/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/090911.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, September 11, 2009, Vol. 13, No. 252 Headlines AGILENT TECHNOLOGIES: Note Issuance Won't Affect Moody's Ratings AMERICAN MEDICAL: S&P Affirms Corporate Credit Rating at 'BB-' AMERICAN TONERSERV: Files Information Sheet With SEC ANDRE REVELEY: Case Summary & 12 Largest Unsecured Creditors APPLETON PAPERS: Extends Exchange Offer Deadline to September 16 ARTHUR GAMBOA: Case Summary & 20 Largest Unsecured Creditors ARVINMERITOR INC: Files Copies of GMAC Receivables Deal AVAGO TECH: Offers 95 Cents on Dollar for Floating Rate Notes AVIS BUDGET: Shapiro Capital Unloads Equity Stake BACCHUS DEV'T: In Default of Union Bank Loans; Files for Ch 11 BALQON CORPORATION: Posts $758,000 Net Loss in Qtr. Ended June 30 BARZEL INDUSTRIES: Nasdaq to Delist Shares Effective Sept. 18 BASHAS' INC: To Close Food City in Arizona This Week BELK PROPERTIES LLC: Voluntary Chapter 11 Case Summary BERNARD MADOFF: Two NY & Florida Properties Put on Sale CABLEVISION SYSTEMS: Moody's Puts 'B1' Rating on $500 Mil. Notes CABLEVISION SYSTEMS: S&P Assigns 'B+' Rating on $500 Mil. Notes CANWEST GLOBAL: Unit Has Sale Deal with Local Investor Group CANWEST LIMITED: Reaches Forbearance Pact With Senior Lenders CARAUSTAR INDUSTRIES: S&P Withdraws 'D' Corporate Credit Rating CARUSO HOMES: Exits Chapter 11 Bankruptcy Protection CCS MEDICAL: Has Deal to Sell NovaMax to Nova Biomedical CCS MEDICAL: Proposes November 3 General Claims Bar Date CEDAR FUNDING: Ex-President Charged for Defrauding $150MM CELL THERAPEUTICS: FDA to Review Pixantrone NDA in April 2010 CENTERPOINT ENERGY: Joint Venture Won't Move Moody's 'Ba1' Rating CIB MARINE: Plan Voting for TruPS Holders Extended to Sept. 15 CHARYS HOLDING: Trustee Wants Court to Disallow Claims in Records CHIYODA AMERICA: Can Hire Garden City as Claims and Noticing Agent CHIYODA AMERICA: Selects Executive Sounding as Turnaround Advisor CIB MARINE: Debtholders' Vote on Plan Extended Until Sept. 15 CLEARANT INC: June 30 Balance Sheet Upside-Down by $1.76 Million COLONIAL BANCGROUP: NYSE Delists Securities Effective September 18 COLUMBIAN PUBLISHING: Files Reorganization Plan COMMERCIAL VEHICLE: S&P Raises Corporate Credit Rating to 'CCC+' COMMUNITY BANCORP: Nasdaq to Delist Shares Effective September 18 COMSTOCK HOMEBUILDING: Royce Holds 1.99% of Class A Shares CONCHO RESOURCES: S&P Assigns Corporate Credit Rating at 'BB' CORUS BANKSHARES: Potential Investors Get OK to Form New Bank COYOTES HOCKEY: NHL's Bid May Be Unfair, Judge Baum Says CRESCENT CITY TAX: Case Summary & 20 Largest Unsecured Creditors CURTIS DEMILLE CONSTRUCTION: Voluntary Chapter 11 Case Summary DA-LITE SCREEN: S&P Gives Negative Outlook; Affirms 'B' Rating DELPHI CORP: Nears Bankruptcy Exit, Trims Workers DESERT DIAMOND: Involuntary Chapter 11 Case Summary DORAL FINANCIAL: Possible Losses Prompt Moody's to Junk Rating EAST FOURTEEN GARDENS: Voluntary Chapter 11 Case Summary ENABLE HOLDINGS: June 30 Balance Sheet Upside-Down by $5 Million ENERGY XXI: Offers Buyback of Sr. Notes at 80 Cents on Dollar ESSAR STEEL: Term Loan Amendment Permits Covenant Compliance FAIRFAX FINANCIAL: Moody's Upgrades Senior Debt Rating to 'Ba1' FAIRPOINT COMMUNICATIONS: CEO Confirms Potential Bankruptcy Filing FERRELLGAS LP: S&P Assigns 'B+' Rating on $250 Mil. Senior Notes FERRELLGAS PARTNERS: Moody's Gives Stable Outlook; Puts Ba3 Rating FLOYD & BEASLEY: Gas Prices, Unpaid Invoices Causes Ch 11 Bankr. FOAMEX INT'L: Gets October 19 Extension for Bankruptcy Plan FORD MOTOR: Canadian Union Wants Assembly Plant to Remain Open FORMIDABLE LLC: Meeting of Creditors Scheduled for October 1 FORMTECH INDUSTRIES: To Conduct Sept. 29 Auction for All Assets FREMONT GENERAL: Hearing on Outline to Competing Plans Sept. 17 FRONTIER AIRLINES: Ch. 11 Plan Okayed; To Emerge as Republic Unit GENERAL GROWTH: U.S. Trustee Forms 7-Member Equity Committee GENERAL GROWTH: To Auction Off Natick Condo Units October 4 GENERAL MOTORS: Magna's EUR500 Million Offer for Opel Accepted GENERAL MOTORS: Beijing Automotive Joins Koenigsegg's Saab Bid GENERAL MOTORS: Germany Can't Force Early Repayment of Opel Loan GIBSON GUITAR: Moody's Gives Negative Outlook, Affirms 'B2' Rating GLOBAL CROSSING: To Raise $650MM in Private Placement of Sr. Notes GREENWICH STREET: Case Summary & Largest Unsecured Creditor HAIGHTS CROSS: Has Lenders' Support for Chapter 11 Filing, Plan GRAND SEAS RESORT: Files Chapter 11 in Miami GREENWICH STREET DEVELOPERS: Files Chapter 11 in Manhattan HARRAH'S ENTERTAINMENT: Unit Proposes to Issue $720MM of Sr. Notes HARRAH'S OPERATING: S&P Affirms 'B' Rating on Senior Secured Notes HD SUPPLY: Moody's Reviews 'B3' Corporate Family Rating HERCULES CHEMICAL: Files Chapter 11 Plan With Asbestos Trust IDEARC INC: To Begin Soliciting Votes on Amended Plan INLET RETAIL: Inlet Square Sold to Secured Lender Rait INT'L AEROSPACE: Existence Dependent on Halting Recurring Losses IRIDIUM OPERATING: Court Sends Plan to Creditors for Voting JAZZ PHARMACEUTICALS: June 30 Balance Sheet Upside-Down by $89,000 J O AND SONS: Case Summary & 18 Largest Unsecured Creditors JAZZ PRODUCTS: Case Summary & 20 Largest Unsecured Creditors JON J. PETERSON: Inconsistent Bidding Procedures Not Approved KEARNEY CONSTRUCTION: Taps Stichter Riedel as Counsel KEARNEY CONSTRUCTION: Wants to File Schedules by September 25 LANDRY'S RESTAURANTS: Taps Moelis as Financial Advisor; Sale Poss. LANDRY'S RESTAURANTS: S&P Puts 'B' Ratings on CreditWatch Negative LEXICON UNITED: June 30 Balance Sheet Upside-Down by $1 Million LIFE SCIENCES: Consolidated Amended Class Action Filed LINDALE PRIME LAND: Development Parcel Scheduled for Auction LIZ CLAIBORNE: Liquidity More Than Sufficient, CEO Says LOCAL INSIGHT: S&P Assigns 'B' Rating on CreditWatch Negative LOEHMANN'S HOLDINGS: S&P Cuts Corporate Credit Rating to 'CC' MAGNA ENTERTAINMENT: TRAC Wants to Bid for Santa Anita Park MANNEY REALTY: Case Summary & 19 Largest Unsecured Creditors MCGRATH HOTEL: Involuntary Chapter 11 Case Summary MERIDIAN RESOURCE: Gets Forbearance from Lenders; Milestones Set MERUELO MADDUX-845: Real Estate Collapse Causes Chapter 11 Bankr. MIDCONTINENT EXPRESS: Moody's Assigns 'Ba1' Corp. Family Rating MITCHELL BRIDGE: Case Summary & 2 Largest Unsecured Creditors MOHAWK INDUSTRIES: S&P Puts 'BB+' Rating on CreditWatch Negative MORTGAGEBROKERS.COM: June 30 Balance Sheet Upside Down by $1.2MM MOUSSA KARIMI: Case Summary & 13 Largest Unsecured Creditors MOVE WEST LLC: Case Summary & 5 Largest Unsecured Creditors MTI GLOBAL: Has $7.4MM Sub Debt Facility From Wellington MUZAK HOLDINGS: Files Chapter 11 Plan, Has Creditors' Support NAM JIK CHO: Case Summary & 20 Largest Unsecured Creditors NCOAT INC: June 30 Balance Sheet Upside-Down by $857 Million NAVISTAR INT'L: Posts $12 Million Net Loss for Fiscal Q3 NAVISTAR INT'L: Posts $12MM 3rd Quarter Loss, Lowers Guidance NEPHROS INC: Posts $1 Million Net Loss in Six Months Ended June 30 NETWORK COMMUNICATIONS: S&P Junks Corporate Credit Rating NEW FRONTIER BANK: Penny Worley Auctions Tow Trucks & Vehicles NEWPAGE CORP: NP Investor Extends Debt Tender Offer Until Today NEWPAGE CORP: S&P Raises Rating on Subordinated Notes to 'CC' NORTEL NETWORKS: Enterprise Auction Today, Verizon Notes of Pacts NORTEL NETWORKS: Cleary Gottlieb Charges $17.3MM for May-July NORTEL NETWORKS: Gets Court Nod to Enforce PBGC Retirement Pact NORTEL NETWORKS: Proposes Deal With Computer Science NUKOTE INTERNATIONAL: Sues Office Depot for $217 Million NV BROADCASTING: Gets Plan Confirmation After 60 Days OFFICE DEPOT: Sued by Nukote Int'l for $217 Million ONE LAND: Amends List of 20 Largest Unsecured Creditors ORAGENICS INC: June 30 Balance Sheet Upside-Down by $1.2 Million PACIFIC RIM: Says Requirements Cast Doubt on Going Concern PANADERIA RAMOS: Voluntary Chapter 11 Case Summary PHILADELPHIA NEWSPAPERS: Hearing Delayed on Ad Campaign Dispute PHILADELPHIA NEWSPAPERS: Reciprocal Injunction Applies to Everyone PHILMONT SQUARE: Voluntary Chapter 11 Case Summary PLAINFIELD APARTMENTS: Connection With Connolly Properties Probed PLAINS EXPLORATION: Moody's Affirms 'Ba3' Corporate Family Rating PNG VENTURES: Files Chapter 11 With Restructuring Plan PRIMARIS REIT: DBRS Confirms Issuer Rating at 'BB' QUEBECOR WORLD: Centerbridge Has 12% Stake in Reorganized Company READER'S DIGEST: Sec. 341 Meeting of Creditors Set for October 2 READER'S DIGEST: Proposes AlixPartners as Advisor READER'S DIGEST: Proposes Ernst & Young as Auditor READER'S DIGEST: Still Optimistic Despite Bankruptcy RENAISSANCE RESIDENTIAL: Must File Chapter 11 Plan by December 24 RENAISSANCE RESIDENTIAL: Section 341(a) Meeting Set for October 1 RENAISSANCE RESIDENTIAL: Selects Robbins Salomon as Attorney RICHARD LACK: Meeting of Creditors Scheduled for September 14 RICHARD LACK: Wants Schedules Filing Extended Until September 24 RICHARD LACK: Wants to Hire Voisenat Law Office as Counsel ROAN VALLEY LLC: Case Summary & 20 Largest Unsecured Creditors SHERIDAN APARTMENTS: Case Summary & 20 Largest Unsecured Creditors SHERMAG INC: Creditors Accept Plan of Arrangement SKINNY NUTRITIONAL: Posts $1.2MM Net Loss in Qtr. Ended June 30 SMURFIT-STONE: Given Plan Exclusivity Until Jan. 21 STAMFORD CENTER: Wins Approval of Plan, Sees Emergence in Weeks STANDARD PACIFIC: Moody's Assigns 'Caa1' Rating on $200 Mil. Notes STANFORD GROUP: Former Director Indicted for Obstructing Probe SUN-TIMES MEDIA: Sale to Tyree Needs Paycuts for Non-union Workers SUNRISE SENIOR: SCA Lenders Extend Loan Maturity, Relax Covenants T.J. GIESEKER TRUCKING: Case Summary & Largest Unsecured Creditor TAHOE FRIDAY: U.S. Trustee Sets Meeting of Creditors for October 5 TAMPA ENCLAVE: Case Summary & 3 Largest Unsecured Creditors TAVERN ON THE GREEN: Files Chapter 11 After Losing Lease TALECRIS BIOTHERAPEUTICS: Moody's Upgrades Corp. Rating to 'B2' TERRY GRAY: Case Summary & Largest Unsecured Creditor TEXANS CUSO INSURANCE: Case Summary & 11 Largest Unsec. Creditors TIMOTHY HARRISON MORGAN: Case Summary & 8 Largest Unsec. Creditors TLC VISION: Obtains Credit Facility Waiver Until September 30 TOTAL SAFETY: S&P Changes Outlook of 'B-' Rating to Stable TOUSA INC: Exclusivity Period Will End by Sept. 15 TREY RESOURCES: June 30 Balance Sheet Upside-Down by $4.5 Million TRIPLE CROWN: Gabelli Funds, et al., Hold 8.6% Equity Stake TRIPLE CROWN: In Talks With Lenders on Possible Restructuring TXCO RESOURCES: Lien Holders Cry Foul to Transfer of Rights UBS AG: Must Set Aside $35.5MM for Pursuit Partners Lawsuit VALIDUS: AM Best Affirms BB+ Rating on Subordinated Debt VERENIUM CORP: 1-for-12 Reverse Stock Split Becomes Effective VIASYSTEMS INC: New Bank Facility Won't Affect S&P's 'B+' Rating WINDSTREAM CORP: $141 Mil. Deal Won't Affect S&P's 'BB+' Rating WINDSTREAM CORP: Lexcom Merger Won't Affect Moody's Ba2 CFR WILLIAM DEL BIAGGIO: Sentenced to More Than 8 Years in Prison WL HOMES: Sale of Assets to Emaar Expected to Closed by Sept. 30 WOLVERINE FIRE: Case Summary & 20 Largest Unsecured Creditors XIOM CORP: June 30 Balance Sheet Upside-Down by $912,000 YL WEST 87TH HOLDINGS: Voluntary Chapter 11 Case Summary * FDIC to End Debt Guarantee Program on October 31 * Pre-Pack Restructurings Rise After Lehman, Says Allen & Overy * BOOK REVIEW: An Entrepreneurial History of the United States ********* AGILENT TECHNOLOGIES: Note Issuance Won't Affect Moody's Ratings ---------------------------------------------------------------- Moody's Investors Service said that Agilent Technologies, Inc.'s