The Ticker

Airline merger approved

AMR Corp., the bankrupt parent of American Airlines, has received court approval to merge with US Airways Group Inc. and create the world's largest airline.

But one clause in the merger agreement, a nearly $20 million severance package for AMR's outgoing CEO Tom Horton, was not approved by a judge at a hearing in U.S. Bankruptcy Court in Manhattan.

SF tower aims high

Boston Properties and Hines have broken ground on the Transbay Tower in San Francisco, which will be the nation's seventh largest tower at 1,070 feet tall. The building will consist of 60 levels of office space in a 1.4 million square foot complex.

Construction is expected to begin this summer and be completed in 2016.

Lexington co. secures investment

SynapDx Corp. has secured a significant yet undisclosed investment from The Kraft Group that will support the ongoing clinical development of the company's blood-based autism spectrum disorder diagnostic test. The test is designed to help clinicians identify children with autism earlier than they do today.

T-Mobile takes bite of Apple

T-Mobile will become the first major wireless company to sell Apple's popular iPhone 5 without a contract requirement on April 12. Preorders will be accepted starting April 5. T-Mobile will sell the device for $99, plus the monthly cost of using the phone.

TODAY

 The Commerce Department releases fourth-quarter gross domestic product.

TOMORROW

 U.S. stock markets closed for Good Friday.

 The Commerce Department releases personal income and spending for February.

L Former U.S. Sen. Scott Brown, left, is joining Boston-based CoachUp as a senior advisor on its advisory board. Boston Bruins President Cam Neely is joining the startup's board of directors.

L Atlantic Power has named Edward Hall as executive vice president and chief operating officer. Hall previously served as executive vice president and COO Global Generation at power company AES Corp.

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Groundbreaking set at former Herald site

The Boston Herald's former longtime South End headquarters will be feted next month before crews start demolition for its next life as the "Ink Block," a 471-unit apartment complex anchored by a Whole Foods supermarket.

Newton-based National Development's plans for the April 11 groundbreaking ceremony will include a strong Herald presence.

Mayor Thomas M. Menino will remove a symbolic brick from the building for preservation, and Herald columnist Joe Fitzgerald will share memories of the paper's home base of 54 years before it moved to a more modern newsroom and offices in the Seaport District last year.

Herald publisher and owner Patrick J. Purcell sold the former 6.6-acre Herald site to National Development in 2007 for undisclosed terms. He retained a minority stake in the $200 million redevelopment, which also will include stores and restaurants and link the South End with Chinatown and the rest of the city.

"We're going to start taking the building down," said Ted Tye, managing partner of National Development. "We've been in predemolition now for several months, taking things out of the building."

In 2011, the Herald signed a 10-year lease for its new headquarters on Fargo Street, where it occupies two floors in the rapidly growing South Boston waterfront area.

Purcell said he's excited about the new quarters and how the newspaper has been evolving with both its print and online editions, and through video.

"And I'm really excited about what the development of the former Herald building will mean for the South End community," 
he said.

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$un shining on Third Rock fund

Hub-based venture capital firm Third Rock Ventures, LLC, has closed its third fund and is ready to put the money toward its intended purpose — supporting innovative health-care companies.

Third Rock partner Kevin Starr said the $516 million fund will help start 15 to 16 new companies, with a bias toward those that will be based in the Boston area.

He said the new fund will target "big ideas" companies.

"It's more about making a major impact on severe diseases," Starr told the Herald. "It's not about me-too drugs. We're looking to make a truly meaningful impact on major diseases."

Starr said a recent example was Third Rock's decision to fund Lotus Tissue Repair, which creates innovative treatments for dystrophic epidermolysis bullosa. The rare disease's victims, often referred to as "butterfly children" because their skin is as fragile as butterfly's wings, suffer from birth from a painful condition in which the top layer of their skin is so fragile that everyday activities such as eating or going to the bathroom can cause severe injuries to their skin and organs.

