/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/090612.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, June 12, 2009, Vol. 13, No. 161 Headlines 31302 MONTEREY: Case Summary & Largest Unsecured Creditor ABEL C. MONIZ: Voluntary Chapter 11 Case Summary ADVANTA BANK: Fitch Cuts Issuer Default Rating to 'CC' ADVANTA CAPITAL: Fitch Affirms 'C/RR5' Trust Preferred Rating ADVANTA CORP: Fitch Downgrades Issuer Default Rating to 'C' ADVANTA CORP: Moves Tender Offer Expiration Date to June 15 AMC ENTERTAINMENT: Obtains Consents of Senior Notes Due 2012 AMERICAN INT'L: Court Hearing on Starr Dispute Set for Monday AXCESS MEDICAL: Case Summary & 20 Largest Unsecured Creditors BANCO POPULAR: S&P Cuts Rating to 'BB+/B'; Outlook Negative BANK OF AMERICA: Files Don't Show Fed Want Silence on Merrill Deal BANK OF AMERICA: Taps Merrill's Fares Noujaim as Vice Chairman BEREAN CHRISTIAN: Case Summary & 25 Largest Unsecured Creditors BERNARD L. MADOFF: Investors Seek to Recoup $3.5BB for Losses BROWN SHOE: S&P Changes Issue-Level Rating to 'B' From 'B-' BRYANT KEITH PETERS: Voluntary Chapter 11 Case Summary BUTLER SERVICES: Donlin Recano Retained as Claims Agent CAPMARK FINANCIAL: Inks 2nd Supplemental Indenture with Deutsche CAR WASH HOLDING: Case Summary & 11 Largest Unsecured Creditors CB RICHARD: S&P Affirms Counterparty Credit Rating at 'BB/B' CB RICHARD: Moody's Affirms Senior Debt Rating at 'Ba2' CHARTER COMMUNICATIONS: Shareholder Wants Equity Committee CHRYSLER LLC: Settles Preliminary Injunction Against Logghe CHRYSLER LLC: Wants to Hire PricewaterhouseCoopers as Tax Advisors CHRYSLER LLC: Wants Siegfried Group to Provide Accounting Services CHRSYLER LLC: Dollar Thrifty Discloses Updated Exposure CITIGROUP INC: Finalizes Gov't Pact, Starts Public Share Exchange CITY CREEK PROPERTY: Voluntary Chapter 11 Case Summary CMS ENERGY: Fitch Assigns 'BB+' Rating on $300 Mil. Notes COEUR D'ALLENE: To Exchange $15.9MM Senior Notes for Common Stock COLONIAL BANCGROUP: Inks Order With Alabama State and FDIC COLORADO RESOURCE: Case Summary & 20 Largest Unsecured Creditors CONNACHER OIL: Higher Debt Burden Cues Moody's to Junk Rating CONNACHER OIL: S&P Affirms Corporate Credit Rating at 'B' COOPER TIRE: Moody's Affirms Junk Rating on Unsecured Notes COVENTRY HEALTH: Moody's Affirms Senior Unsecured Debt at 'Ba1' CRESCENT RESOURCES: Case Summary & 30 Largest Unsecured Creditors DALE C. DEL BELLO: Voluntary Chapter 11 Case Summary DENNIS ALEX LUCERO: Case Summary & 2 Largest Unsecured Creditors DESIGNERS CHOICE: Case Summary & 20 Largest Unsecured Creditors DOMTAR CORP: S&P Assigns 'BB-' Rating on US$400 Mil. Notes DOUGLAS P. KUDELKA: Case Summary & 20 Largest Unsecured Creditors EDWARD M. DELEO: Case Summary & 20 Largest Unsecured Creditors EMPIRE EQUITIES: Chapter 11 Filing Extended Debtor's Option EQUINIX INC: S&P Assigns 'B-' Rating on $325 Mil. 2016 Notes F. A. M. M. LLC: Case Summary & 7 Largest Unsecured Creditors FAR EAST: Voluntary Chapter 11 Case Summary FILENE'S BASEMENT: Crown Questions Results of Auction Sale FOAMEX INT'L: Wayzata Capital Appeals Sale to MaitlinPatterson FONTAINEBLEAU LAS: Chapter 11 Filing Cues S&P's Rating Cut to 'D' FONTAINEBLEAU LAS: Moody's Downgrades Default Rating to 'D' FONTAINEBLEAU LAS VEGAS: Seeks Expedited Resolution of Lawsuit FREEDOM COMMUNICATIONS: S&P Withdraws 'CCC-' Corp. Credit Rating FREESCALE SEMICONDUCTOR: Likely to Pay Interest by December 2011 GENERAL GROWTH: Names William Ackman as Director GENERAL GROWTH: 22 Units Now Face Ch. 11 Case Dismissal Requests GENERAL GROWTH: Goldman Sachs & Brookfield Want $5.7MM Award GENERAL GROWTH: Wants Schedules Filing Deadline Moved to July 31 GENERAL GROWTH: A&K Endowment Appeals Final DIP Financing Order GENERAL MOTORS: Bondholders to Challenge Sale to New GM GENERAL MOTORS: NYSE Files Notice of Removal With SEC GENERAL MOTORS ACCEPTANCE: Moody's Raises Sr. Unsec. Rating to Ca GMAC BANK: Moody's Raises Backed Sr. Unsecured Rating to Ca GMAC INTERNATIONAL: Moody's Raises Backed Sr. Unsec. Rating to Ca GMAC LLC: Moody's Upgrades Senior Unsecured Rating to 'Ca' GOVERNMENT TELECOM.: Case Summary & 20 Largest Unsecured Creditors HAIGHTS CROSS: S&P Downgrades Corporate Credit Rating to 'CC' HAROLD L. ROSBOTTOM: Case Summary & 20 Largest Unsecured Creditors HART-SAHARA LLC: Case Summary & 17 Largest Unsecured Creditors HEALTHSOUTH CORPORATION: Moody's Upgrades Corporate Rating to 'B2' HENDRICKS FURNITURE: Case Summary & 20 Largest Unsecured Creditors HENDRICKS FURNITURE: Files for Chapter 11 Bankruptcy Protection HEXION SPECIALTY: Issues Results of Tender Offer for Debentures IGLESIA DE RESTAURACION: Case Summary & 3 Largest Unsec. Creditors IMAGE PACKAGING: Case Summary & 20 Largest Unsecured Creditors INTERNATIONAL PRINTING: Case Summary & 20 Largest Unsec. Creditors JAMES C. DOCHEFF: Case Summary & 20 Largest Unsecured Creditors JD NEWTON: Case Summary & 20 Largest Unsecured Creditors JOHN MANEELY: Moody's Downgrades Corporate Family Rating to 'B2' JT TRUCKING: Case Summary & 12 Largest Unsecured Creditors KAREN HUNTER: Case Summary & 20 Largest Unsecured Creditors KINETEK HOLDINGS: Debt Repurchase Prompts S&P's Rating Cut to 'D' KOBRA PROPERTIES: Chapter 11 Trustee Hires Committee's Counsel LANDSOURCE COMMUNITIES: Court Sets July 13 Confirmation Hearing LBI MEDIA: S&P Downgrades Corporate Credit Rating to 'B-' LEHMAN BROTHERS: Creditors Panel Also Wants Barclays Docs LEHMAN BROTHERS: Seeks to Restructure Loans With Broadway Partners LEHMAN BROTHERS: Seeks Court Okay to Pay Unit's Loan to Fortress LEHMAN BROTHERS: Wants to Buy Furniture & Equipment From Barclays LN ACQUISITION: Moody's Keeps Junk Rating on Senior Secured Loan LINCOLN HOLDINGS: S&P Downgrades Corporate Credit Rating to 'B' LYONDELL CHEMICAL: Settlement Agreements with 2 Insurers Approved MANSOUR TAEED: Case Summary & 20 Largest Unsecured Creditors MARYANN MCLEOD: Voluntary Chapter 11 Case Summary METALDYNE CORP: Can Hire BMC Group as Claims and Noticing Agent MOHAWK TRAVELER: Case Summary & 6 Largest Unsecured Creditors NA-MOR INC.: Case Summary & 11 Largest Unsecured Creditors NANOGEN INC: Wants Morgan Lewis as Special Bankruptcy Counsel NANOGEN INC: Wants More Time to File SALs & SOFAs Thru July 13 NAVISTAR INT'L: Reports $12 Million Profit in Second Quarter NEW YORK TIMES: Goldman Hints Start of Offer Acceptance OUTDOOR RV: Hires Levy Law Firm as Bankruptcy Counsel OUTDOOR RV: Has until June 15 to File Schedules and Statements OUTDOOR RV: Taps Harry Swagart to Handle SC Motor Vehicle Matters P&R REALTY: Voluntary Chapter 11 Case Summary PACIFIC ETHANOL: Wants to Tap Cooley Godward as Bankruptcy Counsel PAMELA ELLEN: Case Summary & 3 Largest Unsecured Creditors PARKSIDE VILLAGE: Case Summary & Largest Unsecured Creditor PHOENIX ASSOCIATES: Case Summary & 20 Largest Unsecured Creditors PHOENIX COYOTES: Jim Balsillie Balks at $100MM Relocation Fee PHOENIX COYOTES: Court Wants to See Other Bids for Firm POLK SOD SERVICES: Case Summary & 20 Largest Unsecured Creditors POPULAR INC: S&P Downgrades Counterparty Credit Rating to 'BB-' PRESIDENTIAL CLUB: Case Summary & 20 Largest Unsecured Creditors PREVALENCE HEALTH: Case Summary & 20 Largest Unsecured Creditors RICHARD MICHAEL: Case Summary & 21 Largest Unsecured Creditors ROGER J. ABDIN: Voluntary Chapter 11 Case Summary RUSSELL BROTHERS: Case Summary & 20 Largest Unsecured Creditors SEMGROUP LP: Court Permits Creditors Panel to Examine PwC, Et Al. SEMGROUP LP: Producers Committee Seeks Rule 2004 Discovery SEMGROUP LP: Court Okays SemStream's Settlement With Koch Supply SEMGROUP LP: Can Tap Russell Reynolds as Executive Search Advisors SHOPPES AT SILVER: Case Summary & 3 Largest Unsecured Creditors SILVER SPOONS: Voluntary Chapter 11 Case Summary SMURFIT-STONE: Has Until Sept. 23 to File Plan of Reorganization SMURFIT-STONE: Seeks Court Approval to Sell Fullerton Property SMURFIT-STONE: Court Okays Employment of Grubb & Ellis as Broker SPC SENIOR: Case Summary & 20 Largest Unsecured Creditors SPORTSMAN'S WAREHOUSE: Proposes Incentive Pay for Key Employees SUNGARD DATA: Amendment on Loan Won't Affect Fitch's 'B' Rating SUNGARD DATA: S&P Affirms Corporate Credit Rating at 'B+' TERRY PAINTER: Case Summary & 15 Largest Unsecured Creditors THOMPSON RESIDUARY: Case Summary & 15 Largest Unsecured Creditors TOUSA INC: Creditors Committee Sues Former Directors TRIBUNE COMPANY: Beatty Asks Court to Lift Stay on D. Tracy Suit TWELVE OAKS: Case Summary & 11 Largest Unsecured Creditors UAL CORP: Weak Credit Profile Cues Fitch to Junk Issuer Rating UNITED AIRLINES: Fitch Junks Issuer Default Rating WESTERN SUPPLY CORP.: Case Summary & 20 Largest Unsec. Creditors WILLIAM LYON: Moody's Affirms Corporate Family Rating at 'Caa2' * Berger Singerman Gets Top Ranking in Chambers USA 2009 Guide * Focus Management Group Is Finalist in Turnaround Atlas Awards * Getzler Henrich Forms Affiliation With Prolman Associates * Matthew Salerno Joins McDonald Hopkins' Cleveland Office * BOOK REVIEW: Crafting Solutions for Troubled Businesses: ********* 31302 MONTEREY: Case Summary & Largest Unsecured Creditor --------------------------------------------------------- Debtor: 31302 Monterey Capital Management, Inc. 550 West C Street, Suite 1850 San Diego, CA 92101 Bankruptcy Case No.: 09-08161 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Southern District of California (San Diego) Judge: Louise DeCarl Adler Debtor's Counsel: Thomas C. Nelson, Esq. 550 West C Street, Ste 1850 San Diego, CA 92101 Tel: (619) 236-1245 Email: Tom@tcnlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor identified Alan Mandelberg with a disputed trade claim for an unknown amount as its largest unsecured creditor. The petition was signed by Keith Middlebrook, president of the Company. ABEL C. MONIZ: Voluntary Chapter 11 Case Summary ------------------------------------------------ Joint Debtors: Abel C. Moniz Fatima Moniz dba Fatima's Fashions 497 Briggs Road Westport, MA 02790 Bankruptcy Case No.: 09-15388 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Frank J. Bailey Debtors' Counsel: Roger Stanford, Esq. Stanford & Schall 100 Eighth Street New Bedford, MA 02740 Tel: (508) 994-3393 Fax: (508) 994-3368 Email: ROGERSTANF@AOL.COM Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtors did not file a list of their 20 largest unsecured creditors when they filed their petition. The petition was signed by the Joint Debtors. ADVANTA BANK: Fitch Cuts Issuer Default Rating to 'CC' ------------------------------------------------------ Fitch Ratings has downgraded the long-term Issuer Default Rating and the outstanding debt ratings of Advanta Corp. and Advanta Bank Corp.: Advanta Corp. -- Long-term IDR to 'C' from 'CC'; -- Senior debt to 'C/RR5' from 'CC/RR4'. Advanta Bank Corp. -- Long-term IDR to 'CC' from 'CCC'. Fitch has placed Advanta Corp.'s IDR on Rating Watch Negative and expects to downgrade the IDR to 'Restricted Default' upon consummation of the tender offer for all $100 million of the 8.99% trust preferred securities on June 15, 2009. All remaining ratings no longer carry a Rating Outlook or Watch. The downgrades reflect an expectation for further deterioration of profitability and asset quality due to the closing of all credit card accounts as of May 30, 2009. Advanta is now in wind-down mode. The recovery rating on the senior debt at the parent, which amounted to $183 million as of March 31, 2009, was revised to 'RR5' from 'RR4', which reflects below average recovery prospects. The revision was driven by an expected decline in liquid assets at Advanta Corp. resulting from the tender for the trust preferred securities and the cash burn associated with running the business down. Fitch does not expect the bank to upstream any further dividends to the parent. Fitch has affirmed these ratings: Advanta Bank Corp. -- Short-term IDR at 'C'. -- Long-term deposits at 'B-/RR2'. Advanta Capital Trust -- Trust Preferred at 'C/RR5'. Fitch affirmed Advanta Bank Corp.'s long-term deposit rating and assigned a Recovery Rating of 'RR2', which reflects superior recovery prospects. As of March 31, 2009, the bank had cash, securities, and fed funds sold of approximately $2.2 billion versus $2.5 billion of deposits. Fitch affirmed the trust preferred rating, but revised the Recovery Rating to an 'RR5' from an 'RR6' to incorporate Advanta's tender offer for the securities at 20% of face value. A recovery rating of 'RR5' reflects below average recovery prospects and is consistent with securities historically recovering 11% to 30% of principal and accrued interest. Fitch has withdrawn these ratings: Advanta Corp. -- Short-term IDR 'C'. The rating withdrawal reflects Fitch's belief that the parent company will not issue any further short-term debt. ADVANTA CAPITAL: Fitch Affirms 'C/RR5' Trust Preferred Rating ------------------------------------------------------------- Fitch Ratings has downgraded the long-term Issuer Default Rating and the outstanding debt ratings of Advanta Corp. and Advanta Bank Corp.: Advanta Corp. -- Long-term IDR to 'C' from 'CC'; -- Senior debt to 'C/RR5' from 'CC/RR4'. Advanta Bank Corp. -- Long-term IDR to 'CC' from 'CCC'. Fitch has placed Advanta Corp.'s IDR on Rating Watch Negative and expects to downgrade the IDR to 'Restricted Default' upon consummation of the tender offer for all $100 million of the 8.99% trust preferred securities on June 15, 2009. All remaining ratings no longer carry a Rating Outlook or Watch. The downgrades reflect an expectation for further deterioration of profitability and asset quality due to the closing of all credit card accounts as of May 30, 2009. Advanta is now in wind-down mode. The recovery rating on the senior debt at the parent, which amounted to $183 million as of March 31, 2009, was revised to 'RR5' from 'RR4', which reflects below average recovery prospects. The revision was driven by an expected decline in liquid assets at Advanta Corp. resulting from the tender for the trust preferred securities and the cash burn associated with running the business down. Fitch does not expect the bank to upstream any further dividends to the parent. Fitch has affirmed these ratings: Advanta Bank Corp. -- Short-term IDR at 'C'. -- Long-term deposits at 'B-/RR2'. Advanta Capital Trust -- Trust Preferred at 'C/RR5'. Fitch affirmed Advanta Bank Corp.'s long-term deposit rating and assigned a Recovery Rating of 'RR2', which reflects superior recovery prospects. As of March 31, 2009, the bank had cash, securities, and fed funds sold of approximately $2.2 billion versus $2.5 billion of deposits. Fitch affirmed the trust preferred rating, but revised the Recovery Rating to an 'RR5' from an 'RR6' to incorporate Advanta's tender offer for the securities at 20% of face value. A recovery rating of 'RR5' reflects below average recovery prospects and is consistent with securities historically recovering 11% to 30% of principal and accrued interest. Fitch has withdrawn these ratings: Advanta Corp. -- Short-term IDR 'C'. The rating withdrawal reflects Fitch's belief that the parent company will not issue any further short-term debt. ADVANTA CORP: Fitch Downgrades Issuer Default Rating to 'C' ----------------------------------------------------------- Fitch Ratings has downgraded the long-term Issuer Default Rating and the outstanding debt ratings of Advanta Corp. and Advanta Bank Corp.: Advanta Corp. -- Long-term IDR to 'C' from 'CC'; -- Senior debt to 'C/RR5' from 'CC/RR4'. Advanta Bank Corp. -- Long-term IDR to 'CC' from 'CCC'. Fitch has placed Advanta Corp.'s IDR on Rating Watch Negative and expects to downgrade the IDR to 'Restricted Default' upon consummation of the tender offer for all $100 million of the 8.99% trust preferred securities on June 15, 2009. All remaining ratings no longer carry a Rating Outlook or Watch. The downgrades reflect an expectation for further deterioration of profitability and asset quality due to the closing of all credit card accounts as of May 30, 2009. Advanta is now in wind-down mode. The recovery rating on the senior debt at the parent, which amounted to $183 million as of March 31, 2009, was revised to 'RR5' from 'RR4', which reflects below average recovery prospects. The revision was driven by an expected decline in liquid assets at Advanta Corp. resulting from the tender for the trust preferred securities and the cash burn associated with running the business down. Fitch does not expect the bank to upstream any further dividends to the parent. Fitch has affirmed these ratings: Advanta Bank Corp. -- Short-term IDR at 'C'. -- Long-term deposits at 'B-/RR2'. Advanta Capital Trust -- Trust Preferred at 'C/RR5'. Fitch affirmed Advanta Bank Corp.'s long-term deposit rating and assigned a Recovery Rating of 'RR2', which reflects superior recovery prospects. As of March 31, 2009, the bank had cash, securities, and fed funds sold of approximately $2.2 billion versus $2.5 billion of deposits. Fitch affirmed the trust preferred rating, but revised the Recovery Rating to an 'RR5' from an 'RR6' to incorporate Advanta's tender offer for the securities at 20% of face value. A recovery rating of 'RR5' reflects below average recovery prospects and is consistent with securities historically recovering 11% to 30% of principal and accrued interest. Fitch has withdrawn these ratings: Advanta Corp. -- Short-term IDR 'C'. The rating withdrawal reflects Fitch's belief that the parent company will not issue any further short-term debt. ADVANTA CORP: Moves Tender Offer Expiration Date to June 15 ----------------------------------------------------------- Advanta Corp. extended the expiration date of the cash tender offer for any and all of the $100 million of outstanding Advanta Capital Trust I 8.99% Capital Securities to June 15, 2009. The "Settlement Date" will be promptly following the New Expiration Date and is expected to be June 18, 2009. Tendered Capital Securities, including any Capital Securities that were tendered on or prior to the original Expiration Date, may be withdrawn in accordance with the terms of the Tender Offer at any time prior to 5:00 p.m., New York City time, on the New Expiration Date. Holders who have tendered their Capital Securities and who do not validly withdraw their Notes will continue to be eligible to receive the tender offer consideration without the need to re- tender their Notes or take any other action in response to this extension. If tenders are validly withdrawn before the New Expiration Date, Holders will no longer be eligible to receive the tender offer consideration. The terms and conditions of the Tender Offer, as extended, are set forth in the Offer Documents. All other terms and conditions of the Tender Offer, as extended, remain in full force and effect. The company said it had received tenders with respect to about $7 million of the aggregate principal amount of the outstanding Capital Securities pursuant to the Tender Offer. About Advanta Corp. Advanta Corp. -- http://www.advanta.com/-- is one of the nation's largest credit card providers, through Advanta Bank Corp., in the small business market. Advanta's focus on this market as well as its size, experience, and service tailored to the needs of small businesses differentiates the company from other credit card companies. Founded in 1951, Advanta has long been an innovator in developing and introducing many of the marketing techniques that are common in the financial services industry. At March 31, 2009, the Company had $3.39 billion in total assets, $2.97 billion in total liabilities and $427.7 million in stockholders' equity. The Company had $75.9 million in net loss for the three months ended March 31, 2009, compared to net income of $18.3 million for the same period in 2008. * * * As reported by the Troubled Company Reporter on May 14, 2009, Standard & Poor's Ratings Services lowered its ratings on Advanta Corp., including lowering the long-term counterparty credit rating to 'CC' from 'CCC'. At the same time, S&P lowered the counterparty credit rating on Advanta's primary operating subsidiary, Advanta Bank Corp., to 'CC' from 'B-'. The rating on the preferred stock of Advanta Capital Trust I remains at 'C'. The outlook is negative. The rating action, S&P said, follows Advanta's announcement that its securitization trust, its primary funding vehicle, will go into early amortization on June 10, 2009. Also, the Company does not plan to fund any activity for the accounts in the trust on its balance sheet; therefore, it will shut these accounts down. Earlier in May 2009, Moody's Investors Service downgraded the long-term ratings of Advanta Corp. (senior unsecured rating to Caa3 from Caa1). The trust preferred securities rating of Advanta Capital Trust I was lowered to C from Caa3. The outlook for the senior unsecured rating is negative; the outlook for the trust preferred rating is stable. The rating action reflects Moody's view that Advanta's intrinsic credit quality has eroded as the result of continued deterioration in asset quality, heightened pressures on funding and liquidity, and the adverse effects of these factors on the firm's core profitability. Fitch Ratings also downgraded the long-term Issuer Default Rating and outstanding debt ratings of Advanta Corp. and Advanta Bank Corp. earlier in May 2009. Advanta Corp.'s Long-term IDR was lowered to 'CC' from 'BB-'; short-term IDR was lowered to 'C' from 'B'; and senior unsecured was lowered to 'CC/RR4' from 'BB-'. Advanta Bank Corp.'s long-term IDR was lowered to 'CCC' from 'BB-'; Short-term IDR was lowered to 'C' from 'B'; and Long- term Deposits were lowered to 'B-' from 'BB'. Advanta Capital Trust I's Trust preferred stock was lowered to 'C/RR6' from 'B'. Roughly $2.7 billion of debt, deposits and preferred securities are affected by these actions. The downgrade, Fitch said, reflects significant deterioration in profitability and portfolio credit quality and the heightened risk of breaching early amortization triggers on off-balance sheet ABS transactions, which could lead to a possible shut-down of the business. AMC ENTERTAINMENT: Obtains Consents of Senior Notes Due 2012 ------------------------------------------------------------ AMC Entertainment Inc. received tenders and consents from the holders of $238,065,000 of its outstanding 8-5/8% Senior Notes due 2012 by the expiration of the consent payment deadline, June 8, 2009, at 5 p.m. EST. The consents received exceeded the number needed to approve the proposed amendments to the indenture under which the 2012 Notes were issued. The terms of the tender offer and consent solicitation for the 2012 Notes are detailed in AMC's Offer to Purchase and Consent Solicitation Statement dated May 26, 2009. Under the terms of the tender offer, holders who tendered on or prior to the Consent Date will receive $1,030 per $1,000 in principal amount of the 2012 Notes validly tendered. Holders who tender after the Consent Date will receive $1,000 per $1,000 in principal amount of the 2012 Notes validly tendered. The tender offer will expire at midnight, New York City time, on June 22, 2009. The company intends to redeem any 2012 Notes that remain outstanding after the consummation of the tender offer at a price of $1,021 per $1,000 principal amount of Notes as promptly as practicable after August 15, 2009, in accordance with the terms of the Indenture. Based on the consents received, the company and the trustee under the Indenture are expected to enter into a supplemental indenture that will, once operative, eliminate substantially all of the restrictive covenants and certain events of default and reduce the required notice period contained in the optional redemption provisions of the Indenture. The supplemental indenture will become operative tomorrow upon payment for 2012 Notes tendered on or prior to the Consent Date and accepted for purchase by the Company pursuant to the tender offer. Requests for documents relating to the tender offer may be directed to Global Bondholder Services Corp., the Information Agent, at (866) 488-1500 or (212) 430-3774. Credit Suisse Securities (USA) LLC is the Dealer Manager for the tender offer and Solicitation Agent for the consent solicitation. Questions regarding the tender offer and consent solicitation may be directed to Credit Suisse Securities (USA) LLC at (800) 820-1653 and (212) 538-1862. About AMC Entertainment Headquartered in Kansas City, Missouri, AMC Entertainment Inc. -- http://www.amctheatres.com/-- is a theatrical exhibition company. As of July 3, 2008, the Company owned, operated or had interests in 353 theatres and 5,117 screens, with 89% or 4,569 of its screens in the U.S. and Canada and 11%, or 548 of its screens in Mexico, China (Hong Kong), France, and the United Kingdom. The Company's principal direct and indirect owned subsidiaries are American Multi-Cinema Inc., Grupo Cinemex, S.A. de C.V., and AMC Entertainment International Inc. * * * As reported in the Troubled Company Reporter June 1, 2009, Standard & Poor's Ratings Services affirmed its ratings on AMC Entertainment Inc.'s proposed senior unsecured notes due 2019, following the company's announcement that it now intends to issue $600 million of notes (upsized from $300 million). The issue- level rating remains at 'B-' (one notch lower than the 'B' corporate credit rating on AMC) and the recovery rating remains at '5', indicating S&P's expectation of modest (10% to 30%) recovery for noteholders in the event of a payment default. According to the Troubled Company Reporter on May 29, 2009, Moody's Investors Service rated AMC Entertainment, Inc.'s new $600 million senior unsecured notes B1. Proceeds will be used to retire AMC's $250 million 8.625% notes due August 2012 and to bolster liquidity by reducing outstanding amounts under its $200 million senior secured revolving term loan due January, 2012 and adding to the company's cash balance. On May 28, 2009, Standard & Poor's Ratings Services said it assigned an issue-level rating of 'B-' (one notch lower than the 'B' corporate credit rating on the company) to AMC Entertainment Inc.'s new $300 million senior unsecured notes due 2019, along with a recovery rating of '5', indicating S&P's expectation of modest (10%-30%) recovery for noteholders in the event of payment default. AMERICAN INT'L: Court Hearing on Starr Dispute Set for Monday ------------------------------------------------------------- Liam Pleven at The Wall Street Journal reports that the long- running dispute between American International Group Inc. and Starr International Co. over control of more than $4.3 billion in shares will be heard in the federal district court in lower Manhattan on Monday. WSJ relates that the dispute is on the tens of millions of shares Starr International holds in AIG as well as tens of millions of shares the firm sold in recent years. Starr International is an investment firm led by AIG's longtime former CEO Maurice R. Greenberg. AIG said that it should control the shares, WSJ states. According to WSJ, AIG alleged that Starr International was holding the shares in trust. The report says that Starr International would contend that the absence of a trust agreement with AIG at the time the shares were transferred shows there was no trust and no intent to create one. According to WSJ, Starr International got the shares in AIG through a 1970 reorganization of the Company and affiliated firms. WSJ notes that AIG's share price shot up as the Company grew. WSJ says that the stake was valued at $17 billion during the departure of Mr. Greenberg, who had led AIG for decades when the shares were used to fund a long-term compensation plan for the Company's employees. The program ended after Mr. Greenberg left AIG in 2005 amid a probe of the Company's accounting, the report says. Starr International has been using the funds for other purposes, including investments, according to the report. WSJ reports that Starr International sold many AIG shares in 2006 and 2007, when the Company's share price was higher, which generated more than $4 billion. AIG would demand for that money, plus other disputed shares that Starr International holds, the WSJ says. AIG, according to WSJ, said on Thursday that it would use any cash it wins from the dispute to help pay back the debt it owes the federal government. WSJ states that any winnings that AIG gets in stock -- currently worth a far smaller amount than the cash Starr International has generated from selling other stock -- will be used toward employee long-term compensation. WSJ says that Mr. Greenberg would testify in the trial. WSJ states that a loss in the case could take away a huge asset from Starr International. WSJ notes that if Starr International loses in the case, it could contend that its only obligation is to produce the full number of disputed shares, valued at $400 million to $500 million. The report states that Starr International has recently acquired AIG shares that could help meet any obligation. U.S. District Judge Jed Rakoff will decide how much leeway AIG has to ask Mr. Greenberg about matters beyond Starr International, WSJ relates. AIG has retained Theodore Wells to represent it in the case, while Starr International has retained David Boies, WSJ states. AIG Closes Secondary Offering of Shares in Transatlantic AIG has closed the previously announced public offering of 29.9 million shares of Transatlantic Holdings, Inc. common stock owned by the Company and its indirect subsidiary, American Home Assurance Company for aggregate gross proceeds of $1.136 billion. TRH will not receive any of the proceeds from the secondary offering. The transaction enabled AHAC, a subsidiary of AIU Holdings, Inc., to monetize part of its investment in TRH to improve the quality of its capital and help position AIU Holdings for continued success. The secondary offering was made through a syndicate of underwriters, led by J.P. Morgan Securities Inc., Goldman, Sachs & Co., and Morgan Stanley & Co. as joint book-running managers with Lazard Capital Markets LLC as co-lead underwriter. Dowling & Partners and Fox-Pitt Kelton Cochran Caronia Waller acted as co- managers of the offering. At the close of the secondary offering, AHAC owns 9,192,662 common shares of Transatlantic Holdings, Inc., representing approximately 13.9% of Transatlantic Holdings Inc.'s common shares issued and outstanding. About AIG Based in New York, American International Group, Inc. (AIG), is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. During the third quarter of 2008, requirements to post collateral in connection with AIG Financial Products Corp.'s credit default swap portfolio and other AIGFP transactions and to fund returns of securities lending collateral placed stress on AIG's liquidity. AIG's stock price declined from $22.76 on September 8, 2008, to $4.76 on September 15, 2008. On that date, AIG's long-term debt ratings were downgraded by Standard & Poor's, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service and Fitch Ratings, which triggered additional requirements for liquidity. These factors and other events severely limited AIG's access to debt and equity markets. On September 22, 2008, AIG entered into an $85 billion revolving credit agreement with the Federal Reserve Bank of New York and pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000 shares of Series C Perpetual, Convertible, Participating Preferred Stock to a trust for the benefit of the United States Treasury. At September 30, 2008, amounts owed under the facility created pursuant to the Fed Credit Agreement totaled $63 billion, including accrued fees and interest. Since September 30, 2008, AIG has borrowed additional amounts under the Fed Facility and has announced plans to sell assets and businesses to repay amounts owed in connection with the Fed Credit Agreement. Certain of AIG's domestic life insurance subsidiaries subsequently entered into an agreement with the NY Fed pursuant to which the NY Fed has borrowed, in return for cash collateral, investment grade fixed maturity securities from the insurance subsidiaries. On November 10, 2008, the U.S. Treasury agreed to purchase, through its Troubled Asset Relief Program, $40 billion of newly issued AIG perpetual preferred shares and warrants to purchase a number of shares of common stock of AIG equal to 2% of the issued and outstanding shares as of the purchase date. All of the proceeds will be used to pay down a portion of the Federal Reserve Bank of New York credit facility. The perpetual preferred shares will carry a 10% coupon with cumulative dividends. AIG and the Fed also agreed to revise the existing FRBNY credit facility. The loan terms were extended from two to five years to give AIG more time to complete its planned asset sales in an orderly manner. The equity interest that taxpayers will hold in AIG, coupled with the warrants, will total 79.9%. At September 30, 2008, AIG had $1.022 trillion in total consolidated assets and $950.9 billion in total debts. Shareholders' equity was $71.18 billion, including the addition of $23 billion of consideration received for preferred stock not yet issued. The Troubled Company Reporter reported on March 4, 2009, that Moody's Investors Service confirmed the A3 senior unsecured debt and Prime-1 short-term debt ratings of American International Group, Inc. AIG's subordinated debt rating has been downgraded to Ba2 from Baa1. The rating outlook for AIG is negative. This rating action follows AIG's announcement of net losses of $62 billion for the fourth quarter and $99 billion for the full year of 2008, along with a revised restructuring plan supported by the U.S. Treasury and the Federal Reserve. This concludes a review for possible downgrade that was initiated on September 15, 2008. AXCESS MEDICAL: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: AXCESS MEDICAL Imaging Corporation 551 North Cattlemen Road, Suite 202 Sarasota, FL 34232 Bankruptcy Case No.: 09-12180 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Imaging Holding LLC 09-12181 U.S. Imaging Center Corp., LLC 09-12182 Axcess Diagnostics Bradenton, LLC 09-12183 Axcess Diagnostics Sarasota, LLC 09-12184 Clearwater Resources, Inc. 09-12186 Bradenton Resources, Inc. 09-12187 MRI - South Umberton, Inc. 09-12189 Morgan Medical Corporation 09-12190 Charlotte Resources, Inc. 09-12192 Jacksonville Resources, Inc. 09-12194 Axcess Management Group, LLC 09-12197 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Judge: Caryl E. Delano Debtor's Counsel: Charles A. Postler, Esq. Stichter, Riedel, Blain & Prosser 110 E Madison Street, Suite 200 Tampa, FL 33602-4700 Tel: (813) 229-0144 Email: cpostler.ecf@srbp.com Scott A. Stichter, Esq. Stichter, Riedel, Blain & Prosser 110 E. Madison Street, Suite 200 Tampa, FL 33602-4700 Tel: (813) 229-0144 Fax: (813) 229-1811 Email: sstichter.ecf@srbp.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/flmb09-12180.pdf The petition was signed by Stephen M. Miley, M.D., manager of the Company. BANCO POPULAR: S&P Cuts Rating to 'BB+/B'; Outlook Negative ----------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its ratings on Popular Inc., including lowering the long-term counterparty credit rating to 'BB-' from 'BB+' and the rating on the company's preferred shares to 'C' from 'B-', and affirmed the short-term counterparty credit rating at 'B'. S&P also lowered its ratings on the company's primary subsidiary, Banco Popular de Puerto Rico, to 'BB+/B' from 'BBB-/A-3'. The outlooks are negative. The rating downgrade followed management's announcement that it would suspend dividends on shares of the company's common stock and on its series A and series B preferred stock. Management also announced plans to offer common stock in exchange for its series A and series B preferred and its trust-preferred securities. "We believe that these actions reflect increasing pressures on the company's capital position, operating performance, and liquidity," said Standard & Poor's credit analyst Robert Hansen. S&P forecasts high participation in the planned exchange offer based on the proposed premium and view favorably the anticipated increase of nearly $1.2 billion in tangible common equity. However, S&P expects the bank's continued credit quality deterioration and the net losses it will likely sustain over the next several quarters to more than fully offset the positive implications from the planned exchange offer. The downgrade also reflects S&P's expectations for continued bottom-line losses stemming from increasing credit losses and the associated pressures on capital ratios. Specifically, S&P expects that nonperforming assets will continue to rise over the next several quarters, notably in the construction, mortgage, and commercial loan portfolios, as S&P sees continued weakness in home prices, reduced sale activity and continuing difficult economic conditions in Puerto Rico. The negative outlook reflects S&P's belief that the rating will remain under pressure for some time. If credit quality deteriorates beyond S&P's current expectations, S&P could lower the rating further. However, if the company returns to profitability because its credit quality improves, then S&P could raise the ratings, which S&P views as less likely given S&P's general economic outlook. BANK OF AMERICA: Files Don't Show Fed Want Silence on Merrill Deal ------------------------------------------------------------------ Documents subpoenaed from the Federal Reserves as part of a congressional probe on Merrill Lynch acquisition don't support Bank of America CEO Kenneth Lewis' assertion that the Fed instructed him to keep information about the deal secret, Michael R. Crittenden at The Wall Street Journal reports. As reported by the Troubled Company Reporter on June 10, 2009, a House of Representatives committee said that it would subpoena the Fed to surrender documents regarding its role in BofA's takeover of Merrill. The Fed would only let committee staff to review documents at the Washington offices, which they did for several days. After the staff review, the committee decided that they would need copies of documents that include a handwritten notes from a December 19, 2008 meeting between Fed chairperson Ben Bernanke and Mr. Lewis. The Fed, faced with the subpoena, decided to hand over the documents. Mr. Lewis said that he told the U.S. Treasury and Fed officials that he was considering declaring a "material adverse change" which would have allowed the Company to walk away from the acquisition, but "Treasury and Federal Reserve representatives asked us to delay any such action, and expressed significant concerns about the systemic consequences," and that the government pressured him to pursue the deal and to withhold information about losses at Merrill from investors. According to WSJ, documents obtained by the investigators said that Fed officials criticized BofA and Mr. Lewis in e-mails after the Company tried to pull out of the Merrill deal. WSJ relates that Fed attorneys said that BofA's arguments were "not credible." Citing a top examiner, WSJ says that Mr. Lewis' claim that BofA was surprised by Merrill's mounting losses "seems somewhat suspect." The documents showed that Mr. Bernanke was willing to threaten Mr. Lewis' removal, WSJ relates. Fed President Jeffrey Lacker, according to the report, said in an e-mail sent in December 2008 that Mr. Bernanke "intends to make it even more clear" that if BofA withdraws from the Merrill deal and later needs government assistance, "management is gone." WSJ states that a testimony provided by Mr. Lewis to New York Attorney General Andrew Cuomo revealed that government officials would consider ousting him or other BofA executives if the Company didn't push through with its planned purchase of Merrill. About Bank of America Based in Charlotte, North Carolina, Bank of America -- http://www.bankofamerica.com/-- is one of the world's largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The Company serves more than 59 million consumer and small business relationships with more than 6,100 retail banking offices, nearly 18,700 ATMs and online banking with nearly 29 million active users. Following the acquisition of Merrill Lynch on January 1, 2009, Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes serving corporations, governments, institutions and individuals around the world. Bank of America offers support to more than 4 million small business owners. The Company serves clients in more than 150 countries. Bank of America Corporation stock is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange. The bank needed the government's financial help in completing its acquisition of Merrill Lynch. Merrill Lynch & Co. Inc. -- http://www.ml.com/-- is a wealth management, capital markets and advisory companies with offices in 40 countries and territories. As an investment bank, it is a leading global trader and underwriter of securities and derivatives across a broad range of asset classes and serves as a strategic advisor to corporations, governments, institutions and individuals worldwide. Merrill Lynch owns approximately half of BlackRock, one of the world's largest publicly traded investment management companies with more than $1 trillion in assets under management. Merrill Lynch's operations are organized into two business segments: Global Markets and Investment Banking (GMI) and Global Wealth Management (GWM). As reported by the Troubled Company Reporter on March 27, 2009, Moody's Investors Service lowered the senior debt rating of Bank of America Corporation to A2 from A1, the senior subordinated debt rating to A3 from A2, and the junior subordinated debt rating to Baa3 from A2. The preferred stock rating was downgraded to B3 from Baa1. The holding company's short-term rating was affirmed at Prime-1. BANK OF AMERICA: Taps Merrill's Fares Noujaim as Vice Chairman -------------------------------------------------------------- Mirna Sleiman and Susanne Craig at The Wall Street Journal report that Bank of America Corp. has appointed Merrill Lynch banker Fares Noujaim as corporate and investment banking vice chairman. According to WSJ, Mr. Noujaim will report to Brian Moynihan, the president of global banking and wealth management at BofA, and will be based in New York. Mr. Noujaim will also remain as global head of sovereign-wealth funds, WSJ says. WSJ relates that Mr. Noujaim left Bear Stearns Cos. to join Merrill Lynch as president in its Middle East and North Africa operations in June 2008. Based in Charlotte, North Carolina, Bank of America -- http://www.bankofamerica.com/-- is one of the world's largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The Company serves more than 59 million consumer and small business relationships with more than 6,100 retail banking offices, nearly 18,700 ATMs and online banking with nearly 29 million active users. Following the acquisition of Merrill Lynch on January 1, 2009, Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes serving corporations, governments, institutions and individuals around the world. Bank of America offers support to more than 4 million small business owners. The Company serves clients in more than 150 countries. Bank of America Corporation stock is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange. The bank needed the government's financial help in completing its acquisition of Merrill Lynch. Merrill Lynch & Co. Inc. -- http://www.ml.com/-- is a wealth management, capital markets and advisory companies with offices in 40 countries and territories. As an investment bank, it is a leading global trader and underwriter of securities and derivatives across a broad range of asset classes and serves as a strategic advisor to corporations, governments, institutions and individuals worldwide. Merrill Lynch owns approximately half of BlackRock, one of the world's largest publicly traded investment management companies with more than $1 trillion in assets under management. Merrill Lynch's operations are organized into two business segments: Global Markets and Investment Banking (GMI) and Global Wealth Management (GWM). As reported by the Troubled Company Reporter on March 27, 2009, Moody's Investors Service lowered the senior debt rating of Bank of America Corporation to A2 from A1, the senior subordinated debt rating to A3 from A2, and the junior subordinated debt rating to Baa3 from A2. The preferred stock rating was downgraded to B3 from Baa1. The holding company's short-term rating was affirmed at Prime-1. BEREAN CHRISTIAN: Case Summary & 25 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Berean Christian Stores, LLC 9415 Meridian Way West Chester, OH 45069 Bankruptcy Case No.: 09-13640 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Southern District of Ohio (Cincinnati) Judge: Jeffery P. Hopkins Debtor's Counsel: Kasey T. Ingram, Esq. Dinsmore & Shohl LLP 191 W. Nationwide Blvd., Suite 300 Columbus, OH 43215 Tel: (614) 628-6927 Fax: (614) 628-6890 Email: kingram@dinslaw.com Patrick Burns, Esq. Dinsmore & Shohl 255 East Fifth Street Cincinnati, OH 45202 Tel: (513) 977-8458 Email: patrick.burns@dinslaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 25 largest unsecured creditors is available for free at: http://bankrupt.com/misc/ohsb09-13640.pdf The petition was signed by David William Simmons, III, president and chief executive officer of the Company. BERNARD L. MADOFF: Investors Seek to Recoup $3.5BB for Losses ------------------------------------------------------------- Chad Bray at Dow Jones Newswires reports that investors in Kingate Global Fund Ltd. and Kingate Euro Fund Ltd. have filed a lawsuit against Bernard L. Madoff, seeking to recover $3.5 billion in alleged losses. Dow Jones states that investors Criterium Capital Funds BV, BBF Trust, Wall Street Securities SA, Banca Arner SA, and Alvaro Castillo also sued fund manager Kingate Management Ltd., Grosso's FIM Advisers LLP, which acted as a consultant to the funds, and certain other entities. According to Dow Jones, Kingate Global and Kingate Euro are feeder funds to Bernard L. Madoff Investment Securities LLC. The investors said in court documents, "Reportedly, over $3 billion was invested in Kingate Global and Kingate Euro, and virtually all of those moneys were funneled to Madoff." The investors claimed that Kingate, FIM Advisers, and others ignored "red flags" that Mr. Madoff was operating a Ponzi scheme, including his use of an unknown accounting firm to serve as his firm's auditor, Dow Jones says. Dow Jones relates that Irving Picard, the court-appointed trustee for the Madoff firm, sued the two Kingate funds in April 2009, seeking the return of $255 million withdrawn from the Madoff firm between October and November 2008. Investors Sue Trustee Noeleen G. Walder at the New York Law Journal reports that three Pennsylvania residents have sued Mr. Picard, claiming that he favored the brokerage industry and enriched Wall Street at the expense of innocent investors. According to Dow Jones, the investors said that Mr. Picard has created his own definition of "net equity" and "intends to avoid paying [Securities Investor Protection Corporation] insurance to the thousands of elderly Madoff investors" who depended on those investments for their "daily living expenses," by "disregarding all appreciation" in investors' accounts, which were collectively valued at $9.6 million on the last account statement received before Mr. Madoff's arrest. Investors, Dow Jones says, accused Mr. Picard of breaching his fiduciary duty to investors by deducting withdrawals they made within 90 days of the December 15, 2008 liquidation, which they claimed prevented them from collecting the $500,000 in compensation they are entitled to under the Securities Investor Protection Corporation. Dow Jones states that SIPC and Mr. Picard have maintained that this doesn't qualify as insurance. Dow Jones relates that clients of failed brokerage firms who qualify can receive up to $500,000 in compensation from SIPC. Helen Davis Chaitman of Phillips Nizer, who represents the investors, accused Mr. Picard of delaying the payout of claims, Dow Jones reports. Mr. Picard has to rely on teams of accountants to evaluate the records of investors' accounts, than looking to their most recent statements to determine net equity, Dow Jones states, citing Ms. Chaitman. About Bernard L. Madoff Bernard L. Madoff Investment Securities LLC was a market maker in U.S. stocks, including all of the S&P 500 and more than 350 Nasdaq stocks. The firm moved large blocks of stock for institutional clients by splitting up orders or arranging off-exchange transactions between parties. It also performed clearing and settlement services. Clients included brokerages, banks, and other financial institutions. In addition, Madoff Securities managed assets for high-net-worth individuals, hedge funds, and other institutional investors. The firm is being liquidated in the aftermath of a fraud scandal involving founder Bernard L. Madoff. As reported by the Troubled Company Reporter on December 15, 2008, the Securities and Exchange Commission charged Mr. Madoff and his investment firm with securities fraud for a multi-billion dollar Ponzi scheme that he perpetrated on advisory clients of his firm. The estimated losses from Madoff's fraud were allegedly at least $50 billion. Also on December 15, 2008, the Honorable Louis A. Stanton of the U.S. District Court for the Southern District of New York granted the application of the Securities Investor Protection Corporation for a decree adjudicating that the customers of BLMIS are in need of the protection afforded by the Securities Investor Protection Act of 1970. Irving H. Picard, Esq., was appointed as trustee for the liquidation of BLMIS, and Baker & Hostetler LLP was appointed as counsel. Mr. Madoff, if found guilty of all counts, would be imprisoned for 150 years, but legal experts expect the actual sentence to be much lower and would still be an effective life sentence for the 70- year-old defendant, WSJ notes. Mr. Madoff, WSJ relates, would also face millions of dollars in possible criminal fines. The report says that Mr. Madoff has been free on bail since his arrest on December 11, 2008. There was no plea agreement with Mr. Madoff in which leniency in sentencing might be recommended, the report states, citing prosecutors. BROWN SHOE: S&P Changes Issue-Level Rating to 'B' From 'B-' ----------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its issue- level rating on Brown Shoe to 'B' from 'B-' and revised the recovery rating to '4' from '5'. At the same time, S&P affirmed all other ratings, including the 'B' corporate credit rating. The upgrade reflects S&P's estimation that additional value is likely to be available based on S&P's discreet asset valuation. The outlook is negative. "The speculative-grade ratings on Brown Shoe reflect our analysis of the company's participation in the mature, competitive, and fragmented wholesale and retail footwear business; recent weak operating performance; low operating margins relative to those of its peers; and credit protection measures that are somewhat below average for the rating category," said Standard & Poor's Credit Analyst David Kuntz. S&P expects operations to remain particularly challenged over the near term. The significant drop in consumer spending is likely to result in moderately negative same-store sales. Furthermore, S&P believes operational deleveraging will likely pressure margins over the next year, despite the company's earnings enhancement plan and restructuring activities. Total revenues declined 3.7% for the 12 months ended May 2, 2009. Same-store sales were down 4.9% at Famous Footwear, and wholesale revenues declined 5% for the first quarter. Following the trend over the past year, margins continued to sink, falling to 10.3% range for the year from 12.3% for the prior-year period because of increased promotions, shifts in sales mix, and expense deleveraging. BRYANT KEITH PETERS: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Joint Debtors: Bryant Keith Peters aka Atlantis Construction & Development Corporation aka La Plata Enterprises, LLC April Dawn Peters 2856 North Gregg Drive Flagstaff, AZ 86001 Bankruptcy Case No.: 09-12712 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Chief Judge Redfield T. Baum PCT Sr. Debtors' Counsel: James F. Kahn, Esq. 301 E. Bethany Home Rd., #C-195 Phoenix, AZ 85012 Tel: (602) 266-1717 Fax: (602) 266-2484 Email: james.kahn@azbar.org Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by the Joint Debtors. BUTLER SERVICES: Donlin Recano Retained as Claims Agent ------------------------------------------------------- Donlin, Recano and Company, Inc., the bankruptcy management consultancy, will provide claims, noticing and balloting services to Butler Services International, Inc., in the Company's Chapter 11 filing. Donlin Recano -- http://www.donlinrecano.com-- is the leading claims management company that has served over 200 national clients across a broad range of industries and business sectors. Working with counsel, turnaround advisors and the affected company, Donlin Recano helps organize and guide Chapter 11 clients through administrative bankruptcy tasks, including provision of Web site-accessible information, formation of professional call centers, management of claims, balloting, distribution and other administrative services. The company also provides similar services to creditor committees of clients in an effort to comply with The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. About Butler International Headquartered in Ft. Lauderdale, Florida, Butler International, Inc. -- http://www.butler.com/-- provides Engineering and Technical Outsourcing Services, helping customers worldwide increase performance and savings. Butler International's global services model provides clients with onsite, offsite, or offshore service delivery options customized appropriately to their unique objectives. During its 62-year history of providing services, Butler International has served many prestigious companies through its industry groups, which include clients in the aircraft/aerospace, federal/defense, communications, consumer and manufacturing and commercial sectors. At September 30, 2007, the Company had $118,755,000 in total assets, $100,224,000 in total liabilities, and $18,531,000 in total stockholders' equity. For the nine month period then ended, the Company reported a net loss of $4,221,000 on net sales of $236,361,000. The Company has not filed its annual reports for 2007 and 2008 with the Securities and Exchange Commission. The Company and its affiliates filed for Chapter 11 bankruptcy protection on June 1, 2009 (Bankr. D. Delaware Case No. 09-11914). Charlene D. Davis, Esq., at Bayard, P.A., assists the Company in its restructuring efforts. The Company listed $50,000,001 to $100,000,000 in assets and $50,000,001 to $100,000,000 in debts. CAPMARK FINANCIAL: Inks 2nd Supplemental Indenture with Deutsche ---------------------------------------------------------------- Capmark Financial Group Inc. entered into a second supplement to the indenture dated May 10, 2007, with Deutsche Bank Trust Company Americas as trustee for: -- Floating Rate Senior Notes due 2010; -- 5.875% Senior Notes due 2012; and -- 6.300% Senior Notes due 2017. The Supplemental Indenture for each of the 2010 Senior Notes, the 2012 Senior Notes and the 2017 Senior Notes amend the existing indentures for those Notes solely to add certain additional subsidiaries of the Company as guarantors of those Notes. A full-text copy of the Floating Rate Senior Notes due 2010 Second Supplemental Indenture is available for free at: http://ResearchArchives.com/t/s?3dc5 A full-text copy of the 5.875% Senior Notes due 2012 Second Supplemental Indenture is available for free at: http://ResearchArchives.com/t/s?3dc6 A full-text copy of the 6.300% Senior Notes due 2017 Second Supplemental Indenture is available for free at: http://ResearchArchives.com/t/s?3dc7 About Capmark Based in Horsham, Pennsylvania, Capmark Financial Group Inc. -- http://www.capmark.com/-- is a diversified company that provides a broad range of financial services to investors in commercial real estate-related assets. Capmark has three core businesses: lending and mortgage banking, investments and funds management, and servicing. Capmark operates in North America, Europe and Asia. * * * As reported by the TCR on Apr. 30, 2009, Moody's Investors Service downgraded the senior unsecured ratings of Capmark Financial Group Inc. to 'Caa1' from 'B2', with the rating remaining under review for possible downgrade. The rating action reflects the explanatory note in Capmark's 10-K filing in which its auditors raise doubt about the company's ability to continue as a going concern, as well as the still unresolved nature of Capmark's efforts to modify the terms of its bridge loan agreement and senior credit facility, which could have implications for its liquidity and funding. CAR WASH HOLDING: Case Summary & 11 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Car Wash Holding Corporation, LLC 457 State Avenue Beaver, PA 15009 Bankruptcy Case No.: 09-24320 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Western District of Pennsylvania (Pittsburgh) Debtor's Counsel: Edgardo D. Santillan, Esq. Santillan & Associates,P.C. 650 Corporation Street, Ste 304 Beaver, PA 15009 Tel: (724) 770-1040 Fax: (412) 774-2266 Email: edscourt@debtlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 11 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/pawb09-24320.pdf The petition was signed by Ralph O. Esposito, president of the Company. CB RICHARD: S&P Affirms Counterparty Credit Rating at 'BB/B' ------------------------------------------------------------ Standard & Poor's Ratings Services said that it affirmed its ratings, including the 'BB/B' counterparty credit rating, on U.S.