announcement that it intends to issue an undisclosed amount of senior notes for general corporate purposes, which could include the partial financing of its pending $1.5 billion acquisition of Varian, will have no impact on the Ba1 corporate family, probability of default and senior unsecured ratings; positive outlook; or SGL-1 liquidity rating. The most recent public commentary on Agilent was on July 27, 2009, when Moody's commented that Agilent's ratings were unaffected by the Varian acquisition announcement. The last rating action on Agilent was on July 14, 2008, when Moody's affirmed the company's ratings and revised the outlook to positive from stable in light of Agilent's execution of its business model and solid financial performance. Headquartered in Santa Clara, California, Agilent is a leading measurement technology company serving the communications, electronics, life sciences, and chemical analysis industries. Net revenues for the twelve months ended July 31, 2009 were $4.8 billion. AMERICAN MEDICAL: S&P Affirms Corporate Credit Rating at 'BB-' -------------------------------------------------------------- Standard & Poor's Ratings Services said that it affirmed its ratings, including its 'BB-' corporate credit rating, on Minnetonka, Minnesota-based American Medical Systems Inc., and revised the outlook to positive from stable. AMS is the wholly owned operating subsidiary of American Medical Systems Holdings Inc. "Our speculative-grade rating on AMS reflects the company's significant financial risk profile, the challenge of improving the performance of the laser therapy business, and its narrow medical focus," said Standard & Poor's credit analyst Cheryl Richer. These risks outweigh AMS' leading positions in its niche markets in men's and women's pelvic health products, which represent, respectively, 68% and 32% of sales. AMERICAN TONERSERV: Files Information Sheet With SEC ---------------------------------------------------- American TonerServ Corp. filed with the Securities and Exchange Commission an information sheet for investors. The Information sheet provides an overview of the Company and slide presentations on ATS's market opportunities, competitive pricing advantage, product and service offerings, growth initiatives, sales partner program and financials, among others. A full-text copy of the Information sheet is available at no charge at http://ResearchArchives.com/t/s?4496 As reported by the Troubled Company Reporter on September 8, 2009, the Company will hold its Annual Meeting of Stockholders at the Santa Rosa Golf and Country Club, Santa Rosa, California, on September 24, 2009, at 2:30 p.m. (PDT) for these purposes: 1. To elect six directors; 2. To consider and vote upon the ratification of the appointment of Perry-Smith LLP as the independent registered public accounting firm for ATS for the fiscal year ending December 31, 2009; and 3. To transact other business as may be properly brought before the meeting and any adjournments thereof. Stockholders of the Company of record at the close of business on August 26, 2009, are entitled to vote at the meeting and all adjournments thereof. A full-text copy of the proxy statement is available at no charge at http://ResearchArchives.com/t/s?4440 American TonerServ is seeking to renegotiate the terms of a portion of its short term note obligations or to exchange equity securities for a portion of the debt. At June 30, 2009, the Company had a working capital deficit of $3,846,017, including cash and equivalent balances of $25,836 compared to a working capital deficit of $4,973,437 at December 31, 2008. The deficit is primarily related to short term note obligations which are due over the next 12 months. As of June 30, 2009, the Company had $16.7 million in total assets and $13.5 million in total liabilities. The Company's June 30 balance sheet showed strained liquidity with $5.03 million in total current assets against $8.88 million in total current liabilities. The Company believes that it will be successful in addressing its short term working capital requirements through various strategies. In a regulatory filing with the Securities and Exchange Commission in August, the Company said it has inadequate financial resources to sustain its business activities as they currently are. Management believes that the Company can achieve positive cash flow through an aggressive organic growth plan to increase sales, increasing operational efficiencies and by aggressively reducing overhead costs. During the six months ended June 30, 2009, the Company raised $360,000 in proceeds from private offerings. The Company estimates that it will need to raise an additional $1,000,000 during the next 12 months to meet its minimum capital requirements. There is substantial doubt that the Company will be able to continue as a going concern, absent raising additional financing. There can be no assurance that the Company will be successful in obtaining the required financing or renegotiating terms or converting a portion of its short term obligations into equity. About American TonerServ American TonerServ Corp. -- http://www.AmericanTonerServ.com/-- markets compatible toner cartridges, serving the printing needs of small- and medium-sized businesses by consolidating best-in-class independent operators in the more than $6.0 billion recycled printer cartridge and printer services industry, offering top- quality, environmentally-friendly products and local service teams. ANDRE REVELEY: Case Summary & 12 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Andre D. Reveley 12535 Perrywood Lane Dunkirk, MD 20754 Bankruptcy Case No.: 09-26922 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court District of Maryland (Greenbelt) Judge: Paul Mannes Debtor's Counsel: Richard H. Gins, Esq. The Law Office of Richard H. Gins, LLC 3 Bethesda Metro Center, Suite 530 Bethesda, MD 20814 Tel: (301) 718-1078 Fax: (301) 718-8359 Email: richard@ginslaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 12 largest unsecured creditors is available for free at: http://bankrupt.com/misc/mdb09-26922.pdf The petition was signed by Mr. Reveley. APPLETON PAPERS: Extends Exchange Offer Deadline to September 16 ---------------------------------------------------------------- Appleton Papers Inc. on September 8, 2009, said it is extending the consent date and the expiration date for its private note exchange offers and consent solicitations. Appleton has offered, subject to certain conditions, to exchange new 11.25% Second Lien Notes due 2015 for its existing 8.125% Senior Notes due 2011 and 9.75% Senior Subordinated Notes due 2014. As extended, the consent date for the offers will be 5:00 p.m., New York City time, on September 9, 2009, and the expiration date for the offers will be 12:00 midnight, New York City time, on September 16, 2009 (in each case unless further extended). One of the conditions to the exchange offers and consent solicitations is the receipt of consent from the lenders under Appleton's existing senior credit facility to allow Appleton to exchange the Old Notes for the New Notes. Appleton currently anticipates that approval, if obtained, will be in the form of an amendment to the Credit Facility that would also provide for other matters, including: -- a permanent reduction of revolving commitments by $30.0 million according to this schedule: * $5 million at December 31, 2009; * $10 million at March 31, 2010; and * $15 million at June 30, 2010; -- the revision of certain ratios and covenants contained in the Credit Facility (including the revision of provisions regarding asset dispositions and extraordinary receipts in a manner that would expand the circumstances under which prepayment of amounts under the Credit Facility would be required); -- permitting less than 100%, but greater than 50%, ownership of Paperweight Development Corp. by the Appleton Papers Retirement Savings and Employee Stock Option Plan; -- an increase in pricing of the term loans; and -- payment to the Lenders consenting to the amendment of a fee based on their final commitment at the time of effectiveness of the amendment. As of 5:00 p.m., New York City time, on September 4, 2009, Appleton had received tenders of Old Notes representing approximately 77% of the outstanding aggregate principal amount of the 8.125% Senior Notes due 2011 and approximately 77% of the outstanding aggregate principal amount of the 9.75% Senior Subordinated Notes due 2014. The exchange offers and consent solicitations are being made only to qualified institutional buyers and accredited investors inside the United States and to certain non-U.S. investors located outside the United States that have completed and returned a related letter of representations. The terms and conditions of the exchange offers and consent solicitations are described in the Offering Circular and related Letter of Transmittal and Consent, dated August 18, 2009. Except as noted, the terms and conditions of the exchange offers and consent solicitations remain unchanged. All holders of old notes who have previously tendered old notes and delivered related consents do not need to retender such old notes or redeliver such related consents or take any other action in response to this extension. Other qualified holders of old notes may use the materials previously distributed to them for purposes of tendering old notes and delivering related consents. Distressed Exchange As reported by the Troubled Company Reporter on August 20, 2009, Standard & Poor's Ratings Services lowered its corporate credit rating on Appleton Papers to 'CC' from 'B'. At the same time, S&P lowered the issue-level ratings on the company's senior notes and subordinated notes to 'C' from 'CCC+'. The outlook is negative. S&P also placed 'B+' issue-level rating on the Company's secured bank credit facilities on CreditWatch with negative implications. The recovery rating remains '2', indicating S&P's expectation of substantial (70% to 90%) recovery in the event of payment default. The rating actions follow Appleton's announcement that it is offering to exchange $200 million of proposed new second-lien secured notes for the outstanding senior unsecured and subordinated notes in its capital structure. In the case of the subordinated notes, the exchange for the new notes would represent a substantial discount to the par amount. For the senior unsecured notes, the exchange for the new notes would be at par, while the maturity would be extended beyond the original maturity of the existing notes. "As a result, S&P view the exchanges as being tantamount to default given Appleton's stressed and highly leveraged financial risk profile and S&P's concerns around Appleton's ability to service its current capital structure over the intermediate term due to the challenging operating environment," said Standard & Poor's credit analyst Andy Sookram. The TCR also said Moody's Investors Service assigned a B3 rating to Appleton Papers' proposed new secured notes due 2015 and downgraded the company's existing senior subordinated notes to Ca from Caa1. At the same time, Moody's downgraded the company's probability of default rating to Caa3 from B2. Moody's also affirmed the company's B2 corporate family rating and speculative grade liquidity rating of SGL-4. The outlook remains negative. Because the exchange offer for the senior subordinated debt is being done at 60% of par, and nonconsenting holders of the existing senior unsecured and senior subordinated notes will lose certain rights and be effectively subordinated to the new notes, Moody's views the exchange offer to be a distressed exchange, which is an event of default under Moody's definition of default. About Appleton Papers Appleton Papers Inc., headquartered in Appleton, Wisconsin, develops and manufactures specialty coated paper products, including carbonless paper, thermal paper, and other specialty papers. It also develops and manufactures flexible packaging products. ARTHUR GAMBOA: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Joint Debtors: Arthur B. Gamboa Consuelo Gamboa 1024 Hetrick Avenue Arroyo Grande, CA 93420 Bankruptcy Case No.: 09-13681 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Central District of California (Santa Barbara) Judge: Robin Riblet Debtors' Counsel: Michael Jay Berger, Esq. 9454 Wilshire Blvd 6th Flr Beverly Hills, CA 90212-2929 Tel: (310) 271-6223 Fax: (310) 271-9805 Email: michael.berger@bankruptcypower.