/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/090623.mbx T R O U B L E D C O M P A N Y R E P O R T E R Tuesday, June 23, 2009, Vol. 13, No. 172 Headlines 1226 ALKI: Voluntary Chapter 11 Case Summary 222 SOUTH CALDWELL: Proceeds From Foreclosure Action to Go to BB 36 ACRES: Case Summary & 7 Largest Unsecured Creditors ABSPOKE 2005: S&P Downgrades Ratings on 2005-IC Notes to 'D' ACCESS PHARMACEUTICALS: Reduces Nowotnik, Thompson Salaries AFFINITY GROUP: S&P Downgrades Corporate Credit Rating to 'SD' ALLIS-CHALMERS: Extends Expiration of Tender Offers for Sr. Notes AMACORE GROUP: US Health Deal Revised; Purchase Price Cut to $4MM AMERICAN COMMUNITY: Files Schedules of Assets and Liabilities AMERITEX TECHNOLOGIES: Case Summary & 20 Largest Unsec. Creditors ANCHOR BLUE: Closing 46 Underperforming Stores ANEKONA W: U.S. Trustee Schedules Meeting of Creditors for July 6 APPLIANCES RECOVERY: Case Summary & 12 Largest Unsecured Creditors ANTHRACITE CAPITAL: Gets 30-Day Waiver From BlackRock Holdco AVONDALE GATEWAY: 6 Largest Unsecured Creditors AVONDALE GATEWAY: Proposes Polsinelli Shughart as Counsel BAUSCH & LOMB: S&P Affirms Corporate Credit Rating at 'B+' BEARINGPOINT INC: Delays Cash Use Motion After Objection BEARINGPOINT INC: Wants Plan Filing Period Extended to October 16 BERNARD KOSAR: Files for Chapter 11 Bankruptcy Protection BERNARD KOSAR: Case Summary & 20 Largest Unsecured Creditors BERNARD MADOFF: SEC Charges Madoff Solicitors, Feeder With Fraud BERNARD MADOFF: Trustee Sues Cohmad to Avoid $100MM in Deals BRIGETTE MILLER LEVY: Case Summary & 5 Largest Unsecured Creditors BRITANNIA BULK: Holdings Seeks Chapter 15 Creditor Protection BROOKE CORP: Ch 11 Trustee Seeks to Block Founder's Bankruptcy CAJUN FUNDING: Church's Chicken Sale Won't Move Moody's B2 Rating CANADIAN SUPERIOR: Agrees to Business Combination With Challenger CAPITAL CORP: U.S. Trustee Appoints 3 Members to Creditors Panel CARAUSTAR INDUSTRIES: Court OKs Deloitte as Auditor and Consultant CARAUSTAR INDUSTRIES: King & Spalding Approved as Counsel CARLOS PEREZ: Case Summary & 17 Largest Unsecured Creditors CATHERINE QUAIL: Voluntary Chapter 11 Case Summary CHALLENGER ENERGY: Agrees to Merger With Canadian Superior CHENIERE ENERGY: Registers $38.3MM Shares Under Incentive Plan CHINA DIGITAL: Goodbye Kabani, Hello Goldman Parks CHRISTOPHER BELL: Case Summary & 18 Largest Unsecured Creditors CJH DEVELOPMENT: Case Summary & Largest Unsecured Creditor COMPLICATED LLC: Voluntary Chapter 11 Case Summary CONGOLEUM CORPORATION: Amends Business Relations Deal with ABI CONSECO INC: Risk-Based Capital Ratio Benefits Under NAIC Action COYOTES HOCKEY: Geographic Restriction in Contract Upheld CRITICAL ACCESS: Files for Chapter 11 Bankruptcy Protection CRYSTAL GARDEN: Seeks to Employ Wright Ginsberg as Counsel DAN RIVER: PBGC Assumes Underfunded Pension Plans E*TRADE FINANCIAL: Offers Zero Coupon Bonds for High-Yield Notes E*TRADE FINANCIAL: S&P Cuts Counterparty Credit Rating to 'CC' EASTBROOKE HOMES: Case Summary & 20 Largest Unsecured Creditors EDDIE BAUER: Receives Notice of Delisting From Nasdaq EDJ LLC: Case Summary & 5 Largest Unsecured Creditors EDRA BLIXSETH: Has Until June 29 to Decide on Assets EMIGRANT BANCORP: Fitch Downgrades Issuer Default Ratings to 'B-' ENVISION HOSPITALS: Failed Hospital Investment Led to Ch 7 Filing EXACT SCIENCES: Inks License Agreement with MAYO Foundation EXACT SCIENCES: Sells Shares to Investors; Raises $8.2MM EXTENDED STAY: Creditors Panel Taps Hahn & Hessen as Counsel EXTENDED STAY: Judge Peck to Hold Initial Case Conference July 13 EXTENDED STAY: $4.1BB in CMBS to Complicate Bankruptcy Case EXTENDED STAY: Gets Interim Approval to Use Cash Collateral EXTENDED STAY: Gets Interim Approval to Reimburse HVM FINLAY ENTERPRISES: In Default Under GECC Revolving Loan FIRSTFED FINANCIAL: Offers 20 Cents on the Dollar for Debentures FIRSTGOLD CORP: Working With Advisors to Restructure Company FLYING J: Magellan Selected as Lead Bidder of Longhorn Partners FORD MOTOR: Denies Reaching Tentative Deal With Geely for Volvo FRAMINGHAM ACQUISITIONS: Files for Chapter 11, Dodges Foreclosure FRONTIER AIRLINES: Files Plan; to Become Subsidiary of Republic GBF ENTERPRISES: Case Summary & 12 Largest Unsecured Creditors GEORGE LIGON DUNN: Case Summary & 13 Largest Unsecured Creditors HANGER ORTHOPEDIC: S&P Lifts Ratings to 'B+'; Gives Stable Outlook HARTWICK COLLEGE: Moody's Keeps 'Ba1' Rating on Outstanding Bonds HATTIE SCHERBACK: Seeks to Employ Michael Mitchell as Counsel HAWAII SUPERFERRY: Seeks Pepper Hamilton as Counsel HAWAII SUPERFERRY: State of Hawaii Seeks Transfer of Venue HAWAII SUPERFERRY: Taps Blank Rome & Goodsill as Special Counsels HAWAIIAN TELCOM: Kirkland Bills $2.5MM for Dec.-to-March Work HAYES LEMMERZ: Incurs $58.5-Mil. Net Loss for Qrtr Ended April 30 HENRY DUNAY: Files Bare-Bones Chapter 11 Petition HERBST GAMING: Files Joint Plan of Reorganization in Nevada HOVNANIAN ENTERPRISES: Unit Commences Cash Tender Offers INDALEX HOLDINGS: Committee Objects to Bonus Plan for Management INNOVATIVE COS: Can Use Citibank Cash Collateral Until June 30 INNOVATIVE COS: Files Schedules of Assets and Liabilities INTERMET CORP: Plan Set for July 14 Confirmation Hearing ISOLAGEN INC: Agrees to Restructuring Plan with Stakeholders ISOLAGEN INC: NYSE Amex to Delist Stock Effective June 29 JOHN DIXON: Case Summary & 15 Largest Unsecured Creditors JOSEPH ALFARO: Case Summary & 20 Largest Unsecured Creditors KHAN GUL: Case Summary & 5 Largest Unsecured Creditors KV PHARMACEUTICAL: Form 10-K Filing Delay Prompts NYSE Monitoring LAND RESOURCE: Wants Case Converted to Chapter 7 Liquidation LARGE CARTAGE: Case Summary & 20 Largest Unsecured Creditors MAHALO ENERGY: Court Denies Secured Lenders-Led Sale Process MANTUA LAND: Case Summary & Largest Unsecured Creditor MATRIX DEVELOPMENT: Court Declines to OK Disclosure Statement METROMEDIA INT'L: Files $140MM Malpractice Suit Against Paul Weiss MICHAEL PYLMAN: Filed Ch. 11 to Stop Sale of Cow Herd MICHAEL VICK: Court Rejects Plan; Loses Peter Ginsberg as Counsel MSB ENERGY: Seeks to Employ Landauer and Ungerman as Counsel MERISANT WORLDWIDE: Wants to Implement Employee Severance Plan MOTOR COACH: Challenges Committee Professionals' Fees MOTOR COACH: Creditors Panel Supports HSBC's $237,589 Admin. Fees MUELLER WATER: S&P Affirms Corporate Credit Rating at 'B' NORTHFIELD LABORATORIES: Proposes Baker & McKenzie as Counsel NORTHFIELD LABORATORIES: Winding Down; to Sell De Minimis Assets NOVEMBER 2005: Wants Snell & Wilmer to Assist in Land Use Matters OXFORD SQUARE HOLDINGS: Voluntary Chapter 11 Case Summary PACIFIC CAPITAL: Defers Interest Payments on Trust Preferreds PACIFIC ENERGY: Union Oil Sues to Pursue Rights to Oil Fields PACIFIC ENERGY: Gets Final OK to Obtain DIP Facility from Lenders PALM VILLAGE: Seeks to Employ GSGH as Bankruptcy Counsel PARKSIDE VILLAGE: Files for Chapter 11 Bankruptcy Protection PATHEON INC: S&P Gives Stable Outlook; Affirms 'B+' Corp. Rating PAUL MOLLER: Files for Chapter 11 Bankruptcy Protection PDC LOVELESS: Case Summary & 19 Largest Unsecured Creditors PDCC DEVELOPMENT: Case Summary & 20 Largest Unsecured Creditors PENINSULA CLEAR: Section 341(a) Meeting Scheduled for July 14 PENTON BUSINESS: Weak Performance Cues S&P to Junk Corp. Rating POMARE LTD: Files Plan to Stop Sale to Maui Divers PRELUDE INVESTMENT: Voluntary Chapter 11 Case Summary PRIME CAROLINA: Case Summary & 20 Largest Unsecured Creditors PROPEX INC: Files New Version of Liquidating Plan PROPEX INC: Treatment of Claims Under Liquidation Plan PROPEX INC: Seeks Approval of Disclosure Statement PROPEX INC: Seeks to Set July 31 as Admin. Claims Bar Date PROPEX INC: Changes Name to Fabrics Estate Following Xerxes Sale PROSPECT HOMES: Proposes as DurretteBradshaw Counsel PROSPECT HOMES: Proposes to Sell Richmond Property for $364,000 PROTEIN SCIENCES: Sent to Chapter 7 Bankruptcy by Creditors PROVIDENT ROYALTIES: Files for Chapter 11 in Dallas PUB PROPERTIES: Voluntary Chapter 11 Case Summary PUNTO VERDE: S&P Affirms 'BB' Rating on $40 Mil. Taw-Exempt Notes QUEBECOR WORLD: Plan Confirmation Hearing on June 30 QUEBECOR WORLD: SocGen (Canada), et al., Object to Plan QUEBECOR WORLD: Seeks Continuance of MICP Until 2009 QUEST RESOURCE: Going Concern Doubt Raised; Warns of Bankruptcy QVC INC: Moody's Assigns Corporate Family Rating at 'Ba2' R3 FOOD: Sale Hearing on June 29 & Claims Due by Sept. 30 RAP VENTURES: Case Summary & 6 Largest Unsecured Creditors REAL MEX: Moody's Assigns 'B3' Rating on Senior Secured Notes ROBERT ORR: Albert Reidere Seeks to Block Bankruptcy Protection SEARS CANADA: Moody's Downgrades Senior Unsecured Notes to 'Ba1' SHERIDAN GROUP: S&P Affirms Corporate Credit Rating at 'B' SILVER CLUB: Case Summary & 20 Largest Unsecured Creditors SINCLAIR BROADCAST: S&P Downgrades Corporate Credit Rating to 'B+' SIRVA INC: To Settle Multidistrict Litigation for $3 Million SOLO CUP: Moody's Assigns 'Ba2' Rating on New Asset-Based Revolver SONORAN ENERGY: Case Summary & 20 Largest Unsecured Creditors SPANSION INC: Seeks to Reject Contract with Market Street SPANSION INC: Seeks Approval of UBS Bank USA Settlement SPANSION INC: Samsung Wants Stay Lifted for Suit to Continue SPANSION INC: Mathers Requests for Equity Holders Committee SPARTON CORPORATION: National City Note Extended to August 15 STANDARD MOTOR: S&P Withdraws 'CC' Corporate Credit Rating STAR TRIBUNE: Plan Offers Up to 36% Recovery for 1st Lien Lenders STILA CORP: Creditors File Involuntary Ch 7 Petition Against Co. TELEPLUS WORLD: Court Appoints Interim Receiver for Operating Arms TOUSA INC.: Tax Refund Pledged to Lender Subject to Attack TRIBUNE CO: Seeks to Employ Ernst & Young for Valuation Services TRIBUNE CO: Seeks Nov. 3 Extension of Deadline to Remove Actions TRIBUNE CO: Seeks to Assume 225 Unexpired Leases TRIBUNE CO: In Negotiations With Bank Lenders on Ch. 11 Plan TRIBUNE CO: Revised Schedules Of Assets And Liabilities TXP CORPORATION: Voluntary Chapter 11 Case Summary VIRGIN MOBILE: Registers $18,950,000 Shares Under Incentive Plan VISANT HOLDING: S&P Raises Corporate Credit Rating to 'BB-' WADE INVESTMENTS: Case Summary & 4 Largest Unsecured Creditors WCI COMMUNITIES: Court Approves $14.6MM Sale of Regent Bal Harbour WEDGE ENERGY: To File Financial Reports by Month's End WHALEY PARTNERS: Case Summary & 20 Largest Unsecured Creditors WILLIAM THIELE: Case Summary & 20 Largest Unsecured Creditors YOUNG BROADCASTING: Bid Deadline Extended to July 10 YPG HOLDINGS: S&P Assigns 'BB+' Rating on Subordinated Debt * 151 Sidley Lawyers Recognized in Chambers USA * Tom Behnke Joins Alvarez & Marsal as Senior Director * Automobile Dealers, Nursing Homes, Hotels Prone to Bankruptcy * Year-Ended-May 2009 Consumer Price Index Decline Most in 60 Yrs * Large Companies With Insolvent Balance Sheets ********* 1226 ALKI: Voluntary Chapter 11 Case Summary -------------------------------------------- Debtor: 1226 Alki Avenue SW, LLC 2621 Eastlake Ave. East Seattle, WA 98102 Bankruptcy Case No.: 09-16026 Chapter 11 Petition Date: June 19, 2009 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 Estimated Assets: $10 million to $50 million Estimated Debts: $1 million to $10 million The Debtor did not file a list of 20 largest unsecured creditors. The petition was signed by John Downing. 222 SOUTH CALDWELL: Proceeds From Foreclosure Action to Go to BB ---------------------------------------------------------------- Susan Stabley at Charlotte Business Journal reports that the Hon. J. Craig Whitley of the U.S. Bankruptcy Court for the Western District of North Carolina has ruled that proceeds from the foreclosure auction of 222 South Caldwell Street Limited Partnership's The Park will be credited to BB Syndication Services Inc., the lender that foreclosed on the property. Business Journal states that BB Syndication bought the building for $14.2 million in a public auction in December 2008. According to Business Journal, Judge Whitley ruled that BB Syndication held the primary lien on the property, ahead of dozens of unpaid contractors and contract holders who lost their deposits, leaving no funds to be paid to the other claimants from the property sale. BB Syndication, says Business Journal, will auction off The Park on July 22. Court documents say that BB Syndication has a $16 million claim against Pete Verna, 222 South Caldwell's owner who also filed for Chapter 7 personal bankruptcy. According to Business Journal, a meeting of creditors is scheduled for July 1 at 11:00 a.m. 222 South Caldwell Street Limited Partnership is a North Carolina limited partnership. C.P. Buckner Steel Erection Inc., Southern Steel Co., and Gary Williams jointly filed a petition in U.S. Bankruptcy Court to put 222 South Caldwell under Chapter 7 liquidation, claiming a total of $1.85 million against the Debtor. 36 ACRES: Case Summary & 7 Largest Unsecured Creditors ------------------------------------------------------ Debtor: 36 Acres At Santa Rita, LLC 4423 N. Osage Dr. Tucson, AZ 85718 Bankruptcy Case No.: 09-13918 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. ------ -------- Corona De Tucson Development Group, LLC 09-13920 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of Arizona (Tucson) Judge: Eileen W. Hollowell Debtor's Counsel: Eric Slocum Sparks, Esq. 110 S Church Ave #2270 Tucson, AZ 85701 Tel: (520) 623-8330 Fax: (520) 623-9157 Email: eric@ericslocumsparkspc.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 7 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/azb09-13918.pdf The petition was signed by James F. Simpson, member and manager of the Company. ABSPOKE 2005: S&P Downgrades Ratings on 2005-IC Notes to 'D' ------------------------------------------------------------ Standard & Poor's Ratings Services lowered its rating on the fixed-rate notes issued by ABSpoke 2005-IC Ltd. to 'D' from 'CCC-'. The lowered rating follows a number of recent write-downs of the underlying reference entities, which have caused the notes to incur a partial principal loss. ACCESS PHARMACEUTICALS: Reduces Nowotnik, Thompson Salaries ----------------------------------------------------------- Access Pharmaceuticals, Inc., entered into a transition services agreement with Dr. David Nowotnik, Senior Vice President, Research and Development, pursuant to which Access and Dr. Nowotnik agreed to a salary reduction to $10,000 per month in exchange for an additional grant of options to purchase 75,000 shares of the Company's common stock at an exercise price equal to the fair market value of the shares on the grant date which vest ratably over a six-month term. As a result of entering into the Transition Services Agreement, Dr. Nowotnik remains an executive of Access but the Employment Agreement, dated as of November 16, 1998 which was previously entered into between Access and Dr. Nowotnik is no longer in effect. This constitutes a step in Access' ongoing efforts to conserve its cash resource while continuing to work toward executing its business strategy. Access also entered into a transition services agreement with Stephen Thompson, Chief Financial Officer, pursuant to which Access and Mr. Thompson agreed to a salary reduction to $7,500 per month in exchange for an additional grant of options to purchase 75,000 shares of the Company's common stock at an exercise price equal to the fair market value of the shares on the grant date which vest ratably over a six-month term. As a result of entering into the Transition Services Agreement, Mr. Thompson remains an executive of Access but the Employment Agreement, dated as of June 24, 2005, which was previously entered into between Access and Mr. Thompson is no longer in effect. This constitutes a step in Access' ongoing efforts to conserve its cash resource while continuing to work toward executing its business strategy. About Access Pharmaceuticals Headquartered in Dallas, Texas, Access Pharmaceuticals Inc. (OTC BB: ACCP.OB) -- http://accesspharma.com/-- is an emerging biopharmaceutical company developing products for use in the treatment of cancer, the supportive care of cancer, and other disease states. The company's product for the management of oral mucositis, MuGard(TM) has received marketing clearance by the FDA as a device. The company's lead clinical development program for the drug candidate ProLindac(TM) is in Phase II clinical testing. Access also has advanced drug delivery technologies including Cobalamin(TM) mediated oral drug delivery and targeted delivery. Going Concern Doubt On March 31, 2008, Whitley Penn LLP, in Dallas, expressed substantial doubt about Access Pharmaceuticals Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended Dec. 31, 2007 and 2006. The auditing firm pointed to the company's recurring losses from operations, negative cash flows from operating activities and an accumulated deficit. AFFINITY GROUP: S&P Downgrades Corporate Credit Rating to 'SD' -------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on Ventura, California-based direct marketing company Affinity Group Holding Inc. and its operating subsidiary, Affinity Group Inc. to 'SD' from 'CCC'. In addition, S&P lowered the issue-level rating on the operating company's 9% senior subordinated notes to 'D' from 'CCC'. The recovery rating on this debt remains unchanged at '5', indicating S&P's expectation of modest (10% to 30%) recovery for noteholders in the event of a payment default. Other outstanding ratings on Affinity Group's debt remain unchanged. The company had $412.6 million of debt outstanding as of March 31, 2009. The ratings downgrade follows the company's recent announcement on June 5, 2009 that it obtained a $9.7 million second-lien loan (unrated) and used the proceeds to purchase $14.6 million principal amount of its 9% senior subordinated notes due 2012. "We have deemed the transaction as distressed and, thus, tantamount to a default as per our criteria," noted Standard & Poor's credit analyst Tulip Lim. "We have taken this view because bondholders will be receiving less than par value for the notes and because of the company's highly leveraged financial profile, weak operating outlook, and limited liquidity given the near-term maturity of its senior credit facility." Affinity Group amended its credit agreement to revise the financial covenants and extend the maturity of its credit facilities, which were set to expire on June 24, 2009 to March 31, 2010. Although the company was successful in extending its maturities for the secured credit facilities, S&P believes that near-term refinancing risk still exists. Affinity Group is a direct marketer and retailer targeting North American RV owners and outdoor enthusiasts. The retail segment has been unprofitable over the past few quarters and continues to be a drag on the company's overall profitability. The company has experienced deterioration in profitability over the past several quarters from weakening consumer discretionary spending, especially for big-ticket items and lower advertising spending. For the 12 months ended March 31, 2009, lease-adjusted debt to EBITDA was high, at 8.0x, elevated from 7.7x at fiscal year-end 2008. The company has reduced debt subsequent to the quarter as part of the conditions of the amended credit agreement. EBITDA coverage of interest was 1.6x for the same period. Interest coverage is likely to be pressured by further EBITDA declines and higher interest expense as a result of the June 5, 2009 amendment to the credit agreement. A s a result of the amendment, the borrowing rate was increased to prime rate plus 7.0%, or LIBOR plus 8%, with a LIBOR floor of 2.75%. ALLIS-CHALMERS: Extends Expiration of Tender Offers for Sr. Notes ----------------------------------------------------------------- Allis-Chalmers Energy Inc., extended the expiration date for each of its tender offers to purchase limited amounts of its 9.0% Senior Notes due 2014 (CUSIP Number 019645 AC 4) and its 8.5% Senior Notes due 2017 (CUSIP Number 019645 AE 0). The Expiration Date of each of the tender offers, as so extended, will be 5:00 p.m., Eastern Time, on Friday, June 26, 2009, in each case, unless the tender offer is terminated earlier or its Expiration Date is extended further. Pursuant to its Offer to Purchase dated May 20, 2009, as amended, Allis-Chalmers is conducting tender offers to purchase up to a maximum acceptance amount of $75,000,000 of the 9.0% Notes and up to a maximum acceptance amount of $50,000,000 of the 8.5% Notes, in each case at a purchase price determined in accordance with the procedures of a modified "Dutch Auction." Furthermore, Allis-Chalmers is extending the Early Participation Date applicable to each of the tender offers from 5:00 p.m., Eastern Time, on June 18, 2009, to 5:00 p.m., Eastern Time, on June 26, 2009. Consequently, holders who tender their Notes of either series prior to such extended time, and have their Notes accepted by Allis-Chalmers for purchase, will be entitled to the Total Consideration for such Notes, which will include the Early Participation Payment of $20.00 per $1,000 principal amount of Notes accepted for purchase. The Withdrawal Date applicable to each of the tender offers was and will continue to be 9:00 a.m., Eastern Time, on Wednesday, June 3, 2009. Consequently, holders who tendered and did not withdraw Notes prior to that time are not entitled to withdraw such Notes, and similarly, holders of Notes tendered after the Withdrawal Date, but on or prior to the Expiration Date, may not withdraw their tendered Notes. As of 5:00 p.m., Eastern Time on June 19, 2009, Allis-Chalmers had received valid tenders of $30,562,000 aggregate principal amount of the 9.0% Notes, and $44,200,000 aggregate principal amount of the 8.5% Notes. This represents approximately 11.99% and 17.68% of the outstanding principal amount of the 9.0% Notes and the 8.5% Notes, respectively. The tender offers are conditioned upon the satisfaction or waiver of certain conditions, including Allis-Chalmers' receipt of the funds necessary to complete the tender offers from its previously announced rights offering and convertible preferred stock sale, which are each subject to certain terms and conditions. Subject to applicable law, Allis-Chalmers may terminate the tender offers at any time before the Expiration Date in its sole discretion. Allis-Chalmers has retained RBC Capital Markets Corporation to act as the dealer manager for the tender offers. Global Bondholder Services Corporation is the information agent and depositary for the tender offers. Questions regarding the tender offers should be directed to Mario Lewis at RBC Capital Markets Corporation at (212) 618-2204. Requests for documentation should be directed to Global Bondholder Services Corporation by calling toll-free (866) 794-2200 or (212) 430-3774 (for banks and brokers). About Allis-Chalmers Allis-Chalmers Energy Inc. is a Houston-based multi-faceted oilfield services company. Allis-Chalmers provides services and equipment to oil and natural gas exploration and production companies, domestically primarily in Texas, Louisiana, New Mexico, Oklahoma, Arkansas, offshore in the Gulf of Mexico, and internationally, primarily in Argentina, Brazil and Mexico. Allis-Chalmers provides directional drilling services, casing and tubing services, underbalanced drilling, production and workover services with coiled tubing units, rental of drill pipe and blow- out prevention equipment, and international drilling and workover services. * * * As reported by the Troubled Company Reporter on June 2, 2009, Moody's Investors Service downgraded Allis-Chalmers Energy's Corporate Family Rating to B3 from B2, its Probability of Default Rating to B3 from B2, and its senior unsecured note ratings to Caa1 (LGD 4, 61%) from B3 (LGD 4, 61%). The ratings remain on review for further possible downgrade. The downgrade reflects weaker than expected earnings as a result of deepening sector weakness in North America, which even with lower debt levels, is expected to result in financial leverage levels that are incompatible with the prior B2 Corporate Family Rating. The ratings remain under review for downgrade reflecting the company's announcement that it is commencing a cash tender offer on its $255 million 9% senior notes due 2014 and $250 million 8.5% senior notes due 2017. The TCr said May 26, 2009, that Standard & Poor's Ratings Services said that it lowered its long-term corporate credit rating on Allis-Chalmers Energy to 'CC' from 'B'. At the same time, S&P lowered the ratings on Allis' senior notes to 'CC' from 'B'. S&P also placed the ratings on CreditWatch with negative implications. AMACORE GROUP: US Health Deal Revised; Purchase Price Cut to $4MM ----------------------------------------------------------------- The Amacore Group, Inc., entered into a Stock Purchase Agreement on March 31, 2008, which was subsequently amended on April 3, 2008, with US Health Benefits Group, Inc., US Healthcare Plans, Inc., On the Phone, Inc. -- Acquired Entities -- and the sole stockholder of each of the Acquired Entities. Pursuant to the Agreement, the Company purchased of all of the outstanding capital stock of each of the Acquired Entities, effective April 1, 2008. On June 10, 2009, the Company, US Health, US Healthcare, OTP and the Stockholder entered an Amendment to Stock Purchase Agreement. Pursuant to the Amendment, the value of the Acquired Entities has been reduced from $14,300,000 to $4,331,663.75. The Amended Purchase Price will be payable as: -- As of the Amendment Closing, the Company has paid the Stockholder the aggregate sum of $2,191,663.75, which amount will be deemed a reduction in the Amended Purchase Price; -- Upon the Amendment Closing, the Company paid the Stockholder $737,500.00; -- Upon the Amendment Closing, the Company issued an aggregate of 1,800,000 shares of the Company's Class A common stock, which for purposes of the Amendment were valued at $0.05 per share or $90,000. This amount will also be treated as a reduction to the Amended Purchase Price; and -- Upon the Amendment Closing, the Company issued a Promissory Note to the Stockholder in the principal amount of $1,312,500.00 with an interest rate of 3.25% per annum, payable over a three-year term. In addition to the terms, the Amendment also contains certain additional customary representations, warranties, covenants and indemnification provisions. In connection with the Amendment, the Company and US Health entered into an Employment Agreement with Howard Kastner, pursuant to which Mr. Kastner agreed to serve as the Company's Senior Vice President of Marketing. The Employment Agreement has a term of three years. During the first year of the Employment Agreement, Mr. Kastner will receive compensation of $100,000. His compensation for years two and three will be negotiated between the parties one month prior to the conclusion of each year. Mr. Kastner will also be entitled to reasonable paid vacation time, sick leave and time to attend professional. In addition to his base salary, Mr. Kastner will also be eligible to receive performance incentive bonuses during the term of the Employment Agreement. Further, Mr. Kastner will receive commissions on sales of certain products of the Company in accordance with the terms of the Employment Agreement. About Amacore Group Based in Tampa, Florida, The Amacore Group Inc. (OTC BB: ACGI) -- http://www.amacoregroup.com/-- provides health-related membership benefit programs, insurance programs, and other innovative and high-quality solutions to individuals, families and employer groups nationwide. Through its wholly owned subsidiary, LifeGuard Benefit Solutions Inc., Amacore now has the ability to provide administrative and back-office services to other healthcare companies in addition to expanding its own call center capability through its wholly-owned subsidiary, JRM Benefits Consultants LLC and US Heath Benefits Group Inc., a call center-based marketing company. Zurvita Inc., Amacore's newly formed, wholly-owned subsidiary specializing in direct to consumer multi-level marketing, provides yet another channel for Amacore's ever-increasing range of healthcare and healthcare-related products. At March 31, 2009, the Company's balance sheet showed total assets of $19.6 million and total liabilities of $23.1 million, resulting in a stockholders' deficit of about $3.5 million. Going Concern Doubt McGladrey & Pullen, LLP, in Ft. Lauderdale, raised substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial results for for the year ended December 31, 2008. The auditors pointed that the Company has suffered recurring losses from operations and has negative working capital. AMERICAN COMMUNITY: Files Schedules of Assets and Liabilities ------------------------------------------------------------- American Community Newspapers LLC and its affiliates filed with the U.S. Bankruptcy Court for the District of Delaware, their schedules of assets and liabilities, disclosing: Name of Debtor Assets Liabilities -------------- ----------- ------------ American Community Newspapers LLC $17,858,566 $112,893,707 Amendment One, Inc. $882,713 $111,338,003 Leesburg Today, Inc. $0 $111,032,000 Loudoun Business, Inc. $0 $111,032,000 Loudoun Magazine, Inc. $0 $111,032,000 American Community Newspapers Inc $0 $39,977,555 Copies of American Community Newspapers LLC, et al.'s Schedules are available at: http://bankrupt.com/misc/ACNLLC.SAL.pdf http://bankrupt.com/misc/amendmentone.SAL.pdf http://bankrupt.com/misc/LeesburgToday.SAL.pdf http://bankrupt.com/misc/loudounbusiness.SAL.pdf http://bankrupt.com/misc/loudounmagazine.pdf http://bankrupt.com/misc/ACNInc.SAL.pdf Headquartered in Addison, Texas, American Community Newspapers LLC -- http://www.americancommunitynewspapers.com/-- claims to be one of the top community newspaper publishers in the United States based on circulation, and operates in four of the most attractive major U.S. markets: Minneapolis -- St. Paul, Columbus, Dallas -- Fort Worth and Suburban Washington, D.C. -- Northern Virginia. The Company's award winning group of 86 newspapers and fourteen niche publications reaches approximately 1.4 million households in the suburban communities surrounding these major cities and enjoys market leading circulation penetration in all of its markets. The Company and four of its affiliates filed for Chapter 11 protection on April 28, 2009 (Bankr. D. Del. Lead Case No. 09-11446). Landis Rath & Cobb LLC and Lowenstein Sandler PC represents the Debtors in their restructuring efforts. The Debtors proposed Carl Marks & Co. Inc. as financial advisor, and Graubard Miller as special corporate counsel. When the Debtors filed for protection from their creditors, they listed assets between $50 million and $100 million, and debts between $100 million and $500 million. AMERITEX TECHNOLOGIES: Case Summary & 20 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: Ameritex Technologies, Inc. 2111 58th Avenue East Bradenton, FL 34203 Bankruptcy Case No.: 09-13051 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Noel R. Boeke, Esq. Holland & Knight, LLP Post Office Box 1288 Tampa, FL 33601 Tel: (813) 227-8500 Fax: (813) 229-0134 Email: noel.boeke@hklaw.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 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/flmb09-13051.pdf The petition was signed by Don Zirkecbach, president of the Company. ANCHOR BLUE: Closing 46 Underperforming Stores ---------------------------------------------- Anchor Blue is closing 46 underperforming stores as part of its overall restructuring plan. A massive store closing sale kicked off Friday, June 19 at all stores earmarked for closing and will last until all merchandise is sold. "These strategic store closings will help us significantly improve operational performance as we proactively restructure our business to conform to today's market," said Thomas Sands, Chief Executive Officer at Anchor Blue Retail Group. "Anyone who lives near a closing store is encouraged to take advantage of the tremendous values we're offering on all merchandise during the sale." Anchor Blue has lowered prices on its entire inventory in all 46 closing stores, with savings up to 40% off regular prices. Girls can find incredible savings on everything from tops; jackets and hoodies; shorts; jeans; pants and crops; dresses; accessories; backpacks and bags; fragrances; jewelry; sunglasses; intimates; hats; shoes; and belts. Guys can find great deals on screen tees, shirts and polos; jeans; shorts; accessories; backpacks; belts and buckles; and hats. Gordon Brothers Group, a global advisory, restructuring and investment firm specializing in the retail, consumer products, real estate and industrial sectors, is running the store closing sale on Anchor Blue's behalf. The Anchor Blue stores earmarked for closing are: Mohave Crossroads Bullhead City AZ Desert Ridge Marketplace Phoenix AZ Tempe Marketplace Tempe AZ East Hills Mall Bakersfield CA Streets of Brentwood Brentwood CA Sunrise Mall Citrus Heights CA Manchester North SC Fresno CA Hanford Mall Hanford CA Del Monte Center Monterey CA Mervyn's Plaza Redwood City CA The Village at Sacramento Gateway Sacramento CA Oakridge Mall San Jose CA State Street District Santa Barbara CA Turlock TC Turlock CA County Fair Mall Woodland CA The Mall At Yuba City Yuba City CA Chapel Hills Mall Colorado Springs CO Foothills Mall Fort Collins CO Altamonte Mall Altamonte Springs FL Boynton Beach Mall Boynton Beach FL Westfield Brandon Brandon FL Westfield Countryside Clearwater FL Coral Square Coral Springs FL Edison Mall Fort Myers FL Treasure Coast Square Jensen Beach FL Lakeland Square Lakeland FL Melbourne Square Melbourne FL Coastland Center Naples FL West Oaks Mall Ocoee FL Prime Outlets Mall 2 (AB Outlet) Orlando FL Florida Mall Orlando FL Seminole TC Sanford FL Sarasota Square Sarasota FL Tyrone Square St. Petersburg FL Governor's Square Tallahassee FL University Mall Tampa FL Oglethorpe Mall Savannah GA Boise Towne Square Boise ID Town Square Las Vegas NV Newgate Mall Ogden UT University Mall Orem UT Provo TC Provo UT Red Cliffs Mall St. George UT Kitsap Mall Silverdale WA North Town Mall Spokane WA Westfield Vancouver Mall Vancouver WA As part of the bankruptcy filing, Anchor Blue reached a stalking horse agreement with Levi Strauss & Co. regarding the purchase of the Levi's & Dockers Outlet by MOST stores. Judge Peter J. Walsh has set June 26 as auction date to determine whether anyone will beat the offer from Levi Strauss to buy 73 of the 74 Levi's & Dockers Outlet by MOST stores for $72 million. Competing bids are due June 24. The hearing to approve the MOST sale will take place June 30. Anchor Blue has a separate deal deal to sell some 127 Anchor Blue stores to current management and Ableco Finance LLC, the agent for the term loan lenders. An auction to test the offer will be conducted July 27, followed by a sale approval hearing on July 30. Ableco will pay for the stores largely in exchange for secured debt, including debt provided for the Chapter 11 case. Anchor Blue has a deal for Gordon Brothers Retail Partners LLC to conduct going-out-of-business sales for the remaining stores. Under the Debtors' agreement with its stalking horse bidder for the liquidation sales, the Debtors were to receive 114% of the "aggregate Cost Value of the Merchandise" sold at the GOB sales, but only if the aggregate Cost Value is between $6.5 million and $7.5 million. If the aggregate Cost Value is outside of that range (either higher or lower), Anchor Blue's guaranteed percentage is lower. About Gordon Brothers Group Founded in 1903, Gordon Brothers Group -- http://www.gordonbrothers.com/-- is a global advisory, restructuring and investment firm specializing in the retail, consumer products, industrial and real estate sectors. Gordon Brothers Group maximizes value for both healthy and distressed companies by purchasing or selling all categories of assets, appraising assets, providing debt financing, making private equity investments and operating businesses for extended periods. Gordon Brothers Group conducts over $50 billion in transactions and appraisals annually. About Anchor Blue Retail Group Anchor Blue Retail Group is the holding company for two subsidiaries -- Anchor Blue Division and Levi's(R) & Dockers(R) Outlet by MOST Division. Anchor Blue is a specialty retailer of casual apparel and accessories for the teenage and young adult markets. Founded in 1972, the Company has 177 stores in 12 states. Anchor Blue offers a great assortment of well-priced fashion basics with West Coast style in a fun environment. MOST is an outlet store retailer that holds the exclusive U.S. license for Levi's(R) Outlet & Dockers(R) Outlet Stores. Known for its denim apparel and reasonable prices, MOST operates 74 stores across the U.S. Anchor Blue Retail Group Inc. and four of its affiliates filed for Chapter 11 protection on May 27, 2009 (Bankr. D. Del. Lead Case No. 09-11770). Chun I. Jang, Esq., and Jason M. Madron, Esq., at Richards Layton & Finger P.A., represent the Debtors' in their restructuring efforts. In its petition, Anchor Blue listed assets and debts between $100 million to $500 million. ANEKONA W: U.S. Trustee Schedules Meeting of Creditors for July 6 ----------------------------------------------------------------- The U.S. Trustee for Region 15 will convene a meeting of creditors in Anekona W, LLC's Chapter 11 case on July 6, 2009, at 2:00 p.m. The meeting will be held at the U.S. Trustee Hearing Room, 1132 Bishop Street, Suite 606, Honolulu, Hawaii. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Headquartered in Kamuela, Hawaii, Anekona W, LLC is in the Miscellaneous Personal Services, N.E.C. industry. The Company filed for Chapter 11 on May 27, 2009 (Bankr. D. Hawaii Case No. 09-01181). William H. Gilardy, Jr., AAL, ALC represents the Debtor in their restructuring efforts. The Debtor has assets and debts both ranging from $10 million to $50 million. APPLIANCES RECOVERY: Case Summary & 12 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Appliances Recovery ACTV Computers LLC 44 Commerce Street Glastonbury, CT 06033 Bankruptcy Case No.: 09-21671 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of Connecticut (Hartford) Judge: Chief Judge Albert S. Dabrowski Debtor's Counsel: Thomas J. Farrell, Esq. Levy & Droney P.C. 274 Silas Deane Highway Wethersfield, CT 06109 Tel: (860) 257-9327 ext 16 Fax: (860) 257-9324 Email: lawoffice@asilver.net Total Assets: $1,040,800 Total Debts: $361,147 A full-text copy of the Debtor's petition, including a list of its 12 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ctb09-21671.pdf The petition was signed by Danilo Rico, president of the Company. ANTHRACITE CAPITAL: Gets 30-Day Waiver From BlackRock Holdco ------------------------------------------------------------ Anthracite Capital, Inc., on June 22, 2009, received an extension of the waiver of covenant breach under its secured credit facility with BlackRock Holdco 2, Inc. BlackRock extended the waiver to June 15, then June 22 and now for a month, to July 22, 2009. Anthracite Capital said in a regulatory filing with the Securities and Exchange Commission that the recessionary economic conditions and ongoing market disruptions have had an adverse effect on the Company and the commercial real estate and other assets in which the Company has invested: -- The Company incurred net loss available to common stockholders of $258,049,000 for the year ended December 31, 2008 compared with net income of $71,854,000 for the year ended December 31, 2007, driven primarily by significant net realized and unrealized losses, the incurrence of a $165,928,000 provision for loan losses (including the establishment of a general reserve) and a loss from equity investments $53,630,000 compared with earnings of $32,093,000 in the prior year. The establishment of a general reserve for loan losses was deemed necessary given the dramatic change in the prospects for loan performance as a result of significant property value declines in the fourth quarter. The Company updates its general reserve calculation on a quarterly basis. -- The Company's unrestricted cash and cash equivalents sharply decreased to $9,686,000 at December 31, 2008 from $91,547,000 at December 31, 2007 due to, among other things, an increase in the receipt and funding of margin calls and amortization payments under the Company's secured credit facilities and reduced cash flow from investments. Unrestricted cash and cash equivalents further decreased to $3,872,000 at March 31, 2009. To secure the amendment and extension of its secured credit facilities (including repurchase agreements) in 2008 with Bank of America, Deutsche Bank and Morgan Stanley, the Company agreed not to request new borrowings under the facilities. Financings through collateralized debt obligations, which the Company historically utilized, are no longer available, and the Company does not expect to be able to finance investments through CDOs for the foreseeable future. -- The Company is currently focused on managing its liquidity and, unless its liquidity position and market conditions significantly improve, anticipates no new investment activity in 2009. In addition, the Company's Board of Directors anticipates that the Company will only pay cash dividends on its preferred and common stock to the extent necessary to maintain its REIT status until the Company's liquidity position has improved. These effects, the Company said, have led to these adverse consequences: -- The Company's independent registered public accounting firm has issued an opinion on the Company's December 31, 2008 consolidated financial statements that states the consolidated financial statements have been prepared assuming the Company will continue as a going concern and further states that the Company's liquidity position, current market conditions and the uncertainty relating to the outcome of the Company's ongoing negotiations with its lenders have raised substantial doubt about the Company's ability to continue as a going concern. The Company obtained agreements from its secured credit facility lenders and the lender under the Company's secured credit facility with BlackRock Holdco 2, Inc., on March 17, 2009 that the covenant breach caused by the going concern reference in the independent registered public accounting firm's opinion to the consolidated financial statements is permanently waived or such reference does not constitute an event of default or covenant breach under the applicable facilities. -- Financial covenants in certain of the Company's secured credit facilities include, without limitation, a covenant that the Company's net income (as defined in the applicable credit facility) will not be less than $1.00 for any period of two consecutive quarters and covenants that on any date the Company's tangible net worth will not have decreased by 20 percent or more from the Company's tangible net worth as of the last business day in the third month preceding such date. The Company's significant net loss for the year ended December 31, 2008 resulted in the Company not being in compliance with these covenants. On March 17, 2009, the secured credit facility lenders waived these covenant breaches until April 1, 2009 and subsequently extended this waiver until May 15, 2009. In addition, the Company's secured credit facility with BlackRock Holdco 2 requires the Company to immediately repay outstanding borrowings under the facility to the extent outstanding borrowings exceed 60% of the fair market value (as determined by the Company's manager, of the shares of common stock of Carbon Capital II, Inc., securing the facility. As of February 28, 2009, 60% of the fair market value of such shares declined to approximately $24,840,000 and outstanding borrowings under the facility were $33,450,000. On March 17, 2009, Holdco 2 waived this breach until April 1, 2009 and subsequently extended this waiver until May 15, 2009. Additionally, in the first quarter of 2009, Anthracite Euro CRE CDO 2006-1 plc failed to satisfy its Class E overcollateralization and interest coverage tests. As a result of Euro CDO's failure to satisfy these tests, each interest payment due to the Company, as the Euro CDO's preferred shareholder, will remain in the CDO as reinvestable cash until the tests are satisfied. However, since the Euro CDO's preferred shares were pledged to one of the Company's secured lenders in December 2008, the cash flow was already being diverted to pay down that lender's outstanding balance. -- During the first quarter of 2009, the Company received a margin call of $46,300,000 and C$5,300,000 from one of its secured credit facility lenders. On March 17, 2009, the lender waived this event of default until April 1, 2009, and subsequently extended this waiver until May 15, 2009. -- Due to current market conditions and the Company's current liquidity position, the Company's Board of Directors anticipates that the Company will pay cash dividends on its common and preferred stock only to the extent necessary to maintain its REIT status until the Company's liquidity position has improved and market values of commercial real estate debt show signs of stability. The Board of Directors did not declare a dividend on the Common Stock for the fourth quarter of 2008 since the Company estimated that its 2008 net taxable income distribution requirements under REIT rules were satisfied by distributions made for the first three quarters of 2008. The Board of Directors also did not declare a dividend on the Common Stock and the Company's preferred stock for the first quarter of 2009. To the extent the Company is required to make distributions to maintain its qualification as a REIT in 2009, the Company may rely upon temporary guidance that was issued by the Internal Revenue Service, which allows certain publicly traded REITs to satisfy their net taxable income distribution requirements during 2009 by distributing up to 90% in stock, with the remainder distributed in cash. However, the terms of the Company's preferred stock prohibit the Company from declaring or paying cash dividends on the Common Stock unless full cumulative dividends have been declared and paid on the preferred stock. At March 31, 2009, the total amount of debt owed to the Bank of America, Deutsche Bank and Morgan Stanley was $395,932,000, and $33,450,000 was owed to BlackRock Holdco 2, Inc. As of May 11, 2009, the amounts owed are $375,106,000 and $33,450,000, respectively. At March 31, 2009, the total amount owed to the Company's secured lenders was $429,382,000 versus $480,332,000 at December 31, 2008, resulting in net reduction of $50,950,000. These paydowns were funded by cash from operating activities of $46,637,000 for the three months ended March 31, 2009, and cash on hand at December 31, 2008, of $9,686,000. As reported by the Troubled Company Reporter on June 8, 2009, Anthracite Capitalsaid it has restructured a significant portion of its trust preferred securities and junior subordinated notes. Pursuant to an exchange agreement with certain holders of $135 million in trust preferred securities and the Company's EUR50 million junior subordinated notes, the Company issued $168.75 million and EUR62.5 million principal amount of new junior subordinated notes in exchange for those securities. The exchanges closed on May 29, 2009. The Company said coupons that were due April 30, 2009, on certain of the securities being exchanged were satisfied by payments at the new lower rate of 0.75% per year on the increased principal amounts. Anthracite also paid $2.0 million to cover third-party fees and costs incurred in connection with the exchanges. The Company estimated that the exchanges will result in cash savings of over $10 million and EUR2.5 million per year during the period that the lower coupons are in effect. The Company intends to use cash from these savings for general corporate purposes and to reduce indebtedness under its senior secured credit facilities. On May 27, 2009, in a privately negotiated exchange transaction with a holder of Anthracite's 11.75% Convertible Senior Notes due 2027, the Company issued 850,000 shares of common stock in exchange for $4 million principal amount of the notes. On May 29, 2009, the Company made certain interest payments due April 30, under certain of its unsecured debt that had previously been withheld, which debt was not part of the exchanges. About Anthracite Capital Anthracite Capital, Inc., is a specialty finance company focused on investments in high yield commercial real estate loans and related securities. Anthracite is externally managed by BlackRock Financial Management, Inc., which is a subsidiary of BlackRock, Inc., one of the largest publicly traded investment management firms in the United States with roughly $1.307 trillion in global assets under management at December 31, 2008. BlackRock Realty Advisors, Inc., another subsidiary of BlackRock, provides real estate equity and other real estate-related products and services in a variety of strategies to meet the needs of institutional investors. Anthracite Capital reported net income of $25.5 million for the three months ended March 31, 2009, compared to $53.9 million for the same period in 2008. Anthracite Capital had $4.85 billion in total assets, including cash and cash equivalents of $3.87 million, and $4.22 million in total liabilities, resulting in $584.0 million in stockholders' equity at March 31, 2009. Going Concern Doubt The Company's independent registered public accounting firm has issued an opinion on the Company's consolidated financial statements that states the consolidated financial statements have been prepared assuming the Company will continue as a going concern and further states that the Company's liquidity position, current market conditions and the uncertainty relating to the outcome of the Company's ongoing negotiations with its lenders have raised substantial doubt about the Company's ability to continue as a going concern. The Company obtained agreements from its secured credit facility lenders on March 17, 2009, that the going concern reference in the independent registered public accounting firm's opinion to the consolidated financial statements is waived. AVONDALE GATEWAY: 6 Largest Unsecured Creditors ----------------------------------------------- Debtor: Avondale Gateway Center Entitlement, LLC 15333 North Pima Road, Suite 305 Scottsdale, AZ 85260 Bankruptcy Case No.: 09-12153 Chapter 11 Petition Date: June 2, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Charles G. Case II Debtor's Counsel: John J. Hebert, Esq. Polsinelli Shughart, P.C. 3636 N. Central Avenue Phoenix, AZ 85012 Tel: (602) 650-2011 Fax: (602) 391-2546 Email: jhebert@polsinelli.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 List of 6 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Allison Macaulay LLC $1,190 Delaware Secretary of State $250 Erickson & Meeks $38,465 Fennemore Craig PC $2,227 Larson Allen $2,868 Survey Innovation Gruop Inc. $410 AVONDALE GATEWAY: Proposes Polsinelli Shughart as Counsel --------------------------------------------------------- Avondale Gateway Center Entitlement, LLC, sought and obtained permission from Judge Charles G. Case II of the U.S. Bankruptcy Court for the District of Arizona to employ Polsinelli Shughart P.C. as counsel, effective June 2, 2009. According to George D. Matthew, vice president of Cavan Management Services, manager of the Debtor, Polsinelli Shughart is already familiar with the Debtor's financial situation and is qualified to represent Debtor. The professional legal services Polsinelli Shughart will render include, without limitation, preparation of pleadings and applications and conducting examinations incidental to administration, advising the Debtor of its rights, duties and obligations under Chapter 11 of the Bankruptcy Code, taking any and all other necessary action incident to the proper preservation and administration of this Chapter 11 estate, and advising the Debtor in the formulation and presentation of a plan pursuant to Chapter 11, the disclosure statement and concerning an and all matters relating thereto. Polsinelli Shughart's professionals will charge the Debtor at an hourly rate of $135 to $500 per hour. Avondale Gateway Center Entitlement, LLC, filed for Chapter 11 on June 2, 2009 (Bankr. D. Ariz. Case No. 09-12153). Judge Charles G. Case II handles the case. The Debtor is represented by John J. Hebert, Esq., at Polsinelli Shughart, P.C., in Phoenix, Arizona. At the time of the bankruptcy filing, the Debtor estimated assets and debts of $10,000,001 to $50,000,000. BAUSCH & LOMB: S&P Affirms Corporate Credit Rating at 'B+' ---------------------------------------------------------- Standard & Poor's Ratings Services said that it affirmed its 'B+' corporate credit rating on Bausch & Lomb Inc. The outlook is stable. "Notwithstanding well-established and diverse positions in the ophthalmics field, the speculative-grade rating on Rochester, New York-based Bausch & Lomb Inc. reflects competitive concerns that are magnified by management turnover, and very high debt leverage assumed with its acquisition by Warburg Pincus in October 2007," said Standard & Poor's credit analyst Cheryl Richer. While Bausch & Lomb is a large manufacturer of contact lenses, lens-care solutions, ophthalmic pharmaceuticals, and products used for cataract surgery, its recent performance has been lackluster. Excluding sales attributable to eyeonics inc. (acquired in February 2008), 2008 consolidated sales declined modestly in constant currency. Revenues rebounded somewhat in the first quarter of 2009, exhibiting mid-single digit constant currency growth, excluding refractive sales, which may signal an improving trend. However, lens care sales have not fully recovered since the decline following the May 2006 global recall of ReNu with MoistureLoc multipurpose lens-care solution , and the company has been losing market share in contact lenses. Weak contact lens performance over the past several years initially reflected some spillover from the MoistureLoc recall, but has also been negatively affected by competitors' new product introductions. Furthermore, lens care sales continue to be pressured by increased global usage of daily disposable lenses. Contact lenses face challenges from dominant industry players Vistakon (a division of Johnson & Johnson), which has a global market share of more than 40%, CIBA Vision/Wesley Jessen (owned by Novartis AG), and from The Cooper Cos., whose market share slightly exceeds that of Bausch & Lomb. A weaker performance in vision care, which includes contact lenses and lens care, has been offset by stronger performance in pharmaceuticals and surgical (cataract/vitreoretinal and other ophthalmic surgery). The company recently received U.S. Food & Drug Administration approval for Besivance for the treatment of bacterial conjunctivitis, and announced a co-promotion agreement with Pfizer Inc. for certain ophthalmic pharmaceuticals. As a result of poor refractive performance because of a decline in microkeratome blade sales and weak market conditions, Bausch & Lomb formed a joint venture in January 2009 with 20/10 Perfect Vision AG, combining the refractive surgery assets of both businesses. To bolster its competitive position in intraocular lenses, the company acquired eyeonics inc., which manufactures the crystalens premium accommodating IOL. This product complements the company's portfolio of monofocal IOLs. Bausch & Lomb had been the only major player in the IOL market without a premium IOL (Advanced Medical Optics Inc. and Alcon both offer multifocal IOLs). Weakened operating margins reflect one-time costs associated with the MoistureLoc recall, as well as elevated merger-related legal and accounting expenses. Over time, profitability and cash flow stability should benefit from the diversity and recurring nature of the revenue stream. In addition, the company is executing a restructuring plan to reduce expenses. Still, the highly leveraged financial risk profile is characterized by S&P's calculation of debt to EBITDA (adjusted for operating leases and unfunded postretirement benefit obligations) of over 8x for the 12 months ended March 29, 2009. BEARINGPOINT INC: Delays Cash Use Motion After Objection -------------------------------------------------------- Carla Main and Dawn McCarty at Bloomberg News report that BearingPoint Inc. delayed a hearing to seek permission to pay severance and time off to employees out of its cash collateral, after creditors objected to the estimated $94 million in costs. BearingPoint lawyer Alfredo Perez, Esq., told Judge Robert Gerber of the U.S. Bankruptcy Court for the Southern District of New York that the company would keep using cash collateral under its current arrangement with lenders for another two weeks. The hearing has been rescheduled for June 29. According to the report, Judge Gerber has ruled that that BearingPoint only needed to inform the creditors committee before moving forward with further asset sales. About BearingPoint Inc. BearingPoint, Inc. -- http://www.BearingPoint.com/-- is currently one of the world's largest providers of management and technology consulting services to Global 2000 companies and government organizations in more than 60 countries worldwide. Based in McLean, Va., BearingPoint -- a former consulting arm of KPMG LLP -- has approximately 15,000 employees focusing on the Public Services, Commercial Services and Financial Services industries. BearingPoint professionals have built a reputation for knowing what it takes to help clients achieve their goals, and working closely with them to get the job done. The Company's service offerings are designed to help clients generate revenue, increase cost-effectiveness, manage regulatory compliance, integrate information and transition to "next-generation" technology. BearingPoint, Inc., fka KPMG Consulting, Inc., together with its units, filed for Chapter 11 protection on February 18, 2009 (Bankr. S.D. N.Y., Case No. 09-10691). Alfredo R. Perez, Esq., at Weil Gotshal & Manges LLP, has been tapped as counsel. Greenhill & Co., LLC, and AP Services LLC, have also been tapped as advisors. Davis Polk & Wardell is special corporate counsel. BearingPoint disclosed total assets of $1,762,689,000, and debts of $2,231,839,000 as of September 30, 2008. Contemporaneous with their bankruptcy petitions, the Debtors filed a pre-packaged Joint Plan of Reorganization under Chapter 11 to implement the terms of their agreement with the secured lenders. BearingPoint intended a traditional reorganization by proposing to issue new stock to unsecured creditors and holders of $690 million in subordinated notes, pursuant to a Chapter 11 plan. The Debtors, however, changed their course and sold off certain units. The Debtors sold their public services group to Deloitte LLP for $350 million. BEARINGPOINT INC: Wants Plan Filing Period Extended to October 16 ----------------------------------------------------------------- BearingPoint Inc., et al., ask the U.S. Bankruptcy Court for the Southern District of New York to extend their exclusive periods to file a Chapter 11 plan and solicit acceptances thereof, to October 16, 2009, and December 15, 2009, respectively. The Debtors tell the Court that while they have completed the sale of the majority of their assets, the universe of assets remaining in their estates is still considerable. The filing of a plan of reorganization or liquidation at this time, the Debtors add, would be disruptive of the above wind-down and sale processes. The deadline to file any objections and responses to the motion is June 29, 2009, at 11:00 a.m. (Eastern Time). As reported in the Troubled Company Reporter on June 17, 2009, PricewaterhouseCoopers LLP completed the purchase of the majority of BearingPoint's North American Commercial Services practice. On April 17, 2009, the Debtors entered into a definitive agreement with PwC pursuant to which BearingPoint agreed to sell a substantial portion of its assets related to its Commercial Services business unit, including Financial Services, to PwC. In addition, an affiliate of PwC also entered into a definitive agreement to purchase the equity interests of BearingPoint Information Technologies (Shanghai) Limited, a subsidiary of BearingPoint that operates a global development center in China, and certain assets of a separate global development center in India. The aggregate purchase price for the three transactions is roughly $25 million. As reported in the Troubled Company Reporter on May 11, 2009, BearingPoint, Inc., said it had closed the sale of its North American Public Services business to Deloitte LLP. Under the terms of the previously disclosed transaction, Deloitte acquired the majority of the Company's Public Services unit for $350 million. About BearingPoint Inc. BearingPoint, Inc. -- http://www.BearingPoint.com/-- is currently one of the world's largest providers of management and technology consulting services to Global 2000 companies and government organizations in more than 60 countries worldwide. Based in McLean, Va., BearingPoint -- a former consulting arm of KPMG LLP - - has approximately 15,000 employees focusing on the Public Services, Commercial Services and Financial Services industries. The Company's service offerings are designed to help clients generate revenue, increase cost-effectiveness, manage regulatory compliance, integrate information and transition to "next- generation" technology. BearingPoint, Inc., fka KPMG Consulting, Inc., together with its units, filed for Chapter 11 protection on February 18, 2009 (Bankr. S.D. N.Y., Case No. 09-10691). Alfredo R. Perez, Esq., at Weil Gotshal & Manges LLP, in Houston; Marcia J. Goldstein, Esq., Ronit J. Berkovich, Esq., and Jose R. Alcantar, Esq., at Weil Gotshal & Manges LLP, in New York, represent the Debtors as restructuring counsel. AlixPartners, LLP is the Debtors' restructuring advisors. Greenhill & Co., LLC is the Debtor's financial advisor & investment banker. Jeffrey S. Sabin, Esq., at Bingham McCutchen LLP, represent the Creditors' Committee as counsel. BearingPoint disclosed total assets of $1,762,689,000, and debts of $2,231,839,000 as of September 30, 2008. Contemporaneous with their bankruptcy petitions, the Debtors filed a pre-packaged Joint Plan of Reorganization under Chapter 11 to implement the terms of their agreement with the secured lenders. BearingPoint intended a traditional reorganization by proposing to issue new stock to unsecured creditors and holders of $690 million in subordinated notes, pursuant to a Chapter 11 plan. The Debtors, however, changed their course and sold off certain units. BERNARD KOSAR: Files for Chapter 11 Bankruptcy Protection --------------------------------------------------------- Bernie