Lotus Tissue Repair created a unique drug that is injected monthly to help butterfly children lead more normal lives, Starr said.

"Our investors are happy, but what makes us happy is that we can help these kids with this horrible disorder," Starr said.

He added that Third Rock Ventures, which previously closed funds of $378 million and $428 million, is not yet thinking about a fourth fund, since it will be busy launching companies from the third fund for the next few years. He said most of the companies will be based in the Hub, since promoting innovative health care in Boston is a major goal of the fund.

"If you make a big difference for patients, the economic benefits follow," Starr said.

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Senate’s bank vote may be symbolic slap

After the Senate's symbolic crackdown on too-big-to-fail banks in the final hours before Congress adjourned over the weekend, experts were divided about how effective such legislation would be, with the industry threatening to pass any costs along to customers.

The Senate voted 99-0 for a non-binding measure to end implicit subsidies the largest banks receive from the credit markets due to the perception that the government would bail them out — an issue raised by Massachusetts Sen. Elizabeth Warren during a recent hearing on Capitol Hill. Federal Reserve Chairman Ben Bernanke told Warren that the Dodd-Frank financial reform law provided a way to "unwind" big banks that failed.

Banking analyst Louis Harvey told the Herald that any additional costs imposed by Congress on big banks would ultimately be transferred to customers in the form of fees and interest rates.

"These actions (by lawmakers) may correct an unlevel playing field (between large and small banks) but make it more expensive for everyone to do business," said Harvey, president of Boston-based Dalbar, Inc.

But Deirdre Cummings of the Massachusetts Public Interest Research Group called that a familiar — and exaggerated — refrain.

"It's the standard reply we hear every time there's a proposed change," Cummings said. "The reality is ... the impact on consumers is not as dire as predicted."

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Study: Mass. life science initiative creating jobs

BOSTON — Midway through Massachusetts' ambitious 10-year, $1 billion life science initiative, the state is already reaping benefits.

That's the finding of a new study by Northeastern University economists Barry Bluestone and Alan Clayton-Matthews.

The report found that after 5 years and more than $300 million in investments, Massachusetts has overtaken all competitor states in its rate of life sciences job creation.

The analysis found the state made $301 million in investments between June 2008 and June 2012, including more than $186 million for capital projects and nearly $57 million in tax incentives to companies that meet specific hiring goals.

By June 30, 2012, those companies had created 2,537 new jobs.

The report also concluded that investments in startup companies are a strong draw to Massachusetts for larger companies.

Gov. Deval Patrick signed the bill into law in 2008.

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Yahoo buys startup run by 17-year-old entrepreneur

SAN FRANCISCO — A London startup owned by a 17-year-old entrepreneur has Yahoo as a buyer.

The teenager was seeking an easier way to read news stories and other content on the smaller screens of smartphones, so he built an app for that.

The deal announced Monday is Yahoo's fifth small acquisition in the past five months. It's part of CEO Marissa Mayer's effort to attract more engineers with expertise in building services for smartphones and tablet computers, an area of technology that she believed the Internet company had been neglecting.

Yahoo didn't disclose how much it is paying for Summly.

Founder Nick D'Aloisio began working on the app at his London home when he was 15. He's younger than Yahoo, which was incorporated in March 1995.

D'Aloisio said Summly will no longer be available, but the technology will return in other Yahoo products.

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Restaurateur has his plate full with Hub community projects

Restaurateur and developer Darryl Settles has seen many of the Hub's ups and downs since he came here as a Digital Equipment Corp. engineer three decades ago — before he took over the landmark nightclub Bob the Chef's, now Darryl's Corner Bar and Kitchen, and built his reputation as a successful Boston businessman.

Drawing on his experience reviving Bob the Chef's and developing other projects in the Hub, Settles sees his new joint venture with the Winn Cos., dubbed WiSe Urban Development, as a way for property owners to upgrade their residential units at a time when credit is tight following the housing crash.