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/cacb09-13681.pdf The petition was signed by the Joint Debtors. ARVINMERITOR INC: Files Copies of GMAC Receivables Deal ------------------------------------------------------- ArvinMeritor, Inc., filed with the Securities and Exchange Commission copies of: -- Loan and Security Agreement dated as of September 8, 2009, among ArvinMeritor Receivables Corporation, ArvinMeritor, Inc., GMAC Commercial Finance LLC, and the Lenders from time to time party thereto. See http://ResearchArchives.com/t/s?448e -- Third Amended and Restated Purchase and Sale Agreement dated as of September 8, 2009, among ArvinMeritor Receivables Corporation and Meritor Heavy Vehicle Braking Systems (U.S.A.), Inc. and Meritor Heavy Vehicle Systems LLC See http://ResearchArchives.com/t/s?448f As reported by the Troubled Company Reporter, on September 8, 2009, ArvinMeritor, in anticipation of the expiration of its existing accounts receivable securitization arrangement, entered into a new, two-year U.S. receivables financing arrangement. The New Facility contemplates that ArvinMeritor Receivables Corporation, a subsidiary of ArvinMeritor, will purchase eligible accounts receivable from certain other ArvinMeritor subsidiaries and will borrow under a credit facility funded by multiple lenders. ARC's borrowings will be secured by an interest in the purchased receivables, and ARC will use the proceeds of the borrowings to fund purchases of receivables from the Originators. The purchased receivables under the New Facility are expected to be substantially similar to those under the facility it replaces. Management of ArvinMeritor said on August 4, 2009, that, based on discussion with lenders and progress to date, it expected to replace its U.S. securitization program by the end of August. The current U.S. securitization program does not expire until September 14, 2009. In connection with the New Facility, ARC entered into a Loan Agreement with ArvinMeritor, as Initial Collection Agent, the Lenders from time to time party thereto and GMAC Commercial Finance LLC, as Agent, providing for borrowings by ARC in an aggregate principal amount outstanding at any one time of not to exceed $105 million (which may be increased with the Agent's consent to $125 million upon the identification of a new or existing Lender willing to provide such additional commitment), secured by an interest in accounts receivable of the Originators sold to ARC from time to time pursuant to a Third Amended and Restated Purchase and Sale Agreement among ARC and the Originators. Borrowings under the New Facility will be subject to a borrowing base formula that provides for an 80% advance rate against eligible receivables less certain reserves. Borrowings under the New Facility will bear interest at a rate equal to an applicable margin plus, at ARC's option, either (a) a base rate determined by reference to the higher of (1) JPMorgan Chase Bank's prime rate, (2) the federal funds rate plus 1/2 of 1% and (3) three-month LIBOR plus 1.00% or (b) LIBOR. For purposes of determining the appropriate interest rate, LIBOR will be no less than 3.00%. The applicable margin for the New Facility will be 3.50% plus the Base Rate or 4.50% plus the LIBOR rate, as the case may be. The commitment fee on the undrawn amounts under the facility will be 1.00%. As of the closing date, availability under the New Facility is expected to exceed availability under the facility it replaces. The New Facility, like the previously existing accounts receivable securitization arrangement, contains a number of covenants customary for this type of facility, including a cross-default to ArvinMeritor's senior secured credit facility. Baker & Daniels LLP represents ArvinMeritor under the Loan and Security Agreement: Baker & Daniels LLP 300 North Meridian Street, Suite 2700 Indianapolis, Indiana 46204-1782 Telephone: (317) 237-1189 Telecopier: (317) 237-1000 Attn: Rebecca A. Richardson, Esq. Honigman Miller Schwartz and Cohn LLP represents GMAC Commercial Finance LLC under the Agreement: Honigman Miller Schwartz and Cohn LLP 660 Woodward Avenue 2290 First National Building Detroit, Michigan 48226-3506 Attn: Donald F. Baty, Jr. Esq. Fax/Telecopy No: (313) 465-7315 About ArvinMeritor Inc. ArvinMeritor, Inc. -- http://www.arvinmeritor.com/-- is a premier global supplier of a broad range of integrated systems, modules and components to the motor vehicle industry. The company marks its centennial anniversary in 2009, celebrating a long history of 'forward thinking.' The company serves commercial truck, trailer and specialty original equipment manufacturers and certain aftermarkets, and light vehicle manufacturers. ArvinMeritor common stock is traded on the New York Stock Exchange under the ticker symbol ARM. In August, Fitch Ratings said it is keeping ArvinMeritor's issuer default rating at 'CCC' on Rating Watch Negative. AVAGO TECH: Offers 95 Cents on Dollar for Floating Rate Notes ------------------------------------------------------------- Avago Technologies Limited's wholly owned subsidiary, Avago Technologies Finance Pte. Ltd. commenced a cash tender offer to purchase up to $250 million aggregate principal amount of its outstanding notes as described below. The tender offer is described in an offer to purchase, dated September 3, 2009 and related Letter of Transmittal. Avago Finance reserves the right to increase the Maximum Tender Amount subject to compliance with applicable law. The company expects to use net proceeds from the previously completed initial public offering of Avago Technologies Limited's ordinary shares and cash on hand to purchase the outstanding notes. Upon the terms and subject to the conditions described in the Offer to Purchase and the Letter of Transmittal, and any amendments or supplements to the foregoing, Avago Finance is offering to purchase for cash the notes below in the following Acceptance Priority Level: Aggregate Tender Principal Consideration Title of CUSIP Amount Per $1,000 Securities Number Outstanding Principal Amount ---------- ------ ----------- ---------------- 11-7/8% Senior Subordinated Notes due 2015 05336XAF8 $247,500,000 $1,065.00 $20.00* --------- $1,085.00 10-1/8% Senior Notes due 2013 05336XAD3 $403,121,000 $1,035.00 U05212AA0 $20.00* --------- $1,055.00 Senior Floating Rate Notes due 2013 05336XAE1 $50,000,000 $930.00 $20.00* --------- $950.00 * early tender premium The tender offer will expire at 12:00 midnight, New York City time, on October 1, 2009, unless extended or earlier terminated. Holders of notes that are validly tendered at or prior to 5:00 p.m., New York City time, on September 17, 2009 and accepted for purchase will receive the Tender Offer Consideration for such series, plus the applicable early tender premium set forth in the table above. Holders of notes validly tendered after the Early Tender Date but before the Expiration Date and accepted for purchase will receive the applicable Tender Offer Consideration, but not the Early Tender Premium. All holders of notes who validly tender their notes on or before the Expiration Date and whose notes are accepted for purchase will receive the applicable consideration set forth in the table above, plus accrued and unpaid interest from the last interest payment date to, but not including, the payment date. If notes are validly tendered in the tender offer such that the aggregate principal amount tendered exceeds the Maximum Tender Amount, Avago Finance will accept for purchase, up to the Maximum Tender Amount, notes in accordance with the Acceptance Priority Level in numerical priority order. Avago Finance will apply the Maximum Tender Amount first to purchase the 11-7/8% Notes. To the extent any amounts remain in the Maximum Tender Amount after Avago Finance purchases the 11-7/8% Notes, Avago Finance will then apply the balance to purchase the 10-1/8% Notes, subject to proration, if applicable, based on the aggregate principal amount of the 10- 1/8% Notes validly tendered, rounded down to the nearest integral multiple of $1,000. To the extent any amounts remain in the Maximum Tender Amount after Avago Finance purchases the 11-7/8% Notes and the 10-1/8% Notes, Avago Finance will then apply the balance to purchase the Floating Rate Notes, subject to proration, if applicable, based on the aggregate principal amount of the Floating Rate Notes validly tendered, rounded down to the nearest integral multiple of $1,000. Payment for the 11-7/8% Notes validly tendered at or before the Early Tender Date and accepted for purchase is expected to be made promptly after the Early Tender Date. Payment for (a) the 11-7/8% Notes validly tendered after the Early Tender Date and at or before the Expiration Date and accepted for purchase, and (b) the 10-1/8% Notes and the Floating Rate Notes validly tendered at or before the Expiration Date and accepted for purchase is expected to be made promptly after the Expiration Date. Tenders of the notes may be withdrawn at any time at or prior to 5:00 p.m., New York City time, on September 17, 2009, but may not be withdrawn thereafter. The consummation of the tender offer is not conditioned upon any minimum amount of notes being tendered, but is conditioned upon the satisfaction or waiver of the conditions set forth in the Offer to Purchase. Citi is the sole dealer manager of the tender offer. Global Bondholder Services Corporation has been retained to serve as the depositary and information agent. None of Avago Finance or its affiliates, its board of directors, the dealer manager, the depositary and information agent or the trustee for the notes, makes any recommendation as to whether holders of the notes should tender or refrain from tendering the notes. About Avago Technologies Headquartered both in San Jose, California, and in Singapore, Avago Technologies Holdings Pte. Ltd. -- http://www.avagotech.com/ -- is a semiconductor company, with approximately 6,500 employees worldwide. Avago provides an extensive range of analog, mixed-signal and optoelectronic components and subsystems to more than 40,000 customers. The company's products serve four end markets: industrial and automotive, wired networking, wireless communications, and computer peripherals. Worldwide Design, Manufacturing and Marketing Centers in the United States, Italy, Germany, Singapore, Korea, China, Japan and Malaysia. Avago Technologies is the successor to the Semiconductor Products Group of Agilent. Avago Technologies purchased the business of SPG as of December 1, 2005, for US$2.6 billion in cash. Avago Technologies had total assets of $1,775,000,000 against debts of $1,017,000,000 as of August 2, 2009. * * * As reported by the Troubled Company Reporter-Asia Pacific on Jan. 11, 2008, Standard & Poor's Ratings Services removed its ratings on San Jose, Calif.