Kosar has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of Florida, listing $1 million to $10 million in assets and $10 million to $50 million in debts. South Florida Business Journal reports that Florida Bank holds a total of $9.6 million in unsecured claims against Mr. Kosar. Business Journal relates that Mr. Kosar and his Boardwalk LLC lost a $2.9 million foreclosure judgment on a 36-unit apartment building to Florida Bank in Pinellas County Circuit Court. Mr. Kosar and his Oakmont LLC, Business Journal relates, lost a $3.3 million foreclosure judgment to Florida Bank in Hillsborough County Circuit County over a Tampa apartment building in April. Florida Bank also had a foreclosure lawsuit pending in Pinellas County against Kosar and his PCV LLC. Mr. Kosar's other major unsecured creditors are: -- A $3.1 million personal guaranty to Key Bank National Association of Cleveland; -- $3.04 million to his ex-wife Babette J. Kosar; -- $725,000 in a disputed loan involving attorney Jim Ferraro of Coral Gables; -- $1.4 million total on three claims involving the Browns; and -- $231,094 to the IRS Mr. Kosar's Steakhouse, according to Business Journal, was evicted from its South Miami space in November 2008. The report states that Mr. Kosar faces significant tax problems including: -- $59,881 in unpaid property taxes on his Weston home; and -- a combined $93,647 in federal tax liens against him over his personal income taxes. Mr. Kosar also fully paid a separate $228,806 federal tax lien placed on him in July 2008, Business Journal says. Mr. Kosar, questioned about previously unpaid taxes in August 2008, said that some bills were lost in the shuffle during his divorce, according to The Plain Dealer. The Plain Dealer quoted him as saying, "Divorce is difficult enough as it is, especially for someone who wasn't really looking to do that. So, who owes what and all of that becomes hard, but whatever I owe, obviously I would pay." Mr. Kosar's home at 2940 Paddock Road is listed online at Realtor.com at $3.5 million, Business Journal states. Julianne R. Frank at Frank, White-Boyd in Palm Beach Gardens assists Mr. Koar in his restructuring efforts, Business Journal reports. Bernie Kosar is a former Cleveland Browns and University of Miami quarterback. He lives in the Fort Lauderdale suburb of Weston. BERNARD KOSAR: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Bernard J. Kosar, Jr. aka Bernie J. Kosar, Jr. aka Bernie Kosar, Jr. aka Bernie Kosar 2940 Paddock Rd. Weston, FL 33331 Bankruptcy Case No.: 09-22371 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Judge: Raymond B. Ray Debtor's Counsel: Julianne R. Frank, Esq. 11382 Prosperity Farms Rd. #230 Palm Beach Gardens, FL 33410 Tel: (561) 626-4700 Fax: (561) 627-9479 Email: fwbbnk@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/flsb09-22371.pdf The petition was signed by Bernard J. Kosar, Jr. BERNARD MADOFF: SEC Charges Madoff Solicitors, Feeder With Fraud ---------------------------------------------------------------- The Securities and Exchange Commission charged a New York-based broker-dealer and four individuals with securities fraud, alleging that they collectively raised billions of dollars from investors for Bernard L. Madoff's Ponzi scheme. In a complaint filed in U.S. District Court for the Southern District of New York, the SEC charged Cohmad Securities Corporation as well as its chairman Maurice J. Cohn, chief operating officer Marcia B. Cohn, and registered representative Robert M. Jaffe for actively marketing investment opportunities with Mr. Madoff while knowingly or recklessly disregarding facts indicating that Mr. Madoff was operating a fraud. In a separate complaint filed in the same court, the SEC charged California-based investment adviser Stanley Chais, who oversaw three funds that invested all of their assets with Mr. Madoff. When the Ponzi scheme collapsed, Chais investors' accounts were valued at nearly $1 billion. The SEC previously charged Mr. Madoff and Bernard L. Madoff Investment Securities LLC as well as their auditors with committing securities fraud through a Ponzi scheme perpetrated on advisory and brokerage customers of BMIS. "Madoff cultivated an air of exclusivity by pretending that he was too successful to trouble himself with marketing to new investors," said Robert Khuzami, Director of the SEC's Division of Enforcement. "In fact, he needed a constant in-flow of funds to sustain his fraud, and used his secret control of Cohmad to obtain them." James Clarkson, Acting Director of the SEC's New York Regional Office, added, "These Madoff solicitors collectively received several hundred million dollars in fees over the past few decades while Madoff ruined the finances of countless investors." The Cohmad Complaint The SEC's complaint against the Cohmad defendants alleges that while bringing investors to Mr. Madoff, they ignored and even participated in many suspicious practices that clearly indicated Mr. Madoff was engaged in fraud. For example, the SEC's complaint alleges that the Cohns and Cohmad filed false Forms BD and FOCUS reports that concealed Cohmad's primary business of bringing in investors for BMIS. This referral business comprised as much as 90% of Cohmad's revenue in some years, brought in more than 800 accounts, and billions of dollars into BMIS' advisory business, for which BMIS paid them more than $100 million. The SEC's complaint also alleges that the compensation arrangement between BMIS and Cohmad indicated fraudulent conduct at BMIS. Cohmad was paid an annual percentage of the funds its representatives (except Mr. Jaffe) brought into BMIS offset by any withdrawals from those investor accounts. This compensation arrangement indicated to Cohmad and the Cohns that BMIS was not providing any real returns to investors. For example, where the client's principal investment had been $10,000, Cohmad stopped receiving fees if a client withdrew $15,000 from an account, even if under BMIS' management the account had purportedly grown to $100,000. In Cohmad's internal records, such an account was designated with a negative $5,000 number. The SEC alleges that Mr. Jaffe also participated in Mr. Madoff's fraud by soliciting investors and bringing more than $1 billion into BMIS. The SEC's complaint alleges, among other things, that Madoff compensated Mr. Jaffe with outsized returns in Mr. Jaffe's personal accounts that he knew, or was reckless in not knowing, were manufactured by BMIS employees entering fictitious, backdated trades onto trade confirmations and account statements for his personal accounts at BMIS. The Chais Complaint The SEC's complaint alleges that Mr. Chais committed fraud by misrepresenting his role in managing the funds' assets and for distributing account statements that he should have known were false. According to the SEC's complaint, for the last 40 years, Mr. Chais has held himself out as an investing wizard who managed hundreds of millions of dollars of investor funds in three partnerships, the Lambeth, Popham and Brighton Companies. Mr. Chais made a number of misrepresentations over the years to the Funds' investors indicating that he formulated and executed the Funds' trading strategy. In reality, Mr. Chais was an unsophisticated investor who did nothing more than turn all of the Funds' assets over to Mr. Madoff, while charging the Funds more than $250 million in fees for his purported "services." Although Mr. Madoff managed all of the Funds' assets, many of the Funds' investors had never heard of Mr. Madoff before the collapse of his Ponzi scheme, and had not known that Chais invested with Madoff until Chais informed them after Mr. Madoff's arrest. The SEC also alleges that Mr. Chais ignored red flags indicating that Mr. Madoff's reported returns were false. For example, Mr. Chais told Mr. Madoff that Mr. Chais did not want there to be any losses on any of the Funds' trades. Mr. Madoff complied with Mr. Chais's request, and from 1999 to 2008, despite reportedly executing thousands of trades on behalf of the Funds, Mr. Madoff did not report a loss on a single equities trade. Mr. Chais however, with the assistance of his accountant, prepared account statements for the Funds' investors based upon the Madoff statements, and continued to distribute them to the Funds' investors even though he should have known they were false. According to the SEC's complaint, Mr. Chais also opened and exercised control over approximately 60 other accounts at Mr. Madoff's firm on behalf of his family members and related entities. Taking all of these accounts collectively, between 1995 and 2008, Mr. Chais and his family members and related entities withdrew more than $500 million more than they actually invested with Madoff. The SEC's complaint against the Cohmad defendants specifically alleges that Cohmad violated Section 17(a) of the Securities Act of 1933, Sections 10(b), 15(b)(1), 15(b)(7), and 17(a) of the Securities Exchange Act of 1934 and Rules 10b-5, 15b3-1, 15b7-1 and 17a-3 thereunder and aided and abetted violations of Sections 206(1), 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-3 thereunder; that the Cohns violated Section 17(a) of the Securities Act, and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and aided and abetted violations of Sections 10(b), 15(b)(1), 15(b)(7), and 17(a) of the Exchange Act and Rules 10b-5, 15b3-1, 15b7-1 and 17a-3 thereunder and Sections 206(1), 206(2) and 206(4) of the Advisers Act and Rule 206(4)-3 thereunder; and that Robert Jaffe violated Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b- 5 thereunder and aided and abetted violations of Sections 10(b), 15(b)(7), and 17(a) of the Exchange Act and Rules 10b-5, 15b7-1 and 17a-3 thereunder and Sections 206(1), 206(2) and 206(4) of the Advisers Act and Rule 206(4)-3 thereunder. The SEC's complaint against Mr. Chais specifically alleges that he violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, and Section 206(4) of the Advisers Act and Rule 206(4)-8 thereunder. Both SEC's complaints seek injunctions, financial penalties and court orders requiring Cohmad, the Cohns, Messrs. Jaffe and Chais to disgorge their ill-gotten gains. The SEC acknowledges the assistance of the Trustee for the Securities Investor Protection Corporation, and California Attorney General Jerry Brown. The SEC's investigation is continuing. About Bernard L. Madoff Investment Securities 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. BERNARD MADOFF: Trustee Sues Cohmad to Avoid $100MM in Deals ------------------------------------------------------------ Irving H. Picard, the Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC, filed a complaint in the United States Bankruptcy Court against Cohmad Securities Corporation and a number of its principals, including Maurice "Sonny" Cohn, Marcia Cohn and Robert Jaffe, as well as other related defendants. The complaint seeks to avoid decades worth of transactions through which BLMIS paid well over $100 million to Cohmad, Sonny Cohn and other Cohmad related individuals in exchange for Sonny Cohn, Marcia Cohn, Robert Jaffe and other Cohmad employees introducing victims to BLMIS and knowingly helping Madoff create, fund and maintain his massive Ponzi scheme. Remarkably, 90% or more of the income to Cohmad and others came from the referral of customers to Madoff. "Although Madoff stated he was operating alone, our investigation has yielded significant evidence that, in fact, a variety of other people helped Madoff prey on innocent victims," explained David Sheehan, counsel for the Trustee and a partner at Baker & Hostetler, the court appointed counsel for Mr. Picard. "We are bringing this lawsuit to help recover, at the very least, the commissions that Madoff's enablers generated for knowingly introducing unsuspecting investors to Madoff," said Mr. Picard. The complaint portrays the unique relationships between Mr. Madoff, Cohmad, the Cohns, Mr. Jaffe and other Cohmad individuals, who, though ostensibly at different companies, acted as a single enterprise. According to the complaint, while Mr. Madoff shrouded himself with an unapproachable, Wizard of Oz-like aura eschewing unknown investors, the reality is that the Cohns, Mr. Jaffe and others were actively recruiting more than 1,000 customer accounts and infusing the Ponzi scheme with billions of dollars. The Trustee said that the case was developed by David Sheehan, John W. Moscow, Oren Warshavsky, Seanna Brown and Mary Anne Stanganelli at Baker & Hostetler, working closely with both FTI Consulting and Alix Partners on the evidentiary analysis. The case will be handled by them. The Trustee thanked the United States Securities and Exchange Commission, especially Andrew Calamari, Israel Friedman, Alexander Vasilescu and George Demos of the New York Regional Office together with Rob Khazami of the Enforcement Division. "We look forward to continuing to work cooperatively with the Commission and the Department of Justice to recover property for the victims of Madoff's crimes, and to appropriately distribute the proceeds of the lawsuits we bring," said Mr. Picard. About Bernard L. Madoff Investment Securities 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. BRIGETTE MILLER LEVY: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Brigette Miller Levy dba Brigette Miller 789 Belvidere Ave. Plainfield, NJ 07062 Bankruptcy Case No.: 09-25537 Chapter 11 Petition Date: June 15, 2009 Court: United States Bankruptcy Court District of New Jersey (Newark) Debtor's Counsel: Andre L. Kydala, Esq. Law Firm of Andrea Kydala 12 Lower Center St. PO Box 5537 Clinton, NJ 08809 Tel: (908) 735-2616 Fax: (908) 735-0765 Email: kydalalaw@aim.com Total Assets: $3,544,558 Total Debts: $3,628,012 A full-text copy of the Debtor's petition, including a list of its 5 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/njb09-25537.pdf The petition was signed by Danilo Rico, president of the Company. BRITANNIA BULK: Holdings Seeks Chapter 15 Creditor Protection ------------------------------------------------------------- Britannia Bulk Holdings Inc. filed for Chapter 15 bankruptcy protection on June 11 before the U.S. Bankruptcy Court for the Southern District of New York. The Chapter 15 Debtor seeks protection in the U.S. from shareholders suits. Britannia Bulk Holdings acts as Foreign Representative for the Chapter 15 estate. Brian W. Harvey, Esq., at Goodwin Procter LLP, in New York, represents the Foreign Representative. Britannia Bulk had an initial public stock offering in June 2008 at $15 a share. On the first day of trading, the stock closed at $13.85. By October 28, when the Company announced a significant loss, the stock was down to 27 cents. At the same time, banks accelerated $159 million in secured debt, prompting the company to file for administration in the High Court of Justice of England and Wales, Bill Rochell at Bloomberg News reported. Britannia Bulk plc, an operating company, filed for Chapter 15 protection in November. The Bankruptcy Court in Manhattan approved the petition that the U.K. is the site of the "foreign main proceedings" and all manner of creditor actions in the U.S. were halted. As reported by TCR-Europe on December 1, 2008, Britannia Bulk Holdings Inc. is facing a securities fraud class action suit filed by law firm Saxena White P.A. in the United States District Court for the Southern District of New York. The complaint seeks damages for violations of federal securities laws on behalf of all investors who acquired Britannia Bulk Holdings Inc. common stock pursuant or traceable to the Company's Registration Statement and Prospectus issued in connection with its June 17, 2008 initial public offering. Headquartered in London, England, Britannia Bulk Holdings Inc. (OTC:BBLKF) -- http://www.britbulk.com/-- is an international provider of drybulk shipping and maritime logistics services with a market position in transporting drybulk commodities in and out of the Baltic region. As of March 31, 2008, Company-owned fleet consisted of 22 vessels, including 13 drybulk vessels, five of which are ice-class, five ocean-going ice-class barges, and four ice-class tugs. To complement its owned fleet, the Company charters-in a number of vessels. At March 31, 2008, the number of chartered-in drybulk vessels under its control was 45, 11 of which were ice-class. The Company's managed drybulk vessels serve a variety of ports and carry multiple cargoes, while its tug and barge vessels provide the ability for its to serve ports that are too small or otherwise unable to accommodate drybulk vessels Britannia Bulk's affairs, business and assets are managed by Mark Shaw, Malcolm Cohen and Shay Bannon of BDO Stoy Hayward LLP at 55 Baker Street in London, as the joint administrators in insolvency proceedings in the United Kingdom Britannia's operating units -- Britannia Bulk Plc and Britannia Bulkers A/S -- filed Chapter 15 petitions in 2008. The holdings company, Britannia Bulk Holdings Inc., subsequently filed a Chapter 15 petition on June 11, 2009 (Bankr. S.D.N.Y. Case No. 09- 13724). Judge Robert E. Gerber handles the case. Brian W. Harvey, Esq., at Goodwin Procter LLP, represents the Chapter 15 Debtors. Britannia Bulk Holdings said that at the time of the filing it had assets of $50 million to $100 million against debts of $10 million to $50 million. BROOKE CORP: Ch 11 Trustee Seeks to Block Founder's Bankruptcy -------------------------------------------------------------- Kansas City Business Journal reports that Albert Riederer, the Chapter 11 trustee of the Brooke Corp. and Brooke Capital Corp., has sought to block former Brooke Corp. founder and CEO Robert Orr's filing for bankruptcy protection. According to Business Journal, Mr. Reiderer is accusing Mr. Orr of transferring about $4 million from various Brooke accounts to Brooke Holdings, "with the intent of enriching Orr, his other family members and/or trusts which were set up with Orr and/or his family members as beneficiaries." Mr. Orr transferred the $4 million at a time when he knew that the Brooke companies wouldn't be able to sustain their business operations for any significant period of time, Business Journal says, citing Mr. Riederer. Business Journal relates that Mr. Reider claims that during 2008 or earlier, Mr. Orr diverted $14 million of revenue from Brooke companies to pay for the debt obligations of franchisees, in order to hide the true financial condition of the Brooke companies from creditors. The report quoted Mr. Reider as saying, "Orr's actions in doing so constituted a breach of his fiduciary obligations because he was directing that the (Brooke companies) pay obligations for which the (Brooke companies) were not liable." Mr. Reider alleges that under the direction of Mr. Orr, the Brooke companies diverted some $4 million from accounts that held the insurance premiums paid by insurers to cover an overdraft that the Brooke companies had at wholly owned subsidiary Generations Bank, Business Journal states. Headquartered in Kansas, Brooke Corp. (NASDAQ: BXXX) -- http://www.brookebanker.com/-- is an insurance agency and finance company. The Company owns 81% of Brooke Capital. The majority of the company's stock was owned by Brooke Holding Inc., which, in turn was owned by the Orr Family. A creditor of the family, First United Bank of Chicago, was foreclosed on the BHI stock. The company's revenues are generated from sales commissions on the sales of property and casualty insurance policies, consulting, lending and brokerage services. Brooke Corp. and its affiliate, Brooke Capital Corp. filed for Chapter 11 protection on Oct. 28, 2008 (Bankr. D. Kan. Case No. 08-22786). Angela R. Markley, Esq., is the Debtors' in-house counsel. Richard A. Wieland, the U.S. Trustee for Region 20, appointed seven creditors to serve on an Official Committee of Unsecured Creditors for the Debtors' Chapter 11 cases. The Debtors listed assets of $512,855,000 and debts of $447,382,000. CAJUN FUNDING: Church's Chicken Sale Won't Move Moody's B2 Rating ----------------------------------------------------------------- Moody's Investors Service said the proposed sale of Church's Chicken, which is owned by Cajun Funding Corp., to a private equity firm should not have immediate impact on Cajun's current B2 Corporate Family Rating, SGL-2 Speculative Grade Liquidity rating and stable outlook. For more information, please refer to the issuer comment on Moodys.com. The last rating action on Cajun occurred on October 28, 2008, when its liquidity rating was upgraded to SGL-2 from SGL-3. Cajun Funding Corp., headquartered in Atlanta, Georgia, is the special purpose financing entity for Cajun Operating Company, Inc., the developer and operator of Church's Chicken restaurants. With more than 1600 outlets worldwide, the company generates over $1.2 billion annual system-wide sales globally. CANADIAN SUPERIOR: Agrees to Business Combination With Challenger ----------------------------------------------------------------- Canadian Superior Energy Inc. (CA:SNG) (NYSE Amex: SNG) and Challenger Energy Corp. (CA:CHQ) have entered into an arrangement agreement providing for the acquisition by Canadian Superior of Challenger. Canadian Superior will acquire all of the outstanding common shares of Challenger in exchange for the issuance of 0.51 of a common share of Canadian Superior for each outstanding Challenger Share. Based on the 20 day volume weighted average trading price of the Canadian Superior Shares, the exchange ratio equals a price of C$.4345 per Challenger Share and represents a 36% premium to Challenger's closing trading price on June 18, 2009 and a 15% premium to the 20 day volume weighted average trading price of the Challenger Shares. The total transaction value, including the assumption of roughly C$54.4 million in Challenger's net debt, is roughly C$77.8 million. Characteristics of the Pro Forma Company: -- Current Western Canadian production of roughly 3,050 boepd (85% natural gas); with an additional 300 boepd behind pipe and over 146,000 net undeveloped in Alberta and BC; -- A diversified suite of oil and natural gas exploration and development assets located in Canada, Trinidad and Tobago, and North Africa and a liquefied natural gas ("LNG") project located on the east coast of the United States; -- A market capitalization in excess of C$160.6 million (based on the current trading price of the Canadian Superior Shares); -- Approximately 195.8 million shares outstanding. Canadian Superior has said that, as part of its restructuring pursuant to the Companies' Creditors Arrangement Act, it has reached an agreement with Centrica plc, under which Centrica will acquire from Canadian Superior a 45% interest in Block 5(c), located offshore Trinidad, for US$142.5 million in cash. The Centrica agreement is subject to the satisfaction of certain conditions including pre-emption rights from existing field partners and to the approval by the Court of Queen's Bench of Alberta, and by the Ministry of Energy and Energy Industries of the Government of Trinidad and Tobago. Canadian Superior intends to exit CCAA with these assets in place -- a 25% interest in Block 5(c) and its MG exploration block, both in Trinidad, all of its Western Canadian producing properties, its interest in the 7th of November block offshore Libya and Tunisia, its Liberty Natural Gas LNG project in New Jersey, and its offshore Nova Scotia exploration acreage. In addition the Company will reconstitute its Board of Directors, make additions to senior management, and also intends to have in place a new undrawn credit facility, with sufficient funding to execute its anticipated 18- month capital program. Transaction Terms and Conditions The transaction is to be effected by way of an arrangement under the Canada Business Corporations Act. Completion of the Arrangement, which is anticipated to occur in late August, is subject to, among other things, the requisite approval of the holders of Challenger Shares (Challenger Shareholders), the approval of the Court of Queen's Bench of Alberta, the receipt of all necessary regulatory and stock exchange approvals, and certain closing conditions that are customary for a transaction of this nature. The Board of Directors of Challenger has unanimously determined that the proposed Arrangement is in the best interests of, and fair to, Challenger and its stakeholders, and unanimously recommends that Challenger Shareholders vote in favour of the Arrangement at the upcoming meeting. Each of the directors and officers of Challenger, who collectively hold approximately 2% of the outstanding Challenger Shares, have agreed to enter into support agreements pursuant to which each has agreed to vote in favour of the Arrangement. The Arrangement Agreement prohibits Challenger from soliciting or initiating any discussion regarding any other business combination or sale of material assets, contains provisions for Canadian Superior to match competing, unsolicited proposals and provides for a mutual C$3 million termination fee payable in certain circumstances. Financial Advisors Jennings Capital Inc. is acting as financial advisor to the Independent Committee of the Board of Directors of Canadian Superior with respect to the Arrangement and has advised the Independent Committee and the Board of Directors of Canadian Superior that it is of the opinion that the consideration to be offered by Canadian Superior pursuant to the proposed Arrangement is fair, from a financial point of view, to Canadian Superior and its shareholders. Peters & Co. Limited is acting as financial advisor to Challenger in connection with its review of strategic alternatives and the Arrangement and has advised the Board of Directors of Challenger that it is of the opinion, as of the date hereof, that the consideration to be received by the Challenger Shareholders pursuant to the proposed Arrangement is fair, from a financial point of view, to the Challenger Shareholders. Extension of CCAA Stay As reported by the Troubled Company Reporter on June 9, 2009, Challenger Energy has been granted an extension of the stay of proceedings to July 24, 2009, to the previous court order that was granted on April 20, 2009, which had extended the stay of proceedings from April 20, 2009, to June 4, 2009, from the Court of Queen's Bench of Alberta, Judicial District of Calgary for protection under the Companies' Creditors Arrangement Act (Canada). The TCR also said Canadian Superior Energy's application to the Court of Queen's Bench of Alberta for an Order under the Companies' Creditors Arrangement Act (Canada) to extend its CCAA protection has been granted, allowing the Company to continue to prepare a plan of arrangement for its creditors, and staying all claims and actions against the Company and its assets. The extension under the Order granted will be in effect until July 24, 2009, at which time the matter will be reviewed by the Court. About Canadian Superior Energy Canadian Superior Energy Inc. -- http://www.cansup.com/-- is a Calgary, Alberta, Canada based diversified global energy company engaged in the exploration and production of oil and natural gas with operations or projects located in Canada, Trinidad and Tobago and North Africa. Canadian Superior is also developing a liquefied natural gas project on the East Coast of the United States. About Challenger Energy Challenger Energy Corp. -- http://www.challenger-energy.com/-- is a Calgary, Alberta, Canada based oil and gas exploration company which has invested approximately US$80.1 million in exploration expenditures in Block 5(c) offshore Trinidad and Tobago. CAPITAL CORP: U.S. Trustee Appoints 3 Members to Creditors Panel ---------------------------------------------------------------- Pursuant to 11 U.S.C. Sec. 1102(a) and 1102(b)(I), Sara L. Kistler, the Acting United States Trustee for Region 17, has appointed three creditors of to the committee of unsecured creditors of Capital Corp. of the West. (1) THOMAS T. HAWKER 2954 GREENFIELD DRIVE MERCED, CA 95340 ATTN: THOMAS T. HAWKER (2) U.S. BANK NATIONAL ASSOCIATION, as TRUSTEE ONE FEDERAL STREET, 3 RD FLOOR BOSTON, MA 02110 ATTN: ROBERT BUTZIER (3) WILMINGTON TRUST COMPANY as TRUSTEE RODNEY SQUARE NORTH 1100 NORTH MARKET STREET WILMINGTON, DE 19890-1615 ATTN: DAVID VANASKEY About Capital Corp of the West Capital Corporation of the West is a bank holding company, whose primary asset and source of income is County Bank of Merced. The Bank is a community bank with operations located mainly in the San Joaquin Valley of Central California with additional business banking operations in the San Francisco Bay Area. The corporate headquarters of the Company and the Bank's main branch facility are located at 550 West Main Street, Merced, California. County Bank was closed February 6, 2009, by the California Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Westamerica Bank, based in San Rafael, California, to assume all of the deposits of County Bank. As of February 2, 2009, County Bank had total assets of approximately $1.7 billion and total deposits of $1.3 billion. In addition to assuming all of the failed bank's deposits, including those from brokers, Westamerica Bank agreed to purchase all of County Bank's assets. Capital Corp of the West filed for bankruptcy on May 11, 2009 (Bankr. E.D. Calif. Case No. 09-14298). Judge W. Richard Lee presides over the case. Paul J. Pascuzzi, Esq., at Felderstein Fitzgerald Willoughby & Pascuzzi, serves as the Debtor's bankruptcy counsel. As of September 30, 2008, Capital Corp. of the West had $1.87 billion in total assets, $1.79 billion in total liabilities and shareholders' equity of $73.9 million. In its Chapter 11 petition, the Company disclosed $6,789,058 in total assets and $68,096,190 in total debts. CARAUSTAR INDUSTRIES: Court OKs Deloitte as Auditor and Consultant ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Georgia authorized Caraustar Industries Inc. and its debtor-affiliates to employ Deloitte & Touche LLP as independent auditor and Deloitte Tax LLP as tax consultants. Deloitte & Touche will audit Debtors' retirement plan's financial statements and schedules for the year ended December 31, 2008, and financial statement of their employees' savings plan. Deloitte Tax, among other things, advise the Debtors in identifying the potential federal, state and local and international income tax implications associated with any proposed restructuring alternatives to be evaluated by the Debtors which may include debt-for-equity exchanges, debt-for-debt exchanges, disposition of assets, rationalization of their corporate structure or other strategic alternatives. The firm will be paid at these rates: Designation Hourly Rate ----------- ----------- Partner/Principal/Director $635 Senior Manager $565 Manager $485 Senior $335 Staff $280 To the best of the Debtors' knowledge, the firms are "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About Caraustar Industries Headquartered in Austell, Georgia, Caraustar Industries, Inc. -- http://www.caraustar.com/-- is one of North America's largest integrated manufacturers of 100% recycled paperboard and converted paperboard products. The Debtors serve the four principal recycled boxboard product end-use markets: tubes and cores; folding cartons; gypsum facing paper and specialty paperboard products. The Company and its affiliates filed for Chapter 11 on May 31, 2009 (Bankr. N. D. Ga. Lead Case No. 09-73830). James A. Pardo, Jr., Esq., and Mark M. Maloney, Esq., at King & Spalding represent the Debtors on their restructuring efforts. The Debtors listed $50 million to $100 million in assets and $100 million to $500 million in debts. CARAUSTAR INDUSTRIES: King & Spalding Approved as Counsel --------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Georgia authorized Caraustar Industries Inc. and its debtor-affiliates to employ King & Spalding as their counsel. The firm is expected to: a) advise the Debtors with respect to their powers and duties as debtors-in possession in the continued management and operation of their businesses; b) take all necessary action to protect and preserve the estates of the Debtors, including the prosecution of actions on the Debtors' behalf, the defense of any actions commenced against the Debtors, the negotiation of disputes in which the Debtors are involved, and the preparation of objections to claims filed against the Debtors' estates; c) prepare on behalf of the Debtors all necessary motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtors' estates; d) negotiate and prepare on behalf of the Debtors a plan, a disclosure statement, and all related documents, and to perform all legal services necessary to effect a successful restructuring; and e) negotiate and prepare documents relating to the disposition of assets, as requested by the Debtors. The firm's professionals will charge the Debtors at these rates: Professionals Designation Hourly Rate ------------- ----------- ----------- James A. Pardo, Jr., Esq. Partner $815 Mark M. Maloney, Esq. Partner $640 Michelle L. Carter, Esq. Associate $440 Jessica S. Jackson, Esq. Associate $310 Missy Heinz Senior Paralegal $245 To the best of the Debtors' knowledge, the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About Caraustar Industries Headquartered in Austell, Georgia, Caraustar Industries, Inc. -- http://www.caraustar.com/-- is one of North America's largest integrated manufacturers of 100% recycled paperboard and converted paperboard products. The Debtors serve the four principal recycled boxboard product end-use markets: tubes and cores; folding cartons; gypsum facing paper and specialty paperboard products. The Company and its affiliates filed for Chapter 11 on May 31, 2009 (Bankr. N. D. Ga. Lead Case No. 09-73830). James A. Pardo, Jr., Esq., and Mark M. Maloney, Esq., at King & Spalding represent the Debtors on their restructuring efforts. The Debtors listed $50 million to $100 million in assets and $100 million to $500 million in debts. CARLOS PEREZ: Case Summary & 17 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Carlos Ignacio Perez aka Carlos Perez Blanco 12431 Crabapple Meadow Way Alpharetta, GA 30009 Bankruptcy Case No.: 09-75826 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Northern District of Georgia (Atlanta) Judge: W. Homer Drake Debtor's Counsel: Leslie M. Pineyro, Esq. Leon S. Jones, Esq. Jones and Walden, LLC 21 Eighth Street, NE Atlanta, GA 30309 Tel: (404) 564-9300 Fax: (404) 564-9301 Email: lpineyro@joneswalden.com Total Assets: $1,122,050 Total Debts: $1,615,824 A full-text copy of the Debtor's petition, including a list of its 17 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ganb09-75826.pdf The petition was signed by Danilo Rico, president of the Company. CATHERINE QUAIL: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Catherine Teresa Quail 538 Adelphia Rd. Freehold, NJ 07728 Bankruptcy Case No.: 09-26022 Chapter 11 Petition Date: June 20, 2009 Court: United States Bankruptcy Court District of New Jersey (Trenton) Debtor's Counsel: Steven Abelson, Esq. 63 West Main Street PO Box 7005 Freehold, NJ 07728 Tel: (732) 462-4773 Email: sjaesq@sjabelson.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Ms. Quail. CHALLENGER ENERGY: Agrees to Merger With Canadian Superior ---------------------------------------------------------- Canadian Superior Energy Inc. (CA:SNG) (NYSE Amex: SNG) and Challenger Energy Corp. (CA:CHQ) have entered into an arrangement agreement providing for the acquisition by Canadian Superior of Challenger. Canadian Superior will acquire all of the outstanding common shares of Challenger in exchange for the issuance of 0.51 of a common share of Canadian Superior for each outstanding Challenger Share. Based on the 20 day volume weighted average trading price of the Canadian Superior Shares, the exchange ratio equals a price of C$.4345 per Challenger Share and represents a 36% premium to Challenger's closing trading price on June 18, 2009 and a 15% premium to the 20 day volume weighted average trading price of the Challenger Shares. The total transaction value, including the assumption of roughly C$54.4 million in Challenger's net debt, is roughly C$77.8 million. Characteristics of the Pro Forma Company: -- Current Western Canadian production of roughly 3,050 boepd (85% natural gas); with an additional 300 boepd behind pipe and over 146,000 net undeveloped in Alberta and BC; -- A diversified suite of oil and natural gas exploration and development assets located in Canada, Trinidad and Tobago, and North Africa and a liquefied natural gas ("LNG") project located on the east coast of the United States; -- A market capitalization in excess of C$160.6 million (based on the current trading price of the Canadian Superior Shares); -- Approximately 195.8 million shares outstanding. Canadian Superior has said that, as part of its restructuring pursuant to the Companies' Creditors Arrangement Act, it has reached an agreement with Centrica plc, under which Centrica will acquire from Canadian Superior a 45% interest in Block 5(c), located offshore Trinidad, for US$142.5 million in cash. The Centrica agreement is subject to the satisfaction of certain conditions including pre-emption rights from existing field partners and to the approval by the Court of Queen's Bench of Alberta, and by the Ministry of Energy and Energy Industries of the Government of Trinidad and Tobago. Canadian Superior intends to exit CCAA with these assets in place -- a 25% interest in Block 5(c) and its MG exploration block, both in Trinidad, all of its Western Canadian producing properties, its interest in the 7th of November block offshore Libya and Tunisia, its Liberty Natural Gas LNG project in New Jersey, and its offshore Nova Scotia exploration acreage. In addition the Company will reconstitute its Board of Directors, make additions to senior management, and also intends to have in place a new undrawn credit facility, with sufficient funding to execute its anticipated 18- month capital program. Transaction Terms and Conditions The transaction is to be effected by way of an arrangement under the Canada Business Corporations Act. Completion of the Arrangement, which is anticipated to occur in late August, is subject to, among other things, the requisite approval of the holders of Challenger Shares (Challenger Shareholders), the approval of the Court of Queen's Bench of Alberta, the receipt of all necessary regulatory and stock exchange approvals, and certain closing conditions that are customary for a transaction of this nature. The Board of Directors of Challenger has unanimously determined that the proposed Arrangement is in the best interests of, and fair to, Challenger and its stakeholders, and unanimously recommends that Challenger Shareholders vote in favour of the Arrangement at the upcoming meeting. Each of the directors and officers of Challenger, who collectively hold approximately 2% of the outstanding Challenger Shares, have agreed to enter into support agreements pursuant to which each has agreed to vote in favour of the Arrangement. The Arrangement Agreement prohibits Challenger from soliciting or initiating any discussion regarding any other business combination or sale of material assets, contains provisions for Canadian Superior to match competing, unsolicited proposals and provides for a mutual C$3 million termination fee payable in certain circumstances. Financial Advisors Jennings Capital Inc. is acting as financial advisor to the Independent Committee of the Board of Directors of Canadian Superior with respect to the Arrangement and has advised the Independent Committee and the Board of Directors of Canadian Superior that it is of the opinion that the consideration to be offered by Canadian Superior pursuant to the proposed Arrangement is fair, from a financial point of view, to Canadian Superior and its shareholders. Peters & Co. Limited is acting as financial advisor to Challenger in connection with its review of strategic alternatives and the Arrangement and has advised the Board of Directors of Challenger that it is of the opinion, as of the date hereof, that the consideration to be received by the Challenger Shareholders pursuant to the proposed Arrangement is fair, from a financial point of view, to the Challenger Shareholders. Extension of CCAA Stay As reported by the Troubled Company Reporter on June 9, 2009, Challenger Energy has been granted an extension of the stay of proceedings to July 24, 2009, to the previous court order that was granted on April 20, 2009, which had extended the stay of proceedings from April 20, 2009, to June 4, 2009, from the Court of Queen's Bench of Alberta, Judicial District of Calgary for protection under the Companies' Creditors Arrangement Act (Canada). The TCR also said Canadian Superior Energy's application to the Court of Queen's Bench of Alberta for an Order under the Companies' Creditors Arrangement Act (Canada) to extend its CCAA protection has been granted, allowing the Company to continue to prepare a plan of arrangement for its creditors, and staying all claims and actions against the Company and its assets. The extension under the Order granted will be in effect until July 24, 2009, at which time the matter will be reviewed by the Court. About Canadian Superior Energy Canadian Superior Energy Inc. -- http://www.cansup.com/-- is a Calgary, Alberta, Canada based diversified global energy company engaged in the exploration and production of oil and natural gas with operations or projects located in Canada, Trinidad and Tobago and North Africa. Canadian Superior is also developing a liquefied natural gas project on the East Coast of the United States. About Challenger Energy Challenger Energy Corp. -- http://www.challenger-energy.com/-- is a Calgary, Alberta, Canada based oil and gas exploration company which has invested approximately US$80.1 million in exploration expenditures in Block 5(c) offshore Trinidad and Tobago. CHENIERE ENERGY: Registers $38.3MM Shares Under Incentive Plan -------------------------------------------------------------- Cheniere Energy, Inc., filed with the Securities and Exchange Commission a Form S-8 Registration Statement to register 1,000,000 shares of common stock, par value $0.003 per share, under the Cheniere Energy, Inc. 2003 Stock Incentive Plan, as amended to date, together with an indeterminate amount of Plan interests. The Proposed Maximum Aggregate Offering Price is $38,350,000. The number of previously registered shares had been adjusted to 2,000,000 shares of Common Stock to reflect the two-for-one stock split. The Company's Registration Statement No. 333-127266 previously registered 6,000,000 additional shares of Common Stock that may be issued under the Plan and included an indeterminate number of shares that may be issuable by reason of stock splits, stock dividends or similar transactions. Registration Statement No. 333-134886 previously registered 3,000,000 additional shares of Common Stock under the Plan that may be issued under the Plan and included an indeterminate number of shares that may be issuable by reason of stock splits, stock dividends or similar transactions. The aggregate number of shares issuable pursuant to the Plan and registered pursuant to the current and the earlier registration statements is 21,000,000 shares of Common Stock. Based in Houston, Texas, Cheniere Energy Inc. (AMEX: LNG) -- http://www.cheniere.com/-- is developing a network of three LNG receiving terminals and related natural gas pipelines along the Gulf Coast of the United States. Cheniere is pursuing related business opportunities both upstream and downstream of the terminals. Cheniere is also the founder and holds a 30.0% limited partner interest in a fourth LNG receiving terminal. As of March 31, 2009, Cheniere had $2.89 billion in total assets, $3.33 billion in total liabilities and $238.9 million in non- controlling interests, resulting in $683.9 million in stockholder's deficit and $444.9 million in total deficit. CHINA DIGITAL: Goodbye Kabani, Hello Goldman Parks -------------------------------------------------- The Board of Directors of China Digital Communication Group on June 10, 2009, dismissed Kabani & Company, Inc., as its independent registered public accounting firm. The Board appointed Goldman Parks Kurland Mohidin LLP as the Company's new independent registered public accounting firm. The Company's Board of Directors participated in and approved the decision to change the independent registered public accounting firm. Kabani's reports on the Company's financial statements for the years ended December 31, 2007 and 2008 and during the subsequent interim period through June 10, 2009, did not contain an adverse opinion or a disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles. According to the Company, during the years ended December 31, 2007, and 2008 and during the subsequent interim period through June 10, 2009, there were no disagreements on any matter of accounting principles or practices, financial statement disclosures, or auditing scope or procedures, which disagreements if not resolved to their satisfaction would have caused them to make reference in connection with Kabani's opinion to the subject matter of the disagreement. The Company also notes that, during the years ended December 31, 2007 and 2008 and during the subsequent interim period through June 10, 2009, the Company did not consult with GPKM regarding (1) the application of accounting principles to a specified transactions, (2) the type of audit opinion that might be rendered on the Company's financial statements, (3) written or oral advice was provided that would be an important factor considered by the Company in reaching a decision as to an accounting, auditing or financial reporting issues, or (4) any matter that was the subject of a disagreement between the Company and its predecessor auditor. About China Digital China Digital Communication Group and Subsidiaries Inc., (OTC: CHID) -- www.chinadigitalgroup.com/ -- changed its name and business in 2004, when it bought Billion Electronics and its wholly owned principal operating subsidiary, Shenzhen E'Jinie Technology Development, one of China's largest battery shell manufacturers. China Digital Communication Group now makes aluminum shells and battery caps for lithium ion batteries that are used in digital mobile devices, such as digital still cameras, cell phones, MP3 players, laptop computers, and PDAs. In 2006 the company acquired Galaxy View International for nearly $7 million in cash and stock; the following year, it sold Galaxy View for $3 million. The company is headquartered in Shenzhen, Guangdong, Republic of China. In an April 2008 filing with the U.S. Securities and Exchange Commission, Kabani & Company, Inc., raised substantial doubt about the ability of China Digital Communication Group and Subsidiaries Inc., to continue as a going concern after it audited the Company's financial statements for the year ended Dec. 31, 2007. The auditor pointed to the company's accumulated deficit of $12,078,964 at December 31, 2007, which included net losses for the years ended December 31, 2007 and 2006. CHRISTOPHER BELL: Case Summary & 18 Largest Unsecured Creditors --------------------------------------------------------------- Joint Debtors: Christopher Heaston Bell Dorothy Ann Bell 4702 North 68th Way Scottsdale, AZ 85251 Bankruptcy Case No.: 09-13897 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: James M. Marlar Debtors' Counsel: Donald W. Powell, Esq. Carmichael & Powell, P.C. 7301 N. 16th St., #103 Phoenix, AZ 85020 Tel: (602) 861-0777 Fax: (602) 870-0296 Email: d.powell@cplawfirm.com Total Assets: $2,054,336 Total Debts: $2,640,750 A list of the Company's 18 largest unsecured creditors is available for free at: http://bankrupt.com/misc/azb09-13879.pdf The petition was signed by the Joint Debtors. CJH DEVELOPMENT: Case Summary & Largest Unsecured Creditor ---------------------------------------------------------- Debtor: Cjh Development, LLC 56 E. Windmill Lane Las Vegas, NV 89123 Bankruptcy Case No.: 09-20663 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Bruce A. Markell Debtor's Counsel: Charles T. Wright, Esq. Piet & Wright 3130 S. Rainbow Blvd., Ste. 304 Las Vegas, NV 89146 Tel: (702) 566-1212 Fax: (702) 566-4833 Email: todd.wright@pietwright.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor identified Stearns-Bank with Parcel Nos. 177-16-101-002 & 177-16-101-009 claim for $4,000,000 as its largest unsecured creditor. A full-text copy of the petition is available for free at http://bankrupt.com/misc/nvb09-20663.pdf The petition was signed by Jeannie Kim, managing member of the Company. COMPLICATED LLC: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Complicated, L.L.C. aka MCI Properties, L.L.C. aka MCI Investments aka Suzuki of OKC, L.L.C. P.O. Box 6449 Norman, OK 73070 Bankruptcy Case No.: 09-13269 Chapter 11 Petition Date: June 20, 2009 Court: United States Bankruptcy Court Western District of Oklahoma (Oklahoma City) Debtor's Counsel: Jacqueline H. Burgos-Garritson, Esq. 1 N Hudson, Suite 520 Oklahoma City, OK 73102 Tel: (405) 272-4107 Fax: (405) 272-4108 Email: Burgosgarritsonlaw@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 Brenda Wyatt, manager of the Company. CONGOLEUM CORPORATION: Amends Business Relations Deal with ABI -------------------------------------------------------------- Congoleum Corporation disclosed in a filing with the Securities and Exchange Commission that it and American Biltrite, Inc., its controlling shareholder, entered into an Amendment to Business Relations Agreement, which extended the term of the Business Relations Agreement until the earlier of (a) the effective date of a Plan of Reorganization for the Company, after a final order of confirmation, or (b) March 31, 2010. The amendment was approved by the United States Bankruptcy Court for the District of New Jersey on June 9, 2009. The Company also related that on June 17, 2009, the Company and ABI entered into a Seventh Amendment to Personal Services Agreement, which extended the term of such Personal Services Agreement until the earlier of (a) the effective date of a Plan of Reorganization for the Company, after a final order of confirmation, or (b) March 31, 2010. The amendment was approved by the Court on June 9, 2009. A full-text copy of the Amendment to Business Relations Agreement is available for free at http://ResearchArchives.com/t/s?3e0b A full-text copy of the Seventh Amendment to Personal Services Agreement is available for free at: http://ResearchArchives.com/t/s?3e0c About American Biltrite American Biltrite Inc.'s (ABI) operations include its Tape Division; a controlling interest in K&M Associates L.P., a Rhode Island limited partnership (K&M), and ownership of a Canadian subsidiary, American Biltrite (Canada) Ltd. (AB Canada). The Tape Division produces adhesive-coated, pressure-sensitive papers and films used to protect material during handling or storage or to serve as a carrier for transferring decals or die-cut lettering. K&M is a designer, supplier, distributor and servicer of a variety of adult, children's and specialty items of fashion jewelry and related accessories throughout the United States and Canada. AB Canada produces resilient floor tile, rubber tiles and rolled rubber flooring and industrial products (including conveyor belting, truck and trailer splash guards and sheet rubber material) and imports certain rubber and tile products from China for resale. About Congoleum Based in Mercerville, New Jersey, Congoleum Corporation (OTC: CGMC) -- http://www.congoleum.com/-- manufactures and sells resilient sheet and tile floor covering products with a wide variety of product features, designs and colors. The Company filed for Chapter 11 protection on December 31, 2003 (Bankr. D. N.J. Case No. 03-51524) as a means to resolve claims asserted against it related to the use of asbestos in its products decades ago. Richard L. Epling, Esq., Robin L. Spear, Esq., and Kerry A. Brennan, Esq., at Pillsbury Winthrop Shaw Pittman LLP, and Paul S. Hollander, Esq., and James L. DeLuca, Esq., at Okin, Hollander & DeLuca, LLP, represent the Debtors. The Asbestos Claimants' Committee is represented by Peter Van N. Lockwood, Esq., and Ronald Reinsel, Esq., at Caplin & Drysdale, Chtd. The Bondholders' Committee is represented by Michael S. Stamer, Esq., and James R. Savin, Esq., at Akin Gump Strauss Hauer & Feld LLP. Nancy Isaacson, Esq., at Goldstein Isaacson, PC, represents the Official Committee of Unsecured Creditors. R. Scott Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, the Court-appointed Futures Claimants Representative, is represented by Roger Frankel, Esq., Richard Wyron, Esq., and Jonathan P. Guy, Esq., at Orrick Herrington & Sutcliffe LLP, and Stephen B. Ravin, Esq., at Forman Holt Eliades & Ravin LLC. American Biltrite, Inc. (AMEX: ABL), which owns 55% of Congoleum, is represented by Matthew Ward, Esq., Mark S. Chehi, Esq., Christopher S. Chow, Esq., and Matthew P. Ward, Esq., at Skadden Arps Slate Meagher & Flom. Various entities have filed bankruptcy plans for the Debtors. In February 2008, the legal representative for future asbestos- related claimants; the asbestos claimants' committee; the official Committee of holders of the Company's 8-5/8 % Senior Notes due August 1, 2008; and Congoleum jointly filed a joint plan of reorganization. Various objections to the Joint Plan were filed. In June 2008, the Bankruptcy Court issued a ruling that the Joint Plan was not legally confirmable. In August 2008, the Bondholders' Committee, the ACC, the FCR, representatives of holders of prepetition settlements and Congoleum entered into a term sheet describing the proposed material terms of a new plan of reorganization and a settlement of avoidance litigation with respect to prepetition claim settlement. Certain insurers and a large bondholder filed objections to the Litigation Settlement or reserved their rights to object to confirmation of the Amended Joint Plan. The Bankruptcy Court approved the Litigation Settlement in October 2008. The Amended Joint Plan was filed in November 2008. In January 2009, certain insurers filed a motion for summary judgment seeking denial of confirmation of the Amended Joint Plan. On February 26, 2009, the Bankruptcy Court rendered an opinion denying confirmation of the Amended Joint Plan. Moreover, the Bankruptcy Court dismissed Congoleum's bankruptcy case. On February 27, 2009, Congoleum and the Bondholders' Committee appealed the Order of Dismissal and the ruling denying plan confirmation to the U.S. District Court for the District of New Jersey. On March 3, the Bankruptcy Court stayed the Order of Dismissal pending entry of a final non-appealable decision affirming the Order of Dismissal. Appeal proceedings are underway before the District Court. CONSECO INC: Risk-Based Capital Ratio Benefits Under NAIC Action ---------------------------------------------------------------- Conseco, Inc., said a recent National Association of Insurance Commissioners action to modify the mortgage experience adjustment factor for 2009 will benefit its risk-based capital ratio. Conseco's life insurance subsidiaries are subject to risk-based capital requirements pursuant to statutory rules and regulations. To determine the amount of required risk-based capital, the regulations include a "mortgage experience adjustment factor" that is applied to the company's entire portfolio of commercial mortgage loans. At the recently concluded NAIC summer meeting, a proposal to modify the mortgage experience adjustment factor calculation was adopted for the year 2009. On a pro-forma basis as of March 31, 2009, the revised calculation reduces the amount of capital Conseco's insurance subsidiaries are required to hold, increasing the company's consolidated risk-based capital ratio by more than 25 points. "It is our understanding that the Capital Adequacy Task Force of the NAIC will monitor market conditions and progress on proposals that may result in modifying or extending the proposal beyond 2009. There can be no assurance that the short-term adjustment will continue beyond 2009," COnseco said in a statement. About Conseco Inc. Headquartered in Carmel, Indiana, Conseco Inc. (NYSE: CNO) -- http://www.conseco.com/-- is the holding company for a group of insurance companies operating throughout the United States that develop, market and administer supplemental health insurance, annuity, individual life insurance and other insurance products. The company became the successor to Conseco Inc. (Old Conseco), in connection with its bankruptcy reorganization. CNO focuses on serving the senior and middle-income markets. The company sells its products through three distribution channels: career agents, professional independent producers and direct marketing. CNO operates through its segments, which includes Bankers Life, Conseco Insurance Group, Colonial Penn, other business in run-off and corporate operations. * * * As reported in the Troubled Company Reporter on January 6, 2009, Fitch Ratings has downgraded the ratings assigned to Conseco Inc. The rating outlook on Conseco Inc. and its subsidiaries remains negative. Fitch downgraded these ratings: (i) issuer default rating to 'BB-' from 'BB'; (ii) senior secured bank credit facility to 'BB-' from 'BB+'; and (iii) senior unsecured debt to 'B' from 'BB-'. On March 4, 2009, A.M. Best downgraded the financial strength ratings of Conseco's primary insurance subsidiaries to "B" from "B+" and such ratings have been placed under review with negative implications. Conseco reported a first quarter 2009 net income of $24.5 million compared to a net loss of $7.2 million in the year-earlier quarter. Conseco had $28.5 billion in total assets, $26.9 billion in total liabilities, and $1.59 billion in stockholders' equity as of March 31, 2009. Conseco said it has significant indebtedness which will require over $165 million in cash to service in the next 12 months (including the additional interest expense required after the modification to its Second Amended Credit Facility. Pursuant to Conseco's Second Amended Credit Facility, Conseco must maintain certain financial ratios. The levels of margin between the financial covenant requirements and the Company's financial status, both at March 31, 2009, and the projected levels for the next 12 months, are relatively small and a failure to satisfy any of the financial covenants at the end of a fiscal quarter would trigger a default under the Second Amended Credit Facility. Achievement of the Company's operating plans is a critical factor in having sufficient income and liquidity to meet debt service requirements for the next 12 months and other holding company obligations and failure to do so would have material adverse consequences for the Company. COYOTES HOCKEY: Geographic Restriction in Contract Upheld --------------------------------------------------------- WestLaw reports that the requirement under a Chapter 11 debtor- franchise owner's agreement with a national hockey league that the franchise team play all of its home games in the designated city was not a contract term prohibiting, restricting, or conditioning the assignment of the agreement within the meaning of the Bankruptcy Code's anti-assignment statute authorizing a debtor's assumption and assignment of an executory contract despite a contract provision or other applicable law prohibiting, restricting, or conditioning the contract's assignment. Thus, the location restriction could not be excised from the contract under the statute, an Arizona bankruptcy court ruled, as a matter of apparent first impression, in a case that appeared to be the first in which a professional sports team sought to use rights under the Bankruptcy Code to force the sale and relocation of the team. In re Dewey Ranch Hockey, LLC, --- B.R. ----, 2009 WL 1702767 (Bankr. D. Ariz.). Dewey Ranch Hockey LLC, Arena Management Group, LLC, Coyotes Holdings, LLC, and Coyotes Hockey, LLC -- owners and affiliates of the Phoenix Coyotes National Hockey League team -- filed for Chapter 11 protection (Bankr. D. Ariz. Case No. 09-09488) on May 5, 2009. The Debtors are represented by Thomas J. Salerno, Esq., at Squire, Sanders & Dempsey, LLP, in Phoenix, and estimate their assets and liabilities are between $100 million and $500 million. As widely reported, Jim Balsillie, Research in Motion Ltd.'s co- chief executive officer, offered to buy the Phoenix Coyotes for $212 million and move the NHL team to Hamilton, Ontario, and the League balked at the relocation proposal. Mr. Balsillie was unsuccessful in 2007 when he attempted to buy and relocate the Nashville Predators, and lost a similar bid in 2006 to buy and relocate the Pittsburgh Penguins. CRITICAL ACCESS: Files for Chapter 11 Bankruptcy Protection ----------------------------------------------------------- The Associated Press reports that Critical Access Health Services Corp. has filed for Chapter 11 bankruptcy protect in the U.S. Bankruptcy Court for the Southern District of Indiana. Critical Access listed $1 million to $10 million in assets and $10 million to $50 million in debts. Critical Access said in a statement that it will negotiate for St. Vincent Health or another company to operate the hospital. St. Vincent, says The AP, will provide management services during the reorganization. Critical Access said in the bankruptcy petition that the hospital had assets between $1 million and $10 million and debts between $10 million and $50 million. Critical Access Health Services Corp., dba Washington County Memorial Hospital, is based in Salem, Indiana. CRYSTAL GARDEN: Seeks to Employ Wright Ginsberg as Counsel ---------------------------------------------------------- Crystal Garden Properties, L.P., seeks permission from Judge Harlin D. Hale of the U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division, to hire Wright Ginsberg Brusilow, P.C., as general counsel, pursuant to Section 327 of the Bankruptcy Code. Effective June 1, Wright Ginsberg agreed to, among other things, (i) take all necessary action to protect and preserve the Debtor's estate, (ii) to prepare on behalf of the Debtor all pleadings in connection with the administration of the estate, and (iii) to formulate, negotiate, and propose a plan of reorganization, if justified. The firm will charge the Debtor at its usual hourly rates and will seek reimbursement of all out-of-pocket expenses. Wright Ginsberg, its associates, shareholders, and other members, to the best of the Debtor's knowledge, do not hold or represent any interest adverse to the Debtor, or its estate, in the matters upon which said law firm is to be engaged. E.P. Keiffer, Esq., shareholder at Wright Ginsberg, disclosed that the firm represented