There is more bad news for Realogy, Carl Ichan is precipitating them into bankruptcy:

Market Scan Icahn Cries Foul On Realogy's Debt Deal Melinda Peer, 12.03.08, 07:00 PM EST

The activist investor's firm is suing the real estate company, saying its exchange violates agreements. Real estate brokerage Realogy sought to skirt defaults on some of its bonds by launching a debt exchange but Carl Icahn's venture-capital firm, High River, threw a wrench in its plans by slapping Realogy with a lawsuit and accusing it of delaying the inevitable. High River, which owns some of Realogy's senior bonds, alleges the repayment of its securities would be unfairly delayed under the debt deal announced last month since it may give new debtholders certain benefits such as moving them up on the repayment list if Realogy goes bankrupt.

Article Controls imageemail imageprint imagereprint imagenewsletter imagecomments imageshare imagedel.icio.us imageDigg It! imageyahoo imageFacebook imagerss Yahoo! Buzz Realogy, which owns brokerages Century 21, ERA, Coldwell Banker, and Sotheby's planned to exchange $1.1 billion worth of bonds for new securities of roughly half of their value under the offering. The company is owned by Leon Black's private-equity firm, Apollo Management, which acquired the sucessor company to Cendant for $9.0 billion two years ago. (See "Apollo Gets Realogy.") In a filing with the Securities and Exchange Commission dated Tuewsday, the real estate company said as of the close of business on Nov. 26, it had received $237.1 million total aggregate principal amount of commitments for the second-lien incremental term loans, which will be due in 2014 and 2015.

If no other commitments are received, the company's outstanding debt would be reduced to $286.0 million, upon fulfilling the invitations, the filing said. The filing also mentions the litigation brought by High River, which alleged the new loans breach terms of Realogy's senior toggle notes contract. "The company believes that the allegations contained in the complaint are without merit and intends to vigorously defend this action," Realogy said in the filing, adding that it believes the incurrence of the new loans are allowed under the senior toggle note contract and credit agreements. Interestingly, the filing says that Bank of New York Mellon, the trustee charged with monitoring the notes, last month told Realogy that it did not think the offer complies with the terms of the securities.

It wasn't clear if the objection was the same one that Icahn made, and the filing did not say if Realogy replied or if it disagreed. Comment On This Story Icahn, who considers his fellow billionaire Black a friend, downplayed personal aspects of the lawsuit during a television interview. The activist investor said that given current market conditions, bankruptcies are unavoidable and that companies aren't helping anyone by prolonging the inevitable.