- and Singapore-based Avago Technologies Finance Pte. Ltd. and related entities, from CreditWatch, where they were placed on Sept. 19, 2007, with positive implications, and raised the company's corporate credit rating to 'BB-' from 'B'. AVIS BUDGET: Shapiro Capital Unloads Equity Stake ------------------------------------------------- Shapiro Capital Management LLC said in a regulatory filing it has ceased to be a beneficial owner of Avis Budget Group Inc. common shares. As of August 31, 2009, Shapiro Capital has unloaded all of the Avis Budget shares it held. Avis Budget Group -- http://www.avisbudgetgroup.com/-- provides vehicle rental services, with operations in more than 70 countries. Through its Avis and Budget brands, the Company is a general-use vehicle rental company in each of North America, Australia, New Zealand and certain other regions based on published airport statistics. Avis Budget Group is headquartered in Parsippany, N.J. and has roughly 24,000 employees. * * * As reported by the Troubled Company Reporter on April 30, 2009, Standard & Poor's Ratings Services assigned a '6' recovery rating to Avis Budget Car Rental LLC's (CCC+/Developing/--) unsecured notes, indicating expectations of negligible (0%-10%) recovery of principal in the event of a payment default. Avis Budget Car Rental LLC is a subsidiary of Avis Budget Group Inc. (CCC+/Developing/--). BACCHUS DEV'T: In Default of Union Bank Loans; Files for Ch 11 -------------------------------------------------------------- Bacchus Development and its two affiliates have filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Central District of California. Mark Mueller at the Orange County Business Journal reports that Bacchus said that it sought for bankruptcy protection after its largest lender, Union Bank, declared $55 million worth of loans tied to the Company's two most recent projects to be in default. Union Bank, says the report, filed lawsuits against Bacchus. Bacchus' chief financial officer Stephen Muller said in a statement that the Debtors filed for bankruptcy "to obtain a breathing spell within which to reorganize (the company's) affairs". According to Business Journal, Bacchus Commercial LLC -- the largest of the three bankruptcy filers -- listed $50 million to $100 million in debts. Bacchus Commercial owes The Irvine Co. about $465,000, says Business Journal. The report states that Bacchus Investment Group LLC, the other filer, owes the city of Irvine some $1.3 million. Business Journal states that the three bankruptcy cases are being handled by Winthrop Couchot Professional Corp. Court documents say that more than 40 of 90 buildings at Bacchus' Jeffrey Office Park and Bacchus Signature Series remain unsold. Bacchus Development is based in Irvine, California. BALQON CORPORATION: Posts $758,000 Net Loss in Qtr. Ended June 30 ----------------------------------------------------------------- Balqon Corporation posted a net loss of $757,994 for three months ended June 30, 2009, compared with a net loss of $5,261,142 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss of $1,360,521 compared with a net loss of $5,317,382 for the same period in 2008. At June 30, 2009, the Company's balance sheet showed total assets of $4,073,016, total liabilities of $3,778,545 and a stockholders' equity of $294,471. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4489 About Balqon Corporation Balqon Corporation (OTC:BLQN) fka BMR Solutions, Inc., develops, assembles and markets heavy-duty electric vehicles, flux vector inverters, and heavy-duty electric drive systems. The Company sells its heavy-duty electric vehicles. During the year ended Dec. 31, 2008, 63% of its revenues were associated with the AQMD Development Agreement. During 2008, the remaining 37% of revenues were from the sale of parts to the Port of Los Angeles. On October 24, 2008, the Company completed an Agreement and Plan of Merger with Balqon Corporation and its wholly owned subsidiary Balqon Acquisition Corp. Upon the closing of the Merger Agreement Balqon California merged with and into Acquisition Subsidiary with Acquisition Subsidiary surviving, and immediately thereafter, Acquisition Subsidiary merged with and into the Company. On March 23, 2009, Weinberg & Company, P.A., in Los Angeles, California, expressed substantial doubt about Balqon's ability to continue as a going concern after auditing the Company's financial statements for the fiscal years ended Dec. 31, 2008, and 2007. The auditor noted that the Company experienced recurring losses since inception and has an accumulated deficit. BARZEL INDUSTRIES: Nasdaq to Delist Shares Effective Sept. 18 ------------------------------------------------------------- The Nasdaq Stock Market, Inc., has determined to remove from listing the common stock of Barzel Industries Inc., effective at the opening of the trading session on September 18, 2009. Based on a review of the information provided by the Company, Nasdaq Staff determined that the Company no longer qualified for listing on the Exchange pursuant to Listing Rule 5550(b). The Company was notified of the Staffs determination on August 11, 2009. The Company did not appeal the Staff determination to the Hearings Panel, and the Staff determination to delist the Company became final on August 20, 2009. About Barzel Industries Headquartered in Norwood, Massachusetts, with an operational hub in Mississauga, Ontario, Barzel Industries Inc. (NASDAQ: TPUT, TPUTW) operates a network of 15 manufacturing, processing and distribution facilities in the United States and Canada. The Company offers a wide range of metal solutions to a variety of industries, from construction and industrial manufacturing to transportation, infrastructure development and mining. The Company has obtained a deferral to October 13, 2009 of payment of interest on its 11.5% Senior Secured Notes due 2015 in the aggregate principal amount of $315 million. Under the deferral agreement, the Company agreed to use its best efforts to consummate a debt or equity recapitalization or restructuring, a debt refinancing, a capital raising transaction, or a sale of its equity securities or its assets. The Company has retained an independent third party investment banker to assist in connection therewith. The Company has determined that it is in the best interests of the corporation to devote its full management resources to completing such a transaction. BASHAS' INC: To Close Food City in Arizona This Week ---------------------------------------------------- Ainslee S. Wittig at Arizona Range News reports that Bashas' Inc. will close its Food City unit in Arizona this week. Arizona Range News quoted Hill Grocery Inc. General Manager Everett Vaughan as saying, "Arrangements have been made to keep the doors open, serve our customers and keep our employees working during this transition period . . . . We are currently in the process of acquiring the licensing and permits to do business in Arizona, and we anticipate opening in Willcox in October. We hope to retain most of the good folks that Food City employs and will offer current employees an interview." Bashas' Inc. is a 77-year-old grocery chain that owns 158 retail stores located throughout Arizona. It is doing business as National Grocery, Bashas Food, Bashas' United Drug, Food City, Eddie's Country Store, A,.J. Fine Foods, Western Produce, Bashas' Distribution Center, Sportsman's, and Bashas' Dine. The Company and its affiliates filed for Chapter 11 bankruptcy protection on July 12, 2009 (Bankr. D. Ariz. Case No. 09-16050). Frederick J. Petersen, Esq., at Mesch, Clark & Rothschild, P.C., assists the Debtors in their restructuring efforts. Michael W. Carmel, Ltd., is the Debtors' co-counsel. Deloitte Financial Advisory LLP serves as financial advisors. Epiq Bankruptcy Solutions, LLC, serves as claims and notice agent. In its bankruptcy petition, Bashas' listed $100,000,001 to $500,000,000 in assets and $100,000,001 to $500,000,000 in debts. BELK PROPERTIES LLC: Voluntary Chapter 11 Case Summary ------------------------------------------------------ Debtor: Belk Properties, LLC P.O. Box 845 Oxford, MS 38655 Bankruptcy Case No.: 09-14656 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Northern District of Mississippi (Aberdeen) Judge: David W. Houston, III Debtor's Counsel: Joyce Freeland, Esq. P.O. Box 269 Oxford, MS 38655 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 Frank Belk, member/manager of the Company. BERNARD MADOFF: Two NY & Florida Properties Put on Sale ------------------------------------------------------- Juliet Chung at The Wall Street Journal reports that Bernard Madoff's two remaining federally seized properties in New York and Palm Beach, Florida, were listed Thursday for $9.9 million and $8.5 million, respectively. The Journal relates that money from the sale of the Madoff residences goes into a fund that will be used to reimburse the victims of Mr. Madoff's Ponzi scheme. According to the report, the listing agents start showing the duplex Friday and have taken appointments on it. The Journal states that listing agents Jim McCann of Corcoran Group said that he planned start showing the Palm Beach property Thursday night. More than a dozen qualified buyers have expressed interest, the report says, citing Mr. McCann. According to The Journal, Mr. Maddof's oceanfront home in Montauk, on New York's Long Island, was listed on September 1 for $8.75 million. Listing agent Joan Hegner's spokesperson said that four offers have been made for the Montauk property, The Journal relates. Citing the Marshals Service, The Journal reports that Mr. Madoff's three boats would be auctioned off in Fort Lauderdale, Florida, on November 17. 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 Mr. Madoff's fraud were allegedly at least US$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. As reported by the TCR, Judge Denny Chin of the U.S. District Court for the Southern District of New York on June 29, 2009, sentenced Mr. Madoff to 150 years of life imprisonment for defrauding investors. CABLEVISION SYSTEMS: Moody's Puts 'B1' Rating on $500 Mil. Notes ---------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to Cablevision Systems Corporation's proposed $500 million offering of senior unsecured notes due 2017. Net proceeds from the issuance will be used to fund Cablevision's concurrent tender offer for subsidiary CSC Holdings Inc.'s senior unsecured notes due 2011 and 2012. "The refinancing extends and modestly improves Cablevision's debt maturity profile, continuing a recent trend towards more prudent balance sheet management," noted Moody's Senior Vice President Russell Solomon. LGD point estimates for both Cablevision's and CSC's debts were updated to reflect the expected debt mix and could change if the deal is upsized. The rating outlook is stable. Assignment: Issuer: Cablevision Systems Corporation -- Senior Unsecured Regular Bond/Debenture, Assigned B1 (LGD6- 92%) Moody's last rating action on Cablevision was on May 20, 2009, when it upgraded the company's Corporate Family and Probability of Default Ratings, each to Ba2 from Ba3. Headquartered in Bethpage, New York, Cablevision Systems Corporation is predominantly a domestic cable TV multiple system operator serving approximately 3.1 million subscribers in and around the New York metropolitan area. Among other entertainment- and media-related business ventures, the company also owns and distributes programming to cable television and direct broadcast satellite providers throughout the United States through its Rainbow National Services subsidiary. CABLEVISION SYSTEMS: S&P Assigns 'B+' Rating on $500 Mil. Notes --------------------------------------------------------------- Standard & Poor's Ratings Services said it assigned its 'B+' issue-level and '6' recovery ratings to Cablevision Systems Corp.'s proposed $500 million senior notes due 2017. The '6' recovery rating indicates the expectation for negligible (0%-10%) recovery of principal in the event of payment default. The 'BB+' rating on $650 million of secured bank debt at majority- owned Newsday LLC remains on CreditWatch with negative implications, reflecting concerns regarding recovery prospects for this issue given the secular decline of the newspaper industry. S&P affirmed all other ratings on Cablevision and related entities, including the 'BB' corporate credit rating. Bethpage, N.Y.