- based real estate services company CB Richard Ellis Services Inc. and assigned a 'B+' rating to CBRE's announced $400 million senior subordinated notes due 2017. S&P assigned the senior subordinated notes a recovery rating of '6', reflecting S&P's expectation that lenders would realize negligible (0%-10%) recovery of principal in the event of a payment default. The outlook is negative. "Our ratings on CBRE are based on the company's position as the world's largest CRE services company; its aggressive financial management, highlighted by weak debt service coverage and negative tangible equity; and the sensitivity of its financial performance to highly-cyclical CRE sales and leasing transaction volume," said Standard & Poor's credit analyst Rian M. Pressman, CFA. S&P believes that the capital plans CBRE announced will reduce the liquidity overhang that had been created by the material near-term amortization of its credit facilities. Moreover, it will create additional covenant cushion because, per prior amendments, the principal and interest associated with the issuance will not be counted in the covenant calculations. CBRE plans to issue $400 million of senior subordinated debt to pay down and facilitate the modification of existing senior secured credit facilities. The company also announced that it had recently raised $100 million of common stock and plans to raise an additional $50 million in the near term. Although the actions announced will materially reduce debt amortization thru 2011, S&P expects debt service to remain under considerable pressure. S&P expects CBRE's total debt and associated interest expense to remain virtually unchanged after the transaction. Moreover, S&P expects earnings from transactional businesses to remain depressed because of the cyclical downturn of the global CRE markets. Management's ability to offset this decline partially through operating expense savings (targeted at nearly $500 million versus 2007 levels) and stabilize CBRE's already weak debt service will be crucial to maintaining the current rating. The negative outlook reflects the expected weakening of CBRE's financial profile and S&P's concern about potential further deterioration as a result of the cyclical downturn in global CRE markets. If profitability erodes materially, CBRE may be challenged to maintain debt service coverage that is adequate for the rating. Over the longer term, if management reduces total debt and improves debt service coverage, S&P could revise the outlook to stable. CB RICHARD: Moody's Affirms Senior Debt Rating at 'Ba2' ------------------------------------------------------- Moody's Investors Service affirmed the senior debt rating of CB Richard Ellis Services Inc. at Ba2 and assigned a Ba3 rating to its recently announced senior subordinated debt. The rating outlook remains negative. The ratings reflect CBRE's sound franchise and leadership position in the commercial real estate services sector, its diversified revenue stream and its recent growth in annuity-like businesses. The ratings and the negative outlook continue to reflect the high leverage levels which are expected to remain, at a minimum, at current levels over the intermediate term as a result of the protracted credit crisis and current economic conditions (both in the US and globally). Furthermore, CBRE's real estate services business is highly correlated with real estate and economic cycles, especially its transactional businesses. As a result, CBRE's net debt to EBITDA increased to 5.7X at 03/31/09, a material increase from 3.4X at 03/31/08 and interest coverage declined to 3.2X at 03/31/09 from 5.2X at 03/31/08. The pressure on the company's operating performance also caused a deterioration in CBRE's debt covenant cushions, particularly its leverage covenant. This pressure has been alleviated by the recent amendment to its credit agreement which provided more room under its leverage and coverage covenants, and by the issuance of $100 million of equity. Moody's expects CBRE's metrics to remain strained over the foreseeable future until the credit markets begin to thaw. Positively, Moody's believes the company has adequate liquidity to fund its 2009 debt and operating obligations. A stable rating outlook would be predicated upon a reduction in leverage (net debt to EBITDA) closer to 3X as well as debt as a percentage of assets approaching 40%, with consistent recurring EBITDA margins of at least 12%. Sustained deterioration in operating performance resulting in recurring EBITDA margins below 10%, further deterioration in its bank line covenant cushion, or any increase in debt (beyond $2.2 billion) would result in a downgrade. This rating was assigned with a negative outlook: * CB Richard Ellis Services, Inc. -- senior subordinated debt at Ba3 These ratings were affirmed with a negative outlook: * CB Richard Ellis Services, Inc. -- senior secured bank credit facility at Ba2 Moody's last rating action with respect to CB Richard Ellis was on February 12, 2009 when Moody's downgraded the senior debt rating to Ba2 from Ba1. CB Richard Ellis Services, Inc. is the largest global provider of commercial real estate services. Services it provides include property sales/leasing brokerage, property management, corporate services and facilities management, capital markets advice and execution, appraisal/valuation services, research and consulting. CB Richard Ellis is headquartered in Los Angeles, California, USA, and has approximately 29,000 employees and over 300 offices across more than 50 countries. CB Richard Ellis' ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of CB Richard Ellis' core industry and the company's ratings are believed to be comparable to those of other issuers of similar credit risk. CHARTER COMMUNICATIONS: Shareholder Wants Equity Committee ---------------------------------------------------------- Q Investments, L.P., which holds approximately 4.7% of the outstanding Class A common stock of Charter Communications, Inc., asks the U.S. Bankruptcy Court for the Southern District of New York to compel the U.S. Trustee to appoint a committee of equity security holders in the Chapter 11 cases of Charter Communications and its debtor affiliates. Q Investments contends that the Debtors are attempting to fast track a prearranged plan negotiated among only the Debtors, their controlling shareholder Paul Allen and certain of their bondholders or the "Crossover Committee" that would wipe out all of the Debtor's equity holders, except for Mr. Allen. Q Investments says it wrote to the U.S. Trustee on March 18, 2009, requesting that an equity committee be appointed in Charter's bankruptcy case but the request was turned down. Q Investments asserts that under the prearranged plan, the controlling shareholder and members of the Crossover Committee are set up to receive substantial distributions at the expense of Charter's public equity holders. The Debtors, the Crossover Committee and the official committee of unsecured creditors oppose the appointment of an equity committee, asserting that the request is untimely because the disclosure statement has already been approved and the prearranged plan eliminates $8 billion of debt, so that no value exists for current equity holders. As reported in the TCR on May 8, 2009, the Court scheduled the hearing to consider confirmation of the prearranged plan for July 20, 2009. About Charter Communications Based in St. Louis, Missouri, Charter Communications, Inc. (Pink OTC: CHTRQ) -- http://www.charter.com/-- is a broadband communications company and the fourth-largest cable operator in the United States. Charter provides a full range of advanced broadband services, including advanced Charter Digital Cable(R) video entertainment programming, Charter High-Speed(R) Internet access, and Charter Telephone(R). Charter Business(TM) similarly provides scalable, tailored, and cost-effective broadband communications solutions to business organizations, such as business-to-business Internet access, data networking, video and music entertainment services, and business telephone. Charter's advertising sales and production services are sold under the Charter Media(R) brand. On March 16, 2009, Charter Communications filed its annual report on Form 10-K, which contained a going concern modification to the audit opinion from its independent registered public accounting firm. Charter Communications and more than a hundred affiliates filed voluntary Chapter 11 petitions on March 27, 2009 (Bankr. S.D. N.Y. Case No. 09-11435). Pacific Microwave filed for bankruptcy protection on April 20, 2009, disclosing assets of not more than $50,000 and debts of more than $1 billion. The Hon. James M. Peck presides over the cases. Richard M. Cieri, Esq., Paul M. Basta, Esq., and Stephen E. Hessler, Esq., at Kirkland & Ellis LLP, in New York, serve as counsel to the Debtors, excluding Charter Investment Inc. Albert Togut, Esq., at Togut, Segal & Segal LLP in New York, serves as Charter Investment, Inc.'s bankruptcy counsel. Curtis, Mallet-Prevost, Colt & Mosel LLP, in New York, is the Debtors' conflicts counsel. Ernst & Young LLP is the Debtors' tax advisors. KPMG LLP is the Debtors' independent auditors. The Debtors' valuation consultants are Duff & Phelps LLC; the Debtors' financial advisors are Lazard Freres & Co. LLC; and the Debtors' restructuring consultants are AlixPartners LLC. The Debtors' regulatory counsel is Davis Wright Tremaine LLP, and Friend Hudak & Harris LLP. The Debtors' claims agent is Kurtzman Carson Consultants LLC. As of March 31, 2009, the Debtors had total assets of $13,650,000,000, and total liabilities of $24,501,000,000. Bankruptcy Creditors' Service, Inc., publishes Charter Communications Bankruptcy News. The newsletter tracks the Chapter 11 proceedings undertaken by Charter Communications and more than 100 of its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: Settles Preliminary Injunction Against Logghe ----------------------------------------------------------- Chrysler LLC and its debtor-affiliates negotiated with Logghe Stamping Co. to resolve their request to the U.S. Bankruptcy Court for the Southern District of New York for a preliminary injunction to immediately enjoin Logghe Stamping from continuing to violate the automatic stay by withholding certain tools. To avoid further expense and the risk of protracted litigation, the Parties entered into an agreement, which the Court approved, providing that: -- The Tools belong to Chrysler and are property of Chrysler's estate pursuant to Section 541(a) of the Bankruptcy Code; -- Starting June 9, 2009, the balance of Tools that were not removed will be staged by Logghe for transport by the Debtors to its new suppliers according to this timetable: Date Staging/Pickup Tools ---- -------------- ----- 6/09/09 Pickup Production weld fixtures; miscellaneous production requirements 6/09/09 Staging Service parts tools 6/10-11/09 Pickup Service parts tools 6/12/09 Pickup Finished goods; component parts; raw material 6/15/09 Pickup Containers and racks until completed -- Logghe will deliver to the Debtors on or before June 15, 2009, all available paperwork for the "PPAP process" relating to the Tools, and designs for the check fixtures and dies; -- Logghe will cooperate with the Debtors to ensure that the Timetable is met. Cooperation will include, without limitation, removing the Tools from Logghe's presses, disassembling the Tools from Logghe's capital equipment, and removing Logghe's sensors from the Tools; -- Logghe will run two shifts per day Monday through Saturday, and use its best efforts to run a shift or shifts on Sundays, to ensure that the Timetable is met; -- The Debtors will reimburse Logghe for labor costs amounting to $10,000 relating to the removal of the Tools. Logghe will not be required to let any non-Logghe employees work on its equipment; -- In consideration for a release of all liens, claims, encumbrances or similar interests in the Tools, the Debtors will pay Logghe $62,488, which represents all undisputed prepetition amounts that are due and owing to Logghe against which Logghe has asserted a possessory lien under relevant state law, net of all undisputed prepetition amounts that are owed by Logghe to the Debtors, and the purchase of raw material, purchased components and finished goods. The payment will be wired to Logghe on or before June 15, 2009. Logghe will provide its wiring instructions on corporate letterhead; and -- A contemporaneous inventory of the Tools will be conducted as the Tools are staged for removal from Logghe's premises. Upon completion of the removal, a list of Tools provided by Chrysler will be compared to the Inventory, and any discrepancy will be reconciled by agreement of the parties, which may include an additional payment from one party to the other. If the parties cannot agree, the Bankruptcy Court will resolve the dispute. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- manufactures Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The Company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan, and Australia. In 2007, Cerberus Capital Management LP acquired an 80.1% stake in Chrysler for $7.2 billion. Daimler AG kept a 19.9% stake. Pursuant to the U.S. Government's Automotive Industry Financing Program, the U.S. Department of the Treasury made emergency loans to General Motors Corp., Chrysler Holding LLC, and Chrysler Financial Services Americas LLC. The Treasury purchased senior preferred stock from GMAC LLC. In exchange, Chrysler and GM submitted restructuring plans to the Treasury on February 17, 2009. Upon submission, President Obama's Designee on the Auto Industry determined that the restructuring plans did not meet the threshold for long-term viability. However, on March 30, 2009, both GM and Chrysler were granted extensions to complete the restructuring plans to comply with the requirements set forth under the Automotive Industry Financing Program. The U.S. Government told Chrysler March 31, 2009, it would provide up to $6 billion in financing if (i) Chrysler and Fiat SpA could complete a deal by the end of April -- on top of the $4 billion Chrysler has already received -- and (ii) Chrysler would obtain concessions from constituents to establish a viable out-of-court plan. On April 30, Chrysler LLC and 24 affiliates sought Chapter 11 protection from creditors (Bankr. S.D. N.Y (Mega-case), Lead Case No. 09-50002). U.S. President Barack Obama said that Chrysler had to file for bankruptcy after the automaker's smaller lenders, including hedge funds that he didn't name -- "a small group of speculators" -- refused to make the concessions agreed to by the Company's major debt holders and workers. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Chrysler completed the sale of most of its assets to Fiat on June 10, 2009. Chrysler has hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler says that as of December 31, 2008, it had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: Wants to Hire PricewaterhouseCoopers as Tax Advisors ------------------------------------------------------------------ Chrysler LLC and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to employ PricewaterhouseCoopers LLP as their tax advisors, information technology advisors and special accountants in their Chapter 11 cases, nunc pro tunc to their petition date. Holly E. Leese, Esq., the Debtors' senior vice president and general counsel, relates that the Debtors have selected PwC because PwC possesses: (a) a diverse experience and in-depth knowledge in the restructuring field; (b) an understanding of the issues involved in complex chapter 11 cases; and (c) the ability to provide the tax, information technology and special accounting services that will be required in the Debtors' Chapter 11 cases. PwC has acted as tax advisors, information technology advisors and accountants in both in-court and out-of-court restructurings of companies of various sizes across a wide array of industries. PwC's clients include debtors, creditors, corporate parents, financial sponsors and indenture trustees. Ms. Leese notes that PwC has significant experience with the restructuring of underperforming manufacturers in the automotive industry, including Cadence Innovation LLC; Collins & Aikman Corporation; Delphi Corporation; Mark IV Industries, Inc.; Meridian Automotive Systems - Composites Operations, Inc.; Plastech Engineered Products, Inc.; and Tower Automotive, Inc. In addition, Ms. Leese tells the Court that PwC has performed professional services for the Debtors, and their predecessors in interest, since 1996, and as a result, PwC is intimately familiar with the Debtors' history, business operations and capital structure. PwC will provide these services to the Debtors: A. Tax Advisory Services: (1) Assisting with U.S. federal income tax return compliance, which may include: (i) tax return preparation assistance in calculating book to tax differences; (ii) quantification of relevant profit and loss allocations under Sections 704(c) and 704(b) of the Internal Revenue Code; (iii) subpart F income and deemed paid credit computations for Chrysler's foreign subsidiaries; (iv) calculation of foreign tax credit limitations; (v) preparation of various forms and supporting schedules for Chrysler's foreign subsidiaries; and (vi) preparation of the tax basis asset information; (2) Determining filing requirements for federal, international, state and local income taxes; (3) Assisting with examinations by the Internal Revenue Service or foreign tax authorities; (4) Providing foreign source income planning; (5) Assisting with interest expense apportionment review and planning; (6) Conducting expense apportionment review and planning under Section 861 of the Internal Revenue Code; (7) Performing foreign tax credit limitation modeling; (8) Providing state and local tax consultation, analysis, review and documentation, including with respect to: (i) state income tax withholding provisions; (ii) entity level tax analysis; (iii) partnership filing requirements; and (iv) state effective tax rate; and (9) Providing assistance with any other tax compliance and tax consulting matters. B. Information Technology Advisory Services: (1) Providing technology design and security engineering solutions, including: (i) determining security system requirements by interviewing personnel and reviewing documentation; (ii) performing project risk analysis and drafting mitigation recommendations; (iii) drafting technical implementation and integration planning documents; (iv) drafting architectural design documents and assisting with the technical validation; (v) recommending solutions and deployment strategies; (vi) recommending systems test approaches and assisting with test execution; (vii) supporting infrastructure deployment; (viii) coordinating with other managed service providers and facilitating knowledge-transfer; (ix) advising and assisting with capacity planning, scalability and performance analysis; and (x) performing systems analysis and advice on risk mediation; (2) Providing resolution support for information technology outages, including: (i) assisting with the evaluation and assessment of critical infrastructure systems outages and recommending troubleshooting activities as appropriate; (ii) responding to the assessment of problems by identifying management infrastructure components and recommending solutions as appropriate; and (iii) performing periodic assessments of systems and logs to identify potential error conditions and recommend solutions; (3) Assisting in the transition of information technology systems in connection with the consummation of the Fiat Transaction, including activities to maintain the integrity and availability of the Debtors' information maintained on the systems; and (4) From and after the consummation of the Fiat Transaction, assisting the Debtors in addressing these and other information technology issues in connection with the transition services provided between the Debtors and New Chrysler. C. Special Accounting Services: (1) Providing accounting advice and support to the controller's group in conjunction with, but without duplicating the services that will be performed by, Capstone Advisory Group LLC or The Siegfried Group LLP; (2) Supporting the preparation of the U.S. Trustee's reports and other reports required by the Court and, if required, providing factual testimony to the Court; and (3) Assisting management and other professionals with the preparation of certain aspects of bankruptcy schedules of assets and liabilities and statements of financial affairs. The Debtors will pay PwC according to these fee structures: * Tax Advisory Services Tax General Special Position Compliance Planning Planning -------- ---------- -------- -------- Partner $520 $600 $690 Director 380 525 550 Manager 280 350 425 Senior 195 280 300 Staff 140 200 235 * Information Technology Advisory Services will be provided at a blended rate of $205 per hour from April 2009 until March 2010. The maximum fee for time incurred during the period will be $1,458,575. The combined fees for Information Technology Advisory Services and related expenses from April 2009 until March 2010 will not exceed $1,589,846. * Special Accountant Services Position Rate Range -------- ---------- Partners/Managing Directors $650 - $780 Director/Manager 450 - 550 Senior Associate/Associate 250 - 350 Paraprofessional Staff 200 In addition, the Debtors will reimburse PwC for reasonable and documented actual expenses and taxes incurred in the provision of the Services. Perry M. Mandarino, a partner at PwC, assures the Court that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- manufactures Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The Company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan, and Australia. In 2007, Cerberus Capital Management LP acquired an 80.1% stake in Chrysler for $7.2 billion. Daimler AG kept a 19.9% stake. Pursuant to the U.S. Government's Automotive Industry Financing Program, the U.S. Department of the Treasury made emergency loans to General Motors Corp., Chrysler Holding LLC, and Chrysler Financial Services Americas LLC. The Treasury purchased senior preferred stock from GMAC LLC. In exchange, Chrysler and GM submitted restructuring plans to the Treasury on February 17, 2009. Upon submission, President Obama's Designee on the Auto Industry determined that the restructuring plans did not meet the threshold for long-term viability. However, on March 30, 2009, both GM and Chrysler were granted extensions to complete the restructuring plans to comply with the requirements set forth under the Automotive Industry Financing Program. The U.S. Government told Chrysler March 31, 2009, it would provide up to $6 billion in financing if (i) Chrysler and Fiat SpA could complete a deal by the end of April -- on top of the $4 billion Chrysler has already received -- and (ii) Chrysler would obtain concessions from constituents to establish a viable out-of-court plan. On April 30, Chrysler LLC and 24 affiliates sought Chapter 11 protection from creditors (Bankr. S.D. N.Y (Mega-case), Lead Case No. 09-50002). U.S. President Barack Obama said that Chrysler had to file for bankruptcy after the automaker's smaller lenders, including hedge funds that he didn't name -- "a small group of speculators" -- refused to make the concessions agreed to by the Company's major debt holders and workers. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Chrysler completed the sale of most of its assets to Fiat on June 10, 2009. Chrysler has hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler says that as of December 31, 2008, it had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: Wants Siegfried Group to Provide Accounting Services ------------------------------------------------------------------ Chrysler LLC and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to employ The Siegfried Group, LLP, nunc pro tunc to May 19, 2009, as their accounting resource provider in accordance with the terms of the Master Services Agreement between Chrysler and Siegfried dated May 19, 2009. The Debtors anticipate that Siegfried will render various accounting or financial professional resource services to the Debtors as requested throughout the course of the Chapter 11 cases. Siegfried has agreed to: (a) provide assistance with the creation of financial analyses, schedules and management reports, as requested to support, among others, the Debtors' controller's group, other professionals and consultants; (b) assist in the preparation of the schedules of assets and liabilities and the statements of financial affairs in support of and in coordination with the Debtors' other professionals; (c) provide assistance with closing the financial records on a monthly basis and completing related consolidation processes; (d) provide research and interpretation of various accounting pronouncements; (e) provide assistance with the preparation of routine tax schedules and related accounting analyses; (f) provide assistance with the creation, monitoring and delivery of reports to be provided to various parties, including the Debtors and their management, other professionals and stakeholders; and (g) perform other accounting services as may be requested by the Debtors from time to time. The Debtors have separately retained Capstone Advisory Group LLC as their financial advisor, and Epiq Bankruptcy Solutions, LLC as their claims and noticing agent. It is expected that Siegfried will provide day-to-day accounting services that otherwise would be performed by an in-house accounting staff. These services will support the work performed by Capstone and PwC. The Debtors note that the services to be performed by Siegfried will not duplicate any work performed by Capstone, PwC or any other professionals retained by them. In addition, Siegfried will coordinate with the Debtors' other professionals and the Debtors' accounting and financial reporting department to ensure that Siegfried's Services are not duplicative of services provided by PwC, Capstone, Epiq or the Debtors' other professionals. The Debtors will pay Siegfried based on hours charged at Siegfried's standard hourly rates that are in effect when the Services are rendered. Siegfried's current hourly rates are as: Professional Hourly Rates ------------ ------------ Associate/Senior Associate $105 - $125 Associate Manager/Manager $125 - $140 Senior Manager/Associate Director $135 - $150 Director/Senior Director $150 - $170 The Debtors will also reimburse Siegfried for reasonable and actual out-of-pocket expenditures in connection with the provision of Services. The Debtors and Siegfried may terminate the MSA at any time and for any reason upon 30 days written notice. Either party may terminate the MSA for cause in the event the breaching party has not cured its breach of the MSA within 20 days after receipt of a written notice of breach. Siegfried has agreed to waive the exclusive jurisdiction provision in the MSA, which called for all disputes to be heard by Courts of the State of Michigan. Siegfried agrees to submit all matters relating to the employment to the US Bankruptcy Court the Southern District of New York. George A. Siegfried, senior vice president and chief operating officer at Siegfried, discloses that his firm has no connection with the Debtors, their creditors, any other parties-in-interest, their attorneys and accountants, the U.S. Trustee or any person employed in the office of the U.S. Trustee in the Chapter 11 cases. The Debtors have also agreed to indemnify Siegfried against claims, demands, suits or actions for liability, losses, damages or expenses arising from the services provided, but only to the extent the claims are finally determined not to have resulted from Siegfried's gross negligence, intentional misconduct, bad faith or breach of fiduciary duty, if any. A copy of the Master Services Agreement is available for free at http://bankrupt.com/misc/Chrysler_SiegfriedMSA.pdf Siegfried also delivered to the Court a list of interested parties that currently employ or have formerly employed Siegfried in matters unrelated to the Debtors' cases. A full-text copy of the list is available for free at: http://bankrupt.com/misc/Chrysler_Siegfried_Sched2.pdf Mr. Siegfried assures the Court that Siegfried (a) does not hold or represent any interest adverse to the Debtors or their estates and (b) is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The Court will convene a hearing to consider Siegfried's application on June 30, 2009 at 9:30 a.m., (Eastern Time). Objections are due June 19, 2009 at 4:00 p.m., (Eastern Time). About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- manufactures Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The Company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan, and Australia. In 2007, Cerberus Capital Management LP acquired an 80.1% stake in Chrysler for $7.2 billion. Daimler AG kept a 19.9% stake. Pursuant to the U.S. Government's Automotive Industry Financing Program, the U.S. Department of the Treasury made emergency loans to General Motors Corp., Chrysler Holding LLC, and Chrysler Financial Services Americas LLC. The Treasury purchased senior preferred stock from GMAC LLC. In exchange, Chrysler and GM submitted restructuring plans to the Treasury on February 17, 2009. Upon submission, President Obama's Designee on the Auto Industry determined that the restructuring plans did not meet the threshold for long-term viability. However, on March 30, 2009, both GM and Chrysler were granted extensions to complete the restructuring plans to comply with the requirements set forth under the Automotive Industry Financing Program. The U.S. Government told Chrysler March 31, 2009, it would provide up to $6 billion in financing if (i) Chrysler and Fiat SpA could complete a deal by the end of April -- on top of the $4 billion Chrysler has already received -- and (ii) Chrysler would obtain concessions from constituents to establish a viable out-of-court plan. On April 30, Chrysler LLC and 24 affiliates sought Chapter 11 protection from creditors (Bankr. S.D. N.Y (Mega-case), Lead Case No. 09-50002). U.S. President Barack Obama said that Chrysler had to file for bankruptcy after the automaker's smaller lenders, including hedge funds that he didn't name -- "a small group of speculators" -- refused to make the concessions agreed to by the Company's major debt holders and workers. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Chrysler completed the sale of most of its assets to Fiat on June 10, 2009. Chrysler has hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler says that as of December 31, 2008, it had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRSYLER LLC: Dollar Thrifty Discloses Updated Exposure ------------------------------------------------------- Dollar Thrifty Automotive Group, Inc. (NYSE: DTG) provided an update on its credit exposure to Chrysler LLC, which has declined significantly due to payments received since the commencement of the Chrysler LLC's bankruptcy proceeding and its successful asset sale. As previously announced, the Company's primary credit exposure to Chrysler relates to residual value guarantees on program vehicles in the Company's rental fleet, as well as on program vehicles that had previously been returned to auction. In connection with the completion of the sale of substantially all of the assets of Chrysler LLC to Chrysler Group LLC, Chrysler Group has agreed, as stated in the bankruptcy court order approving the sale, to assume certain liabilities of Chrysler LLC, including liabilities under residual value guarantees and rebate bonuses offered to fleet customers prior to the closing of the sale with respect to vehicles subject to guaranteed depreciation programs. Based on the assumption of this liability by Chrysler Group, the Company believes that its primary exposure will be fully honored and settled in the ordinary course of business. As of June 10, 2009, the Company's exposures were: * Approximately $6.4 million in trade receivables under incentive and vehicle repurchase programs. * Approximately $250,000 in estimated exposure for residual value guarantees on approximately 40 program vehicles that have been returned to auction but not yet sold. * Approximately $23 million in estimated exposure for residual value guarantees on approximately 3,600 program vehicles currently in the Company's rental fleet. These vehicles are subject to return to auction in the third and fourth quarters of 2009. "We are very pleased that Chrysler completed its asset sale in a way that will allow Chrysler Group and Dollar Thrifty to continue to benefit from our long-term association. The removal of this uncertainty is of significant benefit to Dollar Thrifty and all of our stakeholders," said Scott L. Thompson, President and Chief Executive Officer. "We are particularly pleased that the sale process was handled in a timely way that we have not experienced a negative impact on the residual values of Chrysler products. We look forward to continuing our relationship and expect to be working closely with Chrysler Group in the near future." Dollar Thrifty separately confirmed that it does not have any material exposure to General Motors. About Dollar Thrifty Automotive Group, Inc. Dollar Thrifty Automotive Group, Inc. -- http://www.dtag.com/-- is a Fortune 1000 company headquartered in Tulsa, Oklahoma. The Company's brands, Dollar Rent A Car and Thrifty Car Rental, serve value-conscious travelers in over 70 countries. The Company's approximately 6,800 employees are located mainly in North America, but global service capabilities exist through an expanding international franchise network. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- manufactures Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The Company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan, and Australia. In 2007, Cerberus Capital Management LP acquired an 80.1% stake in Chrysler for $7.2 billion. Daimler AG kept a 19.9% stake. Pursuant to the U.S. Government's Automotive Industry Financing Program, the U.S. Department of the Treasury made emergency loans to General Motors Corp., Chrysler Holding LLC, and Chrysler Financial Services Americas LLC. The Treasury purchased senior preferred stock from GMAC LLC. In exchange, Chrysler and GM submitted restructuring plans to the Treasury on February 17, 2009. Upon submission, President Obama's Designee on the Auto Industry determined that the restructuring plans did not meet the threshold for long-term viability. However, on March 30, 2009, both GM and Chrysler were granted extensions to complete the restructuring plans to comply with the requirements set forth under the Automotive Industry Financing Program. The U.S. Government told Chrysler March 31, 2009, it would provide up to $6 billion in financing if (i) Chrysler and Fiat SpA could complete a deal by the end of April -- on top of the $4 billion Chrysler has already received -- and (ii) Chrysler would obtain concessions from constituents to establish a viable out-of-court plan. On April 30, Chrysler LLC and 24 affiliates sought Chapter 11 protection from creditors (Bankr. S.D. N.Y (Mega-case), Lead Case No. 09-50002). U.S. President Barack Obama said that Chrysler had to file for bankruptcy after the automaker's smaller lenders, including hedge funds that he didn't name -- "a small group of speculators" -- refused to make the concessions agreed to by the Company's major debt holders and workers. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Chrysler completed the sale of most of its assets to Fiat on June 10, 2009. Chrysler has hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler says that as of December 31, 2008, it had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITIGROUP INC: Finalizes Gov't Pact, Starts Public Share Exchange ----------------------------------------------------------------- Citigroup Inc. has finalized a definitive agreement with the U.S. government and will now launch its exchange offers for publicly held convertible and non-convertible preferred and trust preferred securities. Under the agreement, the Government will exchange a portion of its preferred securities with an aggregate liquidation value of up to $25 billion for interim securities and warrants and its remaining preferred securities for trust preferred securities. The public exchange offers are currently scheduled to expire on July 24, 2009, subject to extension by Citigroup. Assuming full participation of holders of convertible and non- convertible public preferred and trust preferred securities in the exchange offers, Citigroup will convert into common shares approximately $58 billion in aggregate liquidation value of preferred stock and trust preferred securities. The exchange offers are subject to a number of conditions, including the closing of the previously announced exchange offers with private holders of its preferred securities and the matching exchange offer with the Government and related regulatory approval of those transactions. Citigroup CEO Vikram Pandit said, "Following completion of the exchange offers, Citi will be among the best capitalized banks in the world. Our employees have worked tirelessly to get Citi fit by taking control of our balance sheet and expenses. Their hard work has helped position the company to withstand a challenging market environment and to return to sustained profitability. We have the right strategy, the right structure and the right people. I'm confident that we will continue to make progress and that the strength of our franchise will be evident as the economy improves." "A great deal has been accomplished over the past year," said Richard Parsons, Citigroup Chairman of the Board. "Citi's management team, led by CEO Vikram Pandit, has clarified the Company's strategy by announcing the Citicorp/Citi Holdings plan, and has taken the tough decisions to downsize the Company and cut expenses significantly. Once this exchange offer is completed, we will also have addressed Citi's financial stability. We have confidence in our management and the future of our institution." "After completion of the exchange offers, our Tangible Common Equity could increase by up to approximately $61 billion, and our Tier 1 Common may increase by up to approximately $64 billion from their respective amounts at March 31, 2009," said Ned Kelly, Citigroup CFO. "These new levels place us squarely among the ranks of the world's best capitalized banks." Tangible Common Equity and Tier 1 Common are non-GAAP financial measures. In connection with the public exchange offers, Citigroup will file two definitive proxy statements with the SEC, updating preliminary versions filed on June 3, 2009. One definitive proxy statement proposes, among other things, to amend Citigroup's Charter and certain certificates of designation to modify the rights of holders of publicly held convertible and non-convertible preferred stock. The record date for holders of publicly held convertible and non-convertible preferred securities entitled to vote on these matters is currently scheduled to be June 16, 2009, which Citigroup will confirm via a press release. The other definitive proxy statement proposes, among other things, to amend Citigroup's Charter to increase the number of authorized shares of its common stock and authorize the Board of Directors the option to execute a reverse stock split of its common stock. The record date for holders of common stock entitled to vote on these matters will be the settlement date for the public exchange offers, which is scheduled to occur shortly after the expiration date. Citigroup's Board of Directors has also unanimously adopted a tax benefits preservation plan to protect the company's ability to utilize certain tax assets. According to U.S. federal income tax rules, Citigroup's use of certain tax assets could be substantially limited if the Company experiences an "ownership change." In general, an ownership change would occur if there were a cumulative change in Citigroup's ownership by "5-percent shareholders" that exceeds 50 percentage points over a rolling three-year period. The tax benefits preservation plan is designed to reduce the likelihood that Citigroup experiences such an ownership change by discouraging any person or group from becoming a 5-percent shareholder and dissuading existing 5-percent shareholders from acquiring more than a minimal number of additional shares of Citigroup's stock. Details of the tax benefits preservation plan are available at: http://ResearchArchives.com/t/s?3dc8 As part of the tax benefits preservation plan, Citigroup's Board of Directors declared, on June 9, 2009, a dividend of one preferred stock purchase right for each outstanding share of common stock and interim securities, which are the securities issued in connection with the exchange offers with the U.S. Government and private holders of Citigroup's preferred stock. The dividend will be payable to holders of record as of the close of business on June 22, 2009, and shares of Citigroup common stock and interim securities issued after that date will also receive stock purchase rights. The Stock Purchase Rights will be triggered in any instance of a person becoming an "Acquiring Person" as defined in the plan. If triggered, each Right entitles the holder, other than the person or group that caused the Rights to become exercisable, to purchase the preferred stock or an underlying common stock equivalent at a 50 percent discount to the then market price of the common stock; and the Rights owned by the acquiring person or group become void. Alternatively, if the rights are triggered, Citigroup's Board of Directors may decide instead to exchange all or part of the exercised Rights, other than those held by the acquiring person, for shares of common stock. The tax benefits preservation plan will be in effect for 36 months, in contrast to traditional rights plans that generally last 10 years. Additionally, the plan does not apply to U.S. Government acquisitions of Citigroup common stock. Exchange Offer Timeline Note: Timing is estimated and is subject to change. Timing Action ------ ------ June 16, 2009 Record Date for Preferred Proxy Statement and Exchange Offer June 17-18, 2009 File definitive Preferred Proxy Statement and Common Proxy Statement. July 24, 2009 Currently Scheduled Expiration Date for Exchange Offer After the Expiration Date but Execute amendments Before the Settlement Date delineated in Preferred Proxy Statement July 29, 2009 Currently anticipated Settlement Date for Exchange Offer Common Stock issued is distributed to Voting Trust Record Date for Common Proxy Statement Mail Common Proxy Statements to Common Stock holders July 30, 2009 Currently anticipated date for distribution of Common Stock to Exchange Offer participants by Voting Trustee At least 20 Business Days after Proxies to execute Common Proxy Statement is mailed consents in respect to Common Stockholders to Common Proxy Statement are exercised when requisite number obtained After approval and filing of Conversion of interim Authorized Share Increase with securities held by the USG the Secretary of State of Delaware and Private Holders into Common Stock After completion of the exchange offers, Citigroup's TCE could increase by up to approximately $61 billion and its Tier 1 Common could increase by up to approximately $64 billion, in each case, as of March 31, 2009, on a pro forma basis. TCE, as defined by Citigroup, represents common equity less goodwill and intangible assets (excluding mortgage servicing rights) net of the related deferred tax liabilities. Other companies may calculate TCE in a manner different from Citigroup. Citigroup's TCE was $30.9 billion at March 31, 2009. A reconciliation of Citigroup's total stockholders' equity to TCE is included in: In millions of dollars March 31, 2009 ---------------------- -------------- Total Citi Stockholders' Equity $143,934 Preferred Stock (74,246) Common Equity $69,688 Goodwill (26,410) Intangible Assets (excluding MSRs) (13,612) Related net deferred tax liabilities 1,254 Tangible Common Equity (TCE) $30,920 Tier 1 Common is defined as Tier 1 Capital less non-common elements including qualified perpetual preferred stock, qualifying minority interest in subsidiaries and qualifying trust preferred securities. A reconciliation of Citigroup's common stockholders' equity, as of March 31, 2009, to Tier 1 Common is included in: In millions of dollars March 31, 2009 ---------------------- -------------- Tier 1 Common Citigroup common stockholders' equity $69,688 Less: Net unrealized gains (losses) on securities available-for-sale, net of tax (1) (10,040) Less: Accumulated net losses on cash flow hedges, net of tax (3,706) Less: Pension liability adjustment, net of tax (2) (2,549) Less: Cumulative effect included in fair value of financial liabilities attributable to credit worthiness, net of tax (3) 3,487 Less: Disallowed deferred tax assets(4) 22,920 Less: Intangible assets: Goodwill 26,410 Other disallowed intangible assets 10,205 Other (870) Total Tier 1 Common $22,091 Qualifying perpetual preferred stock $74,246 Qualifying mandatorily redeemable securities of subsidiary trusts 24,532 Minority interest 1,056 Total Tier 1 Capital $121,925 (1) Tier 1 Capital excludes net unrealized gains (losses) on available-for-sale debt securities and net unrealized gains on available-for-sale equity securities with readily determinable fair values, in accordance with regulatory risk-based capital guidelines. In arriving at Tier 1 Capital, institutions are required to deduct net unrealized losses on available-for-sale equity securities with readily determinable fair values, net of tax. (2) The FRB granted interim capital relief for the impact of adopting SFAS 158. (3) The impact of including Citigroup's own credit rating in valuing liabilities for which the fair value option has been elected is excluded from Tier 1 Capital, in accordance with regulatory risk-based capital guidelines. (4) Of Citigroup's approximately $43 billion of net deferred tax assets at March 31, 2009, approximately $15 billion of such assets were includable without limitation in regulatory capital pursuant to the risk-based capital guidelines, while approximately $23 billion of such assets exceeded the limitation imposed by these guidelines and, as "disallowed deferred tax assets," were deducted in arriving at Tier 1 Capital. Citigroup's other approximately $5 billion of net deferred tax assets at March 31, 2009, primarily represented the deferred tax effects of unrealized gains and losses on available-for-sale debt securities, which are permitted to be excluded prior to deriving the amount of net deferred tax assets subject to limitation under the guidelines. About Citigroup Based in New York, Citigroup Inc. (NYSE: C) -- http://www.citigroup.com/-- is organized into four major segments -- Consumer Banking, Global Cards, Institutional Clients Group, and Global Wealth Management. Citigroup had $2.0 trillion in total assets on $1.9 trillion in total liabilities as of September 30, 2008. As reported in the Troubled Company Reporter on November 25, 2008, the U.S. government entered into an agreement with Citigroup to provide a package of guarantees, liquidity access, and capital. As part of the agreement, the U.S. Treasury and the Federal Deposit Insurance Corporation will provide protection against the possibility of unusually large losses on an asset pool of approximately $306 billion of loans and securities backed by residential and commercial real estate and other such assets, which will remain on Citigroup's balance sheet. As a fee for this arrangement, Citigroup issued preferred shares to the Treasury and FDIC. The Federal Reserve agreed to backstop residual risk in the asset pool through a non-recourse loan. Citigroup is one of the banks that, according to results of the government's stress test, need more capital. CITY CREEK PROPERTY: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Debtor: City Creek Property Holdings, LLC 925 East 900 South Salt Lake City, UT 84105 Bankruptcy Case No.: 09-25962 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Debtor's Counsel: Eric C. Singleton, Esq. The Singleton Group, PLLC 170 South Main Street, Suite 375 Salt Lake City, UT 84101 Tel: (801) 364-5600 Fax: (801) 364-5601 Email: eric@thesingletongroup.