Troy Clanton, who is 99% limited partner of the Debtor and 100% owner of the general partner of the Debtor in various matters, specifically with regard to Troy Clanton's involvement in Senior Management Services of Treemont, Inc., et al., (SMSA); Jointly Administered Under Case No. 07-30230-HDH-ll, which resulted in thc creation of the priority consensual second lien on the Debtor's real property. Counsel has and continues to represent Troy Clanton in defense of guaranty and other collection suits in State Court which arose out of the demise of SMSA and Troy Clanton's role as principal officer and director of those entities. Counsel is owed fees in excess of $75,000 by Troy Clanton, but not by the Debtor. WGB has no lien or lien interest in any interest held by any party with regard to this Debtor. Specific contingent creditors Rose Rabon and Kurt Ravenstein have agreed to allow fees of to be paid to WGB prior to the discharge of their lien position of up to $50,000 if the sales price for the real property is sufficient to convert their claims from contingent to actual. Crystal Garden Properties, L.P., filed for Chapter 11 on June 1, 2009 (Bankr. N.D. Tex. Case No. 09-43250). Judge Russell F. Nelms handles the case. In its bankruptcy petition, the Debtor disclosed total assets of $16,000,000 against debts of $6,431,074. DAN RIVER: PBGC Assumes Underfunded Pension Plans ------------------------------------------------- The Pension Benefit Guaranty Corporation assumed responsibility for the pensions of more than 6,000 former workers and retirees of Dan River Inc., a home textile products retailer in Danville, Va. The PBGC stepped in because Dan River is liquidating substantially all of its assets in bankruptcy proceedings. Additionally, the company's pension plans are insufficiently funded and would be unable to pay benefits when due. The three plans are the Dan River Inc. Hourly Retirement Plan, the Dan River Inc. Salary Retirement Plan, and the Bibb Company Pension Plan. Dan River retirees will continue to receive their monthly benefit checks without interruption, and other workers will receive their pensions when they are eligible to retire. Together, the plans are 46% funded, with assets of $40 million to cover $86 million in benefit liabilities. The agency expects to be responsible for the entire $46 million shortfall. The PBGC will take over the assets and use insurance funds to pay guaranteed benefits earned under the plan, which ended on Jan. 31, 2009. Within the next several weeks, the PBGC will send notification letters to all participants in Dan River's retirement plans. Under provisions of the Pension Protection Act of 2006, the maximum guaranteed pension the PBGC can pay is determined by the legal limits in force on the date of the plan sponsor's bankruptcy. Therefore, participants in the plan are subject to the limits in effect on April 20, 2008, which set a maximum guaranteed amount of $51,750 for a 65-year-old. The agency became trustee of the plan on June 8, 2009. The maximum guaranteed amount is lower for those who retire earlier or elect survivor benefits. In addition, certain early retirement subsidies and benefit increases made within the past five years may not be fully guaranteed. Workers and retirees with questions may consult the PBGC Web site, http://www.pbgc.gov/or call toll-free at 1-800-400-7242. For TTY/TDD users, call the federal relay service toll-free at 1-800- 877-8339 and ask for 800-400-7242. Dan River retirees who draw a benefit from the PBGC may be eligible for the federal Health Coverage Tax Credit. Assumption of the plan's unfunded liabilities will increase the PBGC's claims by approximately $24.1 million as the claim was previously included at a lower estimated amount in the agency's fiscal year 2008 financial statements, in accordance with generally accepted accounting principles. The PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974. It currently guarantees payment of basic pension benefits earned by 44 million American workers and retirees participating in over 29,000 private-sector defined benefit pension plans. The agency receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and by investment returns. Headquartered in Danville, Virginia, Dan River Inc. -- http://www.danriver.com/-- was a designer, manufacturer and marketer of home fashions and apparel fabrics such as comforters, bed sheets, and pillowcases. The company first sought bankruptcy protection on March 31, 2004 and emerged on Feb. 15, 2005. Dan River's operations were acquired by GHCL Ltd. in January 2006 for roughly $93 million consisting of $17 million in cash plus the assumption of $76 million in short- and long-term debt. The company attempted to restructure again outside of bankruptcy, but was unable to attract the necessary capital. The company filed for Chapter 11 protection for a second time on April 20, 2008 (Bankr. D. Del. Lead Case No. 08-10727). Margaret M. Manning, Esq., at Whiteford Taylor & Preston, LLP represents the Debtors in their restructuring efforts. The U.S. Trustee for Region 3 appointed creditors serve on an Official Committee of Unsecured Creditors. Donald J. Detweiler, Esq., Sandra G. Selzer, Esq., and Dennis A. Merino, Esq., at Greenberg Traurig, LLP represent the Creditors' Committee. In their schedules, Dan River Holdings LLC, et al. listed assets of $69,249,420 and debts of $143,294,152. In December 2008, the case converted to a Chapter 7 liquidation. E*TRADE FINANCIAL: Offers Zero Coupon Bonds for High-Yield Notes ---------------------------------------------------------------- E*TRADE FINANCIAL Corporation launched its debt exchange offer for certain of its outstanding high-yield notes, on the terms and subject to the conditions set forth in the Offering Memorandum and Consent Solicitation dated June 22, 2009 and the related letter of transmittal. The consummation of the Exchange Offer will be subject to certain conditions, including the closing of the Company's announced registered public offering which priced on June 18, 2009, shareholder approval and regulatory approval. Affiliates of Citadel Investment Group L.L.C., the Company's largest stock and bond holder, have agreed to participate in the Exchange Offer. The Company is offering to exchange more than $1 billion of newly- issued zero coupon Convertible Debentures due 2019 for all of its 8% Senior Notes due 2011 and a portion of its 12.5% Springing Lien Notes due 2017. The Company is offering to exchange $1,000 principal amount of Debentures for every $1,000 principal amount of the Notes tendered in the Exchange Offer. The Exchange Offer is designed to significantly reduce the Company's debt service burden by eliminating interest costs relating to those debt securities that are exchanged and lengthening the weighted-average maturity of its debt securities. The Debentures will have a maturity of 10 years and will be convertible into shares of common stock at an initial conversion price of $1.0340 per share for Class A Debentures and $1.5510 per share for Class B Debentures, which is 150% of the initial conversion price of the Class A Debentures. The terms of the Class A Debentures and the Class B Debentures will be identical except for the initial conversion price. Holders of the Notes that have tendered and not validly withdrawn their notes by midnight, New York City time, on July 1, 2009, will receive Class A Debentures and holders that tender their notes after such time and before the expiration of the Exchange Offer, will receive Class B Debentures. The Exchange Offer will expire at midnight, New York City time, on the date of the vote at the special shareholder meeting the Company will call to approve the issuance of the exchange consideration in the Exchange Offer under applicable NASDAQ Marketplace Rules, the issuance of up to 365 million shares of common stock in additional debt exchange offers and to increase the authorized shares of Company common stock, among other things, which is expected to occur in mid- August. Citadel has agreed to tender an aggregate principal amount of at least $800 million face value of the Company's long-term debt, including not less than $200 million face value of the 2011 Notes and not less than $600 million, nor more than $1 billion face value of the 2017 Notes, subject to reduction under certain circumstances. The Company is offering to exchange all of its 2011 Notes and up to $310 million of its 2017 Notes not held by Citadel on the same terms. As reported by the Troubled Company Reporter on June 18, 2009, the Company launched a registered public offering of $400 million of its common stock. The proceeds from the Common Stock Offering will provide additional equity capital, primarily for E*TRADE Bank and secondarily for other corporate purposes. Citadel has committed to place an order with the underwriters to purchase either $50 million or $100 million of stock in the Common Stock Offering, depending on the public offering price. The Company will solicit consents to amendments and waivers of certain provisions of the indentures governing the Notes during the period ending at midnight, New York City time, on July 1, 2009, unless extended. If the required consents are obtained, the Company will pay to holders that deliver a consent during the Early Tender Period, but do not tender the related Notes, a consent fee of $5.00 per $1,000 principal amount of Notes to which such consent relates. Holders tendering their Notes during the Early Tender Period will be automatically deemed to have delivered consent to each such amendment and waiver, and to have waived any consent fee, in each case as to their tendered Notes. Approval of the amendments requires, in each case, consent of a majority of the outstanding series of Notes, both including and excluding Notes held by Citadel. Citadel has agreed to tender Notes or provide consent as necessary to ensure that consents with respect to a majority of the aggregate principal amount of each of the 2011 Notes and 2017 Notes are delivered by the end of the Early Tender Period, and has waived its right to a consent fee with respect to any and all such Notes unless the exchange offer is not consummated. The Company's ability to execute the Exchange Offer requires, among other things, shareholder approval at the Special Meeting. In addition to approval by shareholders, the extent of Citadel's participation in the Exchange Offer is subject to approval from E*TRADE's primary federal banking regulator, the Office of Thrift Supervision. J.P. Morgan Securities Inc. has been retained as the Company's exclusive financial advisor in connection with the Exchange Offer. The Company is paying customary fees for these services and has agreed to indemnify it for certain liabilities. J.P. Morgan Securities Inc.'s compensation for its advisory services with respect to the Exchange Offer is in no way contingent on the results or the success of the exchange offer or consent solicitation relating to any outstanding notes, and J. P. Morgan Securities Inc. has not been retained to, and will not, solicit acceptances of the Exchange Offer or consents to any outstanding notes or make any recommendations with respect thereto. In connection with the Special Meeting, E*TRADE FINANCIAL Corporation will file a preliminary proxy statement with the Securities and Exchange Commission and expects to file and mail a definitive proxy statement to shareholders as soon as practicable. The definitive proxy statement and other documents also may be obtained for free from E*TRADE FINANCIAL Corporation, Attn: Corporate Secretary, 135 East 57th Street, New York, New York, 10022. E*TRADE FINANCIAL Corporation and its directors, executive officers and other members of management and employees may be deemed participants in the solicitation of proxies in connection with the Special Meeting. Information concerning the interests of these persons, if any, in the matters to be voted upon is set forth in the proxy statement. About E*TRADE FINANCIAL The E*TRADE FINANCIAL family of companies provides financial services including trading, investing and related banking products and services to retail investors. Securities products and services are offered by E*TRADE Securities LLC (Member FINRA/SIPC). Bank products and services are offered by E*TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries. * * * According to the Troubled Company Reporter on May 25, 2009, Standard & Poor's Ratings Services lowered its ratings, including the long-term counterparty credit and senior debt ratings, on E*TRADE Financial Corp. to 'CCC-' from 'B'. S&P also lowered S&P's counterparty credit and certificate of deposit ratings on E*TRADE Bank to 'CCC+' from 'BB-'. S&P has revised the CreditWatch to negative from developing, where the ratings were placed on December 22, 2008. As reported by the Troubled Company Reporter on May 18, 2009, Moody's Investors Service downgraded to Caa3 from B2 the ratings on the senior unsecured bonds of E*TRADE. Moody's also lowered to B3 from B2 E*TRADE's long-term issuer rating. All long-term ratings including those of E*TRADE's thrift subsidiary, E*TRADE Bank (BFSR at D-, Deposit Rating at Ba3), remain on review for possible downgrade, originally commenced on April 29, 2009. E*TRADE Bank's short-term rating remains Not-Prime. The downgrade of the bond ratings to Caa3 reflects the increased probability of material credit losses for E*TRADE's senior bondholders as a result of the company's stated strategy to employ debt-for-equity exchanges as the primary tool in reducing leverage and improving the company's precarious financial condition. E*TRADE said in a regulatory filing that it "anticipate[d] that the primary method for reducing [its] debt will involve debt-for- equity exchanges." E*TRADE FINANCIAL: S&P Cuts Counterparty Credit Rating to 'CC' -------------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its long- term counterparty credit rating on E*TRADE Financial Corp., as well as the senior debt ratings on the 8.0% notes due 2011 and the 12.5% springing lien notes due 2017, to 'CC' from 'CCC-'. At the same time, S&P affirmed the 'CCC-' senior debt rating on the 7.375% notes due 2013 and the 7.875% notes due 2015. S&P also affirmed the 'CCC+' counterparty credit and certificate of deposit ratings on E*TRADE Bank. S&P remove the ratings from CreditWatch- Negative, where they were placed May 21, 2009. The outlook is negative. The rating actions follow E*TRADE's announcement of a $400 million common equity offering and a debt exchange for two issues of long- term debt. "These actions, if successful, will modestly improve the bank's equity foundation, lengthen the maturity structure of the holding company's long-term debt, and materially lower interest servicing requirements. But S&P views these transactions as a short-term fix to a long-term problem," said Standard & Poor's credit analyst Charles D. Rauch. The holding company will still carry a relatively large amount of long-term debt on its balance sheet, and its financial capacity to service the remaining interest-bearing debt remains weak. The company is offering to exchange -- at par -- the 8.00% senior notes due 2011 and the 12.5% springing lien notes due 2017 for 10- year zero-coupon convertible notes. Because the exchange is under duress and bondholders are giving up substantial interest income, S&P consider this to be a distressed debt exchange. The Office of Thrift Supervision, E*TRADE Bank's chief regulator, had advised the company to increase capital at the bank and lower holding company debt. Failure to do so could lead to supervisory action. Even without the threat of supervisory action, S&P believes E*TRADE's financial capacity to service existing debt is weak. E*TRADE had $3.15 billion of outstanding debt at the holding company and $681 million of tangible common equity at the consolidated entity as of March 31, 2009. For these reasons, S&P believes the debt exchange is being conducted under duress and S&P is applying S&P's criteria for distressed exchange offerings. This means the ratings are lowered to 'CC'. Upon consummation of the exchange offer, S&P will lower the holding company counterparty credit rating to 'SD' (selective default) and lower the senior debt ratings on the 8.00% senior notes due 2011 and the 12.5% springing lien notes due 2017 to 'D' (default). The 7.375% notes due 2013 and the 7.785% notes due 2015 are not part of the exchange offer and, consequently, S&P's ratings on these are not affected. E*TRADE and E*TRADE Bank face a number of difficulties servicing holding-company debt. E*TRADE has not been profitable during the past two years. The bulk of the proceeds from the planned common stock offering will be downstreamed as equity into E*TRADE Bank, leaving the holding company with little additional cash. The negative outlook on E*TRADE reflects S&P's expectation that S&P will lower the counterparty credit ratings upon completion of the exchange offer. The negative outlook on E*TRADE Bank reflects S&P's concerns that profitability will remain weak in 2009 as the bank continues to address asset-quality problems, and could still be subject to adverse regulatory action. Notwithstanding some improving credit metrics in recent months, E*TRADE Bank could still burn through the new equity infusion to cover high credit losses in its large first-mortgage and home-equity loan books by year end. EASTBROOKE HOMES: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Eastbrooke Homes, LLC Suite 430, 3075 Breckinridge Blvd. Duluth, GA 30096 Bankruptcy Case No.: 09-22520 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Northern District of Georgia (Gainesville) Debtor's Counsel: Herbert C. Broadfoot, II, Esq. Ragsdale, Beals, Seigler, et al. 2400 International Tower 229 Peachtree Street, N.E. Atlanta, GA 30303 Tel: (404) 588-0500 Fax: (404) 523-6714 Email: broadfoot@rbspg.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/ganb09-22520.pdf The petition was signed by Norman B. White, managing member of the Company. EDDIE BAUER: Receives Notice of Delisting From Nasdaq ----------------------------------------------------- Eddie Bauer Holdings, Inc., received notice from the Nasdaq Stock Market that it has determined that the Company's common stock will be delisted from the Nasdaq Stock Market as a result of the Company's Chapter 11 and CCAA (Canadian) bankruptcy protection filings. The notification advises the Company that, in accordance with Listing Rules 5100, 5110(b) and IM 5100-1, unless the Company appeals the delisting determination, trading of the Company's common stock will be suspended at the opening of business June 26, 2009. At that time, unless appealed, the Nasdaq Stock Market will file a Form 25-NSE with the Securities and Exchange Commission, which will remove the Company's securities from listing and registration on the Nasdaq Stock Market. The notification listed the Company's bankruptcy filings as the primary reasons for the determination to delist the Company's common stock. About Eddie Bauer Established in 1920 in Seattle, Washington, Eddie Bauer is a specialty retailer that sells outerwear, apparel and accessories for the active outdoor lifestyle. The Eddie Bauer brand is a nationally recognized brand that stands for high quality, innovation, style and customer service. Eddie Bauer products are available at 371 stores throughout the United States and Canada, through catalog sales and online at http://www.eddiebauer.com/ Eddie Bauer participates in a joint venture in Japan and has licensing agreements across a variety of product categories. Eddie Bauer, Inc., was a subsidiary of Spiegel, Inc. Eddie Bauer Inc. emerged from Spiegel's 2003 chapter 11 case as a separate, reorganized entity under the control and ownership of Eddie Bauer Holdings, Inc. Eddie Bauer Holdings, Inc., and eight affiliates filed for bankruptcy on June 17, 2009 (Bankr. D. Del. Lead Case No. 09-12099). Judge Mary F. Walrath presides over the case. David S. Heller, Esq., Josef S. Athanas, Esq., and Heather L. Fowler, Esq., at Latham & Watkins LLP, serve as the Debtors' general counsel. Kara Hammond Coyle, Esq., and Michael R. Nestor, Esq., at Young Conaway Stargatt & Taylor LLP, serve as local counsel. The Debtors' restructuring advisors are Alvarez and Marsal North America LLC. Their financial advisors are Peter J. Solomon Company. Kurtzman Carson Consultants LLC acts as claims and notice agent. As of April 4, 2009, Eddie Bauer had $525,224,000 in total assets and $448,907,000 in total liabilities. Upon filing for bankruptcy, the Company entered into a "stalking horse" agreement with an affiliate of CCMP Capital Advisors LLC, under which CCMP Capital proposes to buy the Eddie Bauer business, subject to an auction and Bankruptcy Court approval, for $202 million in cash, with working capital and similar adjustments. CCMP Capital is a global private equity firm. CCMP Capital's legal advisor is Weil, Gotshal & Manges LLP. EDJ LLC: Case Summary & 5 Largest Unsecured Creditors ----------------------------------------------------- Debtor: EDJ, LLC 2139 Diamond Court Oldsmar, FL 34677 Bankruptcy Case No.: 09-13046 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's 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: $811,429 Total Debts: $1,342,130 A full-text copy of the Debtor's petition, including a list of its 5 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-13046.pdf The petition was signed by Edward J. Eady, managing member of the Company. EDRA BLIXSETH: Has Until June 29 to Decide on Assets ---------------------------------------------------- The Associated Press reports that Edra Blixseth has until June 29 to arrange how she will part with jewelry, furs, cars, houses, art and furniture. As reported by the Troubled Company Reporter on June 18, 2009, the Hon. Ralph B. Kirscher of the U.S. Bankruptcy Court for the District of Montana converted Ms. Blixseth's Chapter 11 reorganization case to a Chapter 7 liquidation proceeding. Acting U.S. Trustee Robert D. Miller Jr. said that Ms. Blixseth ignored "repeated requests" to show that her assets, allegedly worth millions of dollars, were insured. Judge Kirscher rejected Ms. Blixseth's appeal to reorganize her finances. Dan Bain at Kpic.com relates that Ms. Blixseth must let go of more than $107-million in assets to cover debts estimated to top $350-million in a sale process to be coordinated by the court- appointed trustee. Coachella Valley-based Edra D. Blixseth owns exclusive resorts in Rancho Mirage and near Yellowstone Park in Montana. She owns Porcupine Creek Golf Club in Rancho Mirage and the Yellowstone Club in Montana. Ms. Blixseth filed for Chapter 11 bankruptcy protection on March 26, 2009 (Bankr. D. Mont. Case No. 09-60452). Gary S. Deschenes, Esq., at Deschenes & Sullivan Law Offices assists Ms. Blixseth in her restructuring efforts. The Debtor listed $100 million to $500 million in assets and $500 million to $1 billion in debts. EMIGRANT BANCORP: Fitch Downgrades Issuer Default Ratings to 'B-' ----------------------------------------------------------------- Fitch Ratings has downgraded the long-term Issuer Default Ratings of Emigrant Bancorp, Inc. to 'B-'. In addition, Emigrant's subsidiary banks' long-term and short-term IDRs were both downgraded to 'B' and 'B', respectively. The Outlook is Negative. Emigrant Bancorp Inc: -- Long-term IDR downgraded to 'B-' from 'BB+'; -- Short-Term IDR affirmed at 'B'; -- Individual Rating downgraded to 'D/E' from 'C/D'; -- Senior Debt downgraded to 'CCC/RR6' from 'BB+'; -- Support affirmed at '5'; -- Support Floor affirmed at 'NF'. The rating action reflects significant degradation of asset quality metrics over the last six months. Using the latest regulatory report filed with the Federal Reserve Bank, nonperforming assets represent 11.3% of loans and other real estate on March 31, 2009. Previously, delinquencies had been focused on the residential loan book. Offsetting the high level of nonperforming assets in this book are conservative loan-to- values, which negated any recognition of losses upon disposition of the property. While this still may be the case, evidenced by net charge-offs representing only 6 basis points on March 31, 2009, Fitch does not view this as sustainable. More concerning is the deterioration in Emigrant's commercial book, which Fitch believes will likely lead to sharply higher charge-offs than historical experience. This will place renewed pressure on the capital position, should the reserve prove inadequate. While the level of loan loss reserves on March 31, 2009 has shown improvement, Fitch does not view the level of reserves and capital as sufficient given the current level of NPAs. A lack of earnings generation during the first quarter and in 2008, largely from write-downs in its securities book, has made capital building efforts more difficult. Since Fitch's last rating action in October 2008, Emigrant has taken several steps to augment its regulatory capital position. Foremost, it sold $267 million of preferred stock to the U.S. Treasury under its Capital Purchase Program. Consequently, regulatory capital ratios improved. The tangible common equity capital ratio still exhibits extreme stress on capital, declining to 1.36% on March 31, 2009 from 2.32% on Dec. 31, 2008. Recent investment sales and market pricing during the second quarter have improved capital ratios from the March 31, 2009 level. Tangible capital reflects the unprecedented movement of market prices in the security portfolio, which is primarily composed of securities issued by financial services companies. Regulatory capital ratios remain well capitalized as defined by capital regulation standards. Parent company liquidity on March 31, 2009 totaled $210.7 million, of which $26.4 million is cash and the remainder is highly liquid government securities. While the current level of liquidity provides substantial coverage for debt service on the preferred and other debt securities at the holding companies, the risk of regulatory authorities requiring capital augmentation at the regulated bank subsidiaries is elevated, in Fitch's opinion. Consequently, the level of liquidity at the holding companies could be adversely affected. The Negative Outlook reflects Fitch's concern about the level of capital and the ability to support the high level of NPAs. The following Emigrant subsidiaries have also been affected by the rating action, and Fitch has taken these actions: Emigrant Bank -- Long-term IDR downgraded to 'B' from 'BBB-'; -- Long-term Deposits downgraded to 'B+/RR2' from 'BBB'; -- Short-Term IDR downgraded to 'B' from 'F3'; -- Short-Term Deposits downgraded to 'B' from 'F3'; -- Individual Rating downgraded to 'D/E' from 'C'; -- Support affirmed at '5'; -- Support Floor affirmed at 'NF'. Emigrant Savings Bank - Manhattan -- Long-term IDR downgraded to 'B' from 'BBB-'; -- Long-term Deposits downgraded to 'B+/RR2' from 'BBB'; -- Short-Term IDR downgraded to 'B' from 'F3'; -- Short-Term Deposits downgraded to 'B' from 'F3'; -- Individual Rating downgraded to 'D/E' from 'C'; -- Support affirmed at '5'; -- Support Floor affirmed at 'NF'. Emigrant Savings Bank - Brooklyn/Queens -- Long-term IDR downgraded to 'B' from 'BBB-'; -- Long-term Deposits downgraded to 'B+/RR2' from 'BBB'; -- Short-Term IDR downgraded to 'B' from 'F3'; -- Short-Term Deposits downgraded to 'B' from 'F3'; -- Individual Rating downgraded to 'D/E' from 'C'; -- Support affirmed at '5'; -- Support Floor affirmed at 'NF'. Emigrant Savings Bank - Long Island -- Long-term IDR downgraded to 'B' from 'BBB-'; -- Long-term Deposits downgraded to 'B+/RR2' from 'BBB'; -- Short-Term IDR downgraded to 'B' from 'F3'; -- Short-Term Deposits downgraded to 'B' from 'F3'; -- Individual Rating downgraded to 'D/E' from 'C'; -- Support affirmed at '5'; -- Support Floor affirmed at 'NF'. Emigrant Savings Bank - Bronx/Westchester -- Long-term IDR downgraded to 'B' from 'BBB-'; -- Long-term Deposits downgraded to 'B+/RR2' from 'BBB'; -- Short-Term IDR downgraded to 'B' from 'F3'; -- Short-Term Deposits downgraded to 'B' from 'F3'; -- Individual Rating downgraded to 'D/E' from 'C'; -- Support affirmed at '5'; -- Support Floor affirmed at 'NF'. Emigrant Mercantile Bank -- Long-term IDR downgraded to 'B' from 'BBB-'; -- Long-term Deposits downgraded to 'B+/RR2' from 'BBB'; -- Short-Term IDR downgraded to 'B' from 'F3'; -- Short-Term Deposits downgraded to 'B' from 'F3'; -- Individual Rating downgraded to 'D/E' from 'C'; -- Support affirmed at '5'; -- Support Floor affirmed at 'NF'. Emigrant Capital Trust I -- Preferred Stock downgraded to 'CC/RR6' from 'BB-'. Emigrant Capital Trust II -- Preferred Stock downgraded to 'CC/RR6' from 'BB-'. ENVISION HOSPITALS: Failed Hospital Investment Led to Ch 7 Filing ----------------------------------------------------------------- Ken Alltucker at The Arizona Republic reports that Envision Hospital Corp. has filed for Chapter 7 bankruptcy protection in the U.S. Bankruptcy Court for the District of Arizona, listing less than $100,000 in assets and more than $15 million in debts. The Arizona Daily states that Envision Hospital's former corporate office on North Scottsdale Road, which had managed thousands of doctors and nurses and other hospital workers, is empty. Court documents say that Envision Hospital, then known as Doctors Community Healthcare Corp., acquired Hadley Memorial Hospital in Washington, D.C., for $10.3 million, with $1 million in cash. It assumed a $300,000 lease and financed the rest, according to court documents. The Arizona Daily quoted Pennsylvannia-based hospital consultant Joshua Nemzoff as saying, "His (Envision Hospital CEO Paul Tuft) model was to buy troubled assets." According to The Arizona Republic, Envision Hospital bought hospitals including: -- Greater Southeast Community Hospital in D.C., -- Michael Reese Hospital in Chicago, and -- Pacifica of the Valley hospital. The Arizona Republic states that Envision Hospital's strategy included taking bets on hospitals that other health-care companies deemed risky. The Arizona Republic states that Michael Reese Hospital deterred investors due to a labor dispute. The report says that Envision Hospital asked its physicians and workers to invest in the hospital through an employee stock-purchase plan, but those who provided credit to the hospital said that the deals couldn't hide its growing insolvency. The amount Envision Hospital owed to creditors increased to $460 million at the end of 2002, from $282 million at the end of 2000. The Arizona Republic reports that when National Century failed, Mr. Tuft orchestrated a deal to acquire the company's hospitals through the Bankruptcy Court. Citing analysts, The Arizona Republic states that competitive forces may have ultimately doomed the hospital corporation. According to The Arizona Republic, Mr. Nemzoff said that Envision Hospital never was able to gain a foothold in the large markets of Washington, D.C., and Chicago. The report states that the hospital never could negotiate good contracts with insurance companies and had trouble accessing capital. Envision Hospital then sold its Washington, D.C., hospitals amid pressure from the D.C. City Council, while its Michael Reese Hospital in Chicago is winding down operations and has filed for bankruptcy protection, the report says. According to the report, Pacifica of the Valley also collapsed. "They had a very difficult time competing. If you are a two-hospital town, then you can compete with one hospital. When you have 35 hospitals in (a larger market), you don't have that luxury," the report quoted Mr. Nemzoff as saying. Envision Hospital, says The Arizona Republic, lost accreditation from the Joint Commission, the industry's main accrediting body. The Arizona Republic states that Envision Hospital was also subjected to a Washington, D.C., Health Department inspection that yielded several violations for the hospital's staffing and a lack of medical equipment, while the City Council held a trio of hearings that included questions about the hospital's oversight. According to The Arizona Daily, Envision Hospital sold Hadley Memorial to Specialty Hospitals of America, and after one buyout deal failed, it sold Greater Southeast to Specialty Hospitals as part of a deal brokered and financed by the city. The report states that the city approved a $79 million package to let the sale proceed. The Arizona Daily relates that Tanya Curtis -- who provided management services under a contract with Envision's D.C. hospital, Greater Southeast Community Hospital -- filed a lawsuit against Envision Hospital and Mr. Tuft, and secured a almost $1.875 million settlement for herself and her company, T. Curtis & Co. After making an initial $330,000 payment, Envision Hospital failed to keep making payments per terms of the settlement, which prompted Ms. Curtis to sue the hospital again, seeking about $1.4 million from the earlier settlement. The report, citing Ms. Curtis' lawyer Manuel Geraldo, says that Ms. Curtis agreed to settle the first lawsuit, in part, because Mr. Tuft gave her a personal guarantee that she would be paid her money. The Arizona Daily reports that Healthcare Professionals Limited of Virginia, which provided health-care services and management for Envision Hospital, sued the Company and Mr. Tuft, claiming that the defendants failed to follow through on an agreement to pay Healthcare Professionals Limited $1 million. Mr. Tuft drained the hospital company of its assets for personal purposes and failed to follow through on an agreement, The Arizona Daily states, citing Healthcare Professionals. Envision Hospital Corporation, a healthcare management company, owns and operates hospitals with physician partners across the United States. It develops, manages, and partners with physicians and neighborhood groups to provide healthcare to local communities. Envision Hospital Corporation was founded in 1991 and is based in Scottsdale, Arizona. On May 1, 2009, Envision Hospital Corporation filed a voluntary petition for liquidation under Chapter 7 in the U.S. Bankruptcy Court for the District of Arizona. EXACT SCIENCES: Inks License Agreement with MAYO Foundation ----------------------------------------------------------- Exact Sciences Corporation on June 11, 2009, entered into a license agreement with MAYO Foundation for Medical Education and Research. MAYO granted the Company an exclusive, worldwide license within the field of stool or blood based cancer diagnostics and screening (excluding a specified proteomic target) with regard to certain MAYO patents and a non-exclusive worldwide license within the Field with regard to certain MAYO know-how. The License Agreement grants the Company an option to include the Proteomic Target within the Field upon written notice by the Company to MAYO during the first year of the term. The patent and know-how rights granted to the Company were developed by MAYO's Dr. David Ahlquist and researchers in his laboratory at MAYO. The licensed patents cover advances in sample processing, analytical testing and data analysis associated with non-invasive, stool-based DNA screening for colorectal cancer. Under the License Agreement, the Company assumes the obligation and expense of prosecuting and maintaining the licensed patents and is obligated to make commercially reasonable efforts to bring products covered by the licenses to market. The License Agreement obligates the parties to negotiate in good faith the terms of a sponsored research agreement with the goal of executing that agreement within 30 days of the effective date of the License Agreement. Under the License Agreement, the Company is required to make certain up-front, milestone and royalty payments to MAYO, as well as provide funding for future work in Dr. Ahlquist's lab. The License Agreement requires that the Company pay MAYO $80,000 within thirty days of the effective date. A milestone fee of $250,000 is due upon the commencement of patient enrollment in a human cancer screening clinical trial in support of a 510k or pre- market approval, and a milestone fee of $500,000 is due upon Food and Drug Administration approval. The License Agreement requires the Company to pay MAYO specified royalties based on sales of products or services covered by the licensed intellectual property. A minimum royalty of $10,000 is due on the third anniversary of the execution of the License Agreement and a minimum royalty of $25,000 is due on the fourth anniversary of the execution of the License Agreement and each anniversary thereafter during the term. The Company is obligated to support research in the laboratory of Dr. Ahlquist during the first year of the License Agreement at a minimum level of $500,000, subject to mutually agreed upon work plans and budgets and execution of the SRA. The Company is also obligated to reimburse MAYO for a portion of Dr. Ahlquist's salary and benefits. Also pursuant to the License Agreement, the Company is obligated to grant MAYO two warrants to purchase 1 million and 250,000 shares, respectively, of the Company's Common Stock. The warrants have six-year terms and are exercisable at a price of $1.90 per share. The 250,000 share warrant vests over four years at the rate of 62,500 shares per year (the six-year term extends from each vesting date with respect to the warrants vesting on that date). The warrants include a cashless exercise provision. About EXACT Sciences EXACT Sciences Corporation was incorporated in February 1995. The company has developed proprietary DNA-based technologies for use in the detection of cancer. The company has selected colorectal cancer as the first application of its technologies. The company has licensed certain of its technologies, including improvements to such technologies, on an exclusive basis through December 2010 to Laboratory Corporation of America(R) Holdings for use in a commercial testing service for the detection of colorectal cancer developed by LabCorp. The company has devoted the majority of its efforts to date on research and development and commercialization support of its colorectal cancer detection technologies. The audit opinion with respect to the company's consolidated financial statements for the year ended December 31, 2007, issued by its independent registered public accounting firm included an explanatory paragraph to emphasize that there is substantial doubt about the company's ability to continue as a going concern. On March 6, 2009, EXACT Sciences Corporation received a letter from The NASDAQ Stock Market for non-compliance of NASDAQ rules. If the Company does not regain compliance with the Rule by June 4, 2009, NASDAQ will provide the Company with written notification that the Company's common stock will be delisted from the NASDAQ Capital Market. EXACT SCIENCES: Sells Shares to Investors; Raises $8.2MM -------------------------------------------------------- Exact Sciences Corporation on June 11, 2009, entered into Securities Purchase Agreements with certain investors in connection with the private issuance and sale to those investors of the Company's common stock, $0.01 par value per share, at a per share price of $1.90, for an aggregate purchase price of $8.2 million. The per share price represents the average closing price for the Company's common stock for the ten days prior to the closing date. Pursuant to the Purchase Agreements, the Company consummated the sale of 4,315,792 shares of its Common Stock. The Company sold the Shares to certain accredited investors without registration under the Securities Act of 1933, as amended, or state securities laws, in reliance on the exemptions provided by Section 4(2) of the Act or Regulation D promulgated thereunder and in reliance on similar exemptions under applicable state laws. The Company has kept the identity of the buyers classified. EXACT Sciences Corporation was incorporated in February 1995. The company has developed proprietary DNA-based technologies for use in the detection of cancer. The company has selected colorectal cancer as the first application of its technologies. The company has licensed certain of its technologies, including improvements to such technologies, on an exclusive basis through December 2010 to Laboratory Corporation of America(R) Holdings for use in a commercial testing service for the detection of colorectal cancer developed by LabCorp. The company has devoted the majority of its efforts to date on research and development and commercialization support of its colorectal cancer detection technologies. The audit opinion with respect to the company's consolidated financial statements for the year ended December 31, 2007, issued by its independent registered public accounting firm included an explanatory paragraph to emphasize that there is substantial doubt about the company's ability to continue as a going concern. On March 6, 2009, EXACT Sciences Corporation received a letter from The NASDAQ Stock Market for non-compliance of NASDAQ rules. If the Company does not regain compliance with the Rule by June 4, 2009, NASDAQ will provide the Company with written notification that the Company's common stock will be delisted from the NASDAQ Capital Market. EXTENDED STAY: Creditors Panel Taps Hahn & Hessen as Counsel ------------------------------------------------------------ The official committee of unsecured creditors in the bankruptcy case of Extended Stay Hotels has hired Mark T. Power, Esq., and Gilbert Backenroth, Esq., at Hahn & Hessen LLP as counsel. Diana G. Adams, United States Trustee for Region 2, held a meeting on June 19, 2009, to form an unsecured creditors committee in the Debtors' cases. According to a notice of the meeting provided by the U.S. Trustee's office, a representative of the Debtors was to attend the meeting to provide information regarding the status of the cases. Messrs. Power and Backenroth, partners at their Firm's bankruptcy practice, filed on behalf of the Committee a Notice of Appearance and Request for Service of Papers. Mr. Powers has recently represented creditors' committees in bankruptcy proceedings including Pillowtex Corp., Cone Mills Corp., American Classic Voyages Corp., Cablevision Electronics Investment, Inc., and Joan & David's. Mr. Backenroth has represented asset-based lenders in insolvency proceedings involving borrowers in diverse sectors as oil and gas, health care, trucking, furniture, textile apparel, gold, jewelry, shipping, parcel and delivery service, sub-prime mortgage lending and the reorganization of a large NYC Coop Apartment Complex. A roster of the Creditors Committee members has not been made available in the Court docket. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. For the year ending December 31, 2008, Extended Stay's audited financial statements show consolidated assets (including nondebtor affiliates) totaling approximately $7.1 billion and consolidated liabilities totaling approximately $7.6 billion. Consolidated revenues for the 12 months ending December 31, 2008 were approximately $1 billion. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EXTENDED STAY: Judge Peck to Hold Initial Case Conference July 13 ----------------------------------------------------------------- Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York will hold an initial case management conference on July 13, 2009, at 10:00 a.m., to consider the efficient administration of the Chapter 11 cases of Extended Stay Inc. and its debtor affiliates. The initial case conference will be held at Room 601, United States Bankruptcy Court, One Bowling Green, in New York. Topics to be discussed during the conference include the retention of professionals, creation of a committee to review budget and fee requests, use of alternative dispute resolution, timetables, and scheduling of additional case management conferences. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. For the year ending December 31, 2008, Extended Stay's audited financial statements show consolidated assets (including nondebtor affiliates) totaling approximately $7.1 billion and consolidated liabilities totaling approximately $7.6 billion. Consolidated revenues for the 12 months ending December 31, 2008 were approximately $1 billion. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EXTENDED STAY: $4.1BB in CMBS to Complicate Bankruptcy Case ----------------------------------------------------------- Extended Stay Hotels wants to break up some $4.1 billion in commercial mortgage-backed securities' portfolios, Al Yoon and Nancy Leinfuss at Reuters relate. Lightstone Group LLC loaned some $7.4 billion to acquire Extended Stay Hotels from Blackstone Group LP in June 2007. About $4.1 billion of the loans came from a mortgage loan agreement among certain Extended Stay Entities with Wachovia Bank, N.A., Bear Stearns Commercial Mortgage, Inc., and Bank of America, N.A., as lenders. It took the form of commercial mortgage-backed securities. CBMS is a form of debt that used to apply to individual properties, The Financial Times notes. Real estate firms took on to it and it was widely utilized at the height of the real estate boom. In a CMBS transaction, many single mortgage loans of varying size, property type and location are pooled and transferred to a trust. The trust issues a series of bonds that may vary in yield, duration and payment priority. Recognized rating agencies then assign credit ratings to the various bond classes. Investors then choose which CMBS bonds to purchase based on the level of credit risk/yield/duration that they seek. Reuters notes that as the subprime mortgage crisis deepened, banks in mid-2007 found themselves with a huge backlog of CBMS, allowing buyers to be selective and shun the Extended Stay bonds as risks in Lightstone's inexperience in the hotel industry. Extended Stay filed for bankruptcy protection on June 15, 2009. The company related that prior to its bankruptcy filing, it pre- negotiated a term sheet with an ad hoc group of mortgage lenders. The Restructuring Term Sheet contemplates paying out holders of the $4.1 billion CBMS with (i) $1.8 billion in new three-tranche first lien mortgage loan, (ii) $775 million of a second lien mortgage loan, and (iii) about $471 million of new preferred stock in a new holding company, and 100% of common equity to be issued by a new holding company valued at $3.3 billion. Against this backdrop, Extended Stay may end up in the hands of veteran distressed investors Centerbridge Partners and Cerberus Management, Henry Sender of The Financial Times points out in a separate report. Amidst issues on the complexity of the Company's debt structure and objections to cash collateral use, Reuters says "initial signs point to a long, drawn-out battle in bankruptcy court for Extended Stay Hotels." About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. For the year ending December 31, 2008, Extended Stay's audited financial statements show consolidated assets (including nondebtor affiliates) totaling approximately $7.1 billion and consolidated liabilities totaling approximately $7.6 billion. Consolidated revenues for the 12 months ending December 31, 2008 were approximately $1 billion. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EXTENDED STAY: Gets Interim Approval to Use Cash Collateral ----------------------------------------------------------- Reuters reports that Extended Stay Inc. and its debtor-affiliates have been granted authority from the U.S. Bankruptcy Court for the Southern District of New York to use the cash collateral securing their obligations to prepetition lenders. Extended Stay seeks to use cash collateral to ensure uninterrupted payments of expenses for the operation of their properties and continue the range of services provided to their customer base. Jacqueline Marcus, Esq., at Weil, Gotshal & Manges LLP, in New York, counsel to Extended Stay, relates that certain of the Debtors are borrowers under a Mortgage Loan Agreement dated June 11, 2007, among the Debtor Borrowers; ESA P Portfolio MD Trust and ESA MD Properties Business Trust; ESA Canada Trustee, Inc. and ESA Canada Properties Trust or the "Maryland Owner;" ESA P Portfolio Operating Lessee Inc., ESA 2005 Operating Leesee Inc., ESA Canada Operating Lessee, Inc., and ESA Operating Lessee Inc. or the "Operating Lessee;" and Wachovia Bank, N.A., Bear Stearns Commercial Mortgage, Inc., and Bank of America, N.A. or the "Mortgage Lenders" for the provision of a $4.1 billion financing. The Mortgage Debt is secured by first priority mortgages on 666 properties of the Debtors. All of the Debtors' cash generated from the Mortgage Properties constitutes Cash Collateral. Subsequent to the closing of the Mortgage Loan Agreement, the Mortgage Lenders sold their interests in the Mortgage Debt to Wachovia Large Loan, Inc., which in turn, deposited the Mortgage Debt into a trust. Wachovia, Bank of America, and Merrill Lynch were the initial purchasers of the interests in the Trust and in turn, the Certificate Holders bought the interests held by those initial purchasers. The Certificate Holders were then issued certificates representing beneficial interests in the collateral vehicle holding the Mortgage Debt and other assets. Ms. Marcus relates that after extensive negotiations, the Certificate Holders who have reached an agreement in principle with the Debtors on the terms of a restructuring or the "Supporting Certificate Holders," have consented to the Debtors' use of the Cash Collateral pursuant to these terms: A. The parties with an interest in the Cash Collateral are the holder of the certificates representing beneficial interests in the collateral vehicle holding the Mortgage Debt and other assets, governed by a Trust and Servicing Agreement dated August 1, 2007, between Wachovia Large Loan, Inc., as depositor, Wachovia Bank, National Association, as servicer and special servicer, and Wells Fargo Bank, N.A., as trustee. B. The Debtors will use the Cash Collateral to pay expenses of operating their business in accordance with a budget, a copy of which is available for free at: http://bankrupt.com/misc/ExtendedStayBudget_trusept2009.pdf C. The use of the Cash Collateral will terminate on the earliest to occur of: (i) January 31, 2010, or (ii) three business days after the Termination Declaration Date; provided that if the final cash collateral use order is not entered by July 13, 2009, the Debtors will no longer be authorized to use Cash Collateral after July 17, 2009. D. Among the events of default are (1) the Debtors' failure to perform any of the covenants or obligations under the Interim Order; (2) dismissal of the Chapter 11 cases or conversion of the Chapter 11 cases to Chapter 7 cases, or the appointment of a Chapter 11 trustee; (3) the sale of any material portion of the Debtors' assets outside the ordinary course of business without the prior written consent of the Supporting Certificate Holders; (4) the filing of a Chapter 11 Plan that deviates or is inconsistent in any material respect with the Restructuring Term Sheet dated June 12, 2009 agreed to by the Debtors and Supporting Certificate Holders; (5) failure to make adequate protection payments; and (6) failure to comply with the budget. E. The Mortgage Debt Parties, as the beneficial holders of the Mortgage Debtor, will receive: (1) adequate protection payments from the Debtors in an amount equal to the interest at the non-default contract rate that is payable to that class of Certificates under the Mortgage Debt and the Trust and Servicing Agreement, ongoing payment of the reasonable fees, costs and expenses of Fried Frank Harris Shriver & Jacobson LLP and Houlihan Lokey Howard & Zukin and, with respect to the fees incurred subsequent to the Petition Date, the reasonable fees, costs and expenses of Schulte Roth & Zabel LLP, and continued maintenance and insurance of the Collateral; (2) additional and replacement continuing valid, binding, enforceable, non-avoidable and automatically perfected security interests and liens on all of the Debtors' assets, provided that the Postpetition Collateral will not include the Debtors' claims and causes of action under Section 544, 545, 547, 548, 549 or 559 of the Bankruptcy Code; and (3) an allowed superpriority administrative claim under Sections 503(b) and 507(b) of the Bankruptcy Code in the amount of the Adequate Protection Obligations. F. Carve Out refers to: (1) statutory fees payable to the U.S. Trustee; (2) fees payable to the Clerk of the Bankruptcy Court; (3) reasonable fees and expenses of a trustee that are incurred after the conversion of the Chapter 11 cases to a case under Chapter 7 of the Bankruptcy Code, of up to $50,000; (4) reasonable and documented expenses payable to members of the Creditors Committee; and (5) professional fees and expenses incurred by professionals retained pursuant to Section 327 of the Bankruptcy Code by the Debtors and the Creditors Committee subsequent to the delivery of a Carve-Out Trigger Notice, in an aggregate amount not more than $10 million. The Adequate Protection Liens are junior to the Carve Out. The Debtors aver that without the immediate liquidity provided by the use of Cash Collateral, they will simply be unable to conduct normal business operations and their estates will be irreparably harmed. Objections Bank of America and Five Mile Capital II SPE ESH LLC objected to the Debtors' request. BofA and FMC don't oppose the limited use of Cash Collateral for the purpose of paying necessary operating expenses, but they don't agree to Cash Collateral use for the expenses of non-debtors. BofA and FMC contend, among other things, that: 1. The Debtors' valuation precludes payment of postpetition interest and fees. The Debtors' court filings value their assets at $3.3 billion and thus, the value of the Prepetition Collateral is well below the outstanding secured $4.1 billion Mortgage Debt. 2. Certificate Holders are not entitled to fees and expenses pursuant to the operative documents or the law. 3. The Secured Creditor is the Wachovia Trust and not the so- called "Supporting Certificate Holders." The Debtors have failed to establish that the actual secured party has consented to the use of the Cash Collateral. 4. It is improper to establish a $5 million Litigation Reserve for use by David Lichtenstein against claims that may be brought against him under the guaranties he issued for the benefit of the Mezzanine Lenders. The Debtors have failed to demonstrate basis to justify the proposed litigation reserve for the benefit of a non-debtor to defend claims arising from his personal contractual obligations. 5. Management fees must be closely scrutinized as the Cash Collateral request provide for the payment of more than $20 million in management fees to HVM LLC, a company controlled by Mr. Lichtenstein. 6. There should not be any presumption that the use of Cash Collateral constitutes diminution in the value of the Prepetition Collateral, as the adequate protection obligations make up for the decline in value resulting from any use of Cash Collateral. 7. Default interest should not automatically accrue. 8. A request to pay an undisclosed amount for the costs and expenses of Fried, Frank, Harris, Shriver & Jacobson LLP, Houlihan Lokey Howard & Zukin and Schulte Roth & Zabel LLP should be clarified. These firms solely represent the interests of the "Supporting Certificate Holders." BofA, together with other lenders, entered into 10 different mezzanine loan agreements with certain of the Debtors referred to as the Mezzanine Borrowers. As of the Petition Date, BofA held claims of more than $950 million against the Borrowers on account of the Mezzanine Loans. FMC is the holder of $22,267,484 face amount of the Class F tranche of certificates of the Wachovia Bank Commerical Mortgage Trust, Series 2007-ESH. The Trust is the holder of a single $4.1 billion mortgage loan. In a separate filing, prepetition secured lenders Line Trust Corporation, Ltd., and Deuce Properties, Ltd., argue the Debtors' Cash Collateral Use request demonstrates collusive conduct between the Debtors' common equity holder, Mr. Lichtenstein, and the senior lenders. Stuart I. Rich, Esq., at Meister Seelig & Fein LLP, in New York, says the senior lender tranches have apparently structured a deal with Mr. Lichtenstein to protect him personally on his springing recourse carve out guarantee on the entire $7.4 million debt stack, including a $100 million indemnity and $5 million war chest to fight any mezzanine lenders who seek springing recourse liability against Mr. Lichtenstein under binding carve out guaranties. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. For the year ending December 31, 2008, Extended Stay's audited financial statements show consolidated assets (including nondebtor affiliates) totaling approximately $7.1 billion and consolidated liabilities totaling approximately $7.6 billion. Consolidated revenues for the 12 months ending December 31, 2008 were approximately $1 billion. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). EXTENDED STAY: Gets Interim Approval to Reimburse HVM ----------------------------------------------------- Extended Stay Inc. and its affiliates sought and obtained the authority from the U.S. Bankruptcy Court for the Southern District of New York, on an interim basis, to reimburse, at their sole discretion, HVM LLC for amounts due to pay certain "critical operating expenses" incurred by HVM on their behalf before the Petition Date. HVM manage the Debtors' hotels. It is an entity affiliated with, but not directly owned by, the Extended Stay family of companies. Among other things, HVM employs about 10,000 employees that are responsible for the services at the individual hotels. HVM also enters into contracts with utility providers and other vendors that directly provide critical services to the hotels. The Critical Operating Expenses that HVM makes payments for include (a) salaries of about 10,000 employees, (b) utility payments, (c) repair and maintenance payments, (d) property taxes, (e) insurance payments, and (f) reservation and travel agent fees, according to Jacqueline Marcus, Esq., at Weil, Gotshal & Manges LLP, in New York, proposed attorneys for the Debtors. The ability of HVM to continue the operation of the Extended Stay portfolio of hotels going forward will depend on uninterrupted, continued access to the services provided by certain providers of essential services to the Debtors' properties, Ms. Marcus says. The Debtors aver that they are mindful of their fiduciary obligations to maximize value of their estates and thus, determine that it is critical that they continue to reimburse HVM in order to effectuate the seamless transition to a business operating under Chapter 11. The Debtors will be making reimbursements to HVM for the Critical Operating Expenses pursuant to the Cash Collateral Motion and Budget. The Debtors estimate that a portion of the reimbursements to HVM will encompass payments due and owing to certain employees and service providers incurred before the Petition Date, including: -- $7,300,000 due and owing to HVM employees, -- $165,000 due to HVM officers, -- $3,725,000 due to utility companies, -- $2,850,000 due for overhead expenses, -- $4,300,000 due for essential capital expenditures, -- $4,900,000 due for occupancy tax deposits, -- $2,600,000 due for property tax payments, and -- $12,500d due for interest on a mortgage. As of June 12, 2009, HVM had about $11.7 million to make payments to employees, vendors and service providers for the Critical Operating Expenses incurred on the Debtors' behalf prepetition. Thus, the Debtors seek to reimburse HVM for the $22.8 million it needs for Operating Expenses during the 20 days after the Petition Date. The Court will convene a final hearing on the Debtors' request on June 29, 2009. About Extended Stay Extended Stay is the largest owner and operator of mid-price extended stay hotels in the United States, holding one of the most geographically diverse portfolios in the lodging sector with properties located across 44 states (including 11 hotels located in New York) and two provinces in Canada. As a result of acquisitions and mergers, Extended Stay's portfolio has expanded to encompass over 680 properties, consisting of hotels directly owned or leased by Extended Stay or one of its affiliates. Extended Stay currently operates five hotel brands: (i) Crossland Economy Studios, (ii) Extended Stay America, (iii) Extended Stay Deluxe, (iv) Homestead Studio Suites, and (v) StudioPLUS Deluxe Studios. For the year ending December 31, 2008, Extended Stay's audited financial statements show consolidated assets (including nondebtor affiliates) totaling approximately $7.1 billion and consolidated liabilities totaling approximately $7.6 billion. Consolidated revenues for the 12 months ending December 31, 2008 were approximately $1 billion. Extended Stay Inc. and its affiliates filed for Chapter 11 on June 15, 2009 (Bankr. S.D.N.Y. Case No. 09-13764). Judge James M. Peck handles the case. Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New York, represents the Debtors. Lazard Freres & Co. LLC is the Debtors' financial advisors. Kurtzman Carson Consultants LLC is the claims agent. Bankruptcy Creditors' Service, Inc., publishes Extended Stay Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings undertaken by Extended Stay Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). FINLAY ENTERPRISES: In Default Under GECC Revolving Loan -------------------------------------------------------- Finlay Enterprises Inc. says it is currently in default of a covenant under the February 2009 amendment to the Company's revolving credit agreement with General Electric Capital Corporation, as agent, which requires the Company to achieve certain weekly targeted percentages of sales and cash receipts and maintain cash disbursements below certain targeted percentages as set forth in the Company's operating plan. Although the lenders reserve all rights and remedies under the Revolving Credit Agreement and can accelerate repayment of the outstanding balance at any time, they have not exercised those rights at this time other than to impose the default interest rate under the Revolving Credit Agreement effective June 1, 2009. As a result of cross-default provisions, an acceleration would enable the holders of the Company's long-term debt to declare a default and demand repayment as well. As the long-term debt is not callable by its holders as of May 2, 2009, it is not classified as a current liability at such date. Finlay says there can be no assurances it will be able to obtain alternate financing on acceptable terms. In the event Finlay is unable to secure adequate borrowing under the Revolving Credit Agreement or an alternate financing source, its cash flows from operations may be inadequate to meet its obligations, which may prevent the Company from operating. Strategic Plan As a result of the decline in the Company's licensed department store based business over the past several years coupled with challenging economic conditions in 2008 and 2009, Finlay announced in February 2009, a plan to exit the licensed department store- based business. In addition, Finlay anticipates closing roughly half of its specialty jewelry stores in 2009. The implementation of the strategic plan will result in a significant reduction in the Company's sales. The plan includes the liquidation of inventory and the termination of license agreements or leases in the affected department store based fine jewelry departments and specialty jewelry stores. Finlay views the execution of the strategic plan as crucial to strengthening the financial condition of its specialty jewelry store business. Finlay is in the process of reducing its cost structure to levels appropriate to support the specialty jewelry store business, which includes significantly reducing headcount in its administrative and distribution center functions as well as eliminating sales associate positions in the affected department stores and specialty store locations. By the end of May 2009, roughly 2,100 employees either left or were severed from the Company. Finlay expects to complete its strategic plan by the end of 2009. Revolving Credit Facility In conjunction with the adoption of the strategic plan, Finlay Jewelry amended its revolving credit agreement in February 2009, as adjusted in March 2009, to reduce the senior secured revolving line of credit from $550.0 million to $266.6 million and to increase the interest rates thereunder. The amendment also requires the Company to comply with various milestones in connection with the strategic plan, to provide additional financial reporting to the lenders and to maintain compliance with a variance covenant from the approved restructuring budget. Additionally, the Revolving Credit Agreement now matures in February 2010 instead of the previous maturity date of November 2012. The net sales proceeds from the liquidation of inventory are being used to repay the Company's outstanding balance under Finlay Jewelry's Revolving Credit Facility in 2009. Going Concern Doubt According to Finlay, its ability to continue as a going concern is dependent on the successful implementation of its strategic plan, the repayment of the amounts due under the Revolving Credit Facility and its ability to obtain a new line of credit on or before the maturity date of the Revolving Credit Agreement. In addition, Finlay experienced a significant operating loss in 2008, it incurred an operating loss in the first quarter of 2009, and it is expected to incur operating losses for the remainder of 2009. "These uncertainties raise substantial doubt about our ability to continue as a going concern," Finlay says. On March 22, 2009, Finlay completed the sale of certain assets to Bloomingdale's. The assets included inventory and fixed assets for the 34 departments that it operated in Bloomingdale's for a purchase price of roughly $33.4 million. The proceeds from the transaction were used to pay-down a portion of the outstanding balance under Finlay Jewelry's Revolving Credit Facility. Finlay reported total assets of $430,023,000 and total liabilities of $451,679,000, resulting in $21,656,000 in shareholders' deficit as of May 2, 2009. It posted a net loss of $28,669,000 on sales of $159,321,000 for the 13 weeks ended May 2, 2009, compared to a net loss of $11,011,000 on sales of $142,072,000 for the 13 weeks ended May 3, 2009. About Finlay Enterprises Finlay Enterprises, Inc. (OTC Bulletin Board: FNLY) through its wholly-owned subsidiary, Finlay Fine Jewelry Corporation, is one of the leading retailers of fine jewelry operating luxury stand- alone specialty jewelry stores and licensed fine jewelry departments in department stores throughout the United States and achieved sales of $754.3 million in fiscal 2008. The number of locations at the end of the first quarter of fiscal 2009 totaled 476, including 68 Bailey Banks & Biddle, 34 Carlyle and five Congress specialty jewelry stores. FIRSTFED FINANCIAL: Offers 20 Cents on the Dollar for Debentures ---------------------------------------------------------------- FirstFed Financial Corp. commenced cash tender offers and consent solicitations for its outstanding senior debt securities. The terms and conditions of the tender offers and consent solicitations are described in the Offer to Purchase and Consent Solicitation Statement, dated June 19, 2009, and the related Letter of Transmittal and Consent, which is being mailed to holders of the Securities. Principal Tender CUSIP Amount Offer Consent Purchase Nos. Outstanding Title of Security Price Payment Price ----- ----------- ----------------- ------ ------- -------- 3379079Z4 $50,000,000 Fixed/Floating Rate $180.00 $20.00 $200.00 Senior Debt Debentures due June 15, 2015 337907AB5 $50,000,000 Fixed/Floating Rate $180.00 $20.00 $200.00 Senior Debt Debentures due March 15, 2016 337907AC3 $50,000,000 Fixed/Floating Rate $180.00 $20.00 $200.00 Senior Debt Debentures due June 15, 2017 -- Per $1,000 principal amount of Securities. The tender offer and consent solicitation will expire at 5:00 p.m., New York City time, on August 10, 2009, unless extended or earlier terminated by the Company. To be eligible to receive the purchase price, which includes the consent payment, holders must validly tender, and not validly withdraw, their Securities prior to 5:00 p.m., New York City time, on July 27, 2009, unless extended or earlier terminated by the Company. Holders tendering their Securities after the applicable Consent Payment Deadline but prior to the applicable Expiration Date will be eligible to receive an amount equal to the purchase price less the consent payment. Securities purchased in the tender offers will be paid for on the applicable settlement date for each tender offer, which, assuming the tender offers are not extended, will be promptly after the applicable Expiration Date. Holders tendering their Securities will be required to consent to the proposed amendments to the indentures governing the Securities, which would eliminate substantially all of the restrictive covenants in the indentures, including the covenant that currently prohibits the Company from merging or selling all or substantially all of its assets unless the successor entity or purchaser is substituted as the obligor. Holders may not tender their Securities without also delivering consents and may not deliver consents without also tendering their Securities. Holders may withdraw tendered Securities and revoke the related consent at any time prior to the earlier of (i) 5:00 p.m., New York City time, on July 27, 2009 and (ii) the time and date indicated in a notice to the relevant trustee and announced when the Company has received valid tenders and the related consents from holders of at least 75% in principal amount of the relevant series of Securities, or a majority in principal amount of the relevant series if this condition is waived. Consummation of each tender offer and consent solicitation is conditioned upon satisfaction or waiver of the conditions set forth in the Offer to Purchase, including (i) the Company's receipt of net proceeds from an offering, sale or other transaction -- Financing Transaction -- sufficient to enable the Company to purchase the Securities that are validly tendered and not withdrawn -- Financing Condition -- (ii) approval by the Office of Thrift Supervision of the Company's payment of the purchase price for the Securities that are validly tendered and not withdrawn and (iii) the Company's receipt of tenders and consents from holders of at least 75% in principal amount of each and every series of Securities subject to the tender offers and consent solicitations -- Minimum Tender/Consent Condition. The Company has reserved the right to waive any condition to any tender offer and consent solicitation. The Company is exploring a variety of options for raising the funds necessary to satisfy the Financing Condition, including the sale by the Company or First Federal Bank of California of additional equity or debt securities, the sale by the Company of its common stock of the Bank, and the sale by the Bank of its assets. The Company is exploring financing options in good faith and will use its reasonable efforts to satisfy the Financing Condition prior to the expiration of the Tender Offers, but there can be no assurance that the Financing Condition will be satisfied. The Company's ability to consummate a Financing Transaction, as well as the timing of any such transaction, is highly uncertain. If it does consummate a Financing Transaction, that transaction may not occur until after the Withdrawal Deadline. Based upon preliminary discussions with prospective counterparties to a Financing Transaction and with the bank's advisors, the bank believes that the closing of any Financing Transaction will be conditioned on the consummation of all of the tender offers and consent solicitations. Goldman, Sachs & Co. is acting as dealer manager for the tender offers and as solicitation agent for the consent solicitations. For additional information regarding the terms of the tender offers and consent solicitations, please contact Goldman, Sachs & Co. at (800) 828-3182 (toll free). Requests for documents may be directed to the Corporate Secretary of the Company at (310) 302-5600. About FirstFed Financial FirstFed Financial Corp. -- http://www.firstfedca.com/-- is a savings and loan holding company. The Company owns and operates First Federal Bank of California, a federally chartered savings association. The Company's principal executive offices are located at 12555 W. Jefferson Boulevard, Los Angeles, California 90066, and its telephone number is (310) 302-5600. Detailed Capital Plan Due June 28 On May 28, 2009, FirstFed and First Federal Bank of California, FSB, consented to the issuance of an Amended Order to Cease and Desist by the Office of Thrift Supervision. The Amendments amend and supplement the Orders to Cease and Desist that were issued by the OTS on January 26, 2009. The Amendments require that the Company and Bank submit to the OTS within 30 days a detailed capital plan to address how the Bank will meet and maintain a minimum Tier 1 Core Capital ratio of 7% and a minimum Total Risk-Based Capital ratio of 14% by September 30, 2009. The capital plan must address how the Bank will meet and maintain the capital ratios and provide for the augmentation of capital to, among other things, support the Bank's business strategy and operations. If the Bank fails to meet or maintain the capital ratios or otherwise fails to comply with the updated capital plan, the Bank must then submit to the OTS a contingency plan to accomplish either a merger with or acquisition by another federally insured institution or holding company thereof, or a voluntary liquidation of the Bank. The Bank Amendment also provides that the Bank may not accept, renew or roll over any broker deposits, or act as a deposit broker, without the prior written approval of the Federal Deposit Insurance Corporation. Any material failure to comply with the provisions of the Amendments could result in enforcement actions by the OTS. While the Company and the Bank each intend to take such actions as may be necessary to enable it to comply with the requirements of its respective Amendment, there can be no assurance that it will be able to comply fully with the provisions of such Amendment, or to do so within the timeframes required, that compliance with such Amendment will not be more time consuming or more expensive than anticipated, or that efforts to comply with such Amendment will not have adverse effects on its operations and financial condition. FIRSTGOLD CORP: Working With Advisors to Restructure Company ------------------------------------------------------------ Firstgold Corp. continues to work with its advisor Haywood Securities in evaluating options on the sale and or restructuring of the Company. "The process is advancing, however, at this time we do not have anything concrete in our hands that would satisfy our existing creditors and allow the Relief Canyon Mine to get back to production," commented Steve Akerfeldt, Firstgold CEO. He added that the Company has also reduced its overhead expenses by closing its Cameron Park offices and consolidating its operations at its offices in Lovelock, Nevada in addition to reducing its mining workforce to a care and maintenance status. Mr. Akerfeldt provided this update statement: "To enable Firstgold to buy time for a positive restructuring process to take place, Firstgold has completed some interim financing with existing stakeholders in the Company. It has secured approximately $500,000 in capital for the Company. $300,000 came in as new capital and another $200,000 reflects compensation converted to debt in lieu of pay for staff and directors. The money was advanced and compensation converted in the form of convertible promissory notes, with a 12% interest rate, repayable on demand or convertible into stock at 15 cents per share. As a further incentive, the note holders were given an option to buy 4000 ounces of gold at $500. The gold would be delivered only after all existing creditors have been repaid. These funds are being used to maintain the Company's core asset, the Relief Canyon Mine. "While we continue to work daily with our secured creditors on the restructuring process, they are asserting their legal rights including initiating foreclosure proceedings relating to the Company's mining properties. In addition, they have recently filed a suit to have a receiver appointed to run the affairs of the Company. There is a hearing scheduled on the matter in Nevada court on July 8, 2009, at which point a receiver could be appointed unless the matter is resolved in some other manner which could include the Company filing for bankruptcy protection. "Further, the secured lenders have given us a letter making various allegations against the Company and certain key personnel including fraud, misrepresentations, and breach of fiduciary duty in the process of securing the loan from them. The letters provide no facts supporting such allegations and demand unspecified damages. Firstgold, its officers and directors strongly deny such claims and believe they are groundless and intended to place additional pressure on our management team to complete a restructuring transaction acceptable to the secured creditors. "We acknowledge these are challenging times and we will continue to work through these issues for a solution that provides the best outcome for all of our Stakeholders." Over the last 24 months, Firstgold Corp. (OTCBB: FGOC) -- http://www.firstgoldcorp.com/-- has spent $16 million developing the mine property and a processing facility at Relief Canyon, located outside Lovelock Nevada, on the site of the previously producing Pegasus Gold Mine. FLYING J: Magellan Selected as Lead Bidder of Longhorn Partners --------------------------------------------------------------- Magellan Midstream Partners, L.P., has been selected as the "stalking horse" bidder for substantially all of the assets of Longhorn Partners Pipeline, L.P., a unit of Flying J. Completion of the acquisition is subject to an auction process, bankruptcy court approval and customary regulatory approval. The 700-mile common carrier pipeline system transports refined petroleum products from Houston to El Paso, Texas. A terminal in El Paso, comprised of a 5-bay truck loading rack and over 900,000 barrels of storage, is included in the purchase. This terminal serves local petroleum products demand and distributes product to connecting third-party pipelines for ultimate delivery to markets in Arizona, New Mexico and in the future to Northern Mexico. Magellan currently serves as the operator of the pipeline system. The purchase price for the pipeline system is $250 million plus the fair market value of line fill, which is currently estimated at approximately $90 million. Management intends to finance the acquisition with debt. About Magellan Midstream Partners Magellan Midstream Partners, L.P. -- http://www.magellanlp.com/-- is a publicly traded partnership formed to own, operate and acquire a diversified portfolio of energy assets. The partnership primarily transports, stores and distributes refined petroleum products. MMP's general partner interest and related incentive distribution rights are owned by Magellan Midstream Holdings, L.P. About Flying J Based in Ogden, Utah, Flying J Inc. -- http://www.flyingj.com/-- is engaged in the exploration and refining of petroleum products. It also operates about 200 travel plazas in 41 states and six Canadian provinces. The Company and six of its affiliates filed for Chapter 11 protection on December 22, 2008 (Bankr. D. Del. Lead Case No. 08-13384). Attorneys at Kirkland & Ellis LLP represent the Debtors as counsel. Young, Conaway, Stargatt & Taylor LLP is the Debtors' Delaware Counsel. Blackstone Advisory Services L.P. is the Debtors' investment banker and financial advisor. Epiq Bankruptcy Solutions LLC is the Debtors' notice, claims and balloting agent. In its formal schedules submitted to the Bankruptcy Court, Flying J listed assets of $1,433,724,226 and debts of $640,958,656. An official committee of unsecured creditors has been appointed in the case. Pachulski Stang Ziehl & Jones LLP has been tapped as counsel for the creditors' panel. FORD MOTOR: Denies Reaching Tentative Deal With Geely for Volvo --------------------------------------------------------------- Detroit Free Press reports that Ford Motor Co. denied a Shenzhen News Net report that it has reached a tentative deal with Geely Automobile Co. to sell its Volvo unit. As reported by the Troubled Company Reporter on May 7, 2009, Geely Holding Group Co. and at least three more bidders were reviewing the books of Ford Motor's Volvo. Ford is seeking $2 billion for Volvo, less than a third of what it paid for the unit a decade ago. Ford put Volvo up for sale in December 2008 after the unit's U.S. sales dropped 31%. Geely sent a team to Volvo's factory in Gothenburg, Sweden, in April to scrutinize the company's financial records. Shenzhen News reported that Ford and Geely reached a preliminary agreement, but were still working out many details such as the transfer of technology, Volvo's market position, and any layoffs following the sale. The Free Press quoted Ford of Europe spokesperson John Gardiner as saying, "We've been saying since the end of April ... that we're in discussions with a number of parties concerning the future of Volvo. No final decisions have been made." Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The Company provides financial services through Ford Motor Credit Company. The Company has operations in Japan in the Asia Pacific region. In Europe, the Company maintains a presence in Sweden, and the United Kingdom. The Company also distributes its brands in various Latin-American regions, including Argentina and Brazil. * * * As reported by the Troubled Company Reporter on April 15, 2009, Standard & Poor's Ratings Services said it raised its ratings on Ford Motor Co. and related entities, including the corporate credit rating, to 'CCC+' from 'SD-'. The ratings on Ford Motor Credit Co. are unchanged, at 'CCC+', and the ratings on FCE Bank PLC, Ford Credit's European bank, are also unchanged, at 'B-', maintaining the one-notch rating differential between FCE and its parent Ford Credit. S&P said that the outlook on all entities is negative. Moody's Investors Service in December 2008 lowered the Corporate Family Rating and Probability of Default Rating of Ford Motor Company to Caa3 from Caa1 and lowered the company's Speculative Grade Liquidity rating to SGL-4 from SGL-3. The outlook is negative. The downgrade reflects the increased risk that Ford will have to undertake some form of balance sheet restructuring to achieve the same UAW concessions that General Motors and Chrysler are likely to achieve as a result of the recently-approved government bailout loans. Such a balance sheet restructuring would likely entail a loss for bond holders and would be viewed by Moody's as a distressed exchange and consequently treated as a default for analytic purposes. FRAMINGHAM ACQUISITIONS: Files for Chapter 11, Dodges Foreclosure ----------------------------------------------------------------- Framingham Acquisitions LLC has filed for Chapter 11 bankruptcy protection and is seeking a buyer for five acres of properties slated for redevelopment. Framingham Acquisitions listed $1 million to $10 million in debt. According to Donna Goodison at Boston Herald, Framingham Acquisitions' $60 million mixed-use Arcade at Downtown Framingham project never got off the ground due to lack of financing. The project was to include 296 apartments, 60,000 square feet of retail space and a new 565-car garage, and entailed rehabbing several connected historic buildings on Concord Street, says Boston Herald. Citing principal Roger Lehrberg, the report states that Framingham Acquisitions failed to convince lenders that the project would command high enough rents to be financially feasible, and the rising construction costs as well as the town's insistence on the large garage made the project overly expensive. Boston Herald says that Framingham Acquisitions' bankruptcy filing prevented one of its lenders from foreclosing on a portion of the downtown property on June 19. Mr. Lehrberg said that Framingham Acquisitions was current on its mortgages, but the bank was concerned about $474,000 in back real estate taxes owed to the town, according to Boston Herald. "It's our hope that a buyer will come forward that will be able to continue with the project. In light of some of the economic stimulus packages that are in the pipeline, it's possible that there will be more government aid to assist with the building of the garage and some of the other infrastructure," the report quoted Mr. Lehrberg as saying. FRONTIER AIRLINES: Files Plan; to Become Subsidiary of Republic --------------------------------------------------------------- Frontier Airlines Holdings, Inc., has entered into an investment agreement with Republic Airways Holdings, Inc., by which Republic will serve as equity sponsor for Frontier's plan of reorganization and purchase 100% of the equity in the reorganized company for $108.75 million. The plan sponsorship agreement is subject to bankruptcy court approval and various conditions. If the plan of reorganization is approved and implemented as proposed, upon its emergence from Chapter 11, Frontier Airlines Holdings would become a wholly owned subsidiary of Republic, an airline holding company that owns Chautauqua Airlines, Republic Airlines and Shuttle America. Frontier Airlines and Lynx Aviation would maintain their current names and continue to operate as usual. "This agreement represents a major milestone in our ongoing efforts to position Frontier to emerge from bankruptcy as a competitive, sustainable airline," said Sean Menke, Frontier President and Chief Executive Officer. "Through our reorganization process, we have transformed Frontier Airlines and Lynx Aviation into two of the most efficient operating carriers in North America. Additionally, we diversified our revenue generation through the introduction of ancillary charges and our branded 'AirFairs' product. The culmination of all this extraordinary work is that, even in the worst economic environment in the last 50 years, the company has posted an operating profit for each of the past six months and a net profit for the past two quarters." Mr. Menke continued, "I would be absolutely remiss not to thank the thousands of Frontier and Lynx employees, and their families, for their sacrifice and dedication during these extraordinary times. They are truly the heart and soul of the company. We are pleased that this agreement allows our customers and communities to continue to receive the outstanding service for which Frontier is known, while preserving the jobs of most Frontier employees." "We commend Frontier and its employees for their hard work and accomplishments during this difficult restructuring period," said Bryan Bedford, chairman, president and CEO of Republic Airways. "We believe this agreement represents a new beginning for Frontier, positioning it to build on its recent successes and strengthen the Frontier brand for the benefit of employees and the customers and communities it serves." Frontier filed its proposed plan of reorganization and a related disclosure statement with the U.S. Bankruptcy Court for the Southern District of New York. Frontier also filed a motion to approve the investment agreement with Republic, subject to higher and better proposals under a court-supervised auction. Frontier will seek court approval of the investment agreement and proposed auction procedures at a hearing scheduled for July 13, 2009. Frontier currently expects to conclude the auction process and emerge from Chapter 11 by autumn 2009. In March 2009, Frontier received a firm commitment for $40 million in post-petition debtor-in-possession financing from Republic Airways Holdings to support Frontier's additional working capital needs and refinance its expiring DIP loan, increasing the available financing and preserving Frontier's financial stability. As a condition to the loan, Frontier agreed to allow Republic's damage claim in the amount of $150 million arising out of Frontier's rejection of its airline services agreement with Republic. The proposed plan of reorganization provides for general unsecured creditors to receive $28.75 million in cash. An additional $40 million of the sale proceeds would be applied as repayment of the outstanding DIP loan. If the plan is implemented as proposed, the company's current equity would be extinguished and holders of that equity would not receive any recovery. About Republic Airways Holdings Republic Airways Holdings, based in Indianapolis, Indiana, is an airline holding company that owns Chautauqua Airlines, Republic Airlines and Shuttle America. The airlines offer scheduled passenger service on approximately 1,200 flights daily to 99 cities in 34 states, Canada, Mexico and Jamaica through airline services agreements with six U.S. airlines. All of the airlines' flights are operated under their airline partner brand, such as AmericanConnection, Continental Express, Delta Connection, Midwest Connect, United Express and US Airways Express. The airlines currently employ approximately 4,400 aviation professionals and operate 235 regional jets. About Frontier Airlines Holdings Frontier Airlines Holdings, Inc. (Pink Sheets: FRNTQ) -- http://www.FrontierAirlines.com/-- is the parent company of Denver-based Frontier Airlines. Currently in its 15th year of operations, Frontier Airlines is the second-largest jet service carrier at Denver International Airport, employing approximately 5,000 aviation professionals. Frontier Airlines' mainline operation has 51 aircraft with one of the youngest Airbus fleets in North America. In conjunction with a fleet of 10 Bombardier Q400 aircraft operated by Lynx Aviation -- a subsidiary of Frontier Airlines Holdings, Inc. -- Frontier offers routes to more than 50 destinations in the U.S., Mexico and Costa Rica. Frontier Airlines and its debtor-affiliates filed for Chapter 11 protection on April 10, 2008, (Bankr. S.D.N.Y. Case No. 08-11297 thru 08-11299.) Benjamin S. Kaminetzky, Esq., and Hugh R. McCullough, Esq., at Davis Polk & Wardwell, represent the Debtors in their restructuring efforts. Togul, Segal & Segal LLP is the Debtors' Conflicts Counsel, Faegre & Benson LLP is the Debtors' Special Counsel, and Kekst and Company is the Debtors' Communications Advisors. The Debtors' exclusive period to file a plan of reorganization will expire on October 9, 2009. Their exclusive period to solicit and obtain acceptances of that plan will expire December 9, 2009. Bankruptcy Creditors' Service, Inc., publishes Frontier Airlines Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Frontier Airlines Inc. and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GBF ENTERPRISES: Case Summary & 12 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: GBF Enterprises, LLC 58 Great Hill Road North Branford, CT 06471 Bankruptcy Case No.: 09-31666 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of Connecticut (New Haven) Judge: Lorraine Murphy Weil Debtor's Counsel: Neil Crane, Esq. Law Offices of Neil Crane, LLC 2700 Whitney Avenue Hamden, CT 06518 Tel: (203) 230-2233 Fax: (203) 230-8484 Email: neilcranelaw@snet.net Estimated Assets: $0 to $50,000 Estimated Debts: $100,001 to $500,000 A full-text copy of the Debtor's petition, including a list of its 12 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ctb09-31666.pdf The petition was signed by Megam Magiulo, member of the Company. GEORGE LIGON DUNN: Case Summary & 13 Largest Unsecured Creditors ---------------------------------------------------------------- Joint Debtors: George Ligon Dunn Cynthia Elaine Dunn 11402 Chinquapin Way Fredericksburg, VA 22407-8421 Bankruptcy Case No.: 09-33946 Chapter 11 Petition Date: June 20, 2009 Court: United States Bankruptcy Court Eastern District of Virginia (Richmond) Judge: Kevin R. Huennekens Debtors' Counsel: Robert Easterling, Esq. 2217 Princess Anne St., Ste. 100-2 Frederickburg, VA 22401 Tel: (540) 373-5030 Email: eastlaw@easterlinglaw.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 13 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/vaeb09-33946.pdf The petition was signed by the Joint Debtors. HANGER ORTHOPEDIC: S&P Lifts Ratings to 'B+'; Gives Stable Outlook ------------------------------------------------------------------ Standard & Poor's Ratings Services said that it has raised its rating on Bethesda, Maryland-based Hanger Orthopedic Group Inc. to 'B+' from 'B'. The outlook is stable. S&P also raised the issue- level rating on the company's senior secured debt to 'BB-' from 'B+' with a recovery rating of '2' indicating an expected substantial (70% to 90%) recovery in the event of payment default. S&P also raised the senior unsecured debt to 'B-' from 'CCC+' with a recovery rating of 6, indicating an expectation of negligible (0%-10%) recovery in the event of payment default. "The rating action reflects Hanger's solid operating performance in the past year demonstrated by overall growth revenue growth of around 10%, driven by same-store growth of approximately 7%," said Standard & Poor's credit analyst Rivka Gertzulin. Also, EBITDA growth has led to an improvement in the company's financial risk profile. Over the past year liquidity has improved substantially as the company generated $38 million of free cash flow. In addition, debt leverage improved to 4.9x from 5.3x at Dec. 31, 2007. The ratings on orthotics- and prosthetics-focused patient care provider Hanger reflect S&P's uncertainties about operating in a historically difficult reimbursement environment, cost inflation pressures, and significant debt burden. Historically, Hanger has faced pricing pressure from both government and large, private third-party payors. Many of the company's commercial payors and the U.S. Veterans Administration reimburse at levels tied to Medicare reimbursement, which compounds any decreases or increases in Medicare reimbursement. Medicare reimbursement rates for O&P services were frozen in 2004-2006, leading to margin compression given that Hanger regularly experiences inflation in its cost of services; labor represents its largest expense. However, reimbursement rates increased 5% in the current year, following two years of modest increases. Rates should continue to increase with Consumer Price Index adjustments in future years (although rates will likely be frozen in the next fiscal year as the CPI index is now slightly negative). Therefore, gross margins improved slightly as Hanger has been able to leverage its labor and material costs. Hanger is attempting to use its industry-leading position, with more than 650 centers throughout the U.S., against fragmented local competitors by offering bundled payment management services at attractive prices to large-volume health care purchasers. This managed-care program, Linkia, has developed more slowly than expected, but Hanger does have nine national contracts under the program and over 1,000 provider locations. HARTWICK COLLEGE: Moody's Keeps 'Ba1' Rating on Outstanding Bonds ----------------------------------------------------------------- Moody's Investors Service has affirmed the Ba1 debt rating on Hartwick College's outstanding bonds issued through the County of Otsego Industrial Development Authority. The rating applies to $21 million of fixed rate Series 2002A bonds expected to be outstanding as of June 30, 2009. The negative outlook reflects the College's ongoing enrollment challenges which have resulted in continuing operating deficits (on a Moody's adjusted basis) in conjunction with deterioration of the College's balance sheet due to investment losses. Due to actions taken by the College's new leadership (assessment and planned reduction of staffing levels, budget cuts in FY 2009 and FY 2010, and reduced endowment draws), Moody's expects to review the rating within a year. Legal Security: General obligation; debt service reserve fund funded at approximately $2.4 million in June 2009. Interest Rate Derivatives: None. Challenges * Highly competitive market for students for this small undergraduate liberal arts college located in Oneonta, New York as demonstrated by the College's thin freshmen selectivity of 78% and low yield of 21% on accepted students. The College draws 60% of its students from New York State (1,451 full-time equivalents, FTE in fall 2008). The fall 2008 enrollment represents a 3% decline from the prior year's enrollment levels as the result of reduced retention of enrolled students. The College faces ongoing enrollment challenges for fall 2009, with management's downsized budget targeting an incoming class of 400 freshmen compared to 446 freshmen in fall 2008. * Thin balance sheet cushion and low levels of unrestricted financial resources as the result of draws upon the endowment to withstand historical operating loses. Financial resources have declined further due to investment losses in FY 2009, with the College reporting $47.5 million of cash and investments as of 5/31/09. The investment losses (negative 21.2% for FY 2009 through May 31, 2009, with an allocation of 59.7% to public equity, 14.4% to hedge funds, 10.9% to fixed income, 10.8% private equity and real estate, and 4.2% to cash -- managed by the Common Fund with $1.3 million of the cash held separately) can be expected to disproportionately pressure unrestricted financial resources (only 46% of total financial resources were expendable in FY 2008). The investment pool has some manager concentration with 48% allocated to one multi-strategy equity fund. Management projects that approximately $9 million of the May 31, 2009 cash and investments of $47.5 million is quasi- endowment. To preserve financial resources, management's FY 2010 budget includes a significantly reduced draw from the endowment totaling $1 million (well below Moody's 5% endowment spend). * Improved, but still strained operating performance with historical operating deficits extending over a decade (includes heightened endowment spending to cover debt service). Average operating performance as calculated by Moody's was negative 5.7% for fiscal years 2006 - 2008 compared to a negative 14% average operating margin five years ago. Operating performance in FY 2008 benefited from a 5.3% increase in net tuition revenue and fees (a key source of revenue at 82% of operating revenues in FY 2008). Due to below budget enrollment in fall 2008, operating performance for FY 2009 is expected to show strain with approximately flat net tuition and fees; mitigating this, management has reduced expenses (reductions of $1.6 million were made midyear from the FY 2009 budget). In combination with the reduced endowment draw budgeted for FY 2010, management has instituted difficult expense cuts (totaling $3.1 million) including the reduction of positions (9 full-time and five part- time employees) in this year as well as contingency expense reduction plans based on certain enrollment targets. * Current operations do not fully cover debt service (average debt service coverage was 0.8 times in FY 2008 by Moody's calculation), and operational recovery plan demands a sustained improvement in unrestricted giving, as well as further improvement in student market positioning to garner growing net tuition revenue, which may prove challenging given the environment. Strengths * Net tuition per student of $16,210 in FY 2008 is on par with peer institutions (Moody's FY 2008 median for Baa-rated colleges and universities with enrollment under 3,000 FTE was $16,305). * The College has continued to maintain heightened philanthropic support, with three year average gift revenue of $8.8 million for fiscal years 2006 - 2008 (compares favorably to Moody's peer median of $5.8 million in FY 2008); total gift revenue of $15 in FY 2008 (includes restricted gifts) was particularly strong and included gifts designated for Golisano Hall on campus (a $12.3 million project completed in fall 2008). * Modest amount of outstanding debt ($22.5 million outstanding as of FY 2008) and conservative debt structure (the Series 2002A bonds are fixed rate with debt service of approximately $2 million through FY 2013 increasing to $2.4 million in FY 2014, final maturity is 2023). The College has no additional plans to issue debt; however, approximately $2.5 million is projected to be outstanding on the College's line of credit at the close of FY 2009 (this borrowing reflects bridge financing of gifts for the Golisano Hall project). * New management team focused on improvement of operating performance. A new president (assumed leadership in July 2008), vice president for finance (October 2007), and vice president for student affairs (December 2008) are focused on strategic planning, niche marketing, and identifying new revenue streams for the College. In fall 2008, Hartwick College launched a three year bachelor's degree program and an expansion of the nursing program is under consideration. * Improved operating cash flow in recent years. Positive operating cash flow of 4.2% in FY 2008 compares to a 5% cash flow deficit as recently as FY 2003, although recent performance still does not fully cover debt service under a 5% endowment spending draw. The improving cash flow margin is due to revenue growth in core net tuition revenue, as well as an increase in unrestricted giving and continued expense management. Outlook The negative outlook at the Ba1 rating level is based on Moody's concern regarding the College's small enrollment base and history of enrollment declines and fundamentally imbalanced operating performance. Absent an ability to improve student demand, Moody's believe the College is likely to face ongoing operating challenges. Moody's believe that the College's management team, president, and Board are prudently focused on achieving sustainable operating performance. What Could Change the Rating - UP Further strengthening of student demand and stabilized enrollment of new freshmen, accompanied by a consistent trend in positive operating cash flow providing solid coverage of debt service and re-growth of unrestricted financial resources What Could Change the Rating - DOWN Deterioration in liquidity, worsening of operating deficits, or weakening of student market position Key Indicators (Fall 2008 Enrollment, FY 2008 Financial Information): * Numbers included in parentheses represent the projection of a decline in expendable financial resources equal to 30% of total financial resources to reflect investment losses combined with endowment spending * Total Full Time Equivalent Enrollment (FTE): 1,451 * Freshmen Selectivity: 78% * Freshmen Matriculation: 21% * Net Tuition per Student: $16,210 * Expendable Financial Resources: $22 million ($1.3 million) * Expendable Financial Resources to Direct Debt: 1 times (0.06 times) * Expendable Financial Resources to Operations: 0.5 times (0.03 times) * Three-Year Average Operating Margin: negative 5.7% * Operating Cash Flow Margin: 4% * Actual Debt Service Coverage: 0.8 times * Reliance on Student Charges: 82% Rated Debt: * Series 2002: Ba1 The last rating action was on March 27, 2006, when Hartwick College's Ba1 rating was affirmed and the outlook revised to stable from negative. HATTIE SCHERBACK: Seeks to Employ Michael Mitchell as Counsel ------------------------------------------------------------- Hattie Crane Scherback seeks permission from the U.S. Bankruptcy Court for the Eastern District of Texas, Texarkana Division, to employ Michael S. Mitchell, P.C., as counsel. The Debtor desires to retain Michael S. Mitchell, P.C. as counsel to perform extensive legal services. The firm will (i) take all necessary action to protect and preserve the Debtor's estate, (ii) prepare on behalf of the Debtor all pleadings in connection with the administration of the estate, and (iii) formulate, negotiate, and propose a plan of reorganization, if justified. The firm has received $3,961 retainer from the Debtor. The firm may be contacted at: Michael S. Mitchell, Esq. Michael S. Mitchell, P.C. Plains Capital Bank Building 18111 N. Preston Road, Suite 810 Dallas, TX 75252 Telephone: 972-578-1400 Facsimile: 972-578-1325 E-mail: mike@msm-pc.com About Hattie Scherback Hattie Crane Scherback owns certain real property located in both Bowie County Texas and in Red River County Texas, which has a $9,500,000 mortgage lien held against it. Ms. Scherback filed for Chapter 11 following a cash flow crisis created, in large part, by the Debtor's investment in the seed and equipment needed to begin the production and farming of canola. The Debtor is actively marketing and seeks to sell the Property in order to fully pay her debts. Hattie Crane Scherback, f/k/a Hattie Maye Reed and Hattie Maye Crane, filed for Chapter 11 on June 1, 2009 (Bankr. E.D. Tex. Case No. 09-50130). At the time of the filing, the Debtor estimated assets and debts of $10,000,001 to $50,000,000. HAWAII SUPERFERRY: Seeks Pepper Hamilton as Counsel --------------------------------------------------- Hawaii Superferry Inc. and HSF Holding Inc. ask the U.S. Bankruptcy Court for the District of Delaware for permission to employ Pepper Hamilton LLP as their counsel. Among other things, the firm will: a) advise the Debtors with respect to their rights, powers and duties as debtors and debtors-in-possession in the continued management and operation of their business and properties; b) attend meetings and negotiating with representatives of creditors and other parties-in-interest; c) advise and consult the Debtors regarding the conduct of these cases, including all of the legal and administrative requirements of operating in chapter 11; d) advise the Debtors on matters relating to the evaluation of the assumption, rejection or assignment of unexpired leases and executory contracts; and e) take all necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on their behalf, the defense of any actions commenced against those estates, negotiations concerning all litigation in which the Debtors may be involved and objections to claims filed against the estates. The firm's compensation rates are: Designation Hourly Rate ----------- ----------- Partners $465-$725 Associates $240-$390 Legal Assistants $220 To the best of the Debtors' knowledge, the firm is a "disinterested person" as define in Section 101(14) of the Bankruptcy Code. HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. The Company is planning to use the latest generation of large, high-speed roll-on/roll-off catamaran ferries. The ferries will be used to transport travellers from island to island as well as transport agricultural and bulk goods. The companies filed for protection on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). When the Debtors sought protection from their creditors, they listed both assets and debts between $100 million and $500 million. HAWAII SUPERFERRY: State of Hawaii Seeks Transfer of Venue ---------------------------------------------------------- The state of Hawaii asks the U.S. Bankruptcy Court for the District of Delaware to transfer the venue of the cases of HSF Holding, Inc., Hawaii Superferry, Inc., and their affiliates, to the United States Bankruptcy Court for the District of Hawaii. The State contends that the transfer of venue to Hawaii: -- would be more convenient for interested parties; and -- is necessary to protect the interests of the State. The State contends that the Debtors are nothing more than the product of a public/private partnership to develop and operate a transit system solely within Hawaii. Because the only basis for jurisdiction in Delaware is that HSF is incorporated in Delaware, the State argues that the cases would more appropriately be heard by the bankruptcy court in Hawaii. HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. HSF Holding and Hawaii Superferry filed for bankruptcy protection on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). David B. Stratton, Esq., and Evelyn J. Meltzer, Esq., at Pepper Hamilton LLP, serve as the Debtors' counsel. The Debtors disclosed $100 million to $500 million in both estimated assets and debts. HAWAII SUPERFERRY: Taps Blank Rome & Goodsill as Special Counsels ----------------------------------------------------------------- Hawaii Superferry Inc. and HSF Holding Inc. ask the U.S. Bankruptcy Court for the District of Delaware for authority to employ Blank Rome LLP and Goodsill Anderson Quinn & Stifel LLP as their special counsels. Blank Rome will provide services in connection with the Debtors' maritime and financing matters while Goodsill Anderson is expected to provide services regarding with general corporate and environmental matters for the Debtors' locally in the State of Hawaii. The firms did not disclosure their hourly compensation rates. To the best of the Debtors knowledge, the firms assure the Court that they are "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. HSF Holding Inc. operates as the parent company of Hawaii Superferry, Inc., a Hawaiian inter-island ferry service expected to commence operations in early 2007. The Company is planning to use the latest generation of large, high-speed roll-on/roll-off catamaran ferries. The ferries will be used to transport travellers from island to island as well as transport agricultural and bulk goods. The companies filed for protection on May 30, 2009 (Bankr. D. Del. Case Nos. 09-11901 and 09-11902). When the Debtors sought protection from their creditors, they listed both assets and debts between $100 million and $500 million. HAWAIIAN TELCOM: Kirkland Bills $2.5MM for Dec.-to-March Work ------------------------------------------------------------- Pursuant to Sections 330 and 331 of the Bankruptcy Code, several professionals employed with respect to Hawaiian Telcom Communications Inc.'s Chapter 11 cases filed with the Court their first interim fee applications for the fee period from December 2008 through March 2009: Fee Firm Period Fees Expenses ---- ---------- ---------- -------- Kirkland & Ellis LLP 12/01/08 - $2,516,509 $71,312 03/31/09 Deloitte & Touche LLP 01/08/09 - 633,929 1,292 03/31/09 Ernst & Young LLP 12/01/08 - 52,834 0 03/31/09 Lazard Freres & Co. LLC 12/01/08 - 800,000 9,427 03/31/09 Morrison & Foerster LLP 12/01/08 - 544,317 41,890 03/31/09 FTI Consulting, Inc. 12/01/08 - 722,581 19,653 03/31/09 The requested fees total $5,270,170 and the requested expense reimbursements amount to $143,574. Kirkland & Ellis serves as the Debtors' counsel. Deloitte is the Debtors' independent auditor. Ernst & Young acts as tax auditors to the Debtors. Lazard Freres is financial advisor to the Debtors. Morrison Foerster is the Official Committee of Unsecured Creditors' lead counsel. FTI Consulting is financial advisor to the Committee. U.S Trustee Comments on Applications Upon review, Tiffany Caroll, acting United States Trustee for Region 15, objects to certain of the first interim fee applications. The U.S. Trustee opposes the $3,900 portion of fees sought by Deloitte for preparing its application. The U.S. Trustee asserts that time spent to satisfy the interim compensation procedures as preparing monthly invoices should not be billable to the Debtors' estate. Subsequently, the U.S. Trustee informed the Court that she has communicated with Deloitte resulting to Deloitte's voluntarily agreeing to reduce (i) its sought expenses by $1,292; and (ii) its sought fees by $2,000. With the reduction, the U.S. Trustee does not object to Deloitte's Application. The U.S. Trustee also observes that of the $52,834 in fees sought by Ernst & Young, more than $30,000 involves the firm's retention work, including updating matrixes, preparing statements of work, obtaining information on its Global Financial Information System, preparing engagement letters, and doing conflicts checks. The U.S. Trustee asserts that the $30,000 amount is excessive and that much of the work, including engagement letters, should not be billed to the Debtors' estates. She continues that no more than $5,000 should be allowed as a reasonable fee for conducting the work for Ernst & Young retention. The U.S. Trustee also objects to the allowance of $17,483 billed by Mr. Queza of Ernst & Young since there are no accompanying time entries for his work. The U.S. Trustee reserves its right to further review Lazard Freres' fees until the firm files its application for final fees. Nevertheless, the U.S. Trustee notes that Lazard Freres seeks $865 in reimbursement of car services and taxis, $700 of which charges were incurred in September and October 2008 well before the Debtors' bankruptcy filing. The U.S. Trustee asserts that it is not clear why those expenses are actual and necessary. Moreover, the U.S. Trustee tells the Court that she has communicated with Kirkland & Ellis regarding her concerns to its interim application. Accordingly, Kirkland & Ellis has voluntarily agreed to reduce its fee request by $16,305 plus related general excise tax of 4.7% for a total reduction of $17,701. In light of the reduction, the U.S. Trustee does not oppose Kirkland & Ellis' application. State of Hawaii Asserts Excise Tax Right In a statement filed with the Court, the State of Hawaii asks Judge King to direct all professionals either (i) approved by the Court pursuant to the Interim Compensation Procedures, or (ii) paid by the Debtors' estates through a cash collateral order as in the case of Lehman Commercial Paper, Inc.'s professionals including Weil, Gotshal & Manges LLP and Houlihan Lokey Howard and Zukin to add 4.712% to their sought fees and costs and pay the amount equal to 4.712% to the State of Hawaii. Jerrold K. Guben, Esq., at special deputy attorney general for the State, in Honolulu, Hawaii, explains that Chapter 237 Hawaii Revised Statutes imposes a general excise tax on gross income received by a taxpayer with respect to business activities in the State. In this regard, the State asserts its right to impose an excise tax on the professional fees and costs of the Debtors' out-of-state professionals and in-state professionals, provided that the professional has a nexus with the State of Hawaii and services are used or consumed in the State. About Hawaiian Telcom Based in Honolulu, Hawaii, Hawaiian Telecom Communications, Inc. -- http://www.hawaiiantel.com/-- operates a telecommunications company, which offers an array of telecommunications products and services including local and long distance service, high-speed Internet, wireless services, and print directory and Internet directory services. The Company and seven of its affiliates filed for Chapter 11 protection on December 1, 2008 (Bankr. D. Del. Lead Case No. 08-13086). As reported by the TCR on December 30, 2008, Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware approved the transfer of the Chapter 11 cases to the U.S. Bankruptcy Court for the District of Hawaii before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005). Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in their restructuring efforts. The Debtors proposed Lazard Freres & Co. LLC as investment banker; Zolfo Cooper Management LLC as business advisor; Deloitte & Touche LLP as independent auditors; and Kurztman Carson Consultants LLC as notice and claims agent. An official committee of unsecured creditors has been appointed and is represented by Christopher J. Muzzi, Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu, Hawaii. When the Debtors filed for protection from their creditors, they listed total assets of $1,352,000,000 and total debts of $1,269,000,000 as of September 30, 2008. Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Hawaiian Telcom Communications, Inc., and seven of its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) HAYES LEMMERZ: Incurs $58.5-Mil. Net Loss for Qrtr Ended April 30 ----------------------------------------------------------------- Hayes Lemmerz International, Inc.'s balance sheet at April 30, 2009, showed total assets of $1.0 billion, total liabilities of $1.3 billion, resulting in a stockholders' deficit of about $280 million. For three months ended April 30, 2009, the Company incurred net loss of $58.5 million compared with net loss of $12.8 million for the same period in the previous year. As of April 30, 2009, the Company was in violation the leverage ratio and interest coverage ratio covenants of its prepetition credit facilities. The failure to meet these covenants and its subsequent Chapter 11 filings were events of default under the prepetition credit facilities and also resulted in a default under the senior notes. As a result, those long-term debt obligations became automatically and immediately due and payable, subject to an automatic stay of any action to collect, assert, or recover a claim against the Debtors and the application of applicable bankruptcy law. Cash used for operations was $33.1 million in the first three months of fiscal 2009 compared to $31.8 million in the first three months of fiscal 2008. The $1.3 million increased use of cash was due to lower profits offset by a decrease in working capital, both attributable to lower sales volumes during the first quarter of fiscal 2009 as compared to the first quarter of fiscal 2008. A full-text copy of the 10-Q is available for free at: http://ResearchArchives.com/t/s?3e0f About Hayes Lemmerz Originally founded in 1908, Hayes Lemmerz International, Inc. (NasdaqGM: HAYZ) is a worldwide producer of aluminum and steel wheels for passenger cars and light trucks and of steel wheels for commercial trucks and trailers. The Company is also a supplier of automotive powertrain components. The Company has global operations with 23 facilities, including business, sales offices and manufacturing facilities, located in 12 countries around the world. The Company sells products to every major North American, Asian and European manufacturer of passenger cars and light trucks and to commercial highway vehicle customers throughout the world. The Company and certain affiliates filed for bankruptcy on May 11, 2009 (Bankr. D. Del. Case No. 09-11655) after reaching agreements with lenders holding a majority of the Company's secured debt. The Company's principal bankruptcy attorneys are Skadden, Arps, Slate, Meagher & Flom, LLP. Lazard Freres & Co., LLC serves as the Company's financial advisors. AlixPartners, LLP serves as the Company's restructuring advisors. The Garden City Group, Inc., serves as the Debtors' claims and notice agent. As of January 31, 2009, the Debtors had total assets of $1,336,600,000 and total debts of $1,405,200,000. This is the Company's second trip to the bankruptcy court, dubbed a Chapter 22, which was precipitated by an unprecedented slowdown in industry demand and a tightening of credit markets. The Company plans to reduce its debt and restructure its balance sheet. Hayes Lemmerz and its direct and indirect domestic subsidiaries and one subsidiary in Mexico first filed for bankruptcy in December 2001 before the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 filings were precipitated by declining market conditions and the Company's excessive debt burdens, according to Mr. Clawson, who also served as chairman and chief executive officer at that time. The Court confirmed the Company's reorganization plan in May 2003, allowing the Company to exit bankruptcy in June 2003. In accordance with the 2003 Plan, approximately $2.1 billion in pre-petition debt and other liabilities were discharged. The Plan provided for holders of prepetition secured claims to receive $478.5 million in cash and 53.1% of the reorganized company common stock. Holders of senior note claims were to receive $13 million in cash and 44.9% of the New Common Stock, and holders of general unsecured claims were to receive 2% of the New Common Stock. Hayes Lemmerz' prior common stock and securities were cancelled as of June 3, 2003. HENRY DUNAY: Files Bare-Bones Chapter 11 Petition ------------------------------------------------- Henry Dunay Designs Inc. filed for bankruptcy before the U.S. Bankruptcy Court for the Southern District of New York on June 22, 2009. Reuters' Emily Chasan says the company did not specify why it filed for bankruptcy in its initial petition, but notes that several jewelers have been forced into bankruptcy over the last year as consumers cut back on discretionary purchases. Ms. Chasan says Henry Dunay, the Company's president, declined to comment on the reason for the bankruptcy filing. Henry Dunay has outfitted dozens of celebrities and sells designs through upscale department stores like Bergdorf Goodman and Neiman Marcus. Mr. Dunay launched the company in 1965 and is listed as president of the company on the bankruptcy filing, according to the report. The case is Henry Dunay Designs Inc. (Bankr. S.D.N.Y. Case No. 09-13969). The Company listed assets and liabilities in the range of $1 million to $10 million. HERBST GAMING: Files Joint Plan of Reorganization in Nevada ----------------------------------------------------------- Herbst Gaming, Inc., and certain of its subsidiaries filed with the U.S. Bankruptcy Court for the District of Nevada a joint Plan of Reorganization. The Company related that the Bankruptcy law does not permit solicitation of acceptances of a Plan of reorganization until the bankruptcy court approves the disclosure statement relating to the Plan. A full-text copy of the Debtors' Joint Plan Of Reorganization is available for free at http://ResearchArchives.com/t/s?3e0d Headquartered in Reno, Nevada, Herbst Gaming Inc. -- http://www.herbstgaming.com/-- is an established casino and slot route operator that operates casinos located in Nevada, Missouri and Iowa. The Debtors own and operate approximately 6,800 slot machines in its slot route business and is a slot machine operator in Nevada. The Company and 17 of its affiliates filed for Chapter 11 protection on March 22, 2009 (Bankr. D. Nev. Lead Case No. 09-50752). Thomas H. Fell, Esq., Gordon Silver, represents the Debtors in their restructuring efforts. Herbst Gaming had $919.1 million in total assets; and $33.5 million in total liabilities not subject to compromise and $1.24 billion in liabilities subject to compromise, resulting in $361.0 million in stockholders' deficiency as of March 31, 2009. HOVNANIAN ENTERPRISES: Unit Commences Cash Tender Offers -------------------------------------------------------- Hovnanian Enterprises, Inc.'s wholly owned subsidiary, K. Hovnanian Enterprises, Inc., has commenced cash tender offers for: (i) any and all of its outstanding $28,870,000 6% Senior Subordinated Notes due 2010 at a fixed purchase price; (ii) the maximum aggregate principal amount of its 8% Senior Notes due 2012 ($88,174,000 outstanding), 8-7/8% Senior Subordinated Notes due 2012 ($70,935,000 outstanding) and 7-3/4% Senior Subordinated Notes due 2013 ($96,225,000 outstanding) that it can purchase for $40.0 million at a purchase price determined in accordance with the procedures of a modified "Dutch Auction"; and (iii) the maximum aggregate principal amount of its 6-1/2% Senior Notes due 2014 ($144,149,000 outstanding), 6-3/8% Senior Notes due 2014 ($115,313,000 outstanding), 6-1/4% Senior Notes due 2015 ($135,403,000 outstanding), 6-1/4% Senior Notes due 2016 ($182,405,000 outstanding), 7-1/2% Senior Notes due 2016 ($196,652,000 outstanding) and 8-5/8% Senior Notes due 2017 ($207,178,000 outstanding) that it can purchase for $20.0 million at a purchase price determined in accordance with the procedures of a modified "Dutch Auction". Each Tender Offer will expire at 8:00 a.m., New York City time, on July 20, 2009, unless extended or earlier terminated. Holders of Notes must validly tender and not withdraw their Notes on or prior to 5:00 p.m., New York City time, on July 2, 2009, unless extended (with respect to each Tender Offer, the "Early Participation Date"), to receive the Total Consideration for their Notes. The Total Consideration includes an early participation payment of $30.00 for each $1,000 principal amount of Notes validly tendered on or before the Early Participation Date and accepted in the applicable Tender Offer. Holders validly tendering their Notes after the Early Participation Date and on or prior to the Expiration Date will only be eligible to receive the Tender Offer Consideration for such Notes, which is equal to the Total Consideration for such Notes less the Early Participation Payment. Notes tendered may be withdrawn at any time prior to 5:00 p.m., New York City time, on July 2, 2009, unless extended but not thereafter. 