-based Cablevision is a major cable operator in the New York metropolitan area with almost $11.8 billion of debt reported outstanding at June 30, 2009. The outlook is negative. The proposed notes will be sold under Rule 144A with registration rights. All, or most, issue proceeds will be downstreamed to subsidiary CSC Holdings Inc., which will repay or repurchase some of its notes maturing in 2011 and 2012. "The ratings on Cablevision reflect S&P's expectation that the company may well choose to pursue its historic, aggressive financial policy," said Standard & Poor's credit analyst Richard Siderman, "a factor that overshadows its investment-grade business risk profile." CANWEST GLOBAL: Unit Has Sale Deal with Local Investor Group ------------------------------------------------------------- Canwest Global Communications Corp. said its subsidiary, Canwest Television Limited Partnership, has entered into an agreement to sell CHEK-TV in Victoria to a local investor group. For a nominal purchase price that was not disclosed, the LIG will take ownership of the conventional television station's assets. The change of control and issuance of a new license is conditional on Canadian Radio-television and Telecommunications Commission approval. The LIG intends to file an application with the CRTC requesting the transfer of ownership of the station license as soon as possible. Canwest has agreed to provide transitional support services and leased space in the CHEK station building at favorable rates in order to ensure a smooth transition and to facilitate the sale. "Many dedicated individuals on both sides of the table came together and the result is that it has preserved jobs and service in the community," said Leonard Asper, President and CEO of Canwest. "One week ago, we thought that this station was going to close and today we have a result that is beneficial for all parties." Mr. Asper added, "The real winners are the people of Vancouver Island and the Lower Mainland who will continue to receive this valuable local service." CHEK is a conventional television station with about 45 employees that services Victoria and the Vancouver Island region. About Canwest Global Canwest Global Communications Corp. -- http://www.canwest.com/-- (TSX: CGS and CGS.A,) an international media company, is Canada's largest media company. In addition to owning the Global Television Network, Canwest is Canada's largest publisher of English language daily newspapers and owns, operates and/or holds substantial interests in conventional television, out-of-home advertising, specialty cable channels, web sites and radio stations and networks in Canada, New Zealand, Australia, Turkey,Indonesia, Singapore, the United Kingdom and the United States. At May 31, 2009, Canwest Media had C$4,847,020,000 in total assets and C$5,826,522,000 in total liabilities. * * * As reported in the Troubled Company Reporter on June 9, 2009, Moody's Investors Service downgraded Canwest Limited Partnership's probability of default rating to Ca/LD and its corporate family to Caa3 after the Company failed to pay $10 million due under its senior secured credit facility on May 29, 2009, the end of the company's fiscal quarter. This suggests that CLP has chosen to force the issue with its bank lenders, and is also likely an indication that ongoing negotiations with the bank lenders were not going well, according to Moody's. Since the payment includes a principal component and there is no cure period, the bank credit facility is now in default. The lenders have not accelerated repayment. The TCR on June 2, 2009, said Standard & Poor's Ratings Services lowered its ratings on Canwest LP, including the corporate credit and senior secured ratings to 'D' (default) from 'CCC' and the rating on the C$75 million senior subordinated credit facility due 2015 to 'D' from 'CC'. S&P also lowered the rating on the Company's US$400 million senior subordinated notes due 2015 to 'C' from 'CC'. CANWEST LIMITED: Reaches Forbearance Pact With Senior Lenders ------------------------------------------------------------- Canwest Global Communications Corp. announced September 10 that its subsidiary, Canwest Limited Partnership, has entered into a forbearance agreement with lenders under its senior secured credit facility while they continue discussions regarding the framework for a potential recapitalization transaction. Under the terms of the forbearance agreement, the senior lenders have agreed not to enforce their rights under the senior credit facility arising from the Limited Partnership's previously announced defaults prior to October 31, 2009. The Limited Partnership has agreed to pay all outstanding interest and fees due under the senior credit facility and the associated hedging agreements and to resume paying interest and fees due and payable under such agreements during the forbearance period. The forbearance agreement is subject to the satisfaction of certain milestones including reaching an agreement on the principal terms of a recapitalization transaction by September 30, 2009. The Limited Partnership has also commenced discussions with representatives of an ad hoc committee of noteholders of the Limited Partnership's 9.25% senior subordinated notes due 2015. About Canwest Global Canwest Global Communications Corp. -- http://www.canwest.com/-- (TSX: CGS and CGS.A,) an international media company, is Canada's largest media company. In addition to owning the Global Television Network, Canwest is Canada's largest publisher of English language daily newspapers and owns, operates and/or holds substantial interests in conventional television, out-of-home advertising, specialty cable channels, web sites and radio stations and networks in Canada, New Zealand, Australia, Turkey,Indonesia, Singapore, the United Kingdom and the United States. Canwest Limited Partnership owns and operates 12 daily newspapers, 23 community newspapers, more than 80 online operations as well as other publications and national services. It does not include the National Post newspaper or its related online operations. At May 31, 2009, Canwest Media had C$4,847,020,000 in total assets and C$5,826,522,000 in total liabilities. * * * As reported in the Troubled Company Reporter on June 9, 2009, Moody's Investors Service downgraded Canwest Limited Partnership's probability of default rating to Ca/LD and its corporate family to Caa3 after the Company failed to pay $10 million due under its senior secured credit facility on May 29, 2009, the end of the company's fiscal quarter. This suggests that CLP has chosen to force the issue with its bank lenders, and is also likely an indication that ongoing negotiations with the bank lenders were not going well, according to Moody's. Since the payment includes a principal component and there is no cure period, the bank credit facility is now in default. The lenders have not accelerated repayment. The TCR on June 2, 2009, said Standard & Poor's Ratings Services lowered its ratings on Canwest LP, including the corporate credit and senior secured ratings to 'D' (default) from 'CCC' and the rating on the C$75 million senior subordinated credit facility due 2015 to 'D' from 'CC'. S&P also lowered the rating on the Company's US$400 million senior subordinated notes due 2015 to 'C' from 'CC'. CARAUSTAR INDUSTRIES: S&P Withdraws 'D' Corporate Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings, including its 'D' corporate credit rating, on Austell, Georgia-based recycled paperboard and converted paperboard products manufacturer, Caraustar Industries Inc. per the company's request. The company emerged from Chapter 11, which it previously filed voluntary petitions under on May 31, 2009, bankruptcy protection as a reorganized private company. CARUSO HOMES: Exits Chapter 11 Bankruptcy Protection ---------------------------------------------------- Building Online reports that Caruso Homes has emerged from Chapter 11 bankruptcy protection. According to Building Online, Caruso Homes President Jeffrey Caruso said that he will be able to remobilize the Company with minimal personal and corporate debt and a strong balance sheet. Building Online relates that Caruso Homes will immediately start selling seven communities out of two regional models in the Maryland suburbs of Washington DC. Headquartered in Crofton, Maryland, Caruso Homes Inc. -- http://www.carusohomes.com/-- is a custom home builder in Maryland and Virginia. The Company and 24 of its debtor- affiliates filed for Chapter 11 protection on June 23, 2008 (D. Md. Lead Case No. 08-18254). Joel I. Sher, Esq., at Shapiro Sher Guinot & Sandler P.A, represents the Debtors as counsel. The Debtors' schedules showed assets of $16,105,716 and liabilities of $115,809,357. CCS MEDICAL: Has Deal to Sell NovaMax to Nova Biomedical -------------------------------------------------------- CCS Medical Inc. and whole blood analyzers developer Nova Biomedical Corporation have reached a definitive agreement under which Nova Biomedical's independent, wholly owned subsidiary, Sanvita CBGM, LLC, will acquire certain assets of Sanvita, Inc., a wholly owned subsidiary of CCS Medical. Sanvita, Inc. is currently the exclusive distributor of Nova's "NovaMax" consumer blood glucose product line in the United States. The NovaMax blood glucose monitor has the fastest test time and absolutely no coding. CCS Medical is seeking permission from the Bankruptcy Court to conduct a private sale rather than a public sale. It noted that Sanvita is the sole first distributor of Nova's products while Nova relies on Sanvita as its only means of distribution. "If Sanvita were to liquidate or if it were sold to another party, there is no guaranty that such relationship would continue, and without this continued relationship, the Debtors' businesses could be severely disrupted, resulting in significant harm to the estates," CCS Medical said. According to the asset purchase agreement Nova Biomedical will assume liabilities plus the purchase price, which may be a positive or negative amount, depending on calculations agreed by the parties. "Although, based on the Debtors' current estimates, the Debtors anticipate that no cash consideration will be exchanged for the Acquired Assets, the Debtors will be relieved of significant liabilities." Nova Biomedical will receive a $125,000 break-up fee and expense reimbursement of up to $75,000 in the event CCS