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Colette C. Singleton, member of the Company. CMS ENERGY: Fitch Assigns 'BB+' Rating on $300 Mil. Notes --------------------------------------------------------- Fitch Ratings has assigned a 'BB+' rating to CMS Energy Corp.'s $300 million 8.75% senior notes issuance, due June 15, 2019 and $150 million 5.50% convertible senior notes due June 15, 2029. Proceeds from the sales will be used to retire existing debt and for general corporate purposes. The Rating Outlook for CMS is Stable. The ratings for CMS take into account the stable cash flows of its regulated electric and gas utility, Consumers Energy Co. (Consumers; Issuer Default Rating 'BBB-', Stable Outlook, by Fitch). Consumers benefits from solid credit protection measures, stable operating performance and a constructive legislative and regulatory environment in Michigan, as evidenced by state legislation that increases certainty of cost recovery and reduces regulatory lag. CMS is highly dependent on Consumer's cash distributions to service parent debt obligations and pay common dividends. Rating concerns facing CMS relate to the weak and still declining economy in Michigan, driven by the distress of the automotive sector, as well as significant cash contributions (approximately $200 million) to the company's defined benefit pension plan throughout 2009. CMS will fund these contributions with internally generated cash flows, which have benefited from low commodity prices and decreased capital spending. In its November 2008 electric rate case filing, Consumers is seeking regulatory recovery for a majority of these pension expenses, but there may be a lag in the timing of recovery or a deficit in the amount received. While Consumer's service territory has less concentration in the auto sector than does eastern Michigan, there is exposure to the manufacturers and suppliers. On June 1, 2009, General Motors Corp. (GM; IDR rated 'D') filed for Chapter 11 bankruptcy, and on April 30, 2009, Chrysler LLC (IDR rated 'D') filed for Chapter 11 bankruptcy. CMS's average receivables exposure (after-tax) to GM is estimated to be about $2 million, and less than $300,000 for Chrysler. CMS's auto-wide bankruptcy exposure, which includes equipment manufacturers, Tier 1 and other suppliers, is estimated to range between $10 million and $30 million on a pre-tax basis. Furthermore, plant closures or production ramp-downs could reduce load, and the company has forecasted an 11% decline in industrial electric sales in 2009 compared with the prior year. Industrial sales, including the auto sector, comprise approximately 18% of gross margin, or $290 million for 2008. In November 2008, Consumers filed for a $214 million increase in electric rates and an 11% return on equity. Major components of the rate request include $50 million higher O&M expenses, $76 million increase in rate base (net plant and working capital) and $43 million in gross margin, primarily due to customer mix and sales decline in 2009. The utility self-implemented a $179 million rate increase in May and a final order from the Michigan Public Service Commission is due on Nov. 14, 2009. On May 22, 2009, Consumers filed for a $114 million gas rate increase -- $48 million associated with capital investment and cost of capital, $41 million associated with sales recovery, and approximately $25 million related to operations and maintenance, including uncollectibles and pension payments. Consumers also filed for an 11% ROE. If the Commission has not acted on the application within 180 days of the filing, the company may implement an increase up to the full amount of the rate request. CMS is a utility holding company whose primary subsidiary is Consumers, a regulated electric and gas utility serving more than 3.5 million customers in Michigan's Lower Peninsula. CMS also has operations in natural gas pipelines and independent power production. COEUR D'ALLENE: To Exchange $15.9MM Senior Notes for Common Stock ----------------------------------------------------------------- Coeur d'Alene Mines Corporation agreed to exchange $15,916,000 aggregate principal amount of its 1.25% Convertible Senior Notes due 2024 and $8,475,000 of its 3.25% Convertible Senior Notes due 2028 for a number of shares of its common stock, par value $0.01, pursuant to privately negotiated agreements dated June 8, 2009. The Company initially will issue 1,505,211 shares of Common Stock in connection with the agreements. In connection with the exchange of the 2024 Notes, the Company will issue an additional number of shares equal to the excess over 1,062,981 of the number of shares of Common Stock equal to (a)(i) $14,284,610, plus 100% of the accrued and unpaid interest on the 2024 Notes through June 8, 2009, divided by (ii) 97%, divided by (b) the lesser of (i) $13.93 and (ii) the arithmetic mean of the volume-weighted average price for the company's Common Stock for each of the ten consecutive trading days commencing the day after the Initial 2024 Shares are issued. In connection with the exchange of the 2028 Notes, the Company will issue an additional number of shares equal to the excess over 442,230 of the number of shares of Common Stock equal to (a)(i) $5,911,312.50, plus 100% of the accrued and unpaid interest on those 2028 Notes through June 8, 2009, divided by (ii) 97%, divided by (b) the lesser of (i) $13.93 and (ii) the arithmetic mean of the volume-weighted average price for the company's Common Stock for each of the ten consecutive trading days commencing the day after the Initial 2028 Shares are issued. The Company expects the initial shares to be issued on or about June 12 and any additional shares to be issued on or about June 23. Pursuant to an additional privately-negotiated agreement dated June 8, 2009, the company agreed to exchange $9,000,000 of its 3.25% Convertible Senior Notes due 2028 for an aggregate number of shares of its Common Stock equal to (a) $6,210,000, plus 100% of the accrued and unpaid interest on such notes, divided by (b)(i) the arithmetic mean of the volume-weighted average price for the company's Common Stock for each day between June 9, 2009, and June 15, 2009 (ii) divided by 1.05. The Company expects these shares to be issued on or about June 17. The Company said it will issue all shares pursuant to the exemption from the registration requirements afforded by Section 3(a)(9) of the Securities Act of 1933, as amended. About Coeur d'Alene Coeur d'Alene Mines Corp. (NYSE:CDE) (TSX:CDM) -- http://www.coeur.com/-- is the world's largest primary silver producer, as well as a significant, low-cost producer of gold. The Company has mining interests in Nevada, Idaho, Alaska, Argentina, Chile, Bolivia and Australia. * * * As the Troubled Company Reporter reported on May 20, 2009, Standard & Poor's Ratings Services placed its ratings, including its 'CCC' corporate credit rating, on Coeur d'Alene Mines Corp. on CreditWatch with positive implications. The CreditWatch listing reflects S&P's assessment that near term operating cash flow generation will likely increase due to the combination of higher metal volumes and continued favorable gold and silver prices. Idaho-based Coeur d'Alene completed construction of its Palmarejo mine and successfully started operating it in the first quarter of 2009, which is increasing volumes. COLONIAL BANCGROUP: Inks Order With Alabama State and FDIC ---------------------------------------------------------- The Colonial BancGroup Inc. said that its subsidiary Colonial Bank has entered into a stipulation and consent for the issuance of an Order to Cease and Desist with the Federal Deposit Insurance Corporation and the Alabama State Banking Department. Pursuant to the Cease and Desist Order, Colonial agreed to take certain actions intended to address various issues that have impacted the Bank's financial condition and performance. Among other things, the Order generally provides for the ongoing management and oversight of the Bank, an increase in the Bank's capital levels, a reduction in the Bank's level of criticized assets, a reduction in concentrations of credit, and improvement in the Bank's earnings. "We are committed to working with the FDIC and State of Alabama to implement the actions required by the Order. We will do so while continuing to meet the needs of our customers in the communities we serve. Rest assured that we are committed to providing the products, services and responsiveness our customers expect and deserve. This Order does not affect customer deposit accounts or loans," said Lewis Beville, Colonial's President and CEO. "Deposits in Colonial will continue to be covered by FDIC insurance up to $250,000 and on noninterest bearing transaction accounts and interest bearing transaction accounts earning a rate of 0.50 percent or less, insurance is unlimited. While we are dedicated to working to resolve these serious issues, we want our customers to be confident in knowing that Colonial is committed to customer value and delivering the kind of service that's hard to find these days," added Mr. Beville. A full-text copy of the stipulation and consent is available for free at http://ResearchArchives.com/t/s?3dc4 About Colonial Colonial BancGroup operates 353 branches in Florida, Alabama, Georgia, Nevada and Texas with over $26 billion in assets. The Company's common stock is traded on the New York Stock Exchange under the symbol CNB and is located online at www.colonialbank.com In some newspapers, the stock is listed as ColBgp. * * * According to the Troubled Company Reporter on June 11, 2009, Fitch Ratings has downgraded the ratings of The Colonial BancGroup and its subsidiaries following Colonial Bank, CNB's bank subsidiary, entering into an Order to Cease and Desist with the FDIC and the Alabama State Banking Department on June 9, 2009. Fitch has placed the ratings on Rating Watch Evolving. Fitch downgraded Colonial Bank's Colonial Bank's Long-term IDR to 'B-' from 'B+'; Long-term deposits to 'B/RR3' from 'BB-/RR3'; Subordinated debt to 'CC/RR6' from 'B/RR6'; and Individual to 'E' from 'D/E'. COLORADO RESOURCE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Colorado Resource Management, Inc. aka Aspen Excavation and Demolition 400 Merrill Ave Carbondale, CO 81623 Bankruptcy Case No.: 09-21302 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court District of Colorado (Denver) Debtor's Counsel: Shaun A. Christensen, Esq. 600 17th St., Ste. 1800-S Denver, CO 80202 Tel: (303) 573-5900 Email: christensens@appellucas.com Garry R. Appel, Esq. Appel & Lucas, P.C. 1917 Market St., Ste A Denver, CO 80202 Tel: (303) 297-9800 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cob09-21302.pdf The petition was signed by Chayln Perez, president of the Company. CONNACHER OIL: Higher Debt Burden Cues Moody's to Junk Rating ------------------------------------------------------------- Moody's Investors Service lowered Connacher Oil & Gas Limited's Corporate Family Rating to Caa1 from B3, Probability of Default Rating to Caa1 from B3, and US$600 million of second lien senior secured notes due December 2015 to Caa2 (LGD 4, 59%) from B3 (LGD 4, 51%). At the same time Moody's assigned a rating of B1 (LGD2, 11%) to Connacher's proposed US$150 million first lien notes issue. Connacher's Speculative Grade Liquidity rating was raised to SGL-3 from SGL-4, reflecting adequate liquidity for the next twelve to fifteen months. Moody's does not rate Connacher's C$100,050,000 of subordinated unsecured convertible debentures. The rating outlook continues to be negative. The lowering of the ratings reflects the higher debt burden assumed by Connacher through the first lien notes issue and the associated high interest rate anticipated on these notes. Connacher will have very high leverage over the next few years while it completes the ramp up of Pod One and builds Algar. Connacher should, however, have sufficient liquidity over the next twelve to fifteen months to complete Algar and cover its other cash requirements during this period. Moody's estimate that Connacher will have approximately C$900 million of debt and only about C$35-40 million of EBITDA in 2009 if WTI averages approximately $50 for the full year 2009 and currently favorable light/heavy differentials and diluent costs hold. At this price level, interest coverage (EBITDA to interest) will be below 1.0x in each of 2009 and 2010. Improvement in 2010 EBITDA will be highly contingent upon Pod One achieving and sustaining its design capacity of 10,000 barrels per day (bpd) and bitumen prices remaining at or above the levels. The negative outlook reflects Moody's view that Connacher will need additional liquidity later in 2010 to meet its cash requirements and bridge the gap between the final build out of Algar and the successfully ramp-up of that project to full production and cash flow. The Caa1 CFR reflects Connacher's high leverage and debt service cost, small size, and a liquidity position that is likely to periodically be dependent on external sources absent high bitumen prices. The CFR is supported by Connacher's balance sheet cash post-closing of the first lien notes issue, large proven and probable reserve base, and progress in 2009 in ramping up Phase 1 (Pod One) steam-assisted gravity drainage bitumen production. The rating assumes that Connacher is able to ramp up Pod One to approximately its 10,000 barrels per day design capacity and achieve a strong steam-oil ratio on the order of 2.7 to 1. Connacher's SGL-3 Speculative Grade Liquidity rating reflects adequate liquidity over the next twelve to fifteen months. With C$164 million of cash raised from recent equity offering and the proceeds (after OID and fees) of the proposed US$150 million first-lien notes issue, Connacher's will have cash on hand of approximately C$413 million, which should enable the company to fund significant negative free cash flow over the next twelve to fifteen months and meet all of its cash requirements including interest expense, capex, working capital and taxes. Capex for full year 2009 and 2010 will total in excess of C$350 million if Algar goes forward. Capex to complete Algar is estimated to be approximately C$200 million. The company has no external committed liquidity sources, having cancelled its revolving credit facility when the banks refused to grant a deferral or amendment to a pending violation of an interest coverage covenant. As result of the cancellation of the revolver, Connacher is currently not subject to any financial covenants. The company's alternate liquidity is limited as all of its assets have been pledged as security for the first-lien and second-lien notes. Downgrades: Issuer: Connacher Oil and Gas Limited -- Probability of Default Rating, Downgraded to Caa1 from B3 -- Corporate Family Rating, Downgraded to Caa1 from B3 -- Senior Secured Regular Bond/Debenture, Downgraded to a range of Caa2, LGD4, 59% from a range of B3, LGD4, 51% Upgrades: Issuer: Connacher Oil and Gas Limited -- Speculative Grade Liquidity Rating, Upgraded to SGL-3 from SGL-4 Assignments: Issuer: Connacher Oil and Gas Limited -- Senior Secured Regular Bond/Debenture, Assigned a range of 11 - LGD2 to B1 Connacher's ratings were assigned by evaluating factors Moody's believe are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Connacher's core industry and Connacher's ratings are believed to be comparable to those of other issuers of similar credit risk. The last rating action was February 19, 2008, when Moody's lowered Connacher's CFR and PDR from B2 to B3 and its second lien note rating to B3 (LGD 4, 51%) from B2 (LGD 4, 53%). At the time, Moody's lowered Connacher's Speculative Grade Liquidity rating to SGL-4 from SGL-3. The rating outlook was negative. Connacher Oil and Gas Limited, headquartered in Calgary, Alberta, is an oil and gas company with primary focus on the development and production of oil sands. CONNACHER OIL: S&P Affirms Corporate Credit Rating at 'B' --------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' long-term corporate credit and 'BB-' second-lien secured debt ratings on Calgary, Alberta-based Connacher Oil and Gas Ltd. The recovery rating of '1' (indicating very high [90%-100%] recovery in the event of a payment default) on the second-lien secured notes is unchanged. At the same time, Standard & Poor's removed the ratings from CreditWatch with negative implications, where they were placed Feb. 13, 2009. The outlook is stable. Standard & Poor's also assigned its 'BB-' issue rating (two notches higher than the corporate credit rating) and '1' recovery rating to Connacher's proposed US$150 million first-lien secured notes due 2014. "We believe the recently completed equity offering and proposed notes will provide Connacher sufficient liquidity to fund its operations and recommence construction on Algar into 2010 providing the company with some financial stability which S&P views as a positive for the credit," said Standard & Poor's credit analyst Jamie Koutsoukis. "However, Connacher remains highly leveraged; and should the cost of Algar increase, or expected cash flow from operations deviate meaningfully from S&P's expectations, a negative rating action is likely," Ms. Koutsoukis added. Connacher is an oil and natural gas exploration and production company whose principal asset is its 100% interest in approximately 98,000 acres of oil sands leases in the Great Divide and 50% interest in Halfway Creek regions near Fort McMurray, Alta. Production from Connacher's first pod began during third- quarter 2007 and should reach 10,000 barrels per day (bbl/d) of bitumen in July 2009. Connacher also has conventional operations primarily at Battrum, Sask.; and Marten Creek, Simonette, and Three Hills, Alta., with production of 3,318 barrels of oil equivalent per day in first-quarter 2009 (ended March 31). The company operates a 9,500 bbl/d refinery in Great Falls, Mont., and owns about 24% of Petrolifera Petroleum Ltd. The stable outlook reflects S&P's expectation that Connacher will have sufficient liquidity to fund its operational requirements into 2010 and proceed with reinstating its construction of Algar. However, S&P does not expect that the company's balance sheet will materially improve in the near-to-medium term, so the outlook's timeframe is only six to nine months. Should Connacher encounter pressure on its liquidity due to project cost escalations at Algar, or if heavy oil prices meaningfully fall from the levels and resultantly expected cash flow from Connacher operating assets declines, a negative rating action could occur. Conversely, an outlook revision to positive is unlikely until Algar is completed and producing. Such an outlook revision depends on the company's ability to significantly reduce its debt, combined with improvements in free cash flow generation. COOPER TIRE: Moody's Affirms Junk Rating on Unsecured Notes ----------------------------------------------------------- Moody's Investors Service confirmed Cooper Tire & Rubber Company's Corporate Family and Probability of Default Ratings at B3; and confirmed the rating of the company's unsecured notes at Caa1. The company's Speculative Grade Liquidity Rating is affirmed at SGL-3. The outlook is negative. This action concludes the review initiated on February 2, 2009. The confirmation of Cooper Tire's B3 Corporate Family Rating reflects the company's adequate liquidity profile and Moody's belief that the company's pricing and restructuring actions in 2008 will partially mitigate further reductions in North American replacement tire demand in 2009. The company's more recent actions, including the closure of its Albany, Georgia facility, are also expected to help offset industry pressures. Lower raw material prices should positively affect operating results, as the company uses the LIFO (last-in-first-out) inventory accounting method for its U.S. inventory. Cooper Tire's strong cash balances continue to provide a degree of financial flexibility over the near term. The negative outlook considers ongoing demand pressure in the North American replacement tire markets which is expected to result in another year of negative growth. As a result, Cooper Tire will continue to have weak credit metrics for the assigned rating over the near-term. As of March 31, 2009, the company's EBIT/interest expense (including Moody's standard adjustments) was negative 0.7x. While there is some evidence of passenger car- miles driven stabilizing in 2009, economic and employment conditions in the U.S. may continue to negatively affect consumer driving patterns and limit replacement tire demand. In addition, competitive pricing pressures may offset the potential margin improvement. These conditions, along with approximately $97 million of unsecured notes at the parent company due in December 2009, may limit the company's liquidity in 2010, further pressuring the company's ratings. Cooper Tire's Speculative Grade Liquidity rating of SGL-3 continues to represent the expectation of adequate liquidity over the next twelve months. At March 30, 2009, the company had approximately $233 million of cash and cash equivalents. Moody's believes that the company will have sufficient liquidity to retire the remaining $97 million of 7.75% unsecured notes due in December 2009, after consideration of the potential negative free cash flow over the remainder of 2009. Much of the other short-term debt relates to the company's Asian joint venture operations, which is expected to be refinanced locally. There are no financial covenants under the company's $200 million asset based revolving credit facility nor the $125 million accounts receivable securitization facility. As of March 31, 2009, Cooper Tire had borrowing capacity of $240 million under the combined asset based revolving credit and accounts receivable securitization facilities. The accounts receivable securitization facility matures in September 2010 and the asset based revolving credit matures in November 2012. Cooper Tire also has some ability to develop incremental alternate liquidity under the lien baskets of its unsecured notes. Ratings Confirmed: -- Corporate Family Rating, B3: -- Probability of Default, B3: -- Senior unsecured Notes, Caa1 (LGD4, 63%); -- Shelf filing for unsecured notes, (P)Caa1 (LGD4, 63%); -- Shelf filing for preferred stock, (P)Caa2 (LGD6 97%) Rating Affirmed: -- Speculative Grade Liquidity Rating, SGL-3; Cooper Tire's revolving credit facility is not rated. The last rating action was on February 2, 2009 at which time the Corporate Family Rating was lowered to B3 and the ratings were placed under review for further downgrade. Cooper Tire & Rubber Company, headquartered in Findlay, OH, is the fourth largest tire manufacturer in North America and is focused on replacement markets for passenger cars and light and medium duty trucks. Revenues in 2008 were approximately $2.9 billion. COVENTRY HEALTH: Moody's Affirms Senior Unsecured Debt at 'Ba1' --------------------------------------------------------------- Moody's Investors Service affirmed Coventry Health Care, Inc.'s ratings -- senior unsecured debt at Ba1 and insurance financial strength ratings of its key operating subsidiaries at Baa1-- and changed the outlook to negative from stable. In affirming the ratings, Moody's cited several key factors relating to the company's financial profile that support the current ratings. First, Coventry has a strong liquidity position with $500 million of cash at the parent and a significant stream of unregulated cash flows to meet its interest and expense obligations. Second, Coventry's NAIC risk-based capital ratio is expected to remain strong at approximately 200% of company action level, its level the end of 2008, despite lower earnings. Coventry's announced exit of the Medicare Advantage private fee for service business is expected to result in a release of capital, helping the company to maintain its RBC at this level. Third, while Coventry's financial leverage (debt to capital, where debt includes operating leases) as of March 31, 2009 was relatively high at 38%, the ratio is expected to be lowered to approximately 33% as Coventry has indicated that it intends to repay a portion of its debt from free cash flow during 2009. In addition to these financial measures, the rating agency stated it has a positive view on the company's renewed focus on its core business segments, which has resulted in the exit and sale of some ancillary operations. "The course set by Allen Wise, who replaced Dale Wolf as CEO in January 2009," noted Steve Zaharuk, Moody's VP & Senior Credit Officer, "provides Coventry a reasonable blueprint for re-establishing its business and financial profile under the current challenging economic and political conditions." However, Moody's stated that as a result of the uncertainties and business challenges driven by the current economic and political climate, the rating agency changed the rating outlook to negative from stable. In particular, Coventry's commercial membership is expected to remain pressured as a result of the high unemployment rate and increasing healthcare premiums. In addition, reimbursement cuts for all MA products in 2010 could suppress membership growth on Coventry's MA products. Moody's added that the negative outlook also reflects continued pressure on the company's earnings as a result of issues stemming from its commercial group segment and PFFS business. The company began to see deterioration in the results on these two blocks of business in 2008, and although some corrective operational and pricing actions were taken, financial results are expected to be sub-par for 2009. The rating agency indicated that given the negative outlook, a rating upgrade would be unlikely. However, if Coventry maintains its consolidated NAIC risk-based capital ratio near 200% of company action level, maintains financial leverage in the low 30% range, improves net margins to at least 2%, and successfully exits the Medicare Advantage PFFS business, the outlook may be returned to stable. Conversely, these could result in a rating downgrade: if financial leverage increased above 40%, if RBC fell below 150% CAL, if commercial membership decreased by 10% or more over a twelve month period, if annual net margins fall below 1%, or if Coventry incurred additional operational problems beyond the pricing and underwriting issues identified during 2008. These ratings were affirmed with a negative outlook: -- Coventry Health Care, Inc.: senior unsecured debt rating at Ba1; senior unsecured credit facility at Ba1; corporate family rating at Ba1; senior unsecured shelf rating at (P)Ba1; -- HealthAssurance Pennsylvania, Inc: insurance financial strength rating at Baa1; -- HealthAmerica Pennsylvania, Inc.: insurance financial strength rating at Baa1; -- Group Health Plan, Inc.: insurance financial strength rating at Baa1. Coventry Health Care, Inc., headquartered in Bethesda, Maryland reported medical membership of 3.7 million and Part D Medicare membership of approximately 1.5 million as of March 31, 2009. The company reported net income of $44 million on revenues (including investment income) of approximately $3.6 billion for the three months ending March 31, 2009. Moody's most recent rating action on Coventry was on August 22, 2007, when Moody's assigned a Ba1 senior unsecured debt rating to Coventry's $300 million of new debt securities. Moody's insurance financial strength ratings are opinions about the ability of insurance companies to punctually pay senior policyholder claims and obligations. CRESCENT RESOURCES: Case Summary & 30 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Crescent Resources, LLC 400 South Tryon Street Charlotte, NC 28285 Bankruptcy Case No.: 09-11507 Debtor-affiliates filing subject to Chapter 11 petitions: Entity Case No. ------ -------- Crescent 210 Barton Springs, LLC 09-11504 Cornerstone Plaza, LLC 09-11505 Crescent Holdings, LLC 09-11506 Palmetto Bluff Club, LLC 09-11509 1780, LLC 09-11510 Palmetto Bluff Development, LLC 09-11511 Crescent Southeast Club, LLC 09-11512 223 Developers, LLC 09-11513 Palmetto Bluff Investments, LLC 09-11514 Crescent Twin Creeks, LLC 09-11515 Ballantyne Properties, LLC 09-11516 Palmetto Bluff Lodge, LLC 09-11517 Palmetto Bluff Real Estate Company, LLC 09-11518 Palmetto Bluff Uplands, LLC 09-11519 Bartram Crescent Development, LLC 09-11520 Panama City Development, LLC 09-11521 Parkside Development, LLC 09-11522 Piedmont Row Development, LLC 09-11523 Crescent/Arizona, LLC 09-11524 Portland Group, LLC 09-11525 Black Forest on Lake James, LLC 09-11526 Rim Golf Investors, L.L.C. 09-11527 Crescent/Florida, LLC 09-11528 Bridgewater Lakeland Developers, LLC 09-11529 River Paradise, LLC 09-11530 Crescent/Georgia, LLC 09-11531 Crescent/RGI Capital, LLC 09-11532 Roberts Road, LLC 09-11533 Brooksville East Developers, LLC 09-11534 Falls Cove Development, LLC 09-11535 Sailview Properties, LLC 09-11536 Camp Lake James, LLC 09-11537 Seddon Place Development, LLC 09-11538 FP Real Estate One L.L.C. 09-11539 Springfield Crescent, LLC 09-11540 Grand Haven Developers, LLC 09-11541 Carolina Centers LLC (NC) 09-11542 StoneWater Bay Properties, LLC 09-11543 Grand Woods Developers, LLC 09-11544 Stratford on Howard Development, LLC 09-11545 Sugarloaf Country Club, LLC 09-11546 Green Fields Investments LLC 09-11547 Sugarloaf Properties, LLC 09-11548 Chaparral Pines Investors, L.L.C. 09-11549 Gulf Shores Waterway Development, LLC 09-11550 Sugarloaf Realty, LLC 09-11551 Carolina Centers, LLC (DE) 09-11552 Hammock Bay Crescent, LLC 09-11553 The Farms, LLC 09-11554 Hampton Lakes, LLC 09-11555 Chaparral Pines Management, LLC 09-11556 The Oldfield Realty Company, LLC 09-11557 Hampton Ridge Developers, LLC 09-11558 The Parks at Meadowview, LLC 09-11559 Hawk's Haven Developers, LLC 09-11560 The Parks of Berkeley, LLC 09-11561 Hawk's Haven Golf Course Community Developers 09-11562 Chapel Cove at Glengate, LLC 09-11563 The Point on Norman, LLC 09-11564 The Ranch at the Rim, LLC 09-11565 Citall Development, LLC 09-11566 Hawk's Haven Sponsor, LLC 09-11567 The Reserve, LLC 09-11568 Clean Water of NC, LLC 09-11569 Headwaters Development Limited Partnership 09-11570 The Retreat on Haw River, LLC 09-11571 CLT Development, LLC 09-11572 The River Club Realty, LLC 09-11573 Park/Marsh, LLC 09-11574 Club Capital, LLC 09-11575 The River Country Club, LLC 09-11576 Club Enterprises, LLC 09-11577 The Sanctuary at Lake Wylie, LLC 09-11578 Joint Facilities Management, LLC 09-11579 Trout Creek Developers, LLC 09-11580 Lake George Developers, LLC 09-11581 Tussahaw Development, LLC 09-11582 Twin Creeks Holdings, Ltd. 09-11583 LandMar Group, LLC 09-11584 Club Villas Developers, LLC 09-11585 Twin Creeks Management, LLC 09-11586 LandMar Management, LLC 09-11587 Twin Creeks Operating Co., L.P. 09-11588 Colbert Lane Commercial, LLC 09-11589 Twin Creeks Property, Ltd. 09-11590 Crescent Communities N.C., LLC 09-11591 Two Lake Pony Farm, LLC 09-11592 Winding River, LLC 09-11593 Lighthouse Harbor Developers, LLC 09-11594 Crescent Communities Realty, LLC 09-11595 May River Forest, LLC 09-11596 Crescent Multifamily Construction, LLC 09-11597 Crescent Communities SC, LLC 09-11598 May River Golf Club, LLC 09-11599 Crescent Potomac Greens, LLC 09-11600 McNinch-Hill Investments, L.L.C. 09-11601 Crescent Potomac Plaza, LLC 09-11602 Crescent Potomac Properties, LLC 09-11603 Crescent Lakeway, LLC 09-11604 Milford Estates, LLC 09-11605 Crescent Potomac Yard Development, LLC 09-11606 Crescent Lakeway Management, LLC 09-11607 Nine Corporate Centre Holding Company, LLC 09-11608 Crescent Potomac Yard, LLC 09-11609 Crescent Realty Advisors, LLC 09-11610 Crescent Land & Timber, LLC 09-11611 Crescent Realty, LLC 09-11612 North Bank Developers, LLC 09-11613 Crescent River, LLC 09-11614 North Hampton, LLC 09-11615 Crescent Rough Hollow, LLC 09-11616 North River, LLC 09-11617 Crescent Seminole, LLC 09-11618 Old Wildlife Club, LLC 09-11619 Crescent Yacht Club, LLC 09-11620 Oldfield, LLC 09-11621 Osprey Development, LLC 09-11622 Hidden Lake Crescent, LLC 09-11623 Hawk's Haven Joint Development, LLC 09-11624 New Riverside, LLC 09-11625 Type of Business: The Debtors are real estate developers. Chapter 11 Petition Date: June 10, 2009 Court: Western District of Texas (Austin) Judge: Craig A. Gargotta Debtor's Counsel: Eric J. Taube, Esq. erict@hts-law.com Hohmann, Taube & Summers, L.L.P. 100 Congress Ave., Suite 1800 Austin, TX 78701 Tel: (512) 472-5997 Fax: (512) 472-5248 Estimated Assets: More than $1 billion Estimated Debts: More than $1 billion The Debtors' Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Bank of America N.A. Fee $13,568,937 100 SE 2nd Street Miami, FL 33131 Tel: (305) 533-2361 HSD Lakeway Holdings Ltd. Debt $2,393,322 2101 Lakeway Blvd., Ste. 205 Austin, TX 78734 Tel: (512) 306-1444 JHS LLC debt $2,393,322 31200 Via Colianas, Ste. 200 Westlake Village, CA 91362 Tel: (818) 59707545 Morgan Stanley Capital interest $2,050,372 Services Inc. 901 South Bond Street Baltimore, MD 21231 Tel: (410) 435-1862 Blythe Development Co. trade $733,396 1415 East Westinghouse Blvd. Charlotte, NC 28273 Tel: (704) 588-0023 Specialized Services Inc. trade $559,956 23077 Greenfield Road Southfield, MI 48075 Tel: (888) 874-1775 Vankirk Electric Inc. trade $455,545 John S. Clark Compan LLC trade $423,836 HCH Inc. loan $363,881 Kimley-Horn & Associates Inc. trade $313,991 Sunshine State Plumbing trade $252,002 Sunshine State Drywall Inc. trade $251,750 Kearney-Horn & Development Co. trade $235,450 Inc. Florida Roads Contracting Inc. trade $231,189 Ranger Construction Co. Inc. trade $229,372 Rim Chaparral Pines Real litigation $214,437 Estate Services LLC Tri Tech Air Conditioning Inc. trade $206,082 WDG Construction Inc. trade $194,401 Universal Building Supply Inc. trade $191,776 Town of Payson assessment $184,849 L M McLamb & Son Construction trade $175,089 Inc. North Florida Framing Inc. trade $162,165 North America Lawn & Landscape trade $154,313 Ed Taylor Construction South trade $147,334 Inc. Town Hall Amenities Center trade $116,429 Taurus Painting Inc. trade $112,548 Colejenest & Stone, PA trade $98,350 Sandpiper Synergies LP loan $97,801 Indigo Forestry, Golf & trade $96,986 Grading Inc. Hofer Builders Inc. trade $95,756 The petition was signed by Kevin H. Lambert, chief financial officer. DALE C. DEL BELLO: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Joint Debtors: Dale C. Del Bello Terry F. Del Bello aka Terry Jenkins 18212 Sunset Blvd. Redington Shores, FL 33708 Bankruptcy Case No.: 09-12208 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtors' Counsel: Buddy D. Ford, Esq. 115 N. MacDill Avenue Tampa, FL 33609-1521 Tel: (813) 877-4669 Fax: (813) 877-5543 Email: Buddy@tampaesq.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtors did not file a list of their 20 largest unsecured creditors when they filed their petition. The petition was signed by the Joint Debtors. DENNIS ALEX LUCERO: Case Summary & 2 Largest Unsecured Creditors ---------------------------------------------------------------- Joint Debtors: Dennis Alex Lucero, Sr. aka Dennis A. Lucero, Sr. Dyan Lynn Lucero aka Dyan Lucero aka Diane Lucero 19651 Chuparosa Road Apple Valley, CA 92307 Bankruptcy Case No.: 09-22776 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Central District of California (Riverside) Judge: Richard M. Neiter Debtors' Counsel: Sandford Frey, Esq. 633 W Fifth St 51st Fl Los Angeles, CA 90071 Tel: (213) 614-1944 Email: Sfrey@cmkllp.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtors' petition, including a list of their 2 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cacb09-22776.pdf The petition was signed by the Joint Debtors. DESIGNERS CHOICE: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Designers Choice Cabinetry, Inc. fdba Atlantic Cabinets of Brevard, Inc. 100 TGK Circle Rockledge, FL 32955 Bankruptcy Case No.: 09-08105 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Middle District of Florida (Orlando) Debtor's Counsel: Elizabeth A. Green, Esq. Latham Shuker Eden & Beaudine LLP 390 North Orange Avenue, Suite 600 Orlando, FL 32801 Tel: (407) 481-5800 Fax: (407) 481-5801 Email: bankruptcynotice@lseblaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-08105.pdf The petition was signed by James T. Murfin, president of the Company. DOMTAR CORP: S&P Assigns 'BB-' Rating on US$400 Mil. Notes ---------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'BB-' issue-level rating (one notch below the corporate credit rating on the company) to Domtar Corp.'s US$400 million senior unsecured notes due June 2017. S&P assigned a '5' recovery rating to the notes, indicating modest (10%-30%) recovery in the event of default. The proceeds from these notes will be used to replace part of Domtar's 7.875% unsecured notes outstanding due 2011, and for general corporate purposes. "The 'BB' corporate credit rating and negative outlook on Domtar reflect our view of the company's leading market position in the North American uncoated free sheet market and good cost profile," said Standard & Poor's credit analyst Jatinder Mall. "The ratings are constrained, however, by what S&P see as a steady decline in demand for uncoated free sheet market; volatile prices for commodity paper, pulp, and lumber products; and a weak lumber business," Mr. Mall added. Ratings List Domtar Corp. Corporate credit rating BB/Negative/-- Rating Assigned US$400 mil. senior unsecured debt BB- Recovery rating 5 DOUGLAS P. KUDELKA: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Douglas P. Kudelka dba Texas Sports & Specialty Cars dba Expo Classic Cars 5830 Picasso Houston, TX 77096 Bankruptcy Case No.: 09-34102 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Southern District of Texas (Houston) Judge: Jeff Bohm Debtor's Counsel: Larry A. Vick, Esq. Attorney at Law 1143 Heights Blvd. Houston, TX 77008 Tel: (713) 333-6440 Fax: (713) 343-4757 Email: lv@larryvick.com Total Assets: $1,641,538 Total Debts: $1,682,355 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/txsb09-34102.pdf The petition was signed by James T. Murfin, president of the Company. EDWARD M. DELEO: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Joint Debtors: Edward M. DeLeo 9641 Wilshire Lakes Blvd. Naples, FL 34109 Teresa J. DeLeo 3 Summer Hill Court Lafayette Hill, PA 19444 Bankruptcy Case No.: 09-12121 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Middle District of Florida (Ft. Myers) Debtors' Counsel: Buddy D. Ford, Esq. 115 N. MacDill Avenue Tampa, FL 33609-1521 Tel: (813) 877-4669 Fax: (813) 877-5543 Email: Buddy@tampaesq.com Total Assets: $5,354,302 Total Debts: $22,631,359 A full-text copy of the Debtors' petition, including a list of their 16 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-12121.pdf The petition was signed by the Joint Debtors. EMPIRE EQUITIES: Chapter 11 Filing Extended Debtor's Option ----------------------------------------------------------- WestLaw reports that the time for a Chapter 11 debtor-optionee to exercise an option that had not yet expired as of the commencement of its bankruptcy case was extended for period of 60 days after the order for relief, pursuant to 11 U.S.C. Sec. 108(b)(2) which provides that, when the debtor files for bankruptcy just prior to the expiration of any period fixed by applicable non-bankruptcy law or agreement for the filing of any pleading, demand, notice or proof of claim or loss, the curing of any default, or the performance of any other similar act, then that period shall be extended for 60 days after the order for relief. The exercise of the option was in the nature of "any other similar act," as used in Sec. 108(b)(2). Significantly, the optionor had not asserted that the petition, which was filed a mere 39 minutes before the option was set to expire, was filed solely for the purpose of extending the option date by a debtor that was not in any financial distress. In re Empire Equities Capital Corp., --- B.R. ----, 2009 WL 1544394 (Bankr. S.D.N.Y.) (Gropper, J.). The Debtor entered into an option contract to purchase from CapitalSource Finance, LLC and CIG International, LLC, three loans secured by real property located at 423 West Street in Manhattan. The Debtor initially paid $100,000 in advance, with this deposit to be applied against the purchase price at the closing or be retained by the sellers if the transaction did not close. The contract, as originally agreed, had a deadline of March 16, 2009. The Debtor obtained two extensions of the deadline for an additional downpayment of $600,000. The first extension pushed the deadline to April 20, 2009, and the second to April 30, 2009, at 12:00 p.m., time being of the essence. On April 30, 2009, thirty-nine minutes before the closing deadline, the Debtor filed its Chapter 11 bankruptcy petition, without having proffered the purchase price to CapitalSoutce and CIG. The Debtor admitted having filed the petition to use the time that it asserts is provided in Secs. 365 and 108(b) of the Bankruptcy Code to raise the balance of the purchase price, close the transaction and avoid the forfeiture of its downpayment. CapitalSource and CIG contended that neither Secs. 365 nor 108(b) applied under the circumstances of this case and thus that cause existed under Sec. 362(d) to lift the automatic stay. At a minimum, CapitalSource and CIG asserted, the Court should require the Debtor to "reject the contract immediately." CapitalSource Finance, LLC and CIG International, LLC, are represented by Daniel J. Saval, Esq., Jeffrey L. Jonas, Esq., Keith R. Walsh, Esq., at Brown Rudnick, LLP, in Boston, Mass. Empire Equities Capital Corp. sought protection from its creditors under chapter 11 (Bankr. S.D.N.Y. Case No. 09-12751) on April 30, 2009. Mark A. Frankel, Esq., at Backenroth Frankel & Krinsky, LLP, in New York City, represents the Debtor. The Debtor disclosed $8,301,000 in assets and debts totalling $8,913,784 in its bankruptcy papers. A full-text copy of the Debtor's chapter 11 petition, including its list of six-largest unsecured creditors, is available at no charge at: http://bankrupt.com/misc/nysb09-12751.pdf EQUINIX INC: S&P Assigns 'B-' Rating on $325 Mil. 2016 Notes ------------------------------------------------------------ Standard & Poor's Ratings Services said it assigned its 'B-' issue-level and '6' recovery ratings to Foster City, California- based data center and interconnection service provider Equinix Inc.'s $325 million of convertible subordinated notes due 2016. At the same time, S&P affirmed the company's existing ratings, including its 'B+' corporate credit rating. The outlook is stable. Proceeds from the new notes will be used primarily to fund the third and final phase of its New York 4 IBX, the development of IBX expansions in Switzerland, and other selective expansion opportunities. This additional debt will result in some near-term erosion in credit metrics. Leverage for 2008, pro forma for the new financing, was around 6.0x, versus 5.1x on an actual basis. While S&P expects that leverage will improve in 2009 due to growth in the company's cash flows, S&P also anticipates that the company will be net free cash flow negative for 2009, given the significant capital expenditures associated with the its data center expansion plans. "The rating on Equinix reflects its very competitive operating environment, anticipated significant near-term capital requirements, and accompanying high -- albeit improving -- leverage," said Standard & Poor's credit analyst Catherine Cosentino. While the data center business has very limited maintenance capital expenditure requirements, Standard & Poor's expects that the company will remain aggressive in expanding its data center facilities over the next several years, and has plans to add capacity in several markets in the 2009-2010 timeframe, limiting its net free cash flow generating ability. "In addition, shifts in supply/demand conditions could result in lower pricing upon contract renewals," added Ms. Cosentino. It could also potentially heighten monthly cabinet and revenue churn, which currently are about 1.3% and 2.4%, respectively, excluding the European region. F. A. M. M. LLC: Case Summary & 7 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: F. A. M. M., LLC dba The Sideline 880 G Capital Center Boulevard Largo, MD 20774 Bankruptcy Case No.: 09-20450 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court District of Maryland (Greenbelt) Judge: Wendelin I. Lipp Debtor's Counsel: Bennie R. Brooks, Esq. 8201 Corporate Drive, Suite 260 Landover, MD 20785 Tel: (301) 731-4160 Email: bbrookslaw@aol.