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Prommis Holdings LLC, which provides processing services for defaults and foreclosures in the residential mortgage industry, sought chapter 11 protection from creditors yesterday, Bloomberg News reported. The Atlanta-based company listed debt of more than $50 million and assets of as much as $50 million in chapter 11 documents filed yesterday. Ten affiliates also filed for bankruptcy. The company said in the filing that it plans to sell virtually all its assets in a court-supervised auction. No terms were disclosed. The case is In re Prommis Holdings LLC, 13-10551, U.S. Bankruptcy Court, District of Delaware (Wilmington).

Executives in control of Edison International's Edison Mission Energy—its struggling wholesale-power unit that filed for bankruptcy in December—are still drafting an agreement that would transfer ownership of its more than 40 electricity-generating facilities to bondholders who extended $3.7 billion to the unit, Dow Jones Daily Bankruptcy Review reported today. Edison Mission attorneys said that their progress so far includes drafting a bonus plan for executives and all 47 senior managers to reward them for keeping operating costs down and minimizing unplanned outages at its power plants, according to court papers.

Rotech Healthcare Inc., a provider of home respiratory products, said that it will file to restructure through a pre-prepackaged chapter 11 plan, Bloomberg News reported on Friday. Under the proposed restructuring, Rotech's $290 million in 10.5 percent second-lien notes due in 2018 would be converted to equity; holders of a $23.5 million term loan would be paid in full and the $230 million of 10.75 percent first-lien notes would be amended and the maturity potentially extended, Rotech said. Orlando-based Rotech's predecessor company also filed for chapter 11 protection in 2000, along with its then-parent, Integrated Health Services, and was spun-off in 2002 as a separate entity, it said at the time.

Hostess Brands Inc. is defending the upcoming sales of its various bakery businesses against the objections of its bakers union and others, arguing that the deals are its only viable option, Dow Jones Daily Bankruptcy Review reported today. In a court filing on Thursday, Hostess said that four objections remain to the sales of its top brands, including Wonder bread and Twinkies, which a judge will consider at a hearing this week. (Subscription required.)

Directories publishers Dex One Corp. and SuperMedia Inc. have filed for bankruptcy after failing to win the full support of senior secured lenders for a change to a credit agreement that was needed to complete their planned merger, Reuters reported today. Dex One, formerly known as R.H. Donnelley Corp., and SuperMedia agreed last year to combine their businesses, with Dex One shareholders expected to own about 60 percent and SuperMedia shareholders the rest of the combined company. Dex One has assets and liabilities both in the range of about $2.8 billion, while SuperMedia has total assets of $1.4 billion and total debt of $1.9 billion, according to the filing.

The U.S. Trustee Tracy Hope Davis has objected to American Airlines CEO Tom Horton's $19.8 million severance payment, arguing that the company has not explained why such a large sum is permissible under federal bankruptcy rules, the Fort Worth Star-Telegram reported yesterday. Horton's compensation is addressed as part of the company's merger agreement with US Airways, which calls for Horton to become chairman of the combined company until its first shareholders meeting, expected in mid-2014. US Airways CEO Doug Parker will be chief executive of the combined carrier. Bankruptcy Judge Sean Lane is scheduled to rule on the merger and Horton's severance package at a March 27 hearing. In the filing made on Friday, Davis said that "a severance payment of close to $20 million defeats Congress' intent" when it put restrictions on such compensation. Those rules, Davis argues, limit payments to current employees to not more than 10 times the average of similar payments to nonmanagement employees, except in special circumstances.

Patriot Coal Corp. has asked a court to terminate about $1.6 billion in retiree health benefits for thousands of its unionized U.S. mine workers as part of its plan to survive chapter 11, Reuters reported today. Patriot said that the United Mine Workers of America's labor costs are not competitive with other coal producers that operate "under more flexible work rules and a significantly lower labor cost structure." As an alternative to terminating retiree health benefits, Patriot has proposed creating a trust, known as a Voluntary Employee Beneficiary Association, that includes profit sharing of up to a maximum of $300 million and an initial cash contribution of $15 million.

Suntech Power Holdings Co., the Chinese solar-panel maker that announced a forbearance agreement for $541 million in convertible debt due tomorrow, fell to a record low after Maxim Group LLP said the company is "likely" to default and enter bankruptcy, Bloomberg News reported yesterday. Suntech tumbled 22 percent to 65 cents at the close in New York, the lowest since it began trading in December 2005. The bonds increased to 32 cents on the dollar. The company said in a statement on March 11 that about 60 percent of the bondholders had agreed to wait until May 15 before exercising their rights. A default would be the first for a bond issued by a company in mainland China. Suntech, the largest solar panel maker in 2011, has reported losses for the past two years and had about $2 billion of debt as of the end of August, according to a bondholder presentation in November filed with the Securities and Exchange Commission.

A Portland, Ore.-based law firm has been able to pay its bills and emerge from Chapter 11 bankruptcy after settling a big case, the ABA Journal reported yesterday. The same prolonged legal battle with Pfizer Inc. that forced Williams Love O'Leary & Powers to file for bankruptcy in 2011 also resulted in a settlement sufficient to pay its bills, although exact terms of the settlement reached last year are confidential. The case against the pharmaceutical giant concerned 500 women who said that they developed cancer as a result of hormone replacement therapy. Pursuing Pfizer cost the law firm some $3 million.

Bankruptcy Judge Kevin Carey said yesterday that A123 Systems Inc.'s unsecured creditors can begin voting on the failed battery maker's liquidation plan that proposes to pay them about 65 cents on the dollar, but offers no repayment of some $133 million worth of government-funded grants, Dow Jones Daily Bankruptcy Review reported today. A123 filed for bankruptcy in October and sold its automotive battery business for $256.6 million to Wanxiang America, a subsidiary of China's Wanxiang Group, at a bankruptcy court auction.