Medical terminates the transaction. The acquisition is subject to customary approvals and approval by the Bankruptcy Court, which is overseeing CCS Medical's Chapter 11 case. The parties expect the transaction to close in early October. "Nova Biomedical and Sanvita have had a mutually beneficial business relationship for more than two years," said Francis C. Manganaro, President and Chief Executive Officer of Nova Biomedical. "While our existing business model has served us well to date, we believe that now is the right time for our CBGM subsidiary to assume full control of the distribution of our consumer glucose brand, NovaMax. This will allow Nova to be closer to its customers, to develop innovative NovaMax products, and to bring new NovaMax products to market faster. Together with the recent success of Nova Biomedical's hospital glucose monitor business, StatStrip, the acquisition of assets of Sanvita by the CBGM subsidiary will position Nova Biomedical to further improve its overall glucose monitoring business. John Miclot, Chief Executive Officer of CCS Medical, said, in the parties' September 10 statement, "Today's announcement is a validation of the hard work and commitment of Sanvita, Inc.'s talented work force and to the value they provide every day to customers and patients. We intend to work closely with Sanvita CBGM, LLC to continue to maintain the high level of patient and customer support and satisfaction." About Sanvita CBGM, LLC Sanvita CBGM, LLC is an independent, wholly owned subsidiary of Nova Biomedical. Upon the closing of the acquisition, Sanvita CBGM, LLC will be the exclusive distributor of NovaMax products in the United States. About Nova Biomedical Nova Biomedical is a world leader in the development of whole blood analyzers to support the care of home based and hospitalized patients. Based upon innovative biosensor technology, Nova glucose monitors are designed for rapid and accurate measurement of patient glucose levels without coding test strips. Nova Biomedical has pioneered many advances in glucose testing and introduced its first glucose whole blood biosensor to hospitals in 1987. About CCS Medical Founded in 1994, CCS Medical -- http://www.ccsmed.com/-- has become a leading provider of medical supplies. CCS Medical assists patients that need diabetes test strips, insulin pumps, urological supplies, ostomy supplies, advanced wound care dressings and prescription drugs. Clear Water, Florida-based CCS Medical specializes in providing a convenient way for patients to receive supplies for their chronic illnesses in a manner that saves them time and money. CCS Medical, along with its affiliates, filed for Chapter 11 on July 8, 2009 (Bankr. D. Del. Case No. 09-12390). At the time of the filing, CCS Medical said that it had assets of $100 million to $500 million against debts of $500 million to $1 billion. Attorneys at Young Conaway Stargatt & Taylor, LLP, represent the Debtors. Willkie Farr & Gallagher LLP serves as co-counsel to the Debtors. Goldman, Sachs & Co., serves as investment banker and Alvarez & Marsal Healthcare Industry Group, LLC, as restructuring advisor. Epiq Bankruptcy Solutions LLC is claims agent. CCS MEDICAL: Proposes November 3 General Claims Bar Date -------------------------------------------------------- CCS Medical Inc. and its affiliates ask the U.S. Bankruptcy Court for the District of Delaware to establish November 3, 2009, as the bar date for proofs of claim against them. CCS Medical wants the November 3 deadline to include claims under Section 503(b)(9) of the Bankruptcy Code. Governmental units will have a separate deadline for their prepetition claims. CCS Medical asks the Court to set January 4, 2010, as the deadline for governmental units to file proofs of claim. All proofs of claim must be actually received on or before the applicable bar date by Epiq Bankruptcy Solutions, LLC, the Court- approved claims and noticing agent, at one of these addresses. * If Delivered by Mail: CCS Medical Inc. Claims Processing Center c/o Epiq Bankruptcy Solutions, LLC FDR Station, P.O. Box 5015 New York, NY 10150-5015 * If Delivered by Overnight or Hand Delivery: CCS Medical Inc. Claims Processing Center C/o Epiq Bankruptcy Solutions, LLC 757 Third Avenue, 3rd Floor New York, NY 10017 About CCS Medical Founded in 1994, CCS Medical -- http://www.ccsmed.com/-- has become a leading provider of medical supplies. CCS Medical assists patients that need diabetes test strips, insulin pumps, urological supplies, ostomy supplies, advanced wound care dressings and prescription drugs. Clear Water, Florida-based CCS Medical specializes in providing a convenient way for patients to receive supplies for their chronic illnesses in a manner that saves them time and money. CCS Medical, along with its affiliates, filed for Chapter 11 on July 8, 2009 (Bankr. D. Del. Case No. 09-12390). At the time of the filing, CCS Medical said that it had assets of $100 million to $500 million against debts of $500 million to $1 billion. Attorneys at Young Conaway Stargatt & Taylor, LLP, represent the Debtors. Willkie Farr & Gallagher LLP serves as co-counsel to the Debtors. Goldman, Sachs & Co., serves as investment banker and Alvarez & Marsal Healthcare Industry Group, LLC, as restructuring advisor. Epiq Bankruptcy Solutions LLC is claims agent. CEDAR FUNDING: Ex-President Charged for Defrauding $150MM ---------------------------------------------------------- The former president of Cedar Funding Inc. was charged by prosecutors with defrauding investors of more than $150 million (N.D. Calif Case No. 09-00895). Bloomberg's Joel Rosenblatt reports that prosecutors claim that David Nilsen, of Monterey, California, and Manoel Errico, a loan-servicing manager for Cedar Funding and its Cedar Funding Mortgage Fund Inc. unit, used money from new investors to make payments to previous investors in failed real estate loans. "Investors entrusted Nilsen and Errico with over $150 million, but Nilsen and Errico failed to invest those funds in the manner promised, and converted millions of dollars of the investors' money for their personal benefit," according to the indictment, Bloomberg News said. Monterey, California-based Cedar Funding Inc. -- http://www.cedarfundinginc.com/-- was a mortgage lender. It filed a Chapter 11 petition on May 26, 2008 (Bankr. N.D. Calif. Case No. 08-52709). Judge Marilyn Morgan presides over the case. Cecily A. Dumas, Esq., at Friedman, Dumas and Springwater, in San Francisco, represents the Debtor, and R. Todd Neilson serves as the Chapter 11 Trustee. Cedar Funding, Inc., accepted many millions of dollars from hundreds of individuals who believed they were acquiring fractional interests in loans that were secured by real property. Many more invested with CFI through a related entity, Cedar Funding Mortgage Fund LLP, that acquired fractional interests in the name of the Fund. CFI failed to record assignments of its deeds of trust that would have provided security interests to most of its investors, including the Fund. The Debtor estimated assets of less than $50,000 and debts of $100 million to $500 million in its Chapter 11 petition. CELL THERAPEUTICS: FDA to Review Pixantrone NDA in April 2010 ------------------------------------------------------------- Cell Therapeutics, Inc., said the U.S. Food and Drug Administration has notified CTI that a Prescription Drug User Fee Act action date of April 23, 2010, under standard review has been established regarding CTI's NDA for pixantrone as potential treatment for relapsed or refractory aggressive non-Hodgkin's lymphoma. Pixantrone has fast track designation for the relapsed/ refractory aggressive NHL application. "The 18 month follow up PIX 301 pivotal trial data continues to demonstrate further improvement in primary and secondary endpoints including Complete Remission/Complete Remission unconfirmed (CR/CRu), Progression Free Survival (PFS) and Overall Survival over standard chemotherapy. We look forward to providing the four month safety and efficacy update to the FDA and working with them toward potential approval," said James A. Bianco, M.D., Chief Executive Officer of CTI. Based on the user fee goal date, if pixantrone is approved, CTI estimates that pixantrone could be available to patients in the U.S. early in the second quarter of 2010. Pixantrone (BBR 2778), is a novel topoisomerase II inhibitor with an aza-anthracenedione molecular structure that differentiates it from the anthracyclines and other related chemotherapy agents. Anthracyclines are the cornerstone therapeutic for the treatment of lymphoma, leukemia, and breast cancer. Although they are sufficiently effective to be used as first-line (initial) treatment, they cause cumulative heart damage that may result in congestive heart failure many years later. As a result, there is a lifetime limit of anthracycline doses and most patients who previously have been treated with an anthracycline are not able to receive further anthracycline treatment if their disease returns. Fast track is a process designed to facilitate the development, and expedite the review of drugs to treat serious diseases and fill an unmet medical need. Filling an unmet medical need is defined as providing a therapy where none exists or providing a therapy which may be potentially superior to existing therapy. About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc., (Nasdaq and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. Going Concern Doubt Stonefield Josephson Inc. in Los Angeles, California, expressed substantial doubt about Cell Therapeutics' ability to continue as a going concern after auditing company's financial statements for the years ended December 31, 2008, and 2007. The auditing firm reported that the Company has substantial monetary liabilities in excess of monetary assets as of December 31, 2007, including approximately $19.8 million of convertible subordinated notes and senior subordinated notes which mature in June 2008. It also noted that the Company has sustained loss from operations over the audit periods, incurred an accumulated deficit, and has substantial monetary liabilities in excess of monetary assets as of December 31, 2008. As of June 30, 2009, the Company had $43.2 million in total assets; and $98.7 million in total liabilities; resulting in $57.6 million in shareholders' deficit. The Company had $1.35 billion in accumulated deficit as of June 30, 2009. CENTERPOINT ENERGY: Joint Venture Won't Move Moody's 'Ba1' Rating ----------------------------------------------------------------- Moody's Investors Service commented that its ratings and outlooks for CenterPoint Energy, Inc. (Ba1 senior unsecured/stable outlook) and its subsidiaries CenterPoint Energy Houston Electric (Baa3 issuer rating/positive outlook) and CenterPoint Energy Resources Corporation (Baa3 senior unsecured/stable outlook) are unaffected by the company's announcement of a new field services joint venture, which will be financed in part by an equity offering, which was also announced. "The net impact of these transactions appears neutral for CenterPoint's credit quality, and is not enough to warrant a rating action at this time," says Moody's vice president Mihoko Manabe. "While the investment will increase overall business risk somewhat, the size of the initial investment is manageable, and the upfront equity financing mitigates the related financial risk to a certain degree" added Mr. Manabe. CERC's field services subsidiary CenterPoint Energy Field Services, Inc., has