bidding more than the $25 million it paid for the government's loan.

In addition to seeking an auction of Fisker's assets, the creditors' committee asked Gross, the Bankruptcy Court judge, for permission to sue former Fisker directors Li and David Manion, as well as Fisker co-founder Bernhard Koehler.

The committee alleges they steered the company away from a proposed sale to Wanxiang earlier this year and toward the plan to buy the government's loan. The creditors are seeking damages of at least $25 million.

The creditors allegations follow a complaint filed Friday in Delaware federal court by Atlas Capital Management LP that accused the car maker's founder, Henrik Fisker, and others of failing to disclose the company's shaky finances to investors.

The creditors' committee also sought to put the government loan now held by Li's affiliate at the back of the line for repayment because the scheme by Li and Manion had harmed other Fisker creditors.

"As a proximate result of Manion's breaches of fiduciary duty as alleged, the valuable assets of Fisker have been or will be stripped from the Debtors for the benefit of Manion, with a minimum value of $25 million," said the committee complaint.

The case is In Re Fisker Automotive Holdings Inc, U.S. Bankruptcy Court, District of Delaware, No. 13-13087

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CORRECTED-Ex-chair of bankrupt Dewey law firm tapped as a top UAE legal adviser

Tue Dec 31, 2013 6:34pm EST

(Corrects title in headline to "ex-chair")

By Casey Sullivan

NEW YORK Dec 31 (Reuters) - The former head of defunct New York law firm Dewey & LeBoeuf has become the top legal adviser to the government of Ras al Khaimah, according to an internal government memo.

Steven Davis, who was blamed by some of his former Dewey colleagues for mismanaging the law firm by giving outsize pay guarantees to lawyers, will be chief legal officer of the Middle East government, according to the memo reviewed by Reuters on Tuesday. Ras al Khaimah is one of the United Arab Emirates and is ruled by Sheik Saud bin Saqr Al Qasimi.

The memo, which was signed by executive committee chairman of the Ras al Khaimah's Investment and Development Office Salem Ali Al Sharhan on Dec. 8, also said Davis would assume the role of CEO of the IDO.

A request for comment to Davis was not immediately returned. Contacts for the Ras al Khaimah government could not immediately be reached.

Dewey & LeBoeuf, the law firm Davis chaired, was one of the United States' largest and most profitable law firms and served as lead adviser on high profile matters including the bankruptcy and sale of the Los Angeles Dodgers.

In May 2012, it became the largest law firm to file for bankruptcy in U.S. history. Its demise has widely been attributed to a high number of pay guarantees that the firm's management gave to top-ranking partners, according to lawyers who worked at the firm and legal experts.

Davis is an energy lawyer and served as the head of Dewey & LeBoeuf since it was formed in 2007 through the merger of Dewey Ballantine and LeBoeuf Lamb Greene & MacRae.

In April, Davis agreed to pay $511,145 as part of a settlement releasing him from mismanagement claims by the trustee recovering money on behalf of the estate of the failed firm.

A year earlier, the Manhattan district attorney's office launched an investigation into Davis and his alleged financial mismanagement of the firm. Davis has denied wrongdoing. As of April this year, sources had told Reuters the investigation was ongoing. A Manhattan DA office spokeswoman declined to comment on Tuesday about the status of the investigation.

Davis's appointment was earlier reported by The Wall Street Journal. (Reporting by Casey Sullivan; Editing by Ted Botha and Ken Wills)

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Detroit mediators ask judge to approve swaps deal

By Joseph Lichterman

DETROIT Mon Dec 30, 2013 2:50pm EST

DETROIT Dec 30 (Reuters) - The mediators who oversaw negotiations between Detroit and two banks to strike a deal to end a costly interest-rate swap agreement recommended on Monday that the judge in charge of Detroit's bankruptcy approve the agreement, arguing the deal is a critical first step toward resolving the historic case.

The city struck a deal with UBS AG and Bank of America Corp's Merrill Lynch Capital Services on Dec. 24 to end the interest-rate swap agreements at a 43 percent discount. The negotiations happened after U.S. Bankruptcy Judge Steven Rhodes, who is overseeing the case, encouraged Detroit to negotiate better terms for the deal.

Rhodes still must approve the agreement and he will hold a hearing on Jan. 3 to consider the arrangement.

In a document filed with the bankruptcy court on Monday, U.S. District Judge Gerald Rosen and U.S. Bankruptcy Judge Elizabeth Perris, two of the mediators in the case, recommended that Rhodes sign off on the deal because it is in the interest of both the banks and the city.

"As is the case in almost all settlements in bankruptcy (or indeed, in most litigation), this settlement, and the Mediators' recommendation of it, can best be captured and characterized by the admonition, 'Do not allow the perfect to become the enemy of the good,'" they wrote.

"Although it is not a perfect settlement, the mediators believe ... it represents a fair and equitable solution that is advantageous to all concerned."

Detroit will pay $165 million, plus up to $4.2 million in costs, to end the interest-rate swap agreements that were supposed to hedge interest rate risk for some of the $1.4 billion in pension debt that the city sold in 2005 and 2006.

Initially, the city landed a $350 million loan from Barclays Plc and planned to use about $230 million to end the swaps with Merrill and UBS at a 25 percent discount.

Detroit will now take out a $285 million loan from Barclays to end the swaps. About $120 million of the loan will be used to improve city services.

Despite the mediators' recommendation, the deal still faces opposition from some city creditors, including Detroit's two pension funds. In an email last week, attorney Robert Gordon, who represents the funds, said they will continue to oppose the deal because "the revised deal is better, but that is not saying a lot."

Detroit, which is weighed down by $18.5 billion in debt, filed the largest municipal bankruptcy in U.S. history in July. Earlier this month Rhodes declared the city eligible for bankruptcy and Detroit Emergency Manager Kevyn Orr has said he plans to submit an initial plan to restructure Detroit's debt to the bankruptcy court in early January.

The two mediators characterized the swaps deal as a "significant first step" in resolving the city's case.

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