95.50 Cents-On-The-Dollar for 2010 Notes Holders who validly tender and do not validly withdraw their 2010 Notes prior to the Early Participation Date, will be entitled to receive the Total Consideration of $985, payable in cash, for each $1,000 principal amount of 2010 Notes accepted for purchase, which amount includes the Early Participation Payment. Holders who validly tender their 2010 Notes after the Early Participation Date but prior to the Expiration Date will receive the Tender Offer Consideration of $955 per $1,000 principal amount of 2010 Notes accepted for purchase but will not receive the Early Participation Payment. Dutch Tender Offers The Total Consideration payable to holders who validly tender and do not validly withdraw their Dutch Notes on or prior to the Early Participation Date will be determined based on a formula consisting of a "base price" per $1,000 principal amount of Dutch Notes, plus a "clearing premium" to be determined pursuant to the modified "Dutch Auction." Holders validly tendering their Dutch Notes after the Early Participation Date and on or prior to the Expiration Date will only be eligible to receive the Tender Offer Consideration for their Dutch Notes, which is equal to the Total Consideration for such Dutch Notes less the Early Participation Payment. The clearing premium will be determined by consideration of the "bid price" specified by each holder that tenders Dutch Notes into the applicable Dutch Tender Offer, which represents the minimum Total Consideration such holder is willing to receive for those Dutch Notes. The bid price each holder specifies with respect to a particular series of Dutch Notes must be within these ranges: Base Price/ Minimum Maximum Series of Notes Bid Price Bid Price ---------------------------------------- ---------- --------- 8% Senior Notes due 2012 $650 $750 8-7/8% Senior Subordinated Notes due 2012 $500 $600 7-3/4% Senior Subordinated Notes due 2013 $400 $500 2014-2017 Notes $480 $580 With respect to each Dutch Tender Offer, the "clearing premium" will be determined by consideration of the "bid premiums" -- the amount by which each bid price exceeds the base price -- of all tendered Dutch Notes, in order of lowest to highest bid premiums. The clearing premium will be the lowest single premium such that for all tenders of Dutch Notes whose bid price results in a bid premium equal to or less than this single lowest premium, K. Hovnanian will be able to purchase the greatest principal amount of Dutch Notes for $40.0 million in the case of the 2012-2013 Tender Offer and $20.0 million in the case of the 2014-2017 Tender Offer. With respect to each Dutch Tender Offer, if the aggregate amount of Dutch Notes validly tendered (and not withdrawn) at or above the clearing premium would cause K. Hovnanian to spend more than $40.0 million in the case of the 2012-2013 Tender Offer and $20.0 million in the case of the 2014-2017 Tender Offer, then, subject to the terms and conditions of the Dutch Tender Offers, K. Hovnanian will accept for purchase, first, all Dutch Notes validly tendered (and not withdrawn) at a bid premium less than the applicable clearing premium, and thereafter, Dutch Notes validly tendered (and not withdrawn) with a bid premium equal to the applicable clearing premium on a prorated basis. K. Hovnanian to Pay Interest K. Hovnanian will pay accrued and unpaid interest on all Notes tendered and accepted for payment in the Tender Offers from the last interest payment date to, but not including, the date on which the Notes are purchased. The Tender Offers are conditioned upon the satisfaction of certain customary conditions. The Tender Offers are not conditioned on financing, any minimum amount of Notes being tendered or the consummation of any of the other Tender Offers. The terms and conditions of the Tender Offers are described in the Offers to Purchase, dated June 19, 2009, and in the related Letter of Transmittal. K. Hovnanian has retained Citi, Banc of America Securities LLC and Wachovia Securities to serve as dealer managers for the Tender Offers, and Bondholder Communications Group to serve as the information and tender agent. Copies of the offer to purchase and related documents may be obtained from BCG at (888) 385-2663 (toll free). Questions regarding the Tender Offers may be directed to: Citi at (800) 558-3745 (toll free) or (212) 723-6106 (collect), Banc of America Securities LLC (888) 292-0070 (toll free) or (980) 388-9217 (collect) and Wachovia Securities at (866) 309-6316 (toll free) or (704) 715-8341 (collect). About Hovnanian Enterprises Hovnanian Enterprises, Inc. (NYSE: HOV) founded in 1959 by Kevork S. Hovnanian, Chairman, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian(R) Homes(R), Matzel & Mumford, Brighton Homes, Parkwood Builders, Town & Country Homes, Oster Homes, First Home Builders of Florida and CraftBuilt Homes. As the developer of K. Hovnanian's(R) Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes. INDALEX HOLDINGS: Committee Objects to Bonus Plan for Management ---------------------------------------------------------------- Bloomberg News reports that the official committee of unsecured creditors in Indalex Holdings Finance Corp. and its affiliates' Chapter 11 cases has filed before the U.S. Bankruptcy Court for the District of Delaware an objection to a proposed bonus program for management. The Committee is complaining that Indalex filed the motion for approval of the bonuses only three days before bids were due for the sale of the assets. The Committee, according to Bloomberg, says that Indalex knew by then that the sale price would exceed the threshold required for paying executive bonuses. The committee contends that the program is a retention bonus prohibited by Congress for senior managers of bankrupt companies. About Indalex Holdings Indalex Holding Corp., a wholly-owned subsidiary of Indalex Holdings Finance Inc., through its operating subsidiaries Indalex Inc. and Indalex Ltd., with headquarters in Lincolnshire, Illinois, is the second largest producer of soft alloy extrusion products in North America. The company's aluminum extrusion products are widely used throughout industrial, commercial and residential applications and are customized to meet specific end- user requirements. Indalex operates 10 extrusion facilities, 29 extrusion presses with circle sizes up to 20 inches, a variety of fabrication and close tolerance capabilities, two anodizing operations, two billet casting facilities, and six electrostatic paint lines, including powder coat capability. Indalex is indirectly controlled by private-equity investor Sun Capital Partners Inc. Sun Capital purchased Indalex in 2005 from Honeywell International Inc. for $425 million. Indalex is the 12th investment by Boca Raton, Florida-based Sun Capital to file in Chapter 11 since January 2006. Indalex Holdings and four affiliates filed for Chapter 11 on March 20 (Bankr. D. Del., Lead Case No. 09-10982). Donald J. Bowman, Jr., Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, has been tapped as counsel. Epiq Bankruptcy Solutions LLC is the claims and noticing agent. In its bankruptcy petition, Indalex listed assets of $356 million against debt totaling $456 million. INNOVATIVE COS: Can Use Citibank Cash Collateral Until June 30 -------------------------------------------------------------- On June 17, 2009, the U.S. Bankruptcy Court for the Eastern District of New York granted The Innovative Companies LLC, et al., permission, on an interim basis, to continue using cash collateral of Citibank, N.A., until June 30, 2009, in accordance with a budget. As of the petition date, Citibank asserts a claim against the Debtors of approximately $22,110,000 secured by the Debtors' assets, including cash collateral that is estimated by the Debtors to be worth approximately $14,000,000. As adequate protection against any diminution in value of the Collateral, including cash collateral, Citibank is granted a security interest and replacement lien in all of the assets and property acquired by the Debtors after the petition date and the proceeds thereof, including, without limitation, the bank accounts maintained by the Debtors at any non-Citibank financial institution, subject to a Carve-Out for fees payable to the U.S. Trustee and any fees payable to the Clerk of the Bankruptcy Court, and reasonable fees and expenses of any Chapter 7 trustee appointed in a subsequent conversion of all of the cases, up to a maximum of $7,500. As additional adequate protection, Citibank is granted an allowed administrative claim under sections 503(b)(1), 507(a), and 507(b) of the Bankruptcy Code for any diminution in the value of the Citibank Collateral. About The Innovative Companies Headquartered in Hauppauge, New York, The Innovative Companies LLC and its affiliates filed for Chapter 11 protection on April 17, 2009 (Bankr. E.D.N.Y. Lead Case No. 09-72669). Leslie A. Berkoff, Esq., at Moritt Hock Hamroff Horowitz LLP, represents the Debtors in their restructuring efforts. David M. Banker, Esq., at Lowenstein Sandler PC, represents the official committee of unsecured creditors as counsel. In its petition, the Company listed $10 million to $50 million each in assets and debts. INNOVATIVE COS: Files Schedules of Assets and Liabilities --------------------------------------------------------- The Innovative Companies LLC filed with the U.S. Bankruptcy Court for the Eastern District of New York its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ---------- ----------- A. Real Property B. Personal Property $9,332,600 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $22,119,526 E. Creditors Holding Unsecured Priority Claims $17,445 F. Creditors Holding Unsecured Non-priority Claims $15,525,740 ---------- ------------ TOTAL $9,332,600 $37,662,711 A copy of Innovative Companies' schedules of assets and debts is available at http://bankrupt.com/misc/Innovative.SAL.pdf About The Innovative Companies Headquartered in Hauppauge, New York, The Innovative Companies LLC and its affiliates filed for Chapter 11 protection on April 17, 2009 (Bankr. E.D.N.Y. Lead Case No. 09-72669). Leslie A. Berkoff, Esq., at Moritt Hock Hamroff Horowitz LLP, represents the Debtors in their restructuring efforts. David M. Banker, Esq., at Lowenstein Sandler PC, represents the official committee of unsecured creditors as counsel. In its petition, the Company listed $10 million to $50 million each in assets and debts. INTERMET CORP: Plan Set for July 14 Confirmation Hearing -------------------------------------------------------- Intermet Corp. obtained from the U.S. Bankruptcy Court for the District of Delaware approval of the disclosure statement explaining its Chapter 11 plan. Intermet has already won support for the Plan from the official committee of unsecured creditors and first- and second-lien lenders. Intermet will seek confirmation of the Plan at a hearing on July 14. The Court will also consider approval July 14 of the sale of Intermet to first-lien lenders owed some $35 million, unless they are outbid. If the assets are sold to another buyer paying cash, the lenders are to receive the proceeds. If there is an offer at auction from someone other than a lender, the price must be at least $23 million cash. Holders of administrative expense claims under Sec. 503(b)(9) of the Bankruptcy Code, estimated at $6 million, are to recover 35% to 50% of their allowed claims. The second-lien lenders owed $107 million and unsecured creditors with $93 million in claims are expected to recover not more than 2%. Equity holders are out of the money. A full-text copy of the disclosure statement explaining the Debtors' Joint Chapter 11 Plan, dated May 28, 2009, is available at http://bankrupt.com/misc/intermet.DS.pdf Based in Fort Worth, Texas, Intermet Corp. designs and manufactures machine precision iron and aluminum castings for the automotive and industrial markets. The Company and its debtor- affiliates filed for Chapter 11 protection on August 12, 2008 (D. Del. Case Nos. 08-11859 to 08-11866 and 08-11868 to 08-11878). Dennis F. Dunne, Esq., Matthew S. Barr, Esq., and Michael E. Comerford, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve as the Debtors' counsel. James E. O'Neill, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' co-counsel. Kurtzman Carson Consultants LLC serves as the Debtors' claims, notice and balloting agent. An official committee of unsecured creditors has been formed in this case. In its petition, Intermet Corp. listed assets $50 million to $100 million and debts of $100 million to $500 million. This is the Debtors' second bankruptcy filing. Intermet Corp., along with its debtor-affiliates, filed for Chapter 11 protection on September 29, 2004 (Bankr. E.D. Mich. Case Nos. 04-67597 through 04-67614). Salvatore A. Barbatano, Esq., at Foley & Lardner LLP, represented the Debtors. In their previous bankruptcy filing, the Debtors listed $735,821,000 in total assets and $592,816,000 in total debts. Intermet Corporation emerged from its first bankruptcy filing in November 2005. ISOLAGEN INC: Agrees to Restructuring Plan with Stakeholders ------------------------------------------------------------ Isolagen, Inc., and its debtor-affiliates disclose that in connection with their initial bankruptcy filing, the Debtors have entered into a restructuring agreement with: (a) a large majority of the holders of the Company's 3.5% convertible subordinated notes, which were issued in November 2004, (b) the holders of roughly $500,000 of secured notes issued in April 2009, and (c) Viriathas Services LLC Series as agent for the group of DIP lenders. Pursuant to the terms and conditions of the Restructuring Agreement and subject to confirmation of the plan that memorializes the restructuring set forth in the agreement by order of the U.S. Bankruptcy Court for the District of Delaware, the parties to the Restructuring Agreement have agreed to this plan of reorganization: (i) the DIP Lenders and Pre-Petition Lenders will receive in full satisfaction of their claims, common stock of up to 61% of the reorganized company, subject to reduction to 49.9% of the reorganized company upon dilution resulting from exit financing in an amount not to exceed $2.0 million to be raised upon exit from bankruptcy; (ii) the Note Holders will receive in full satisfaction of the outstanding Notes -- in the principal amount of roughly $79.2 million as of June 18, 2009 -- in the aggregate: (a) an unsecured note in principal amount of $6.0 million due June 1, 2012 with interest payable in cash at a rate of 12.5% per annum or payable in kind by capitalizing such unpaid interest amount and adding it to principal at a rate of 15% per annum, redeemable at the option of the Company at 125% of face value and mandatorily redeemable if the Company raises $10.0 million in capital or is acquired by a third party; and (b) common stock of 33% of the reorganized company, subject to reduction to 27% of the reorganized company upon dilution resulting from an Exit Financing; (iii) the Debtors' general unsecured trade creditors (owed approximately $750,000) will receive in full satisfaction of their claims, common stock of 1% of the reorganized company, subject to reduction to 0.82% of the reorganized company upon dilution resulting from an Exit Financing; (iv) the management team of the reorganized company will receive common stock of 5% of the reorganized company, subject to reduction to 4.09% of the reorganized company upon dilution resulting from an Exit Financing, which equity will be subject to a 3-year vesting schedule whereby 50% shall vest on the first anniversary, 25% shall vest on the second anniversary and 25% shall vest on the third anniversary; (v) the Company's current common stock, options or similar equity securities (including those under or in connection with any employment agreements) shall be cancelled and extinguished and the holders shall not receive any distributions of property; and (vi) the Board of Directors of the reorganized company will be determined by the DIP Lenders and the providers of the Exit Financing. During the negotiations of the Restructuring Agreement, the Company attempted to retain an interest for the Company's common stockholders in the reorganized company. The terms are subject to the submission and approval of a plan of reorganization for the Company, and the occurrence of the effective date of any plan. The effective date will be subject to the conditions set forth in the plan, and as outlined in a disclosure statement which will be prepared by the Company and disseminated to all parties who are entitled to vote on the plan. It is anticipated that the effective date of the plan will be conditioned upon the provision of the exit financing. As reported by the Troubled Company Reporter on June 22, 2009, the the Bankruptcy Court approved a motion for an interim order for debtor-in-possession financing with certain lenders composed of a loan facility in an aggregate principal amount of up to $2,750,000 (subject to increase at the discretion of the DIP Lenders), of which up to $1,000,000 will be available to the Debtors from the date of the interim order until the entry of a final order. The proceeds from the DIP Facility will be used, among other things, to provide the Debtors with working capital for general corporate purposes and for expenses associated with the bankruptcy proceeding. The DIP Facility will accrue interest at the rate of 10% per annum (with a default rate of 18%) and will mature on the date a plan of reorganization is approved by the Bankruptcy Court, subject to acceleration upon certain event of defaults set forth in the DIP Facility agreement. The maturity date of the DIP Facility will also accelerate if a final order of the Bankruptcy Court has not been entered within 30 days of the interim order date. As indicated in the interim order, through the final DIP order process the DIP Lenders will seek "priming" liens to the extent that any parties possess secured claims against the Debtors. Any parties wishing to object to the Company's entry into the DIP Facility must file an objection on or before June 29, 2009 at 4:00 p.m. (Eastern Time). A hearing on "final" approval of the DIP Facility will be held on July 6, 2009 at 10:30 a.m. About Isolagen Based in Exton, Pennsylvania, Isolagen(TM), Inc., is an aesthetic and therapeutic company committed to developing and commercializing scientific advances and innovative technologies. The Company's technology platform includes the Isolagen Process(TM), a cell processing system for skin and tissue rejuvenation which is currently in development. Isolagen also commercializes a scientifically-advanced line of skincare systems through its majority-owned subsidiary, Agera(R) Laboratories, Inc. Isolagen, Inc., and its wholly owned subsidiary, Isolagen Technologies, Inc., filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code on June 15, 2009 (Bankr. D. Del. Case Nos. 09-12072 and 09-12073). Mary E. Augustine, Esq., at Ciardi Ciardi & Astin, P.C., in Wilmington, Delaware, represents the Debtors. The Debtors disclosed $1,000,001 to $10,000,000 in estimated assets and debts. ISOLAGEN INC: NYSE Amex to Delist Stock Effective June 29 --------------------------------------------------------- Isolagen, Inc., reports that its common stock will be delisted from the NYSE Amex, effective June 29, 2009. During the negotiations of the Restructuring Agreement, the Company attempted to retain an interest for the Company's common stockholders in the reorganized company. The Restructuring Agreement agreed to by the Debtors and (a) a large majority of the holders of the Company's 3.5% convertible subordinated notes, which were issued in November 2004; (b) the holders of roughly $500,000 of secured notes issued in April 2009; and (c) Viriathas Services LLC Series as agent for the group of DIP lenders, provides that in the proposed plan of reorganization the Company's current common stock, options or similar equity securities will be cancelled and extinguished and the holders will not receive any distributions of property. As the Company's common stock will not be eligible to receive any distributions of property pursuant to the proposed plan of reorganization, it is unlikely that the Company's currently outstanding common stock will be able to be listed on an alternative exchange or quotation system after the stock is delisted from the NYSE Amex. The Company has been advised that its common stock is currently trading on the "grey market" under symbol ILEIQ. There are no market makers for common stock in this market. Trades in grey market stocks are reported by broker-dealers to their self regulatory organization and the self regulatory organization distributes the trade data to market data vendors and financial Web sites so investors can track price and volume. Since grey market securities are not traded or quoted on an exchange or interdealer quotation system, investor's bids and offers are not collected in a central location so market transparency is diminished and best execution of orders is difficult. The grey market does not require companies whose securities are quoted upon its system to meet any listing requirements. About Isolagen Based in Exton, Pennsylvania, Isolagen(TM), Inc., is an aesthetic and therapeutic company committed to developing and commercializing scientific advances and innovative technologies. The Company's technology platform includes the Isolagen Process(TM), a cell processing system for skin and tissue rejuvenation which is currently in development. Isolagen also commercializes a scientifically-advanced line of skincare systems through its majority-owned subsidiary, Agera(R) Laboratories, Inc. Isolagen, Inc. and its wholly owned subsidiary, Isolagen Technologies, Inc., filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code on June 15, 2009 (Bankr. D. Del. Case Nos. 09-12072 and 09-12073). Mary E. Augustine, Esq., at Ciardi Ciardi & Astin, P.C., in Wilmington, Delaware, represents the Debtors. The Debtors disclosed $1,000,001 to $10,000,000 in estimated assets and debts. JOHN DIXON: Case Summary & 15 Largest Unsecured Creditors --------------------------------------------------------- Debtor: John Frederick Dixon 851 Irwin Street, Suite 302 San Rafael, CA 94901 Bankruptcy Case No.: 09-11851 Chapter 11 Petition Date: June 19, 2009 Court: Northern District of California (Santa Rosa) Judge: Alan Jaroslovsky Debtor's Counsel: Michael D. Cooper, Esq. mcooper@wendel.com Wendel, Rosen, Black and Dean LLP 1111 Broadway 24th Fl. P.O. Box 2047 Oakland, CA 94604-2047 Tel: (510) 834-6600 Estimated Assets: $10 million to $50 million Estimated Debts: $10 million to $50 million The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ ORIX Capital Markets, LLC personal guaranty $15,292,805 Attn: Chuck Crouch 1717 Main Street Dallas, TX 75201 Tel: (214) 237-2090 JP Morgan Chase Bank, N.A. personal guaranty $13,300,000 123 Mission Street - 5th Floor San Francisco, CA 94905 Attn: Mr. John Benson Tel: (415) 644-2104 City of Long Branch personal guaranty $3,400,000 Attn: Mr. Howard Woolley 344 Broadway, Municipal Bldg. Long Branch, NJ 07740 Tel: (732) 571-5645 First Republic Bank revolving line of $1,500,000 Attn: Mr. Brian Plotner credit 111 Pine Street, 3rd Floor San Francisco, CA 94104 Tel: (415) 288-8030 Legacy Bank personal guaranty $1,230,000 Attn: Mr. Julian L. Fruhling President 15100 N. 78th Way, Suite 101 Scottsdale, AZ 85260 Tel: (480) 778-2677 Bressler, Amery & Ross, P.C. legal fees $377,102 Eleanor, Yvonne & Douglas Rental security $2,300 Richardson deposit Lewis & Lewis security deposit $1,560 Denise Mills and Tim Reynolds security deposit $1,400 William Johnson security deposit $875 Morling & Company security deposit $780 Kevin Heaney security deposit $780 John L. Wright obligations unknown Herbert J. Jaffe obligations unknown Laura A. Ball obligations unknown Barclays Capital Real Estate obligations unknown Inc. JOSEPH ALFARO: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Joseph G. Alfaro Virginia Claudet Alfaro 1586 Blackstock Ave. Simi Valley, CA 93063 Bankruptcy Case No.: 09-17606 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Central District of California (San Fernando Valley) Judge: Maureen Tighe Debtors' Counsel: Blake Lindemann, Esq. 433 N Camden Dr 4th Fl Beverly Hills, CA 90210 Tel: (310) 279-5269 Fax: (310) 279-5370 Email: ecf@llgbankruptcy.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 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cacb09-17606.pdf The petition was signed by the Joint Debtors. KHAN GUL: Case Summary & 5 Largest Unsecured Creditors ------------------------------------------------------ Debtor: Khan Gul, Inc. 2205 W. Norvell Bryant Hwy Lecanto, FL 34461 Bankruptcy Case No.: 09-04970 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Middle District of Florida (Jacksonville) Judge: Chief Paul M. Glenn Debtor's Counsel: Leon M. Boyajan, II, Esq. 2303 West Highway 44 Inverness, FL 34453 Tel: (352) 726-1800 Email: lboyaja1@tampabay.rr.com Total Assets: $624,500 Total Debts: $1,203,000 A full-text copy of the Debtor's petition, including a list of its 5 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-04970.pdf The petition was signed by Sanam Gulzar. KV PHARMACEUTICAL: Form 10-K Filing Delay Prompts NYSE Monitoring ----------------------------------------------------------------- KV Pharmaceutical Company received a letter from NYSE Regulation, Inc., on June 16, 2009, informing the Company that it is subject to certain procedures as specified in Section 802.01E of the NYSE's Listed Company Manual as a result of its failure to timely file its Annual Report on Form 10-K for the fiscal year ended March 31, 2009 with the Securities and Exchange Commission. Section 802.01E provides that the NYSE will monitor the Company and the status of the Company's filing of the 2009 Annual Report for a six-month period from the filing due date for the 2009 Annual Report. If the 2009 Annual Report is not filed with the SEC upon expiration of such six-month period, the NYSE will, in its sole discretion, determine whether to provide the Company with an additional six-month period in which to file the 2009 Annual Report. The letter also states that, regardless of the procedures specified in Section 802.01E and if circumstances warrant, the NYSE could commence delisting procedures at any time during any period that is available to complete the filing of the 2009 Annual Report. As disclosed in its Notification of Late Filing on Form 12b-25 filed with the SEC on June 2, 2009, the Company has been unable to timely file the 2009 Annual Report due to an ongoing internal investigation being conducted by the Audit Committee of the Board of Directors of the Company. While the Audit Committee's investigation has been substantially completed, the Audit Committee has referred certain matters with a potential financial reporting impact resulting from its investigation to management for resolution. Until the matters can be resolved, the Company will not be in a position to file the 2009 Annual Report with the SEC. The Company expects the matters to be resolved before the end of July 2009. In addition, the Company is continuing to evaluate the financial statement implications of the provisions of the consent decree the Company entered into with the U.S. Food and Drug Administration on March 2, 2009 and of actions to recall all of the products it manufactured, suspend manufacturing and shipment of its products, substantially reduce its workforce and realign its cost and organizational structure. As a result of the investigation conducted by the Audit Committee and the matters related thereto currently under evaluation by management, the Company was unable to timely file its 2009 Annual Report with the SEC. The Company is in the process of preparing the 2009 Annual Report but is unable, at this time, to estimate when the 2009 Annual Report will be completed and filed. About KV Pharmaceutical Based in St. Louis, Missouri, KV Pharmaceutical Company (NYSE: KVa/KVb) -- http://www.kvpharmaceutical.com/-- is a fully integrated specialty pharmaceutical company that develops, manufactures, markets, and acquires technology-distinguished branded and generic/non-branded prescription pharmaceutical products. The Company markets its technology distinguished products through ETHEX Corporation, a subsidiary that competes with branded products, and Ther-Rx Corporation, the company's branded drug subsidiary. LAND RESOURCE: Wants Case Converted to Chapter 7 Liquidation ------------------------------------------------------------ Land Resource asks the U.S. Bankruptcy Court for the Middle District of Florida to convert its Chapter 11 bankrutpcy case to proceedings under Chapter 7 of the Bankruptcy Code. As reported by the Troubled Company Reporter on March 25, 2009, the Court converted the Chapter 11 cases of various affiliates to Chapter 7: 1. Blue Mist Farms, LLC 2. Bridge Pointe at Jekyll Sound, LLC 3. Clarks Hill Lake, LLC 4. Coastline Properties, LLC 5. Cumberland Harbour Realty, LLC 6. Hickory Bluff Marina Club, Inc. 7. Hickory Bluff Marina, LLC 8. Laird Bayou Brokerage, LLC 9. Laird Bayou, LLC 10. Laird Point Brokerage, LLC 11. Laird Point, LLC 12, Lakemont Advertising, LLC 13. Land Resource Group of NC, LLC 14. Land Resource Group, Inc. 15. Land Resource Meigs County, LLC, 16. Land Resource Orchards, LLC 17. Land Resource Satilla River, LLC 18 Land Resource Watts Bar, LLC 19. Land First Mortgage, LLC 20. LandFirst Title, LLC 21 LR Baytree Landing, LLC 22. LR Buffalo Creek, LLC 23, LR Riversea, LLC 24. LRC Aviation Company, LLC 25. LRC Holdings, LLC 26. LRC Realty, LLC 27 Roaring River Holding Company, Inc. 28. Roaring River, LLC 29. Rush Creek Land Company, Inc. 30. Southern HOA Management, LLC 31. Stillwater Coves, LLC 32. The Ridges at Morgan Creek, LLC, 33. Villages at Norris Lake, LLC Only Land Resource, LLC and Point Peter, LLLP remained as debtors- in-possession as they continue to market the sale of the Cumberland Harbour assets. On December 22, 2008, the Court approved bidding procedures for the sale of substantially all of Land Resource's assets. Land Resource conducted auction sales for its assets and the Court approved sales with respect to six developments. About Land Resource Headquartered in Orlando, Florida, Land Resource LLC -- http://www.landresource.com-- developed residential communities, includig coastal, lakefront and mountain locations in Georgia, North Carolina, West Virginia, Tennessee and Florida. The company and its affiliates filed for Chapter 11 protection on October 30, 2008 (Bankr. M.D. Fla. Lead Case No. 08-10159). Jordi Guso, Esq., at Berger Singerman, P.A., in Miami, Florida, and Richard D. Sierra, Esq., at Kosto & Rotella PA, in Orlando, Florida, represent the Debtors as counsel. Jeffrey I. Snyder, Esq., at Bilzin Sumberg Baena Price & Axelrod LLP, in Miami, Florida, represents the Committee of Creditors Holding Unsecured Claims as counsel. The Company listed assets of $100 million to $500 million and debts of $50 million to $100 million. Trustee Services Inc. is the Debtors' notice, claims and balloting agent. LARGE CARTAGE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Large Cartage, Inc. 2571 Busse Road, Suite 304 Elk Grove Village, IL 60007 Bankruptcy Case No.: 09-22556 Chapter 11 Petition Date: June 20, 2009 Court: United States Bankruptcy Court Northern District of Illinois (Chicago) Judge: Susan Pierson Sonderby Debtor's Counsel: Joel A. Schechter, Esq. Law Offices Of Joel Schechter 53 W Jackson Blvd, Ste 1025 Chicago, IL 60604 Tel: (312) 332-0267 Fax: (312) 939-4714 Email: joelschechter@covad.net 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/ilnb09-22556.pdf The petition was signed by Young Sun Park, president of the Company. MAHALO ENERGY: Court Denies Secured Lenders-Led Sale Process ------------------------------------------------------------ Bill Rochelle at Bloomberg reports that the U.S. Bankruptcy Court for the Eastern District of Oklahoma denied a proposal by Mahalo Energy (USA) Inc., to auction assets where secured lenders Ableco Finance LLC and Wells Fargo Foothill LLC will be the lead bidders. Ableco and Wells Fargo have jointly offered to purchase the assets for $350,000 plus their $73 million secured claims. The Court also denied the related $2 million debtor-in-possession loan from Ableco and Wells Fargo. Mr. Rochelle notes that both denials were "without prejudice," which means Mahalo can try again. Mahalo Energy (USA) Inc. has 300 producing wells in Oklahoma and 60,000 acres of gas-bearing shale formations. Tulsa, Oklahoma- based Mahalo Energy filed for Chapter 11 on May 21, 2009 (Bankr. E.D. Okla. Case No. 09-80795). Stephen W. Elliott, Esq., at Kline, Kline, Elliot & Bryant, PC, represents the Debtor in its restructuring efforts. The Debtor listed $10 million to $50 million in assets and $100 million to $500 million in debts. MANTUA LAND: Case Summary & Largest Unsecured Creditor ------------------------------------------------------ Debtor: Mantua Land Company Inc. 2940 Paddock Rd. Weston, FL 33331 Bankruptcy Case No.: 09-22377 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- BJK, LLC 09-22382 KHOC, LLC 09-22383 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Judge: John K. Olson Debtor's Counsel: Julianne R. Frank, Esq. 11382 Prosperity Farms Rd. #230 Palm Beach Gardens, FL 33410 Tel: (561) 626-4700 Fax: (561) 627-9479 Email: fwbbnk@bellsouth.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor identified Portage County with a tax claim for $43,771 as its largest unsecured creditor. A copy of the Company's largest unsecured creditor is available for free at: http://bankrupt.com/misc/flsb09-22377.pdf The petition was signed by Bernie J. Kosar, Jr., president of the Company. MATRIX DEVELOPMENT: Court Declines to OK Disclosure Statement ------------------------------------------------------------- Judge Trish Brown of the United States Bankruptcy Court for the District of Oregon last week declined to approve the disclosure statement explaining the proposed Plan of Reorganization of Matrix Development Corporation, also known as Legend Homes. NetDockets notes that Judge Brown's order does not provide specific detail with respect to the basis for denying approval of the Disclosure Statement. Objections and responses to the adequacy of the Disclosure Statement were filed by: * The Official Committee of Unsecured Creditors * Wachovia Financial Services Inc. * Stonewater Homeowners' Association * Illinois Union Insurance Company * JP Morgan Chase Bank N.A. * Bank of America N.A. * Columbia River Bank * KeyBank National Association * FountainCourt Owners Group Many of the objections challenged the level of disclosure contained in the proposed Disclosure Statement, particularly with respect to the likely amount of claims in various classes and the financial projections for the reorganized company. In its response to the objections filed in advance of the hearing on the Disclosure Statement, Matrix Development acknowledged that its proposed Plan of Reorganization was going to be modified which would result in necessary modifications to the Disclosure Statement as well. In response, the Court's order does set a required timeline for the Disclosure Statement approval and Plan of Reorganization confirmation process going forward. Among the highlights: * Creditors are required to make section 1111(b)(2) elections by June 19, 2009. However, elections can be revoked through July 22, 2009. * Matrix must file a motion for determination of the allowed secured and unsecured amounts of its lenders' claims for purposes of voting on the Plan by July 15, 2009. * Matrix is required to circulate (but not file) an amended Disclosure Statement and Plan of Reorganization by July 31, 2009. * The parties receiving the amended Disclosure Statement and Plan of Reorganization have until August 14, 2009 to provide comments to Matrix. * Matrix must file the amended Disclosure Statement and Plan of Reorganization with the court by August 28, 2009. * The deadline to object to the amended Disclosure Statement is September 4, 2009. Plan Terms As envisioned, the Plan will be funded by a combination of the Debtor's cash on hand as of the Plan's Effective Date and cash that is collected or generated by the Reorganized Debtor after the Plan's Effective Date. General unsecured claims are divided into six classes, Classes 18 through 23. Contractor Unsecured Claims under Class 21 will be paid an amaount equal to 40% of each allowed amount on the Plan's effective date or as soon thereafter as the allowed amount is determined. All of the Lenders' secured claims are placed in eight general classes, one for each Lender. Those classes are Classes 1, 2, 4, 6, 7, 8, 14 and 15. The payment terms and the maturity date of each allowed secured claims that is secured by one of the Retained Projects will be changed. The Lenders' claims that are secured by Collateral other than the Retained Projects are unimpaired by the Plan and the Lenders holding those claims will be permitted to exercise their foreclosure remedies with regard to that other Collateral. Equity Interests will be cancelled on the Plan's Effective Date, and the shareholders will not receive or retain on account of their Equity Interests any property or other consideration under the Plan. Construction Lien Claims in Class 3, to the extent the liens securing them are valid and have priority over the trust deed liens of the Lenders, will be paid in full from the proceeds of the Collateral securing those claims, in each case, when both (i) the validity, priority and extent of the lien has been finally determined, either by final order or by agreement of the lienholder, the Reorganized Debtor and the applicable Lender, and (ii) the Collateral securing such secured claim has been sold. The secured claims, if any, of JD Properties Vancouver LLC (Class 5), Dennis Pahlisch (Class 9), North Albany Investments, LLC (Class 10), creditors holding purchase money security interests in equipment (Class 11), and governmental units holding property tax claims (Class 12) are not impaired by the Plan. The secured claim of Rocky Mountain Land LLC in Class 13 is impaired by the Plan. The Collateral that secures that claim, as well as the Class 14 Claim of U.S. Bank, will be made subject to a lien in favor of the Reorganized Debtor to secure a claim for the costs and expenses incurred by the estate for obtaining and maintaining governmental approvals and permits for the Witham Oaks subdivision (the "506(c) Claim"). The lien securing the 506(c) Claim will be senior in priority to all liens on that Collateral other than liens securing property tax claims. The holder of the Class 13 Claim will be permitted to exercise its foreclosure remedies with respect to that Collateral, as will U.S. Bank. Classification of Claims and Interests The Plan segregates the various claims against and interests in the Debtors into 24 classes: Class 1 Bank of America's Secured Claim Class 2 Columbia River Bank's Secured Claims Class 3 Construction Lien Claims Class 4 First Independent Bank's Secured Claim Class 5 JD Properties Vancouver LLC's Secured Claim Class 6 JP Morgan Chase Bank's Secured Claim Class 7 KeyBank's Secured Claims Class 8 M&T Bank's Secured Claim Class 9 Dennis Pahlisch's Secured Claim Class 10 North Albany Investments, LLC's Secured Claim Class 11 PMSI Equipment Secured Claims Class 12 Property Tax Claims Class 13 Rocky Mounty Land LLC's Secured Claim Class 14 U.S. Bank's Secured Claim Class 15 Wachovia Financial Services Inc.'s Secured Claim Class 16 Priority Employee-Related Claims Class 17 Priority Consumer Deposit Claims Class 18 Customer Home Warranty Claims Class 19 Director and Officer Indemnity Claims Class 20 Surety Bond Claims Class 21 Contractor Unsecured Claims Class 22 Convenience Claims Class 23 Other Claims Class 24 Equity Interests Under the Plan, only the holders of allowed claims in Classes, 1, 2, 3, 6, 7, 8, 13, 14, 15, 21, 22, and 23 are entitled to vote. Classes 4, 5, 9, 10, 11, 12, 16, 17, 18, 19, and 20 are not impaired under the Plan and are deemed to have accepted the Plan without voting. Class 24 is conclusively deemed to have rejected the Plan and the holders of Equity Interests are not entitled to vote. A full-text copy of the disclosure statement with respect to Matrix Development Corp.'s Chapter 11 Plan of Reorganization, dated March 31, 2009, is available for free at: http://bankrupt.com/misc/matrixdevelopment.DS.pdf Headquartered in Portland, Oregon, Matrix Development Corp. aka Legend Homes -- http://www.legendhomes.com/-- designs and builds homes and condominiums. The Company filed for Chapter 11 protection on June 10, 2008 (Bankr. D. Ore. Case No. 08-32798). David A. Foraker, Esq., and Sanford R. Landress, Esq., at Greene & Markley P.C.; and Stephen T. Boyke, Esq, at the Law Office of Stephen T. Boyke, represent the Debtor as counsel. When the Debtor filed for protection from its creditors, it listed between $100 million and $500 million each in assets and debts. METROMEDIA INT'L: Files $140MM Malpractice Suit Against Paul Weiss ------------------------------------------------------------------ Zach Lowe at The American Lawyer reports that Metromedia International Group Inc. filed a $140 million malpractice lawsuit against its former corporate counsel at Paul, Weiss, Rifkind, Wharton & Garrison, the same day it filed for bankruptcy protection. According to The American Lawyer, Metromedia International claims that a mistake in an offering document written in the late 1990s ended up costing the Company $136 million a decade later. The American Lawyer relates that Brad Karp, the chairperson of Paul Weiss, said that the claim is "stale and frivolous" and that the firm looks forward to "a swift and favorable resolution." The American Lawyer states that Metromedia International hired Paul Weiss on retainer in the mid-1990s as its lead corporate counsel, and in 1997 it had Paul Weiss write up documents for the issuance of preferred stock. Metromedia International alleges that Paul Weiss attorneys mistakenly wrote the documents in a way that any holder of a preferred share could demand in certain circumstances a cash payment equivalent to accrued dividends. Metromedia International said in court documents that j such shareholders would only be able to convert their preferred shares to common shares. According to court documents, Metromedia International said that when it merged with another media company in 2007, preferred shareholders demanded the dividend-based pay outs, which ended up costing the Company $136 million more than they had anticipated, because the offering document Paul Weiss drew up "contains numerous mistakes and errors in draftmanship, coherence and professionalism." Court documents say that Metromedia International cites a 2004 memo from Paul Weiss in which firm lawyers mentioned an "inconsistency" in the offering document that "may" give shareholders a chance to argue for a "double-dip" of common stock and cash pay outs. Paul Weiss knew about its alleged mistake and should have refrained from any further representation of Metromedia Internationa, The American Lawyer states, citing the Company. Based in Charlotte, North Carolina, Metromedia International Group Inc. (PINK SHEETS: MTRM, MTRMP) -- http://www.metromedia- group.com/ -- through its wholly owned subsidiaries, owns interests in several communications businesses in the country of Georgia. The company's core businesses include Magticom Ltd., a mobile telephony operator located in Tbilisi, Georgia, Telecom Georgia, a long distance telephony operator, and Telenet, which provides Internet access, data communications, voice telephony and international access services. MIG, Inc., fka Metromedia International Group, Inc., filed for Chapter 11 bankruptcy protection on June 18, 2009 (Bankr. D. Delaware Case No. 09-12118). Scott D. Cousins, Esq., at Greenberg Traurig LLP assists the Company in its restructuring efforts. Debevoise & Plimpton LLP is the Company's special corporate counsel, while Potter Anderson & Corroon LLP is the Company's special litigation counsel. The Company listed $100 million to $500 million in assets and $100 million to $500 million in debts. MICHAEL PYLMAN: Filed Ch. 11 to Stop Sale of Cow Herd ----------------------------------------------------- According to Bill Rochelle at Bloomberg News, Michael Pylman Dairy LLC, a dairy farm in Buckeye, Arizona, with 12,000 cows, sought bankruptcy protection to stop the sale of the herd ordered by a state court. Michael Pylman owes $35.6 million to the secured lender M&I Marshall & Ilsley Bank. The bank had the state court appoint a receiver in May to manage the herd. The bank says it advanced $3 million to pay the costs of maintaining the herd since the receivership began. The bank, a subsidiary of Milwaukee-based Marshall & Ilsley Corp., is asking the bankruptcy court to allow the receiver to continue in possession of the herd since the farm lacks the cash to pay expenses. Michael Pylman Dairy L.L.C. filed for Chapter 11 on June 15, 2009 (Bankr. D. Ariz. Case No. 09-13232). William L. Needler, Esq., at William L. Needler and Associates Ltd., represents the Debtor. The Debtor disclosed assets and debts of $50 million to $100 million. MICHAEL VICK: Court Rejects Plan; Loses Peter Ginsberg as Counsel ----------------------------------------------------------------- Jeremy Redmon at The Atlanta Journal-Constitution reports that the Hon. Frank J. Santoro of the U.S. Bankruptcy Court for the Eastern District of Virginia has rejected Michael Vick's reorganization plan, calling it "unworkable". The Atlanta Journal relates that Mr. Vick talked about rejoining the National Football League as the key part of his plan to emerge from bankruptcy. The report states that under that plan, Mr. Vick would keep the first $750,000 of his annual income over the next five years and would give a percentage to creditors after that. According to The Atlanta Journal, Judge Santoro said that the Plan would leave Mr. Vick with up to a $9 million "hole" on top of the payments he would have to make to his creditors. Court documents say that as of December 2008, Mr. Vick had some $16 million in assets and about $20.4 million in debts. Citing Judge Santoro, The Atlanta Journal states that some of Mr. Vick's plans to make money -- including a $600,000 proposal for him to star in a documentary -- once he gets out of prison are speculative. Judge Santoro, The Atlanta Journal says, suggested that Mr. Vick should consider selling more of his assets, including one of the two houses he wants to keep for himself and his mother in Virginia. The Atlanta Journal quoted Judge Santoro as saying, "I am going to give you one more chance to come up with a workable reorganization plan, but that is your last chance. I think it would be important for you to make the best of it." The next court hearing is set for April 28, The Atlanta Journal says. The Atlanta Journal states that Mr. Vick's lawyers said that they have been handicapped in working with their client because he has been imprisoned in Leavenworth, Kansas. The lawyers asked Judge Santoro to let their client remain in a local jail in Virginia until the April 28 hearing, but the judge said that he didn't have the authority to do that but would consider ordering his appearance at the hearing, The Atlanta Journal relates. Counsel Withdraws From Mr. Vick's Bankruptcy Case The Associated Press reports that Peter Ginsberg, one of Mr. Vick's lawyers, has withdrawn from his bankruptcy case, saying that his withdrawal is in his former client's best interests. The AP relates that the federal appeals court in Atlanta upheld last week about $375,000 in sanctions against Mr. Ginsberg after he tried to get a judge removed from a bankruptcy case in Florida. He was also barred from practicing in the Bankruptcy Court of Middle Florida for five years, says The AP. About Michael Vick Michael Dwayne Vick, born June 26, 1980 in Newport News, Virginia, is a suspended National Football League quarterback under contract with the Atlanta Falcons team. In 2007, a U.S. federal district court convicted him and several co-defendants of criminal conspiracy resulting from felonious dog fighting and sentenced him to serve 23 months in prison. He is being held in the United States Penitentiary at Leavenworth, Kansas. Mr. Vick is also under indictment for two related Virginia state felony charges for his role in the dogfighting ring and related gambling activity. His state trial has been delayed until he is released from federal prison. He faces a maximum 10-year state prison term if convicted on both counts. Mr. Vick filed a Chapter 11 petition on July 7, 2008 (Bankr. E.D. Va. Case No. 08-50775). Dennis T. Lewandowski, Esq., and Paul K. Campsen, Esq., at Kaufman & Canoles, P.C., represent the Debtor in his restructuring efforts. Mr. Vick listed assets of $10 million to $50 million and debts of $10 million to $50 million. MSB ENERGY: Seeks to Employ Landauer and Ungerman as Counsel ------------------------------------------------------------ MSB Energy Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of Texas, Sherman Division, to employ counsel. "In order to effectuate a reorganization, propose a Plan of Reorganization and effectively move forward in its bankruptcy proceeding, Debtor desires to hire Arthur Ungerman and Joyce Lindauer as counsel in this matter" Ms. Landauer and Mr. Ungerman are solo practitioners of bankruptcy law and may be contacted at: Joyce W. Lindauer, Esq. Arthur Ungerman, Esq. Attorneys at Law 8140 Walnut Hill Lane, Suite 301 Dallas, Texas 75231 Tel: (972) 239-9055 Fax: (972) 239-9886 joyce@joycelindauer.com arthur@arthurungerman.com Ms. Lindauer and Mr. Ungerman have been paid a portion of a $25,000 retainer, which includes $1,039 for the filing fee in connection with the Chapter 11 proceeding. The compensation to be paid to Ms. Lindauer will be $295 per hour; the compensation to be paid to Mr. Ungerman will be $250 per hour; and paralegals and legal assistants, $50 to $75 per hour. Ms. Lindauer and Mr. Ungerman do not presently hold or represent any interest adverse to the interest of the Debtor or this estate and is disinterested within the meaning of 11 U.S.C. Sec. 101(14). MSB Energy filed for Chapter 11 on June 2, 2009 (Bankr. E.D. Tex. Case No. 09-41788). At the time of the filing, MSB estimated having assets and debts of $10,000,001 to $50,000,000. MERISANT WORLDWIDE: Wants to Implement Employee Severance Plan -------------------------------------------------------------- Merisant Worldwide, Inc., et al., ask the U.S. Bankruptcy Court for the District of Delaware to approve an employee severance plan for approximately 200 full-time employees in the United States to replace the existing Merisant U.S., Inc. Severance Pay Plan. The Debtors tell the Court that the theoretical maximum cost of the severance plan is significantly less expensive than the Merisant Plan. The accrual of potential cash benefits under the severance plan are: A. Non-Executives: Hourly Employees Exempt Employees ---------------- ---------------- Accrual Rate (per year of service) 1 week 2 weeks Minimum 2 weeks 4 weeks Maximum 26 weeks 52 weeks B. Executives: Severance Accrual Period ------------------------ Chief Executive Officer 18 months General Counsel 12 months Other Executives 6 months Under the severance plan, a "week" of severance pay means either (a) for a non-executive salaried employee, the employee's annual base rate on his or her termination date, divided by 52; and (b) for a non-executive hourly employee, the employee's regularly hourly base compensation rate on his or her termination date, multiplied by 40. A "month" of compensation for executives means the employee's annual base rate and target bonus on his or her termination date, divided by 12. The Debtors state that although the maximum aggregate cost of the severance plan could theoretically approximate $3,413,649, that total expense would be incurred only in the event that all 197 eligible employees other than the CEO and the general counsel were terminated. The Debtors add they have no current plans to make any significant reductions in force and believe it highly likely that only a small fraction of the total would ever be incurred. Headquartered in Chicago, Illinois, Merisant Worldwide Inc. -- http://www.merisant.com/-- sells low-calorie tabletop sweetener. The Debtor's brands are Equal(R) and Canderel(R). The Debtor has principal regional offices in Mexico City, Mexico; Neuchatel, Switzerland; Paris, France; and Singapore. In addition, the Debtor owns and operates manufacturing facilities in Manteno, Illinois, and Zarate, Argentina, and own processing lines that are operated exclusively for the Debtor at plants located in Bergisch and Stendal, Germany and Bangkrason, Thailand. As of March 28, 2008, the Debtor has 20 active direct and indirect subsidiaries, including five subsidiaries in the United States, six subsidiaries in Europe, five subsidiaries in Mexico, Central America and South America, and three subsidiaries in the Asia Pacific region, including Australia and India. Furthermore, the Debtor's Swiss subsidiary holds a 50% interest in a joint venture in the Philippines. Merisant Worldwide holds 100% interest in Merisant Company. Merisant Worldwide and five of its units filed for Chapter 11 protection on January 9, 2009 (Bankr. D. Del. Lead Case No. 09-10059). Sidley Austin LLP represents the Debtors in their restructuring efforts. Young, Conaway, Stargatt & Taylor LLP represents the Debtors' as co-counsel. Blackstone Advisory Services LLP is the Debtors' financial advisor. Epiq Bankruptcy Solutions, LLC, is the Debtors' Claims and Noticing Agent. Winston & Strawn LLP represents the official committee of unsecured creditors as counsel. Ashby & Geddes, P.A., is the Committee's Delaware counsel. The Debtors had $331,077,041 in total assets and $560,742,486 in total debts as of November 30, 2008. MOTOR COACH: Challenges Committee Professionals' Fees ----------------------------------------------------- Motor Coach Industries International, Inc., and its affiliates object to the last interim and final fee applications filed by professionals retained by the Official Committee of Unsecured Creditors in the Debtors' bankruptcy cases: * Chanin Capital Partners LLC, the Committee's financial Advisors; * Brown Rudnick LLP, the Committee's lead counsel; and * Womble Carlyle Sandridge & Rice PLLC, the Committee's local Delaware counsel. The Debtors ask the U.S. Bankruptcy Court for the District of Delaware to deny the fee applications and reduce the amounts requested to each individual professional's pro rata share of the $300,000 per month earmarked for the Committee's professional fees as set forth in the final order approving the Debtors' DIP financing. The Debtors contend that the professionals have exceeded the budget by over $2.5 million during the course of the bankruptcy cases. Franklin Mutual Advisors, LLC, joined in the Debtors' objections to Chanin's and Womble Carlyle's final fee applications. According to Franklin Mutual Advisors, it was manifest from the outset that the value of the estates could not satisfy the secured creditors in full and would leave nothing for the unsecured creditors represented by the Committee. Nevertheless, the Committee spent millions of dollars pursuing objections "so baseless that it withdrew them before they could be heard, and rejected, on the merits." Franklin Mutual Advisors compared the Committee's expenses to the Debtors' related to the confirmation of the Plan: Objection Outcome Panel Fees Debtors Fees --------- ------- ---------- ------------ DIP Financing and Final DIP Order $650,000 $650,000 Lock-Up Objection and Restructuring Agreements Order Entered Disclosure Disclosure $90,000 $30,000 Statement Statement Objections Approved Confirmation Plan confirmed $1,600,000 $1,750,000 Objection Appeal Appeal withdrawn $250,000 $250,000 Motor Coach Industries obtained a $200 million equity investment by Franklin Mutual Advisors as well as $75 million in senior credit from GE Capital, and an additional $155 million second lien loan from existing debtholders. NetDockets notes that Franklin Mutual Advisors filed numerous objections to the interim fee applications of all three Committee professionals throughout the course of Motor Coach's bankruptcy case. However, this is the first time that Motor Coach has also objected to the fees of the Committee's professionals. About Motor Coach Wilmington, Delaware-based Motor Coach Industries International, Inc. -- http://www.mcicoach.com/-- and its subsidiaries manufacture intercity coaches for the tour, charter, line-haul, scheduled service, and commuter transit sectors in the U.S. and Canada. They also operate seven sales centers and nine service centers in the U.S. and Canada and is the industry's supplier of aftermarket parts for most makes and models. The Company and six of its debtor-affiliates filed separate petitions for Chapter 11 relief on Sept. 15, 2008 (Bankr. D. Del. Lead Case No. 08-12136), to implement a pre-negotiated restructuring plan to be funded by Franklin Mutual Advisers, LLC and certain of its affiliates. The company's Canadian operations weren't included in the filing. At the time of filing, the Debtors listed assets of between $500,000,000 and $1,000,000,000 and liabilities of between $100,000,000 and $500,000,000. The Bankruptcy Court confirmed the Debtors' Second Amended Plan of Reorganization on January 28, 2009. Motor Coach completed its financial restructuring and emerged from bankruptcy in only seven months. The centerpiece of the Plan of Reorganization was a $200 million investment by funds managed by Franklin Mutual Advisers, which also converted their existing third lien secured debt into common stock and are now the Company's majority shareholders. The Debtors also obtained a $75 million senior credit facility from GE Capital, and an additional $155 million second lien loan from existing debtholders. MOTOR COACH: Creditors Panel Supports HSBC's $237,589 Admin. Fees ----------------------------------------------------------------- The Official Committee of Unsecured Creditors in the Chapter 11 cases of Motor Coach Industries International, Inc., and its debtor-affiliates support the application of HSBC Bank USA, National Association, as Indenture Trustee, for allowance and immediate payment of $237,589 in administrative expenses pursuant to Section 503(b) of the Bankruptcy Code. HSBC succeeded The Bank of New York, N.A., as Indenture Trustee to the Debtors' 11-1/4% Senior Subordinated Notes due 2009. HSBC retained Kelley Drye & Warren LLP to represent it in the Debtors' cases. HSBC facilitated the Creditors Committee's discharge of its fiduciary duties to its constituents, and HSBC should be reimbursed for the expenses incurred in connection therewith, the Committee said. About Motor Coach Wilmington, Delaware-based Motor Coach Industries International, Inc. -- http://www.mcicoach.com/-- and its subsidiaries manufacture intercity coaches for the tour, charter, line-haul, scheduled service, and commuter transit sectors in the U.S. and Canada. They also operate seven sales centers and nine service centers in the U.S. and Canada and is the industry's supplier of aftermarket parts for most makes and models. The Company and six of its affiliates filed separate petitions for Chapter 11 relief on Sept. 15, 2008 (Bankr. D. Del. Lead Case No. 08-12136), to implement a pre-negotiated restructuring plan to be funded by Franklin Mutual Advisers, LLC and certain of its affiliates. The company's Canadian operations weren't included in the filing. At the time of filing, the Debtors listed assets of between $500,000,000 and $1,000,000,000 and liabilities of between $100,000,000 and $500,000,000. The Bankruptcy Court confirmed the Debtors' Second Amended Plan of Reorganization on January 28, 2009. Motor Coach completed its financial restructuring and emerged from bankruptcy in only seven months. The centerpiece of the Plan of Reorganization was a $200 million investment by funds managed by Franklin Mutual Advisers, which also converted their existing third lien secured debt into common stock and are now the Company's majority shareholders. The Debtors also obtained a $75 million senior credit facility from GE Capital, and an additional $155 million second lien loan from existing debtholders. MUELLER WATER: S&P Affirms Corporate Credit Rating at 'B' --------------------------------------------------------- Standard & Poor's Ratings Services said that it affirmed its ratings on Mueller Water Products Inc., including the 'B' long- term corporate credit rating, and removed the ratings from CreditWatch, where S&P had placed them with negative implications on May 6, 2009. The outlook is negative. The ratings affirmation follows the company's completion of an amendment to its credit agreement that resets financial covenants. Still, if difficult end-market conditions persist, covenant headroom may again become limited. Interest rates on the company's secured debt increased substantially, but the company prepaid $100 million of term loans, which will offset interest expense. The ratings on Mueller reflect the company's highly leveraged financial risk profile and weak business risk profile. Mueller operates in the moderately cyclical niche markets of the North American water infrastructure market and maintains a good position. The company offers a full line of water infrastructure, flow control, and piping component system products, including ductile iron pipe, fire hydrants, and pipe fittings. "If operating performance remains weak and covenant headroom becomes limited, e.g., if it appears likely that the company's adjusted debt to EBITDA will be more than 7x in the second half of fiscal 2010, S&P could lower the ratings," said Standard & Poor's credit analyst Dan Picciotto. S&P could revise the outlook to stable if operating prospects improve and covenant headroom remains good. "If, for instance, debt to EBITDA declines to less than 6x in 2010 and further improvement appears likely, S&P could revise the outlook to stable," he continued. NORTHFIELD LABORATORIES: Proposes Baker & McKenzie as Counsel ------------------------------------------------------------- Northfield Laboratories Inc. seeks approval from the U.S. Bankruptcy Court for the District of Delaware to employ Baker & McKenzie LLP as counsel, pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code. Baker & McKenzie will provide services relating to the day-to-day administration of the Debtor's chapter 11 case and the issues that may arise in the case, including (i) advising the Debtors with respect to its powers and duties as debtor and debtor-in- possession, (ii) taking all necessary actions to protect and preserve the estate, (iii) taking all necessary actions in connection with a plan or plans of liquidation and related disclosure statement(s), and (iv) advising the Debtor in connection with any potential sale or abandonment of assets. Baker & McKenzie advised the Debtor pre-bankruptcy regarding numerous issues related to the Debtor's wind-down efforts and the preparation of the bankruptcy filing. Baker & McKenzie will charge the Debtor at its regular hourly rates and will seek approval of expenses incurred during the course of its representation of the Debtor. Baker & McKenzie may be contacted at: David F. Heroy, Esq., Andrew P.R. McDermott, Esq., Baker & McKenzie LLP, 130 East Randolph Street Chicago, Illinois 60601 Email: amcdermott@bakernet.com Phone: (312) 861-8000 Fax: (312) 698-2345 About Northfield Laboratories Headquartered in Evanston, Illinois, Northfield Laboratories Inc. (NASDAQ:NFLD) -- http://www.northfieldlabs.com/-- develops oxygen-carrying red blood cell to patients with low hemoglobin level. Northfield Laboratories Inc. filed for Chapter 11 on June 1, 2009 (Bankr. D. Del. Case No. 09-11924). Attorneys at Baker & McKenzie LLP, are bankruptcy counsel to the Debtor. Attorneys at Bifferato LLC serve as co-counsel. The Debtor's schedules of assets and liabilities disclosed $9,453,720 in assets against debts of $1,793,115. NORTHFIELD LABORATORIES: Winding Down; to Sell De Minimis Assets ---------------------------------------------------------------- Northfield Laboratories Inc. is winding down its assets and business after it failed to obtain Federal & Drug Administration approval for a reformulated version of PolyHeme, a hemoglobin- based oxygen-carrying red blood cell substitute. Its lease for its offices in Evanston, Illinois, has been terminated. The Debtor, accordingly, sought and obtained approval from the U.S. Bankruptcy Court for the District of Delaware to dispose of de minimis assets by selling those assets or abandoning them. The Debtor has identified certain assets at its Mt. Prospect, Illinois facility and former offices in Evanston, Illinois, that are of de minimis value compared to its total asset base. These assets are largely composed of office equipment, furniture and machinery that is depreciating in value, is no longer required for its business and burdens the estate by requiring storage and maintenance. Lead plaintiffs in a securities litigation against Northeast Laboratories request that any order granting the proposal provide a protocol and a mechanism for the retention, preservation and protection of the Debtor's books, records, clinical trial records and other documents, in whatever form they exist, that may be transferred as part of the transactions The lead Plaintiffs are Paul H. Shield, MD, Inc. Profit Sharing Plan and the Paul H. Shield, MD, Inc. Money Purchase Plan and named plaintiffs Alan Goodman, James Rourke, and Daniel Nesi, in the consolidated securities class action entitled In re Northfield Laboratories, Inc. Securities Litigation, Case No. 06CV1493 (Consolidated), filed in the United States District Court for the Northern District of Illinois. The securities class action allege violations by the Debtor and certain current and former officers and directors of the Debtor. Pursuant to the Court's order, the Debtor may be able to sell assets with a selling price of less than $25,000 without the need for approval of the Court for each transaction. For transactions involving a selling price of between $10,000 to $25,000, the Debtor will notify the U.S. Trustee, any statutory committee appointed in the Chapter 11 case, and the Lead Plaintiffs. The Debtor has filed a proposed Chapter 11 plan. A copy of the Plan and disclosure statement is available at: http://bankrupt.com/misc/NLAB_DiscStatement_Plan.pdf http://bankrupt.com/misc/NLAB_Ch11_Plan.pdf About Northfield Laboratories Headquartered in Evanston, Illinois, Northfield Laboratories Inc. (NASDAQ:NFLD) -- http://www.northfieldlabs.com/-- develops oxygen-carrying red blood cell to patients with low hemoglobin level. Northfield Laboratories Inc. filed for Chapter 11 on June 1, 2009 (Bankr. D. Del. Case No. 09-11924). Attorneys at Baker & McKenzie LLP, are bankruptcy counsel to the Debtor. Attorneys at Bifferato LLC serve as co-counsel. The Debtor's schedules of assets and liabilities disclosed $9,453,720 in assets against debts of $1,793,115. NOVEMBER 2005: Wants Snell & Wilmer to Assist in Land Use Matters ----------------------------------------------------------------- November 2005 Land Investors, L.L.C., asks the U.S. Bankruptcy Court for the District of Nevada for authorization to employ Snell & Wilmer, L.L.P., as special counsel. The firm will, among other things: a) analyze and advice the Debtor regarding the Nevada law and local governmental authority ordinances and regulations governing development, land use, contract and related matters concerning the real property owned by the Debtor; and b) provide Nevada legal opinions concerning the enforceability of financing for the Debtor's project and recorder restrictions and contractual obligations governing or affecting the use of the Debtor's property. The hourly rates of the firm's personnel are: Shareholders $375 - $450 Associates $160 - $350 Paralegals $185 Patricia J. Curtis, a partner at Snell & Wilmer, tells the Court that the firm billed $16,486 for its services rendered prepetition. The fees were deducted from payment of $17,306. A balance of $820 remains in the firm's trust account on behalf of the Debtor. Ms. Curtis assures the Court that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Ms. Curtis can be reached at: Snell & Wilmer, L.L.P. Hughes Center 3883 Howard Hughes Parkway, Suite 1100 Las Vegas, NV 89169-5958 Tel: (702) 784-5200 Fax: (002) 784-5252 About November 2005 November 2005 Land Investors, L.L.C., based in Las Vegas, filed for chapter 11 protection on May 8, 2009 (Bankr. D. Nev. Case No. 09-17474). Mike K. Nakagawa handles the case. Richard F. Holley, Esq., serves as bankruptcy counsel. The Debtor disclosed estimated assets and debts of $100 million to $500 million. OXFORD SQUARE HOLDINGS: Voluntary Chapter 11 Case Summary --------------------------------------------------------- Debtor: Oxford Square Holdings, LLC 1802 W. Jackson Oxford, MS 38655 Bankruptcy Case No.: 09-13098 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Northern District of Mississippi (Aberdeen) Debtor's Counsel: Craig M. Geno, Esq. Harris Jernigan & Geno, PLLC P.O. Box 3380 Ridgeland, MS 39158-3380 Tel: (601) 427-0048 Email: cmgeno@harrisgeno.