"This is innovative in terms of what the joint venture is doing by working with nonprofits and partnering with them," Settles told the Herald, during an interview at his Faneuil Hall office. "In the old days, when things were great, a nonprofit could go to a bank and say, 'Hey, I have 200 units or 150 units that I want to redevelop, help me out,' and the bigger banks would say, 'sure.' That was their community thing to do because everybody was making so much money. But since the crash, it's been tough for nonprofits and community development corporations."

In addition to his work as a developer, Settles is known as the early force behind the Beantown Jazz Festival and the South End's Beehive restaurant. He recognized the value of live music venues when he took DEC clients to Turner Fisheries in the Westin.

"They had live entertainment and I went there often with customers and they always thought it was the coolest thing to do," said Settles. "That place was packed every night."

Settles' success has also made him a go-to person when civic leaders want to take the pulse of the minority business community. He has recently served on committees to help select the new Newton police chief and pick developers for two new convention center hotels in Boston.

He's also hosting a forum tonight at Darryl's on the "Status of Minority Businesses in Massachusetts and the USA" featuring Ron Marlow, the Patrick administration's assistant secretary for access and opportunity; Ron Walker, president and managing partner of Next Street; and Beth Williams, CEO of Roxbury Technology Corporation.

Settles said it's still challenging for minority business owners to secure the resources they need — and he has been helped by partnerships along the way.

WiSe has several projects under way, including the 96-unit Washington Park in Roxbury and Dorchester and 430 more units of housing in Connecticut and Massachusetts.

Married with two young children and with business booming, Settles has his hands full, but as he turns 52 this month, he's also thinking a lot about helping the next generation.

"When you travel you realize that America is one of the best places in the world to be, if not the best place and how we're fortunate," Settles said. "But even so, I understand and accept and acknowledge that it's difficult here in the states and the gap is getting wider and wider between those that have and those that do not, and I'm doing whatever I can to bridge that gap and give (people) access to opportunities."

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Cyprus secures bailout, avoids bankruptcy

BRUSSELS — Cyprus avoided bankruptcy, and potential turmoil across the eurozone, by securing a last-minute 10 billion euro ($13 billion) bailout with promises to sharply cut back its oversized banking sector and make large bank account holders take losses to help pay much of the bill.

Negotiations into early Monday ended with approval of the deal by the 17-nation eurozone's finance ministers. The European Central Bank had threatened to cut off crucial emergency assistance to the country's banks by Tuesday if no agreement was reached.

Without a bailout deal by Monday night, the tiny Mediterranean nation would have faced the prospect of bankruptcy, which could have forced it to become the first country to abandon the euro currency. That would have sent the region's markets spinning.

"It's not that we won a battle, but we really have avoided a disastrous exit from the eurozone," said Cyprus' Finance Minister Michalis Sarris.

The eurozone finance ministers accepted the plan after hours of negotiations in Brussels between Cypriot officials and the so-called troika of creditors — the International Monetary Fund, the European Commission and the ECB.

"We believe that this will form a lasting, durable and fully financed solution," said IMF chief Christine Lagarde.

To secure the rescue loan package, the Cypriot government had to find ways to raise 5.8 billion euros ($7.5 billion) on its own. The bulk of that money is now being raised by forcing losses on large bank deposit holders, with the remainder coming from tax increases and privatizations.

Cyprus must drastically shrink its banking sector, cut its budget, implement structural reforms and privatize state assets, said Jeroen Dijsselbloem, who chairs the meetings of the eurozone's finance ministers. The country's second-largest bank, Laiki, will be restructured, with all bond holders and people with more than 100,000 euros in their bank accounts there facing significant losses.

The measures are likely to deepen the recession in Cyprus.

The cash-strapped island nation has been shut out of international markets for almost two years. It first applied for a bailout to recapitalize its ailing lenders and keep the government afloat last June, but the political negotiations stalled. After a botched agreement last week, the European Central Bank threatened to cut off emergency assistance to the country's banks.