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 7 largest unsecured creditors is available for free at http://bankrupt.com/misc/mdb09-20450.pdf The petition was signed by Lavar Arrington, president of the Company. FAR EAST: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: Far East One, LLC 5667 East Bent Tree Drive Scottsdale, AZ 85262 Bankruptcy Case No.: 09-12898 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Debtor's Counsel: Scott B. Cohen, Esq. Engelman Berger, P.C. 3636 N. Central Avenue, Suite 700 Phoenix, AZ 85012 Tel: (602) 271-9090 Fax: (602) 222-4999 Email: SBC@ENGELMANBERGER.COM Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Joseph Popo, manager of the Company. FILENE'S BASEMENT: Crown Questions Results of Auction Sale ---------------------------------------------------------- Stanley Chera's Crown Acquisitions objected to the results of last week's auction where Filene's Basement Inc. declared that Men's Wearhouse Inc. made the best offer for its business, Bloomberg's Bill Rochelle reports. The hearing for approval of the sale has been rescheduled, perhaps to June 19, according to Bloomberg. Crown contends that Filene's and the official committee of unsecured creditors violated the court-approved rules for the auction. Crown says that the Company accepted an offer from Men's Wearhouse that entailed purchasing the company through confirmation of a Chapter 11 plan contrary to the Court's order that required bids for the immediate sale of the assets. Crown also contends that Men's Wearhouse didn't submit a bid by the court-imposed deadline. The tardy offer also did not comply with bid requirements, Crown argues. According to Crown, Men's Wearhouse will buy the $15.1 million in secured bank debt, provide $35 million in financing for the remainder of the Chapter 11 case, and provide $62 million in funding for a reorganization plan. As reported in the Troubled Company Reporter on June 10, 2009, Filene's Basement said that an affiliate of Men's Wearhouse emerged as the winning bidder in a nine-hour bankruptcy auction for assets of the off-price chain that was held in Manhattan on Friday. The affiliate is K&G Acquisition Corp. About Filene's Filene's Basement Corp., also called The Basement, is a Massachusetts-based chain of department stores owned by Retail Ventures, Inc. The oldest off-price retailer in the United States, The Basement focuses on high-end goods and is known for its distinctive, low-technology automatic markdown system. As of late 2006, the company operated stores in metropolitan areas of eight U.S. states and Washington, D.C. The chain also uses a 470,000-square-foot (44,000 m2) distribution center in Auburn, Massachusetts. The store's name is derived from the subterranean location of its flagship store, in the basement of the former Filene's department store at Downtown Crossing in Boston, Massachusetts. Filene's Basement, Inc. and its affiliates filed for Chapter 22 on May 4, 2009, (Bankr. D. Del. Case No. 09-11525) James E. O'Neill, Esq., Laura Davis Jones, Esq., Mark M. Billion, Esq., Michael Seidl, Esq. and Timothy P. Cairns, Esq. at Pachulski Stang Ziehl & Jones LLP represents the Debtors in their restructuring effort. The Debtors listed $50,000,001 to $100,000,000 in assets and $100,000,001 to $500,000,000 in debts. Filene's Basement first filed for Chapter 11 bankruptcy protection in August 1999. Filene's Basement was bought by a predecessor of Retail Ventures the following year. As reported by the Troubled Company Reporter on October 23, 2000, the U.S. Bankruptcy Court confirmed Filene's Basement's Amended Joint Plan of Liquidation, filed on June 16, 2000. Retail Ventures in April 2009 transferred the unit to Buxbaum. FOAMEX INT'L: Wayzata Capital Appeals Sale to MaitlinPatterson -------------------------------------------------------------- Wayzata Capital Investment Partners LLC has appealed the U.S. Bankruptcy Court for the District of Delaware's May 27 order authorizing the sale of Foamex International Inc. to MaitlinPatterson and Black Diamond, which won the bidding in last month's reopened auction. As reported in the Troubled Company Reporter on May 29, 2009, MaitlinPatterson and Black Diamond won the bidding for Foamex with a $155 million offer, along with the assumption of some liabilities. Wayzata Capital Investment Partners LLC said its cash bid provides a higher return for creditors. Foamex International Inc. (FMXL) -- http://www.foamex.com/-- headquartered in Media, PA, produces polyurethane foam-based solutions and specialty comfort products. The Company services the bedding, furniture, carpet cushion and automotive markets and also manufactures high-performance polymers for diverse applications in the industrial, aerospace, defense, electronics and computer industries. Foamex and eight affiliates first filed for Chapter 11 protection on September 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693). On February 2, 2007, the U.S. Bankruptcy Court for the District of Delaware confirmed the Debtors' reorganization plan. The Plan became effective and the Company emerged from Chapter 11 bankruptcy on February 12, 2007. Foamex missed $7.3 million in interest payments due at the end of the January 21 grace periods on the Company's $325 million first- lien term loan and the $47 million second-lien term loan. On February 18, 2009, Foamex International Inc. and seven affiliates filed separate voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 09-10560). The Hon. Kevin J. Carey presides over the cases. Ira S. Dizengoff, Esq., Phillip M. Abelson, Esq., and Brian D. Geldert, Esq., at Akin Gump Strauss Hauer, in New York, represent the Debtors as counsel. Mark E. Felger, Esq., and Jeffrey R. Waxman, Esq., at Cozen O'Connor, in Wilmington, Delaware, represent the Debtors as Delaware counsel. Investment banker is Houlihan Lokey; accountant is McGladrey & Pullen LLP; and claims and noticing agent is Epiq Bankruptcy Solutions LLC. Sharon L. Levine, Esq., at Lowenstein Sandler, is counsel to the Official Committee of Unsecured Creditors. David M. Fournier, Esq., Evelyn J. Meltze, Esq., and Leigh-Anne M. Raport, Esq., at Pepper Hamilton LLP, is the Committee's Delaware counsel. As of September 28, 2008, the Debtors had $363,821,000 in assets, and $379,710,000 in debts. FONTAINEBLEAU LAS: Chapter 11 Filing Cues S&P's Rating Cut to 'D' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Las Vegas-based Fontainebleau Las Vegas Holdings LLC to 'D' from 'CCC'. In addition, S&P lowered the issue-level rating on the $1.85 billion senior secured credit facilities borrowed by Fontainebleau Las Vegas LLC and Fontainebleau Las Vegas II LLC, both wholly owned subsidiaries of FLVH, to 'D' from 'CCC'. The recovery rating on the credit facilities was revised to '6', indicating S&P's expectation of negligible (0% to 10%) recovery for lenders in the event of a payment default, from '4'. S&P also lowered the issue-level rating on the $675 million second mortgage notes issued jointly by FLVH and its wholly owned subsidiary, Fontainebleau Las Vegas Capital Corp., to 'D' from 'CC'. The recovery rating on this debt remains unchanged at '6'. The ratings downgrade follows filing for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court in the Southern District of Florida by FLVH, FLVCC, and FLV. "The revision of our recovery rating on the senior secured credit facilities is due to an actual bankruptcy being filed earlier than the simulated default scenario in our most recent recovery analysis had contemplated," explained Standard & Poor's credit analyst Ben Bubeck. "We had contemplated a default occurring in 2010, following the opening of the company's Las Vegas gaming facility. Given the funding requirements remaining to complete the project, which exceed our previous estimates for gross enterprise value of the property, S&P now expects senior secured creditors to realize 0% to 10% recovery." FONTAINEBLEAU LAS: Moody's Downgrades Default Rating to 'D' ----------------------------------------------------------- Moody's Investors Service downgraded Fontainebleau Las Vegas Holdings, LLC's probability of default rating to D, prompted by the company's voluntary filing of Chapter 11 on June 9, 2009. Moody's downgraded FLVH's Corporate Family rating to Ca and its second mortgage notes to C. Moody's also downgraded Fontainebleau Las Vegas LLC's (a subsidiary of FLVH) first lien bank loan ratings to Caa3. As a result of the bankruptcy filing, Moody's will withdraw all the ratings on FLVH and FLV in approximately three business days. Ratings downgraded: Fontainebleau Las Vegas Holdings, LLC -- Corporate Family rating to Ca from Caa3 -- Probability of Default rating to D from Caa3 -- Second mortgage notes to C (LGD 5, 89%) from Ca (LGD 5, 89%) -- Outlook: Negative Fontainebleau Las Vegas LLC (co-issuer: Fontainebleau Las Vegas II, LLC) -- Senior secured and guaranteed revolving credit facility to Caa3 (LGD 3, 36%) from Caa2 (LGD 3, 36%) -- Senior secured ang guaranteed term loan to Caa3 (LGD3, 36%) from Caa2 (LGD 3, 36%) -- Senior secured and guaranteed delayed draw term loan to Caa3 (LGD 3, 36%) from Caa2 (LGD 3, 36%) -- Outlook: Negative Moody's latest rating action on Fontainebleau was on March 4, 2009, when Fontainebleau Las Vegas Holdings, LLC's Corporate Family rating and Probability of Default rating was downgraded to Caa3 from Caa1. Moody's also downgraded FLVH's second mortgage notes to Ca from Caa3, and Fontainebleau Las Vegas, LLC's first lien bank facilities to Caa2 from B3. Fontainebleau Las Vegas Holdings, LLC, and its direct wholly owned subsidiary, Fontainebleau Las Vegas, LLC, is constructing a luxury resort, Fontainebleau Las Vegas, on the northern end of the Las Vegas Strip. FONTAINEBLEAU LAS VEGAS: Seeks Expedited Resolution of Lawsuit -------------------------------------------------------------- Fontainebleau Las Vegas, LLC, filed a motion for partial summary judgment on its lawsuit against its defaulting revolver lenders that asked a Miami bankruptcy judge for an expedited hearing to determine that those lenders breached their commitment to lend $656 million to the project. Fontainebleau Las Vegas is asking that those funds be turned over immediately to Fontainebleau Las Vegas. Fontainebleau Las Vegas has asked the Honorable Judge Jay Cristol, who is presiding over the Chapter 11 proceedings, to order the revolving banks against which Fontainebleau Las Vegas has brought suit to fund $656 million they had refused to fund on March 3, 2009. That failure ultimately led to the decision by Fontainebleau Las Vegas to seek Chapter 11 bankruptcy protection on June 9, 2009. Lawyers for Fontainebleau Las Vegas said a quick decision to force the banks to fund the revolving credit facility will greatly increase the likelihood of allowing construction to resume promptly on the 63-story casino resort. It will restore thousands of construction jobs, and eventually create more than 8,000 permanent jobs for the Las Vegas economy. "Prompt adjudication of this motion will assist in the ultimate disposition of this case by establishing the Revolver Banks' breach and Plaintiff's right to hundreds of millions of dollars in additional cash collateral," Fontainebleau Las Vegas lawyers wrote in their motion. "Indeed, a favorable resolution of this litigation is the only means by which to obtain funding to complete construction of the project." Fontainebleau Las Vegas alleges that the revolver banks "seized upon a deliberate misreading of the credit agreement to evade their obligations." The lenders claimed that a March 2 notice of borrowing for $656 million did not comply with the credit agreement because a term-loan facility had not been fully funded. But Fontainebleau Las Vegas alleges that the plain terms of the credit agreement required that the term loan be "fully drawn," which the March 2 notice of borrowing accomplished. "This lawsuit is an important and valuable asset of Fontainebleau Las Vegas' bankruptcy estate and its resolution is essential to a resumption of construction and a successful reorganization," said David Friedman, an attorney for Fontainebleau Las Vegas with the New York firm of Kasowitz, Benson, Torres & Friedman LLP. The revolver lenders are led by Bank of America and include: JP Morgan Chase, Barclays Bank, Deutsche Bank Trust Company Americas, The Royal Bank of Scotland, Sumitomo Mitsui Banking Corp., Bank of Scotland, HSH Nordbank and MB Financial Bank. Fontainebleau Las Vegas is asking the bankruptcy court to set hearings on the matter at the court's earliest convenience. About Fontainebleau Las Vegas Fontainebleau Las Vegas Holdings, LLC -- http://www.fontainebleau.com/-- is constructing a luxury resort, Fontainebleu Las Vegas, on the northern end of the Las Vegas Strip. Fontainebleau Las Vegas Holdings, LLC, Fontainebleau Las Vegas, LLC, Fontainebleau Las Vegas Capital Corp. filed for Chapter 11 protection on June 9, 2009 (Bankr. S.D. Fla. Lead Case No. 09-21481). Judge A. Jay Cristol presides over the Debtors' cases. Scott L Baena, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, represents the Debtors in their restructuring efforts. The Debtors' Financial Advisor are Moelis & Company LLC and Citadel Derivatives Group LLC. The Debtors' Special Litigation Counsel is David M. Friedman, Esq., at Kasowitz, Benson, Torres & Friedman LLP and the Debtors' Special Counsel is Jack J. Kessler, Esq., and Alan Rubin, Esq., at Buchanan Ingersoll & Rooney PC. The Debtors' Claims Agent is Kurtzman Carson Consulting LLC. In its petition, Fontainebleau Las Vegas, LLC, disclosed total assets and debts of more than $1 billion. Fontainebleau Las Vegas Capital Corp. and Fontainebleau Las Vegas Holdings, LLC, said their total assets are less than $50,000 while total debts are more than $1 billion. Bankruptcy Creditors' Service, Inc., publishes Fontainebleau Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Fontainebleau Las Vegas Holdings, LLC, and its debtor- affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) FREEDOM COMMUNICATIONS: S&P Withdraws 'CCC-' Corp. Credit Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings on Irvine, California-based diversified media company Freedom Communications Inc. at the company's request. Ratings List Withdrawn Freedom Communications Inc. To From -- ---- Corporate Credit Rating NR CCC-/Negative/-- Secured NR CC Recovery Rating NR 5 NR -- Not rated. FREESCALE SEMICONDUCTOR: Likely to Pay Interest by December 2011 ---------------------------------------------------------------- Freescale Semiconductor Inc. said it may, at its option, elect for any interest payment period prior to December 15, 2011, to use the payment-in-kind feature of its outstanding 9 1/8% and 9 7/8% Senior PIK-Election Notes due 2014 in lieu of making cash interest payments. The company has elected to pay PIK Interest for the interest period ending on December 15, 2009, as a prudent method to enhance liquidity in light of the current global macroeconomic weakness. In connection with this election, on June 9, 2009, the company delivered notice to The Bank of New York Mellon formerly The Bank of New York, in its capacity as trustee under the Indenture governing the PIK-Election Notes, that with respect to the interest that will be due on the Notes on the December 15, 2009 interest payment date, the Company will make the interest payment by paying in kind at the PIK interest rate of 9 7/8% instead of paying interest in cash. About Freescale Semiconductor Freescale Semiconductor -- http://www.freescale.com/-- is a global leader in the design and manufacture of embedded semiconductors for the automotive, consumer, industrial, networking and wireless markets. The privately held company is based in Austin, Texas, and has design, research and development, manufacturing or sales operations around the world. As reported by the Troubled Company Reporter on February 23, Moody's Investors Service affirmed the corporate family, long-term debt and speculative grade liquidity ratings of Freescale. Simultaneously, Moody's downgraded the probability of default rating to Ca from Caa1. The rating outlook remains negative. The downgrade of the PDR to Ca reflects Moody's view that Freescale's recent debt exchange offer is a distressed exchange. It also reflects the very high likelihood of the transaction closing. While no payment default has occurred and there are no debt maturities until 2012, in Moody's opinion the successful closing of the transaction, which is designed to reduce debt and interest expense, would represent the occurrence of a deemed default. The Troubled Company Reporter on April 1, 2009 reported that Standard & Poor's Ratings Services raised its corporate credit rating on Austin, Texas-based Freescale Semiconductor Inc. to 'B-' from 'SD'. The rating outlook is negative. At the same time, S&P raised its senior unsecured and subordinated debt ratings to 'CCC' from 'D' GENERAL GROWTH: Names William Ackman as Director ------------------------------------------------- General Growth Properties Inc appointed William A. Ackman to its Board of Directors. Mr. Ackman brings more than 16 years of investment fund manager and advisor experience to the company. Mr. Ackman is the founder and managing member of the general partner of Pershing Square Capital Management, L.P., an investment advisor founded in 2003. He is a member of the Board of Dean's Advisors of Harvard Business School and a Trustee of the Pershing Square Foundation. Pershing Square Capital Management and its affiliates own slightly less than 7.5% of the company's outstanding common stock. "Bill brings an important perspective and creative thinking to our Board at this critical time in the Company's development of a sustainable long-term capital structure and we look forward to his future contributions to the Company," said Adam Metz, chief executive officer of General Growth Properties. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. (NYSE:GGP) -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D. N.Y., Case No. 09- 11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of December 31, 2008. GENERAL GROWTH: 22 Units Now Face Ch. 11 Case Dismissal Requests ---------------------------------------------------------------- As previously reported by the Troubled Company Reporter, ING Clarion Capital Loan Services LLC asked Judge Allan Gropper of the U.S. Bankruptcy Court for the Southern District of New York to dismiss the Chapter 11 cases of nine of General Growth Properties, Inc.'s debtor-affiliates: (1) Bakersfield Mall LLC (2) RASCAP Realty, Ltd. (3) Visalia Mall, L.P. (4) GGP-Tucson Mall L.L.C. (5) Lancaster Trust (6) HO Retail Properties II Limited Partnership (7) RS Properties Inc. (8) Stonestown Shopping Center L.P. (9) Fashion Place, LLC Wells Fargo Bank, N.A., as trustees, also asked the Court to dismiss the Chapter 11 cases of: (1) Faneuil Hall Marketplace LLC (2) Saint Louis Galleria L.L.C. Metropolitan Life Insurance Company has followed suit and is asking the Court to dismiss each of these Debtors' Chapter 11 cases: (1) Providence Place Holdings LLC (2) Rouse Providence LLC (3) White Marsh Mall LLC (4) White Marsh Mall Associates (5) White Marsh Mall Phase II Associates (6) White Marsh General Partnership (7) Howard Hughes Properties, Limited Partnership (8) 10000 West Charleston Boulevard LLC (9) 9901-9921 Covington Cross, LLC (10) 1120/1140 Town Center Drive, LLC FRM Funding Company, Inc., likewise, asks the Court to dismiss the Chapter 11 case of Debtor Fox River Center, LLC. Metropolitan Life relates that the Debtors are parties to one or more of these prepetition loans: Loan Debtor Loan Amount Maturity ---- ------ ----------- -------- Mezzanine Providence Place $104,320,207 03/11/11 Senior Loan Rouse Providence $273,000,000 03/11/11 White Marsh Mall White Marsh $187,000,000 09/04/11 Entities Hughes-Summerlin Howard Hughes $24,000,000 03/01/11 Properties Properties and 10000 West Charleston On behalf of Metropolitan Life, Bruce R. Zirinsky, Esq., at Greenberg Traurig LLP, in New York, asserts that the Debtors' Chapter 11 cases should be dismissed because they were not filed in good faith. At the time the Debtors' Chapter 11 cases were filed, the Debtors were current on all of their obligations and were not experiencing any immediate or imminent financial problems, Mr. Zirinsky points out. Thus, there was no present need for the Debtors to file for relief under Chapter 11, he argues. Moreover, Mr. Zirinsky contends that the Debtors' Chapter 11 cases should be dismissed because, other than Metropolitan Life, it is highly unlikely that there are any other significant creditors. He asserts that since any plan would have to pay any creditors in full so as to leave them unimpaired, the Debtors will not be able to cramdown a plan over Metropolitan Life's objections. KBC Bank N.V. joins in Metropolitan Life's motion to dismiss the White Marsh Debtors' Chapter 11 cases. FRM Funding is successor-in-interest to U.S. Bank National Association under a $195,000,000 loan agreement with Fox River on December 15, 2007. Based on its unaudited financial statements, Fox River has $27 million as revenues in 2008 and net operating income exceeding $20 million. Moreover, the Loan Agreement will not mature until December 2012. FMR Funding alleges that Fox River's Chapter 11 case should be dismissed because (a) on the Petition Date, Fox River's corporate resolutions to commence the Chapter 11 case were ineffective under state law; (b) the relief Fox River has sought in the Chapter 11 case violates its organizational documents; and (c) Fox River filed the Chapter 11 case in bad faith. FRM Funding's counsel, Janet M. Weiss, Esq., at Gibson, Dunn & Crutcher LLP, in New York, explains that Fox River's operating agreement entered among GGP Limited Partnership, Beth L. Peoples, and Suzanne M. Hay, Fox River's independent managers, requires that the unanimous prior written consent of all managers, including the Independent Managers, must be obtained to file for bankruptcy petition. However, on the Petition Date, Ms. Peoples and Ms. Hay did not authorize the commencement of Fox River's Chapter 11 case, Ms. Weiss tells the Court. Fox River did not have authority to file a bankruptcy petition because it failed to comply with its own governance requirements, Ms. Weiss points out. Since the Debtors knowingly filed the Chapter 11 case in violation of Fox Rivers' organization documents, it was filed in bad faith, Ms. Weiss argues. Petitions Were Filed in Good Faith, Debtors Insist On behalf of the Debtors, James H. M. Sprayregen, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, explains that in filing for bankruptcy protection and commencing restructuring, the project subsidiaries or the Project Debtors seek to maximize each entity's enterprise value for the benefit of all constituent stakeholders. Although operationally sound with strong cash flows, the Project Debtors realized that they had no realistic prospects of securing financing for hundreds of millions of dollars of defaulted and maturing loans, given the collapse of the commercial real estate credit markets, Mr. Sprayregen tells Judge Gropper. Thus, after weeks of deliberation, the Project Debtors made the only reasonable business judgment -- that is to file for Chapter 11 protection -- to address the credit crisis on a comprehensive basis rather than waiting to make serial bankruptcy filings as each loan matured. These decisions to pursue reorganization were made only after General Growth Properties, Inc.'s efforts to refinance billions of dollars of maturing secured and unsecured debts on its own behalf and on behalf of its project-level subsidiaries proved unsuccessful, he discloses. Against this backdrop, the claims of "bad faith" filing are meritless, Mr. Sprayregen argues. Mr. Sprayregen, citing In re Cohoes Indus. Terminal, Inc., 931 F.2d 222, 227 (2d Cir. 1991), points out that a bankruptcy petition should not be dismissed unless "it is clear that on the filing date there was no reasonable likelihood that the debtor intended to reorganize and no reasonable probability that it would eventually emerge from bankruptcy proceedings." Mr. Sprayregen notes that the (i) the assets of the Project Debtors are not the subject of foreclosure actions; (ii) the Debtors have positive cash flow; and (iii) the Project Debtors are meeting their current expenses including the payment of taxes. He emphasizes that the Project Debtors' bankruptcy was not filed as a tactical step in connection with litigation as there is no ongoing litigation among ING Clarion, Wells Fargo and the Project Debtors, but was filed because of the shutdown of the credit markets and the inability of the Debtors to refinance their mortgages and other debt. Mr. Sprayregen explains that a debtor needs only "face a financial difficulty that, if it did not file at that time, it could anticipate the need to file in the future." Given the condition of the credit markets, the Project Debtors made the decision that filing for bankruptcy now would maximize stakeholder value for each Project Debtor because waiting for a series of anticipated defaults would benefit no one, he stresses. Further citing In re Cohoes, 931 F.2d at 228, he points out that, as a matter of law, a debtor need not be in extremis in order to file a bankruptcy petition. Thus, the Debtors ask the Court to deny the Motions to Dismiss filed by ING Clarion and Wells Fargo. The Debtors have not yet responded to the motions filed by Metropolitan Life and FRM Funding. Committee Supports Debtors The Official Committee of Unsecured Creditors argues that regardless of whether the Project Debtors were capable of making the interest payments due on their loans at the time of filing, the Project Debtors were still faced with (i) a substantial likelihood that they would be unable to satisfy the more than $2 billion of principal payments soon to be due, and (ii) the insolvency of their Debtor-Parents whom they relied upon to run the daily and long-term operations of their businesses. As the businesses are completely integrated and inseparable, ensuring the continued viability of the Project Debtors requires the protections of Chapter 11, the Committee notes. The Committee thus proposes that the Court consider the Project Debtors' Chapter 11 filings in light of the circumstances of the Debtors. Accordingly, the Committee asks the Court to deny ING Clarion's and Wells Fargo's Motions to Dismiss. Judge Gropper has adjourned to June 17, 2009, the hearing on ING Clarion's request. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. (NYSE:GGP) -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D. N.Y., Case No. 09- 11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of Dec. 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL GROWTH: Goldman Sachs & Brookfield Want $5.7MM Award ------------------------------------------------------------ Pursuant to Sections 503(b)(3)(d) of and 503(b)(4) of the Bankruptcy Code, Goldman Sachs Mortgage Company and Brookfield Financial, LLC, as proposed lenders and co-arrangers of the debtor-in-possession financing to General Growth Properties Inc. and its debtor affiliates, jointly ask the U.S. Bankruptcy Court for the Southern District of New York to allow their $5,779,030 administrative expense claims against the Debtors. The administrative expense claims are divided into: -- $2,894,162 payable to Goldman Sachs and $1,184,868 to Brookfield Financial immediately after entry of an order approving their request; and -- $1,275,000 payable to Goldman Sachs and $425,000 to Brookfield Financial immediately after consummation of a plan of reorganization for the Debtors. Deborah M. Buell, Esq., at Wilkie Farr and Gallagher LLP, in New York, relates that the Joint Bidders made a substantial contribution to the competitive bidding of the Debtors' DIP financing by offering these terms, including: -- no grant of warrants to the DIP lenders, saving the Debtors hundreds of million dollars; -- provision of a lower interest rate; a $100 million delayed draw feature that gave the Debtors flexibility on the timing and cost of their draws on the facility for up to nine months, saving the Debtors $10 million; and a lower commitment fee than that paid to group led by Pershing Square Capital Management, LP; and -- extension of the term of the financing by six months, to a total of 24 months, rather than the Pershing Group's 18 months, thereby providing greater flexibility. Ms. Buell argues that by offering cost-reducing terms and structural enhancements, the Joint Bidders enabled the Debtors to demand and secure financing from the group led by Farallon Capital Management, LLC, on far more favorable terms than under the original package. She points out the Joint Bidders' proposal also offered the prepetition secured creditors a pari passu first lien on the main cash operating account, rather than the lien the Farallon Group proposed that was subject to prior repayment of the DIP Financing. Those structural provisions were highly valuable to the Debtors' estates and the creditors as they potentially saved the Debtors' estates millions in legal fees and costs by mooting multiple creditor objections that would have required extensive litigation, she asserts. Ms. Buell stresses that whether measured qualitatively or quantitatively, the value the Joint Bidders contributed to the bidding for the DIP Financing and the benefits they provided to the Debtors, the creditors, and their estates, are the very essence of a "substantial contribution" under Section 503(b)(3)(D) of the Bankruptcy Code. Indeed, the Committee, which encouraged the Joint Bidders to bid and acknowledged the substantial contribution they made in the Debtors' Chapter 11 cases, will file a statement in support of the award the Joint Bidders ask in their Motion to Allow, she adds. Moreover, Ms. Buell discloses that the fees and expenses sought to be approved are rendered by Cleary Gottlieb Steen & Hamilton LLP, as counsel to Goldman Sachs and Willkie Farr & Gallagher LLP as counsel to Brookfield Financial. She assures the Court that the Counsel's fees and expenses are reasonable in light of the substantial contribution they made in the Debtors' Chapter 11 cases in connection with the Debtors' successful procurement of postpetition financing on favorable terms. Accordingly, the Joint Bidders are entitled to allowance and payment of an administrative claim in the aggregate amount of the fees and expenses, she maintains. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. (NYSE:GGP) -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D. N.Y., Case No. 09- 11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of Dec. 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL GROWTH: Wants Schedules Filing Deadline Moved to July 31 ---------------------------------------------------------------- General Growth Properties Inc. and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to further extend the time in which they must file their schedules of assets and liabilities and statements of financial affairs through and including July 31, 2009. The Debtors, according to their counsel, Gary T. Holtzer, Esq., at Weil, Gotshal & Manges LLP, in New York, have been diligently working to complete their Schedules and have made significant progress. The Debtors, however, were not able to complete their Schedules by the deadline on June 1, 2009. For one, Mr. Holtzer explains the Debtors' completion of the Schedules has been impacted by the volume of information that the Debtors are required to disclose. He adds that to prepare their Schedules, the Debtors must compile information from books, records, and documents relating to myriad claims, assets, and contracts for 388 Debtors. The Debtors must also locate and confirm information and documents located across the Debtors' portfolio of properties throughout the United States. He stresses that despite their best efforts, marshalling the information needed to complete the Schedules has placed heavy demands on the Debtors' personnel, professionals, and resources. Moreover, the Debtors' ordinary course accounting procedures require at least 30-45 days after each month to reconcile and close their books with respect to that month. As a result, the Debtors will not have reconciled their books and records for April 2009, the month the Debtors commenced their Chapter 11 cases, until the middle of June 2009. Against this backdrop, the Debtors require a 60-day extension of through and including July 31 to finalize their Schedules, Mr. Holtzer asserts. He stresses that the proposed extension is warranted and does not prejudice any party-in-interest. He adds that the Debtors have consulted with the U.S. Trustee for Region 2, who has consented to the proposed extension. The Court will hear the Debtors' request on June 24, 2009. Objections are due June 19. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. (NYSE:GGP) -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D. N.Y., Case No. 09- 11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of Dec. 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL GROWTH: A&K Endowment Appeals Final DIP Financing Order --------------------------------------------------------------- A&K Endowment, Inc., took an appeal to the U.S. District Court for the Southern District of New York from Judge Allan Gropper's order authorizing General Growth Properties Inc. and its debtor- affiliates to access the $400,000,000 debtor-in-possession loans from a group of the Debtors' bondholders led by Open Air Investors, L.L.C., which is backed by Farallon Capital Management, L.L.C. The order was entered on a final basis on May 14, 2009. Through the appeal, A&K Endowment wants the District Court to review whether the Bankruptcy Court erred in: (1) allowing the Debtors to encumber the previously unencumbered real property located in Nevada, commonly known as Summerlin Property, to provide financing to certain other Debtors, some of which may be insolvent and whose cases have not been substantively consolidated with that of Howard Hughes Properties, Inc. and The Howard Hughes Corporation, the solvent Debtors that own the Summerlin Property; (2) allowing the Debtors to encumber the Summerlin Property to obtain DIP Financing for the Other Debtors for not more than $400 million, where the financing was used, in part, to satisfy the Prepetition Goldman Facility for $225 million, and no direct benefit was received from either the Summerlin Debtors or the Summerlin Property; (3) authorizing a lien against the Summerlin Property without any evidence that the financing approved, and to be approved, pursuant to the Final DIP Order will provide a benefit to the (i) Summerlin Debtors and (ii) Summerlin Property; (4) authorizing a lien against the Summerlin Property in breach of the contractual obligations of The Rouse Company L.P. and General Growth Properties, Inc. to A&K and the other holders under a Contingent Stock Agreement; and (5) authorizing a lien against the Summerlin Property in breach of the fiduciary obligations of The Rouse Company L.P. and General Growth to A&K and the other holders of the CSA. Under the DIP Financing, UBS Securities LLC serves as the lead arranger and UBS AG serves as the administrative agent for the DIP Lenders. These bondholders commit to extend these amounts to the Debtors: Open Air Investors, L.L.C. $210,000,000 Luxor Capital LLC $110,000,000 Canpartners Investments IV, LLC $25,000,000 Perry Principals Investments LLC $25,000,000 Whitebox Combined Partners LP $11,000,000 Whitebox Hedged High Yield Partners LP $6,000,000 Whitebox Convertible Arbitrage Partners LP $5,000,000 Pandora Select Partners LP $2,000,000 Whitebox Special Opportunities Fund Series B Partners LP $1,000,000 Delaware Street Capital Master Fund, L.P. $5,000,000 The DIP Loan will mature on the earliest of two years after the DIP Agreement is signed by all Lenders, the effective date of any plan of reorganization filed by the Debtors, or (c) the date the Term Loan is accelerated pursuant to the terms of the DIP Loan, whether at stated maturity, upon an Event of Default or otherwise. A full-text copy of the Final DIP Order is available for free at: http://bankrupt.com/misc/GenGrowth_FinalDIPOrder.pdf About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. (NYSE:GGP) -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D. N.Y., Case No. 09- 11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of Dec. 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Bondholders to Challenge Sale to New GM ------------------------------------------------------- Bankruptcy Law360 reports that Michael Richman at Patton Boggs LLP, who represents an unofficial three-person committee of General Motors Corp. bondholders, said that his clients will challenge the Company's sale to spinoff company New GM. Bankruptcy Law360 relates that the creditors -- Harold A. John, Mark Modica, and Wade McGee -- hold $2.3 million in GM bonds and are also seeking the appointment of an official committee of non- institutional bondholders. Mr. Richman said that the creditors will block the sale if they are recognized as an official bankruptcy committee, Linda Sandler, Christopher Scinta, and Tiffany Kary at Bloomberg News state. Citing Mr. Richman, Bloomberg says that the bondholders want to represent about 1,500 investors holding an estimated $400 million in bonds as an official committee. According to Bloomberg, GM creditors have until June 19 to oppose a plan to create a streamlined company with trimmed debt and wage costs. Bloomberg quoted Mr. Richman as saying that GM's spinoff proposal "appears to us to be designed as a sale in order to evade the plan confirmation requirements of the bankruptcy code." Bloomberg relates that the GM challenger group, which excludes institutional bondholders, would get funding from the Company's bankrupt estate if the court recognizes them as an official committee. Bondholders Want Thomas Lauria as Counsel Jeffrey McCracken and Neil King Jr. at The Wall Street Journal report that some GM bondholders have asked Thomas Lauria at White & Case, who won a stay from Supreme Court Justice Ruth Bader Ginsburg on Monday that temporarily threw Chrysler LLC's proposed alliance with Fiat SpA into limbo, to represent them in GM's bankruptcy case. WSJ relates that Mr. Lauria hasn't decided on the matter. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of $6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of $3.3 billion in the year-ago quarter. As of March 31, 2009, GM had $82.2 billion in total assets and $172.8 billion in total liabilities, resulting in $90.5 billion in stockholders' deficit. On April 27, General Motors presented the U.S. Department of Treasury with an updated plan as required by the loan agreement signed by GM and the U.S. Treasury on December 31, 2008. The plan addresses the key restructuring targets required by the loan agreement, including a number of the critical elements of the plan that was submitted to the U.S. government on December 2, 2008. Among these are: U.S. market competitiveness; fuel economy and emissions; competitive labor cost; and restructuring of the company's unsecured debt. It also includes a timeline for repayment of the Federal loans, and an analysis of the Company's positive net present value. The plan details the future reduction of GM's vehicle brands and nameplates in the U.S., further consolidation in its workforce and dealer network, accelerated capacity actions and enhanced manufacturing competitiveness, while maintaining GM's strong commitment to high-quality, fuel-efficient vehicles and advanced propulsion technologies. A full-text copy of GM's viability plan presented in February 2009 is available at http://researcharchives.com/t/s?39a4 General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D. N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsels. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 restructuring proceedings commenced by General Motors Corporation and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: NYSE Files Notice of Removal With SEC ----------------------------------------------------- New York Stock Exchange Inc. filed a Form 25 notifying the U.S. Securities and Exchange Commission of the removal from listing or registration under Section 12(b) of the Securities and Exchange Act of 1934 of General Motors Corp.'s 1.50% Series D Convertible Senior Debentures due June 1, 2009. NYSE filed the Notice of Removal on June 9, 2009. Paras Madho, director of the NYSE, discloses that NYSE has complied with its rule to strike GM's 1.50% Senior Debentures from listing or registration on the NYSE. NYSE informed GM on June 3, 2009 that it is no longer suitable for listing on the NYSE and that all securities of GM, including its common stock will be delisted. Two GM Officers Disclose Disposal of Shares Borst Walter Gerhardt, treasurer of General Motors Corp. disclosed with the SEC on June 5, 2009, that he disposed of 8,692 shares of the company's $1-2/3 Par Value Common Stock at $0.83 per share. In the same filing, Mr. Gerhardt also reported that he accrued 35 shares of GM Stock $1-2/3 Par Value Deferred Stock Units under the qualified General Motors Deferred Compensation Plan. Each Deferred Stock Unit is the economic equivalent of one share of General Motors common stock. If General Motors pays a dividend, dividend equivalents are earned on each Deferred Stock Unit. The Deferred Stock Unit convert on a "1 for 1" basis. Mr. Gerhardt also disclosed that he exercised his employee stock options or the right to buy shares of General Motors Corp. Common Stock pursuant to Rule 16b-3 qualified Long-Term Incentive Plan. These stock options vest and become exercisable in three equal annual installments, commencing one to three years from the date of initial grant. The first installment became exercisable on January 10, 2001: Securities Beneficially Exercise No. of Expiration Owned After Date Shares Price Date Transaction -------- ----- ----- ---------- ----------- 01/10/2001 6,500 $75.50 01/11/2010 6,500 01/08/2002 8,200 52.35 01/09/2011 8,200 01/07/2003 9,000 50.46 01/08/2012 9,000 02/04/2003 4,500 50.82 02/05/2012 4,500 01/21/2004 9,000 40.05 01/22/2013 9,000 04/07/2004 5,000 35.76 04/08/2013 5,000 01/23/2005 12,800 53.92 01/24/2014 12,800 01/24/2006 12,800 36.37 01/25/2015 12,800 02/23/2007 10,000 20.90 02/24/2016 12,800 03/20/2008 12,000 29.11 03/21/2017 12,000 03/05/2009 19,500 23.13 03/06/2018 19,500 Mr. Gerhardt further disclosed that (iii) he exercised Restricted Stock Units granted pursuant to Rule 16b-3 qualified General Motors Cash Based Restricted Stock Unit Plan. Each Restricted Stock Unit is the economic equivalent of one share of GM Common Stock. If GM pays a dividend, dividend equivalents are earned on each undelivered Restricted Stock Unit. The RSUs are denominated in stock units but are paid in cash in three annual installments commencing one, two and three years from the date of the initial grant. The first installment is due on March 20, 2008: No. of Shares Exercise Date No. of Shares After Transaction ------------- ------------- ----------------- 03/20/2008 2,809 2,809 03/05/2009 7,972 7,972 Ray G. Young, executive vice president and chief financial officer of General Motors Corp., disclosed with the SEC on June 3, 2009, that he disposed of 11,579 shares of the company's $1-2/3 Par Value Common Stock at $0.55 per share. Mr. Young also reported that he derived stock options or the right to buy shares of General Motors Corp. Common Stock pursuant to Rule 16b-3 qualified Long-Term Incentive Plan. This stock option vest and become exercisable in three equal installments, commencing from one to three years from the date of initial grant. The first installment became exercisable on January 10, 2001: Securities Beneficially Exercise No. of Expiration Owned After Date Shares Price Date Transaction -------- ----- ----- ----------- ----------- 01/10/2001 6,000 $75.50 01/22/2010 6,000 01/08/2002 7,500 52.35 01/09/2011 7,500 01/07/2003 14,000 50.46 01/08/2012 14,000 02/04/2003 7,000 50.82 02/05/2012 7,000 01/21/2004 16,000 40.05 01/22/2013 16,000 01/23/2005 12,800 53.92 01/24/2014 12,800 01/24/2006 12,800 36.37 01/25/2015 12,800 02/23/2007 10,000 20.90 02/24/2016 10,000 03/20/2008 15,000 29.11 03/21/2017 15,000 03/05/2009 87,500 23.13 03/06/2018 87,500 Mr. Young also reported that he exercised Restricted Stock Units granted pursuant to Rule 16b-3 qualified General Motors Cash Based Restricted Stock Unit Plan. Each Restricted Stock Unit is the economic equivalent of one share of General Motors Common Stock. If GM pays a dividend, dividend equivalents are earned on each undelivered Restricted Stock Unit. The RSUs are denominated in stock units but are paid in cash in three annual installments commencing one, two and three years from the date of the initial grant. The first installment was payable on March 20, 2008. No. of shares Exercise Date No. of shares after transaction ------------- ------------- ----------------- 03/20/2008 3,651 3,651 03/05/2009 20,236 20,236 About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of $6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of $3.3 billion in the year-ago quarter. As of March 31, 2009, GM had $82.2 billion in total assets and $172.8 billion in total liabilities, resulting in $90.5 billion in stockholders' deficit. On April 27, General Motors presented the U.S. Department of Treasury with an updated plan as required by the loan agreement signed by GM and the U.S. Treasury on December 31, 2008. The plan addresses the key restructuring targets required by the loan agreement, including a number of the critical elements of the plan that was submitted to the U.S. government on December 2, 2008. Among these are: U.S. market competitiveness; fuel economy and emissions; competitive labor cost; and restructuring of the company's unsecured debt. It also includes a timeline for repayment of the Federal loans, and an analysis of the Company's positive net present value. The plan details the future reduction of GM's vehicle brands and nameplates in the U.S., further consolidation in its workforce and dealer network, accelerated capacity actions and enhanced manufacturing competitiveness, while maintaining GM's strong commitment to high-quality, fuel-efficient vehicles and advanced propulsion technologies. A full-text copy of GM's viability plan presented in February 2009 is available at http://researcharchives.com/t/s?39a4 General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D. N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsels. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 restructuring proceedings commenced by General Motors Corporation and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS ACCEPTANCE: Moody's Raises Sr. Unsec. Rating to Ca ----------------------------------------------------------------- Moody's Investors Service upgraded the senior unsecured rating of GMAC LLC to Ca from C. In addition, Moody's placed GMAC's senior unsecured and preferred stock ratings (currently C) on review for further possible upgrade. The ratings of Residential Capital LLC (senior at C), GMAC's residential mortgage finance subsidiary, were not affected by this action. Moody's said the upgrade of GMAC's rating reflects the firm's lower bankruptcy risk resulting from the U.S. government's support of the firm, including significant capital injections that have improved its liquidity and capital positions, partial U.S. government ownership, and GMAC's role in the U.S. government's efforts to reinvigorate the U.S. domestic auto industry. Of continuing concern, GMAC must yet raise substantial additional equity to comply with the requirements of the recently concluded stress tests under the U.S. government's Supervisory Capital Assessment Program. Though it is possible that GMAC could seek to fill a portion of the additional capital need through a distressed debt exchange, Moody's believes the motivation of bondholders to accept the terms of a distressed exchange are uncertain, given GMAC's lower risk of bankruptcy. Were such an exchange commenced, Moody's also believes that the result for bondholders would be consistent with the newly assigned Ca rating. "Capital inflows, partial government ownership, and GMAC's importance to reviving GM and Chrysler point to a lower probability of near-term default," said Moody's senior analyst Mark Wasden. "However, the challenges GMAC faces in executing its business strategy and the resultant uncertainties for bondholders remain a constraint on GMAC's credit." Government support of GMAC has been multifaceted. In May, GMAC issued $7.5 billion of mandatorily convertible preferred membership interests to the U.S. Treasury, $4 billion of which supports GMAC's agreement with Chrysler LLC to provide financing to Chrysler dealers and customers. GMAC was also approved to participate in the FDIC's Temporary Liquidity Guarantee Program, under which it can issue up to $7.4 billion in FDIC guaranteed debt by October 2009. GMAC issued $4.5 billion of TLGP debt on June 3, which Moody's rated Aaa. The U.S. government's ownership of GMAC is about 35%, which would increase upon conversion of the U.S. Treasury's MCP's. GMAC was also granted additional flexibility to issue GM-related auto finance receivables in GMAC Bank (a/k/a Ally Bank) under an expanded 23A exemption to the Federal Reserve Act. Assets originated in the bank are funded by deposits, which are a lower cost source of funding that GMAC has continued to access throughout the current cycle. Notwithstanding these positive developments, Moody's remains cautious regarding the operating and financial challenges GMAC faces. In particular, it is uncertain how GMAC will raise by November 2009 the $5.6 billion of "new" and $2.4 billion of "other" capital qualifying as Tier 1 common equity that is required by regulators. Moody's believes GMAC's access to private sources of capital to meet these requirements is limited and that the firm will most likely request an additional investment from the U.S. Treasury. GMAC is also contending with asset quality deterioration in its auto finance and residential mortgage operations that could lead to further operating losses during the current downcycle. Moody's rating anticipates that ResCap will continue to require capital support from GMAC as it services a large portfolio of troubled mortgages to liquidation. Additional long-term uncertainties relate to GMAC's eventual ownership structure and liquidity profile, as well as GMAC's relationships with "new" GM and Chrysler and the strength of their future operating prospects. Moody's believes that GMAC must eventually demonstrate capital and funding strategies that don't rely upon continued U.S. government involvement in the firm. During its review of GMAC's ratings, Moody's will seek clarity regarding GMAC's capital raising plans. Should the firm successfully fill the capital requirement while preserving the status and protections of senior creditors, its long-term ratings could be upgraded to the Caa category. GMAC LLC: -- Senior Unsecured: to Ca from C GMAC Australia LLC: -- Backed Senior Unsecured: to Ca from C GMAC Bank GMBH: -- Backed Senior Unsecured: to Ca from C GMAC International Finance B.V.: -- Backed Senior Unsecured: to Ca from C GMAC, Australia (Finance) Limited: -- Backed Senior Unsecured: to Ca from C GMAC (NZ) Limited: -- Backed Senior Unsecured: to Ca from C General Motors Acceptance Corp. of Canada Ltd.: -- Backed Senior Unsecured: to Ca from C Moody's has also assigned a rating of Ca to senior unsecured debt issued to holders that tendered old bonds as a part of GMAC's December 2008 bond exchange. The exchange bonds are guaranteed by certain GMAC subsidiaries. In Moody's view, the additional creditor protections associated with the guarantees is insufficient at this time to warrant a notching differential from GMAC's senior unsecured debt that does not benefit from these guarantees. In its last rating action on November 20, 2008, Moody's downgraded GMAC's rating to C from Caa1, following GMAC's launch of a debt exchange offering that Moody's viewed as a distressed exchange. GMAC LLC is a global financial services company operating in the automotive finance, dealer and personal line insurance, and residential real estate finance sectors. GMAC BANK: Moody's Raises Backed Sr. Unsecured Rating to Ca ----------------------------------------------------------- Moody's Investors Service upgraded the senior unsecured rating of GMAC LLC to Ca from C. In addition, Moody's placed GMAC's senior unsecured and preferred stock ratings (currently C) on review for further possible upgrade. The ratings of Residential Capital LLC (senior at C), GMAC's residential mortgage finance subsidiary, were not affected by this action. Moody's said the upgrade of GMAC's rating reflects the firm's lower bankruptcy risk resulting from the U.S. government's support of the firm, including significant capital injections that have improved its liquidity and capital positions, partial U.S. government ownership, and GMAC's role in the U.S. government's efforts to reinvigorate the U.S. domestic auto industry. Of continuing concern, GMAC must yet raise substantial additional equity to comply with the requirements of the recently concluded stress tests under the U.S. government's Supervisory Capital Assessment Program. Though it is possible that GMAC could seek to fill a portion of the additional capital need through a distressed debt exchange, Moody's believes the motivation of bondholders to accept the terms of a distressed exchange are uncertain, given GMAC's lower risk of bankruptcy. Were such an exchange commenced, Moody's also believes that the result for bondholders would be consistent with the newly assigned Ca rating. "Capital inflows, partial government ownership, and GMAC's importance to reviving GM and Chrysler point to a lower probability of near-term default," said Moody's senior analyst Mark Wasden. "However, the challenges GMAC faces in executing its business strategy and the resultant uncertainties for bondholders remain a constraint on GMAC's credit." Government support of GMAC has been multifaceted. In May, GMAC issued $7.5 billion of mandatorily convertible preferred membership interests to the U.S. Treasury, $4 billion of which supports GMAC's agreement with Chrysler LLC to provide financing to Chrysler dealers and customers. GMAC was also approved to participate in the FDIC's Temporary Liquidity Guarantee Program, under which it can issue up to $7.4 billion in FDIC guaranteed debt by October 2009. GMAC issued $4.5 billion of TLGP debt on June 3, which Moody's rated Aaa. The U.S. government's ownership of GMAC is about 35%, which would increase upon conversion of the U.S. Treasury's MCP's. GMAC was also granted additional flexibility to issue GM-related auto finance receivables in GMAC Bank (a/k/a Ally Bank) under an expanded 23A exemption to the Federal Reserve Act. Assets originated in the bank are funded by deposits, which are a lower cost source of funding that GMAC has continued to access throughout the current cycle. Notwithstanding these positive developments, Moody's remains cautious regarding the operating and financial challenges GMAC faces. In particular, it is uncertain how GMAC will raise by November 2009 the $5.6 billion of "new" and $2.4 billion of "other" capital qualifying as Tier 1 common equity that is required by regulators. Moody's believes GMAC's access to private sources of capital to meet these requirements is limited and that the firm will most likely request an additional investment from the U.S. Treasury. GMAC is also contending with asset quality deterioration in its auto finance and residential mortgage operations that could lead to further operating losses during the current downcycle. Moody's rating