entered into long-term agreements with subsidiaries of EnCana Corporation (Baa2 senior unsecured) and Royal Dutch Shell plc (Aa1 senior unsecured) to provide gathering and treating services in the Haynesville Shale production area in northwest Louisiana. Under the agreement, CEFS has acquired existing facilities from Shell and EnCana and expects to spend between $300 million to $325 million to acquire and expand those facilities to 700 million cubic feet per day. EnCana and Shell could opt for additional expansions, which CenterPoint estimates would require $250 million to $300 million in additional expenditures. CenterPoint also announced the sale of 21 million shares, which at yesterday's closing price would equate to roughly $250 million in proceeds. Moody's noted that although the gathering agreements contain minimum throughput guarantees that will help set the downside risk of the proposed transaction, the cash flow and returns on the investment could vary significantly with volume, gas prices, and the final cost of the expansions. Both EnCana and Shell are highly creditworthy counterparties that have already committed substantial capital and resources in the Haynesville Shale. Nevertheless, Moody's cautions that the Haynesville Shale is still in its early stages of development and that longer term production prospects are still unclear. If the Haynesville venture performs as the company forecasts, CenterPoint's business mix will continue its shift toward unregulated businesses that Moody's considers riskier than its rate-regulated businesses. CEHE, CenterPoint's flagship regulated utility and the strongest subsidiary in Moody's opinion, will contribute a decreasing share of consolidated income. This anticipated increase in overall business risk may well slow the recent developing positive bias in the credit profiles of CenterPoint and CERC. Because CEHE is not directly affected by the new field services investment at this time, Moody's will continue to maintain its current positive rating outlook. Moody's acknowledges CenterPoint Energy's public stock offering of approximately $250 million, which is its first since the company was created in 2002, and is in addition to about $200 million of equity raised already this year mostly through a continuous stock offering program as well as through the company's various stock plans. While this additional equity is a credit positive with respect to the new field services venture, it provides little improvement to CenterPoint's credit metrics (pro forma debt/capitalization ratio of 68% as of June 30, 2009) which remain weak relative to many of its industry peers. Moody's last rating action for the CenterPoint companies occurred on June 30, 2009, when their ratings were affirmed. Headquartered in Houston, Texas, CenterPoint Energy, Inc. is primarily engaged in electric and gas distribution and transmission. CIB MARINE: Plan Voting for TruPS Holders Extended to Sept. 15 -------------------------------------------------------------- CIB Marine Bancshares, Inc., said due to a clerical error on the part of a third party fiduciary, certain holders of its trust preferred securities were informed that the deadline for voting on the holding company's pre-packaged plan of reorganization is September 15, 2009, rather than the September 9, 2009 deadline established by the holding company. Accordingly, in order to avoid confusion and in the interest of fairness, the holding company has formally extended the deadline for voting on the plan until September 15, 2009. "We continue to believe our current restructuring plan is the best solution for those involved and we remain cautiously optimistic that voters will agree and we can move forward," said John Hickey, Jr., chairman and CEO of the holding company. CIB Marine Bancshares is the holding company for CIBM Bank that operates as Central Illinois Bank in mid-state Illinois and as Marine Bank in the Milwaukee area, Indianapolis and Scottsdale. The bank and its branches are not affected by the holding company's reorganization effort. In July 2009, the holding company proposed to exchange all trust preferred securities for non-cumulative perpetual preferred stock and to then file a pre-packaged plan of reorganization. With the extended deadline, outreach and voting on that proposal continues until September 15, 2009. About CIB Marine CIB Marine Bancshares, Inc. (PINKSHEETS: CIBH) -- http://www.cibmarine.com/-- is a one-bank holding company with 17 banking offices in central Illinois, Wisconsin, Indiana, and Arizona. CIB Marine Bancshares is asking holders of its trust preferred securities to give advance approval of a pre-packaged plan of reorganization under Chapter 11 of the Bankruptcy Code that would involve conversion of their debt securities to preferred stock. Under the Plan of Reorganization, roughly $105.3 million of high- interest cumulative indebtedness would be exchanged for 55,624 shares of Series A 7% fixed rate perpetual noncumulative preferred stock with a stated value of $1,000 per share and 4,376 shares of Series B 7% fixed rate convertible perpetual preferred stock with a stated value of $1,000 per share. Each share of CIB Marine's Series B Preferred would be convertible into 4,000 shares of the Company's common stock only upon the consummation of a merger transaction involving the company. The Company Preferred would have no stated redemption date and holders could never force the Company to redeem it. CHARYS HOLDING: Trustee Wants Court to Disallow Claims in Records ----------------------------------------------------------------- The liquidating trustee for Crochet & Borel Services Inc. has filed an objection in the Chapter 11 proceedings of its parent -- wireless communications company Charys Holdings Co. Inc. -- seeking an order disallowing claims that contradict what is listed in Crochet & Borel's books and records. The trustee argues that the unreconciled claims need to be addressed, according to Law360. Headquartered in Atlanta, Georgia, Charys Holding Co., Inc. -- http://www.charys.com/-- and its affiliated debtor, Crochet & Borel Services, Inc., filed for Chapter 11 protection on February 14, 2008 (Bankr. Del. Lead Case No. 08-10289). Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Lydia T. Protopapas, Esq., at Weil, Gotshal & Manges LLP, represented the Debtors as counsel. Chun I. Jang, Esq., Mark D. Collins, Esq., and Paul N. Heath, Esq., at Richards, Layton & Finger, P.A., represent the Debtors as Delaware counsel. Matthew S. Barr, Esq., at Milbank, Tweed, Hadley & McCloy, LLP represented the Official Committee of Unsecured Creditors as counsel. Chad A. Fights, Esq., and Gregory W. Werkheiser, Esq., at Morris, Nichols, Arsht & Tunnell, represented the Committee as Delaware counsel. Upon confirmation of their bankruptcy plan, the Debtors had assets of roughly $215 million and the liabilities of roughly $339 million. CHIYODA AMERICA: Can Hire Garden City as Claims and Noticing Agent ------------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of New York authorized Chiyoda America Inc. to employ The Garden City Group Inc. as its claims and noticing agent. The firm has agreed to: a) notify all potential creditors of the filing of the bankruptcy petition and of the setting of the first meeting of creditors pursuant to section 341(a) of the Bankruptcy Code, under the proper provisions of the Bankruptcy Code and the Bankruptcy Rules; b) assist with and maintaining an official copy of the Debtor's schedules of assets and liabilities and statements of financial affairs, listing the Debtor's known creditors and the amounts owed thereto; c) notify all potential creditors of the existence and amount of their respective claims as set forth in the Schedules; d) docket all claims received, maintaining the official claims register for the Debtor on behalf of the Clerk, and making the claims register available on its website; e) record all transfers of claims and providing any notices of transfers required by Bankruptcy Rule 3001; f) make changes in the Claims Register pursuant to Court Order; g) notice all parties entitled to the same of any other pleadings filed by the Debtor in this case; and h) assist the Debtor with the preparation and distribution of all pleadings and notices required to solicit acceptances to its plan of reorganization and other actions required in the confirmation process. The firm's standard hourly rates: Senior Management $295 Directors, Senior Consultants, and Assistant Vice Presidents $175-$250 Project Managers, Senior Project Managers, and Department Managers $125-$150 Graphic Support $125 Systems & Technology Staff $100-$200 Project Supervisors $95-$110 Quality Assurance Staff $80-$125 Project Administrators $70-$85 Customer Service Rep's $57 Mailroom and Claims Control $55 Data Entry Processors $55 Administrative $45-$70 The Debtor assured the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About Chiyoda America, Inc. New York City-based Chiyoda America, Inc., fka Cosmopolitan Graphics Corporation and Advanced Printing, filed for Chapter 11 on Aug. 19, 2009 (Bankr. S.D.N.Y. Case No. 09-15059). Michael Z. Brownstein, Esq., at Blank Rome LLP, represents the Debtor in its restructuring effort. In its petition, the Debtor listed assets and debts both ranging from $10,000,001 to $50,000,000. CHIYODA AMERICA: Selects Executive Sounding as Turnaround Advisor ----------------------------------------------------------------- Chiyoda America Inc. asks the U.S. Bankruptcy Court for the Southern District of New York for authority to employ Executive Sounding Board Associates LLC as its turnaround consultant and financial advisor. The firm has agreed to: a) prepare initial schedules and monthly operating reports; b) restructure balance sheet debt; c) analyze and report on current liquidity; preparing short- term cash flow forecasts; d) monitor the Debtor's compliance with the reporting requirements; e) assist management in development of the financial aspects of a restructuring plan, including preparing financial projections, liquidation analysis and other schedules in support of the plan of reorganization; f) explore strategic options, joint venture opportunities and other distribution or marketing arrangements with potential investors or synergistic parties; and g) interact with other professionals, attorneys, accountants, lenders and constituencies, as requested. The firm will be compensated for the service of Michael DuFrayne at $395 per hour. The firm's other professionals will be paid between $250 and $450 an hour. The Debtor assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. About Chiyoda America, Inc. New York City-based Chiyoda America, Inc., fka Cosmopolitan Graphics Corporation and Advanced Printing, filed for Chapter 11 on Aug. 19, 2009 (Bankr. S.D.N.Y. Case No. 09-15059). Michael Z. Brownstein, Esq., at Blank Rome LLP, represents the Debtor in its restructuring effort. In its petition, the Debtor listed assets and debts both ranging from $10,000,001 to $50,000,000. CIB MARINE: Debtholders' Vote on Plan Extended Until Sept. 15 ------------------------------------------------------------- The Business Journal of Milwaukee reports that CIB Marine Bancshares Inc. is extending until September 15 the time for some of the Company's trust-preferred security holders to vote on its reorganization plan, after a "clerical error" on the part of a third-party fiduciary. On August 18, CIB Marine first extended the voting deadline until September 9, after