"We've put an end to the uncertainty that has affected Cyprus and the euro area over the past week," Dijsselbloem said.

That uncertainty around the tiny nation of about 800,000 had shaken the entire eurozone of 300 million people, even though Cyprus only makes up less than 0.2 percent of the eurozone's economy.

Several national parliaments in eurozone countries such as Germany must also approve the bailout deal, which might take another few weeks. EU officials said they expect the whole program to be approved by mid-April.

The country's second-largest bank, Laiki, will be dissolved immediately into a bad bank containing its uninsured deposits and toxic assets, with the guaranteed deposits being transferred to the nation's biggest lender, Bank of Cyprus.

Dijsselbloem said it was not yet clear how severe the losses would be to Laiki's large bank deposit holders, but he noted that it is expected to yield 4.2 billion euros overall — or much of the money that Cyprus needed to raise to secure the bailout. Analysts have estimated investors might lose up to 40 percent of their money.

Large deposits with Bank of Cyprus above the insured level will be frozen until it becomes clear whether or to what extent they will also be forced to take losses, the Eurogroup of finance ministers said in a statement.

Dijsselbloem defended the creditors' approach of making deposit holders take heavy losses, saying the measures "will be concentrated where the problems are, in the large banks."

The international creditors, led by the IMF, were seeking a fundamental restructuring of the country's outsized financial system, which is worth up to eight times the Cypriot gross domestic product of about 18 billion euros. They said the country's business model of attracting foreign investors, among them many Russians, with low taxes and lax financial regulation had backfired and needed to be upended.

The drastic shrinking of the financial sector, the wiping out of wealth through the losses on deposits, the loss of confidence with the recent turmoil and the upcoming austerity measures all mean that Cyprus is facing tough times.

"The near future will be very difficult for the country and its people," acknowledged the EU Commission's top economic official, Olli Rehn. "But (the measures) will be necessary for the Cypriot people to rebuild their economy on a new basis."

Cypriot banks have been closed this past week while officials worked on a rescue plan, and they are not due to reopen until Tuesday. Cash has been available through ATMs, but long lines formed and many machines have quickly run out of cash.

Amid fears of a banking collapse, Cyprus' central bank on Sunday imposed a daily withdrawal limit of 100 euros ($130) from ATMs of the country's two largest banks to prevent a bank run by depositors worried about their savings.

The Cypriot government also approved a set of laws over the past week to introduce capital controls, in order to avoid a huge depositor flight once banks reopen.

Creditors had insisted that Cyprus couldn't receive more loans because that would make its debt burden unsustainably high. The IMF's Lagarde said Cyprus would now reach a debt level of about 100 percent of GDP by 2020.

A plan agreed to in marathon negotiations earlier this month called for a one-time levy on all bank depositors in Cypriot banks. But the proposal ignited fierce anger because it also targeted small savers. It failed to win a single vote in the Cypriot Parliament.

Cyprus' bid to secure more financial aid from its long-time ally, Russia, then failed, forcing it to turn again to its European partners. Russia was expected, however, to extend a 2.5 billion euro emergency loan granted last year, also lowering the interest rate due and extending then repayment schedule.

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Associated Press writers Elena Becatoros and Menelaos Hadjicostis in Nicosia, Cyprus, contributed to this story.

______

Juergen Baetz can be reached at http://www.twitter.com/jbaetz

Don Melvin can be reached at https://twitter.com/Don_Melvin

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App gives more than ‘likes’

A new app launching in Boston April 3 aims to help businesses boost sales by offering customers rewards for promoting them on social media.

Socii (pronounced so-she) was founded last year by three Boston-area college grads who noticed how companies struggle to generate word-of-mouth marketing.

"Businesses spend millions of dollars every year to create it, but there's no system to do it," said Victor Dweck, a 2010 Northeastern University alum. "They use social networks like Facebook and Instagram, but their messages typically get lost in the noise. People go on to connect with their friends, not businesses."