anticipates that ResCap will continue to require capital support from GMAC as it services a large portfolio of troubled mortgages to liquidation. Additional long-term uncertainties relate to GMAC's eventual ownership structure and liquidity profile, as well as GMAC's relationships with "new" GM and Chrysler and the strength of their future operating prospects. Moody's believes that GMAC must eventually demonstrate capital and funding strategies that don't rely upon continued U.S. government involvement in the firm. During its review of GMAC's ratings, Moody's will seek clarity regarding GMAC's capital raising plans. Should the firm successfully fill the capital requirement while preserving the status and protections of senior creditors, its long-term ratings could be upgraded to the Caa category. GMAC LLC: -- Senior Unsecured: to Ca from C GMAC Australia LLC: -- Backed Senior Unsecured: to Ca from C GMAC Bank GMBH: -- Backed Senior Unsecured: to Ca from C GMAC International Finance B.V.: -- Backed Senior Unsecured: to Ca from C GMAC, Australia (Finance) Limited: -- Backed Senior Unsecured: to Ca from C GMAC (NZ) Limited: -- Backed Senior Unsecured: to Ca from C General Motors Acceptance Corp. of Canada Ltd.: -- Backed Senior Unsecured: to Ca from C Moody's has also assigned a rating of Ca to senior unsecured debt issued to holders that tendered old bonds as a part of GMAC's December 2008 bond exchange. The exchange bonds are guaranteed by certain GMAC subsidiaries. In Moody's view, the additional creditor protections associated with the guarantees is insufficient at this time to warrant a notching differential from GMAC's senior unsecured debt that does not benefit from these guarantees. In its last rating action on November 20, 2008, Moody's downgraded GMAC's rating to C from Caa1, following GMAC's launch of a debt exchange offering that Moody's viewed as a distressed exchange. GMAC LLC is a global financial services company operating in the automotive finance, dealer and personal line insurance, and residential real estate finance sectors. GMAC INTERNATIONAL: Moody's Raises Backed Sr. Unsec. Rating to Ca ----------------------------------------------------------------- Moody's Investors Service upgraded the senior unsecured rating of GMAC LLC to Ca from C. In addition, Moody's placed GMAC's senior unsecured and preferred stock ratings (currently C) on review for further possible upgrade. The ratings of Residential Capital LLC (senior at C), GMAC's residential mortgage finance subsidiary, were not affected by this action. Moody's said the upgrade of GMAC's rating reflects the firm's lower bankruptcy risk resulting from the U.S. government's support of the firm, including significant capital injections that have improved its liquidity and capital positions, partial U.S. government ownership, and GMAC's role in the U.S. government's efforts to reinvigorate the U.S. domestic auto industry. Of continuing concern, GMAC must yet raise substantial additional equity to comply with the requirements of the recently concluded stress tests under the U.S. government's Supervisory Capital Assessment Program. Though it is possible that GMAC could seek to fill a portion of the additional capital need through a distressed debt exchange, Moody's believes the motivation of bondholders to accept the terms of a distressed exchange are uncertain, given GMAC's lower risk of bankruptcy. Were such an exchange commenced, Moody's also believes that the result for bondholders would be consistent with the newly assigned Ca rating. "Capital inflows, partial government ownership, and GMAC's importance to reviving GM and Chrysler point to a lower probability of near-term default," said Moody's senior analyst Mark Wasden. "However, the challenges GMAC faces in executing its business strategy and the resultant uncertainties for bondholders remain a constraint on GMAC's credit." Government support of GMAC has been multifaceted. In May, GMAC issued $7.5 billion of mandatorily convertible preferred membership interests to the U.S. Treasury, $4 billion of which supports GMAC's agreement with Chrysler LLC to provide financing to Chrysler dealers and customers. GMAC was also approved to participate in the FDIC's Temporary Liquidity Guarantee Program, under which it can issue up to $7.4 billion in FDIC guaranteed debt by October 2009. GMAC issued $4.5 billion of TLGP debt on June 3, which Moody's rated Aaa. The U.S. government's ownership of GMAC is about 35%, which would increase upon conversion of the U.S. Treasury's MCP's. GMAC was also granted additional flexibility to issue GM-related auto finance receivables in GMAC Bank (a/k/a Ally Bank) under an expanded 23A exemption to the Federal Reserve Act. Assets originated in the bank are funded by deposits, which are a lower cost source of funding that GMAC has continued to access throughout the current cycle. Notwithstanding these positive developments, Moody's remains cautious regarding the operating and financial challenges GMAC faces. In particular, it is uncertain how GMAC will raise by November 2009 the $5.6 billion of "new" and $2.4 billion of "other" capital qualifying as Tier 1 common equity that is required by regulators. Moody's believes GMAC's access to private sources of capital to meet these requirements is limited and that the firm will most likely request an additional investment from the U.S. Treasury. GMAC is also contending with asset quality deterioration in its auto finance and residential mortgage operations that could lead to further operating losses during the current downcycle. Moody's rating anticipates that ResCap will continue to require capital support from GMAC as it services a large portfolio of troubled mortgages to liquidation. Additional long-term uncertainties relate to GMAC's eventual ownership structure and liquidity profile, as well as GMAC's relationships with "new" GM and Chrysler and the strength of their future operating prospects. Moody's believes that GMAC must eventually demonstrate capital and funding strategies that don't rely upon continued U.S. government involvement in the firm. During its review of GMAC's ratings, Moody's will seek clarity regarding GMAC's capital raising plans. Should the firm successfully fill the capital requirement while preserving the status and protections of senior creditors, its long-term ratings could be upgraded to the Caa category. GMAC LLC: -- Senior Unsecured: to Ca from C GMAC Australia LLC: -- Backed Senior Unsecured: to Ca from C GMAC Bank GMBH: -- Backed Senior Unsecured: to Ca from C GMAC International Finance B.V.: -- Backed Senior Unsecured: to Ca from C GMAC, Australia (Finance) Limited: -- Backed Senior Unsecured: to Ca from C GMAC (NZ) Limited: -- Backed Senior Unsecured: to Ca from C General Motors Acceptance Corp. of Canada Ltd.: -- Backed Senior Unsecured: to Ca from C Moody's has also assigned a rating of Ca to senior unsecured debt issued to holders that tendered old bonds as a part of GMAC's December 2008 bond exchange. The exchange bonds are guaranteed by certain GMAC subsidiaries. In Moody's view, the additional creditor protections associated with the guarantees is insufficient at this time to warrant a notching differential from GMAC's senior unsecured debt that does not benefit from these guarantees. In its last rating action on November 20, 2008, Moody's downgraded GMAC's rating to C from Caa1, following GMAC's launch of a debt exchange offering that Moody's viewed as a distressed exchange. GMAC LLC is a global financial services company operating in the automotive finance, dealer and personal line insurance, and residential real estate finance sectors. GMAC LLC: Moody's Upgrades Senior Unsecured Rating to 'Ca' ---------------------------------------------------------- Moody's Investors Service upgraded the senior unsecured rating of GMAC LLC to Ca from C. In addition, Moody's placed GMAC's senior unsecured and preferred stock ratings (currently C) on review for further possible upgrade. The ratings of Residential Capital LLC (senior at C), GMAC's residential mortgage finance subsidiary, were not affected by this action. Moody's said the upgrade of GMAC's rating reflects the firm's lower bankruptcy risk resulting from the U.S. government's support of the firm, including significant capital injections that have improved its liquidity and capital positions, partial U.S. government ownership, and GMAC's role in the U.S. government's efforts to reinvigorate the U.S. domestic auto industry. Of continuing concern, GMAC must yet raise substantial additional equity to comply with the requirements of the recently concluded stress tests under the U.S. government's Supervisory Capital Assessment Program. Though it is possible that GMAC could seek to fill a portion of the additional capital need through a distressed debt exchange, Moody's believes the motivation of bondholders to accept the terms of a distressed exchange are uncertain, given GMAC's lower risk of bankruptcy. Were such an exchange commenced, Moody's also believes that the result for bondholders would be consistent with the newly assigned Ca rating. "Capital inflows, partial government ownership, and GMAC's importance to reviving GM and Chrysler point to a lower probability of near-term default," said Moody's senior analyst Mark Wasden. "However, the challenges GMAC faces in executing its business strategy and the resultant uncertainties for bondholders remain a constraint on GMAC's credit." Government support of GMAC has been multifaceted. In May, GMAC issued $7.5 billion of mandatorily convertible preferred membership interests to the U.S. Treasury, $4 billion of which supports GMAC's agreement with Chrysler LLC to provide financing to Chrysler dealers and customers. GMAC was also approved to participate in the FDIC's Temporary Liquidity Guarantee Program, under which it can issue up to $7.4 billion in FDIC guaranteed debt by October 2009. GMAC issued $4.5 billion of TLGP debt on June 3, which Moody's rated Aaa. The U.S. government's ownership of GMAC is about 35%, which would increase upon conversion of the U.S. Treasury's MCP's. GMAC was also granted additional flexibility to issue GM-related auto finance receivables in GMAC Bank (a/k/a Ally Bank) under an expanded 23A exemption to the Federal Reserve Act. Assets originated in the bank are funded by deposits, which are a lower cost source of funding that GMAC has continued to access throughout the current cycle. Notwithstanding these positive developments, Moody's remains cautious regarding the operating and financial challenges GMAC faces. In particular, it is uncertain how GMAC will raise by November 2009 the $5.6 billion of "new" and $2.4 billion of "other" capital qualifying as Tier 1 common equity that is required by regulators. Moody's believes GMAC's access to private sources of capital to meet these requirements is limited and that the firm will most likely request an additional investment from the U.S. Treasury. GMAC is also contending with asset quality deterioration in its auto finance and residential mortgage operations that could lead to further operating losses during the current downcycle. Moody's rating anticipates that ResCap will continue to require capital support from GMAC as it services a large portfolio of troubled mortgages to liquidation. Additional long-term uncertainties relate to GMAC's eventual ownership structure and liquidity profile, as well as GMAC's relationships with "new" GM and Chrysler and the strength of their future operating prospects. Moody's believes that GMAC must eventually demonstrate capital and funding strategies that don't rely upon continued U.S. government involvement in the firm. During its review of GMAC's ratings, Moody's will seek clarity regarding GMAC's capital raising plans. Should the firm successfully fill the capital requirement while preserving the status and protections of senior creditors, its long-term ratings could be upgraded to the Caa category. GMAC LLC: -- Senior Unsecured: to Ca from C GMAC Australia LLC: -- Backed Senior Unsecured: to Ca from C GMAC Bank GMBH: -- Backed Senior Unsecured: to Ca from C GMAC International Finance B.V.: -- Backed Senior Unsecured: to Ca from C GMAC, Australia (Finance) Limited: -- Backed Senior Unsecured: to Ca from C GMAC (NZ) Limited: -- Backed Senior Unsecured: to Ca from C General Motors Acceptance Corp. of Canada Ltd.: -- Backed Senior Unsecured: to Ca from C Moody's has also assigned a rating of Ca to senior unsecured debt issued to holders that tendered old bonds as a part of GMAC's December 2008 bond exchange. The exchange bonds are guaranteed by certain GMAC subsidiaries. In Moody's view, the additional creditor protections associated with the guarantees is insufficient at this time to warrant a notching differential from GMAC's senior unsecured debt that does not benefit from these guarantees. In its last rating action on November 20, 2008, Moody's downgraded GMAC's rating to C from Caa1, following GMAC's launch of a debt exchange offering that Moody's viewed as a distressed exchange. GMAC LLC is a global financial services company operating in the automotive finance, dealer and personal line insurance, and residential real estate finance sectors. GOVERNMENT TELECOM.: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Government Telecommunications, Inc. aka GTI 4500 Southgate Pl., Suite 300 Chantilly, VA 20151 Bankruptcy Case No.: 09-14595 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Eastern District of Virginia (Alexandria) Debtor's Counsel: Steven B. Ramsdell, Esq. Tyler, Bartl, Ramsdell & Counts, P.L.C. 700 S. Washington St., Suite 216 Alexandria, VA 22314 Tel: (703) 549-5000 Fax: (703) 549-5011 Email: sramsdell@tbrclaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/vaeb09-14595.pdf The petition was signed by C. Andrew Wilson, controller of the Company. HAIGHTS CROSS: S&P Downgrades Corporate Credit Rating to 'CC' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on White Plains, New York-based supplemental education publisher Haights Cross Communications Inc. to 'CC' from 'CCC-'. At the same time, S&P placed the corporate credit rating, as well as all issue-level ratings for the company and its operating subsidiary, Haights Cross Operating Co., on CreditWatch with negative implications. The company had $381.8 million of total debt outstanding at Dec. 31, 2008. The rating actions reflect S&P's view that HCC's recent proposal to amend its credit agreement and restructure its debt, including a proposal to exchange its 12.5% senior discount notes for common stock and its proposal to repurchase a portion of its 11.75% senior notes at a 20% discount, would be tantamount to a default if completed. The debt restructuring plan entails issuing 120.21 shares of common stock for each $1,000 in principal amount at maturity of senior discount notes exchanged. The company had $133.6 million of discount notes outstanding at Dec. 31, 2008. The exchange offer expires on July 6, 2009. If the company completes this transaction, S&P would lower the current 'C' rating on the senior discount notes to 'D.' Standard & Poor's would consider the completion of the exchange to be tantamount to a default, because bondholders will be receiving equity instead of cash. In addition to restructuring its debt, HCC is also in discussions with its lenders regarding a proposed amendment to the credit agreement. The terms of the amendment include reducing the term loan by $17.5 million with cash on hand and repurchasing approximately $27.5 million of HCO's 11.75% senior notes at a 20% discount. If the company completes this transaction, S&P would lower the 'C' rating on these senior notes to 'D.' Standard & Poor's would consider the completion of the repurchase to be tantamount to a default because bondholders will be receiving less than par value for the notes and because of the company's financially distressed situation. If HCC is not able to complete the restructuring, the company plans to explore other restructuring alternatives, including the commencement of a Chapter 11 bankruptcy plan of reorganization. S&P views the company's high leverage, fractional coverage of gross interest expense, negative discretionary cash flow, limited liquidity, and weak operating outlook together as indications of financial distress. The supplemental education publisher has a competitive disadvantage based on its small size relative to its peers. Revenue was relatively flat in 2008 compared with 2007, reflecting modest growth of 3.4% revenue growth in the Library division, which offset a 2.8% decline in the Test Prep and Intervention segment. EBITDA for the fiscal year ended Dec. 31, 2008 declined by roughly 20%. Gross debt to EBITDA (after amortization of prepublication costs) was steep, at roughly 17x in the 12 months ended Dec. 31, 2008. EBITDA coverage of gross interest expense was inadequate, at 0.5x over the same period, and S&P expects this metric to face further pressure as interest expense increases during the forbearance period, which ends June 12, 2009 unless the company amends its credit agreement according to the proposed terms. Otherwise, the forbearance period ends on July 16, 2009. For the 12 months ended Dec. 30, 2008, discretionary cash flow was negative. "Upon consummation of the transactions, S&P expects to lower the corporate credit rating to 'SD' (selective default) and the issue- level ratings on the company's senior notes and senior discount notes to 'D'," noted Standard & Poor's credit analyst Tulip Lim. "As soon as possible thereafter, S&P will reassess the company's business outlook and financial profile and assign new ratings. S&P would also lower the rating if the company announces a Chapter 11 filing." HAROLD L. ROSBOTTOM: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Harold L. Rosbottom, Jr. 150 Pintail Road St. Rose, LA 70087 Bankruptcy Case No.: 09-11674 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Western District of Louisiana (Shreveport) Debtor's Counsel: Patrick S. Garrity, Esq. 13702 Coursey Blvd., Bldg. 3 Baton Rouge, LA 70817 Tel: (225) 751-1751 Fax: (225) 751-1998 Email: pgarrity@steffeslaw.com Estimated Assets: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/lawb09-11674.pdf The petition was signed by Mr. Rosbottom, Jr. HART-SAHARA LLC: Case Summary & 17 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Hart-Sahara, LLC 2950 East Flamingo Road, Ste. B Las Vegas, NV 89121 Bankruptcy Case No.: 09-19875 Chapter 11 Petition Date: June 10, 2009 Court: District of Nevada (Las Vegas) Debtor's Counsel: Kelly J. Brinkman, Esq. kbrinkman@gooldpatterson.com Goold Patterson Ales & Day 4496 S. Pecos Road Las Vegas, NV 89121 Tel: (702) 436-2600 Fax: (702) 436-2650 Estimated Assets: $10 million to $50 million Estimated Debts: $1 million to $10 million The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Deutche Banc Mortgage secured loan $6,750,000 1919 Industrial Road Las Vegas, NV 89102 Tel: (702) 388-1926 Hart, Theordora & Russel property $5,000 11521 Evergreen Creek Lane Las Vegas, NV 89135 Young Electric Sign Company sign $4,080 PO Box 11676 Tacoma,WA 9811-6676 Tel: (702) 876-8080 Fax: (702) 944-4500 Woods, Terri trade services $2,240 Amnet Insurance insurance $3,181 Pasley, Diana janitorial $700 Johson, Juliana trade servcies $600 Go Bid Landscaping landscaping $450 NV Energy utilities $391 Desert Fire Protection trade $150 Southwest Gas Corporation gas $0 Republic Services trash $0 Office of the County taxes $0 Treasurer Las Vegas Valley Water water $0 District City of Las Vegas services $0 EMBARQ services $0 The petition was signed by Dora Hart. HEALTHSOUTH CORPORATION: Moody's Upgrades Corporate Rating to 'B2' ------------------------------------------------------------------ Moody's Investors Service upgraded the Corporate Family and Probability of Default Ratings of HealthSouth Corporation to B2 from B3 and changed the ratings outlook to stable from positive. Concurrently, Moody's affirmed the ratings of HealthSouth's individual debt instruments, including the Ba3 rating on its senior secured credit facility and the Caa1 rating on its senior unsecured notes. Additionally, Moody's affirmed HealthSouth's Speculative Grade Liquidity Rating at SGL-2. The upgrade of the Corporate Family Rating reflects the company's continued progress in credit metric improvement through both debt reduction and earnings growth. Operating performance has benefited from HealthSouth's greater than expected volume growth over the last several quarters, which helped to mitigate pricing pressures caused by a roll back and subsequent freeze of Medicare reimbursement rates. However, the rating is constrained by the expectation that the company will continue to operate with a considerable amount of financial leverage. Additionally, the high concentration of revenue from government payers remains a concern. The stable outlook reflects Moody's expectation of continued improvement in operating performance providing a greater ability to reduce debt with internal cash flow. The outlook also reflects Moody's expectation that the company will maintain a disciplined approach to acquisitions while continuing to invest in the growth of its existing facilities. Following is a summary of Moody's actions. Ratings upgraded: -- Corporate Family Rating to B2 from B3 -- Probability of Default Rating to B2 from B3 Ratings affirmed/LGD assessments revised: -- Senior secured revolving credit facility due 2012, Ba3 (LGD2, 24%) -- Senior secured term loan due 2013, Ba3 (LGD2, 24%) -- 10.75% senior unsecured notes due 2016 to Caa1 (LGD5, 80%) from Caa1 (LGD5, 78%) -- Senior unsecured floating rate notes due 2014 to Caa1 (LGD5, 80%) from Caa1 (LGD5, 78%) -- Speculative Liquidity Rating, SGL-2 -- Outlook changed to stable from positive. Moody's last rating action was on August 27, 2008, when a positive outlook was placed on the rating and Moody's upgraded the Speculative Grade Liquidity Rating to SGL-2. All other ratings were affirmed including the B3 Corporate Family and Probability of Default Ratings. Headquartered in Birmingham, Alabama, HealthSouth operates inpatient rehabilitation hospitals and long-term acute care hospitals. HealthSouth recognized approximately $1.9 billion of revenue in the twelve months ended March 31, 2009. HENDRICKS FURNITURE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Hendricks Furniture Group, LLC dba Boyles Distinctive Furniture dba Naja Oriental Rugs fka The Country Shop, Inc. fka Hendricks Furniture Group, Inc. fka Hendricks Furniture Group Of NC, LLC fdba Sleep To Live Hendricks fdba Hendricks Furniture PO Box 3827 Hickory, NC 28603 Bankruptcy Case No.: 09-50790 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Classic Moving & Storage, Inc. 09-50791 Norris Furniture And Interiors, Inc. 09-50792 Type of Business: The Debtors make and sell furnitures. See http://www.boyles.com/ Chapter 11 Petition Date: June 10, 2009 Court: Western District of North Carolina (Wilkesboro) Judge: J. Craig Whitley Debtors' Counsel: Albert F. Durham, Esq. adurham@rcdlaw.net Rayburn, Copper & Durham, P.A. 1200 Carillon 227 W. Trade Street Charlotte, NC 28202 Tel: (704) 334-0891 Estimated Assets: $50 million to $100 million Estimated Debts: $10 million to $50 million The Debtors' Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Noori Liquidation Center $587,309 135 Madison Avenue New York, NY 10016 Fine Furniture Design & Marketing $359,845 1107 North Main Street High Point, NC 27262 Michael Aziz Oriental Rugs, Inc. $329,994 302 Fifth Avenue 12th Floor New York, NY 10001 American Express $276,076 Kingsdown Inc. $260,695 Centre at Wellington Green Ltd. $256,546 Hooker Furniture Corp. $227,427 Henkel-Harris Co., Inc. $225,638 Jenkins, Lisa $189,520 Baker Furniture Company $186,674 Sherrill Furniture Co. $185,640 Gouge, Michael R. $170,119 Stacy, Mahalia L. $152,465 Century Furniture Co. $147,845 Marge Carson, Inc. $144,761 Roseman, Terry $143,641 Vuchic, Boris V. $134,797 Stanley Furniture $134,163 Hickory Furniture Mart $122,084 Bashian Bros., Inc. $121,603 The petition was signed by Larry G. Hendricks, chief executive officer. HENDRICKS FURNITURE: Files for Chapter 11 Bankruptcy Protection --------------------------------------------------------------- Devetta Blount at Digitriad.com reports that Hendricks Furniture Group, LLC, and sister company Classic Moving and Storage have filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Western District of North Carolina. According to Digitriad.com, Hendricks and Classic Moving said that they will continue their restructuring activities with the support of primary lenders and key manufacturing partners. Digitriad.com relates that the Debtors have secured up to $2.5 million of postpetition financing from Branch Banking & Trust Company and certain other lenders, as well as support from leading furniture manufacturers which assisted in developing a plan to supply goods to the Company on normal credit and trade terms after the bankruptcy filing. Digitriad.com states that the Debtors sought the support of BB&T and top furniture manufacturers to protect customer orders, deposits, and confidence during the transition. The Debtors' founder, Larry G. Hendricks, cited the failed Norris Furniture and other non-Boyles retail divisions, as well as the subsequent obligations resulting from numerous store closings in an extremely distressed commercial real estate market, as reasons of the Debtors' bankruptcy filing. Hendricks Furniture Group is comprised of Boyles Distinctive Furniture, with five retail locations across North and South Carolina, and rug importer and distributor Naja Rugs. Hendricks and its sister company Classic Moving and Storage, are headquartered in Conover, North Carolina, and serve customers throughout the U.S. HEXION SPECIALTY: Issues Results of Tender Offer for Debentures --------------------------------------------------------------- Hexion Specialty Chemicals Inc. reported the expiration and final results of its cash tender offer to purchase its outstanding 8.375% Debentures due 2016, 9.200% Debentures due 2021, and 7.875% Debentures due 2023, up to the maximum aggregate principal amount of $20,000,000. The Tender Offer expired and the early participation date for the Tender Offer occurred at midnight, New York City time, on June 8, 2009. Hexion has accepted for purchase all of the Notes validly tendered in the Tender Offer. The aggregate principal amount of the 8.375% Debentures validly tendered pursuant to the Tender Offer was $5,031,000, representing approximately 6.49% of outstanding 8.375% Debentures. The total consideration payable per $1,000 principal amount of 8.375% Debentures is $280. In addition, the aggregate principal amount of the 9.200% Debentures validly tendered pursuant to the Tender Offer was $5,289,000, representing approximately 4.98% of outstanding 9.200% Debentures. The total consideration payable per $1,000 principal amount of 9.200% Debentures is $280.00. The aggregate principal amount of the 7.875% Debentures validly tendered pursuant to the Tender Offer was $10,775,000, representing approximately 4.64% of outstanding 7.875% Debentures. The total consideration payable per $1,000 principal amount of 7.875% Debentures is $280. On the settlement date, expected to be June 12, 2009, Hexion will pay to The Depository Trust Company the total consideration payable to holders in the Tender Offer, and Global Bondholder Services Corporation, the depositary for the Tender Offer, will irrevocably instruct The Depository Trust Company to pay to the validly tendering holders the total tender offer consideration, including accrued but unpaid interest on the accepted Notes from the last applicable interest payment date to, but not including, the actual date of purchase. About Hexion Specialty Based in Columbus, Ohio, Hexion Specialty Chemicals Inc. -- http://www.hexionchem.com/-- is a producer of thermosetting resins, or thermosets. Thermosets are a critical ingredient in virtually all paints, coatings, glues and other adhesives produced for consumer or industrial uses. Hexion Specialty Chemicals is controlled by an affiliate of Apollo Management L.P. * * * Troubled Company Reporter said on April 23, 2009, Standard & Poor's Ratings Services said that it lowered its ratings on Columbus, Ohio-based Hexion Specialty Chemicals Inc., including its corporate credit rating to 'SD' from 'CCC+'. Moody's Investors Service, TCR reported on April 22, 2009, lowered the Corporate Family Rating of Hexion Specialty Chemicals, Inc., to B3 from B2. Moody's also lowered the rating on the company's senior secured first lien revolving credit facility, letter of credit facility and term loan to B1 from Ba3; its secured second lien notes to Caa1 from B3; and its unsecured notes and debentures to Caa2 from Caa1. The Company's Speculative Grade Liquidity Rating was lowered to SGL-3 from SGL-2. The rating outlook is negative. IGLESIA DE RESTAURACION: Case Summary & 3 Largest Unsec. Creditors ------------------------------------------------------------------ Debtor: Iglesia de Restauracion Apostoles y Profetas, Inc. aka Iglesia Evangelica de Restauracion Apostloes y Profetas, Inc. 880 Bonifant Street Silver Spring, MD 20910 Bankruptcy Case No.: 09-20479 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court District of Maryland (Greenbelt) Judge: Thomas J. Catliota Debtor's Counsel: Richard J. Link, Esq. Karpel & Link 200-A Monroe Street, Suite 330 Rockville, MD 20850 Tel: (240) 453-9191 Fax: (240) 453-9944 Email: karpel-link@verizon.net Total Assets: $1,740,399 Total Debts: $2,096,161 A full-text copy of the Debtor's petition, including a list of its 3 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/mdb09-20479.pdf IMAGE PACKAGING: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Image Packaging of Horwitz, Inc. dba Image Packaging P.O. Box 1212 Horseheads, NY 14845 Bankruptcy Case No.: 09-21550 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Western District of New York (Rochester) Debtor's Counsel: Leonard Relin, Esq. One East Main Street, 10th Floor Rochester, NY 14614 Tel: (585) 454-4336 Fax: (585) 232-6674 Email: lrelin@rochester-law.com Total Assets: $198,642 Total Debts: $1,400,066 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/nywb09-21550.pdf The petition was signed by Margaret Thoma, president of the Company. INTERNATIONAL PRINTING: Case Summary & 20 Largest Unsec. Creditors ------------------------------------------------------------------ Debtor: International Printing & Ad Specialties, Inc. 1756 S.E. South Niemeyer Circle Port Saint Lucie, FL 34952 Bankruptcy Case No.: 09-21516 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. ------ -------- Team IP Holdings, LLC 09-21517 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Southern District of Florida (West Palm Beach) Judge: Paul G. Hyman, Jr. Debtor's Counsel: John B. Culverhouse, Sr., Esq. 320 S Indian River Dr # 100 Ft Pierce, FL 34950 Tel: (772) 465-7572 Email: bradculverhouselaw@gmail.com Estimated Assets: 500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flsb09-21516.pdf The petition was signed by Randall L. Sparks, CEO and president of the Company. JAMES C. DOCHEFF: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Joint Debtors: James C. Docheff, Jr. dba Diamond D. Dairy mem Diamond D. Drinkable Yogurt,Llc Kristie J. Docheff dba Diamond D. Dairy mem Diamond D. Drinkable Yougurt, Llc aka Kristie Jo Docheff 4513 CR 32 Longmont, CO 80504 Bankruptcy Case No.: 09-21208 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court District of Colorado (Denver) Judge: Howard R. Tallman Debtors' Counsel: Nancy D. Miller, Esq. 1050 17th St., Suite 2500 Denver, CO 80265 Tel: (303) 825-2700 Email: nmiller@kcfpc.com Total Assets: $3,984,280 Total Debts: $8,596,344 A full-text copy of the Debtors' petition, including a list of their 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cob09-21208.pdf The petition was signed by the Joint Debtors. JD NEWTON: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: JD Newton Construction, Inc. PO Box 6008 Edmonds, WA 98026 Bankruptcy Case No.: 09-15636 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Western District of Washington (Seattle) Judge: Thomas T. Glover Debtor's Counsel: Larry B. Feinstein, Esq. Vortman & Feinstein 500 Union St., Ste 500 Seattle, WA 98101 Tel: (206) 223-9595 Email: lbf@chutzpa.com Total Assets: $1,278,072 Total Debts: $2,099,230 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/wawb09-15636.pdf The petition was signed by James D. Newton, president of the Company. JOHN MANEELY: Moody's Downgrades Corporate Family Rating to 'B2' ---------------------------------------------------------------- Moody's Investors Service downgraded John Maneely Company's ratings, lowering the company's corporate family rating to B2 from B1, and kept the company's ratings under review for possible further downgrade. The rating for JMC's term loan was lowered to B3 from B2 and the rating for the company's and co-borrower 6582125 Canada Inc.'s asset-based revolving credit facility was lowered to Ba2 from Ba1. The downgrade and ongoing review recognize the challenges JMC is facing as demand for welded mechanical steel pipe has fallen appreciably with the slowdown of North American non-residential construction activity. Moody's expects JMC's 2009 shipment volumes will be down 40-45% from 2008 levels. In Moody's opinion, the reduced volume, as well as lower selling prices and interest expense associated with the company's very high leverage, will make it difficult to generate meaningful operating income and cash flow. Furthermore, a continuation of these conditions could endanger covenant compliance under the company's revolving credit facility and term loan agreements, although there is no danger of this in 2009. Currently, JMC has adequate liquidity. Approximately 80% of JMC's sales go into the non-residential construction market, where 2009 expenditures in the U.S. are expected to fall by around 30%. Moody's expects market conditions to be weak for several years. Year-over-year, JMC's shipments fell 41% in the March 2009 quarter (its second fiscal quarter). The company is adjusting its manufacturing base and employment accordingly. However, even with lower steel input costs and reduced headcount, Moody's believes JMC's operating income, excluding unusual adjustments, will be minimal at these anemic sales levels. However, the company's cash position is strong as it benefited in the second quarter from a release of cash from working capital and a $229 million net settlement with Novolipetsk Steel OJSC related to NLMK's termination of its agreement to acquire JMC. Given the severity of the downturn and the numerous adjustments that JMC is making to right-size its business, Moody's review will allow for a closer inspection of the company's current cost structure, as well as potential impacts on working capital and cash. JMC's debt, even on a net debt basis, is high in absolute terms, and an extended period of weak sales could put it at risk of financial covenant violations in 2010, once the NLMK settlement is no longer included in the calculation of the credit facility's leverage ratio (debt to EBITDA). Therefore, the review will examine JMC's cash flow, covenant compliance and liquidity under a range of demand forecasts. These ratings were downgraded: For John Maneely Company: * Corporate family rating -- to B2 from B1 * Probability of default rating -- to B2 from B1 * US$300 million asset based revolving credit facility due 2011 -- to Ba2 (LGD2, 22%) from Ba1 * US$1,094 million term loan facility due 2013 -- to B3 (LGD4, 59%) from B2 For 6582125 Canada Inc.: * US$100 million asset based revolving credit facility due 2011 -- to Ba2 (LGD2, 22%) from Ba1 Moody's previous rating action for JMC was on October 30, 2008, when the company's rating outlook was confirmed with a stable outlook. Headquartered in Beachwood, Ohio, John Maneely Company manufactures steel pipe, hollow structural steel, electrical conduit products and tubular products at ten manufacturing facilities in the U.S. and Canada. The company is number one or two in its key product areas: HSS, standard pipe and electrical conduit. JMC also enjoys leading market positions in the galvanized mechanical tube and fittings markets. Its products are sold principally to plumbing and electrical distributors. JMC's parent, DBO Holdings, Inc., is approximately 55% owned by the Carlyle Partners IV, LP. JT TRUCKING: Case Summary & 12 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: JT Trucking, Inc. 637 Branchton Road Slippery Rock, PA 16057 Bankruptcy Case No.: 09-24369 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Western District of Pennsylvania (Pittsburgh) Debtor's Counsel: Donald R. Calaiaro, Esq. Calaiaro & Corbett, P.C. Grant Building, Suite 1105 310 Grant Street Pittsburgh, PA 15219-2230 Tel: (412) 232-0930 Fax: (412) 232-3858 Email: dcalaiaro@calaiarocorbett.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 12 largest unsecured creditors is available for free at: http://bankrupt.com/misc/pawb09-24369.pdf The petition was signed by Tammy Straughn, president of the Company. KAREN HUNTER: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Joint Debtors: Karen Hunter Kenneth J. Hunter 42 W. Grant Avenue Roselle Park, NJ 07204 Bankruptcy Case No.: 09-24891 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court District of New Jersey (Newark) Debtors' Counsel: Leonard C. Walczyk, Esq. Wasserman, Jurista & Stolz 225 Millburn Ave., Suite 207 P.O. Box 1029 Millburn, NJ 07041-1712 Tel: (973) 467-2700 Email: lwalczyk@wjslaw.com Total Assets: $1,503,978 Total Debts: $1,835,891 A full-text copy of the Debtors' petition, including a list of their 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/njb09-24891.pdf The petition was signed by the Joint Debtors. KINETEK HOLDINGS: Debt Repurchase Prompts S&P's Rating Cut to 'D' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Deerfield, Illinois-based electrical motor and controls systems manufacturing company Kinetek Holdings Corp., including lowering the corporate credit rating to 'SD' (selective default) from 'B-' and the issue-level rating on its first-lien debt and second-lien debt to 'D'. "The rating actions reflect confidential information that Kinetek has made available to Standard & Poor's Ratings Services regarding the repurchase of its own debt, which has caused us to have a different view than had been reflected in the previous ratings," said Standard & Poor's credit analyst Helena Song. S&P expects to assign a new corporate credit rating to Kinetek in the next two weeks. S&P will base the new rating on, among other things, S&P's assessment of the company's new capital structure and liquidity profile. KOBRA PROPERTIES: Chapter 11 Trustee Hires Committee's Counsel -------------------------------------------------------------- WestLaw reports that a Chapter 11 trustee who was unable to find any other eligible attorneys willing to serve as his counsel would be allowed to employ the law firm that had previously represented the official committee of unsecured creditors, but that, with the committee's consent, had withdrawn to represent the trustee. The dearth of suitable eligible counsel, the universal consent by creditors following full disclosure, and general coincidence of the economic interests of unsecured creditors and of the trustee in optimizing the value of the jointly administered estates, combined to warrant the trustee's employment of the withdrawing committee counsel. In re Kobra Properties, --- B.R. ----, 2009 WL 1538545 (Bankr. E.D. Cal.). Steven L. Victor of Development Specialists Inc. serves as the Chapter 11 bankruptcy trustee for Kobra Properties and its debtor- affiliates, Kobra Preserve, LLC, Vernon Street Associates, LLC, and Rocky Ridge Center, LLC. As reported in the Troubled Company Reporter on April 8, 2009, Kobra's creditors' committee requested the appointment of a Chapter 11 trustee to displace Kobra's founder Abe Alizadeh. Headquartered in Roseville, California, Kobra Properties and its affiliates construct, own, and operate eighty-eight diverse commercial properties located primarily in California's Central Valley. Some of the affiliates operate enterprises, including franchised restaurants (e.g., Jack in the Box, T.G.I. Friday's, Qdoba), that are tenants of the debtors. The Debtors' Schedules show liabilities of $418 million and $665 million in assets, which the Chapter 11 trustee estimates worth $375 million to $400 million. The largest creditor is Wells Fargo Bank, which claims $154 million in its own right and $71 million as administrative agent and sole lead arranger of a loan syndicate. Kobra filed for Chapter 11 protection on Nov. 25, 2008 (Bankr. E.D. Calif. Case No. 08-37271). Leonard M. Shulman, Esq., at Shulman Hodges & Bastian LLP, represents the Debtors. Donald W. Fitzgerald, Esq., at Felderstein Fitzgerald Willoughby & Pascuzzi LLP, in Sacramento, represents the Chapter 11 Trustee. LANDSOURCE COMMUNITIES: Court Sets July 13 Confirmation Hearing --------------------------------------------------------------- Judge Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware will convene a hearing on July 13, 2009, at 10:00 a.m. Eastern Time to consider confirmation of the Second Amended Joint Plan of Reorganization filed by Barclays Bank PLC for LandSource Communities Development LLC and its debtor- affiliates. Objections to the confirmation of the Plan must be filed no later than July 6, 2009 at 4:00 p.m. Eastern Time. The Official Committee of Unsecured Creditors and the Second Lien Agent may file their confirmation objections on or before July 7, 2009, at 7:00 p.m. Eastern Time. Any party supporting the Second Amended Plan may file a reply to any objection to the Plan Confirmation by July 10, 2009. As previously reported by the Troubled Company Reporter, the Court approved the Second Amended Disclosure Statement explaining the Second Amended Joint Plan of Reorganization filed by Barclays Bank PLC on June 2, 2009, as containing adequate information within the meaning of Section 1125 of the Bankruptcy Code. A full-text copy of the Disclosure Statement Order is available for free at: http://bankrupt.com/misc/LandS_DSOrder.pdf June 1, 2009, is established as the record date for purposes of determining the holders of Claims and Interests entitled to receive the Solicitation Package and to vote on the Second Amended Plan. The June 1 Voting Record Date will also serve as the date for determining the eligible holders permitted to participate in the Rights Offering contemplated under the Plan. The Court also approved the form of the Ballots. All Ballots must be properly executed, completed and delivered to the Balloting Agent at this address so that the Ballots are received no later than July 6, 2009, at 5 p.m. prevailing Pacific Time: LandSource Ballot Processing Center c/o Kurtzman Carson Consultants LLC 2335 Alaska Avenue El Segundo, CA 90245 Creditors seeking to have a claim temporarily allowed for purposes of voting to accept or reject the Second Amended Plan pursuant to Rule 3018(a) of the Federal Rules of Bankruptcy Procedure must file a motion for that relief no later than June 29, 2009. The Debtors are to file a Plan Supplement by June 12, 2009. The Court orders that a second Plan Supplement will be filed on June 19, and will list agreements that were listed in the Schedules as executory contracts or unexpired leases, but as to which the Debtors and the Plan Proponent believe should not be considered executory contracts or unexpired leases. Counterparties to any of the agreements who believe that the agreement does constitute an executory contract or unexpired lease must file an objection to the characterization of the agreement on or before July 6, 2009 at 4:00 p.m. Eastern Time. The second Plan Supplement to be filed June 19 will also include an estimate of rejection damages, the identity of the Creditor Trustee, and the identity of the Creditor Trust Advisory Board. Prior to the entry of the Disclosure Statement Order, the California Public Employees' Retirement System, Lakes by the Bay South Community Development District, Maricopa County Treasurer and Steadfast Insurance Company, withdrew with prejudice their objections to the Seconded Amended Disclosure Statement. Before the Disclosure Statement Order was signed, more parties also made known to the Court their objection to the Disclosure Statement explaining the Plan Proponent's First Amended Plan: * The Official Committee of Unsecured Creditors * The Bank Of New York * California Public Employees' Retirement System * CH2M Hill Constructors Inc. * Steadfast Insurance Company * Sam Hill & Sons, Inc. * Chaudhary & Associates, Inc. * Ghilotti Construction Company, Inc. * California Department of Toxic Substances Control * California State Water Resources Control Board * California Regional Water Quality Control Board, San Francisco Bay Region * Southern Sun Construction Company * Oakridge Landscape Inc. * Pacific Advanced Civil Engineering, Inc. To all the Disclosure Statement objections raised, the Plan Proponent insisted that it proposed the Second Amended Plan after an extensive analysis of exit strategies, negotiations with Lennar Corporation, Emile Haddad and the parties backstopping the Rights Offering contemplated by the Plan. Barclays Bank PLC, as administrative agent for itself and various lenders under a certain Superpriority DIP First Lien Credit Agreement, delivered to the U.S. Bankruptcy Court for the District of Delaware a Revised Second Amended Joint Plan of Reorganization for LandSource Communities Development LLC and its 20 debtor- affiliates and an accompanying Disclosure Statement on May 19, 2009. Subsequently, the Plan Proponent delivered to the Court a further revised a Second Amended Plan and Disclosure Statement dated June 2, 2009. The Second Amended Plan provides that on the Effective Date, Reorganized LandSource Communities will have no debt for borrowed money, subject to any outstanding letters of credit, and will have at least $90 million of cash. The Plan Proponent believes that Reorganized LandSource will emerge from bankruptcy well capitalized. According to the Plan Proponent, the Business Plan forecasts that Reorganized LandSource will not need any additional funding during the first phase of development through May 31, 2012. Thereafter, Reorganized LandSource is likely to need some additional funding. The Plan Proponent believes that Reorganized LandSource will be able to obtain any funding at that time, particularly given that Reorganized LandSource will emerge from bankruptcy debt-free. A full-text copy of the June 2 Second Amended Plan is available for free at: http://ResearchArchives.com/t/s?3dba A full-text copy of the June 2 Disclosure Statement is available for free at: http://ResearchArchives.com/t/s?3db9 About LandSource Communities LandSource Communities Development LLC, which operates in Arizona, California, Florida, New Jersey, Nevada and Texas, is involved in the planning and development of master planned communities and transforming undeveloped land into ready-to-build home sites and commercial properties. With the exception of one development project in Marina del Rey, California, LandSource does not build homes or commercial properties. LandSource and 20 of its affiliates filed for Chapter 11 bankruptcy protection before the U.S. Bankruptcy Court for the District of Delaware on June 8, 2008 (Lead Case No. 08-11111). The Debtors are represented by Marcia Goldstein, Esq., at Weil Gotshal & Manges in New York, and Mark D. Collins, Esq., at Richards Layton & Finger in Wilmington, Delaware. Lazard Freres & Co. acts as the Debtors' financial advisors, and Kurtzmann Carson Consultants serves as the Debtors' notice and claims agent. According to the Troubled Company Reporter on May 22, 2008, LandSource sought help from its lender consortium to restructure $1.24 billion of its debt. LandSource engaged a 100-bank lender group led by Barclays Capital Inc., which syndicates LandSource's debt. LandSource had received a default notice on that debt from the lender group after it was not able to timely meet its payments during mid-April. However, LandSource failed to reach an agreement with its lenders on a plan to modify and restructure its debt, forcing it to seek protection from creditors. Bankruptcy Creditors' Service, Inc., publishes LandSource Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by LandSource Communities Development LLC and its various affiliates. (http://bankrupt.com/newsstand/or 215/945- 7000) LBI MEDIA: S&P Downgrades Corporate Credit Rating to 'B-' --------------------------------------------------------- Standard & Poor's Rating Services said that it lowered its corporate credit rating on LBI Media Inc. to 'B-' from 'B', reflecting weak advertising demand and thinning liquidity following the onset of cash interest payments on its 11% discount notes in April 2009. The outlook is negative. At the same time, S&P lowered its issue-level rating on LBI's secured debt to 'B-' (the same level as the corporate credit rating) from 'B+' and revised the recovery rating to '3', indicating S&P's expectation of meaningful (50%-70%) recovery in the event of a payment default, from '2'. The revision of the recovery rating reflects a lower enterprise value than S&P had used in S&P's previous analysis, as S&P's current projections of EBITDA levels in 2009 are now meaningfully lower than those previously used. S&P also lowered its issue-level rating on LBI Media Inc.'s $225 million 8.5% senior subordinated notes to 'CCC' (two notches lower than the corporate credit rating). The recovery rating remains '6', indicating S&P's expectation of negligible (0%-10%) recovery in the event of a payment default. "We expect weak radio and TV ad demand will continue to pressure LBI's revenue in 2009, especially in the company's California markets where the recession has affected LBI's infomercial business," said Standard & Poor's credit analyst Michael Altberg. "Despite our view that the company will maintain an adequate margin of compliance against its financial maintenance covenant and access to its $150 million revolving credit facility, S&P is concerned that weak operating performance in conjunction with the recent onset of cash interest payments on its 11% discount notes will lead to further deterioration in credit metrics." The ratings reflect weak credit metrics due to LBI's highly leveraged capital structure, negative discretionary cash flow, cash flow concentration in a small number of large U.S. Hispanic markets, intense competition for audiences and advertisers from much larger rivals, and financial risk associated with its debt- financed acquisition strategy. The company's niche position as an operator of Spanish-language radio and TV stations, its healthy EBITDA margin relative to peers, and broadly favorable Spanish- language advertising trends, are modestly positive factors that do not offset these risks. LBI is a Spanish-language radio and TV broadcaster that owns 22 radio stations and six TV stations in Los Angeles (including Riverside-San Bernardino) and San Diego, Calif.; Houston and Dallas-Fort Worth, Texas; Salt Lake City, Utah; and Phoenix, Arizona. The negative rating outlook reflects S&P's expectation that credit metrics will weaken over the intermediate term as TV and radio ad demand remains under cyclical pressure. S&P could lower the rating if deterioration in operating performance markedly weakens coverage ratios. More specifically, S&P would lower the rating if S&P become convinced that a 20% EBITDA decline from March 31, 2009, levels is likely, which would raise the possibility of EBITDA coverage of interest (pro forma for a full year of cash interest expense on the 11% discount notes) to approach 1x. Conversely, an outlook revision to stable, which S&P does not view as likely over the near term, would require the company to lower debt leverage and restore stable positive discretionary cash flow. LEHMAN BROTHERS: Creditors Panel Also Wants Barclays Docs --------------------------------------------------------- The Official Committee of Unsecured Creditors in Lehman Brothers Holdings Inc. and its debtor-affiliates Chapter 11 cases asks the U.S. Bankruptcy Court for the Southern District of New York that any order issued approving the proposed investigation of Barclays Capital Inc. should also provide that the panel receive copies of the documents produced to Lehman Brothers Holdings Inc. The Creditors' Committee also asks the Court to allow its representatives to appear and propound questions at any deposition noticed in accordance with that order. As reported by the Troubled Company Reporter on May 22, 2009, Lehman Brothers Holdings Inc., which is now being led by Chief Executive Officer Bryan Marsal, asked the Court for permission to conduct focused discovery against Barclays concerning matters of importance to the estate and its creditors. Barclays purchased substantially all of Lehman's North American broker-dealer assets in a sale transaction negotiated, approved and executed within the span of a few days immediately following LBHI's filing for bankruptcy. The requested discovery, under Fed. R. Bankr. P. 2004, relates to that highly expedited transaction, and related matters, and is specifically focused on whether the estate received appropriate value. Barclays' Defense Lehman Brothers Holdings, Inc.'s discovery request on Barclays Capital, Inc., amounts to a wholesale attack of the order signed in September 2009 by Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York approving Barclays acquisition of Lehman's North American investment banking business, Hamish P.M. Hume, Esq., at Boies, Schiller & Flexner, LLP, in New York, argues for Barclays. LBHI's proposed discovery cannot possibly benefit LBHI's estate because the potential claims have no merit and the estate already has access to any information it reasonably could need, Barclays asserts. Mr. Hume points out that, contrary to the Debtors' allegations: (a) while the Asset Purchase Agreement obliged Barclays to make certain categories of payments, it did not specify precise dollar amounts for either bonuses or cure payments; instead, LBHI presented the Bankruptcy Court with estimates of those numbers, which were always represented to be estimates and never as a specifically required amounts; (b) in the Order approving the Sale, the Bankruptcy Court found that the consideration was fair, and that the transaction was entered into in good faith and was in the interest of the Estate; and those findings were based on representations and evidence proffered by LBHI's own counsel, who explained that the consequences of denying the transaction would be catastrophic to the entire financial system, that Barclays was the only eligible acquirer and made the "highest and best offer," and that the Lehman assets being acquired were losing millions of dollars in value everyday; and (c) at the request of the Federal Reserve and Lehman Brothers, Inc., Barclays advanced $45 billion pursuant to a tri- party repurchase agreement to fund LBI's operations before Barclays even had any assurances as to whether the transaction would ultimately be approved, and at a time when the securities underlying the repurchase agreement were rapidly deteriorating in value. Barclays, in addition to the $45 billion advance, ultimately paid $1.29 billion for real estate, transferred $250 million to The Depository Trust & Clearing Corporation to cover LBI trading activities, and assumed other liabilities of uncertain amounts -- all despite considerable uncertainty regarding the value of the assets Barclays was acquiring and whether Lehman employees would transfer their employment to Barclays, Mr. Hume further points out. "There is no basis for alleging that Barclays has failed to comply with any of the terms of this transaction, much less for requesting that the entire transaction be re-examined, re- evaluated, and "re-traded" as LBHI proposes," Mr. Hume argues. Despite Barclays' attempts to cooperate with LBHI, LBHI has refused to meet with Barclays executives concerning the investigation and discovery issues and LBHI's special counsel abruptly terminated ongoing meet-and-confer discussions in order to file the discovery motion, Mr. Hume tells the Court. While Barclays objects to the exceptional burden posed by LBHI's requests and although LBHI already has access to much of the information it asks Barclays to produce, Mr. Hume says Barclays is willing to provide LBHI with responsive documents that Barclays intends to produce in response to the ongoing investigation by Anton Valukas, the court-appointed examiner in the Debtors' Chapter 11 cases, subject to any objections the Examiner may have and the execution of a confidentiality stipulation. In particular, Mr. Humes says Barclays will produce documents sufficient to show the amounts it has paid in bonus and other compensation, and the amounts it has paid in contractual "cure payments." Barclays asks the Court to deny the Debtors discovery request pursuant to Rule 2004 of the Federal Rules of Bankruptcy Procedure arguing that Rule 2004 does not permit discovery that is enormously burdensome, irrelevant to any legitimate issue involving the estate, sought solely to explore facially meritless claims, or which seeks information that is already available to the movant. LBHI and Barclays previously entered into a stipulation adjourning the hearing on the proposed investigation of the U.K. bank to June 24, 2009. Creditors and other concerned parties had until June 5 to file their objections. Responses or replies, if any, to the objections must be filed and served on or before June 23. Lehman Brothers' Collapse Founded in 1850, Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States, offering a full array of financial services in equity and fixed income sales, trading and research, investment banking, asset management, private investment management and private equity. Its worldwide headquarters in New York and regional headquarters in London and Tokyo are complemented by a network of offices in North America, Europe, the Middle East, Latin America and the Asia Pacific region. Lehman filed for Chapter 11 on September 15, 2008 (Bankr. S.D. N.Y. Case No. 08-13555) after Barclays PLC and Bank of America Corp. backed out of a deal to acquire the company, and the U.S. Treasury refused to provide financial support that would have eased out a sale. Lehman's bankruptcy petition listed $639 billion in assets and $613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several affiliates filed bankruptcy petitions thereafter. On September 19, 2008, Lehman Brothers, Inc., was placed in liquidation pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119). James W. Giddens was appointed trustee for the SIPA liquidation of the business of LBI. Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed a petition under Chapter 15 of the U.S. Bankruptcy Code on February 10, 2009. Lehman Brothers Finance, a subsidiary of Lehman Brothers Inc., estimated both its assets and liabilities at more than $1 billion. LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, has been placed into administration, together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to wind down the business of LBI (Europe) on September 15, 2008. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. The two units have combined liabilities of JPY4 trillion -- US$38 billion. Akio Katsuragi, a former Morgan Stanley executive, runs Lehman's Japan units. Lehman Brothers Asia Limited, Lehman Brothers Securities Asia Limited and Lehman Brothers Futures Asia Limited suspended operations upon the bankruptcy filing of their U.S. counterparts. Asset Sales Barclays Bank Plc has acquired Lehman's North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, on September 22 reached an agreement to purchased Lehman Brothers Holdings, Inc.'s operations in Europe and the Middle East less than 24 hours after it reached a deal to buy Lehman's operations in the Asia Pacific for US$225 million. Nomura paid only US$2 dollars for Lehman's investment banking and equities businesses in Europe, but agreed to retain most of Lehman's employees. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Seeks to Restructure Loans With Broadway Partners ------------------------------------------------------------------ Prior to its bankruptcy filing, Lehman Brothers Holdings Inc. provided more than $459 million in mezzanine loans to affiliates of Broadway Partners Fund Manager LLC, in connection with the Broadway Partners Entities' acquisition of indirect ownership interests in various office properties located in Massachusetts, New York, Virginia and California. Of the $459 million, $321,984,921 was provided by LBHI pursuant to a loan agreement dated July 10, 2007, while $137,627,670 was made available under a loan agreement dated August 15, 2007. In addition to the $459 million, certain "senior lenders" also provided loans secured by mortgages on and indirect ownership interests in the office properties, the proceeds of which were also used to fund the acquisition of the properties by Broadway's affiliates. Attorney for LBHI, Shai Waisman, Esq., at Weil Gotshal & Manges LLP, in New York, says that LBHI and Broadway's affiliates have entered into an agreement to restructure the mezzanine loans in light of the highly distressed state of the commercial real estate markets and the related challenges confronting the properties. Mr. Waisman says that while the restructuring is complicated by the numerous interests and parties involved, its essence is: (1) forbearance of the mezzanine loans effectively extending the mezzanine loans to June 11, 2012; (2) $20 million pay down to LBHI of the $321,984,921; (3) foreclosure or assignment in lieu thereof of a $20 million portion of the $137,627,670 that will give LBHI effective control of the properties; (4) splitting of each of the mezzanine loans into two separate loans secured by separate pools; (5) contribution of capital by the Broadway Funds to accomplish the $20 million pay down and a commitment to provide working capital of up to an additional aggregate amount of $17 million, inclusive of current and future capital commitments, for the properties; and (6) the granting of an economic participation interest in the mezzanine loans to the Broadway Funds in exchange for the contributions. To obtain the control of the properties, LBHI will foreclose upon or take an assignment in lieu of a portion of the collateral for the $137,627,670. The collateral which will be foreclosed or conveyed, in lieu thereof, is the managing member interest in the borrowers of the $321,984,921, and the loan amount attributed to the foreclosed interest is $20 million. Other than the $20 million portion of the $137,627,670, the entire outstanding principal balance of both mezzanine loans will remain outstanding. Currently both of the mezzanine loans are secured by all of the properties. In connection with the restructuring of the mezzanine loans, each loan will be divided into two separate loans which will be indirectly secured by properties in Massachusetts, New York, Virginia, and California. The economics that the Broadway Funds will receive with respect to each pool is in part based on the characteristics of each pool and the working capital contributed or committed to each pool by the Broadway Funds. In structuring the pools and respective participation interests with the Broadway Funds, the Debtors sought to maximize potential recoveries for their estates from the assets with positive cash flow while utilizing capital contributions from the Broadway funds to support the capital needs of the assets and minimizing the need for the Debtors to contribute new capital on the properties, according to Mr. Waisman. "The Debtors believe that the proposed loan restructuring is in their best interests and the Debtors seek approval to enter into this restructuring with the borrowers, the Broadway Funds and certain of their affiliates," Mr. Waisman says. Terms of the Transaction Under the agreement, the Debtors have proposed to restructure the obligations under the mezzanine loans in accordance with these terms: (1) The Broadway Funds will provide an estimated $26 million in cash at closing. (2) The Broadway Funds will be responsible for all transfer taxes associated with the Pool I and Pool II properties transaction; and all amounts owing directly or indirectly by borrowers or their subsidiaries that own a direct or indirect interest in the properties to any party. (3) At closing, $20 million of the $26 million cash provided by the Broadway Funds, will be applied to pay down the mezzanine loans. (4) The Broadway Funds will provide additional callable capital of $14 million. (5) Except with respect to 120 Howard, the Broadway Funds will pay any and all shortfalls in the debt service payments due and payable under the senior loans on the June 2009 payment date. A full-text copy of the agreement is available without charge at: http://bankrupt.com/misc/LehmanAgreementBroadway.pdf The hearing to consider approval of the proposed restructuring of the mezzanine loans pursuant to the agreement is scheduled for June 24, 2009. Creditors and other concerned parties have until June 19 to file their objections. Lehman Brothers' Collapse Founded in 1850, Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States, offering a full array of financial services in equity and fixed income sales, trading and research, investment banking, asset management, private investment management and private equity. Its worldwide headquarters in New York and regional headquarters in London and Tokyo are complemented by a network of offices in North America, Europe, the Middle East, Latin America and the Asia Pacific region. Lehman filed for Chapter 11 on September 15, 2008 (Bankr. S.D. N.Y. Case No. 08-13555) after Barclays PLC and Bank of America Corp. backed out of a deal to acquire the company, and the U.S. Treasury refused to provide financial support that would have eased out a sale. Lehman's bankruptcy petition listed $639 billion in assets and $613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several affiliates filed bankruptcy petitions thereafter. On September 19, 2008, Lehman Brothers, Inc., was placed in liquidation pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119). James W. Giddens was appointed trustee for the SIPA liquidation of the business of LBI. Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed a petition under Chapter 15 of the U.S. Bankruptcy Code on February 10, 2009. Lehman Brothers Finance, a subsidiary of Lehman Brothers Inc., estimated both its assets and liabilities at more than $1 billion. LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, has been placed into administration, together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to wind down the business of LBI (Europe) on September 15, 2008. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. The two units have combined liabilities of JPY4 trillion -- US$38 billion. Akio Katsuragi, a former Morgan Stanley executive, runs Lehman's Japan units. Lehman Brothers Asia Limited, Lehman Brothers Securities Asia Limited and Lehman Brothers Futures Asia Limited suspended operations upon the bankruptcy filing of their U.S. counterparts. Asset Sales Barclays Bank Plc has acquired Lehman's North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, on September 22 reached an agreement to purchased Lehman Brothers Holdings, Inc.'s operations in Europe and the Middle East less than 24 hours after it reached a deal to buy Lehman's operations in the Asia Pacific for US$225 million. Nomura paid only US$2 dollars for Lehman's investment banking and equities businesses in Europe, but agreed to retain most of Lehman's employees. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Seeks Court Okay to Pay Unit's Loan to Fortress ---------------------------------------------------------------- Lehman Brothers Holdings Inc. and its affiliated debtors seek permission from the U.S. Bankruptcy Court for the Southern District of New York to pay the loan that Fortress Credit Corp. provided to LB Carillon Construction LLC, a non-debtor subsidiary of LBHI. LB Carillon borrowed more than $238.8 million to fund a portion of the $418 million that it loaned off to Carillon South Joint Venture LLC and North Carillon LLC in 2006. The $418 million was used to fund the construction of a residential condominium project known as Canyon Ranch Living Miami Beach Condominiums in Miami Beach, Florida. As much as $219,186,000 in construction loan was provided to Carillon South while $199,505,000 was provided to the other company. The construction loans are secured by a first lien mortgage on the southern and northern portions of the condominium while the $238.8 million is secured by LB Carillon's interests in the constructions loans. LB Carillon intended to pay the $238.8 million from the amounts paid by Carillon South and North Carillon, however, due to difficulties in the south Florida residential real estate market, the borrowers could not pay their construction loans on time, according to Shai Waisman, Esq., at Weil Gotshal & Manges LLP, in New York. LB Carillon's loan from Fortress had an initial maturity date of April 30, 2009, but Fortress has extended it to June 30, 2009. In exchange for the extension, LBHI paid Fortress about $10 million on June 1 for the benefit of LB Carillon. Upon maturity, additional amounts of less than $142 million will become due and owing to Fortress. "As part of a larger business plan with respect to Canyon Ranch, the Debtors have determined it is in the best interest of their estates to pay Fortress the amounts due," Mr. Waisman says. He adds that LBHI will make the payment and, in exchange, LB Carillon will provide LBHI with the so-called "secured market rate note" in accordance with the Court's cash management order. Pursuant to the cash management order, the Debtors can transfer cash for the benefit of a non-debtor affiliate so long as they obtain from that affiliate a note accruing interest at a market rate and a valid perfected lien junior to any existing liens of the affiliate. "The Debtors believe that the construction loans continue to have value, and consequently, the Debtors and their estates will ultimately realize a recovery on the amounts lent under the construction loans," Mr. Waisman says. He adds that the payment to Fortress will protect LB Carillon's interest in the construction loans by preventing Fortress from foreclosing its collateral. A hearing to consider approval of the Debtors' request is scheduled for June 24. Creditors and other concerned parties have until June 19 to file their objections. Lehman Brothers' Collapse Founded in 1850, Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States, offering a full array of financial services in equity and fixed income sales, trading and research, investment banking, asset management, private investment management and private equity. Its worldwide headquarters in New York and regional headquarters in London and Tokyo are complemented by a network of offices in North America, Europe, the Middle East, Latin America and the Asia Pacific region. Lehman filed for Chapter 11 on September 15, 2008 (Bankr. S.D. N.Y. Case No. 08-13555) after Barclays PLC and Bank of America Corp. backed out of a deal to acquire the company, and the U.S. Treasury refused to provide financial support that would have eased out a sale. Lehman's bankruptcy petition listed $639 billion in assets and $613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several affiliates filed bankruptcy petitions thereafter. On September 19, 2008, Lehman Brothers, Inc., was placed in liquidation pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119). James W. Giddens was appointed trustee for the SIPA liquidation of the business of LBI. Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed a petition under Chapter 15 of the U.S. Bankruptcy Code on February 10, 2009. Lehman Brothers Finance, a subsidiary of Lehman Brothers Inc., estimated both its assets and liabilities at more than $1 billion. LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, has been placed into administration, together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to wind down the business of LBI (Europe) on September 15, 2008. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. The two units have combined liabilities of JPY4 trillion -- US$38 billion. Akio Katsuragi, a former Morgan Stanley executive, runs Lehman's Japan units. Lehman Brothers Asia Limited, Lehman Brothers Securities Asia Limited and Lehman Brothers Futures Asia Limited suspended operations upon the bankruptcy filing of their U.S. counterparts. Asset Sales Barclays Bank Plc has acquired Lehman's North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, on September 22 reached an agreement to purchased Lehman Brothers Holdings, Inc.'s operations in Europe and the Middle East less than 24 hours after it reached a deal to buy Lehman's operations in the Asia Pacific for US$225 million. Nomura paid only US$2 dollars for Lehman's investment banking and equities businesses in Europe, but agreed to retain most of Lehman's employees. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wants to Buy Furniture & Equipment From Barclays ----------------------------------------------------------------- Lehman Brothers Holdings Inc. seeks permission from the U.S. Bankruptcy Court for the Southern District of New York to repurchase office furniture and equipment from Barclays Capital Inc. The office furniture and equipment had previously been sold to Barclays Capital as part of the U.K. bank's acquisition of LBHI's Northern American business. The items are located in LBHI's leased office in New York. Shai Waisman, Esq., at Weil Gotshal & Manges LLP, in New York, says LBHI intends to purchase the items as part of a larger transaction that would allow a reduction of its rent by more than $300 million. LBHI is currently in talks with Historic TW Inc. for a new sublease that would provide for less space, a shorter term, and a reduction in total rent from about $326 million to about $21 million. As a condition, LBHI has to abandon to Historic TW certain furniture and equipment located in LBHI's New York office that had been sold to Barclays Capital. Historic TW, however, would still allow LBHI to use the furniture and equipment for the investment bank's operations. LBHI has already reached an agreement with Barclays Capital to purchase the items for $5,900,001, according to Mr. Waisman. A hearing to consider approval of LBHI's request is scheduled for June 24. Creditors and other concerned parties have until June 19 to file their objections. Lehman Brothers' Collapse Founded in 1850, Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States, offering a full array of financial services in equity and fixed income sales, trading and research, investment banking, asset management, private investment management and private equity. Its worldwide headquarters in New York and regional headquarters in London and Tokyo are complemented by a network of offices in North America, Europe, the Middle East, Latin America and the Asia Pacific region. Lehman filed for Chapter 11 on September 15, 2008 (Bankr. S.D. N.Y. Case No. 08-13555) after Barclays PLC and Bank of America Corp. backed out of a deal to acquire the company, and the U.S. Treasury refused to provide financial support that would have eased out a sale. Lehman's bankruptcy petition listed $639 billion in assets and $613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several affiliates filed bankruptcy petitions thereafter. On September 19, 2008, Lehman Brothers, Inc., was placed in liquidation pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119). James W. Giddens was appointed trustee for the SIPA liquidation of the business of LBI. Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed a petition under Chapter 15 of the U.S. Bankruptcy Code on February 10, 2009. Lehman Brothers Finance, a subsidiary of Lehman Brothers Inc., estimated both its assets and liabilities at more than $1 billion. LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, has been placed into administration, together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to wind down the business of LBI (Europe) on September 15, 2008. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. The two units have combined liabilities of JPY4 trillion -- US$38 billion. Akio Katsuragi, a former Morgan Stanley executive, runs Lehman's Japan units. Lehman Brothers Asia Limited, Lehman Brothers Securities Asia Limited and Lehman Brothers Futures Asia Limited suspended operations upon the bankruptcy filing of their U.S. counterparts. Asset Sales Barclays Bank Plc has acquired Lehman's North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, on September 22 reached an agreement to purchased Lehman Brothers Holdings, Inc.'s operations in Europe and the Middle East less than 24 hours after it reached a deal to buy Lehman's operations in the Asia Pacific for US$225 million. Nomura paid only US$2 dollars for Lehman's investment banking and equities businesses in Europe, but agreed to retain most of Lehman's employees. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LN ACQUISITION: Moody's Keeps Junk Rating on Senior Secured Loan ---------------------------------------------------------------- Moody's Investors Service has affirmed the corporate family rating of LN Acquisition Corp, a wholly-owned subsidiary of Lincoln Holdings Enterprises Inc., at B2 and changed the outlook to negative from stable. In addition, Moody's affirmed the probability of default rating at B2, the senior secured first lien credit facility and term loan at B1 and the senior secured second lien term loan at Caa1. The negative outlook reflects Moody's expectation that global demand for Lincoln's lubrication equipment and pumping products will remain soft and that this uncertain business environment will have an adverse impact on its sales and earnings over the next twelve months. The outlook incorporates Moody's view that continued declines in order volumes and sales may result in increased financial leverage and reduced cash flow generation which could negatively impact the rating if earnings stabilization does not occur over the next twelve months. Further, the outlook incorporates Moody's view that lower earnings levels coupled with an upcoming covenant step down in December of 2009 may tighten headroom under Lincoln's financial maintenance covenants and potentially limit effective revolver availability over the near term. These ratings were affirmed: -- B2 Corporate Family Rating; -- B2 Probability-of-default rating; -- B1 (LGD3, 34%) on the $25 million first lien revolving credit facility; -- B1 (LGD3, 34%) on the $318 million first lien term loan; and -- Caa1 (LGD5, 85%) on the $140 million second lien term loan The last rating action on Lincoln was the July 2, 2007 affirmation of the B2 corporate family rating. Lincoln is a leading manufacturer of automatic lubrication systems and manual lubrication equipment. The company recorded net sales of roughly $400 million for the twelve months ending March 31, 2009. LINCOLN HOLDINGS: S&P Downgrades Corporate Credit Rating to 'B' --------------------------------------------------------------- Standard & Poor's Ratings Services said it has lowered its ratings, including the long-term corporate credit rating, on St. Louis-based Lincoln Holdings Enterprises Inc. to 'B' from 'B+'. The outlook is negative. "The rating action reflects weak end-market conditions that appear likely to result in credit measures deteriorating beyond S&P's range of expectations," said Standard & Poor's credit analyst Helena Song. The rating action also reflects S&P's concern about the reduced headroom under covenants and the potential risk of a covenant violation, given the weakening operating environment and step-downs in covenant levels at the end of 2009. St. Louis-based Lincoln is a leading supplier of lubrication systems and related tools and equipment. The weak business risk profile reflects primarily the company's limited product offering and its participation in the niche lubrication and pumping equipment and heavy grease application markets. The company is organized into two product groups: automated lubrication systems, and lubrication tools and equipment. The company's applications serve relatively diverse customers and end markets, which include mining, agriculture, construction, general industry, heavy industry, and energy. Lincoln is fairly diversified geographically; sales to Europe and Asia-Pacific collectively account for roughly 50% of the total revenues. After two years of growth underpinned by favorable economic conditions and global expansion, the company recently started to experience a sharp downturn resulting from the softening U.S. and European economies. S&P expects Lincoln's operating margins to decline in 2009, after they had steadily improved as a result of strong end markets and cost initiatives. Lincoln has expanded plant operations in the Czech Republic, India, and China to take advantage of lower-cost labor. Lincoln expects to achieve additional cost savings from this initiative to partially offset lower sales. The company's financial risk profile is highly leveraged, marked by high debt balances and an aggressive financial policy. Credit measures appear likely to deteriorate meaningfully this year. At the current rating, S&P expects Lincoln to maintain debt to EBITDA of 5x to 6x. Liquidity is constrained, as the company has limited headroom under its leverage ratio covenant. Lincoln has about $20 million in cash on its balance sheet and about $20 million available under its $25 million revolving credit facility. Working capital requirements should be manageable for this year. Capital expenditures should be comparable to 2008 levels as the company continues to invest in global manufacturing plants. Maintenance capital expenditures are low. The outlook is negative. S&P could lower the ratings if the likelihood of a covenant violation increases and the likelihood of obtaining a satisfactory cure worsens, or if the company fails to meet its financial obligations. S&P could raise the ratings or revise the outlook to positive if the company appears likely to maintain sufficient headroom under its covenant requirements and its debt to EBITDA approaches 5x, the lower end of the range of S&P's current expectation at the current rating. LYONDELL CHEMICAL: Settlement Agreements with 2 Insurers Approved ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York has signed off on two settlements between a Lyondell Chemical Co. debtor and two insurers that are winding down their businesses. The settlements are related to the bankrupt chemical manufacturer's legacy lead and asbestos liabilities, Bankruptcy Law360 reports. On Tuesday, the Court approved a settlement between Debtor Millennium Petrochemicals Inc. and City General Insurance Company Limited dated June 2, 2009. Pursuant to the settlement, Millennium Petrochemicals releases all rights under 8 excess insurance in exchange for a payment by City General, the details of which were permitted by the Court to be filed under seal. The subject general liability insurance policies provide Millennium Petrochemicals with insurance coverage for certain tort-like claims filed against it and its predecessors between October 1, 1957, and October 1, 1963. On the same day, the Court also approved the settlement between Debtor Millennium Holdings LLC and Reliance National Insurance Company (Europe) Limited dated June 1, 2009, the terms of which are reflected in an offer letter annexed to the Motion. Pursuant to the settlement, Millennium Holdings releases all rights under 9 excess insurance policies in exchange for a payment by Reliance. The policies, which provide coverage for certain tort-like claims, were issued to Hanson Trust LLC during the period from October 1, 1991, and October 1, 1996, and covered all of Hanson's subsidiaries and associated companies. Millennium Holdings' predecessors were subsidiaries of Hanson during this time period and were therefore covered by the Reliance policies. On May 13, 2009, the parties reached an agreement resolving Millennium Holdings' claim. The details of the settlement agreement were filed under seal upon orders of the Court. About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. It is the global leader in polyolefins technology, production and marketing; a pioneer in propylene oxide and derivatives; and a significant producer of fuels and refined products, including biofuels. Through research and development, LyondellBasell develops innovative materials and technologies that deliver exceptional customer value and products that improve quality of life for people around the world. Headquartered in The Netherlands, LyondellBasell -- http://www.lyondellbasell.com/-- is privately owned by Access Industries. Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. On January 6, 2009, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D. N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc. filed for Chapter 11. In May 2009, one of the cases was dismissed -- Case No. 09-10068 -- because it is duplicative of Case No. 09- 10040 relating to Debtor Glidden Latin America Holdings. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Lyondell has obtained approximately $8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a $6.5 billion term loan, which comprises a $3.25 billion in new loans and a $3.25 billion roll-up of existing loans; and a $1.57 billion asset-backed lending facility. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009, in order to seek protection against claims by certain financial and U.S. trade creditors. On May 8, 2009, LyondellBasell Industries added 13 non-operating entities to Lyondell Chemical Company's reorganization filing under Chapter 11 of the U.S. Bankruptcy Code. All of the entities are U.S. companies and were added to the original Chapter 11 filing for administrative purposes. The filings will have no impact on current business or operations as none of the entities manufactures or sells products. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) MANSOUR TAEED: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Mansour Taeed Afsaneh Taeed 540 Grizzly Peak Blvd. Berkeley, CA 94708 Bankruptcy Case No.: 09-45073 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Northern District of California (Oakland) Judge: Leslie J. Tchaikovsky Debtors' Counsel: Stephen D. Finestone, Esq. Law Offices of Stephen D. Finestone 456 Montgomery St. 20th Fl. San Francisco, CA 94104 Tel: (415) 421-2624 Email: sfinestone@pobox.com Total Assets: $3,301,131 Total Debts: $3,226,787 A full-text copy of the Debtors' petition, including a list of their 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/canb09-45073.pdf The petition was signed by the Joint Debtors. MARYANN MCLEOD: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Maryann McLeod Crush 948 East Broadway South Boston, MA 02127 Bankruptcy Case No.: 09-15351 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court District of Massachusetts (Boston) Judge: Frank J. Bailey Debtor's Counsel: Stephen E. Shamban, Esq. Stephen E. Shamban Law Offices, P.C. 222 Forbes Road, Suite 208 P.O. Box 850973 Braintree, MA 02185-0973 Tel: (781) 849-1136 Email: sshamban@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Ms. Crush. METALDYNE CORP: Can Hire BMC Group as Claims and Noticing Agent --------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York authorized Metaldyne Corporation and its debtor-affiliates to employ BMC Group, Inc., as its claims and noticing agent. As claims and noticing agent to the Debtors, BMC is expected to, among other things: a) perform certain claims, noticing and other administrative functions in the Chapter 11 cases; b) assist the Debtors with all analyses and collections of avoidance actions; and c) at the close of the Chapter 11 cases, box and transport all original documents in proper format, as provided by the Clerk's Office, to the Federal Archives. The hourly rates of BMC personnel are: Seniors/Principal $205 - $295 Consultants $110 - $185 Case Admin Managers $95 Data Entry/Clerical $45 To the best of the Debtors' knowledge, BMC is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About Metaldyne Corporation Headquartered in Plymouth, Michigan, Metaldyne Corporation -- http://www.metaldyne.com/-- is a wholly owned subsidiary of Asahi Tec, a Shizuoka, Japanbased chassis and powertrain component supplier in the passenger car/light truck and medium/heavy truck segments. Asahi Tec is listed on the Tokyo Stock Exchange. Metaldyne is a leading global designer and supplier of metal based components, assemblies and modules for transportation related powertrain and chassis applications including engine, transmission/transfer case, wheel end, and suspension, axle and driveline, and noise and vibration control products to the motor vehicle industry. On January 11, 2007, in connection with a plan of merger, Asahi Tee Corporation in Japan acquired the shares of Metaldyne. On the same date, Asahi Tee contributed those shares to Metaldyne Holdings, and Asahi Tee thereby became the indirect parent of Metaldyne and its other units. RHJ International S.A. of Belgium now holds approximately 60.1% of the outstanding capital stock of Asahi Tec. The Company own 23 different properties, including 14 domestic manufacturing facilities in six states, and more than 10 manufacturing facilities North America, Europe, South America and Asia. For the fiscal year ended March 29, 2009, the company recorded annual revenues of approximately $1.32 billion. As of March 29, 2009, utilizing book values, the company had assets of approximately $977 million and liabilities of $927 million. Metaldyne Corporation aka MascoTech, Inc., aka MascoTech Harbor, Inc., Riverside Acquisition Corporation and Metaldyne Subsidiary Inc. and its affiliates filed for Chapter 11 on May 27, 2009 (Bankr. S. D. NY Lead Case No. 09-13412). Richard H. Engman, Esq., at Jones Day represents the Debtors in their restructuring efforts. The Debtors propose to hire Judy A. O'Neill, Esq., at Foley & Lardner LLP as conflicts counsel; Lazard Freres & Co. LLC and AlixPartners LLP as financial advisors; and BMC Group Inc. as claims agent. The Debtors have assets and debts both ranging from $500 million to $100 million. MOHAWK TRAVELER: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Mohawk Traveler Transportation, LLC 211 Bridge Rd. Houma, LA 70363 Bankruptcy Case No.: 09-11712 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Eastern District of Louisiana (New Orleans) Judge: Jerry A. Brown Debtor's Counsel: Bernard H. Berins, Esq. Heller Draper Hayden Patrick & Horn LLC 650 Poydras Street, Suite 2500 New Orleans, LA 70130 Tel: (504) 299-3300 Fax: (504) 299-3399 Email: bberins@hellerdraper.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 6 largest unsecured creditors is available for free at http://bankrupt.com/misc/laeb09-11712.pdf The petition was signed by Larry Fitch, sole member of the Company. NA-MOR INC.: Case Summary & 11 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Na-Mor, Inc. aka Na-Mor Countryside 1915 NE 45th Street, Suite 101 Ft. Lauderdale, FL 33308 Bankruptcy Case No.: 09-21515 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Judge: John K. Olson Debtor's Counsel: Kevin C. Gleason, Esq. 4121 N 31 Ave. Hollywood, FL 33021 Tel: (954) 893-7670 Email: kgpaecmf@aol.com Total Assets: $1,995,249 Total Debts: $1,550,942 A full-text copy of the Debtor's petition, including a list of its 11 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flsb09-21515.pdf The petition was signed by Christopher Farah, officer of the Company. NANOGEN INC: Wants Morgan Lewis as Special Bankruptcy Counsel -------------------------------------------------------------- Nanogen, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware for authority to employ Morgan, Lewis & Bockius LLP as their special counsel. As special counsel to the Debtors, Morgan Lewis will, among other things: a) assist the Debtors' general bankruptcy counsel in connection with the preparation and filing of the Debtors' bankruptcy petitions, schedules and related documents; b) advise and represent the Debtors with respect to all corporate and securities matters arising during the pendency of the Chapter 11 cases; and c) advise and represent the Debtors with respect to certain intellectual property matters arising during the pendency of the Chapter 11 cases. The Debtors relate that Morgan Lewis' services will not be duplicative of the services rendered by other professionals in the Chapter 11 cases. The hourly rates of Morgan Lewis' personnel are: William A. Myers, partner $595 Scott D. Karchmer, partner $590 J. Taylor Browning, associate $550 Albert Lung, associate $505 Carolyn Mo, associate $395 Julie L. Davies, associate $340 Scott M. Berning, associate $340 Other professionals may also provide services and their hourly rates are: Partners $485 to $1,050 Associates $250 to $565 Legal Assistants $190 to $360 Mr. Karchmer tells the Court that before the Debtors filed for bankruptcy, Morgan Lewis received $1,625,830 for services rendered and expenses incurred in connection with its professional services. Mr. Karchmer adds that prior to the petition date, Morgan Lewis received a $125,000 retainer, which was applied against prepetition fees and expenses and replenished at various times. The Debtors owe Morgan Lewis $324,000, consisting of $311,000 billed and $13,000 unbilled prepetition fees and expenses. Mr. Karchmer assures the Court that Morgan Lewis is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Karchmer can be reached at: Morgan, Lewis & Bockius LLP One Market, Spear Street Tower San Francisco, CA 94105-1596 Tel: (415) 442-1091 Fax: (415) 442-1001 About Nanogen, Inc. Headquartered in San Diego, California, Nanogen, Inc. is a manufacturer of advanced human diagnostic products. The Company and its affiliates filed for Chapter 11 on May 13, 2009 (Bankr. D. Del. Lead Case No. 09-11696). Karen B. Skomorucha, Esq., Ricardo Palacio, Esq., and William Pierce Bowden, Esq., at Ashby & Geddes, P.A., represent the Debtors in their restructuring efforts. The Debtors have assets and debts both ranging from $10 million to $50 million. NANOGEN INC: Wants More Time to File SALs & SOFAs Thru July 13 -------------------------------------------------------------- Nanogen, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware to extend until July 13, 2009, the time by which they must file schedules of assets and liabilities and statements of financial affairs. The Debtors assert that they need additional time to complete and file the Schedules. The Debtors maintain that the extension will not prejudice the rights of other claimants and parties-in- interest. Headquartered in San Diego, California, Nanogen, Inc. is a manufacturer of advanced human diagnostic products. The Company and its affiliates filed for Chapter 11 on May 13, 2009 (Bankr. D. Del. Lead Case No. 09-11696). Karen B. Skomorucha, Esq., Ricardo Palacio, Esq., and William Pierce Bowden, Esq., at Ashby & Geddes, P.A., represent the Debtors in their restructuring efforts. The Debtors have assets and debts both ranging from $10 million to $50 million. NAVISTAR INT'L: Reports $12 Million Profit in Second Quarter ------------------------------------------------------------ Navistar International Corporation reported second quarter profits of $12 million, equal to $0.16 per diluted share, on $2.8 billion in net sales and revenues. Although the industry outlook remains challenging, Navistar has taken actions to help mitigate the adverse effects on its profitable growth, sustaining its momentum to deliver another year of expected net income. The results for the second quarter ended April 30, 2009 were impacted by weak industry sales in every part of Navistar's commercial business, as compared to the year-ago second quarter. Second quarter earnings were reduced by $31 million, equal to $0.44 per diluted share, from other costs related to the Ford settlement. In addition in the latest period, the company incurred research and development costs, and unanticipated costs related to warranty on products sold in prior periods, partially offset by the benefits from certain out-of-period accounting adjustments. In the second quarter a year ago, Navistar reported net income of $211 million, equal to $2.88 per diluted share, on $3.9 billion in net sales and revenues. "Although the current growth of our traditional businesses is hamstrung by the global recession, we have nonetheless been able to advance numerous strategic and tactical initiatives that will be key contributors to our future success," said Daniel C. Ustian, Navistar chairman, president and chief executive officer. For the first six months of fiscal 2009, Navistar reported net income of $246 million, equal to $3.44 per diluted share, including the positive effect from the settlement with Ford of $155 million, equal to $2.17 per diluted share, compared with $146 million, equal to $2 per diluted share, in the first six months a year ago. First half net sales and revenues amounted to $5.8 billion, compared with $6.9 billion in the year-ago period. "Continued reductions in our product costs, lower selling, general and administrative expenses and increased market share growth, along with the company's military business, will enable us to maintain pace toward a profitable fiscal 2009 despite three consecutive years of dwindling truck volumes," said Mr. Ustian. The company now projects that total truck industry retail sales volume for Class 6-8 trucks and school buses in the United States and Canada for the fiscal year ending October 31, 2009, will total between 165,000 and 185,000 units, down from the previous forecast of 210,000 to 225,000 units. Industry volumes reached a recent high of 454,700 units in 2006 due to accelerated purchases of trucks in anticipation of higher prices due to stricter emissions standards imposed by the Environmental Protection Agency in 2007. However, the industry is anticipating only a minimal pre-buy in 2009 ahead of 2010 emissions requirements. Based on second quarter results and company forecasts for the remainder of the year, Navistar reported guidance for net income for its fiscal year ending October 31, 2009, in the range of $200 million, or $2.80 per diluted share, to $225 million, or $3.10 per diluted share, excluding the Ford settlement and related charges. Including results of the Ford settlement, per diluted share earnings should be in the range of $5.20 to $5.50 per diluted share. "It is now clear that the economic recovery will take longer than had been originally expected. We are addressing this likelihood straight on by maintaining focus on our core product and market initiatives while taking the necessary steps that will allow us to adapt to the rapidly changing marketplace," said Mr. Ustian. In addition, the company has made significant reductions to its overall selling, general and administrative expenses to optimize the performance of its business in the most challenging economic conditions in more than 45 years. These overall efforts are expected to yield improvements to the company's bottom line. Manufacturing segment profit was $87 million and $494 million, including the impacts of the Ford settlement and other related costs, for the second quarter and first half of 2009, respectively, compared with $316 million and $408 million in the year-ago periods. A full-text copy of the company's second quarter financial results is available for free at http://ResearchArchives.com/t/s?3dc3 About Navistar International Based in Warrenville, Illinois, Navistar International Corporation (NYSE: NAV) -- http://www.navistar.com/-- produces International(R) brand commercial and military vehicles, MaxxForce(TM) brand diesel engines, IC brand school and commercial buses, and Workhorse(R) brand chassis for motor homes and step vans, and is a private label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. Navistar is also a provider of truck and diesel engine parts. Another affiliate offers financing services. Navistar reported $9.62 billion in total assets and $11.09 billion in total liabilities as of January 31, 2009, resulting in $1.49 billion in stockholders' deficit. * * * According to the Troubled Company Reporter on April 15, 2009, Fitch Ratings has affirmed the Issuer Default Ratings of Navistar International Corporation and Navistar Financial Corp. at 'BB-', the Rating Outlook remains Negative. The ratings cover approximately $1.8 billion of debt at NAV and $3.2 billion debt at NFC as of January 31, 2009. NEW YORK TIMES: Goldman Hints Start of Offer Acceptance ------------------------------------------------------- Goldman Sachs & Co. signaled prospective buyers that it would start entertaining offers for any or all of the New York Times Co.'s assets, including the Boston Globe, Russell Adams at The Wall Street Journal reports, citing people familiar with the matter. Goldman Sachs, WSJ relates, was already taking bids on Times Co.'s almost 18% stake in the holding company of the Boston Red Sox baseball team. WSJ states that the Boston Globe newspaper could be sold as the Times Co. struggles with declining revenue and heavy debt. According to WSJ, the Boston Globe's largest union, the Boston Newspaper Guild, rejected this week concessions that Times Co. said were necessary to save the paper. WSJ reports that Times Co. said that it would impose a 23% wage cut to achieve the $10 million in concessions it was seeking from the Boston Newspaper. WSJ notes that the wage reduction is a significant compromise for the Times Co. WSJ relates that the Times Co.'s proposal included a pension freeze and the elimination of job guarantees for some 190 Guild members, on top of a wage reduction of 8.4%. According to WSJ, people who have expressed interest in the Boston Globe said that the newspaper will have to shrink before they would consider taking it on. Citing analysts, WSJ says that the Boston Globe has significant pension liabilities and no longer sells enough ads to support its staff. The Times Co. expects that the newspaper would post an operating loss of $85 million in 2009, the report states. WSJ quoted Fitch Ratings analyst Mike Simonton as saying, "We'd anticipate without the concessions, there would be few if any suitors for a newspaper that loses more than $50 million a year and has an uncooperative union work force." About The New York Times The New York Times Co., a leading media company with 2008 revenues of $2.9 billion, includes The New York Times, the International Herald Tribune, The Boston Globe, 16 other daily newspapers, WQXR- FM and more than 50 Web sites, including NYTimes.com, Boston.com and About.com. The Company was founded in 1896. * * * As reported in the Troubled Company Reporter on December 4, 2008, the NY Times cut its quarterly dividend by 74%, as part of an effort to conserve cash. The NY