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 Thomas Suszek. PACIFIC CAPITAL: Defers Interest Payments on Trust Preferreds ------------------------------------------------------------- Pacific Capital Bancorp has elected to defer regularly scheduled interest payments on $69.4 million of outstanding junior subordinated notes underlying trust preferred securities issued by: Issuer Amount Initial Rate Maturing ------ ------ ------------ -------- PCC Trust I $13,750,000 6.335% 2033 PCC Trust II 6,190,000 6.580% 2033 PCC Trust III 10,310,000 6.800% 2033 PCB Trust I 39,176,000 7.189% 2036 ----------- $69,426,000 The terms of the junior subordinated notes and the trust documents allow the Company to defer payments of interest for up to 20 consecutive quarterly periods without default or penalty. During the deferral period, the trusts will likewise suspend the declaration and payment of dividends on the trust preferred securities. Also during the deferral period, the Company may not, among other things and with limited exceptions, pay cash dividends on or repurchase its common stock or preferred stock nor make any payment on outstanding debt obligations that rank equally with or junior to the junior subordinated notes. Accordingly, the Company has also suspended the payment of cash dividends on its outstanding common stock and preferred stock. The Company believes that the deferral of interest payments on the junior subordinated notes and the suspension of cash dividend payments on its common and preferred stock will preserve approximately $8.0 million per quarter (compared with the continuing level of interest and dividend payments in the first quarter of 2009) and bolster its capital ratios. Pacific Capital Bank, N.A., must maintain a minimum Tier 1 leverage ratio of 8.5% as of June 30, 2009 and 9.0% as of September 30, 2009, and a minimum total risk-based capital ratio of 11.0% as of June 30, 2009 and 12.0% as of September 30, 2009. "Maintaining strong capital ratios is essential for ensuring the health of the Bank during these difficult economic times and is in the best long-term interest of all of our shareholders," said George Leis, President & Chief Executive Officer of Pacific Capital Bancorp. "We believe the actions we have announced today are the most prudent course of action and will improve our flexibility to consider other actions that may need to be taken in order to achieve our targeted capital ratios. We would expect to resume paying dividends when such payments would be consistent with our overall financial performance and capital requirements." Pacific Capital Bancorp (Nasdaq:PCBC) -- http://www.pcbancorp.com/ -- is the parent company of Pacific Capital Bank, N.A., a nationally chartered bank that operates 46 branches under the local brand names of Santa Barbara Bank & Trust, First National Bank of Central California, South Valley National Bank, San Benito Bank and First Bank of San Luis Obispo. At March 31, 2009, Pacific Capital Bancorp's balance sheet showed $9.2 billion in assets and $8.4 billion in liabilities. PACIFIC ENERGY: Union Oil Sues to Pursue Rights to Oil Fields ------------------------------------------------------------- Union Oil Co. of California filed a complaint before the U.S. Bankruptcy Court for the District of Delaware against Pacific Energy Resources Ltd., alleging that it deserves first priority to proceeds from two Alaskan offshore oil fields because a PERL subsidiary owes it more than $26.3 million in unpaid operating expenses and expenditures, according to Law360. Headquartered in Long Beach, California, Pacific Energy Resources Ltd. -- http://www.pacenergy.com/-- engages in the acquisition and development of oil and gas properties, primarily in the United States. The Company and seven of its affiliates filed for Chapter 11 protection on March 8, 2009 (Bankr. D. Del. Lead Case No. 09-10785). Attorneys at Pachulski Stang Ziehl & Jones LLP, represent the Debtors as counsel. The Debtors proposed Rutan & Tucker LLP as special corporation and litigation counsel; Schully, Roberts, Slattery & Marino, PLC, as special oil and gas and transactional counsel; Devlin Jensen as special Canadian counsel; Scott W. Winn, at Zolfo Cooper Management, LLC, as chief restructuring officer; Lazard Freres & Co. LLC as investment banker; and Albrecht & Associates, Inc., as agent for the Debtors in the sale of their oil and gas properties. Omni Management Group, LLC, is the claims, balloting, notice and administrative agent for the Debtors. When the Debtors filed for protection from their creditors, they listed assets and debts of between $100 million and $500 million each. PACIFIC ENERGY: Gets Final OK to Obtain DIP Facility from Lenders ----------------------------------------------------------------- On June 4, 2009, the U.S. Bankruptcy Court for the District of Delaware issued its final order authorizing Pacific Energy Resources Ltd., et al., to obtain secured, superpriority postpetition financing from J. Aron & Company and certain other lenders: (A) a term loan (the "PERL DIP Term Facility") in an amount equal to the Prepetition Beta Obligations, but excluding any make-whole payments payable as a result of the prepayment thereof, (B) a term loan (the "PEAO DIP Term Facility") in an amount equal to the Prepetition Alaska First Lien Obligations, but excluding any make-whole payments payable as a result of the prepayment thereof, and (C) a revolving loan facility of up to $44,000,000. As of the Petition Date, the outstanding principal amount of the Prepetition Beta Obligations was $44,199,569. As of the Petition Date, the outstanding principal amount of the Prepetition Alaska First Lien Obligations was $98,446,809. The PERL Refunding Amount and the PEAO Refunding Amount will used to fully and completely satisfy the Prepetion Beta Obligations and the Prepetition Alaska First Lien Obligations, respectively. The DIP Agents and the DIP Lenders are granted allowed superpriority administrative expense claims in the cases and any successor cases. The applicable DIP Collateral Agent, for the benefit of itself, the DIP Lenders, and the Postpetition Hedge Provider are also granted automatically perfected security interests in and liens on all of the applicable DIP Collateral, including all cash collateral. A full-text copy of the Court's final order approving the DIP Facility is available at: http://bankrupt.com/misc/PARL.FinalDIPOrder.pdf Headquartered in Long Beach, California, Pacific Energy Resources Ltd. -- http://www.pacenergy.com/-- engages in the acquisition and development of oil and gas properties, primarily in the United States. The Company and seven of its affiliates filed for Chapter 11 protection on March 8, 2009 (Bankr. D. Del. Lead Case No. 09-10785). Attorneys at Pachulski Stang Ziehl & Jones LLP, represent the Debtors as counsel. The Debtors proposed Rutan & Tucker LLP as special corporation and litigation counsel; Schully, Roberts, Slattery & Marino, PLC, as special oil and gas and transactional counsel; Devlin Jensen as special Canadian counsel; Scott W. Winn, at Zolfo Cooper Management, LLC, as chief restructuring officer; Lazard Freres & Co. LLC as investment banker; and Albrecht & Associates, Inc., as agent for the Debtors in the sale of their oil and gas properties. Omni Management Group, LLC, is the claims, balloting, notice and administrative agent for the Debtors. When the Debtors filed for protection from their creditors, they listed between $100 million and $500 million each in assets and debts. PALM VILLAGE: Seeks to Employ GSGH as Bankruptcy Counsel -------------------------------------------------------- Palm Village LLC seeks approval from the U.S. Bankruptcy Court for the District of Nevada to employ Gonzalez Saggio & Harlan LLP as counsel pursuant to Section 363 of the Bankruptcy Code. The firm will, among other things, advise, consult with and represent the Debtor concerning (i) the status of the Chapter 11 case and claims against the estate, (ii) the rights and remedies of the Debtor with respect to assets of the estate, and (iii) the commencement of suits and proceeding relating to assets of the estate. The firm will charge the Debtor at these rates: Hourly Rate ----------- Nancy L. Allf, Esq. $400 Associates $250 Paralegals $110 The firm has received a $15,000 retainer. Nancy L. Allf, attorney at the firm, says her firm does not represent any interest adverse to the Debtor or its estate. The firm may be contacted at: Nancy L. Allf, Esq. Nancy_allf@gshllp.com 441 E. Bonneville Ave. Suite 100 Las Vegas, NV 89101 About Northfield Laboratories Headquartered in Evanston, Illinois, Northfield Laboratories Inc. (NASDAQ:NFLD) -- http://www.northfieldlabs.com/-- develops oxygen-carrying red blood cell to patients with low hemoglobin level. Northfield Laboratories Inc. filed for Chapter 11 on June 1, 2009 (Bankr. D. Del. Case No. 09-11924). Attorneys at Baker & McKenzie LLP serve as the Debtor's general counsel. Attorneys at Bifferato LLC serve as co-counsel. At the time of its Chapter 11 filing, the Debtor disclosed assets of $10,000,001 to $50,000,000 and debts of $1,000,001 to $10,000,000. PARKSIDE VILLAGE: Files for Chapter 11 Bankruptcy Protection ------------------------------------------------------------ Randolph K. Carter, managing member of Parkside Village LLC, has filed a Chapter 11 bankruptcy petition for the Company in the U.S. Bankruptcy Court for the Western District of Virginia. Court documents say that Mr. Carter filed the bankruptcy petition two days before it was set to go up for auction. An appraisal done in January puts Parkside Village -- which consists of 18 building lots, including six already built three- bedroom, 21/2-bath townhouses -- at $1.9 million, according to court documents. Parkside Village listed $1,907,256 in assets and $1,552,136 in debts, court documents say. Sally Voth at The Northern Virginia Daily reports that Mr. Carter blamed his lender, United Bank, for issues surrounding the development on Ox Road just south of Southridge Court, saying that "the lender in this case is causing the problem, not us. There has been some contingent with regard to pricing, etc. [Filing] the Chapter 11 bankruptcy is part of what's just going to be an ongoing lawsuit." According to The Northern Virginia Daily, an ad for a trustee's sale said that the 12 remaining building lots were to be sold at auction on June 11. The Northern Virginia Daily quoted Mr. Carter as saying, "[United Bank] filed a foreclosure, but that's all they have got in their defense right now. The Chapter 11 filing sets aside the foreclosure. Then, the lawsuit follows. Hopefully, heads will roll down there after that. It's another forced default by United Bank, another internal screw-up that could've been avoided." Parkside Village LLC is based in Woodstock, Virginia. PATHEON INC: S&P Gives Stable Outlook; Affirms 'B+' Corp. Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it has revised its outlook on Patheon Inc. to stable from negative. At the same time, S&P affirmed all of the ratings on Patheon, including the 'B+' corporate credit rating. "The rating actions are based on recognition of the relatively new management team's progress at restructuring Patheon's operations, as evidenced by the improvement in EBITDA margins and funds from operations," said Standard & Poor's credit analyst Arthur Wong. The ratings on Research Triangle Park, North Carolina-based Patheon Inc. reflect its weak business risk profile, highlighted by the company's continued restructuring efforts to address overcapacity and various operating issues, and an aggressive financial risk profile. These factors are partially offset by Patheon's strong customer relationships, the diversity of outsourced pharmaceutical services, and the expected positive demand trends for such services. Patheon, one of the largest providers of pharmaceutical development and commercial manufacturing services to pharmaceutical companies, still faces formidable operating challenges. While it benefits from the increasing trend toward outsourcing by pharmaceutical companies, and a troubled acquisition in 2006 have hampered Patheon's ability to capitalize on its favorable position. Under a new management team since late 2007, Patheon has thus far successfully restructured its operations, shedding facilities and focusing on organic growth and higher-margin revenues. The company also embarked on various productivity improvement initiatives to restore profitability. The company closed its Carolina facility in Puerto Rico in early 2009 and sold its York Mills, Toronto facility in April 2009, although Patheon is still operating the facility as it transfers production there to another facility. The closures bring the number of Patheon manufacturing sites to ten and improve its profitability and cash flow generation through greater utilization of its existing facilities. PAUL MOLLER: Files for Chapter 11 Bankruptcy Protection ------------------------------------------------------- Paul Moller has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Eastern District of California. Mark Anderson at Sacramento Business Journal reports that $46 million in assets -- much of which include stock in Mr. Moller's Davis-based flying car company Moller International Inc. and its subsidiary Freedom Motors. According to Business Journal, Mr. Moller is the Moller International's majority shareholder, and he had been providing funds for the company to continue operating, including refinancing personal real estate to fund the company. The report states that as of March 31, 2009, Mr. Moller has lent Moller International some $3 million and deferred collecting rent of almost $500,000 from the company as well as his own salary in the sum of more than $1 million. Mr. Moller, says the report, has been trying to sell the company and some of its proprietary technology for several years. Business Journal relates that Mr. Moller listed $6.3 million in debts owed to creditors that include: -- Exchange Bank, which holds a $3.3 million secured claim against Moller International's main facility in Davis; and -- investors and financial service providers with claims on Moller International's headquarters or agricultural land Mr. Moller owns in Dixon. According to Business Journal, Mr. Moller has $5.9 million in secured debts, while its unsecured debts total $414,735. Moller International said in the U.S. Securities and Exchange Commission that it is pursuing additional sources of capital, enough to let it continue developing and manufacturing its Rotapower engine, Skycar, and Aerobot products. Business Journal relates that Moller International accumulated deficit of $43.7 million as of March 31, 2009. Dixon, California-based Paul Moller is an inventor, engineer, and flying-car company founder. PDC LOVELESS: Case Summary & 19 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: PDC Loveless, LLC 5840 Banneker Road, Suite 110 Columbia, MD 21044 Bankruptcy Case No.: 09-21124 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. ------ -------- PDC-Collingbrook LLC 09-21128 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of Maryland (Baltimore) Judge: Duncan W. Keir Debtor's Counsel: Gary R. Greenblatt, Esq. Mehlman, Greenblatt & Hare, LLC 723 South Charles Street, Suite LL3 Baltimore, MD 21230 Tel: (410) 547-0300 Fax: (410) 547-7474 Email: grgreen@mehl-green.com Total Assets: $2,020,445 Total Debts: $11,151,664 A full-text copy of the Debtor's petition, including a list of its 19 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/mdb09-21124.pdf The petition was signed by Michael A. Carnock, managing member of the Company. PDCC DEVELOPMENT: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: PDCC Development LLC dba Palm Desert Country Club 77-200 California Drive Palm Desert, CA 92211 Bankruptcy Case No.: 09-23674 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Central District of California (Riverside) Debtor's Counsel: Robert M. Yaspan, Esq. Law Offices of Robert M. Yaspan 21700 Oxnard St., Ste 1750 Woodland Hills, CA 91367 Tel: (818) 905-7711 Fax: (818) 501-7711 Email: ryaspan@yaspanlaw.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/cacb09-23674.pdf The petition was signed by Randy Case, manager of the Company. PENINSULA CLEAR: Section 341(a) Meeting Scheduled for July 14 ------------------------------------------------------------- The U.S. Trustee for Region 15 will convene a meeting of creditors in Peninsula Clear Lake Texas, L.P.'s Chapter 11 case on July 14, 2009, at 10:39 a.m. The meeting will be held at the Office of the U.S. Trustee, 515 Rusk Avenue, Suite 3401, Third Floor, Houston, Texas. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in all bankruptcy cases. All creditors are invited, but not required, to attend. This Meeting of Creditors offers the one opportunity in a bankruptcy proceeding for creditors to question a responsible office of the Debtor under oath about the company's financial affairs and operations that would be of interest to the general body of creditors. Houston, Texas-based Peninsula Clear Lake Texas, L.P., is a single asset real estate. The Company filed for Chapter 11 on June 1, 2009 (Bankr. S. D. Tex. Case No. 09-33906). Erin E. Jones, Esq., at Barron Newburger Sinsley PLLC represents the Debtor in its restructuring efforts. The Debtor listed $10 million to $50 million in assets and $1 million to $10 million in debts. PENTON BUSINESS: Weak Performance Cues S&P to Junk Corp. Rating --------------------------------------------------------------- Standard & Poor's Rating Services lowered its corporate credit ratings and issue-level ratings on Penton Business Media Holdings Inc. and related entities. S&P lowered the corporate credit ratings on the companies to 'CCC' from 'B-' and removed the ratings from CreditWatch where they were placed with negative implications on April 21, 2009. The outlook is negative. S&P also lowered the issue-level ratings on Penton Business Media Inc.'s and Penton Media Inc.'s $700 million first-lien facility due 2013 to 'CCC' (the same as the corporate credit rating) from 'B-'. At the same time, S&P revised the recovery rating on this debt to '4', which indicates S&P's expectation of average (30% to 50%) recovery in the event of a payment default, from '3.' At the same time, S&P lowered the issue-level ratings on the companies' $266 million second-lien term facility due 2014 to 'CC' (two notches lower than the corporate credit rating) from 'CCC'. The recovery rating is unchanged at '6', which indicates S&P's expectation of negligible (0% to 10%) recovery in the event of a payment default. "The rating actions reflect Penton's weak operating performance and repercussions for its liquidity amid tightening covenants," said Standard & Poor's credit analyst Tulip Lim. "We are concerned that the company may violate financial covenants this year and may not be able to afford an amendment given its already thin interest coverage." S&P analyze Penton Business Media Holdings on a consolidated basis with Penton Business Media Inc. and Penton Media Inc. New York City-based Penton (formerly Prism Business Media Holdings Inc.) is a business-to-business media company. S&P could lower the rating if the industry downturn and tight credit market conditions persist, and continue to depress the company's operating performance and hamper its ability to amend its credit agreement. Assuming debt repayment of only mandatory amortization, the company could violate its financial covenant if its last-12-months ended June 30, 2009, EBITDA as calculated per the covenant definition declines by 2%-3% or its last-12-months ended Sept. 30, 2009, EBITDA does not increase 5%-6% from the last 12 months ended March 31, 2009. In S&P's view, factors likely to contribute to these scenarios are a prolonged recession combined with the company's failure to deliver sufficient cost cuts. An outlook revision to stable, which S&P consider unlikely over the near-to-intermediate term, would require a consistent increase in overall profitability, continued positive discretionary cash flow generation, and an improved margin of compliance with the financial covenants. POMARE LTD: Files Plan to Stop Sale to Maui Divers -------------------------------------------------- Bill Rochelle at Bloomberg reports that Pomare Ltd., doing business as Hilo Hattie, has filed a proposed Chapter 11 plan and an explanatory disclosure statement. The Plan provides for a 5% recovery to unsecured creditors within five years. According to the report, Pomare filed the plan to stave off motions by the U.S. Trustee and the official committee of unsecured creditors to convert the Chapter 11 case to a liquidation under Chapter 7 or to appoint a Chapter 11 trustee. The U.S. Trustee claimed that Hilo Hattie's reorganization efforts have failed, and the company's financial condition is far worse now than it was at the commencement of the case. The Creditors Committee was given authority from the bankruptcy judge to locate a buyer after the creditors filed a motion for the appointment of a Chapter 11 trustee. Maui Divers of Hawaii Ltd., according to the Committee, has agreed to (i) pay $1 million to cover the cost of curing defaults on contracts that are part of the sale, and (ii) invest $2 million equity in the business. Based in Honolulu, Hawaii, Pomare Ltd., dba Hilo Hattie, is a tourist-destination retailer with operations chiefly in Hawaii. It has seven stores in Hawaii and two in California. The Company filed for Chapter 11 relief on October 2, 2008 (Bankr. D. Hawaii Case No. 08-01448). Chuck C. Choi, Esq., and James A. Wagner, Esq., at Wagner Choi & Verbrugge, represent the Debtor as counsel. Alexis M. McGinness, Esq., and Ted N. Pettit, Esq., at Case Lombardi & Pettit, represent the Official Committee of Unsecured Creditors. In its schedules, the Debtor listed total assets of $15,825,657, and total debts of $13,767,047. PRELUDE INVESTMENT: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Prelude Investment LLC 1539 Rodeo Rd Arcadia, CA 91007 Bankruptcy Case No.: 09-25621 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Central District of California (Los Angeles) Judge: Barry Russell Debtor's Counsel: Robert Berke, Esq. Berke Law Offices 7108 De Soto Ave # 206 Canoga Park, CA 91303 Tel: (818) 804-5729 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 Jing Gong, managing member of the Company. PRIME CAROLINA: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Prime Carolina, LLC 231 Fennel Dun Circle Candler, NC 28715 Bankruptcy Case No.: 09-10698 Chapter 11 Petition Date: June 19, 2009 Court: Western District of North Carolina (Asheville) Judge: George R. Hodges Debtor's Counsel: William E. Loose, Esq. billloose@skyrunner.net William E. Loose, Attorney at Law P.A. 68 North Market Street Asheville, NC 28801 Tel: (828) 255-0569 Estimated Assets: $11,000,016 Estimated Debts: $6,249,315 The Debtor's Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Fairview Excavating construction debt $239,033 410 Mills Gap Road Fletcher, NC 28732 Dan Grammatico Signature Homes construction debt $111,188 231 Fennel Dunn Circle Candler, NC 28715 Civil Design Concepts design $23,550 P.O. Box 5432 Asheville, NC 28813 Capital One loan $21,002 Shamburger Design Studio design $16,861 Kessel Engineering engineering $9,368 Steve McAbee and McAbee & $8,485 Associates Transworld collection $8,485 Adsharp trade debt $5,506 Prime Interests $5,350 Crown & Company $5,315 Carolina Tractor & Equipment equipment $4,957 Roberts & Stevens legal services $3,633 William Scotsman $1,976 Professional Appraisal services $1,200 Services Imaging Technologies copies $540 NCO Financial collections $302 Prime Development $691 William Kimpton expenses $643 R. Stanford Webb Agency Inc. $302 The petition was signed by James P. Egnew. PROPEX INC: Files New Version of Liquidating Plan ------------------------------------------------- Propex Inc., Propex Holdings Inc., Propex Concrete Systems Corporation, Propex Fabrics International Holdings I Inc., and Propex Fabrics International Holdings II delivered to the U.S. Bankruptcy Court for the Eastern District of Tennessee a Joint Plan of Liquidation and Disclosure Statement on June 18, 2009. The New Plan supersedes the proposed Joint Plan of Reorganization filed by the Debtors on October 29, 2008. The New Plan constitutes a single Plan of Liquidation for all of the Debtors. Propex Chief Executive Officer Woody McGee says that although the Debtors' Asset Purchase Agreement with Xerxes Operating Company, LLC, and Xerxes Foreign Holding Corp. provides for the sale of substantially all of the Debtors' assets, certain assets and approximately $4,800,000 in cash still remain in the Debtors' estates. Thus, he notes, the Debtors' estates are currently being liquidated and will be providing distributions to creditors. According to Mr. McGee, the Plan contemplates the winding down of the Debtors' estates and the resolution of outstanding claims against the Debtors pursuant to Sections 1129(a) and 1123 of the Bankruptcy Code. The Plan designates claims against, and interests in, the Debtors into 5 separate classes. Upon the Plan Effective Date, all assets will be transferred to a liquidating trust and a liquidating trustee will be vested with the sole authority to, among other things, review, initiate, or pursue any and all causes of action. The Liquidating Trust, which will be administered by the Liquidating Trustee, will serve primarily as the vehicle for making distributions provided under the Plan. The Plan provides for the payment in full of Allowed Administrative Expense Claims and Allowed Priority Tax Claims prior to any payment to other creditors or classes. After making those payments, the Plan contemplates sufficient cash remaining in the estate to make payments in full to Allowed Secured Claims and Allowed Priority Claims. Any remaining cash in the Debtors' estates will be utilized by the Liquidating Trustee to review, pursue or file claim objections. To the extent there is cash remaining in the estate after payment of fees and costs, the remaining cash will be distributed by the Liquidating Trustee on a pro rata basis to Allowed General Unsecured Claims. The Debtors estimate that unsecured creditors will receive about 1.7 cents to 2 cents per dollar on their claims. The Debtors believe that any alternative confirmation of the Plan would result in significant delays, litigation costs or impaired recoveries. Moreover, the Debtors believe that their creditors will receive greater and earlier recoveries under the New Plan than those that would be achieved pursuant to a converted Chapter 7 cases or under an alternative plan. Funding Sources The Debtors' estates currently have approximately $2.1 million of cash on hand remaining from the proceeds of the Asset Sale. The Debtors' estates also have an additional amount of about $2.7 million of cash on hand or the "Carve Out Amount." The Carve Out Amount will first be used to pay the fees and expenses of estate professionals, including Debtors' attorneys, the Official Committee of Unsecured Creditors' attorneys, and Woody McGee, as the Debtors' Agent under the Plan, for work performed up to and including the Effective Date. Creation of a Liquidating Trust Prior to the Plan Effective Date, the Debtors' Agent will retain power and control over the Debtors' estates. On the Effective Date, the employment of the Debtors' Agent will be terminated and the Liquidating Trust will be established and become effective. Title to the Trust Assets automatically vests in the Liquidating Trust at the Plan Effective Date, without the need to execute any documents or instruments of transfer. The Trust Assets will be reserved, preserved, assigned, transferred, and conveyed to the Liquidating Trust free and clear of liens, claims and encumbrances or interests except to the extent those liens and claims are retained under the Plan. Gene Davis will serve as Liquidating Trustee and will assume liability for and incur the obligation to make the distributions required to be made under the Plan. The Liquidating Trust will terminate at the end of three years from the Effective Date. Upon the completion of his duties, Mr. Davis may terminate the Liquidating Trust prior to the three-year period. Upon termination and complete satisfaction of his duties under the Liquidating Trust Agreement, Mr. Davis will be forever discharged and released from all powers, duties, responsibilities, and liabilities other than those attributable to the gross negligence or willful misconduct. On the Effective Date, the prepetition credit agreement, the indenture, unsecured notes, common stock and any other notes, or other instruments or documents evidencing or creating any indebtedness or obligations of a Debtor that are impaired under the Plan will be canceled, and the obligations of the Debtors under any agreements, indentures, or certificates of designation governing the prepetition secured claims, common stock and any other claims or any notes, bonds, indentures, or other instruments or documents evidencing or creating any claims against a debtor that are impaired under the Plan will be enjoined. A full-text copy of the Propex Joint Plan of Liquidation is available for free at: http://bankrupt.com/misc/Propex_LiquidationPlan.pdf A full-text copy of the Propex Disclosure Statement is available for free at: http://bankrupt.com/misc/Propex_1stDisclosureStatement.pdf http://bankrupt.com/misc/PropexInc_DisclosureStatement2.pdf About Propex Inc. Headquartered in Chattanooga, Tennessee, Propex Inc. -- http://www.propexinc.com/-- produces geosynthetic, concrete, furnishing, and industrial fabrics and fiber. It also produces primary and secondary carpet backing. Propex operates in North America, Europe, and Brazil. The company and its debtor-affiliates filed for Chapter 11 protection on January 18, 2008 (Bankr. E.D. Tenn. Case No. 08-10249). The Debtors selected Edward L. Ripley, Esq., Henry J. Kaim, Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston, Texas, to represent them. The Official Committee of Unsecured Creditors tapped Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld, LLP, in New York, to be its counsel. Propex Inc., and its affiliates delivered to the Court a Joint Plan of Reorganization and Disclosure Statement on October 29, 2008. As of June 29, 2008, the Debtors' balance sheet showed total assets of US$562,700,000, and total debts of US$551,700,000. Bankruptcy Creditors' Service, Inc., publishes Propex Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by Propex Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PROPEX INC: Treatment of Claims Under Liquidation Plan ------------------------------------------------------ The Joint Plan of Liquidation filed by Propex Inc. and its debtor- affiliates groups claims against and interests in the Debtors into five classes: Class Description Treatment Estimated Amt. ----- ----------- ------------------- -------------- N/A Administrative Paid in full. $47,000 to Expense Claims $75,000 N/A Allowed Priority Paid in full. -- Tax Claims 1 Allowed Secured Paid in (1) cash $1,000 to Claims equal to the value of $25,000 the Allowed Secured Claimant's interest in the property of the estate, (2) cash equal o the full amount of the Allowed Secured Claim; (3) other treatment as determined by the Liquidating Trustee and held by the Bankruptcy Court as constituting the indubitable equivalent of that Claimants' Allowed Secured Claim. 2 Allowed Priority Paid in full. $21,000 to Claims $100,000 3 Allowed General Pro rata share of the $175 million Unsecured Claims General Unsecured to Claim Distribution, $210 million if any, available from the Liquidating Trust after payment in full of Allowed Administrative Expense Claims, Allowed Priority Tax Claims, and Class 1 & 2 Claims 4 Allowed Interests Cancelled. -- 5 Allowed Holdings Cancelled. -- Claims & Interests Claim Classes 1 and 2 have unimpaired status, while Claim Classes 3, 4 and 5 have impaired status. About Propex Inc. Headquartered in Chattanooga, Tennessee, Propex Inc. -- http://www.propexinc.com/-- produces geosynthetic, concrete, furnishing, and industrial fabrics and fiber. It also produces primary and secondary carpet backing. Propex operates in North America, Europe, and Brazil. The company and its debtor-affiliates filed for Chapter 11 protection on January 18, 2008 (Bankr. E.D. Tenn. Case No. 08-10249). The Debtors selected Edward L. Ripley, Esq., Henry J. Kaim, Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston, Texas, to represent them. The Official Committee of Unsecured Creditors tapped Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld, LLP, in New York, to be its counsel. Propex Inc., and its affiliates delivered to the Court a Joint Plan of Reorganization and Disclosure Statement on October 29, 2008. As of June 29, 2008, the Debtors' balance sheet showed total assets of US$562,700,000, and total debts of US$551,700,000. Bankruptcy Creditors' Service, Inc., publishes Propex Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by Propex Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PROPEX INC: Seeks Approval of Disclosure Statement -------------------------------------------------- Propex Inc. and its affiliates ask the U.S. Bankruptcy Court for the Eastern District of Tennessee to approve the Disclosure Statement accompanying their Joint Plan of Liquidation as containing "adequate information" within the meaning of Section 1125(a)(1) of the Bankruptcy Code. The Debtors aver that their Disclosure Statement contains descriptions and summaries of: (a) various events preceding the commencement of these Chapter 11 cases; (b) material events occurring during these Chapter 11 cases; (c) the Debtors' Plan; (d) the nature of known claims against the Debtors' estates; (e) risk factors affecting the Plan; (f) alternatives to confirmation of the Plan; (g) financial information and valuations that would be relevant to a creditor's decision to accept or reject the Plan; and (h) the securities law and federal tax law consequences of the Plan. Upon approval of the Disclosure Statement, the Debtors propose to transmit by mail to all creditors entitled to vote on the Plan a solicitation package comprised of a notice of the Disclosure Statement Order, a copy of the Liquidation Plan, a copy of the Disclosure Statement, forms and ballots, and other information as the Court may require. The Debtors seek that the voting record date for purposes of determining which holders of the Debtors' stock, bonds, debentures, notes, and other securities are entitled to receive the Solicitation Package and to vote on the Plan should be the date on which the Court approves the Disclosure Statement. The Debtors propose that no later than five days after the date the Disclosure Statement is approved by the Court, they will cause to mail a Solicitation Package to each entity listed on their schedules of assets and liabilities, as amended from time to time prior to the Voting Record Date and to each entity having filed with the Court a proof of claim that has not been disallowed, withdrawn, or expunged on or before the Voting Record Date. The Debtors also seek an order that Wilmington Trust, the indenture trustee of the Debtors' 10% senior notes due Dec. 1, 2012, be required to compile a list of current nominal or record holders of the Bond and to deliver the Solicitation Package to the Nominal Holders. Rule 3017(d) of the Federal Rules of Bankruptcy Procedure provides that ballots for accepting or rejecting a plan should conform substantially to Form No. 14. A full-text copy of the Debtors' proposed ballots is available for free at: http://bankrupt.com/misc/Propex_Ballot1.pdf http://bankrupt.com/misc/Propex_Ballot2.pdf http://bankrupt.com/misc/Propex_Ballot3.pdf The Debtors ask the Court to establish the date and time by which all ballots must be received by the Solicitation Agent. In addition, the Debtors propose these voting procedures: (a) Separate claims held by a single creditor in a particular class will be aggregated as if that creditor held one claim against the Debtors in that class, and the votes related to those claims will be treated as a single vote to accept or reject the Plan. (b) Creditors must vote all of their claims within a particular class either to accept or reject the Plan, and may not split their vote. Accordingly, a ballot that partially rejects and partially accepts the Plan will be counted as a single affirmative vote to accept the Plan. (c) Ballots that fail to indicate an acceptance or rejection of the Plan, but that are otherwise properly executed and received prior to the Ballot Return Date, will be counted as a vote accepting the Plan. (d) Only ballots that are timely received with original signatures will be counted. Unsigned ballots will not be counted. Facsimile ballots, other than ballots that comply with the procedures noted in this Motion, will not be counted unless the claimant receives the written consent of the Debtors. (e) Any ballot that is illegible or contains insufficient information to permit the identification of the claimant will not be counted. (f) Any ballot cast by a person or entity that does not hold a claim in a class that is entitled to vote to accept or reject the Plan will not be counted. (g) Any creditor who has failed or purchased duplicate Class 3 claims or claims against multiple Debtors arising from the same transaction will be provided with only one Solicitation Package and one ballot and be permitted to vote only a single claim, regardless of whether the Debtors have objected to those duplicate claims. The Debtors ask the Court to set a hearing on August 26, 2009, at 9:00 a.m., to consider confirmation of the Plan. Any objection to the confirmation of the Plan must be in writing, must state the grounds for the objection, must refer with specificity the text of the Plan to which the objection is made, and must be served on the Debtors, the Official Committee of Unsecured Creditors, and the U.S. Trustee. The Court will convene a hearing on July 15, 2009, to consider adequacy of the Disclosure Statement. Any party who wishes to file a written objection to the Disclosure Statement has until July 10 to do so. About Propex Inc. Headquartered in Chattanooga, Tennessee, Propex Inc. -- http://www.propexinc.com/-- produces geosynthetic, concrete, furnishing, and industrial fabrics and fiber. It also produces primary and secondary carpet backing. Propex operates in North America, Europe, and Brazil. The company and its debtor-affiliates filed for Chapter 11 protection on January 18, 2008 (Bankr. E.D. Tenn. Case No. 08-10249). The Debtors selected Edward L. Ripley, Esq., Henry J. Kaim, Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston, Texas, to represent them. The Official Committee of Unsecured Creditors tapped Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld, LLP, in New York, to be its counsel. Propex Inc., and its affiliates delivered to the Court a Joint Plan of Reorganization and Disclosure Statement on October 29, 2008. As of June 29, 2008, the Debtors' balance sheet showed total assets of US$562,700,000, and total debts of US$551,700,000. Bankruptcy Creditors' Service, Inc., publishes Propex Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by Propex Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PROPEX INC: Seeks to Set July 31 as Admin. Claims Bar Date ---------------------------------------------------------- Propex Inc. and its affiliates ask the U.S. Bankruptcy Court for the Eastern District of Tennessee to establish July 31, 2009, 5:00 p.m. prevailing Eastern Time, as the deadline for filing motions for administrative expense claims arising on or after the Petition Date, except for requests of payment of Professionals' Administrative Expense Claims. The Debtors have filed a Plan of Liquidation on June 18, 2009. In connection with their efforts to obtain confirmation of that Plan, the Debtors note they must evaluate the amount and validity of administrative expenses, if any, claimed by creditors under Section 503 of the Bankruptcy Code. "The establishment of that date as the Administrative Claims Bar Date will enable the Debtors to begin their analysis of creditors' administrative expense in a timely and efficient manner," says Mark W. Wege, Esq., at King & Spalding, LLP, in Houston, Texas. The Debtors seek that these persons or entities will not be required to file a motion on or before the Administrative Claims Bar Date: (a) any person or entity that has already properly filed that motion for payment of administrative expenses; and (b) any person or entity requesting payment for Professionals' Administrative Expense Claims. The Debtors also seek that any holder of an unpaid cure claim that arises from the assumption of an executory contract or unexpired lease, must file a proof of claim based on that assumption on or before the Administrative Claims Bar Date, unless otherwise stated in the order authorizing that assumption. The Debtors further ask the Court to rule that any creditor seeking payment of an administrative expense who failed to file a motion requesting payment of that administrative expense by the Administrative Claims Bar Date will be entitled to receive any payment or distribution of property from the Debtors and their estates, and will be forever barred from seeking payment of that administrative expense from the Debtors. Pursuant to Rule 2002(m) of the Federal Rules of Bankruptcy Procedure, the Debtors seek to distribute the Administrative Claims Bar Date to these parties: * The Office of the United States Trustee; * Those persons on the Master Service List; * Each member of the Official Committee of Unsecured Creditors and its attorneys; * All state and local government authorities where the Debtors maintain assets or conducted business operations on the Petition Date or within 3 years prior to the Petition Date; * All known potential holders of claims; and * The District Director of Internal Revenue for the Eastern District of Tennessee. About Propex Inc. Headquartered in Chattanooga, Tennessee, Propex Inc. -- http://www.propexinc.com/-- produces geosynthetic, concrete, furnishing, and industrial fabrics and fiber. It also produces primary and secondary carpet backing. Propex operates in North America, Europe, and Brazil. The company and its debtor-affiliates filed for Chapter 11 protection on January 18, 2008 (Bankr. E.D. Tenn. Case No. 08-10249). The Debtors selected Edward L. Ripley, Esq., Henry J. Kaim, Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston, Texas, to represent them. The Official Committee of Unsecured Creditors tapped Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld, LLP, in New York, to be its counsel. Propex Inc., and its affiliates delivered to the Court a Joint Plan of Reorganization and Disclosure Statement on October 29, 2008. As of June 29, 2008, the Debtors' balance sheet showed total assets of US$562,700,000, and total debts of US$551,700,000. Bankruptcy Creditors' Service, Inc., publishes Propex Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by Propex Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PROPEX INC: Changes Name to Fabrics Estate Following Xerxes Sale ---------------------------------------------------------------- Pursuant to the Revised Asset Purchase Agreement with Xerxes Operating Company, LLC, and Xerxes Foreign Holding Corp., Propex Inc. and its affiliates were required to change their names prior to the closing. The Debtors have done so and now provide notice to the Court and all parties-in-interest of these name changes: * Propex Holdings, Inc. is now known as Fabrics Estate Holdings Inc. * Propex Inc. is now known as Fabrics Estate Inc. * Propex Fabrics International Holdings I Inc., is now known as Fabrics Estate International Holdings I Inc. * Propex Fabrics International Holdings II Inc., is now known as Fabrics Estate International Holdings II Inc. * Propex Concrete Systems Corporation is now known as Concrete Estate Systems Corporation. Pursuant to the terms of the Revised APA and to avoid any confusion on the part of the Court or any parties-in-interest, the Debtors seek that the caption of their cases be changed to reflect their current names: IN THE UNITED STATES BANKRUPTCY COURT FOR THE EASTERN DISTRICT OF TENNESSEE SOUTHERN DIVISION In re : : FABRICS ESTATE INC., : Case No. 08-10249 FABRICS ESTATE HOLDINGS INC., : Case No. 08-10250 CONCRETE ESTATE SYSTEMS : CORPORATION : Case No. 08-10252 FABRICS ESTATE INTERNATIONAL : HOLDINGS I INC., : Case No. 08-10253 FABRICS ESTATE INTERNATIONAL : HOLDINGS II, INC. : Case No. 08-10254 : Chapter 11 Debtors. : : Jointly Administered Under : Case No. 08-10249 About Propex Inc. Headquartered in Chattanooga, Tennessee, Propex Inc. -- http://www.propexinc.com/-- produces geosynthetic, concrete, furnishing, and industrial fabrics and fiber. It also produces primary and secondary carpet backing. Propex operates in North America, Europe, and Brazil. The company and its debtor-affiliates filed for Chapter 11 protection on January 18, 2008 (Bankr. E.D. Tenn. Case No. 08-10249). The Debtors selected Edward L. Ripley, Esq., Henry J. Kaim, Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston, Texas, to represent them. The Official Committee of Unsecured Creditors tapped Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld, LLP, in New York, to be its counsel. Propex Inc., and its affiliates delivered to the Court a Joint Plan of Reorganization and Disclosure Statement on October 29, 2008. As of June 29, 2008, the Debtors' balance sheet showed total assets of US$562,700,000, and total debts of US$551,700,000. Bankruptcy Creditors' Service, Inc., publishes Propex Bankruptcy News. The newsletter tracks the chapter 11 proceedings undertaken by Propex Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PROSPECT HOMES: Proposes as DurretteBradshaw Counsel ---------------------------------------------------- Prospect Homes of Richmond LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division, to hire DurretteBradshaw PLC as counsel effective as of June 2, 2009. The Debtor requires the assistance of competent and experienced bankruptcy counsel to enable it to perform their statutory duties. Such assistance will involve, without limitation, preparation and filing of all required statements and schedules; evaluation of the Debtor's financial condition; negotiations with the Debtor's creditors; representation in all contested matters and adversary proceeds that may arise in the reorganization case; formation of a plan of reorganization; and all other matters reasonably necessary to assist the Debtor in performing its duties and successfully reorganizing. The Debtor proposes to employ DB under a previously agreed retainer of $50,000 which was paid prepetition. DB will provide services at its customary hourly rates for comparable services. The firm's standard hourly rates are: Roy M. Terry, Jr. - $315.00, John C. Smith - $235.00, and Elizabeth L. Gunn - $215.00. Prospect Homes of Richmond, Inc. -- http://www.prospecthomes.com/ -- is a home builder. Prospect Homes filed for Chapter 11 on June 2, 2009 (Bankr. E.D. Va. Case No. 09-33528). Judge Douglas O. Tice, Jr. handles the case. At the time of its Chapter 11 filing, the Debtor disclosed assets and debts of $50,000,001 to $100,000,000. PROSPECT HOMES: Proposes to Sell Richmond Property for $364,000 --------------------------------------------------------------- Prospect Homes of Richmond LLC asks the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division, to enter an order authorizing Debtor to sell property of the estate free and clear of all liens, claim, encumbrances and interests, with such liens, claims, encumbrances and interests to attach to the proceeds of such sale. The proceeds from the sale shall be placed in escrow and distributed once the Debtor determines the validity, priority and extent of liens against the property, which would include filing an adversary proceeding to make such determination if necessary. In addition, the Debtor seeks the authority to have the settlement agent pay, in full, from the sale proceeds, standard costs to be paid by Debtor as seller at closing. The Debtor constructs building and sells homes. Prepetition the Debtor entered into an Agreement of Sale with buyers C.P. and T.C. to sell property commonly known as 3002 Triple Notch Way, Richmond, Virginia 23233 and more particularly described as: Lot 2, Block A, in the community or subdivision of Three Notch Place, county of Henrico, Virginia. The Debtor is to sell the Property to Buyers for the purchase price of $364,000 to be paid in cash. As of the Petition Date, liens in the total amount of approximately $327,685 existed on the Property. The Debtor does not waive its rights to challenge the validity or extent of any of the liens. Prospect Homes of Richmond, Inc. -- http://www.prospecthomes.com/ -- is a home builder. Prospect Homes filed for Chapter 11 on June 2, 2009 (Bankr. E.D. Va. Case No. 09-33528). Judge Douglas O. Tice, Jr. handles the case. At the time of its Chapter 11 filing, the Debtor disclosed assets and debts of $50,000,001 to $100,000,000. PROTEIN SCIENCES: Sent to Chapter 7 Bankruptcy by Creditors ----------------------------------------------------------- Michael Bathon at Bloomberg reports that creditors of Protein Sciences Corp. filed an involuntary Chapter 7 petition against the company before the U.S. Bankruptcy Court for the District of Delaware (Case No. 09-12151). The Creditors want the company liquidated to satisfy claims. A unit of Emergent BioSolutions Inc. holds a bulk of the debt listed on the petition at $11.5 million. According to Bloomberg, Emergent, last May, agreed to acquire "substantially all of the assets" of Protein Sciences after the company was granted "fast-track" status by the Food and Drug Administration for its FluBlok vaccine, according to a statement. As part of the deal, Emergent would pay $28 million in cash and take on Protein Science's debt, a 5-year note worth $20 million that could be converted to Emergent stock at a price of $12.50 a share, and as much $30 million more if FluBlok sales met certain milestones. Protein Sciences Corp. is a biopharmaceutical company that started making a vaccine to protect humans against the H1N1 influenza virus last week. Protein Sciences said in a June 15 statement it has started manufacturing "the first and only" vaccine, PanBlok, that would be able to combat the virus. The company said it would be able to produce at least 100,000 doses of the vaccine a week. There have been more than 40,000 confirmed cases of the Human Influenza H1N1 virus, commonly known as swine flu, and 180 deaths confirmed worldwide, according to data compiled by Bloomberg. The World Health Organization raised its alert on the virus to level six, the highest level, declaring the first influenza pandemic since 1968. PROVIDENT ROYALTIES: Files for Chapter 11 in Dallas --------------------------------------------------- Dawn McCarty at Bloomberg reports that Provident Royalties LLC and 26 affiliates filed for bankruptcy protection before the U.S. Bankruptcy Court for the Northern District of Texas in Dallas. The company listed assets of as much as $10 million and as much as $500 million in debt. Dallas-based Provident Royalties LLC invests in mineral interests. PUB PROPERTIES: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Pub Properties, LLC 588 Ramapo Valley Road Oakland, NJ 07436 Bankruptcy Case No.: 09-25870 Debtor-affiliates filing separate Chapter 11 petition: Entity Case No. ------ -------- Cousins Hospitality, LLC 09-25873 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of New Jersey (Newark) Judge: Rosemary Gambardella Debtor's Counsel: Chad Brian Friedman, Esq. Ravin Greenberg LLC 101 Eisenhower Parkway Roseland, NJ 07068 Tel: (973) 226-1500 Email: cfriedman@ravingreenberg.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Paul W. Beshlian, managing member of the Company. PUNTO VERDE: S&P Affirms 'BB' Rating on $40 Mil. Taw-Exempt Notes ----------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB' rating on the $40 million 5.8% secured tax-exempt notes from Punto Verde Grantor Trust 2006-1 and removed it from CreditWatch, where it was placed with negative implications on May 21, 2009. The rating on the notes reflects the lower of the ratings on the two underlying securities: Morgan Stanley ACES SPC's 6.92% secured fixed-rate notes series 2006-19 due Aug. 2, 2021 ('BB'); and Fannie Mae's $4.25 billion 6.25% global notes due May 15, 2029 ('AAA'). The rating action follows the June 15, 2009, affirmation of S&P's 'BB' rating on one of the underlying securities, Morgan Stanley ACES SPC's series 2006-19 notes, and its removal from CreditWatch negative, where it was placed on May 18, 2009. QUEBECOR WORLD: Plan Confirmation Hearing on June 30 ---------------------------------------------------- Quebecor World Inc., Quebecor World (USA), Inc., and its affiliated debtors, will seek confirmation from U.S. Bankruptcy Court for the Southern District of New York of their proposed plan of reorganization on June 30. As reported by the Troubled Company Reporter, the Debtors have extended until June 22, 2009, at 5:00 p.m. (Eastern Time), the balloting deadline to receive votes on the US Plan. The joint hearing on the confirmation and approval of both the US Plan and the Canadian Plan remains scheduled for June 30, 2009, as Quebecor World continues on the timetable contemplated under its proposed reorganization plans so as to successfully emerge from both the US and Canadian Insolvency Proceedings by mid-July 2009. In that connection, the exit financing in support of the Company's emergence is well advanced, and anticipated to be in place to fund the Company's exit from creditor protection. About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (CA:IQW) -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. The company has operations in Mexico, Brazil, Colombia, Chile, Peru, Argentina, and the British Virgin Islands. Ernst & Young, Inc., the monitor of Quebecor World Inc., and its affiliates' reorganization proceedings under the Canadian Companies' Creditors Arrangement Act, filed a petition under Chapter 15 of the Bankruptcy Code before the U.S. Bankruptcy Court for the Southern District of New York on September 30, 2008, on behalf of QWI (Bankr. S.D.N.Y. Case No. 08-13814). The Chapter 15 case is before Judge James M. Peck. Kenneth P. Coleman, Esq., at Allen & Overy LLP, in New York, serves as counsel to the Chapter 15 petitioner. QWI and certain of its subsidiaries commenced the CCAA proceedings before the Quebec Superior Court (Commercial Division) on January 20, 2008. The following day, 53 of QWI's U.S. subsidiaries, including Quebecor World (USA), Inc., filed petitions under Chapter 11 of the U.S. Bankruptcy Code. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for Chapter 11 bankruptcy before the U.S. Bankruptcy Court for the Southern District of New York (Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP, represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The Company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective January 28, 2008. QWI is the only entity involved in the CCAA proceedings that is not a Debtor in the Chapter 11 Cases. As of June 30, 2008, Quebecor World's unaudited consolidated balance sheet showed total assets of US$3,412,100,000 total liabilities of US$4,326,500,000 preferred shares of US$62,000,000 and total shareholders' deficit of US$976,400,000. Bankruptcy Creditors' Service, Inc., publishes Quebecor World Bankruptcy News. The newsletter tracks the parallel proceedings undertaken by QWI and its affiliates under United States and Canadian bankruptcy laws. (http://bankrupt.com/newsstand/or 215/945-7000) QUEBECOR WORLD: SocGen (Canada), et al., Object to Plan ------------------------------------------------------- Fourteen parties-in-interest objected to the confirmation of the Quebecor World (USA) Inc. and its affiliates' Third Amended Joint Plan of Reorganization: (a) Societe Generale (Canada); (b) Private Noteholders, including American United Life Insurance Company, Barclays Bank PLC, Deutsche Bank AG, Deutsche Bank Securities Inc., Midland National Life Insurance Company Annuity, Modern Woodmen of America, North American Company for Life and Health Insurance/Annuity, Provident Life and Accident Insurance Company, The Northwestern Mutual Life Insurance Company, The Paul Revere Life Insurance Company, Symetra Life Insurance Company, Transamerica Financial Life Insurance Company, Transamerica Life Insurance Company, Wachovia Capital Markets LLC, and Wilton Reassurance Life Insurance Company of New York; (c) Export Development Canada; (d) The Graphic Communications Conference of the International Brotherhood of Teamsters National Pension Fund; (e) GCIU-Employer Retirement Fund; (f) Virginia Department of Taxation; (g) Louisiana Department of Revenue; (h) The State of New Jersey, Division of Taxation and Department of Labor and Workforce Development; (i) Muller Martini Corp.; (j) Ewing Daniel Brown; (k) Nicholas Gordon; (l) Herbert Turner; (m) Brian Booker; and (n) Daniel Koo. (o) Riverside Claims, LLC, * SocGen Societe Generale (Canada), a secured lender, complains that the Plan unfairly discriminates against SocGen by treating its claims differently than more of the Syndicate Lenders. While the Plan groups the Syndicate Lenders and SocGen into the same class, the Plan effectively forces SocGen into litigation and continue the adversary proceeding filed by the Official Committee of Unsecured Creditors against SocGen and Computershare Trust Company of Canada, Michael Luskin, Esq., at Hughes Hubbard & Reed LLP, in New York, points out. Mr. Luskin asserts that even if SocGen wins the Adversary Proceeding in full, its recovery will be significantly reduced by the legal and other costs necessary to defend the Adversary Proceeding. Thus, the Debtors' grouping of the Syndicate Lenders and SocGen into one class with separate treatment is improper, and the Proposed Plan should not be confirmed. Moreover, Mr. Luskin asserts that the Debtors fail to demonstrate that SocGen would receive as much under the Proposed Plan as it would in liquidation. Since the Proposed Plan fails to provide SocGen at least as much as it would receive in Chapter 7 liquidation, the Proposed Plan cannot be confirmed. * Private Noteholders To protect the claims asserted under Section 502(h) of the Bankruptcy Code from prejudice in the event the Official Committee of Unsecured Creditors were to recover any portion of the payments in the adversary proceeding filed by the Official Committee of Unsecured Creditors seeking to avoid and recover the Payments under Sections 547 and 550, the Private Noteholders object to the Plan on two grounds: (1) through the proposed substantive consolidation as to distributions under the Plan and the Canadian Plan, the Plan would deprive the Private Noteholders of any claims based on the guaranties of the Private Notes, without any legal or evidentiary basis; and (2) by permitting holders of the Debtors' equity interests to retain those interests while the Private Noteholders would not receive full payment of their claims, the Plan would violate the Absolute Priority Rule. The Private Noteholders do not object to the Plan to the extent it is based on voluntary compromises of creditors' claims. However, the Private Noteholders ask the Court to deny confirmation of the Plan to the extent the Plan would deprive the Private Noteholders of recovery on their potential claims by imposing substantive consolidation and violating the absolute priority rule without any valid grounds for doing so. * Export Development Canada EDC complains that the only ballot it received for voting under the Plan was a Class 4 Ballot when much of the claims EDC holds are claims that should be classified under Class 3 of the Plan. EDC further complains that the Plan does not reserve the rights of wrongly classified claimants after confirmation of the Plan, and so without correct classification of its claim, EDC argues it that has no recourse for correcting the deficiency post- confirmation. * Teamsters Pension Fund The Graphic Communications Conference of the International Brotherhood of Teamsters National Pension Fund objects to the confirmation of the Plan on the grounds that the Debtors seek to discharge a statutory liability that has not come into existence, seeks to assume only certain liabilities and obligations of its collective bargaining agreements, and contemplates corporate transactions that will effectively provide a discharge to non- debtors. The Fund asserts that the Plan should not be confirmed unless the Fund's claims of $12,387,147, against the Debtors are treated fairly and equitable as required by Section 1129(b)(2) of the Bankruptcy Code. * GCIU Fund GCIU-Employer Retirement Fund complains that through the proposed substantive consolidation as to distributions under the Plan, the Plan would deprive GCIU Fund of any claims based on control group liability provided under ERISA, without any legal or evidentiary basis. According to GCIU Fund, even assuming substantive consolidation is proper and GCIU Fund has one claim, its claim should be afforded treatment as a Class 3 claim, not a Class 4 claim. Moreover, GCIU Fund argues that the Plan has overly broad discharge provisions and seems to suggest that if the Debtors terminate an employment agreement after the Effective Date, any claims arising under the post-Effective Date termination would be discharged under the Plan. GCIU Fund objects to any purported discharge of any future withdrawal claims and any claims arising from any post-Effective Date termination of its agreements. * Government Agencies The New Jersey Division of Taxation and Department of Labor and Workforce Development assert that the confirmation of the Plan should be denied because the Plan fails to provide adequate treatment of N.J. Taxation's and N.J. Labor's administrative, secured, and priority claims as required under Section 1129(a)(9)(A),(B), and (C). The Louisiana Department of Revenue objects to any provisions of the Plan that are inconsistent with the Stipulation executed that will bring the Debtors into compliance with their postpetition sales tax obligations to Louisiana. Louisiana asserts that the Plan fails to provide for interest on the Administrative and Priority Tax Claims in the event those claims become disputed. Louisiana further asserts that the failure to pay interest or to not pay all the interest on a disputed Administrative or Priority Tax Claim is an impairment because this provision does not leave unaltered Louisiana's legal and equitable rights. Moreover, Louisiana argues that the Debtors cannot demonstrate feasibility of their Plan so long as any taxing authorities' claims remain estimated and unliquidated, absent a Settlement Agreement establishing the amount of the claim. Louisiana further objects to Plan provisions which seek to insulate myriad officers, directors, employees, agents, attorneys and others from liability for their actions in connection with the administration of the Plan or the property to be distributed under the Plan. Louisiana asserts that the Bankruptcy Code provides no authority for this far reaching protection, and it should be stricken from the Plan. The Virginia Department of Taxation asserts that the Plan fails to properly provide for its priority claims, and for requirements of filing of a motion for payment of administrative expense within 60 days of the Effective Date. Virginia argues that requiring it to file a claim for amounts that are unknown will create an unnecessary administrative burden for the Court. * Muller Martini Muller Martini asserts that the Debtors failed to comply with the requirements of Section 1129(b)(2)(A) of the Bankruptcy Code regarding the treatment of secured claims. MCC argues that the Plan does not specifically address the treatment of its secured claims. Therefore, the confirmation of the Plan must be denied, or alternatively, the Debtors must amend or supplement the Plan to include the proposed treatment of MMC's secured claims, MMC asserts. MCC also objects to the vagueness of the language of the Plan that does not address specifically how the Debtors intend to value the machinery they presently possess and the terms of payment on the secured indebtedness. * Individual Claimants Claimants Ewing Daniel Brown, Nicholas Gordon, Herbert Turner, Brian Booker, and Daniel Koo asserts that the Plan is not proposed in good faith and is not in their best interest as it does not make adequate provision for the payment of workers' compensation benefits for work-related injuries the Claimants sustained. * Riverside Claims Riverside Claims, LLC, further objected that the Plan improperly attempts to achieve a deemed consolidation of the Debtors for voting, confirmation and distribution purposes where there is no basis for the consolidation. According to Riverside, the Debtors seek the Court's approval of the concept of "deemed consolidation" for voting, confirmation and distribution purposes. Riverside says the concept of "deemed consolidation" has been viewed as more problematic than a typical substantive consolidation. "While substantive and partial consolidation enjoy general popular use, the same is not true of the 'deemed consolidation,' which has a more recent genesis, less acceptance, an uncertain definition and a more uncertain future," Riverside adds. Riverside relates that the Debtors have not even attempted to outline the facts and circumstances that would allegedly support any substantive or deemed consolidation. Absent of those findings, Riverside maintains that the Plan cannot be confirmed. About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (CA:IQW) -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. The company has operations in Mexico, Brazil, Colombia, Chile, Peru, Argentina, and the British Virgin Islands. Ernst & Young, Inc., the monitor of Quebecor World Inc., and its affiliates' reorganization proceedings under the Canadian Companies' Creditors Arrangement Act, filed a petition under Chapter 15 of the Bankruptcy Code before the U.S. Bankruptcy Court for the Southern District of New York on September 30, 2008, on behalf of QWI (Bankr. S.D.N.Y. Case No. 08-13814). The Chapter 15 case is before Judge James M. Peck. Kenneth P. Coleman, Esq., at Allen & Overy LLP, in New York, serves as counsel to the Chapter 15 petitioner. QWI and certain of its subsidiaries commenced the CCAA proceedings before the Quebec Superior Court (Commercial Division) on January 20, 2008. The following day, 53 of QWI's U.S. subsidiaries, including Quebecor World (USA), Inc., filed petitions under Chapter 11 of the U.S. Bankruptcy Code. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for Chapter 11 bankruptcy before the U.S. Bankruptcy Court for the Southern District of New York (Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP, represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The Company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective January 28, 2008. QWI is the only entity involved in the CCAA proceedings that is not a Debtor in the Chapter 11 Cases. As of June 30, 2008, Quebecor World's unaudited consolidated balance sheet showed total assets of US$3,412,100,000 total liabilities of US$4,326,500,000 preferred shares of US$62,000,000 and total shareholders' deficit of US$976,400,000. Bankruptcy Creditors' Service, Inc., publishes Quebecor World Bankruptcy News. The newsletter tracks the parallel proceedings undertaken by QWI and its affiliates under United States and Canadian bankruptcy laws. (http://bankrupt.com/newsstand/or 215/945-7000) QUEBECOR WORLD: Seeks Continuance of MICP Until 2009 ---------------------------------------------------- Quebecor World (USA) Inc. and its affiliates seek the U.S. Bankruptcy Court for the Southern District of New York's authority to implement and continue the Management Incentive Compensation Plan for the remainder of 2009 and vest certain severance benefits. The Debtors state that the MICP for the second half of 2009 MICP will mirror the Court approved 2008/2009 MICP plan currently in place with these three exceptions: (1) the budgeted consolidated corporate adjusted EBITDA amount for the second half of 2009, plus its cost, must be achieved before any MICP payment is made; (2) eligibility under the MICP for the second half of 2009 is being extended to include certain middle management; and (3) the enhanced portion of the MICP has been eliminated. In addition, there will be one measuring period in respect of the MICP for the second half of 2009, which will be the period July 1, 2009 to December 31, 2009, and awards earned for the second half of 2009 will be payable no later than March 15, 2010. Michael J. Canning, Esq., at Arnold & Porter LLP, in New York, says of the 259 employees eligible to participate in the MICP for the second half of 2009, approximately 147 are employees of the Debtors, while the remaining employees, although MICP eligible, are not employees of the Debtors but are instead employees of the Debtors' corporate parent, Quebecor World, Inc. The bonus that each employee will be eligible for under the MICP for the second half of 2009 is expressed as a percentage of base salary. For a majority of the eligible employees who participated in the 2008/2009 MICP, that percentage of base salary is the same as it was for the January 1 to June 30, 2009 period, notwithstanding adjustments due to promotions or changes in responsibility or reductions due to the Company's recent cost cutting initiatives. The total cost of the MICP for all participants over the 6 month period ending December 31, 2009, will depend on QWI and the Debtors' performance during that period. The maximum cost for all 259 eligible employees is estimated to be approximately $6.3 million. If all employees meet at least the minimum requirement to be eligible for benefits for the entire measurement period, the plan for the second half of 2009 will cost between approximately $2.1 million and approximately $6.3 million, depending on the actual EBITDA achieved, of which between approximately $790,000 and approximately $2.3 million will be payable to employees of the Debtors. The Court will convene a hearing to consider the Motion on June 30, 2009, at 10:00 a.m. (Eastern Time). Objections are due on June 26. About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (CA:IQW) -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. The company has operations in Mexico, Brazil, Colombia, Chile, Peru, Argentina, and the British Virgin Islands. Ernst & Young, Inc., the monitor of Quebecor World Inc., and its affiliates' reorganization proceedings under the Canadian Companies' Creditors Arrangement Act, filed a petition under Chapter 15 of the Bankruptcy Code before the U.S. Bankruptcy Court for the Southern District of New York on September 30, 2008, on behalf of QWI (Bankr. S.D.N.Y. Case No. 08-13814). The Chapter 15 case is before Judge James M. Peck. Kenneth P. Coleman, Esq., at Allen & Overy LLP, in New York, serves as counsel to the Chapter 15 petitioner. QWI and certain of its subsidiaries commenced the CCAA proceedings before the Quebec Superior Court (Commercial Division) on January 20, 2008. The following day, 53 of QWI's U.S. subsidiaries, including Quebecor World (USA), Inc., filed petitions under Chapter 11 of the U.S. Bankruptcy Code. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for Chapter 11 bankruptcy before the U.S. Bankruptcy Court for the Southern District of New York (Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP, represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The Company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective January 28, 2008. QWI is the only entity involved in the CCAA proceedings that is not a Debtor in the Chapter 11 Cases. As of June 30, 2008, Quebecor World's unaudited consolidated balance sheet showed total assets of US$3,412,100,000 total liabilities of US$4,326,500,000 preferred shares of US$62,000,000 and total shareholders' deficit of US$976,400,000. Bankruptcy Creditors' Service, Inc., publishes Quebecor World Bankruptcy News. The newsletter tracks the parallel proceedings undertaken by QWI and its affiliates under United States and Canadian bankruptcy laws. (http://bankrupt.com/newsstand/or 215/945-7000) QUEST RESOURCE: Going Concern Doubt Raised; Warns of Bankruptcy --------------------------------------------------------------- Quest Resource Corporation said the report of UHY LLP, in Houston, Texas, its independent registered public accounting firm, on its financial statements for the fiscal year ended December 31, 2008, includes an explanatory paragraph regarding the Company's ability to continue as a going concern. The factors contributing to this concern include QRCP's recurring losses from operations, stockholders' accumulated deficit, and inability to generate sufficient cash flow to meet its obligations and sustain its operations. QRCP is required to maintain under its Amended and Restated Credit Agreement with Royal Bank of Canada, as administrative agent and collateral agent, as of the end of each quarter, an Interest Coverage Ratio of not less than 2.5 to 1.0 and a Leverage Ratio of no more than 2.0 to 1.0. As a result of the suspension of the distributions to QRCP from Quest Energy and Quest Midstream, QRCP was not in compliance with these financial covenants as of December 31, 2008 and March 31, 2009 and QRCP does not anticipate that it will be in compliance at any time in the foreseeable future. On May 29, 2009, QRCP obtained a waiver of the defaults from its lenders for the quarters ended December 31, 2008 and March 31, 2009. QRCP notes that distributions were suspended on Quest Energy's subordinated units beginning with the third quarter of 2008 and distributions were suspended on all of Quest Energy's units, beginning with the fourth quarter of 2008. Distributions were suspended on all of Quest Midstream's units beginning with the third quarter of 2008. Since the distributions would have been substantially all of QRCP's cash flows for 2009, the loss of the distributions was material to QRCP's financial position. Under the terms of the Credit Agreement, QRCP is required to make quarterly principal payments of $1.5 million. QRCP has prepaid the quarterly principal payments through and including June 30, 2009 and its next quarterly principal payment is due September 30, 2009. QRCP currently does not anticipate being able to make the payment. Under the terms of the Credit Agreement, the outstanding principal amount of borrowings may not exceed the sum of (i) the value of QRCP's oil and gas properties in the Appalachian Basin (as determined by the administrative agent under the Credit Agreement in its reasonable discretion) and (ii) 50% of the market value of QRCP's interests in Quest Energy and Quest Midstream. QRCP is required to make a mandatory prepayment equal to any Collateral Deficiency. On May 29, 2009, QRCP obtained a waiver of this mandatory prepayment for the quarters ended December 31, 2008, March 31, 2009 and June 30, 2009. If a Collateral Deficiency exists after June 30, 2009 that is not waived by QRCP's lender, QRCP will be required to sell assets, issue additional equity securities or refinance the Credit Agreement to cure the deficiency. There can be no assurance that QRCP will be successful in raising sufficient funds to cure the deficiency in the future. In addition, QRCP failed to timely deliver its 2008 audited financial statements to its lender. QRCP has received an extension of this deadline to June 30, 2009. The Company is currently negotiating with its lender to obtain a waiver for future periods. There can be no assurance that QRCP will be able to obtain the waivers. As of December 31, 2008, QRCP had cash and cash equivalents of $4.0 million and no ability to borrow under the terms of the Credit Agreement. QRCP currently estimates that it will not have enough cash to pay its expenses, including capital expenditures and debt service requirements after August 31, 2009. This date could be extended if QRCP is able to restructure its debt obligations, issue equity securities or sell additional assets. If QRCP is not successful in obtaining sufficient additional funds, there is a significant risk that QRCP will be forced to file for bankruptcy protection. At December 31, 2008, the Company reported a net loss of $167,384,000 for year 2008 compared to a net loss, as restated, of $44,154,000 for year 2007. The Company had $650,176,000 in total assets; $96,276,000 in current liabilities, $353,246,000 in long- term liabilities, and $204,536 in minority interests; resulting in $3,882,000 in stockholders' deficit. Quest Gets Waiver Under RBC Facility On May 29, 2009, Quest entered into a Fourth Amendment to Amended and Restated Credit Agreement that, among other things, amended or waived certain of the representations and covenants contained in the Amended and Restated Credit Agreement, as amended, dated as of July 11, 2008, between the Company and Royal Bank of Canada to, among other things: (i) require the Company to deliver to RBC stand alone balance sheets and related statements of income and cash flows for the year ending December 31, 2008 and to file its annual report on Form 10-K for the fiscal year ending December 31, 2008 by no later than June 30, 2009; (ii) allow certain transactions to be effected pursuant to settlement agreements the Company, Quest Energy Partners, L.P. and Quest Midstream Partners, L.P. entered into with their former chief executive officer and related parties; (iii) waive financial covenant (namely the interest coverage ratio and leverage ratio) events of default, for the fiscal quarters ended December 31, 2008 and March 31, 2009; and (iv) waive any mandatory prepayments due to any collateral deficiency during the quarters ended December 31, 2008, March 31, 2009 and June 30, 2009. The Fourth Amendment is among the Company, as borrower, the Company's wholly-owned subsidiaries that have guaranteed the Credit Agreement, and RBC, as administrative agent, collateral agent and a lender. The Company was slated to pay a 1% amendment fee based on the current outstanding principal balance of $28.25 million under the term loan. NASDAQ Listing Update Quest Resource said its management appeared before the NASDAQ Listing Qualifications Hearings Panel on June 11, 2009 and presented the Company's plan to regain compliance with NASDAQ listing requirements and the progress they have made towards this goal, including the filing of QRCP's 2008 Form 10-K. At the hearing, management requested a stay of the delisting of its units from NASDAQ until July 30, 2009, to have sufficient time to file its 2008 Third Quarter Form 10-Q and the 2009 First Quarter Form 10-Q. QRCP expects to receive a written decision from the Panel within 30 days of the hearing date, or by July 10, 2009. The Panel's decision could result in the suspension and delisting of the Company's securities from The NASDAQ Stock Market. About Quest Resource Quest Resource Corporation -- http://www.qrcp.net/ http://www.qelp.netand http://www.qmlp.net/-- is a fully integrated E&P company that owns producing properties and acreage in the Appalachian Basin of the northeastern United States; 100% of the general partner and a 57% limited partner interest in Quest Energy Partners, L.P.; and 85% of the general partner and a 36.4% of the limited partner interests in the form of subordinated units in Quest Midstream Partners, L.P. Quest Resource operates and controls Quest Energy Partners and Quest Midstream Partners through its ownership of their general partners. QVC INC: Moody's Assigns Corporate Family Rating at 'Ba2' --------------------------------------------------------- Moody's Investors Service assigned QVC, Inc. a Ba2 Corporate Family Rating and Ba3 Probability of Default Rating, as well as a Ba2 rating and LGD3 -- 35% assessment to QVC's proposed $500 million term loan B and existing $3 billion March 2006 credit facility. These are first-time ratings assigned in conjunction with the term loan B offering whose proceeds will be used to repay a portion of QVC's existing credit facilities. The rating outlook is stable. Assignments: Issuer: QVC, Inc. -- Corporate Family Rating, Assigned Ba2 -- Probability of Default Rating, Assigned Ba3 -- $500 million Senior Secured Term Loan B, Assigned Ba2, LGD3 - 35% -- $3.0 billion Senior Secured Bank Credit Facility, Assigned Ba2, LGD3 - 35% (facility size to be reduced upon completion of the Term Loan B offering) Outlook Actions: Issuer: QVC, Inc. -- Outlook, Assigned Stable QVC's Ba2 CFR is based on the good operating margins and cash flow generated from its leading global position in television-based retailing. Moody's views the product offerings as largely discretionary and vulnerable to downturns in consumer spending. Moody's believes that the recent $750 million pay down along with debt reduction from required repayments will help to partially mitigate expected declines in EBITDA resulting from the current deep global consumer-led recession. The Ba2 CFR reflects QVC's stand-alone credit profile adjusted for the effects of ownership by Liberty Media LLC (Ba2 CFR, on review for downgrade). Liberty is currently targeting a relatively low 2x debt-to-EBITDA leverage level for QVC (excluding Moody's adjustments). However, Moody's believe Liberty will pursue a more aggressive financial policy over the intermediate- to long-term and that Liberty will primarily utilize dividends from QVC to fund debt service attributable to the Liberty Interactive tracking stock. These factors constrain QVC's ratings, resulting in a Ba2 CFR that incorporates an approximate one notch downward adjustment relative to QVC's stand-alone credit profile. The stable rating outlook reflects Moody's expectation that debt- to-EBITDA leverage (approximately 3.3x LTM March 2009 incorporating Moody's standard adjustments and factoring in the $750 million repayment in June 2009) will remain in a 3.0x - 4.0x range over the next 12 to 18 months. The rating outlook also reflects QVC's reasonably good liquidity position driven by a sizable cash balance (approximately $584 million as of 3/31/09), expected free cash flow generation of approximately $220 million over the next 12 months (after factoring in distributions to fund LINTA debt service and minority interest dividends), and a moderate covenant cushion. Moody's expects the cash and free cash flow will be sufficient to fund the $505 million of required term loan payments through June 2010, but anticipates QVC will need to obtain incremental funding to meet required debt payments in the second half of 2011. The assignment of ratings to QVC does not affect the ongoing review for downgrade of Liberty related to its proposed spin-off of the majority of the Liberty Entertainment group assets. Moody's does not expect the spin-off to affect the ratings assigned to QVC. The term loan B is structured as an incremental borrowing under QVC's March 2006 credit agreement and the facilities, along with the facilities issued under the October 2006 credit agreement, will be secured by all personal property of QVC and material restricted subsidiaries other than deposit accounts, equipment and fixtures. The aggregate commitments under the March 2006 and October 2006 credit facilities including the term loan B will be $4.5 billion and reflect a $750 million repayment funded from $250 million of existing cash held by QVC and $500 million by Liberty upon the June 16, 2009 closing of the amendment and restatements of QVC's credit facilities. The one notch differential between the CFR and the Ba3 PDR reflects the use of an above average 65% family recovery rate for all bank-debt structures in accordance with Moody's loss-given default methodology. Moody's subscribers can find further details in QVC's credit opinion published on www.moodys.com. QVC, headquartered in West Chester, Pennsylvania, is one of the largest multimedia retailers in the world primarily targeting female shoppers with a mix of beauty, fashion, jewelry and home products. QVC was founded in 1986 and has operations in the U.S., United Kingdom, Germany and Japan with plans to expand into Italy in 2010. The company is a wholly owned subsidiary of Liberty Media Corp. and attributed to the LINTA tracking stock. Annual revenue is approximately $7.1 billion. R3 FOOD: Sale Hearing on June 29 & Claims Due by Sept. 30 --------------------------------------------------------- On June 2, 2009, the Philadelphia Court of Common Pleas entered an order in a lawsuit styled General Electric Capital Business Asset Funding Corporation of Connecticut v. R3 Food Services, LLC (Sept. Term 2008, Civil Action No. 01661), requiring all persons or entities having claims or demands against R3 Food Services to file a claim on or before September 30, 2009. Proofs of Claim and all documentation supporting the claim must be delivered to: Mr. Kevin O'Halloran Receiver for R3 Food Services, LLC P.O. Box 56584 Atlanta, GA 30343 so as to be received by the Receiver on or before the Bar Date. E-mail and facsimile submissions will not be accepted. Proofs of Claim shall be deemed filed when actually received by the Receiver. Failure to timely submit a Proof of Claim may result in having your claim disallowed by the Court. The Receiver shall retain the right to: (i) dispute, or assert offsets, defenses or counterclaims against any filed Proof of Claim as to nature, amount, liability, classification, or otherwise; (ii) subsequently designate any Proof of Claim as disputed, contingent or unliquidated; and (iii) withhold distributions, if any are available, to the affected creditor until such time as the dispute is resolved by agreement with the Receiver or by the Court, subject to an appeal by any aggrieved party contesting the Receiver's determination. Persons or entities holding the following claims are not required to file a Proof of Claim: (1) any claim against the Defendant previously allowed by or paid pursuant to an order of the Court; or (2) any claim of the professionals, vendors and contractors employed by the Receiver (which shall remain subject to a separate application and allowance process). No participating creditor shall execute on any Receivership asset. If you believe that you have a claim against the Defendant and require a Proof of Claim form, please contact the Receiver's counsel: Mark J. Dorval, Esq. Stradley Ronon Stevens & Young, LLP 2600 One Commerce Square Philadelphia, PA 19103 Telephone (215) 564-8000. R3 Food Services, LLC, operates franchised Taco Bell(R) restaurants located in Pennsylvania and Ohio. Subject to higher and better offers, the Receiver has entered into an asset purchase agreement with Charter Foods North, LLC, for the sale of the Stores free and clear of all liens. A hearing to approve the sale to the highest bidder is scheduled for June 29, 2009, at 10:00 a.m., in Philadelphia, before the Honorable Mark I. Bernstein. RAP VENTURES: Case Summary & 6 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: RAP Ventures, Inc. dba Ramada Inn 5005 34th Street North Saint Petersburg, FL 33704 Bankruptcy Case No.: 09-13069 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Middle District of Florida (Tampa) Debtor's Counsel: Thomas C. Little, Esq. 2123 N.E. Coachman Road, Suite A Clearwater, FL 33765 Tel: (727) 443-5773 Email: janet@thomasclittle.com Total Assets: $6,452,299 Total Debts: $3,964,352 A full-text copy of the Debtor's petition, including a list of its 6 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flmb09-13069.pdf The petition was signed by Ram A. Prasad, president of the Company. REAL MEX: Moody's Assigns 'B3' Rating on Senior Secured Notes ------------------------------------------------------------- Moody's Investors Service assigned a provisional (P)B3 rating to the proposed 2nd lien senior secured notes issuance by Real Mex Restaurants, Inc. The company intends to apply most of the proceeds from the $110 million offering to repay its existing $105 million 2nd lien senior secured notes that will mature in April 2010. Concurrently, Moody's affirmed Real Mex's Corporate Family Rating and Probability of Default rating at Caa2, while revising the rating outlook to developing from negative. The developing outlook reflects the likely improvement in liquidity and reduction in near term default risk if the refinancing is consummated. The provisional (P) indicator on the new notes will be removed and a B3 rating will be assigned, upon closing of the transaction and Moody's satisfactory review of final documentation. Real Mex's rating outlook and Speculative Grade Liquidity rating, currently at SGL-4, will be revisited at the same time. Conversely, if the transaction does not transpire as proposed, Real Mex's ratings will likely face significant downward pressure engendered from the mounting refinancing risk. While recognizing the potential benefit on liquidity after refinancing, the Caa2 CFR continues to reflect the challenges Real Mex will face to reverse its revenue decline primarily driven by the worsening negative same store sales trend, in a very difficult operating environment for casual dining concepts. Its SSS stood at -9.1% in the first quarter 2009 as compared to -7.2% in the fourth quarter 2008, largely reflecting slower guest traffic at its restaurants. Moody's expects Real Mex's topline will likely continue to be under pressure in the medium term, in light of the prolonged recession and aggravating economic conditions in California, where the unemployment rate and foreclosure are among the highest in the nation and more than 80% of Real Mex's restaurants are located. Therefore, its credit metrics will likely remain weak throughout the intermediate term. "Intensified competition in the casual dining sector and consumers' trading down to less expensive alterative dining places, such as quick service and fast-casual restaurants, would further dampen Real Mex's effort in turning around the negative traffic trend," commented Moody's analyst John Zhao. Favorably, the rating incorporates the management's experience and continuous effort in managing operating margin. In addition, Real Mex's focus on providing authentic Mexican-themed casual dining experience and its leading position in this niche should bode well with the long-term demographic trend, such as the rapid growth of Hispanic population in the U.S. Moody's anticipates that, concurrent with the refinancing, the $40 million 1st lien senior secured credit facilities due January 2010 (not rated) would be extended by 3 years with new maturity date in June 2012 through a credit agreement amendment with its senior lender, and financial covenants under the facilities would be loosened to allow ample cushion for compliance in the future. In addition, the current maturity on the $65 million senior unsecured term loan due October 2010 (not rated) would also be extended beyond 2012, $25 million of which would be moved to Real Mex's holding company, among other changes. The ratings on the existing $105 million senior secured notes due 2010 were lowered to B3 from B2, due to lower family recovery assumption per Moody's Loss-given-Default methodology, given the deteriorated core operating performance. The rating action is: Rating assigned: -- $110 million 2nd lien senior secured notes due 2012 - (P) B3 (LGD2, 26%) Ratings affirmed: * Corporate Family Rating -- at Caa2 * Probability of Default Rating -- at Caa2 * Speculative Grade Liquidity rating -- at SGL-4 Rating changed: * $105 million 2nd lien senior secured notes due 2010 -- lowered to B3 (LGD2, 26%) from B2(LGD2, 20%) * Rating outlook: changed from negative to developing The last rating action on Real Mex occurred on November 24, 2008 when its CFR was upgraded to Caa2 from Caa3 after the completion of balance sheet restructuring. Real Mex Restaurants, Inc., headquartered in Cypress, California, is a leading Mexican-themed restaurant chain operator that owns, operates and franchises casual dining restaurants primarily under the El Torito, Chevys Fresh Mex and Acapulco Mexican Restaurant concepts. At March 29, 2009, Real Mex operated 224 restaurants of which 155 were located in California and the remainder were located in 12 other states. Total revenues for twelve months ending March 29, 2009, were approximately $545 million. ROBERT ORR: Albert Reidere Seeks to Block Bankruptcy Protection --------------------------------------------------------------- Kansas City Business Journal reports that Albert Riederer, the Chapter 11 trustee of the Brooke Corp. and Brooke Capital Corp., has sought to block former Brooke Corp. founder and CEO Robert Orr's filing for bankruptcy protection. According to Business Journal, Mr. Reiderer is accusing Mr. Orr of transferring about $4 million from various Brooke accounts to Brooke Holdings, "with the intent of enriching Orr, his other family members and/or trusts which were set up with Orr and/or his family members as beneficiaries." Mr. Orr transferred the $4 million at a time when he knew that the Brooke companies wouldn't be able to sustain their business operations for any significant period of time, Business Journal says, citing Mr. Riederer. Business Journal relates that Mr. Reider claims that during 2008 or earlier, Mr. Orr diverted $14 million of revenue from Brooke companies to pay for the debt obligations of franchisees, in order to hide the true financial condition of the Brooke companies from creditors. The report quoted Mr. Reider as saying, "Orr's actions in doing so constituted a breach of his fiduciary obligations because he was directing that the (Brooke companies) pay obligations for which the (Brooke companies) were not liable." Mr. Reider alleges that under the direction of Mr. Orr, the Brooke companies diverted some $4 million from accounts that held the insurance premiums paid by insurers to cover an overdraft that the Brooke companies had at wholly owned subsidiary Generations Bank, Business Journal states. Phillipsburg, Kansas-based Robert Dean Orr filed for Chapter 11 bankruptcy protection on December 16, 2008 (Bankruptcy D. Kan. Case No. 08-13242). J. Michael Morris, Esq., who has an office in Wichita, Kansas, assists Mr. Orr in his reorganization efforts. The Debtor listed $100,000 to $500,000 in assets and $50,000,000 to $100,000,000 in debts. SEARS CANADA: Moody's Downgrades Senior Unsecured Notes to 'Ba1' ---------------------------------------------------------------- Moody's Investors Service lowered Sears Canada's senior unsecured notes to Ba1 from Baa3. The company's Ba1 Corporate Family Rating and SGL-2 Speculative Grade Liquidity rating were affirmed. The outlook remains stable. The downgrade of Sears Canada's senior unsecured notes results from the release of collateral in connection with the maturity of the company's revolving credit facility. Following re-application of Moody's Loss Given Default methodology for the released collateral, the bonds were downgraded one notch. The Ba1 Corporate Family Rating recognizes Sears Canada's solid franchise and strong credit metrics. Debt/EBITDA remains below 3 times even after the inclusion of soft first quarter 2009 results in the LTM period. Key concerns include the potential impact on financial policy decisions that could be made by its ultimate 74% owner, Sears Holdings. The stable outlook reflects that though operating results have softened due to the weakening macroeconomic environment, there still remains sufficient cushion in key credit metrics. The SGL-2 Speculative Grade Liquidity rating, representing good liquidity, recognizes that while Sears Canada does not have a committed bank revolver, it does have healthy cash balances and is generating significant levels of operating cash flow. Rating lowered: -- Senior unsecured notes to Ba1 (LGD 3, 41%) from Baa3 Ratings affirmed: -- Corporate Family Rating at Ba1 -- Probability of Default Rating at Ba1 -- SGL-2 Speculative Grade Liquidity rating The last rating action for Sears Canada was the December 18, 2007 upgrade to SGL-2 of the Speculative Grade Liquidity rating. Sears Canada, Inc., operates 388 stores throughout Canada, as well as approximately 1,800 catalog outlets, with annual revenues of around $6 billion. Sears Canada is 74% owned by Sears, Roebuck and Co., which is a wholly-owned subsidiary of Sears Holdings. SHERIDAN GROUP: S&P Affirms Corporate Credit Rating at 'B' ---------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on The Sheridan Group Inc. The rating was removed from CreditWatch, where it was placed with negative implications on May 20, 2009. The rating outlook is stable. At the same time, Standard & Poor's affirmed its 'B' issue-level rating on Sheridan's 10.25% senior secured notes due 2011 and removed it from CreditWatch. S&P revised its recovery rating on the notes to '3', indicating S&P's expectation of meaningful (50% to 70%) recovery for noteholders in the event of a payment default, from '4', primarily reflecting the company's reduction in its revolver commitment to $20 million from $30 million. (See Standard & Poor's recovery report on Sheridan, to be published on RatingsDirect immediately following the release of this report.) "The rating actions follow Sheridan's successful execution of a $20 million amended and restated revolving credit agreement, which alleviates some of our concerns regarding its near-term liquidity profile," said Standard & Poor's credit analyst Ariel Silverberg. The new facility matures March 25, 2011, and contains a $33 million minimum EBITDA covenant and a 1.80x interest coverage covenant. While S&P remain concerned that the weak operating environment will continue to pressure earnings, and S&P expects that EBITDA will fall in the low- to mid-teens percentage area in 2009, resulting in leverage of around 5.0x, S&P does not expect this will result in a covenant violation in the next several quarters. S&P's expectation for 2009 performance stems from S&P's assumption that Sheridan will continue to experience volume declines across all of its segments, including books and journals, resulting in a low- to mid-teens percentage revenue decline. At March 31, 2009, adjusted debt to EBITDA was 4.3x, and EBITDA coverage of interest was 2.1x. The 'B' rating reflects challenging operating conditions across Sheridan's niche printing segments, the expectation for declining EBITDA in 2009, and the expectation for an aggressive financial profile, with debt leverage of around 5.0x. In the first quarter of 2009, revenue and EBITDA declined 17% and 14%, respectively, as compared to the first quarter of 2008. Adjusting for pass-through costs (paper and freight), first- quarter revenues declined 11% year over year. The declines reflect reduced volume across all segments, with the greatest weakness in magazines and specialty catalogs. S&P expects the operating environment in the print industry to remain weak through 2009, in part due to customers' reduction of ad spend, as well as a continued reduction in discretionary spending, which particularly affects magazine and catalog volume. The secular shift away from print media is another negative operating factor. SILVER CLUB: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Silver Club 1040 Victorian Ave. Sparks, NV 89431 Bankruptcy Case No.: 09-51953 Debtor-affiliates filing separate Chapter 11 petitions: Entity Case No. ------ -------- Parker's Model T., Inc. 09-51956 The Holder Group El Capitan, Inc. 09-51958 The Holder Group Elko, LLC 09-51961 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of Nevada (Reno) Judge: Gregg W. Zive Debtor's Counsel: Stephen R. Harris, Esq. Belding, Harris & Petroni, Ltd 417 W Plumb Ln Reno, NV 89509 Tel: (775) 786-7600 Fax: (775) 786-7764 Email: steve@renolaw.biz Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/nvb09-51953.pdf The petition was signed by Harold D. Holder, Sr., president of the Company. SINCLAIR BROADCAST: S&P Downgrades Corporate Credit Rating to 'B+' ------------------------------------------------------------------ On June 19, 2009, Standard & Poor's Ratings Services lowered its corporate credit and issue-level ratings on Hunt Valley, Maryland- based TV broadcaster Sinclair Broadcast Group Inc. and subsidiary Sinclair Television Group Inc. by one notch. The corporate credit rating was lowered to 'B+' from 'BB-', and the rating outlook is negative. "The ratings downgrade reflects our view that because of the very weak advertising market for local TV broadcasters, Sinclair's debt leverage will rise rapidly in 2009, with no imminent prospect of improvement," said Standard & Poor's credit analyst Deborah Kinzer. The 'B+' rating reflects the company's financial risk from high debt leverage, its portfolio of generally lower-ranked stations, its growing portfolio of real estate and other non-TV assets, and the refinancing risk that the company faces in 2010 and early 2011, when investors can exercise put options on about $438 million of convertible debt. Sinclair has one of the largest non-network owned TV station groups in the U.S., reaching about 22% of the country's households. The company's size confers synergies with respect to marketing, programming, overhead, and capital expenditures. Sinclair operates 58 stations in 35 markets, primarily in the Eastern half of the country, which provides some measure over business diversification. Most of Sinclair's stations are affiliated with the Fox (20 stations), MyNetworkTV (17), ABC (9), or CW (9) networks; this has not been an optimal mix in recent periods, with all but the Fox stations underperforming. Over the past two years, the company has spent more than $180 million to purchase non-TV assets, including several real estate investments. S&P views the strategic and long-term commercial values of these investments as unclear, and the businesses as unrelated to Sinclair's core competencies. The company funded these acquisitions partially with debt. Investments in noncore assets that increase debt leverage are a negative rating factor. Leverage remains a key rating concern. The company has high debt leverage because of past debt-financed acquisitions and nonstrategic investments and high dividend payments, combined with the current weakness in revenues. As of March 31, 2009, lease- adjusted debt to EBITDA was 6.3x. Despite modest debt repurchases by the company in the first quarter of 2009, S&P does not expect Sinclair to be able to reduce its leverage below S&P's threshold ratio of 6.0x for a 'BB-' rating in the foreseeable future. Moreover, in S&P's opinion, the company's leverage could rise well above 7.0x as 2009 progresses. Lease-adjusted EBITDA coverage of interest expense was 2.6x (pro forma for a full year's impact of APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash Upon Conversion) for the 12 months ending March 31, 2009. S&P expects interest coverage to narrow in 2009 and thereafter because of lower EBITDA and the likelihood that any debt issued to refinance the convertible issues will be more costly. Sinclair converted about 45% of EBITDA into discretionary cash flow in the 12 months ending March 31, 2009, compared with 37.7% in the same period of 2008. Dividends were very high, at about 31% of EBITDA in the 12 months ending March 31, 2009. Although the company recently suspended the dividend and plans to curtail its capital spending, S&P expects discretionary cash flow to be insufficient to enable significant debt reduction in 2009. SIRVA INC: To Settle Multidistrict Litigation for $3 Million ------------------------------------------------------------ Sirva Inc. and three affiliates have received court approval to pay $3 million to settle multidistrict litigation accusing them of price-fixing fuel surcharges, according to Law360. The company and 61 of its affiliates filed separate petitions for Chapter 11 protection on February 5, 2008 (Bankr. S.D.N.Y. Case No. 08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis, L.L.P. is representing the Debtor. When the Debtors filed for bankruptcy, it reported total assets of US$924,457,299 and total debts of US$1,232,566,813 for the quarter ended Sept. 30, 2007. The Court confirmed the Debtor's First Amended Prepackaged Plan on May 7, 2008. The Debtors' First Amended Prepackaged Joint Plan of Reorganization became effective on May 12, 2008. SOLO CUP: Moody's Assigns 'Ba2' Rating on New Asset-Based Revolver ------------------------------------------------------------------ Moody's Investors Service assigned a Ba2 rating to the new asset- based revolver and a B2 rating to the new senior secured notes of Solo Cup Company. Moody's also affirmed the B3 corporate family rating and stable rating outlook. Additional instrument ratings are detailed below. The rating is in response to the company's announcement on June 19, 2009 that it plans to offer $300 million of senior secured notes due 2013. The proceeds from the offering, together with proceeds from an anticipated concurrent bank financing, are expected to be used to repay all amounts outstanding under the Company's existing first lien credit agreement and to pay the fees, expenses and other costs relating to the offering and the bank financing. The bank financing includes a proposed $200 million asset-based revolving credit facility. Ratings on the existing credit facilities and the term loan will be withdrawn after completion of the transaction. Moody's believes the transaction is largely credit neutral given the use of proceeds. The transaction will bolster liquidity, address near-term maturities and improve covenant cushion, but higher interest rates on the new debt will erode interest coverage in the absence of further margin improvements. Solo Cup's credit metrics are strong for the rating category, but its operating performance has declined over the last two quarters. The company has been negatively impacted by economic weakness and a challenging competitive environment. Moody's believes the company's competitive position is still evolving and a sustained improvement in credit metrics over the rating horizon may prove challenging despite the significant performance improvement initiatives undertaken. This is incorporated in the company's B3 corporate family rating, which also reflects Solo Cup's concentration of sales, the risks inherent in the company's plan to exit certain business and the lack of long term contracts for a high percentage of business. The ratings are supported by the company's ongoing performance improvement initiatives, broad product portfolio and long-standing customer relationships. The ratings are also supported by Solo Cup's strong liquidity and anticipated cash flow from pending real estate sales. Moody's took these rating actions: -- Affirmed Corporate Family Rating at B3 -- Affirmed Probability of Default Rating at B3 -- Affirmed $150 million senior secured revolving credit facility dur 2010, B2 (LGD 3, 35%) (to be withdrawn upon completion of the transaction) -- Affirmed $637 million senior secured term loan B due 2011 ($302 million outstanding), B2 (LGD 3, 35%) (to be withdrawn upon completion of the transaction) -- Affirmed $323 million senior subordinated notes due 2014, Caa2 (LGD 5, 87% ) -- Affirmed speculative grade liquidity rating of SGL-2 -- Assigned $200 million asset-based revolver due 2013, Ba2 (LGD 2, 13%) -- Assigned $300 million senior secured notes due 2013, B2 (LGD3, 43%) The rating outlook is stable. Moody's last rating action on Solo Cup occurred on July 24, 2008, when Moody's affirmed the company's B3 corporate family rating and rating outlook and assigned an SGL-2 speculative grade liquidity rating. Headquartered in Highland Park, Illinois, Solo Cup Company is one of the largest domestic manufacturers of disposable paper and plastic food and beverage containers used in the foodservice and retail consumer markets. Products include cups, lids, straws, napkins, cutlery, and plates. Revenues were approximately $1.8 billion for the twelve months ended March 31, 2009. SONORAN ENERGY: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Sonoran Energy, Inc. fdba Barron Oil fdba Scottsdale Oil Field Services fdba ShowsforOnline.com fdba Washington, Inc. 15305 Dallas Parkway, Ste 300 Addison, TX 75001 Bankruptcy Case No.: 09-33852 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Harlin DeWayne Hale Debtor's Counsel: Margaret Hall, Esq. Sonnenschein, Nath & Rosenthal, LLP 2000 McKinney Ave., Ste 1900 Dallas, TX 75201 Tel: (214) 259-0900 Total Assets: $47,067,773 Total Debts: $26,415,250 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/txnb09-33852.pdf The petition was signed by Michael L. Kayman, chief restructuring officer of the Company. SPANSION INC: Seeks to Reject Contract with Market Street --------------------------------------------------------- On March 17, 2008, Spansion LLC and Market Street Partners LLC entered into an agreement pursuant to which Market Street Partners provides investment community consulting and investor relations and advice with respect to financial community relations, shareholder relations and related matters. Spansion has historically employed the services of Market for quarterly earnings calls and similar events. Pursuant to the terms of the Agreement, Spansion makes monthly payments of approximately $12,000 for the services provided by Market Street Partners. The Agreement initially had a one-year term that expired on March 16, 2009. The Debtors tell the Court that after the initial year, the Agreement continues perpetually, provided, however, that either party may terminate the Agreement upon 60 days notice. The Debtors note that they have determined that the Agreement is no longer in the best interest of their estates and should be rejected. The Debtors relate that through their restructuring efforts, the services provided by Market Street under the Agreement are now performed by their employees. Accordingly, the Debtors seek the Court's authority to reject, nunc pro tunc to June 5, 2009, the Agreement, in accordance with Section 365 of the Bankruptcy Code. The Debtors further ask the Court to direct that claims for damages arising as a result of the rejection of the Agreement must be filed by the date that is fixed by the Court as the claims bar date in the Debtors' Chapter 11 cases. About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. SPANSION INC: Seeks Approval of UBS Bank USA Settlement ------------------------------------------------------- In connection with certain settlements with U.S. security regulators and certain state Attorneys General regarding UBS Bank USA, UBS Financial Services Inc., UBS Securities LLC, and UBS AG's sale and marketing of auction rate securities, UBS offered certain rights to eligible holders of auction rate securities. Spansion Inc., an Eligible Holder, accepted the offer and received rights denominated as "Series C-1 and C-2" Rights. The Series C- 1 and C-2 Rights held by Spansion entitle it to require UBS to purchase the Spansion ARS at par value during the period commencing on June 30, 2010, and ending on July 2, 2012. The aggregate Par Value of all the Spansion ARS is $121,900,000. Also prior to the Petition Date, Spansion was, and continues to be, the account holder of a certain securities account at UBS, which account consists primarily of Spansion ARS and any interest, dividends, distributions and other proceeds of the Spansion ARS. In connection with the Offer, Spansion applied for, and obtained from UBS Bank USA, an uncommitted revolving line of credit by executing: (i) a Credit Line Agreement; (ii) a Credit Line Account Application and Agreement; (iii) a Borrower Agreement; and (iv) an Addendum to Credit Line Account Application and Agreement. To secure the Credit Line and all obligations, Spansion granted UBS Bank USA, a first priority lien in, among other things, the Collateral Account, the Spansion ARS and the Proceeds. UBS Bank USA asserts, and the Debtors admit, that UBS Bank USA has properly perfected its priority lien in the Collateral. Pursuant to the terms of the Credit Line Documents, any and all Proceeds are automatically swept out of the Collateral Account and into the Credit Line Account in the ordinary course of business, and applied by UBS Bank USA to the Credit Lien to satisfy Spansion's obligations in accordance with the terms of the Credit Line Documents. The Debtors tell the U.S. Bankruptcy Court for the District of Delaware that as of February 27, 2009, (i) the amount outstanding under the Credit Line was $79,354,393 and (ii) the market value of the Spansion ARS was approximately $104,078,330. Pursuant to the Credit Line Documents, Spansion granted UBS the sole discretion and right to sell, redeem or dispose of, or enter orders in the auction process with respect to the Spansion ARS without prior notification -- the "Call Right. Upon exercise of the Call Right, the proceeds of a sale, redemption or other disposition of the affected Spansion ARS are to be applied first to Spansion's obligations under the Credit Line, upon full satisfaction of all obligations are to be surrendered to the Debtors. In the event that the Disposition Proceeds are less than the Par Value of the ARS sold, redeemed or disposed of, UBS must pay the difference by way of a payment which is applied concurrently with, and in the same manner as, the Disposition Proceeds. By this motion, the Debtors ask the Court to approve their stipulation with UBS, pursuant to Rule 4001(d) of the Federal Rules of Bankruptcy Procedure. The Stipulation provides that UBS be authorized to take these actions without violating the automatic stay: (a) Receive proceeds as they accrue to the Spansion ARS in the Collateral Account, transfer them to UBS Bank USA or a successor, and apply them to the Credit Line in pro tanto satisfaction of Spansion's obligations, or in the event that no obligations under the Credit Line remain outstanding, pay all further Proceeds to the Debtors. In applying any proceeds, UBS Bank USA or a successor will be permitted to apply those amounts to postpetition interest accruing on the credit line, provided it is not subsequently determined that UBS Bank USA is not oversecured; (b) Exercise the Call Right with respect to any of the Spansion ARS, provided that the Debtors will receive an amount equal to the Par Value of the Spansion ARS redeemed, sold or otherwise disposed of, consisting of the Disposition Proceeds plus the Shortfall Payment, and only upon proper notice as provided in the Stipulation; (c) Apply the Disposition Proceeds and the Shortfall Payment in satisfaction of obligations under the Credit Line, with any excess amounts being paid to the Debtors. "Allowing the practice to go forward in the form that was followed prepetition allows the Debtors to reduce the obligations under the Credit Line and therefore reduce accruing interest, which is beneficial to the Debtors' estates.," Sommer L. Ross, Esq., at Duane Morris, LLP, in Wilmington, Delaware, relates. About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. SPANSION INC: Samsung Wants Stay Lifted for Suit to Continue ------------------------------------------------------------ Samsung Electronics, Ltd., asks the U.S. Bankruptcy Court for the District of Delaware to lift the automatic stay so it could proceed with its claims and counterclaims against Spansion, LLC, in a patent litigations commenced by Spansion against it. In November 2008, the Debtors commenced patent litigation infringement against Samsung in the U.S. District Court for the District of Delaware and with the Intellectual Trade Commission for alleged patent violations relating to Flash memory. The complaint in the ITC Action sought exclusion from the United States market of Samsung's flash memory alleging that this memory infringes four of the Debtors' flash-memory related patents. The complaint in the ITC Action also seeks exclusion from the United States market of mp3 players, cell phones, digital cameras, and other consumer electronic devices containing the allegedly infringing Samsung flash memory. In the Delaware Action, the Debtors sought both an injunction and damages for alleged patent violations relating to Samsung flash memory. Spansion asserted six patents in the Delaware Action, all of which are different from the ITC Action. In January 2009, Samsung commenced patent infringement actions against the Debtors' Japanese subsidiary, Spansion Japan Limited, in Tokyo District Court seeking an injunction against Spansion Japan from manufacturing and selling certain products that allegedly infringe Samsung's intellectual property, as well as the destruction of all those products. Samsung also filed an answer and counterclaims against the Debtors in the Delaware Action. The Delaware Action counterclaims alleged that the Debtors are infringing five Samsung patents, and sought an injunction and damages for those alleged violations. However, the Delaware Action has not progressed beyond the answer stage and has been stayed by agreement of the parties since March 31, 2009. To recall, the Debtors had asked the U.S. Bankruptcy Court for the District of Delaware to approve their settlement with Samsung, which provides, among other things, for Samsung to pay the Debtors $70,000,000. On June 2, 2009, Judge Carey denied the Settlement. In light of the denial of the Settlement, the Debtors have indicated that they wish to resume their pending litigation. Samsung clarifies that it does not oppose resuming the pending litigation but for the sake of efficiency, it seeks relief from the stay to proceed with its related prepetition counterclaims against the Debtors. "Given the specialized nature of the patent disputes and the strong policy considerations favoring complete resolution of the issues, cause exist to grant Samsung relief from the automatic stay with respect to the Prepetition Counterclaims," asserts Sally E. Veghte, Esq., at Klehr, Harrison, Harvey, Branzburg & Ellers LLP, in Wilmington, Delaware, counsel for Samsung Electronics Co., Ltd. She adds that proceeding with the Prepetition Counterclaims would not prejudice the Debtors because the Prepetition Counterclaims would not interfere with the administration of the Debtors' estates. In an e-mailed statement sent to EE Times, Spansion spokesperson said the Company does not anticipate that the Samsung patent litigation will affect its restructuring progress. The spokesperson added that Spansion has always excluded any potential proceeds from the settlement in its current cash balance statements. About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. SPANSION INC: Mathers Requests for Equity Holders Committee ----------------------------------------------------------- Philip Mathers, a party-in-interest and equity security holder of 2,000,000 class A common stock of Spansion Inc., asks the U.S. Bankruptcy Court for the District of Delaware to appoint an Official Committee of Equity Security Holders to assure a timely and appropriate representation of equity security holders and the orderly and proper administration of the estate. Dr. Mathers asserts that the Equity Holders will not have representation in the Debtors' case absent an official committee. He adds that the current and sustained depression in the stock price, and the decision of many equity holders to bail out already, is no excuse to bypass, abuse or take-for-granted those who lawfully own the company. In Court papers, Dr. Mathers says "The Note-holders are represented before this Court. The equity security holders are not. In short, it is impossible, from the outside without representation, for the equity security holders to ascertain anything meaningful from the data which the Debtors are reporting." Dr. Mather is referring to the alleged inconsistencies of the data contained in the monthly operating reports and other reports filed by the Debtors with the Court. Specifically, from the equity security holders' viewpoint, most alarming is the sudden announcement of an unexplained and unprecedented depreciation of some $2.76 billion in assets. "And if the Debtors themselves are incompetent with respect to their accounting, how do they know themselves that they are insolvent and/or in need of protection, as they clam?" Dr. Mathers points out. According to Dr. Mathers, further evidence of the Debtors' indifference to their equity holders is the proposed litigation with Samsung Electronics, Ltd., which the Court had denied approval. "Equity security holders have waited patiently for the Debtors to deliver promised reports, only to be handed additional extensions to deadline and an enormous retrospective asset write-down," Dr. Mathers says. "The time to appoint an official committee of equity security holders has come." About Spansion Inc. Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com/-- is a Flash memory solutions provider, dedicated to enabling, storing and protecting digital content in wireless, automotive, networking and consumer electronics applications. Spansion, previously a joint venture of AMD and Fujitsu, is the largest company in the world dedicated exclusively to designing, developing, manufacturing, marketing, selling and licensing Flash memory solutions. Spansion Inc., Spansion LLC, Spansion Technology LLC, Spansion International, Inc., and Cerium Laboratories LLC filed voluntary petitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-10690). On February 9, 2009, Spansion's Japanese subsidiary, Spansion Japan Ltd., voluntarily entered into a proceeding under the Corporate Reorganization Law (Kaisha Kosei Ho) of Japan to obtain protection from its creditors as part of the company's restructuring efforts. None of Spansion's subsidiaries in countries other than the United States and Japan are included in the U.S. or Japan filings. Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions LLC, is the claims agent. The United States Trustee has appointed an official committee of unsecured creditors in the case. As of September 30, 2008, Spansion disclosed total assets of US$3,840,000,000, and total debts of US$2,398,000,000. Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009 (Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner's counsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It said that Spansion Japan had US$10 million to US$50 million in assets and US$50 million to US$100 million in debts. SPARTON CORPORATION: National City Note Extended to August 15 ------------------------------------------------------------- Sparton Corporation entered into a Modification Agreement with National City Bank, a national banking association, which amends the terms of the existing Promissory Note dated January 22, 2008, between the Company and the Lender, as amended and the related documents. The Promissory Note relates to an $18 million revolving line of credit facility that supports the Company's working capital needs and other general corporate purposes. The Line of Credit Loan is secured by substantially all assets of the Company. The Line of Credit Loan is evidenced by, among other documents, the Promissory Note, as amended by the Master Amendment to Loan Documents, dated as of April 21, 2008, and effective as of March 31, 2008, by the Second Master Amendment to Loan Documents, dated as of July 31, 2008 and effective as of June 30, 2008, by the Third Master Amendment to Loan Documents, dated as of November 12, 2008, by the Fourth Master Amendment to Loan Documents, dated as of January 20, 2009 and by the Promissory Note Modification Agreement dated April 30, 2009, and effective May 1, 2009. Pursuant to the Amendment, the terms of the Line of Credit Loan Documents were amended to extend the maturity date of the Promissory Note from June 15, 2009, to August 15, 2009. The Company also ratified and confirmed its obligations and liability to the Lender under the Line of Credit Loan Documents pursuant to the Amendment. The Line of Credit Loan Documents include representations, covenants and events of default that are customary for financing transactions of this nature. The Company's obligations under the Line of Credit Loan Documents are guaranteed by each of the Company's subsidiaries, and each guarantee is secured by all assets of the respective subsidiary. The Company did not meet its EBITDA and tangible net worth covenants for the quarters ended September 30 and December 31, 2008, and March 31, 2009, and National City waived its right to accelerate payment of the debt arising from the noncompliance with those covenants for those quarters. As of March 31, 2009, $15.5 million was drawn against the credit facility. Interest accrued on those borrowings amounted to roughly $26,000 as of March 31, 2009. Sparton Corporation provides design and electronic manufacturing services, which include a complete range of engineering, pre- manufacturing and post-manufacturing services. Products and services include complete "Device Manufacturing" products for Original Equipment Manufacturers, microprocessor-based systems, transducers, printed circuit boards and assemblies, sensors and electromechanical devices. The Company also develops and manufactures sonobuoys, anti-submarine warfare devices, used by the U.S. Navy and other free-world countries. The Company had $135,719,388 in total assets and $73,424,306 in total liabilities as of March 31, 2009. STANDARD MOTOR: S&P Withdraws 'CC' Corporate Credit Rating ---------------------------------------------------------- Standard & Poor's Ratings Services said it has withdrawn its 'CC' corporate credit rating and other debt ratings on Standard Motor Products Inc. at the company's request. There is a small amount of rated debt remaining after the recently completed exchange offer. The Long Island City, New York-based auto supplier has a leading market position in two product categories, engine management and temperature control. The company's products include ignition and emission parts, onboard computers, battery cables, fuel system parts, air-conditioning compressors, and heater parts. STAR TRIBUNE: Plan Offers Up to 36% Recovery for 1st Lien Lenders ----------------------------------------------------------------- The Minneapolis Star Tribune filed a disclosure statement that explains the terms of the Chapter 11 plan of reorganization that it will file with the U.S. Bankruptcy Court for the Southern District of New York. According the Disclosure Statement, the Plan offers a 29.8% to 36.1% recovery to first-lien lenders in the form of new common stock and secured notes. Unsecured creditors will recover between 0.5% and 1.3% of their claims with cash or stock and warrants. Holders of convenience claims will be paid 0.9% of the allowed amount of their claims. Holders of administrative and priority tax claims and holders of other priority claims and other secured claims will be paid in full. The first lien lenders and unsecured creditors will be entitled to vote on the Plan. Holders of equity interests will not receive any distributions under the Plan and will be deemed to reject the Plan. After careful review of their current business operations, their prospects as ongoing business enterprises and the estimated recoveries of creditors in various liquidation scenarios, Star Tribune and its affiliates have concluded that the recovery of holders of allowed claims will be maximized by the Debtors' continued operation as a going concern. The Official Committee of Unsecured Creditors is supporting the Plan. The Court will consider approval of the adequacy of the information in the Disclosure Statement on July 29. Objections are due July 20. The Debtors are proposing a July 29 record date, a September 3 deadline for ballots, and a September 17 confirmation hearing. A copy of the Disclosure Statement is available for free at: http://bankrupt.com/misc/Star_Tribune_DiscStatement.pdf Headquartered in Minneapolis, Minnesota, The Star Tribune Company -- http://www.startribune.com/-- operates the largest newspaper in the state of Minnesota and published seven days each week in an edition for the Minneapolis-Saint Paul metropolitan area. The Company and its affiliate, Star Tribune Holdings Corporation, filed for Chapter 11 protection on January 15, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-10245). Marshall Scott Huebner, Esq., James I. McClammy, Esq., and Lynn Poss, Esq., at Davis Polk & Wardwell, represent the Debtors in their restructuring efforts. Blackstone Advisory Services L.P. is the Debtors' financial advisor. Diana G. Adams, the U.S. Trustee for Region 2, selected seven members to the official committee of unsecured creditors in the Debtors' Chapter 11 cases. Scott Cargill, Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler PC, represent the Committee as counsel. When the Debtors filed for protection from their creditors, they listed assets and debts between $100 million and $500 million each. The Court has extended the Debtors' exclusive periods to file a plan of reorganization until August 13, 2009. STILA CORP: Creditors File Involuntary Ch 7 Petition Against Co. ---------------------------------------------------------------- Japanese firms Tokiwa Corp., JO Cosmetics Co., and Nihon Kolmar Co. have filed a petition before the U.S. Bankruptcy Court for the District of Delaware to send Stila Corp. to Chapter 7 liquidation, court documents say. According to court documents, the three Japanese firms claimed a total of $812,448 in debts that Stila failed to pay its debts. Stila Styles Corp. is headquartered in Glendale, California. It is incorporated in Delaware. It was once owned by Estee Lauder (EL.N) and was sold to Sun Capital in 2006. Private equity firm Patriarch bought the cosmetics assets from Stila's lenders after they foreclosed on the company, creating Stila Styles. TELEPLUS WORLD: Court Appoints Interim Receiver for Operating Arms ------------------------------------------------------------------ Teleplus World, Corp., disclosed in a filing with the Securities and Exchange Commission that the Ontario Superior Court of Justice in Ontario, Canada appointed BDO Dunwoody Limited as interim receiver. The Court set June 24, 2009, to consider this matter. Company operating subsidiaries' first secured creditors, Steve Kerekes, Melanie Kerekes, Jim Oattes, Grace Debrandere, Jim Reddon, Monica Reddon, Tom Davis and Jane Davis demanded that the Company's Canadian operating subsidiaries which include TelePlus Connect, Corp., 1523813 Ontario Limited, Avenue Reconnect, Inc. and Telizon, Inc. be appointed an interim receiver. The Interim Receiver will not operate the business of the TelePlus Group or take possession of the assets or property of the TelePlus Group pending further order from the court. The TelePlus Group will remain in possession and control of its current and future assets, and property. Subject to further order from the court, the TelePlus Group will continue to carry on business in a manner consistent with the preservation of its business. A full-text copy of the court order is available for free at: http://ResearchArchives.com/t/s?3e0e About Teleplus World, Corp. Headquartered in Miami-Lakes, Florida, Teleplus World, Corp. -- http://www.teleplusworld.com/en/-- provides telecommunications products and services including local lines, long distance, toll free and high speed internet services to customers in 53 distinct centrex serving areas. The Debtor filed for Chapter 11 protection on March 5, 2009 (Bankr. S.D. Fla. Case No. 09-13799). Phillip M. Hudson III, Esq., at Arnstein & Lehr LLP, represents the Debtor in its restructuring efforts. In its schedules of assets and debts, the Debtor disclosed $11,176,165 in total assets and $18,925,502 in total debts. TOUSA INC.: Tax Refund Pledged to Lender Subject to Attack ---------------------------------------------------------- WestLaw reports that a Chapter 11 debtor's right to a federal tax refund stemming from a net operating loss (NOL) carryback that arose in the tax year preceding the debtor's bankruptcy filing arose for the first time after the conclusion of that tax year. Thus, the secured interest in the tax refund resulting from the debtor's prepetition pledge of its general intangibles as collateral did not attach, as a matter of bankruptcy preference law, until the start of the debtor's next tax year, and was subject to attack as a preferential transfer, pursuant to the provision of the preference statute indicating that a transfer did not occur, under preference law, until the debtor acquired rights in the property transferred. In re TOUSA, Inc., --- B.R. ----, 2009 WL 1689246, http://is.gd/193rX(Bankr. S.D. Fla. Adv. Pro. No. 08-1435, June 17, 2009). TRIBUNE CO: Seeks to Employ Ernst & Young for Valuation Services ---------------------------------------------------------------- Tribune Co. and its affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to employ Ernst & Young to provide valuation and business modeling services and market survey services. Pursuant to the Valuation Services Agreement and the Statement of Work for Goodwill Impairment Testing entered into between Ernst & Young and the Debtors, Ernst & Young will provide certain valuation services to: -- assist the Debtors in testing for the impairment of goodwill and other indefinite lived intangible assets recorded in Tribune Company's consolidated financial statements in accordance with the professional guidance outlined in Statement of Financial Accounting Standards No. 142; and -- test for the recoverability of certain long-lived assets of the Company in accordance with the professional guidance outlined in Statement of Financial Accounting Standards No. 144. Ernst & Young will provide the Debtors with certain market survey services, including broadcasting marketing analysis according to the terms of the Market Services Agreement. Specifically, Ernst & Young will: (a) interview Tribune Company management concerning the nature and operations of the Newspapers, Television Stations, Tribune Media Services and Cable reporting units; (b) consider any business plans, future performance estimates or budget for the Reporting Units. (c) analyze applicable economic, industry, and competitive environments, including relevant historical and future estimated trends; (d) analyze the Reporting Units giving consideration to appropriate approaches to value, including Income Approach, Market Approach and Cost Approach; (e) analyze each indefinite lived Masthead that resides within the Newspaper's Reporting Unit; (f) review Tribune Company valuation analysis of various FCC Licenses that reside within the Television Reporting Unit; (g) discuss with Tribune Company management regarding certain intangible assets of the subject Reporting Units; (h) analyze certain intangible assets of the subject Reporting Units giving consideration to appropriate approaches to value, including, Income Approach, Market Approach and Cost Approach; (i) analyze certain identified intangible assets including, Subscriber Relationships, Advertiser Relationships, Commercial Printing and Distribution Agreements, Network Affiliation Agreements, and Assembled Workforce; (j) analyze personal and real property assets owned by the Reporting Units; and (k) prepare a narrative report summarizing the methodologies employed in its analysis, the assumptions on which its analysis was based, and its recommendations of fair value. Pursuant to separate agreements with certain Debtors, Ernst & Young has agreed to provide with information regarding the Los Angeles and New York broadcasting market, including, the size of the market and the Debtors' ranking within the market. Ernst & Young has previously been identified by the Debtors as an ordinary course professional to provide the Debtors market survey services. Given that the Debtors are now seeking to retain Ernst & Young to perform services under Section 327 of the Bankruptcy Code, the Debtors seek the Court's authority to have the Market Survey Services and related expenses provided by Ernst & Young from the Petition Date through May 31, 2009, to be authorized under the order approving the Ernst & Young employment application. The Debtors anticipate that Ernst & Young will perform the Market Survey Services on a going forward basis and that the projected quarterly fees with those will be $4,275. The Debtors project that Ernst & Young's fees in connection with the Valuation and Business Modeling Services will be roughly $150,000 per month. The Debtors will reimburse Ernst & Young for its direct expenses incurred in connection with its performance of the services and will include reasonable and out-of-pocket expenses for items like travel, meals, accommodations, telephone and others. The Debtors propose to pay Ernst & Young on the firms' customary hourly rates: Professional Rate/Hour ------------ --------- Executive Director/ Principal/Partner $525 Senior Manager $475 Manager $375 Senior $275 Staff $175 The Debtors relate that they owe Ernst & Young $2,656 for services rendered prior to the Petition Date. Ernst & Young has agreed to waive its right to the prepetition fees upon approval of this Application. Matthew Howley, a principal at Ernst & Young LLP, assures the Court that his firm is a "disinterested person" as that term is defined in Section 101(14). 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) TRIBUNE CO: Seeks Nov. 3 Extension of Deadline to Remove Actions ---------------------------------------------------------------- Tribune Company and its debtor-affiliates ask Judge Kevin J. Carey of the United States Bankruptcy Court for the District of Delaware to extend the time until November 3, 2009, within which they may file notices of removal with respect to claims and causes of action pending as of the Petition Date. The Debtors have legitimate need for additional time to review their outstanding litigation matters and evaluate whether those matters should be properly be removed pursuant to Rule 9027 of the Federal Rules of Bankruptcy Procedure, says James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois. He points out the Debtors have devoted substantially all of their resources to stabilizing their business operations and addressing critical case management issues. "Given the size of the Debtors' business enterprise and the unusually large number of Debtors involved in the procedurally consolidated cases, transitioning the Debtors' businesses into smooth operations in Chapter 11 and meeting the initial requirements of the Chapter 11 process, together with the substantial existing effort required to manage the Debtors' business enterprise and begin the formulation of a plan of reorganization, have been formidable tasks," Mr. Conlan asserts. Mr. Conlan adds that the counterparties to any claim or cause of action relating to the Debtors' chapter 11 proceedings will suffer no discernible prejudice from the sought extension. ". . . [P]reserving the Debtors' ability to remove actions imposes no delay or unnecessary burdens on any counterparties to claims or other causes of action relating to the Debtors' Chapter 11 proceedings," Mr. Conlan asserts. He adds that in the absence of the extension, the Debtors would lose a potentially key element of their overall ability to manage litigation during their Chapter 11 cases even before that litigation would reasonably have been evaluated, to the detriment of the Debtors, their estates, and their creditors as a whole. Prepetition causes of action against the Debtors are stayed by operation of the automatic stay contained in Section 362(a) of the Bankruptcy Code. 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) TRIBUNE CO: Seeks to Assume 225 Unexpired Leases ------------------------------------------------- Pre-bankruptcy, Tribune Co. and its affiliates were parties to approximately 250 office and warehouse leases, as well as approximately 65 transmitter leases. The Debtors relate that as part of their restructuring efforts, they have been working diligently with their advisors to identify which of the Leases are no longer beneficial to their estates, and which Leases are necessary to their ongoing operations. By this motion, the Debtors seek the U.S. Bankruptcy Court for the District of Delaware's authority to assume 225 Leases that are necessary to sustain their business operations through their emergence from the Chapter 11 cases and pay cure amounts with respect to the Leases. A list of the Leases for assumption and their corresponding cure amounts are available for free at: http://bankrupt.com/misc/Tribune_225LeaseAssume.pdf Stephanie Pater, director of real estate of Tribune Company, tells the Court the Debtors are dependent on the Assumed Premises to sustain their nationwide business operations, which include distribution centers, warehouses, office spaces, and broadcast towers and facilities. According to Ms. Pater, if the Debtors are denied the ability to assume the Leases at this time, the Debtors will be unable to assume the Leases at a later date and lose the benefit of these Leases as the Debtors must assume unexpired leases of nonresidential real property by July 6, 2009, or else the Leases will be deemed rejected. Ms. Pater relates the Debtors are current on all postpetition amounts owing under the Leases. She adds that the collective Cure Amount under the Leases is approximately $377,000. If any party objects to the proposed Cure Amounts or the proposed assumption of the Leases, the Debtors ask the Court to require that party to file an objection no later than 4:00 p.m., on June 18, 2009. Each objection must, among other things, be in writing, state with specificity the grounds for the objection, and be filed with the Clerk of the Bankruptcy Court and served so as to be actually received on or before the Objection Deadline by the Debtors' counsel, Tribune Company, counsel to the Steering Committee, and counsel to the Official Committee of Unsecured Creditors. The Debtors ask that, if no objection is timely received, or if a timely objection is received but does not comply with the requirements with respect to any Leases, (i) the Debtors will be authorized to assume that Lease upon the payment of the Cure amount, if necessary; and (ii) the Cure Amount will be fixed at the amount set by the Debtors. Upon entry of the Order approving this Motion, the Debtors ask the Court to bar the counterparties to the Leases assumed from asserting claims, arising on or before the date of the Order, against the Debtors, the Reorganized Debtors, or their respective successors, assigns, with respect to the Leases. AAT Objects AAT Communications LLC opposes to the cure amount set by the Debtors. AAT Communications asserts the correct amount of its lease is $10,023. Lauderdale River, Inc., complains that the Assumption Motion does not propose to pay cure amounts accrued and owing to it since May 1, 2009. Lauderdale adds that the provision of the proposed form of the Order, which provides that the Debtors are "authorized, but not required" to assume the 225 leases, is ambiguous in failing to set forth some definitive operative act through which the Riverwalk Lease will actually be assumed. Debtors File Revised Proposed Order The Debtors have made some revisions to clarify certain portions of the proposed order. The Revised Proposed Order deletes a provision, which states that the Debtors "are authorized, but not required," to assume the 225 Leases. The Revised Proposed Order states that the Debtors "are authorized" to assume the 225 leases. Moreover, the Debtors also revised the Exhibit to the Motion to specify one location with two leases and two locations governed by one lease. The BKM 3128 Redhill Assoc LLC lease was also added to the list of leases to be assumed. A full-text copy of the Revised Proposed Order and Revised Exhibit are available for free at: http://bankrupt.com/misc/Tribune_Revised225Lease.pdf 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) TRIBUNE CO: In Negotiations With Bank Lenders on Ch. 11 Plan ------------------------------------------------------------ Tribune Company is in the early stages of negotiations with senior creditors regarding a plan of reorganization which would probably transfer control of the company to a group of large banks and investors. Tribune's reorganization plan centers on a debt-for-equity swap that would probably give lenders a majority ownership in the reorganized company, the Los Angeles Times reported. The senior creditors -- a group that includes JPMorgan Chase & Co. and Citigroup Inc., as well as institutional investors and funds like Oaktree Capital Management and Angelo, Gordon & Co. -- have claims worth $8.6 billion, the report said. But the senior debt is trading on the open market for about 30 cents on the dollar, suggesting the company may be worth less than $3 billion, the report added. A source with knowledge of the situation said the reorganization plan would wipe out a $90 million warrant Samuel Zell negotiated as part of his $8.2 billion takeover deal of Tribune in 2007, LA Times related. Bankruptcy experts opined that the outline of Tribune's raises questions about whether the senior lender group would want to retain Mr. Zell and his management team or seek new leadership for the company, the LA Times related. The LA Times related that Mr. Zell's team has indicated that it wants to work toward a consensual plan with Tribune's creditors, which means issues like who manages the company and whether those managers are given equity as part of an incentive package will be negotiated over time, experts said. 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) TRIBUNE CO: Revised Schedules Of Assets And Liabilities ------------------------------------------------------- Tribune Company and its 110 debtor affiliates have filed amended schedules of assets and liabilities, disclosing: Debtor Assets Liabilities ------- ------- ----------- Tribune Company $40,170,969,941 $44,023,952,221 Tribune Finance Service Center Inc. 16,764,975,333 16,734,342,708 Los Angeles Times Communications LLC 6,856,313,305 4,566,856,469 Los Angeles Times International, Ltd. 4,904,152,418 69,744 Tribune Broadcasting Company 4,445,555,121 2,196,236,159 Chicago Tribune Company 3,943,033,285 4,282,212,553 Tribune Finance, LLC 2,822,860,274 2,886,556 Tribune Television Company 2,724,958,787 1,099,799,729 Tribune License, Inc. 2,078,601,298 4,921,000 The Baltimore Sun Company 2,371,219,728 1,558,692,941 Tribune Publishing Company 2,014,560,643 5,182,007,448 Sun-Sentinel Company 1,699,650,304 1,772,743,751 Eagle New Media Investments 1,511,448,932 13,425,336 The Hartford Courant Company 1,430,472,262 941,071,905 WGN Continental Broadcasting 1,291,136,389 993,777,430 Orlando Sentinel Communications 1,250,494,705 1,170,738,361 KTLA, Inc. 1,111,113,738 563,908,577 WPIX, Inc. 973,930,644 746,200,847 The Morning Call, Inc. 789,768,880 419,827,905 Tribune Television Northwest 758,086,305 193,951,782 Tribune Media Services, Inc. 719,730,173 660,760,441 Star Community Publishing Group 662,545,829 530,822,829 Tribune Broadcast Holdings, Inc. 475,419,361 248,920,214 Eagle Publishing Investments LLC 445,322,959 0 The Daily Press, Inc. 398,949,954 310,010,748 Channel 39, Inc. 391,000,023 120,753,039 Channel 40, Inc. 389,070,206 139,927,405 Tribune Direct Marketing, Inc. 367,000,822 342,343,024 Tribune Entertainment Company 357,781,069 324,563,425 Tribune Broadcasting Holdco 344,632,907 0 KIAH, Inc. 328,650,686 192,885,258 Tribune Media Net, Inc. 306,864,626 117,410,685 Tribune Television Holdings Inc. 272,989,339 51,320,243 WDCW Broadcasting, Inc. 260,733,436 132,272,300 KPLR, Inc. 245,373,526 101,645,237 WATL, LLC 241,423,695 687,050 Patuxent Publishing Company 235,756,111 223,580,091 KSWB, Inc. 233,749,183 125,374,105 Southern Connecticut Newspapers 232,770,677 166,137,329 Tower Distribution Company 211,388,337 91,513,725 KWGN, Inc. 202,781,185 149,171,314 Gold Coast Publications, Inc. 197,892,897 169,136,993 Homestead Publishing Company 139,390,775 90,070,837 Tribune Television New Orleans 112,246,293 96,186,727 Forum Publishing Group, Inc. 103,988,816 81,562,021 California Community News Corp. 96,844,385 57,213,895 5800 Sunset Productions, Inc. 86,341,511 74,814,289 Chicagoland Publishing Company 83,728,871 67,771,699 WLVI Inc. 81,321,930 42,747,840 Chicago Tribune Press Service 77,292,511 73,561,767 Virginia Gazette Companies, LLC 72,109,589 27,437,917 Tribune Broadcasting News Network 70,120,941 66,451,336 Greenco, Inc. 64,447,029 0 Valumail, Inc. 60,678,512 70,189,847 Chicagoland Television News, Inc. 54,341,703 50,834,608 New Mass Media, Inc. 43,396,839 37,198,233 Neocomm, Inc. 43,099,841 43,099,840 Tribune New York Newspaper Holdings 38,117,131 45,111,680 Tribune California Properties, Inc. 31,778,148 28,739,555 New River Center Maintenance 25,252,721 6,914,065 Direct Mail Associates, Inc. 21,438,173 17,930,799 Chicago Tribune Newspapers, Inc. 20,559,004 20,472,371 Forsalebyowner.com Corp. 18,841,682 8,716,780 Hoy Publications, LLC 18,030,926 19,127,541 Times Mirror Land and Timber Co. 17,276,815 281 TMS Entertainment Guides, Inc. 12,901,901 8,877,449 WCWN LLC 8,644,697 706,503 Insertco, Inc. 8,793,408 79,187 TMLS1, Inc. 7,819,575 0 North Orange Avenue Properties 5,527,074 4,207,761 NBBF, LLC 5,086,140 0 Baltimore Newspaper Network, Inc. 4,955,399 4,504,791 Tribune NM, Inc. 4,556,494 0 Hoy, LLC 3,331,167 5,855,695 Newspaper Readers Agency, Inc. 1,740,959 5,439 Courant Specialty Products 1,507,783 1,755,770 Fortify Holdings Corporation 1,040,147 0 Candle Holdings Corporation 1,040,148 0 Sentinel Communications News 882,117 796 435 Production Company 841,947 219,159 Oak Brook Productions, Inc. 743,143 753,839 Channel 20, Inc. 642,843 1,106,983 Chicago Avenue Construction Company 429,081 264,046 Internet Foreclosure Service, Inc. 488,038 3,643 Heart & Crown Advertising, Inc. 345,374 0 Virginia Community Shoppers, LLC 341,505 391,246 Times Mirror Payroll Processing Co. 309,936 111,401 Newscom Services, Inc. 122,111 97,134 Tribune Entertainment Production Co. 104,858 104,944 Chicago River Production Company 95,160 95,458 North Michigan Production Company 9,699 9,997 Homeowners Realty, Inc. 7,169 0 Shepard's Inc. 1,001 623 Stemweb, Inc. 770 721 Signs of Distinction, Inc. 2 0 Chicagoland Microwave License, Inc. 0 1,094 Publishers Forest Products Co. of Wash. 0 42 Fourteen Debtors disclose $0 assets and liabilities in their amended schedules: * WTXX Inc. * Forsalebyowner.com Referral Services LLC * Tribune Los Angeles, Inc. * Tribune Manhattan Newspaper Holdings, Inc. * Tribune Network Holdings Company * Towering T Music Publishing Company * Times Mirror Services Company, Inc. * TMLH2, Inc. * The Other Company LLC * Los Angeles Times Newspapers, Inc. * Magic T Music Publishing * Juliusair Company, LLC * Juliusair Company II, LLC * Distribution Systems of America, Inc. 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) TXP CORPORATION: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: TXP Corporation fka Jesse Livermore.com, Inc. fka Stock Market Solutions, Inc. dba iphotonics Corporation fka YTXP Corporation aka Texas Prototypes, Inc. dba iphotonics 1299 Commerce Drive Richardson, TX 75081 Bankruptcy Case No.: 09-43659 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Northern District of Texas (Ft. Worth) Judge: D. Michael Lynn Debtor's Counsel: Lynda L. Lankford, Esq. Forshey & Prostok, LLP 777 Main Street, Ste. 1290 Fort Worth, TX 76102 Tel: (817) 878-2022 Fax: (817) 877-4151 Email: llankford@forsheyprostok.com Total Assets: $3,640,000 Total Debts: $16,800,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Michael Shores, president of the Company. VIRGIN MOBILE: Registers $18,950,000 Shares Under Incentive Plan ---------------------------------------------------------------- Virgin Mobile USA Inc. filed with the Securities and Exchange Commission a Form S-8 Registration Statement to register: -- 5,000,000 of Class A common stock to be issued to eligible directors, officers and employees of the Company under The Virgin Mobile USA, Inc. 2007 Omnibus Incentive Compensation Plan, as amended; and -- pursuant to Rule 416(a) under the Securities Act of 1933, an indeterminate amount of additional shares of Class A common stock that may be offered and issued to prevent dilution resulting from stock splits, stock distributions or similar transactions. The proposed maximum aggregate offering price is $18,950,000. About Virgin Mobile USA Inc. Headquartered in Warren, New Jersey, Virgin Mobile USA Inc. (NYSE: VM) -- http://www.virginmobileusa.com/-- provides wireless, pay- as-you-go communications services without annual contracts. The company was founded as Virgin Mobile USA, LLC, a joint venture between Sprint Nextel and the Virgin Group, and launched its service nationally in July 2002. In October 2007, it completed its initial public offering and a related reorganization. At March 31, 2009, the Company had $323,814,000 in total assets and $605,594,000 in total liabilities. VISANT HOLDING: S&P Raises Corporate Credit Rating to 'BB-' ----------------------------------------------------------- Standard & Poor's Ratings Services said that it raised its corporate credit and issue-level ratings on Armonk, New York-based school affinity provider and niche printing company Visant Holding Corp. to 'BB-' from 'B+' and removed the rating and all issue- level ratings from CreditWatch, where they were placed with positive implications on May 14, 2009. The rating outlook is stable. At the same time, S&P raised the issue-level ratings on operating subsidiary, Visant Corp.'s, senior secured credit facilities to 'BB+' (two notches higher than the 'BB-' corporate credit rating on holding company parent Visant Holding Corp.) from 'BB'. The recovery rating remains unchanged at '1', indicating S&P's expectation of very high (90% to 100%) recovery for lenders in the event of a payment default. S&P raised the issue-level rating on Visant Corp.'s subordinated debt to 'BB-' (at the same level as the 'BB-' corporate credit rating) from 'B+', and revised the recovery rating to '3', indicating S&P's expectation of meaningful (50% to 70%) recovery in the event of a payment default, from '4'. S&P raised the issue-level rating on Visant Holding Corp.'s senior unsecured debt to 'B' (two notches lower than the 'BB-' corporate credit rating) from 'B-'. The recovery rating remains unchanged at '6', indicating S&P's expectation of negligible (0% to 10%) recovery for debtholders in the event of a payment default. "The 'BB-' corporate credit rating reflects Visant's good credit measures and our belief that a moderately less aggressive financial policy will enable the company to sustain leverage-- fully adjusted for operating leases and postretirement obligations--at less than 5x," said Standard & Poor's credit analyst Michael Listner. "Although S&P expects that economic weakness will negatively affect some of Visant's business segments, particularly the Marketing and Publishing Services segment, the company's presence in the relatively stable yearbook business and S&P's expectations regarding management's cost reduction efforts will somewhat mitigate S&P's concerns regarding S&P's expectation for a decline in consolidated revenue and EBITDA for 2009." For analytical purposes, Standard & Poor's views Visant Holding Corp. and Visant Corp. (jointly referred to as Visant) as a single economic entity. The stable outlook on Visant reflects S&P's increased comfort with the company's financial policy (the historically aggressive nature, which had previously constrained the rating) and S&P's expectation that the company will sustain consolidated leverage (fully adjusted for operating leases and postretirement obligations) of less than 5x over the intermediate term. Although S&P continue to expect that current economic conditions will affect operating performance, particularly in the class ring and direct marketing businesses, S&P expects that management's cost reduction efforts will somewhat offset this trend and lead to S&P's expectation for a low-single-digit decline in EBITDA for 2009. Given Visant's cushion relative to the 5x leverage measure, and the company's ability to generate excess cash to potentially pay down debt, it is unlikely that S&P would lower the rating in the near term. S&P would become less comfortable with the current rating, however, if it appears that EBITDA declines will exceed S&P's current expectations and S&P believes that total adjusted debt to EBITDA would exceed 5x for a sustained period of time. A revision of the outlook to positive is less likely at this time and would require an expectation for a sustained, marked improvement to credit measures, possibly as a result of management moving toward a much more conservative financial policy. WADE INVESTMENTS: Case Summary & 4 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Wade Investments, LLC 404 West Hand Avenue, Unit #200 Wildwood, NJ 08260 Bankruptcy Case No.: 09-25865 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court District of New Jersey (Camden) Judge: Gloria M. Burns Debtor's Counsel: Andrew L. Unterlack, Esq. Scott H. Marcus & Assoc. 121 Johnson Road Turnersville, NJ 08012 Tel: (856) 227-0800 Fax: (856) 227-7939 Email: aunterlack@marcuslaw.net Total Assets: $500,000 Total Debts: $2,664,402 A full-text copy of the Debtor's petition, including a list of its 4 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/njb09-25865.pdf The petition was signed by Jon P. Paxton, managing member of the Company. WCI COMMUNITIES: Court Approves $14.6MM Sale of Regent Bal Harbour ------------------------------------------------------------------ The United States Bankruptcy Court for the District of Delaware has approved the immediate sale of The Regent Bal Harbour Hotel by WCI Communities, Inc., to Elevation Communities, LLC, or its nominee, El Com Hotel & Spa, LLC. The Court also approved the rejection of the existing management contract for the property. The Purchaser has offered $14,600,000 for the property -- $12,000,000 of which will be allocated to the purchase of the lots and personal property, and $2,600,000 of which will be allocated to the purchase of units and furnishing packages. In their motion, the Debtors said they received 17 written bids from interested purchasers. They considered Elevation's offer the best and highest. The Debtors cancelled the auction on the property. The Debtors, in consultation with the official committee of unsecured creditors appointed in their cases, determined that no competing bidder constituted a qualifying bidder and no auction was necessary. As a result of the sale, Regent Hotels & Resorts ended its management of The Regent Bal Harbour Hotel effective June 22, 2009. The Regent Bal Harbour was ranked by Travel + Leisure magazine among "15 hotels to watch" in the most recent "World's Best" issue. The brand is continuing to expand globally, including the opening of eight new hotels over the next three years in locations that span the world, from Puerto Rico to the Maldives. About WCI Communities Headquartered in Bonita Springs, Florida, WCI Communities, Inc., (Pink Sheets: WCIMQ) -- http://www.wcicommunities.com/-- is a fully integrated homebuilding and real estate services company. It has operations in Florida, New York, New Jersey, Connecticut, Massachusetts, Virginia and Maryland. The company directly employs roughly 1,800 people, as well as roughly 1,800 sales representatives as independent contract employees. The Company and 126 of its affiliates filed for Chapter 11 protection on August 4, 2008 (Bankr. D. Del. Lead Case No. 08-11643 through 08-11770). Thomas E. Lauria, Esq., Frank L. Eaton, Esq., and Linda M. Leali, Esq., at White & Case LLP, in Miami, Florida, represent the Debtors as counsel. Eric Michael Sutty, Esq., and Jeffrey M. Schlerf, Esq., at Fox Rothschild LLP, represent the Debtors as Delaware counsel. Lazard Freres & Co. LLC is the Debtors' financial advisor. Epiq Bankruptcy Solutions LLC is the claims and notice agent for the Debtors. The U.S. Trustee for Region 3 appointed five creditors to serve on an official committee of unsecured creditors. Daniel H. Golden, Esq., Lisa Beckerman, Esq., and Philip C. Dublin, Esq., at Akin Gump Strauss Hauer & Feld LLP; and Laura Davis Jones, Esq., Michael R. Seidl, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the committee in these cases. When the Debtors filed for protection from their creditors, they listed total assets of $2,178,179,000 and total debts of $1,915,034,000. WEDGE ENERGY: To File Financial Reports by Month's End ------------------------------------------------------ Wedge Energy International Inc. reports that it applied to the Ontario Securities Commission for a management cease trade order to be imposed against certain of the Company's executive officers -- and at the discretion of the OSC, some or all of the persons who have been directors, officers or insiders of the Company. On May 15, 2009, the OSC issued a management cease trade order against the Chief Executive Officer and the Chief Financial Officer of the Company. The issuance of the management cease trade order does not affect the ability of persons to trade in their securities of the Company, other than the Chief Executive Officer the Chief Financial Officer. However, the OSC, in its discretion, may determine at a later time that it would be appropriate to issue a general issuer cease trade order affecting all of the Company's securities if the Company fails to satisfy the provisions of the Alternative Information Guidelines required pursuant to National Policy 12-203 Cease Trade Orders for Continuous Disclosure Defaults. On April 30, 2009, Wedge said it was not able to file its audited annual financial statements, management's discussion and analysis and related certifications for the fiscal year ended December 31, 2008, within the prescribed time. On May 27, 2009, Wedge said it would delay the filing of its interim financial statements, management's discussion and analysis and related certifications for the three month period ended March 31, 2009, beyond the filing deadline of May 31, 2009. The Company is working with its auditors to complete the audit of the Statements and expects to be in a position to file the Statements with the OSC on or before June 30, 2009. Until the Statements are filed, the Company intends to satisfy the Alternative Information Guidelines by issuing bi-weekly Default Status Reports, each of which will be issued in the form of a press release. If the Statements are not filed beforehand, the Company intends to issue its next Default Status Report on July 6, 2009. Given the delay in completing and filing the Statements the Company was unable to complete and file its interim financial statements, management's discussion and analysis and related certifications for the three month period ended March 31, 2009 prior to the filing deadline of May 31, 2009. The Company now expects that the filing of the interim results for the three month period ended March 31, 2009, will now occur on or about July 15, 2009. On the Net: http://www.wedgeenergy.com/ WHALEY PARTNERS: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Whaley Partners, a N.C. General Partnership 296 Vine Swamp Road Kinston, NC 28504 Bankruptcy Case No.: 09-05121 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Eastern District of North Carolina (Wilson) Debtor's Counsel: Gordon C. Woodruff, Esq. Woodruff, Reece & Fortner PO Box 708 Smithfield, NC 27577 Tel: (919) 934-4000 Fax: (919) 934-5884 Email: gwoodruff@wrflaw.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/nceb09-05121.pdf The petition was signed by Wiliam L. Whaley, Jr., general partner of the Company. WILLIAM THIELE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Joint Debtors: William Richard Thiele Patricia Harris Thiele P.O. Box 1299 Sevierville, TN 37764 Bankruptcy Case No.: 09-51682 Chapter 11 Petition Date: June 19, 2009 Court: United States Bankruptcy Court Eastern District of Tennessee (Greeneville) Judge: Marcia Phillips Parsons Debtors' Counsel: Edward J. Shultz, Esq. Ayres & Parkey P.O. Box 23380 Knoxville, TN 37933 Tel: (865) 637-1181 Email: eshultz@ayreslaw.com Total Assets: $4,364,957 Total Debts: $6,450,631 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/tneb09-51682.pdf The petition was signed by the Joint Debtors. YOUNG BROADCASTING: Bid Deadline Extended to July 10 ---------------------------------------------------- The bidding and auction in connection with the sale as a going concern, of all or part of Young Broadcasting Inc. and its affiliates' business have been extended, in accordance with this schedule: Deadline to conclude due diligence July 9, 2009 Bid Deadline July 10, 2009, at 4:00 p.m. (Eastern) Auction, if necessary July 14, 2009, at 10:00 a.m. (Eastern) Deadline to object to approval of a Transaction with the Prevailing Bidder July 14, 2009, at 11:00 p.m. (Eastern) Approval Hearing July 15, 2009, at 10:00 a.m. (Easte\rn) Young Broadcasting, Inc. -- http://www.youngbroadcasting.com/-- owns 10 television stations and the national television representation firm, Adam Young Inc. Five stations are affiliated with the ABC Television Network (WKRN-TV - Nashville, TN, WTEN-TV - Albany, NY, WRIC-TV - Richmond, VA, WATE-TV - Knoxville, TN, and WBAY-TV - Green Bay, WI), three are affiliated with the CBS Television Network (WLNS-TV - Lansing, MI, KLFY-TV - Lafayette, LA and KELO-TV - Sioux Falls, SD), one is affiliated with the NBC Television Network (KWQC-TV - Davenport, IA) and one is affiliated with MyNetwork (KRON-TV - San Francisco, CA). In addition, KELO- TV- Sioux Falls, SD is also the MyNetwork affiliate in that market through the use of its digital channel capacity. The Company and its affiliates filed for Chapter 11 protection on February 13, 2009 (Bankr. S.D.N.Y. Lead Case No.: 09-10645). Jo Christine Reed, Esq., at Sonnenschein Nath & Rosenthal LLP, represents the Debtors in their restructuring efforts. Andrew N. Rosenberg, Esq., at Paul Weiss Rifkind Wharton & Harrison LLP, represents the official committtee of unsecured creditors as counsel. The Debtors selected UBS Securities LLC as consultant; Ernst & Young LLP as accountant; Epiq Bankruptcy Solutions LLC as claims agent; and David Pauker chief restructuring officer. The Debtors listed total assets of $575,600,070 and total debts of $980,425,190. YPG HOLDINGS: S&P Assigns 'BB+' Rating on Subordinated Debt ----------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'BBB-' debt rating to Montreal-based YPG Holdings Inc.'s proposed C$260 million 7.3% senior unsecured medium-term notes due Feb. 2, 2015. The notes are fully and unconditionally guaranteed by 100%- owned operating subsidiaries Yellow Pages Group Co. and Trader Corp. as well as by parent Yellow Pages Income Fund. The notes are being issued under the company's C$1 billion short-form base shelf prospectus filed June 20, 2008. Net proceeds will be used for general corporate purposes, to repay indebtedness outstanding under the company's commercial paper program and to repay C$200 million under its term credit facility. "The 'BBB-'corporate credit rating and stable outlook on YPG reflect what S&P views as the company's solid business risk profile, supported by its position as the leading publisher of telephone directories in Canada and national provider of classified advertising," said Standard & Poor's credit analyst Madhav Hari. "The rating also reflects YPG's track record of sustaining healthy operating margins in the core directories operations," Mr. Hari added. These factors are partially offset by what S&P considers the company's aggressive financial risk profile characterized by high debt leverage and weak cash flow protection measures. YPG is indirectly 98%-owned by YPIF, and represents YPIF's sole asset. YPG is a holding company that conducts its business exclusively through its 100%-owned operating subsidiaries: Yellow Pages Group Co., Canada's largest directories publisher, with more than 340 directories and a circulation of about 30 million; and Trader Corp., which comprises a national platform in the classified advertising business, with more 160 publications and 20 Web sites. In 2008, YPG generated C$1.7 billion in revenue and EBITDA of C$933 million. Ratings List YPG Holdings Inc. Corporate credit rating BBB-/Stable/-- Preferred stock P-3 Senior unsecured debt BBB- Subordinated debt BB+ Rating Assigned YPG Holdings Inc. C$260 million senior unsecured notes BBB- * 151 Sidley Lawyers Recognized in Chambers USA ----------------------------------------------- Chambers USA: America's Leading Lawyers for Business has named 151 lawyers from Sidley Austin LLP as leaders in their field in their 2009 guide. In addition to lawyer rankings, the Chambers guide ranks practices on a national and regional basis. Seventy-three practice areas in Sidley's U.S. offices were recognized, with 18 receiving number one rankings. Sidley also received 170 lawyer rankings for 151 recognized lawyers, including 35 number one rankings and six "Up and Coming" rankings in a broad range of practice areas. Carter G. Phillips, managing partner of Sidley's Washington D.C. office, received a "Star" ranking in Appellate Law (National), Chambers and Partners' designation for their highest level of rankings. Additionally, Thomas C. Green, a partner in Sidley's Washington, D.C. office, was recognized as the top lawyer in the area of white collar crime and government investigations at The Chambers Awards for Excellence 2009. The 18 number one ranked practice areas are: * National (8) -- Capital Markets: Securitization; Capital Markets: Structured Products; Environment; Financial Services Regulation: Consumer Financial Services Regulation; Insurance: Regulation; International Trade; Investment Funds: Hedge Funds; Transportation: Rail (for Railroads). * District of Columbia (1) -- Environment. * Illinois (9) -- Antitrust; Banking & Finance; Corporate/M&A & Private Equity; Environment; Insurance: Transactional & Regulatory; Intellectual Property; Labor & Employment: Benefits & Compensation; Media & Entertainment: Litigation; Real Estate. Thirty-two Sidley lawyers achieved 35 individual number one rankings for their work in specific practice areas. Lawyers who received number one rankings in the National category include: Norman Slonaker for Capital Markets: Debt & Equity; Thomas W. Albrecht and Renwick Martin for Capital Markets: Securitization; Renwick Martin and Robert J. Robinson for Capital Markets: Structured Products; Jeff S. Liebmann for Insurance: Regulation; Daniel M. Price and Andrew W. Shoyer for International Trade: Trade Remedies & Trade Policy; William D. Kerr, David R. Sawyier and Michael J. Schmidtberger for Investment Funds: Hedge Funds; Thomas C. Green for Litigation: Trial Lawyers; Alan Charles Raul for Privacy & Data Security; and G. Paul Moates for Transportation: Rail (for Railroads). In Illinois, these lawyers received number one rankings: Charles W. Douglas for Antitrust; James Clark for Banking & Finance; Lawrence Nyhan for Bankruptcy/Restructuring; David Carpenter for Communications; Thomas A. Cole and Frederick C. Lowinger for Corporate/M&A Richard W. Astle for Energy & Natural Resources: Transactional; Robert Olian for Environmental: Litigation; William M. Sneed and James R. Stinson for Insurance: Reinsurance Litigation; Michael P. Goldman and Kenneth R. Wylie for Insurance: Transactional & Regulatory; David T. Pritikin for Intellectual Property; Priscilla E. Ryan for Labor & Employment: Benefits & Compensation; Richard O'Brien for Media & Entertainment: Litigation; and Lee M. Smolen for Real Estate. In the District of Columbia, these lawyers all received number one rankings: Eugene R. Elrod for Energy: Oil & Gas; David Buente for Environment; and Thomas C. Green for Litigation: White Collar Crime & Government Investigations. In New York, Jeff S. Liebmann received a number one ranking in the Insurance: Transactional & Regulatory category. Paul Walker of the Los Angeles office received a number one ranking in Real Estate in California. The six lawyers who received "Up and Coming" rankings are: Melanie S. Murakami for Banking & Finance (California); Timothy K. Webster for Environment (District of Columbia); Amanda Todd for Insurance: Transactional & Regulatory (Illinois); Michael Madigan for Insurance: Transactional & Regulatory (New York); John T. Schaff for Tax (Illinois); and Paul A. Hemmersbaugh for Transportation: Rail (for Railroads) (National). A firm profile and complete rankings for Sidley are available on the Chambers and Partners Web site at: http://www.chambersandpartners.com In the 2008 guide, 138 Sidley lawyers were recognized. The U.K.-based international publisher Chambers and Partners based its report on in-depth interviews with leading private practice lawyers and key in-house counsel. A team of over 50 full-time researchers conducted the survey with law firms and lawyers chosen on merit only. Sidley Austin LLP is one of the world's largest full-service law firms, with approximately 1800 lawyers practicing in 16 U.S. and international cities, including Beijing, Brussels, Frankfurt, Geneva, Hong Kong, London, Shanghai, Singapore, Sydney and Tokyo. Every year since 2003, Sidley has been named to Legal Business' Global Elite, its designation for the 18 firms "that define the pinnacle of the legal profession." BTI, a Boston-based consulting and research firm, has named Sidley to their Client Service Hall of Fame as one of only two law firms to rank in the Client Service Top 10 for seven years in a row, and to the BTI Power Elite as one of only seven law firms demonstrating the best client relationships for the fourth consecutive year. * Tom Behnke Joins Alvarez & Marsal as Senior Director ------------------------------------------------------ Tom Behnke has joined Alvarez & Marsal as a senior director in the Claims Management Services Group. He is based in Houston. An expert in assisting debtors in all phases of bankruptcy case administration and claims management for more than 20 years, Mr. Behnke has worked on a number of high profile and complex restructuring engagements, including Dow Corning Corporation, Delphi Corporation, Enron Corp and Circuit City. Mr. Behnke also brings substantial financial consulting and litigation support experience which strengthens his ability to assist debtors in resolving complex issues that arise in restructurings. His expertise spans various industries including automotive, retail, manufacturing, oil and gas, real estate, healthcare, and financial services. "With a comprehensive combination of restructuring and claims management experience that includes working on some of the largest and most complex restructuring engagements of recent record and high profile debtor and creditor consulting work, Tom is a perfect addition to the growing claims management services team both in Houston and nationally," said Julie Hertzberg, a managing director and head of A&M's Claims Management Services Group. Prior to joining A&M, Mr. Behnke was a managing director with the corporate finance practice of FTI Consulting. Before FTI, he was a director with the restructuring practice of PricewaterhouseCoopers. He also worked as a financial analyst with Abbott Laboratories. Mr. Behnke began his career as an auditor with Arthur Andersen. Mr. Behnke earned a bachelor's degree in accounting from Northern Illinois University. He is a Certified Public Accountant (CPA) licensed with the Texas State Board of Public Accountancy and a member of the American Bankruptcy Institute (ABI). About Alvarez & Marsal For 25 years, Alvarez & Marsal -- http://www.alvarezandmarsal.com -- a global professional services firm, has set the standard for working with organizations to solve complex problems, improve performance, drive critical change and maximize value for stakeholders. The firm draws on a deep operational heritage and hands-on approach to deliver comprehensive performance improvement, turnaround management, business advisory and interim management services. Its clients range from global enterprises to middle market companies that are both publicly held or privately owned, as well as large and mid-cap private equity firms, corporate management and boards of directors. A&M applies its capabilities across industry sectors, with dedicated industry expertise in financial services, healthcare, real estate and the public sector and offices around the world. A founder of the modern day restructuring industry, Alvarez & Marsal has been honored numerous times by the Turnaround Management Association and has been recognized as one of the top ten best firms to work for by Consulting Magazine. * Automobile Dealers, Nursing Homes, Hotels Prone to Bankruptcy --------------------------------------------------------------- Sageworks Inc. issued a report this week identifying 10 types of private businesses most likely to file bankruptcy in the coming months. 10 Bankruptcy-Prone Industries Debt/Equity Net Profit Industry Ratio % Change -------- ----- -------- Automobile Dealers 4.45 -19.38% Other Motor Vehicle Dealers 4.42 -10.75% Nursing Care Facilities 4.11 -1.37% Hotels & Traveler Accommodations 3.94 6.61% Sporting Goods & Hobby Stores 3.91 1.67% Land Development & Subdivision Companies 3.85 -41.63% Investigation & Security Services 3.48 -4.27% Residential Building Companies 3.45 -20.87% Motor Vehicle Parts Manufacturers 3.45 -15.97% Printing Companies 3.02 -12.95% * Year-Ended-May 2009 Consumer Price Index Decline Most in 60 Yrs ----------------------------------------------------------------- According to Bill Rochelle at Bloomberg, the consumer price index fell 1.3 percent for the year ended in May, the largest decline in almost 60 years. The report relates that consumer prices rose 0.1% in May after coming in flat the month before. Excluding food and fuel, the index at the end of May was 1.8 percent higher than the year before. Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 5.7% in the first quarter of 2009, according to preliminary estimates released by the Bureau of Economic Analysis on May 29. In the fourth quarter, real GDP decreased 6.3%. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Share- Total Total Holders Working Assets Equity Capital Company Ticker ($MM) ($MM) ($MM) ------- ------ ------ ------- ------- ABSOLUTE SOFTWRE ABT CN 107 (7) 24 AFC ENTERPRISES AFCE US 131 (33) 2 AMER AXLE & MFG AXL US 2072 (452) 64 AMR CORP AMR US 24518 (3,108) (3,545) ARBITRON INC ARB US 189 (3) (22) ARRAY BIOPHARMA ARRY US 108 (54) 31 ARVINMERITOR INC ARM US 2873 (719) 278 AUTOZONE INC AZO US 5296 (45) (527) AVATAR HOLDINGS AVTR US 585 0 N.A. BLOUNT INTL BLT US 499 (43) 175 BOARDWALK REAL E BEI-U CN 2318 (5) N.A. BOARDWALK REAL E BOWFF US 2318 (5) N.A. BOEING CO BA US 55339 (509) (2,160) BOEING CO BAB BB 55339 (509) (2,160) BOEING CO-CED BA AR 55339 (509) (2,160) BRIGHAM EXPLOR BEXP US 365 2 17 BURCON NUTRASCIE BU CN 4 3 2 CABLEVISION SYS CVC US 9551 (5,349) (367) CENTENNIAL COMM CYCL US 1413 (992) 148 CENVEO INC CVO US 1501 (221) 163 CHENIERE ENERGY CQP US 1975 (408) 79 CHOICE HOTELS CHH US 333 (146) (10) CLOROX CO CLX US 4464 (309) (866) DELTEK INC PROJ US 191 (48) 42 DISH NETWORK-A DISH US 7063 (1,666) (422) DOMINO'S PIZZA DPZ US 473 (1,396) 99 DUN & BRADSTREET DNB US 1614 (785) (176) EMBARQ CORP EQ US 8050 (527) (163) ENERGY COMPOSITE ENCC US 0 0 0 EPICEPT CORP EPCT SS 12 (5) (2) EXELIXIS INC EXEL US 355 (88) 53 EXTENDICARE REAL EXE-U CN 1833 (51) 98 FORD MOTOR CO F US 207270 (16,476) 12,631 FORD MOTOR CO F BB 207270 (16,476) 12,631 FX ENERGY INC FXEN US 38 7 7 GARTNER INC IT US 948 4 (223) GENTEK INC GETI US 430 (8) 102 GLG PARTNERS INC GLG US 345 (382) 101 GLG PARTNERS-UTS GLG/U US 345 (382) 101 GOLD RESOURCE CO GORO US 9 9 7 HALOZYME THERAPE HALO US 68 3 52 HEALTHSOUTH CORP HLS US 1921 (656) (53) HOLLY ENERGY PAR HEP US 469 0 (6) IDENIX PHARM IDIX US 96 9 50 IMAX CORP IMX CN 226 (98) 19 IMAX CORP IMAX US 226 (98) 19 IMS HEALTH INC RX US 2026 4 328 INCYTE CORP INCY US 189 (256) 123 INTERMUNE INC ITMN US 193 (82) 121 IPCS INC IPCS US 545 (41) 62 JOHN BEAN TECH JBT US 559 (6) 78 JUST ENERGY INCO JE-U CN 535 (692) (358) KNOLOGY INC KNOL US 635 (52) 25 LINEAR TECH CORP LLTC US 1491 (288) 995 LIONS GATE LGF US 1667 (8) (819) MAP PHARMACEUTIC MAPP US 78 4 32 MAXLIFE FUND COR MXFD US 0 0 0 MEAD JOHNSON-A MJN US 1707 (897) 380 MEDIACOM COMM-A MCCC US 3700 (463) (281) MEDIVATION INC MDVN US 211 0 128 MESABI TRUST MSB US 7 0 0 MODAVOX INC MDVX US 6 4 0 MOLECULAR INSIGH MIPI US 107 (62) 86 MOODY'S CORP MCO US 1802 (919) (482) NATIONAL CINEMED NCMI US 604 (514) 89 NAVISTAR INTL NAV US 9656 (1,447) 1,784 NPS PHARM INC NPSP US 200 (225) 87 NYMOX PHARMACEUT NYMX US 0 (1) 0 OCH-ZIFF CAPIT-A OZM US 1821 (177) N.A. OVERSTOCK.COM OSTK US 136 (4) 33 PALM INC PALM US 656 (84) 30 PDL BIOPHARMA IN PDLI US 219 (422) 79 PERMIAN BASIN PBT US 10 0 9 PETROALGAE INC PALG US 5 (23) (7) PML INC PMLN US 6 2 0 POTLATCH CORP PCH US 917 0 N.A. QWEST COMMUNICAT Q US 19711 (1,164) (344) RASER TECHNOLOGI RZ US 184 7 (58) REGAL ENTERTAI-A RGC US 2563 (246) (78) RENAISSANCE LEA RLRN US 52 (3) (11) REVLON INC-A REV US 784 (1,095) 103 SALLY BEAUTY HOL SBH US 1433 (702) 389 SANDRIDGE ENERGY SD US 2670 (114) 118 SEMGROUP ENERGY SGLP US 349 (124) 23 SIGA TECH INC SIGA US 7 (6) (3) SOLARWINDS INC SWI US 91 (40) 23 SONIC CORP SONC US 821 (43) 26 STANDARD PARKING STAN US 231 0 (15) STEREOTAXIS INC STXS US 53 (4) 3 SUCCESSFACTORS I SFSF US 162 (7) 0 SUN COMMUNITIES SUI US 1197 (68) N.A. TALBOTS INC TLB US 999 (184) (28) TAUBMAN CENTERS TCO US 2922 (276) N.A. TENNECO INC TEN US 2742 (304) 272 THERAVANCE THRX US 214 (144) 152 UAL CORP UAUA US 19100 (2,655) (2,348) UNITED RENTALS URI US 3976 (56) 266 UNIVERSAL ENERGY UEG CN 417 2 (17) VECTOR GROUP LTD VGR US 683 5 44 VENOCO INC VQ US 683 5 44 VERIFONE HOLDING PAY IT 730 (107) 33 VERIFONE HOLDING PAY US 843 (14) 299 VERIFONE HOLDING VF2 GR 843 (14) 299 VIRGIN MOBILE-A VM US 843 (14) 299 WALTER INVESTMEN WAC US 323 (281) (141) WARNER MUSIC GRO WMG US 12 (44) N.A. WEIGHT WATCHERS WTW US 4256 (110) (394) WR GRACE & CO GRA US 1087 (848) (313) ZYMOGENETICS INC ZGEN US 3726 (374) 892 ********* 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 ***