Socii allows people to partner with up to three businesses and earn points for completing up to one activity per day, such as "liking" them on Facebook or posting photographs about them on Instagram. The points lead to rewards, including discounts and free goods.

Socii limits the number of businesses and activities people can choose to encourage them to partner only with their favorite businesses and to complete activities on a regular basis to accrue points, Dweck said.

"These aren't people who just want deals like on Groupon," he said. "These are the companies' most loyal customers."

So far, more than a half-dozen Boston area businesses — including J.P. Licks, Finale and Crema Cafe in Cambridge — have signed on to use the app, which doesn't require any new hardware, Dweck said.

"We feel this kind of word-of-mouth marketing creates loyalty among our customers," said J.P. Licks Marketing Manager Jason Provost. "When Victor reached out to us, I was like, why hasn't anyone thought of this before?"

Liz Cohen, head of marketing and design for Crema Cafe, said the company regularly tweets and posts on Facebook. But although it has more than 1,500 "likes," she's struggled with finding a way to get people to actually talk about the cafe on Facebook.

"When I saw what (Socii) was doing, it sounded great because it's a mutual thing," Cohen said. "We'll be asking customers to do things, but we'll also be showing them how much we appreciate them. Right now, we don't have that."

When the Specialty Coffee Association of America rolls into Boston on April 11 for its 25th annual expo, she said, the cafe will be able to use the app to get people attending the conference to tweet about Crema.

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Former workers find new life in industry

There is life beyond the ashes of Curt Schilling's 38 Studios, as seven former employees of the imploded Rhode Island gaming company came to PAX East yesterday to talk about the new studios they've started.

Featured on a panel at the video gaming convention, the budding entrepreneurs — most of whom have set up shop in the Bay State — join what's become a huge increase in the number of gaming and digital company startups in Massachusetts, 
up 78 percent from three years 
ago.

With the increased presence of indie gaming companies at PAX 
one of the big stories of this weekend's event, there's consensus that some of the most creative ideas in gaming are coming not out of the risk-averse mega companies, but rather from small studios, many based here.

The seven former 38 Studios employees confirmed that perception.

"Curt used to tell us that he hoped 38 Studios was the last place 
we'd work unless we started our own studios," said Joe Mirabello, who started Sharon-based Terrible Posture Games right after losing 
his job.

"It didn't pan out with his company so I decided that if I was going to work for a place that could go out of business it might as well be my own," Mirabello said.

Everyone on the panel said the spectacular collapse of Schilling's company was devastating, but it lit a fire under them. And while all refused to dish dirt on their former boss, they said that the collegial environment, which came before the abrupt flameout, had bonded former 38 Studios workers into a "brotherhood."

"We continue to take solace in one another and some have become close friends and help one another," said Geraldo Perez, who started King Bee Digital Games.

"It's been hard, but the video game industry has always been volatile," Perez said.

Rich Gallup got a job as a producer for fast-growing Disruptor Beam, but on the side started Summer Camp Studios.

"After what happened, my company's name was a way of picturing all of us all sent to a safe haven where we could go and learn new things," Gallup said.

Gallup said that most of the roughly 400 former employees of 
38 Studios have found work, 
with about half of them staying in the area and half relocating across the country.

"The attention this got opened a few doors," he admitted.

"But these were talented people, and that's why they found other jobs," he said.

Not everyone is making money off their new ventures, although a number of their games, mostly mobile-based, are for sale. Some said they relied on savings, others had a spouse with a good job, but a few are still living hand-to-mouth, determined to follow their passion to make games.

"My idea and my need was to make a game I wanted to play, and when I started it didn't matter if I made any money," said Paul Siegel, founder of Dancing Sorcerer Games.

Gallup has a better idea.

"My dream scenario is that companies put money in a fund, and if they go out of business workers can tap into that to do the games they want to do."

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