Times said that it took steps to lower debt and increase liquidity, including reevaluating its assets. The NY Times has laid off employees, merged sections of the NY Times and Globe to reduce printing costs, and consolidated New York area printing plants this year. The TCR reported on May 25, 2009, that Standard & Poor's Ratings Services lowered its corporate credit and senior unsecured issue- level ratings on New York City-based newspaper publisher The New York Times Co. to 'B' from 'B+'. These ratings were removed from CreditWatch, where they were placed with negative implications April 22, 2009. The rating outlook is stable. According to the TCR on April 28, 2009, Moody's Investors Service downgraded The New York Times Company's Corporate Family Rating and Probability of Default ratings to B1 from Ba3 and ratings on the senior unsecured notes to B1 from Ba3. The Company's speculative grade liquidity rating remains SGL-3 and the rating outlook is negative. OUTDOOR RV: Hires Levy Law Firm as Bankruptcy Counsel ----------------------------------------------------- The U.S. Bankruptcy Court for the District of South Carolina authorized Outdoor RV and Marine, LLC, to employ Levy Law Firm, LLC, as its counsel. Among other things, Levy is expected to: a) provide the Debtor legal advice with respect to its powers and duties as debtor in the management and disposition of its property; b) prepare on Debtor's behalf applications, motions, pleadings, objections, memoranda, briefs, orders, reports and other legal papers as may be necessary or appropriate in this case; c) provide legal advice and assistance in the development of a Plan of Reorganization, a disclosure statement, and other pleadings and documents relating to the disposition of assets and the payment and treatment of claims against the bankruptcy estate; and d) provide legal advice on various other matters that may arise in this case. The hourly rates of Levy personnel are: R. Geoffrey Levy, member $375 Susan M. Levy, attorney $250 Robin C. Osborne,paralegal $120 Brien P. Levy, paralegal $100 Mr. Levy told the Court that the firm received a $50,000 initial retainer for prepetition and postpetition costs and services. Mr. Levy assured the Court that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Levy Law Firm LLC 2300 Wayne Street Columbia, SC 29201 Tel: (803) 256-4693 About Outdoor RV and Marine, LLC Columbia, South Carolina-based Outdoor RV and Marine, LLC sells recreational vehicles and boats. The Company filed for Chapter 11 on May 15, 2009 (Bankr. D. S.C. Case No. 09-03719). The Debtor did not file a list of 20 largest unsecured creditors. The Debtor has assets and debts both ranging from $10 million to $50 million. OUTDOOR RV: Has until June 15 to File Schedules and Statements -------------------------------------------------------------- The U.S. Bankruptcy Court for the District of South Carolina extended the time by which Outdoor RV and Marine, LLC must file its schedules of assets and liabilities and statements of financial affairs through June 15, 2009. Columbia, South Carolina-based Outdoor RV and Marine, LLC sells recreational vehicles and boats. The Company filed for Chapter 11 on May 15, 2009 (Bankr. D. S.C. Case No. 09-03719). R. Geoffrey Levy, Esq., at Levy Law Firm LLC represents the Debtor in its restructuring efforts. The Debtor did not file a list of 20 largest unsecured creditors. The Debtor has assets and debts both ranging from $10 million to $50 million. OUTDOOR RV: Taps Harry Swagart to Handle SC Motor Vehicle Matters ----------------------------------------------------------------- The U.S. Bankruptcy Court for the District of South Carolina authorized Outdoor RV and Marine, LLC, to employ Harry A. Swagart, III, PC, as its special counsel. The firm is expected to advise the Debtor on matters pertaining to the South Carolina Department of Motor Vehicles and related matters. The hourly rates of the firm's personnel are: Harry A. Swagart, III $250 Stacey Mckinney, Paralegal $65 Mr. Swagart assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Swagart can be reached at: Harry A. Swagart, III, PC 1722 Main Street, Suite 220 Columbia, SC 29201 Tel: (803) 779-0770 About Outdoor RV and Marine, LLC Columbia, South Carolina-based Outdoor RV and Marine, LLC sells recreational vehicles and boats. The Company filed for Chapter 11 on May 15, 2009 (Bankr. D. S.C. Case No. 09-03719). R. Geoffrey Levy, Esq., at Levy Law Firm LLC represents the Debtor in its restructuring efforts. The Debtor did not file a list of 20 largest unsecured creditors. The Debtor has assets and debts both ranging from $10 million to $50 million. P&R REALTY: Voluntary Chapter 11 Case Summary --------------------------------------------- Debtor: P&R Realty, Inc. 286 Beverly Drive NE Concord, NC 28025 Bankruptcy Case No.: 09-51162 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Middle District of North Carolina (Winston-Salem) Debtor's Counsel: Brian Hayes, Esq. P. O. Box 444 Concord, NC 28026-0444 Tel: (704) 788-3211 Email: bphafd@fspa.net Total Assets: $1,500,000 Total Debts: $621,847 The Company says it does not have unsecured creditors who are non-insider when they filed their petition. The petition was signed by Neva Jo Roberts, president of the Company. PACIFIC ETHANOL: Wants to Tap Cooley Godward as Bankruptcy Counsel ------------------------------------------------------------------ Pacific Ethanol Holding Co. LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the District of Delaware for authority to employ Cooley Godward Kronish LLP as its counsel. Cooley will, among other things: a) advise the Debtors with respect to their powers and duties as debtors and debtors-in-possession in the continued management and operation of their businesses and properties; b) attend meetings and negotiate with representative of creditors and other parties-in-interest and advise and consult on the conduct of the Chapter 11 cases, including all of the legal and administrative requirements of operating in Chapter 11; and c) take all necessary action to protect and preserve the Debtors' assets, including the prosecution of actions on their behalf, the defense of any actions commenced against those estates, negotiate concerning litigation in which the Debtors may be involved, and objections to claims filed against those estates. Lawrence C. Gottlieb, Esq., a member of Cooley, tells the Court that pre-bankruptcy, Cooley received $1,140,000 on account of fees and expenses incurred from May 1, 2008, to May 17, 2009. Cooley received a $380,000 retainer to pay fees and disbursements which may remain unpaid during the course of the Chapter 11 cases. The hourly rates of Cooley's personnel are: Partners $705 - $880 Associates and Paralegals $225 - $390 Mr. Gottlieb assures the Court that Cooley is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Mr. Gottlieb can be reached at: Cooley Godward Kronish LLP 1114 Avenue of the Americas New York, NY 10036 Tel: (212) 479-6000 Fax: (212) 479-6275 About Pacific Ethanol Holding Headquartered in Sacramento, California, Pacific Ethanol Holding Co. LLC -- http://www.pacificethanol.net/-- produces and sells ethanol. The Debtors are affiliates of Pacific Ethanol Inc. The Company and its affiliates filed for Chapter 11 on May 17, 2009 (Bankr. D. Del. Lead Case No. 09-11713). Lawrence C. Gottlieb, Esq., and Richard S. Kanowitz, Esq., at Cooley Godward Kronish LLP represent the Debtors in their restructuring effort. The Debtors propose to hire Steven M. Yoder, Esq., at Potter Anderson & Corroon LLP as co-counsel and Epiq Bankruptcy Solutions LLC as claims and noticing agent. The Debtors listed $50 million to $100 million in assets and $100 million to $500 million in debts. PAMELA ELLEN: Case Summary & 3 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Pamela Ellen McAteer 125 South Winchester Rd. Annapolis, MD 21409 Bankruptcy Case No.: 09-20524 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court District of Maryland (Baltimore) Judge: Duncan W. Keir Debtor's Counsel: Joel I. Sher, Esq. Shapiro Sher Guinot & Sandler 36 S. Charles Street, Suite 2000 Baltimore, MD 21201 Tel: (410) 385-4278 Fax: (410) 539-7611 Email: bankruptcy@shapirosher.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 3 largest unsecured creditors is available for free at: http://bankrupt.com/misc/mdb09-20524.pdf The petition was signed by Tammy Straughn, president of the Company. PARKSIDE VILLAGE: Case Summary & Largest Unsecured Creditor ----------------------------------------------------------- Debtor: Parkside Village LLC PO Box 690 Woodstock, VA 22664 Bankruptcy Case No.: 09-50909 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Western District of Virginia (Harrisonburg) Judge: Chief Judge Ross W. Krumm Debtor's Counsel: Timothy J. McGary, Esq. 10500 Sager Ave., Suite G Fairfax, VA 22030 Tel: (703) 352-4985 Email: tjm@mcgary.com Total Assets: $1,907,256 Total Debts: $1,552,136 A full-text copy of the Debtor's petition, including the identity of its largest unsecured creditor, is available for free at: http://bankrupt.com/misc/vawb09-50909.pdf The petition was signed by Randolph K. Carter, managing member of the Company. PHOENIX ASSOCIATES: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Phoenix Associates Land Syndicate dba Murphy Sand and Gravel PO Box 100 Madisonville, LA 70447 Bankruptcy Case No.: 09-11743 Type of Business: The Debtor engages on acquisition and development of companies in the aviation, construction, mining and oil & gas industries. See http://www.pbls.biz/ Chapter 11 Petition Date: June 10, 2009 Court: Eastern District of Louisiana (New Orleans) Judge: Jerry A. Brown Debtor's Counsel: Claude C. Lightfoot, Jr., Esq. attorney@claudelightfoot.com Claude C. Lightfoot, Jr. P.C. 424 Gravier Street, Third Floor New Orleans, LA 70130 Tel: (504) 838-8571 Fax: (504) 838-8572 Estimated Assets: $50 million to $100 million Estimated Debts: $10 million to $50 million The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Harvest Group bill $2,305,002 Harvest Oil & Gas Harvest Pipeline Covington, LA 70433 Madison Realty Capital bill $2,100,000 825 Third Avenue 37th Floor New York, NY 10022 Paul & Carolyn Alonzo loan $1,710,800 2 N. Bonita Dr. Madisonville, LA 70447 Shell Trading Co. bill $1,500,000 P O Box 4604 Houston, TX 77210 Paul & Carolyn Alonzo bond $950,000 International Turf Applicators $880,000 Inc. Able Building Company bill $500,000 Celtech Corporation bill $650,000 XYZ Company bill $450,279 Destin Resources bill $443,870 Bowles Energy bill $430,741 Enbridge Marketing bill $418,260 Ann Arbor Pool Builders bill $411,734 Conn Energy bill $308,948 Energy Properties bill $284,175 Bridwell Oil Management bill $289,413 HIJ Company bill $247,367 ABC Company Noble Jet 2007 $230,502 Virgin Offshore bill $219,587 Carol Rutherford loan $150,000 The petition was signed by C. Paul Alonzo, president. PHOENIX COYOTES: Jim Balsillie Balks at $100MM Relocation Fee ------------------------------------------------------------- At a hearing Tuesday at the U.S. Bankruptcy Court for the District of Arizona, Jim Balsillie disclosed for the first time that the National Hockey League is asking him to pay a $100 million relocation fee in connection with his bid to move the Phoenix Coyotes to Hamilton, Ontario. Mr. Balsillie, one of the founders of BlackBerry inventor Research in Motion Ltd., is unwilling to pay the relocation fee, Bloomberg's Bill Rochelle reports. The current owner, Jerry Moyes, provided the team with more than $300 million until he cut off funding in November. The NHL is a creditor for $37 million. The league contends Mr. Moyes gave up control when he stopped funding losses in November, compelling the league to make advances to cover deficits. The team moved to Phoenix in 1995. As reported in the Troubled Company Reporter on June 11, 2009, The Associated Press reported that a relocation fee imposed by the National Hockey League could block Jim Balsillie's bid to purchase Phoenix Coyotes and move it to Hamilton, Ontario. According to the report, Judge Hon. Redfield T. Baum said that his reading of case law shows that the NHL owns the right to the Hamilton region and would be entitled to a fee if a team is located there. Dewey Ranch, together with affiliates Arena Management Group, LLC, Coyotes Holdings, LLC, and Coyotes Hockey, LLC, filed for Chapter 11 bankruptcy protection on May 5, 2009 (Bankr. D. Ariz. Case No. 09-09488), to implement a court-approved sale of Phoenix Coyotes under the Bankruptcy Code. The filing included a proposed sale of the franchise to PSE Sports & Entertainment, LP, which would move the franchise to southern Ontario, Canada. Thomas J. Salerno, Esq., at Squire, Sanders & Dempsey, LLP, assists the Debtors in their restructuring efforts. Dewey Ranch listed $100 million to $500 million in assets and $100 million to $500 million in debts. PHOENIX COYOTES: Court Wants to See Other Bids for Firm ------------------------------------------------------- Mike Sunnucks at Phoenix Business Journal reports that the Hon. Redfield T. Baum of the U.S. Bankruptcy Court for the District of Arizona wants to see other bids submitted for Phoenix Coyotes. According to Business Journal, the National Hockey League and city of Glendale oppose Jim Balsillie's $213 million bid for Phoenix Coyotes, but Judge Baum said that it was the only offer submitted to him. Mr. Balsillie's bid include the transfer of the Coyotes to Hamilton, Ontario. Citing the NHL, Business Journal states that four potential bidders would keep Phoenix Coyotes in Arizona. The report says that the bidders are: -- Jerry Reinsdorf, owner of baseball's Chicago White Sox and the NBA's Chicago Bulls; -- Howard Sokolowski and David Cynamon, co-owners of the Toronto Argonauts of the Canadian Football League; and -- Las Vegas-based businessman John Breslow, who now owns 3% of the Coyotes. Judge Baum said that potential bidders and interested parties do not constitute a formal offer he can consider, Business Journal relates. No formal offer from Mr. Reinsdorf or any other Arizona ownerships groups have been filed with the Court, Business Journal states, citing Judge Baum. Dewey Ranch, together with affiliates Arena Management Group, LLC, Coyotes Holdings, LLC, and Coyotes Hockey, LLC, filed for Chapter 11 bankruptcy protection on May 5, 2009 (Bankr. D. Ariz. Case No. 09-09488), to implement a court-approved sale of Phoenix Coyotes under the Bankruptcy Code. The filing included a proposed sale of the franchise to PSE Sports & Entertainment, LP, which would move the franchise to southern Ontario, Canada. Thomas J. Salerno, Esq., at Squire, Sanders & Dempsey, LLP, assists the Debtors in their restructuring efforts. Dewey Ranch listed $100 million to $500 million in assets and $100 million to $500 million in debts. POLK SOD SERVICES: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Polk Sod Services, Inc. 5880 SR 544 Winter Haven, FL 33881 Bankruptcy Case No.: 09-12177 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Judge: K. Rodney May Debtor's Counsel: Tanya M. Comparetto, Esq. 114 N. Tennessee Ave., Suite 204 Lakeland, FL 33801 Tel: (863) 686-6883 Email: tmcpa1259@cs.com Total Assets: $1,407,376 Total Debts: $449,736 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-12177.pdf The petition was signed by Curtis Pierce. POPULAR INC: S&P Downgrades Counterparty Credit Rating to 'BB-' --------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its ratings on Popular Inc., including lowering the long-term counterparty credit rating to 'BB-' from 'BB+' and the rating on the company's preferred shares to 'C' from 'B-', and affirmed the short-term counterparty credit rating at 'B'. S&P also lowered its ratings on the company's primary subsidiary, Banco Popular de Puerto Rico, to 'BB+/B' from 'BBB-/A-3'. The outlooks are negative. The rating downgrade followed management's announcement that it would suspend dividends on shares of the company's common stock and on its series A and series B preferred stock. Management also announced plans to offer common stock in exchange for its series A and series B preferred and its trust-preferred securities. "We believe that these actions reflect increasing pressures on the company's capital position, operating performance, and liquidity," said Standard & Poor's credit analyst Robert Hansen. S&P forecasts high participation in the planned exchange offer based on the proposed premium and view favorably the anticipated increase of nearly $1.2 billion in tangible common equity. However, S&P expects the bank's continued credit quality deterioration and the net losses it will likely sustain over the next several quarters to more than fully offset the positive implications from the planned exchange offer. The downgrade also reflects S&P's expectations for continued bottom-line losses stemming from increasing credit losses and the associated pressures on capital ratios. Specifically, S&P expects that nonperforming assets will continue to rise over the next several quarters, notably in the construction, mortgage, and commercial loan portfolios, as S&P sees continued weakness in home prices, reduced sale activity and continuing difficult economic conditions in Puerto Rico. The negative outlook reflects S&P's belief that the rating will remain under pressure for some time. If credit quality deteriorates beyond S&P's current expectations, S&P could lower the rating further. However, if the company returns to profitability because its credit quality improves, then S&P could raise the ratings, which S&P views as less likely given S&P's general economic outlook. PRESIDENTIAL CLUB: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Presidential Club, LLLP 19600 Presidential Way Miami, FL 33179 Bankruptcy Case No.: 09-21399 Debtor-affiliate filing separate Chapter 11 petition: Entity Case No. ------ -------- Presidential Golf Maintenance Association, Inc. 09-21402 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Southern District of Florida (Miami) Judge: Robert A. Mark Debtor's Counsel: Matthew I. Kramer, Esq. 200 S Biscayne Blvd #2500 Miami, FL 33131 Tel: (305) 350-7246 Email: mkramer@bilzin.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flsb09-21399.pdf The petition was signed by Michael Baumann, manager of the Company. PREVALENCE HEALTH: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Prevalence Health, LLC fdba Prevalence Health, LLC fdba Ted's Meds 4270 I-55 North, Suite 102 Jackson, MS 39211 Bankruptcy Case No.: 09-02016 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Southern District of Mississippi (Jackson Divisional Office) Judge: Edward Ellington Debtor's Counsel: Stephen W. Rosenblatt, Esq. Butler Snow O'Mara Stevens & Cannada PLLC Post Office Box 22567 Jackson, MS 39225-2567 Tel: (601) 985-4504 Fax: (601) 985-4500 Email: Steve.Rosenblatt@butlersnow.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/mssb09-02016.pdf The petition was signed by Michael L. Anthony, president of the Company. RICHARD MICHAEL: Case Summary & 21 Largest Unsecured Creditors -------------------------------------------------------------- Joint Debtors: Richard Michael Brady, Jr. Carol Ann Brady 21 Seaview Avenue Monmouth Beach, NJ 07750 Bankruptcy Case No.: 09-24804 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court District of New Jersey (Trenton) Debtors' Counsel: Lee D. Gottesman, Esq. 509 Main Street PO Box 1508 Toms River, NJ 08754-1508 Tel: (732) 914-1055 Email: lee@ldg-law.com Total Assets: $7,358,227 Total Debts: $5,879,236 A full-text copy of the Debtor's petition, including a list of their 21 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/njb09-24804.pdf The petition was signed by the Joint Debtors. ROGER J. ABDIN: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Roger J. Abdin 26223 N. 93 Ave Peoria, AZ 85383 Bankruptcy Case No.: 09-12848 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Debtor's Counsel: Ronald J. Ellett, Esq. Ellett Law Offices, P.C. 2999 North 44th Street, Suite 550 Phoenix, AZ 85018 Tel: (602) 235-9510 Fax: (602) 235-9098 Email: rjellett@ellettlaw.phxcoxmail.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Mr. Abdin. RUSSELL BROTHERS: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Russell Brothers 10053 Bath Road Byron, MI 48418 Bankruptcy Case No.: 09-33105 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Eastern District of Michigan (Flint) Judge: Daniel S. Opperman Debtor's Counsel: Peter T. Mooney, Esq. Simen, Figura & Parker 5206 Gateway Centre #200 Flint, MI 48507 Tel: (810) 235-9000 Email: pmooney@sfplaw.com Total Assets: $760,906 Total Debts: $1,124,694 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/mieb09-33105.pdf The petition was signed by Karl Russell, president of the Company. SEMGROUP LP: Court Permits Creditors Panel to Examine PwC, Et Al. ----------------------------------------------------------------- As reported by the Troubled Company Reporter on June 1, 2009, the Official Committee of Unsecured Creditors of SemGroup L.P., SemCrude L.P., and their debtor-affiliates renewed its motion to conduct examinations under Rule 2004 of the Federal Rules of Bankruptcy Procedure and direct production of documents to: * PricewaterhouseCoopers L.L.P., * Barclays Bank, PLC, * Hall, Estill, Hardwick, Gable, Golden & Nelson, * Ritchie Capital Management, LLC, and * Carlyle/Riverstone Global Energy and Power Fund II, L.P. PwC and Hall Estill, in separate filings, and J. Aron Company and Goldman Sachs & Co., in a joint filing, had objected to the Creditors' Committee's Rule 2004 motion. In separate filings, Thomas Kivisto and Westback Purchasing Co., LLC, join in the objection of Hall, Estill, Hardwick, Gable, Golden & Nelson, P.C., to the Official Committee of Unsecured Creditors' request to renew its Rule 2004 Motion. Mr. Kivisto and Westback complain that the Creditors' Committee seeks the production of privileged or protected documents relating to Hall Estill's representation on their behalf. Hall Estill provided legal representation to Mr. Kivisto and certain of his entities, including Westback, prior to and as of the Petition Date. In response to the Official Producers' Committee's joinder to the supplemental motion of the Creditors' Committee, Bank of America, N.A., complains that the OPC has twice sought to assert the Debtors' claims against J. Aron & Company, noting that the Court has also declined the OPC's request twice. Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, in Wilmington, Delaware, counsel to BofA, relates that the Court has twice found that the OPC's interest in the Debtors' prepetition transactions with J. Aron are identical to those of all parties with an interest in the estates, including the Creditors' Committee. Accordingly, for the same reasons that the Court refused the OPC's two previous requests -- including that requests were premature and contrary to the estates' interest -- the Court should deny the OPC's Rule 2004 joinder in regard to J. Aron and Goldman Sachs, Ms. Silverstein asserts. Creditors' Committee Responds, Producers' Committee Reacts The Creditors' Committee asserts that it has established good cause for its motion to revive its Rule 2004 Motion so that the Court should overrule the objections of PricewaterhouseCoopers, LLP, Hall Estill, J. Aron & Company, and Goldman Sachs Group. On behalf of the Creditors' Committee, Bonnie Glantz Fatell, Esq., at Blank Rome LLP, in Wilmington, Delaware, complains that PwC's objection that sought to condition its consent to the Rule 2004 upon the establishment of a document sharing protocol, is unavailing. Ms. Fatell points out that the Creditors' Committee is the only entity that has filed a Rule 2004 Motion against PwC so that PwC will be required to respond to only one set document request to in the event the motion is granted. As with Hall Estill's objection, Ms. Fatell says the Creditors' Committee has revised the document requests, as originally proposed, so that the scope, breadth and burden associated with that proposed document request should be summarily rejected as moot. As to Hall Estill's claim of privilege, the issue can be addressed through the submission of a privilege log, she says. J. Aron's and Goldman Sachs's contention that the Creditors' Committee cannot obtain discovery on account of its involvement in an adversary proceeding is contradicted by case law, Ms. Fatell contends. Courts have allowed Rule 2004 discovery despite of the existence of an adversary proceeding or a pending litigation when the scope of the requested Rule 2004 discovery is broader than the scope of the adversary case or pending litigation, or when the requesting party is unable to obtain discovery in the pending proceeding or litigation, Ms. Fatell points out. The Official Producers Committee, in a separate filing, reacts to BofA's objection to the supplemental motion compelling J. Aron and Goldman Sachs to produce certain documents, saying that BofA's objection is groundless. BofA said the OPC should not even see the documents, recounts counsel to OPC, Karen McKinley, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware. Ms. McKinley points out that while the Court denied OPC's request to file derivative claims against J. Aron, the Court did so without prejudice, directing the Debtors to keep the OPC abreast of the J. Aron investigation and litigation. The OPC is not even seeking its own 2004 examination, she emphasizes, pointing out that the OPC is simply asking the Court to be copied on documents that will be produced by J. Aron and Goldman pursuant to the Creditors' Committee's request. The OPC previously joined in the Creditors' Committee's supplemental request for J. Aron's and Goldman Sach's production of documents. Accordingly, the Committees ask the Court to rule against the objections. * * * The Court granted the Creditors' Committee's Rule 2004 Motion and directed PricewaterhouseCoopers LLP; Barclays Bank, PLC; Hall, Estill, Hardwick, Gable, Golden & Nelson; Carlyle/Riverstone Global Energy and Power Fund II, L.P., Ritchie Capital Management, LLC, to produce documents relating to their business transactions and relationships with the Debtors or the Debtors' representatives. The Court also directed J. Aron & Company and the Goldman Sachs Group to produce the documents they provided the Chapter 11 examiner in the Debtors' cases. About SemGroup LP SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream service company providing the energy industry means to move products from the wellhead to the wholesale marketplace. SemGroup provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storing energy. SemGroup serves customers in the United States, Canada, Mexico, Wales, Switzerland and Vietnam. SemGroup L.P. and its debtor-affiliates filed for Chapter 11 protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil, Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A. Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants L.L.C. is the Debtors' claims agent. The Debtors' financial advisors are The Blackstone Group L.P. and A.P. Services LLC. Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, represent the Debtors' prepetition lenders. SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude Company, sought protection under the Companies' Creditors Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc., is the appointed monitor of SemCanada Crude Company and its affiliates' reorganization proceedings before the Canadian Companies' Creditors Arrangement Act. The CCAA stay expires on November 21, 2008. SemGroup L.P.'s consolidated, unaudited financial conditions as of June 30, 2007, showed $5,429,038,000 in total assets and $5,033,214,000 in total debts. In their petition, they showed more than $1,000,000,000 in estimated total assets and more than $1,000,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by SemGroup L.P. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-700) SEMGROUP LP: Producers Committee Seeks Rule 2004 Discovery ---------------------------------------------------------- The Official Producers' Committee renews the motion it filed in November 2008 for an expedited production of documents by certain witnesses of SemGroup L.P., SemCrude L.P., and their debtor- affiliates, and for an examination of those witnesses pursuant to Rule 2004 of the Federal Rules of Bankruptcy Procedure. The OPC's prior motion had been scheduled for hearing but was adjourned on several prior occasions because the Debtors agreed to work with the OPC to resolve any continued disagreements, relates Norman L. Pernick, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware. He says despite the efforts of the parties, the flow of information the Debtors provided to the OPC has slowed considerably, and in some cases, were halted. In March 2009, the OPC conferred with the Debtors to resolve the various outstanding information requests, including information with respect to the Debtors' prepetition crude oil transactions with J. Aron & Company, BP Oil Supply Company, ConocoPhillips Company. The OPC's information request would also include, among others: (a) information and documents concerning the Debtors' proposed business plan forming the basis of its plan of reorganization; (b) an analysis, with supporting documents, for the enterprise value for the Debtors' Plan; (c) an analysis of the adequate protection afforded to the Producers, including an analysis of the current state of that adequate protection and how the protection would be impacted y the Debtors' proposed Plan; (d) information and analysis of the cash held at SemGroup level, and the beginning balance and all cash transfers between each Debtor and SemCrude L.P., Eaglwing L.P., and SemGas L.P. and their subsidiaries from the filing date until the present. (e) the Debtors' reconciliation of all set-off claims related to amounts due the SemCrude estate, including the supporting documents; (f) a list of funds held in suspense by Debtors at the owner level detail; (g) a status report on claims resolution; (h) a detailed schedule of bank debts and how it is calculated and allocated among members of the bank group; (i) certain missing borrowing base reports and supporting schedules; (j) an explanation and supporting documents regarding build-up in prepetition intercompany payables by Eaglwing, including a description of the components the payables; (k) an explanation of the $22 million variance between the Eaglwing scheduled obligations and the amount reported by Plains Marketing L.P. in its motion for a final settlement, and all supporting documents; and (l) a list of employees and professionals with knowledge of these information. The OPC also asks the Court for authority to issue subpoenas to the Debtors and their professionals for formal deposition, when necessary. Mr. Pernick says informal exchange of information has not worked in the original Rule 2004 Motion. About SemGroup LP SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream service company providing the energy industry means to move products from the wellhead to the wholesale marketplace. SemGroup provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storing energy. SemGroup serves customers in the United States, Canada, Mexico, Wales, Switzerland and Vietnam. SemGroup L.P. and its debtor-affiliates filed for Chapter 11 protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil, Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A. Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants L.L.C. is the Debtors' claims agent. The Debtors' financial advisors are The Blackstone Group L.P. and A.P. Services LLC. Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, represent the Debtors' prepetition lenders. SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude Company, sought protection under the Companies' Creditors Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc., is the appointed monitor of SemCanada Crude Company and its affiliates' reorganization proceedings before the Canadian Companies' Creditors Arrangement Act. The CCAA stay expires on November 21, 2008. SemGroup L.P.'s consolidated, unaudited financial conditions as of June 30, 2007, showed $5,429,038,000 in total assets and $5,033,214,000 in total debts. In their petition, they showed more than $1,000,000,000 in estimated total assets and more than $1,000,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by SemGroup L.P. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-700) SEMGROUP LP: Court Okays SemStream's Settlement With Koch Supply ---------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware approved the settlement between SemStream, L.P., and Koch Supply & Trading, L.P., in connection with a sales agreement and certain trading agreements between the parties, after the parties agreed on revised form of order and a letter agreement signed by Terrence Ronan, chief executive officer of SemGroup G.P., L.L.C. The Letter Agreement, which the Debtors' counsel, Ian Connor Bifferato, Esq., at Bifferato LLC, in Wilmington, Delaware, filed prior to entry of the order, indicated that the other SemGroup Debtors agreed to waive their claims related to the transactions between SemStream and KS&T. KS&T will pay SemStream $1,386,990 in full satisfaction for all amounts owed by KS&T to SemStream, the Court ruled. As reported by the Troubled Company Reporter on May 20, 2009, before its bankruptcy filing, SemStream delivered propane to KS&T under the Sales Agreement for which KS&T owes $926,100. Also, the parties determined that KS&T owes SemStream $460,890 after mutual set-off of obligations under the Trading Agreements. Thereafter, after a review of its records and the calculations accompanying KS&T's Claim No. 4602, SemStream believes that KS&T owes it an aggregate $1,386,990 under the Sales Agreements and Trading Agreements. About SemGroup LP SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream service company providing the energy industry means to move products from the wellhead to the wholesale marketplace. SemGroup provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storing energy. SemGroup serves customers in the United States, Canada, Mexico, Wales, Switzerland and Vietnam. SemGroup L.P. and its debtor-affiliates filed for Chapter 11 protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil, Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A. Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants L.L.C. is the Debtors' claims agent. The Debtors' financial advisors are The Blackstone Group L.P. and A.P. Services LLC. Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, represent the Debtors' prepetition lenders. SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude Company, sought protection under the Companies' Creditors Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc., is the appointed monitor of SemCanada Crude Company and its affiliates' reorganization proceedings before the Canadian Companies' Creditors Arrangement Act. The CCAA stay expires on November 21, 2008. SemGroup L.P.'s consolidated, unaudited financial conditions as of June 30, 2007, showed $5,429,038,000 in total assets and $5,033,214,000 in total debts. In their petition, they showed more than $1,000,000,000 in estimated total assets and more than $1,000,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by SemGroup L.P. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-700) SEMGROUP LP: Can Tap Russell Reynolds as Executive Search Advisors ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized SemGroup L.P. and its debtor-affiliates to employ Russell Reynolds Associates, Inc., as executive search advisors nunc pro tunc to May 5, 2009. The Troubled Company Reporter reported on June 1, 2009, that the Official Producers' Committee asked the Court to deny the Debtors' request because until the Debtors are able to file a facially confirmable plan, it is premature for them to be hiring professionals focused on post-emergence matters. Karen McKinley, Esq., at Cole, Schotz, Meisel, Forman & Leonard, P.A., in Wilmington, Delaware, noted that it is not yet clear if the Debtors can confirm a plan, noting that the plan proposed by the Debtors is premised on payment of $155 million in administrative claims only, although scheduled Section 503(b)(9) claims alone aggregate $295 million. The Troubled Company Reporter disclosed on May 20, 2009, that SemGroup L.P., SemCrude L.P., and their debtor affiliates, in preparation for the filing of their Chapter 11 plan of reorganization, formed a SemGroup Executive Search Committee -- consisting of three members of the DIP Lenders' steering committee and two members of the Official Committee of Unsecured Creditors -- to assist the Debtors in identifying individuals who will serve as chief executive officer, chief financial officer, and members of a six-person board of directors of the ultimate parent company, SemGroup Companies. For the contemplated services, the Debtors will pay Russell Reynolds: (a) a flat fee of $300,000 for its successful search of a CEO; (b) a $150,000 flat fee for a successful search of a CFO; (c) a $390,000 flat fee for recruiting six members of the HoldCo board of directors. If more than six directors are appointed, the Debtors will pay the firm $60,000 for each additional director appointed; (d) a $7,500 flat cost recovery for each of the three searches to cover search-related expenses that are difficult to allocate to individual projects; and (e) reimbursement for reasonable out-of-pocket expenses incurred in connection with the search. About SemGroup LP SemGroup L.P. -- http://www.semgrouplp.com/-- is a midstream service company providing the energy industry means to move products from the wellhead to the wholesale marketplace. SemGroup provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storing energy. SemGroup serves customers in the United States, Canada, Mexico, Wales, Switzerland and Vietnam. SemGroup L.P. and its debtor-affiliates filed for Chapter 11 protection on July 22, 2008 (Bankr. D. Del. Lead Case No. 08-11525). John H. Knight, Esq., L. Katherine Good, Esq. and Mark D. Collins, Esq., at Richards Layton & Finger; Harvey R. Miller, Esq., Michael P. Kessler, Esq., and Sherri L. Toub, Esq., at Weil, Gotshal & Manges LLP; and Martin A. Sosland, Esq., and Sylvia A. Mayer, Esq., at Weil Gotshal & Manges LLP, represent the Debtors in their restructuring efforts. Kurtzman Carson Consultants L.L.C. is the Debtors' claims agent. The Debtors' financial advisors are The Blackstone Group L.P. and A.P. Services LLC. Margot B. Schonholtz, Esq., and Scott D. Talmadge, Esq., at Kaye Scholer LLP; and Laurie Selber Silverstein, Esq., at Potter Anderson & Corroon LLP, represent the Debtors' prepetition lenders. SemGroup L.P.'s affiliates, SemCAMS ULC and SemCanada Crude Company, sought protection under the Companies' Creditors Arrangement Act (Canada) on July 22, 2008. Ernst & Young, Inc., is the appointed monitor of SemCanada Crude Company and its affiliates' reorganization proceedings before the Canadian Companies' Creditors Arrangement Act. The CCAA stay expires on November 21, 2008. SemGroup L.P.'s consolidated, unaudited financial conditions as of June 30, 2007, showed $5,429,038,000 in total assets and $5,033,214,000 in total debts. In their petition, they showed more than $1,000,000,000 in estimated total assets and more than $1,000,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes SemGroup Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by SemGroup L.P. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-700) SHOPPES AT SILVER: Case Summary & 3 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Shoppes at Silver Spring, LP 6499 Carlisle Pike Carlisle, PA 17055 Bankruptcy Case No.: 09-04454 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Middle District of Pennsylvania (Harrisburg) Judge: Mary D. France Debtor's Counsel: Robert E. Chernicoff, Esq. Cunningham and Chernicoff PC 2320 North Second Street Harrisburg, PA 17110 Tel: (717) 238-6570 Fax: (717) 238-4809 Email: rec@cclawpc.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 3 largest unsecured creditors is available for free at: http://bankrupt.com/misc/pamb09-04454.pdf The petition was signed by Eric Cremo, president of the Company. SILVER SPOONS: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: Silver Spoons Investment & Development Company fka Silver Spoons Yogurt & Ice Cream Company 19186 Valley Blvd. Bloomington, CA 92316 Bankruptcy Case No.: 09-22780 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Central District of California (Riverside) Judge: Sheri Bluebond Debtor's Counsel: Fred M. Cohen, Esq. 8480 Red Oak Ave Rancho Cucamonga, CA 91730 Tel: (909) 484-5481 Fax: (909) 948-0686 Email: fmcbktaxlaw@hotmail.com Total Assets: $1,103,100 Total Debts: $365,000 The Company says it does not have unsecured creditors who are not insiders when they filed their petition. The petition was signed by Khalid Fakhoury, president of the Company. SMURFIT-STONE: Has Until Sept. 23 to File Plan of Reorganization ---------------------------------------------------------------- Judge Brendan L. Shannon of the United States Bankruptcy Court for the District of Delaware has extended Smurfit-Stone Container Corp. and its debtor-affiliates' exclusive period to file a plan or plans of reorganization to September 23, 2009, and their exclusive period to solicit and obtain acceptances of that plan to November 23, 2009. As previously reported, the Debtors' Exclusive Plan Filing Period was set to expire on May 26, 2009, and their Plan Solicitation Period was set to expire on July 25, 2009. The judge's order is without prejudice to the Debtors' right to ask further extensions of the Exclusive Periods. Before the judge entered the Order, the Official Committee of Unsecured Creditors told the Court that the Debtors have been working cooperatively with the Committee towards a successful emergence from Chapter 11 and the Committee supports the Debtors in their request to extend the Exclusive Periods. Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, also certified that as of May 15, 2009, there were no objections to the Debtors' request. John Murphy as New CFO In a regulatory filing with the Securities and Exchange Commission, Craig A. Hunt, Smurfit-Stone Container Corporation's senior vice president, secretary, and general counsel, disclosed that effective May 18, 2009, Charles A. Hinrichs resigned as senior vice president and chief financial officer of SSCC. To replace Mr. Hinrichs, SSCC appointed John R. Murphy to the position of senior vice president and chief financial officer. Mr. Murphy previously served as the president and chief executive officer of Accuride Corporation, a North American manufacturer and supplier of commercial vehicle components from October 2007 until September 2008. From January 2007 until October 2007, Mr. Murphy held the position of president and chief financial officer of Accuride. Mr. Murphy previously served as Accuride's president and chief financial officer from February 2006 until December 2006, and as Accuride's executive vice president fir finance and chief financial officer from March 1998 until January 2006. About Smurfit-Stone Container Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs approximately 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported approximately $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: Seeks Court Approval to Sell Fullerton Property -------------------------------------------------------------- Smurfit-Stone Container Corp. and its debtor-affiliates ask the United States Bankruptcy Court for the District of Delaware for authority to sell a property located at 1424 S. Raymond Avenue, in Fullerton, California, free and clear of all liens and encumbrances, to Western Realco LLC for $8,250,000 or to any other bidder who presents a higher and better offer pursuant to certain bidding procedures. James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, submits that the Fullerton Property is no longer being used in the Debtors' business operations. He notes that the Fullerton Property currently costs the Debtors more than $25,000 per month, including maintenance costs and property taxes. The Fullerton Property is the former site of a box manufacturing plant that was part of the Debtors' Container Division. However, the Debtors closed the plant in June 2008 and determined that it would be in their best interests to sell the Fullerton Property. The Fullerton Property is 14.91 acres and currently contains approximately 192,500 S.F. of existing structures, plus several concrete loading platforms, all of which require demolition. Mr. Conlan says that the Debtors marketed the Fullerton Property through Grubb & Ellis Company in 2008 and through their efforts, three groups submitted bids -- with Western Realco as the highest bidder. However, as the investment and credit climate changed, Western Realco decreased its offer and the two other prospective buyers lost interest in the Fullerton Property. Subsequently, the Debtors entered into a purchase and sale agreement with Western Realco. The Agreement provides that Western Realco will purchase the Fullerton Property for $8,250,000 in cash or immediately available funds. Western Realco has deposited $500,000 in immediately available funds in escrow. Mr. Conlan tells the Court that the Proposed Sale will close within 15 days after the Court's approval. The Purchase Price will be deposited into escrow in cash or other immediately available funds, which will be delivered to the Debtors at the date that a grant deed conveying the Fullerton Property is recorded in the Official Records of Orange County, California. In addition to the terms embodied in the Agreement, the Parties have agreed that if the Court does not approve the Proposed Sale by July 10, 2009, Western Realco may at any time thereafter, in its sole and absolute discretion, terminate the Agreement. In the event that there are overbids and Western Realco is not the Successful Bidder, Western Realco may terminate the Agreement if the sale of the Fullerton Property to the Successful Bidder does not close within 15 days after the Court's approval. Otherwise, the Agreement will remain open until 48 hours after the closing of the sale to a successful bidder. Moreover, if an initial successful bidder fails to consummate the sale, the Parties have agreed that the closing deadline in the Agreement would be extended until 15 days after the Debtors notify Western Realco that it's bid is the new Successful Overbid. If Western Realco exercises its right to terminate the Agreement, the termination will be made in writing, and the Initial Deposit will be refunded in full to Western Realco within five business days of the Debtor's receipt of the termination. A full-text copy of the proposed bidding procedures is available for free at: http://bankrupt.com/misc/SmurfFullBidProcs.pdf About Smurfit-Stone Container Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs approximately 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported approximately $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SMURFIT-STONE: Court Okays Employment of Grubb & Ellis as Broker ---------------------------------------------------------------- Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware, relates that after Smurfit-Stone Container Corp. and its debtor-affiliates submitted their application to employ Grubb & Ellis Company as their real estate broker, they received comments from the Official Committee of Unsecured Creditors. Accordingly, the Debtors revised the proposed order submitted together with the Application to reflect that the Debtors are required to expend all service credits in the payment of any fees earned by Grubb & Ellis prior to their payment in cash, except that the Debtors may reserve an initial cache of $60,000 service credits to pay certain administrative fees -- estimated at approximately $5,000 per month owed to Grubb & Ellis. In addition, the Debtors also specified in the Revised Proposed Order that the services provided by Grubb & Ellis will not be duplicative of those provided by The Levin Group LP, PricewaterhouseCoopers LLP, Studley, Inc., or Lazard Freres & Co. LLC. A blackline version of the Revised Proposed Order is available for free at: http://bankrupt.com/misc/GrubbEllisPropOrd.pdf * * * Subsequently, Judge Brendan L. Shannon of the United States Bankruptcy Court for the District of Delaware signed the Revised Proposed Order. As reported by the Troubled Company Reporter on May 14, 2009, the Debtors sought the Court's authority to employ Grubb & Ellis as their real estate broker in connection with matters related to the sale, lease, acquisition, or renegotiation of existing leases for the Debtors' manufacturing real estate assets throughout the United States and Canada, nunc pro tunc to February 27, 2009. Grubb & Ellis is one of the largest real estate services and investment companies worldwide with more than 130 owned and affiliated offices. Specifically, the Debtors need Grubb & Ellis to perform commercial real estate brokerage and consulting services relating to: * acquisitions, including, without limitation, lease acquisitions, lease renewals/renegotiations and property sales, pursuant to a process involving market studies, RFP solicitations and evaluation and leases and contract negotiations; * dispositions, including, without limitation, subleases, sale/leasebacks, lease buyouts and property sales, pursuant to a process involving market studies, RFP so1icitations, evaluation and lease/sublease/contract negotiations, including, without limitation, these specific services: (a) preparation of marketing plans; (b) preparation of broker's opinion of value; (c) copying, management and tabulation of information pertaining to the Debtors' properties, including information from the Debtors' existing paper property files, in paper and electronic form, on databases and software programs providing direct access by the Debtors; (d) provision of written quarterly status reports; and (e) preparation of marketing strategies and timelines. The Debtors will pay Grubb & Ellis a commission in accordance with the customary prevailing rates in the market where the specific property is located. However, all commissions received by Grubb & Ellis will be capped at eight percent of the total value of the acquisition, lease extension, renegotiation, or sale. In addition, if Grubb & Ellis receives a commission above a certain threshold amount, the Debtors will be entitled to certain service credits equal to 25% of any commission in excess of $10,000 received by Grubb & Ellis for representing the Debtors in connection with any acquisition or sale transaction. Grubb & Ellis will indemnify and hold the Debtors harmless from and against any claim, actions, demands, damages or expenses, including court costs and reasonable attorneys fees; to the extent arising out of the actions or dealings of Grubb & Ellis' personnel and directly or indirectly out of: (a) any claim for commission in connection with any acquisition or disposition with respect to which Grubb & Ellis provided services; (b) any claim of fraud, or negligent or intentional misrepresentation; (c) any negligence of Grubb & Ellis' personnel; or (d) any claim for commission by any co-broker or permitted sub-agent. Shawn Mobley, executive vice president and managing director of Grubb & Ellis, assured the Court that his firm does not hold or represent any interest adverse to the Debtors' estates, and is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Smurfit-Stone Container Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs approximately 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported approximately $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) SPC SENIOR: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: SPC Senior Managment LLC dba Park Creek Center 10064 North Church Drive Parma Heights, OH 44130 Bankruptcy Case No.: 09-15269 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Northern District of Ohio (Cleveland) Judge: Pat E. Morgenstern-Clarren Debtor's Counsel: Frederic P. Schwieg, Esq. Attorney at Law 2705 Gibson Dr Rocky River, OH 44116-3008 Tel: (440) 499-4506 Email: fschwieg@schwieglaw.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ohn09-15269.pdf The petition was signed by Larry Childs, member of the Company. SPORTSMAN'S WAREHOUSE: Proposes Incentive Pay for Key Employees --------------------------------------------------------------- Sportsman's Warehouse Inc. asks the U.S. Bankruptcy Court to approve a restructuring-based incentive and retention pay to 33 of its officers and other employees. The Company proposes to pay $198,000 to its top 8 executives in bonuses dependent on how much unsecured creditors realize from the Chapter 11 plan, Bloomberg's Bill Rochelle reports. If creditors take home 10% percent or less, the executives receive nothing. Should unsecured creditors see 10% to 20%, the executives will earn half the bonus pool. The bonuses will be paid in full once unsecured creditors' recovery reaches 30%. Twenty-five workers are to receive $213,000 in bonuses if the U.S. Bankruptcy Court for the District of Delaware approves the bonus incentive plan at a June 24 hearing. The Court has set a hearing for June 24 to consider the approval of Sportsman's Warehouse disclosure statement. The plan proposes giving unsecured creditors a share of available cash, a four-year note payable out of excess cash flow, and a waiver of claims the company could bring to recover so-called preferences. To qualify, an unsecured creditor must agree to provide 30 days' trade credit after the emergence from Chapter 11. If an unsecured creditor doesn't provide credit, it will only receive a sharing in the cash flow note and could be sued to give back payments received within 90 days of bankruptcy. Existing stock will be canceled. The new stock will go to a plan sponsor who invests $5 million. The plan sponsor was not named in the original draft disclosure statement. Headquartered in Midvale, Utah, Sportsman's Warehouse, Inc. -- http://www.sportsmanswarehouse.com/-- and its affiliates sell indoors and outdoor gears and equipment. The Companies filed for Chapter 11 bankruptcy protection on March 20, 2009 (Bankr. D. Delaware Bankr. Case No. 09-10990). Gregg M. Galardi, Esq., at Skadden, Arps, Slate, Meagher assists the Companies in their restructuring efforts. Kurtzman Carson Consultants is the Company's claims agent. The Company listed assets of $436 million against debt totaling $452 million as of Dec. 31, 2008. SUNGARD DATA: Amendment on Loan Won't Affect Fitch's 'B' Rating --------------------------------------------------------------- Fitch's ratings and Negative Outlook on SunGard Data Systems, Inc., are unaffected by the company's amendment and extension of its secured credit facilities. Fitch currently rates SunGard: -- Issuer Default Rating 'B'; -- $4.7 billion senior secured term loan due 2014 and 2016 'BB- /RR2'; -- $829 million senior secured revolving credit facility (RCF) due 2011 and 2013 'BB-/RR2'; -- $250 million 4.875% senior notes due 2014 'B/RR4'; -- $1.6 billion 9.125% senior unsecured notes due 2013 'B-/RR5'; -- $500 million 10.625% senior unsecured notes due 2015 'B- /RR5'; -- $1 billion 10.25% senior subordinated notes due 2015 'CCC/RR6'. On June 9, SunGard amended the senior secured credit agreement governing its $4.7 billion term loan (including the $4.2 billion original term loan and $500 million incremental term loan) and $1 billion RCF. The amended terms include the: i) extension of the maturity of approximately $2.7 billion of the original term loan to 2016 from 2014; ii) reduction of the RCF to $829 million from $1 billion and extension of the expiration of $580 million of capacity to 2013 from 2011; iii) relaxation of financial covenants, including a 0.75 times (x) increase in maximum total leverage beginning Q4'10 and onward and an increase in maximum capex from $450 million to $475 million beginning 2014; iv) resetting the basket for acquisition of non-guarantor subsidiaries, including foreign subsidiaries, to $325 million; and v) increased flexibility around refinancing options for the term loan and RCF. The amendments reduce intermediate-term refinancing risk by spreading SunGard's maturity schedule through 2016, a modest positive in Fitch's view. The previous maturity schedule was highly concentrated in 2013-2014, with more than 75% of total debt maturing during this period. Fitch also views the relaxation of the leverage covenant positively, given the resultant reduced risk of EBITDA declines leading to covenant breaches over the medium term, a concern previously raised by Fitch. However, Fitch believes the increased flexibility for acquisitions provided by the looser financial covenant and increased carve-out for international acquisitions could drive a somewhat more aggressive use of cash and/or debt for acquisitions over the medium term, potentially reducing the focus on debt reduction. Additionally, the increased pricing and fees associated with the amendment will further reduce free cash flow, which Fitch already expects to be under pressure due to lower operating profits. Fitch expects that free cash flow could decline to $150 million-$200 million in 2009, compared with over $300 million in recent years. While the aforementioned developments are a net positive, the Negative Outlook primarily reflects Fitch's expectations of meaningful declines in organic revenue and EBITDA at SunGard's Financial Systems segment through at least 2009. Aside from weaker customer demand, Fitch believes revenues and profitability will be negatively affected by increased pricing pressure upon contract renewal and a reduction of the customer base due to anticipated consolidation. Over the longer term, Fitch believes that the heightened degree of uncertainty around the size and profile of the financial services industry represents an additional source of ratings pressure. Operating profits from Higher Education (HE), Public Sector and, to a lesser extent, SunGard's Availability Services businesses, are also expected to decline in 2009, reducing these businesses' ability to offset expected declines in FS. Such profitability declines could drive leverage outside of Fitch's expectations for the ratings category, as well as pressure free cash flow. Total debt at March 31, 2009 was $8.6 billion and consisted primarily of: $4.7 billion of senior secured term loans, of which approximately $2 billion expires 2014 and $2.7 billion expires 2016; approximately $225 million drawn under the senior secured RCF expiring 2011 and 2013; $250 million outstanding under the company's new on-balance accounts receivable securitization facility (the facility was increased by $66.5 million subsequent to quarter end); approximately $250 million of 4.875% senior notes due 2014, which are secured by real property; $1.6 billion of 9.125% senior unsecured notes due 2013; $500 million of 10.625% senior unsecured notes due 2015 and $1 billion of 10.25% senior subordinated notes due 2015. Fitch believes SunGard's current liquidity position is sufficient, given the company's minimal near-term debt service needs. Pro forma for the amendments, liquidity as of March 31, 2008 consisted of $491 million of cash and approximately $604 million available under its $829 million RCF, of which $249 million expires 2011 and $580 million expires 2013. Liquidity is also supported by annual free cash flow, which as previously mentioned, is expected to decline to $150 million-$200 million in 2009, driven by lower operating profits and higher interest expense associated with the term loan and RCF. SUNGARD DATA: S&P Affirms Corporate Credit Rating at 'B+' --------------------------------------------------------- Standard & Poor's Ratings Services said it affirmed its 'B+' corporate credit rating on SunGard Data Systems Inc. S&P also assigned a 'BB' issue rating to SunGard's $2.7 billion tranche B secured term loan maturing Feb. 28, 2016, and to the $580 million secured revolving credit facility maturing May 11, 2013. S&P assigned a recovery rating of '1' to the debt, indicating the prospect for very high (90%-100%) recovery in the event of a payment default. "The rating affirmation and stable outlook reflect Wayne, Pa.- based SunGard's highly leveraged financial profile and somewhat acquisitive growth strategy," said Standard & Poor's credit analyst Martha Toll-Reed. Although the amendments to the senior credit facility will help to smooth SunGard's debt maturity profile and provide more covenant flexibility in the out years, the near-term impact on its financial profile is negligible. Added Ms. Toll-Reed, "These factors are partially offset by SunGard's strong position in the fragmented market for investment- support processing software and services and its large share of the disaster-recovery/business-continuity services market." TERRY PAINTER: Case Summary & 15 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Terry Painter 104 Monterey Drive Medford, OR 97504 Bankruptcy Case No.: 09-62997 Chapter 11 Petition Date: June 8, 2009 Court: United States Bankruptcy Court District of Oregon Judge: Frank R. Alley III Debtor's Counsel: John Putnam Pries, Esq. 860 Olive St. Eugene, OR 97401 Tel: (541) 343-0684 Email: notice@johnprieslaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 15 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/orb09-62997.pdf The petition was signed by Terry Painter. THOMPSON RESIDUARY: Case Summary & 15 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Thompson Residuary Investors, LLC c/o Stephen A. Wexler 8230 Leesburg Pike, Suite 610 Vienna, VA 22182 Bankruptcy Case No.: 09-14594 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court Eastern District of Virginia (Alexandria) Debtor's Counsel: James M. Lewis, Esq. Rees Broome, P.C. 8133 Leesburg Pike, 9th floor Vienna, VA 22182 Tel: (703) 790-1911 Fax: (703) 848-2530 Email: jlewis@reesbroome.com Total Assets: $8,424,900 Total Debts: $9,314,743 A full-text copy of the Debtor's petition, including a list of its 15 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/vae09-14594.pdf The petition was signed by CRSC, LLC by Stephen A. Wexler. TOUSA INC: Creditors Committee Sues Former Directors ---------------------------------------------------- The official committee of unsecured creditors of Tousa Inc. and its debtor affiliates has filed an adversary complaint in the U.S. Bankruptcy Court for the Southern District of Florida against the company's former directors and the company's majority shareholder Technical Olympic, S.A. The Committee alleges that the defendants caused the debtor subsidiaries to incur over $500 million in debt so that TOUSA Inc. and TOUSA Homes LP could repay an old debt for which the debtor subsidiaries were never liable. The debtor subsidiaries are comprised of all direct and indirect subsidiaries of TOUSA in these Chapter 11 cases, except Homes LP, Engle Sierra Verde P5, LLC, Engle/Gilligan LLC and Beacon Hill at Mountain's Edge LLC. The Committee says the director defendants breached their fiduciary duties by, among other things, acting solely in the interest of TOUSA and shareholders of TOUSA in failing to investigate and inform themselves properly of the effect of the transaction on the debtor subsidiaries and their creditors. These breaches occurred, the Committee adds, when the debtor subsidiaries were "either insolvent or were in the zone of insolvency." Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. TOUSA designs, builds, and markets high-quality detached single-family residences, town homes, and condominiums to a diverse group of homebuyers, such as "first-time" homebuyers, "move-up" homebuyers, homebuyers who are relocating to a new city or state, buyers of second or vacation homes, active-adult homebuyers, and homebuyers with grown children who want a smaller home. It also provides financial services to its homebuyers and to others through its subsidiaries, Preferred Home Mortgage Company and Universal Land Title Inc. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on January 29, 2008 (Bankr. S.D. Fla. Case No. 08-10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It listed assets between $1 million and $10 million, and debts between $1 million and $10 million. The Official Committee of Unsecured Creditors hired Patricia A. Redmond, Esq., and the law firm Stearns Weaver Weissler Alhadeff & Sitterson, P.A., as its local counsel. TOUSA Inc.'s balance sheet at June 30, 2008, showed total assets of $1,734,422,756 and total liabilities of $2,300,053,979. Bankruptcy Creditors' Service, Inc., publishes TOUSA Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by TOUSA Inc. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TRIBUNE COMPANY: Beatty Asks Court to Lift Stay on D. Tracy Suit ---------------------------------------------------------------- Actor Warren Beatty asks the U.S. Bankruptcy Court for the District of Delaware to let his lawsuit against Tribune Media Services, Inc., a unit of bankruptcy newspaper publisher Tribune Company, over movie and television rights to comic strip character Dick Tracy to proceed, claiming that a district court in California is the best forum for the dispute. Mr. Beatty filed the motion with the Bankruptcy Court on Tuesday. Mr. Beatty asked the Hon. Kevin J. Carey to lift the automatic stay to allow him to proceed with the California lawsuit. The California case is Warren Beatty v. Tribune Media Services, Inc., et al., 08-07662. On December 8, 2008, Tribune Company, et al. filed for Chapter 11. As a result of Tribune's bankruptcy, the California lawsuit was stayed. Notwithstanding the existence of Mr. Beatty's lawsuit, on March 19, 2009, Tribune Media commenced an action against Mr. Beatty in the Bankruptcy Court to recover motion picture and television rights to the Dick Tracy comic strip character. On May 8, 2009, Mr. Beatty filed a motion to dismiss the complaint for improper venue and lack of personal jurisdiction. The motion is pending before the Bankruptcy Court. About Tribune Co. Headquartered in Chicago, Illinois, Tribune Company -- http://www.tribune.com/-- is a media company, operating businesses in publishing, interactive and broadcasting, including ten daily newspapers and commuter tabloids, 23 television stations, WGN America, WGN-AM and the Chicago Cubs baseball team. The Company and 110 of its affiliates filed for Chapter 11 protection on December 8, 2008 (Bankr. D. Del. Lead Case No. 08-13141). The Debtors proposed Sidley Austion LLP as their counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims agent. As of December 8, 2008, the Debtors have $7,604,195,000 in total assets and $12,972,541,148 in total debts. Bankruptcy Creditors' Service, Inc., publishes Tribune Bankruptcy News. The newsletter tracks the chapter 11 proceeding undertaken by Tribune Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TWELVE OAKS: Case Summary & 11 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Twelve Oaks JV, LLC c/o Lee Katz 333 Sandy Springs Circle Atlanta, GA 30328 Bankruptcy Case No.: 09-74960 Chapter 11 Petition Date: June 10, 2009 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Debtor's Counsel: Cameron M. McCord, Esq. Jones & Walden, LLC 21 Eighth Street, NE Atlanta, GA 30309 Tel: (404) 564-9300 Fax: (404) 564-9301 Email: cmccord@joneswalden.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 11 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ganb09-74960.pdf The petition was signed by Lee Katz. UAL CORP: Weak Credit Profile Cues Fitch to Junk Issuer Rating -------------------------------------------------------------- Fitch Ratings has downgraded the debt ratings for UAL Corp. and its principal operating subsidiary United Airlines, Inc.: UAL -- Issuer Default Rating (IDR) to 'CCC' from 'B-'. United -- IDR to 'CCC' from 'B-'; -- Secured bank credit facility (Term Loan and Revolving Credit Facility) to 'B+/RR1' from 'BB-/RR1'; -- Senior unsecured debt to 'C'/RR6 from 'CCC'/RR6. The credit facility rating applies to approximately $1.3 billion of term loan debt, and the unsecured rating applies to approximately $876 million of outstanding convertible notes. Fitch no longer maintains a Rating Outlook for UAL and United. The downgrade reflects Fitch's view that the airline's credit profile is likely to weaken further, as extreme pressure in the revenue environment continues to undermine the positive cash flow impact of lower jet fuel prices in 2009. Despite preliminary signs of a moderation of year-over-year deterioration in passenger yields and revenue per available seat mile in April, the revenue picture appeared to worsen again in May as H1N1 flu concerns depressed industry bookings further. Although domestic leisure- oriented demand is holding up reasonably well as the recession continues, passenger yield and RASM trends in premium business travel markets will likely improve only slowly as the economy strengthens somewhat moving into 2010. Fitch expects United's operating results and free cash flow generation to remain weak through the remainder of the year, largely as a result of its heavy exposure to premium business markets that have seen the steepest declines in passenger yields and RASM following the rapid pull-back in corporate travel spending that accelerated late in 2008 and into the first quarter of 2009. Trans-Atlantic and trans-Pacific RASM trends are expected to be especially weak this summer as carriers discount seats aggressively to maintain good load factors on a lower available seat mile capacity base. Even in domestic markets, revenue pressure is likely to continue on higher-yielding trans- continental routes where United has significant exposure. In spite of the early and significant rationalization of capacity undertaken by United and the rest of the industry in 2008, unit revenue pressure has remained intense this year as the full impact of the global recession on premium travel demand has become clear. Passenger RASM declines in excess of 19% reported by both Continental and US Airways for the month of May suggest that the industry revenue environment is not stabilizing in line with other consumer spending and macroeconomic indicators. Rather, Fitch is increasingly concerned that a continuation of weak revenue patterns through the summer could erode much of the industry's cash flow generation potential for 2009. For United, with a large presence in the weakest business markets, Fitch believes that a slow second-half revenue recovery scenario could drive full-year passenger RASM declines of more than 10%. United's free cash flow outlook, while supported by the recent reduction of its full-year capital spending plan to $350 million from $450 million, has been pressured significantly by the ongoing revenue softness. Factoring in only a slow moderation of unit revenue deterioration in the second half of the year, Fitch believes that United could report substantially negative free cash flow for the final three quarters of 2009. While negative free cash flow margins will improve significantly over 2008, Fitch believes that internal cash generation alone will not be sufficient to prevent an erosion of the carrier's unrestricted liquidity position by year end. Despite the absence of near-term aircraft capital commitments, United does face steady and heavy debt maturities that will require the carrier to generate positive free cash flow over time. As of April 21, 2009, United reported scheduled maturities of debt and capital leases totaling $655 million for the final three quarters of 2009. Even if revenue trends stabilize late in the year, the airline faces over $1 billion in scheduled debt and capital lease principal payments next year, raising the probability of a deepening liquidity crisis. Looking beyond 2010, the airline must meet scheduled debt maturities of $869 million in 2011. Given its heavy fixed financing obligations, and in light of the carrier's poor near-term cash flow generation capacity, Fitch views United's highly-leveraged capital structure as unsustainable in the absence of a sharp turnaround in industry operating fundamentals. Substantial year-over-year fuel cost savings continue to offset much of the intense revenue pressure that has been felt in the first half of the year. Despite the recent run-up in energy prices, with crude oil topping $70 per barrel by early June, United will realize significant cash savings this year. Based on current futures prices, Fitch estimates that United could realize over $3.5 billion in full year fuel expense reduction in addition to cash savings linked to the return of cash collateral held by fuel hedge counter-parties. United indicated in April that it expected $940 million of the $965 million in fuel hedge collateral posted as of year-end 2008 to be returned by the end of this year. During the first quarter alone, lower fuel hedge collateral drove $395 million in operating cash inflows (offset in part by $286 million in outflows tied to net changes of fuel derivatives and related pending settlements). As United's fuel hedge position diminishes through the remainder of the year, the carrier's fuel expenses will become more closely tied to changes in the spot price of jet fuel. Liquidity was supplemented by extensive capital raising activity in the first quarter and some positive operating cash flow swings linked to hedge collateral changes, proceeds from the amendment of an airport lease agreement and normal seasonal increases in the air traffic liability. Total unrestricted cash of $2.5 billion as of March 31, 2009 represented approximately 13% of latest twelve months revenues. In addition to cash on hand, management has indicated that an estimated $1.7 billion in remaining unencumbered assets could be used to improve liquidity in the future. However, since much of the unencumbered asset base (e.g., older aircraft and engines) cannot be easily monetized, Fitch believes that United may have difficulty raising a large amount of new capital over the near-term as credit market conditions remain very tight. The need to comply with credit facility financial covenants, suspended for four quarters after United negotiated an amendment with lenders during the 2008 fuel crisis, resumes in the current quarter. With respect to the most binding EBITDAR fixed charge coverage covenant, the airline must meet a 1.0 times (x) coverage requirement for the three months ending June 30, 2009. The requirement steps up to 1.1x for the six months ending Sept. 30, 2009 and 1.2x for the nine months ending Dec. 31, 2009. As defined in the credit facility agreement, calculated EBITDAR in the fixed charge ratio's numerator is adjusted for a number of special items, including frequent flyer revenue items. By definition, the calculation includes GAAP fuel expense, which captures the impact of fuel hedge gains as hedge collateral is returned. Fixed charges in the denominator are defined as cash interest payments plus cash aircraft rents. This figure excludes non-cash items such as those associated with the recent accounting change related to the treatment of convertible debt. Given its extremely high lease-adjusted leverage, United has no flexibility to finance new aircraft over the near-term, and its no-growth fleet and capacity plan reflects a need to de-lever the balance sheet before any new aircraft capital spending can occur. Reports of United's interest in the initiation of a widebody order competition between Boeing and Airbus, in Fitch's view, reflect a longer-term need to replace aging widebody aircraft over the next several years. As a result, this development has no short-term implications for United's credit profile or ratings. Successful financing of such a large multi-year order, in Fitch's opinion, would require a significant improvement in United's credit profile and the industry operating environment. A downgrade of the IDR to 'CC' or 'C' could follow in a scenario where United's unrestricted liquidity approaches $1.5 billion later this year or in 2010. Liquidity pressure of this magnitude could result from a further deterioration of demand and unit revenue trends in the second half of the year. A material energy price shock, while less likely, could also pressure cash flow further and drain cash from the airline. UNITED AIRLINES: Fitch Junks Issuer Default Rating -------------------------------------------------- Fitch Ratings has downgraded the debt ratings for UAL Corp. and its principal operating subsidiary United Airlines, Inc.: UAL -- Issuer Default Rating (IDR) to 'CCC' from 'B-'. United -- IDR to 'CCC' from 'B-'; -- Secured bank credit facility (Term Loan and Revolving Credit Facility) to 'B+/RR1' from 'BB-/RR1'; -- Senior unsecured debt to 'C'/RR6 from 'CCC'/RR6. The credit facility rating applies to approximately $1.3 billion of term loan debt, and the unsecured rating applies to approximately $876 million of outstanding convertible notes. Fitch no longer maintains a Rating Outlook for UAL and United. The downgrade reflects Fitch's view that the airline's credit profile is likely to weaken further, as extreme pressure in the revenue environment continues to undermine the positive cash flow impact of lower jet fuel prices in 2009. Despite preliminary signs of a moderation of year-over-year deterioration in passenger yields and revenue per available seat mile in April, the revenue picture appeared to worsen again in May as H1N1 flu concerns depressed industry bookings further. Although domestic leisure- oriented demand is holding up reasonably well as the recession continues, passenger yield and RASM trends in premium business travel markets will likely improve only slowly as the economy strengthens somewhat moving into 2010. Fitch expects United's operating results and free cash flow generation to remain weak through the remainder of the year, largely as a result of its heavy exposure to premium business markets that have seen the steepest declines in passenger yields and RASM following the rapid pull-back in corporate travel spending that accelerated late in 2008 and into the first quarter of 2009. Trans-Atlantic and trans-Pacific RASM trends are expected to be especially weak this summer as carriers discount seats aggressively to maintain good load factors on a lower available seat mile capacity base. Even in domestic markets, revenue pressure is likely to continue on higher-yielding trans- continental routes where United has significant exposure. In spite of the early and significant rationalization of capacity undertaken by United and the rest of the industry in 2008, unit revenue pressure has remained intense this year as the full impact of the global recession on premium travel demand has become clear. Passenger RASM declines in excess of 19% reported by both Continental and US Airways for the month of May suggest that the industry revenue environment is not stabilizing in line with other consumer spending and macroeconomic indicators. Rather, Fitch is increasingly concerned that a continuation of weak revenue patterns through the summer could erode much of the industry's cash flow generation potential for 2009. For United, with a large presence in the weakest business markets, Fitch believes that a slow second-half revenue recovery scenario could drive full-year passenger RASM declines of more than 10%. United's free cash flow outlook, while supported by the recent reduction of its full-year capital spending plan to $350 million from $450 million, has been pressured significantly by the ongoing revenue softness. Factoring in only a slow moderation of unit revenue deterioration in the second half of the year, Fitch believes that United could report substantially negative free cash flow for the final three quarters of 2009. While negative free cash flow margins will improve significantly over 2008, Fitch believes that internal cash generation alone will not be sufficient to prevent an erosion of the carrier's unrestricted liquidity position by year end. Despite the absence of near-term aircraft capital commitments, United does face steady and heavy debt maturities that will require the carrier to generate positive free cash flow over time. As of April 21, 2009, United reported scheduled maturities of debt and capital leases totaling $655 million for the final three quarters of 2009. Even if revenue trends stabilize late in the year, the airline faces over $1 billion in scheduled debt and capital lease principal payments next year, raising the probability of a deepening liquidity crisis. Looking beyond 2010, the airline must meet scheduled debt maturities of $869 million in 2011. Given its heavy fixed financing obligations, and in light of the carrier's poor near-term cash flow generation capacity, Fitch views United's highly-leveraged capital structure as unsustainable in the absence of a sharp turnaround in industry operating fundamentals. Substantial year-over-year fuel cost savings continue to offset much of the intense revenue pressure that has been felt in the first half of the year. Despite the recent run-up in energy prices, with crude oil topping $70 per barrel by early June, United will realize significant cash savings this year. Based on current futures prices, Fitch estimates that United could realize over $3.5 billion in full year fuel expense reduction in addition to cash savings linked to the return of cash collateral held by fuel hedge counter-parties. United indicated in April that it expected $940 million of the $965 million in fuel hedge collateral posted as of year-end 2008 to be returned by the end of this year. During the first quarter alone, lower fuel hedge collateral drove $395 million in operating cash inflows (offset in part by $286 million in outflows tied to net changes of fuel derivatives and related pending settlements). As United's fuel hedge position diminishes through the remainder of the year, the carrier's fuel expenses will become more closely tied to changes in the spot price of jet fuel. Liquidity was supplemented by extensive capital raising activity in the first quarter and some positive operating cash flow swings linked to hedge collateral changes, proceeds from the amendment of an airport lease agreement and normal seasonal increases in the air traffic liability. Total unrestricted cash of $2.5 billion as of March 31, 2009 represented approximately 13% of latest twelve months revenues. In addition to cash on hand, management has indicated that an estimated $1.7 billion in remaining unencumbered assets could be used to improve liquidity in the future. However, since much of the unencumbered asset base (e.g., older aircraft and engines) cannot be easily monetized, Fitch believes that United may have difficulty raising a large amount of new capital over the near-term as credit market conditions remain very tight. The need to comply with credit facility financial covenants, suspended for four quarters after United negotiated an amendment with lenders during the 2008 fuel crisis, resumes in the current quarter. With respect to the most binding EBITDAR fixed charge coverage covenant, the airline must meet a 1.0 times (x) coverage requirement for the three months ending June 30, 2009. The requirement steps up to 1.1x for the six months ending Sept. 30, 2009 and 1.2x for the nine months ending Dec. 31, 2009. As defined in the credit facility agreement, calculated EBITDAR in the fixed charge ratio's numerator is adjusted for a number of special items, including frequent flyer revenue items. By definition, the calculation includes GAAP fuel expense, which captures the impact of fuel hedge gains as hedge collateral is returned. Fixed charges in the denominator are defined as cash interest payments plus cash aircraft rents. This figure excludes non-cash items such as those associated with the recent accounting change related to the treatment of convertible debt. Given its extremely high lease-adjusted leverage, United has no flexibility to finance new aircraft over the near-term, and its no-growth fleet and capacity plan reflects a need to de-lever the balance sheet before any new aircraft capital spending can occur. Reports of United's interest in the initiation of a widebody order competition between Boeing and Airbus, in Fitch's view, reflect a longer-term need to replace aging widebody aircraft over the next several years. As a result, this development has no short-term implications for United's credit profile or ratings. Successful financing of such a large multi-year order, in Fitch's opinion, would require a significant improvement in United's credit profile and the industry operating environment. A downgrade of the IDR to 'CC' or 'C' could follow in a scenario where United's unrestricted liquidity approaches $1.5 billion later this year or in 2010. Liquidity pressure of this magnitude could result from a further deterioration of demand and unit revenue trends in the second half of the year. A material energy price shock, while less likely, could also pressure cash flow further and drain cash from the airline. WESTERN SUPPLY CORP.: Case Summary & 20 Largest Unsec. Creditors ---------------------------------------------------------------- Debtor: Western Supply Corporation dba Western Tool dba Western Tool Supply PO Box 13466 Salem, OR 97309 Bankruptcy Case No.: 09-63009 Chapter 11 Petition Date: June 9, 2009 Court: United States Bankruptcy Court District of Oregon Judge: Albert E. Radcliffe Debtor's Counsel: Howard M. Levine, Esq. 1000 SW Broadway #1400 Portland, OR 97205 Tel: (503) 243-1637 Email: howard@sussmanshank.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/orb09-63009.pdf The petition was signed by Kevin Kiker, president of the Company. WILLIAM LYON: Moody's Affirms Corporate Family Rating at 'Caa2' --------------------------------------------------------------- Moody's Investors Service affirmed William Lyon's corporate family rating of Caa2 and changed its probability of default rating to Caa2/LD from Ca, following the company's announcement that its tender offer, which was extended to all of its senior noteholders on April 13, 2009, had expired on June 5, 2009. Subsequent to the offer, approximately $53 million (or 11%) of William Lyon's outstanding senior notes were tendered at substantial discounts to par. These transactions, considered together, constitute a distressed exchange and a limited default by Moody's definition. The LD designation signifies a limited default and also incorporates Moody's expectations of additional tender offers or open market transactions at substantial discounts to par over the next twelve months. After approximately three business days, Moody's will remove the LD designation consistent with Moody's LGD (loss given default) framework. The senior unsecured notes were restored to their pre-tender offer rating level of Caa3. The instrument-level ratings and loss given default rates (listed below) were revised in accordance with Moody's LGD framework and reflect William Lyon's capital structure on March 31, 2009, pro forma for the announced results of the tender offer. The outlook remains negative. The Caa2 corporate family rating reflects Moody's expectation that the company's cash flow from operations in 2009, in its strictest sense (i.e., without any boost from tax refunds), is likely to be only breakeven at best. In addition, covenant compliance is expected to be challenging if impairments and operating losses continue apace, which is what Moody's Corporate Finance Group is projecting for 2009, especially in light of the company's heavy concentration in California and lesser concentrations in Arizona and Nevada. Debt leverage, while reduced to 78.9% as a result of the recent tender offer, is likely to trend higher as impairment charges continue to take their toll. Furthermore, the company's lot supply, at greater than seven years, is at the higher end of the industry average while all six of the company's separate bank credit facilities expire in various months during 2009. Going forward, the ratings could come under additional pressure if the company were to begin generating substantial negative free cash flow, were to require, but be unable to attain, additional covenant relief, or were unable to renew more than a token amount of its bank credit facility. The outlook and ratings could benefit if the company were to begin generating substantial free cash flow, managed to staunch the operating losses before impairments, and began reducing debt leverage on a sustained basis. These ratings were affected: -- Corporate family rating, affirmed at Caa2; -- Probability of default rating, changed to Caa2/LD from Ca; -- Senior unsecured notes rating, changed to Caa3 (LGD5, 72%) from C (LGD5, 84%). Moody's most recent announcement concerning the ratings for William Lyon Homes was on April 16, 2009, at which time Moody's lowered its probability of default rating to Ca from Caa2 following the company's announcement on April 13, 2009, that it had commenced a cash tender whereby it would spend up to a maximum of $40 million to purchase a portion of its outstanding senior notes by May 8, 2009. Begun in 1956 and headquartered in Newport Beach, California, William Lyon Homes designs, builds, and sells single family detached and attached homes in California, Arizona and Nevada. Consolidated homebuilding revenues and net income including charges for the twelve months ended March 31, 2009 were approximately $458 million and $(180) million, respectively. * Berger Singerman Gets Top Ranking in Chambers USA 2009 Guide -------------------------------------------------------------- Berger Singerman has been ranked among the top rated law Florida firms in Chambers USA 2009 America's Leading Business Lawyers in the bankruptcy/restructuring category. Chambers' researched rankings and editorials are referred to extensively by general counsel and other purchasers of legal services worldwide who consider Chambers assessments when choosing counsel. This is the sixth consecutive year in which the firm has received a first tier rating for its bankruptcy and reorganization practice and has been included in the guide. Berger Singerman shareholders Brian Gart, Jordi Guso, Brian Rich, Paul Steven Singerman, and Arthur Spector also received individual recognitions. Paul Steven Singerman received a star ranking, the highest ranking given by Chambers USA. "Inclusion in Chambers USA is based on feedback from both clients and other attorneys, and it is a true honor to receive this recognition," said Berger Singerman. "I am extremely proud of the talent and passionate commitment to client service of our entire team." This is the sixth annual Chambers USA guide of the best law firms and lawyers published by the illustrious London-based Chambers & Partners. Chambers & Partners publishes similar U.K. and Global guides which are widely respected. Research is conducted via in- depth telephone interviews with clients and with attorneys, each one lasting about half an hour. The qualities on which the rankings are assessed include technical legal ability, professional conduct, client service, commercial awareness/astuteness, diligence, commitment, and other qualities most valued by the client. Berger Singerman is a Florida business law firm with more than 60 attorneys working out of offices in Boca Raton, Fort Lauderdale, Miami and Tallahassee. Members of the firm have expertise in many areas of commercial law, including banking, creditors' rights, business reorganization, bankruptcy, corporate & securities, dispute resolution and litigation, white collar crime, real estate, environmental and land use, health care, tax, estate planning, and probate. * Focus Management Group Is Finalist in Turnaround Atlas Awards --------------------------------------------------------------- Focus Management Group has been selected as a finalist in the Global M&A Network's Turnaround Atlas Awards in two categories, including Turnaround Consulting Practice of the Year. Focus was also recognized as a finalist in the Food & Beverage Sector Deal of the Year category for its role as Chief Restructuring Officer to Archway and Mother's Cookie Company, Inc., a leading producer of cookies in the United States. A Focus team, led by Managing Director Jeffrey Granger, led the Company through a rapid Chapter 11 bankruptcy filing and prepared the entity for its subsequent sale in just 75 days, thereby preserving the value of the enterprise to the new buyer. The M&A Atlas Awards program spotlights and honors leaders, significant transactions, sought-after dealmakers and outstanding institutions in the turnaround and bankruptcy management, mergers and acquisitions, alternative investing and related industry participants. The winners will be announced at an awards gala dinner on June 22, 2009, at Hotel Allegro in Chicago, IL. "Focus Management Group is very proud to be recognized by the Global M&A Network for our accomplishments," said J. Tim Pruban, President of Focus Management Group. "Our firm has experienced unprecedented growth in the past year, and the success of the Archway engagement demonstrated the expertise of our firm's professionals in business restructuring and bankruptcy management." Focus Management Group -- http://www.focusmg.com/-- provides nationwide professional services in turnaround management, insolvency proceedings, business restructuring and operational improvement with a senior-level team of 120 professionals. Headquartered in Tampa, FL, with offices in Atlanta, Chicago, Cleveland, Greenwich, Los Angeles and Nashville, the firm provides a full portfolio of services to distressed companies and their stakeholders, including secured lenders and equity sponsors. * Getzler Henrich Forms Affiliation With Prolman Associates ----------------------------------------------------------- Turnaround firm Getzler Henrich & Associates LLC has formed a strategic affiliation with Prolman Associates. Prolman will provide GH&A with an enhanced national presence through increased West Coast exposure as well as added diversity of expertise in corporate growth and restructuring. The affiliation provides Prolman, regionally headquartered in San Diego, with GH&A's national presence in the turnaround and restructuring arena, and a depth of expertise in many industries on a national scale. In addition to San Diego, Prolman has offices in Los Angeles, and Irvine CA and has been in operation since 1987. "Prolman's disciplined methodologies and approaches to problem solving processes are a great complement to our extensive track record in operations restructuring, financial restructuring, bankruptcy advisory services, and performance improvement," said Bill Henrich, vice chairman of Getzler Henrich. David Prolman, president of Prolman Associates added, "Getzler Henrich's admirable reputation and national name recognition within our industry presents us the opportunity to provide clients with unparalleled service and expertise. We are looking forward to working together." Mr. Henrich said, "In addition to Prolman's many years of corporate restructuring experience with services that parallel those of Getzler Henrich, this affiliation allows access for all of Getzler Henrich's clients to Prolman's hallmark "Corporate Growth Management" services. Prolman's signature delivery of 'Accelerating Execution in Urgent Times' is particularly appropriate in the current economic environment." Prolman's Corporate Growth management services include the Firm's WorkSmart, and Accelerating Change and Transition as well as Lean and Six Sigma processes. These are processes providing "A set of disciplines and approaches for business of all sizes in any industry". The company includes 25 restructuring and corporate growth professionals, with expertise across industries including specializations in the retail sector and quick service & casual dining restaurants. "Prolman's highly collaborative team is committed as we are to providing our clients with value creation and performance improvement," said Joel Getzler, vice chairman of Getzler Henrich. "Combined, our people and services enable us to offer our clients best practices in all our specialty areas," he added. Getzler Henrich & Associates LLC -- http://www.getzlerhenrich.com -- founded in 1968, is one of the nation's oldest and most respected names in middle market corporate turnaround and restructuring. Having successfully restructured thousands of companies throughout the U.S., Latin America and Asia, the firm has grown to provide a broad array of services for both distressed and healthy companies in the areas of restructuring and turnarounds, lean manufacturing, sales and marketing strategy, M&A integration, technology systems evaluation and implementation and customer-focused environment creation. Long respected for its results-oriented approach, Getzler Henrich deploys rapid, pragmatic decision making and metrics-driven implementation services for its clients. With years of experience in executive-level positions at major corporations, and a broad range of advisory expertise, Getzler Henrich professionals have consistently and successfully guided companies through crises and growth phases with this methodology. Working with a wide range of companies, including publicly-held firms, private corporations, and family-owned businesses, Getzler Henrich expertise spans more than fifty industry sectors, from 'old economy' manufacturing and distribution businesses, to 'new economy' technology and service firms. * Matthew Salerno Joins McDonald Hopkins' Cleveland Office ---------------------------------------------------------- Matthew A. Salerno has joined the Cleveland office of McDonald Hopkins LLC as a member in the firm's Business Restructuring Department. Mr. Salerno adds to the strength of the Department, which is one of the largest and most sophisticated bankruptcy and restructuring practices in the Great Lakes region. Mr. Salerno counsels clients in diverse industries including manufacturing, automotive and real estate. He represents parties in Chapter 11 bankruptcy proceedings; corporate reorganizations and workouts; state-related insolvency proceedings, and various commercial matters. Mr. Salerno works with debtors, creditors' committees and trustees in Chapter 11 bankruptcies; sellers and buyers in distressed business dispositions and acquisitions; court-appointed receivers; and businesses in commercial actions. "We are very pleased that Matt has rejoined our restructuring team," said Shawn M. Riley, Co-Chair of the firm's Business Restructuring Department. "Our bankruptcy and restructuring expertise is needed more than ever during these challenging times and Matt further strengthens our depth in this area," Mr. Riley said. Mr. Salerno received his Juris Doctor from Case Western Reserve University School of Law and a Bachelor of Arts degree with honors from The Ohio State University. He serves as the Chairman of the Lake Erie Swimming Board of Review, is a member of the Hawken School Alumni Board; and is adjunct faculty at Case Western Reserve University School of Law. * BOOK REVIEW: Crafting Solutions for Troubled Businesses: A Disciplined Approach to Diagnosing and Confronting Management Challenges ----------------------------------------------------------------- Authors: Stephen J. Hopkins and S. Douglas Hopkins Publisher: Beard Books Hardcover: 314 pages List price: $74.95 Review by John F. Wall So, the first thing to do when dealing with a troubled business is to find the guilty and lop someone's head off! Don't be so quick to react, advise co-authors Stephen J. Hopkins and S. Douglas Hopkins in their thoughtful, well-researched book, Crafting Solutions for Troubled Businesses. The father-son team of Steve and Doug Hopkins are principals of Kestrel Consulting, LLC, a firm they founded in March 2004. Each has more than 25 years of experience working with troubled businesses and providing turnaround advisory and interim management services. Steve got his first taste of a troubled business when, as CFO of an 80-year-old chemical company, Bill Nightingale of Nightingale & Associates assisted him in taking the company through a Chapter 11 filing. The company subsequently emerged from bankruptcy with payment in full to all creditors. Steve then joined Nightingale, staying for 23 years and serving initially as a principal and eventually as president from 1994 to 2000. Doug began working at Nightingale in 1978 as a part-time resource for special projects. After working in this capacity for 10 years, Steve joined Nightingale full time in the late 1980s and became a principal in 1994. Both Steve and Doug have served in various C-level roles in troubled companies, including CEO, CFO, COO, and CRO. To write this book, the Hopkinses drew upon their vast experience in dealing with troubled companies. They took 100 of the largest projects they have been involved in and applied a "disciplined analysis" to diagnose problem situations and produce successful outcomes. These projects -- helpfully set apart by shaded boxes - - demonstrate the authors' theories and methods in dealing with troubled businesses. The authors also analyze some well-known cases like Enron, WorldCom, and Sunbeam to help the reader connect the dots in a very real sense and use the book for actionable advice. The book is divided into five parts: 1) Conceptual Approach and Key Issues, 2) Managing the Crisis, 3) The Diagnosis Process, 4) Alternatives and Action Plans, and 5) Lessons Learned in 100 Completed Assignments. Each part has multiple chapters expanding on these themes, and each chapter concludes with a recap of what was discussed. For speed readers and the time crunched, these recaps are an excellent way of extracting from the book the essence of what the authors are advocating. So what about lopping off that head? The authors contend that management's role is much less pivotal than is commonly believed. The real issue when working with a troubled business is determining the viability of the business. To do that, the underlying causes must be identified at different stages of the corporate lifecycle. The authors categorize troubled businesses as Undisciplined Racehorses, Overburdened Workhorses, and Aging Mules. Only through a step-by-step diagnosis can the core problems be dealt with. Pursuing a turnaround may not always be a viable and, in fact, in only one-third of the 100 cases the authors worked on did the company achieve a true operational turnaround. Crafting Solutions for Troubled Businesses should be on the must- read list of anyone involved in dealing with, consulting for, or operating a troubled business. John Wall is a Managing Director of NachmanHaysBrownstein, Inc. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com/ On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. For copies of court documents filed in the District of Delaware, please contact Vito at Parcels, Inc., at 302-658-9911. For bankruptcy documents filed in cases pending outside the District of Delaware, contact Ken Troubh at Nationwide Research & Consulting at 207/791-2852. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Ma. Theresa Amor J. Tan Singco, Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2009. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***