the Company's executives found out that they hadn't yet received sufficient votes to approve the Plan. Business Journal quoted CIB Marine chairperson and CEO John Hickey Jr. as saying, "We continue to believe our current restructuring plan is the best solution for those involved and we remain cautiously optimistic that voters will agree and we can move forward." CIB Marine Bancshares, Inc. (PINKSHEETS: CIBH) -- http://www.cibmarine.com/-- is a one-bank holding company with 17 banking offices in central Illinois, Wisconsin, Indiana, and Arizona. CIB Marine Bancshares is asking holders of its trust preferred securities to give advance approval of a pre-packaged plan of reorganization under Chapter 11 of the Bankruptcy Code that would involve conversion of their debt securities to preferred stock. Under the Plan of Reorganization, roughly $105.3 million of high- interest cumulative indebtedness would be exchanged for 55,624 shares of Series A 7% fixed rate perpetual noncumulative preferred stock with a stated value of $1,000 per share and 4,376 shares of Series B 7% fixed rate convertible perpetual preferred stock with a stated value of $1,000 per share. Each share of CIB Marine's Series B Preferred would be convertible into 4,000 shares of the Company's common stock only upon the consummation of a merger transaction involving the company. The Company Preferred would have no stated redemption date and holders could never force the Company to redeem it. CLEARANT INC: June 30 Balance Sheet Upside-Down by $1.76 Million ---------------------------------------------------------------- Clearant Inc.'s balance sheet at June 30, 2009, showed total assets of $1,533,000 and total liabilities of $3,301,000, resulting in a stockholders' deficit of $1,768,000. For three months ended June 30, 2009, the Company posted a net loss of $540,000 compared with a net loss of $474,000 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss of $1,038,000 compared with a net loss of $1,028,000 for the same period in 2008. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4483 Based in Los Angeles, California, Clearant Inc. (OTC BB: CLRA) -- http://www.clearant.com/-- owns the Clearant Process(R) designed to substantially reduce all types of pathogens in biological products including HIV. The Company has distributed implants sterilized by the Clearant Process(R) directly to surgeons, hospitals and clinics since June 2006. In addition, Clearant licenses the Clearant Process(R), and provides its patented sterilization services, to tissue banks and other biological products manufacturers. Going Concern Doubt On March 20, 2009, SingerLewak LLP, in Los Angeles, California, expressed substantial doubt about Clearant's ability to continue as a going concern after auditing the Company's financial statements for the fiscal years ended Dec. 31, 2008, and 2007. The auditor noted that the Company suffered recurring losses from operations and negative cashflow from operations. COLONIAL BANCGROUP: NYSE Delists Securities Effective September 18 ------------------------------------------------------------------ New York Stock Exchange LLC notified the Securities and Exchange Commission of its intention to remove the entire class of these Securities: The Colonial BancGroup, Inc. Common Stock 7.875% Trust Preferred Securities 8-7/8% Subordinated Notes due March 15, 2038 from listing and registration on the Exchange at the opening of business on September 18, 2009, pursuant to the provisions of Rule 12d2-2(b), because, in the opinion of the Exchange, the Securities are no longer suitable for continued listing and trading on the Exchange. The Exchange's action is being taken in view of the fact that on August 14, 2009, Colonial Bank of Montgomery, AL, was closed by the Alabama State Banking Department, with the Federal Deposit Insurance Corporation subsequently named as Receiver. Furthermore, BB&T Corporation announced on August 14, 2009 that it had acquired the banking operations of Colonial Bank of Montgomery, Ala., including $22 billion in assets and $20 billion in deposits, in a transaction facilitated by the FDIC. In this regard, the FDIC and BB&T have entered into a loss sharing agreement covering substantially all acquired loans and securities. Excluded from the transaction are any of the assets or obligations of the parent holding company or select assets and liabilities of Colonial Bank, including any relating to Taylor, Bean and Whitaker Mortgage Corporation. In making its determination, NYSE Regulation considered the substantial reduction in the scope of the Company's operations as a result of this transaction and the uncertainty regarding its effect on the Company's equityholders. The Company had a right to appeal to the Committee for Review of the Board of Directors of NYSE Regulation the determination to delist the Securities, provided that it filed a written request for such a review with the Secretary of the Exchange within ten business days of receiving notice of delisting determination. The Company did not file such request within the specified time period. Headquartered in Montgomery, Alabama, The Colonial BancGroup (NYSE: CNB) provides diversified financial services, including retail and commercial banking, wealth management services, mortgage banking and insurance products. The BancGroup derives substantially all of its income from Colonial Bank, N.A (Colonial Bank) its banking subsidiary. Colonial bank -- http://www.colonialbank.com/-- operates 354 branches in Florida, Alabama, Georgia, Nevada and Texas with over $26 billion in assets. On August 14, 2009, Colonial BancGroup's banking unit Colonial Bank, Montgomery, AL, was closed by the Alabama State Banking Department and the Federal Deposit Insurance Corporation was named receiver. The FDIC sold most of the assets to Branch Banking and Trust, Winston-Salem, North Carolina. BB&T acquired $22 billion in assets and assumed $20 billion in deposits of the Bank. Colonial BancGroup filed for Chapter 11 bankruptcy protection on August 25, 2009 (Bankr. M.D. Ala. Case No. 09-32303). W. Clark Watson, Esq., at Balch & Bingham LLP and Rufus T. Dorsey IV, Esq., at Parker Hudson Rainer & Dobbs LLP assist the Company in its restructuring efforts. The Company listed $45,000,000 in assets and $380,000,000 in debts in its bankruptcy filing. COLUMBIAN PUBLISHING: Files Reorganization Plan ----------------------------------------------- Columbian Publishing Co. filed with the Bankruptcy Court a proposed plan pursuant to which Scott Campbell, the current president and publisher, will receive the new stock of the reorganized company in return for a $500,000 cash investment, Bill Rochelle at Bloomberg reported. Under the Plan, Bank of America N.A., the secured creditor owed $15.5 million, would receive a new $9 million secured note plus a $7 million note currently owing to Columbian by an affiliate. The note is worth as much as $6.5 million. General unsecured creditors are to participate in recoveries by a trust, Bloomberg reported. The Columbian Publishing is a family owned company that operates The Columbian newspaper, which serves Clark County and other parts of southwest Washington. It also runs the Web site http://www.columbian.com/ The Company and its affiliates filed for Chapter 11 bankruptcy protection on May 1, 2009 (Bankr. W.D. D.C. Case No. 09-43133). Albert N. Kennedy, Esq., at Tonkon Torp LLP, assists the Debtors in their restructuring efforts. Columbian Publishing listed $1,000,001 to $10,000,000 in assets and $10,000,001 to $50,000,000 debts. COMMERCIAL VEHICLE: S&P Raises Corporate Credit Rating to 'CCC+' ---------------------------------------------------------------- Standard & Poor's Ratings Services raised its corporate credit rating on New Albany, Ohio-based Commercial Vehicle Group Inc. to 'CCC+' from 'SD' (selective default). S&P also raised its rating on the company's 8% senior unsecured notes to 'CCC' from 'D' (default). The recovery rating on this debt is unchanged at '5', indicating that lenders can expect modest (10% to 30%) recovery in the event of a payment default. S&P's rating actions result from S&P's analysis of the company's business profile and financial prospects following completion of CVG's recent distressed debt exchange. "In S&P's opinion the benefits of the recent transactions to CVG's credit measures are modest and leverage remains very high, although the transaction enhances near-term financial flexibility," said Standard & Poor's credit analyst Nancy Messer. In S&P's view, the company's ability to generate free cash flow and maintain adequate liquidity could be challenged over the next year absent meaningful economic improvement in either North America or Europe. As a result, working capital, capital spending, and SG&A costs must be tightly controlled until revenues improve, perhaps in 2010. The ratings on CVG reflect the company's highly leveraged financial risk profile, which has worsened with the decline of EBITDA caused by the deep trough in demand, and Standard & Poor's Ratings Services' concerns about CVG's cash generation and liquidity, given the prolonged and deep commercial vehicle downturn. S&P could lower the ratings if liquidity declines because CVG's markets fail to begin improving meaningfully in the year ahead, CVG does not realize expected savings from restructuring efforts, or if the company is not able to adequately manage working capital funding requirements. S&P could lower the ratings, for example, if S&P came to believe that CVG would be unable to achieve EBITDA of roughly $25 million in 2010, a level S&P estimate is required to cover cash interest expense and reasonable capital spending. Alternatively, S&P could raise the ratings if, for example, an uptick in demand results in adjusted leverage declining to upper- single-digit levels and sustainable discretionary cash flow, compared to S&P's scenario of double-digit leverage for 2009 and minimal discretionary cash flow. This would likely result from a significant rebound in the U.S. heavy-truck market-that S&P does not assume will occur in 2009-with support from improved economic conditions. COMMUNITY BANCORP: Nasdaq to Delist Shares Effective September 18 ----------------------------------------------------------------- The Nasdaq Stock Market, Inc., has determined to remove from listing the common stock of Community Bancorp, effective at the opening of the trading session on September 18, 2009. Based on a review of the information provided by the Company, Nasdaq Staff determined that the Company no longer qualified for listing on the Exchange pursuant to Listing Rules 5100, 5110(b), and IM-5100-1. The Company was notified of the Staffs determination on August 17, 2009. The Company did not appeal the Staff determination to the Hearings Panel, and the Staff determination to delist the Company became final on August 26, 2009. On August 14, 2009, Community Bank of Nevada, the principal operating subsidiary of Community Bancorp, was closed by the State of Nevada Financial Institutions Division, and the Federal Deposit Insurance Corporation was appointed as receiver of the bank. In addition on August 14, 2009, Community Bank of Arizona, a subsidiary of the Company, was closed by the Arizona Department of Financial Institutions, and the FDIC was appointed as receiver of the bank. The Company intends to file a voluntary petition in the United States Bankruptcy Court in Las Vegas in the near future, seeking relief under Chapter 7 of Title 11 of the United States Code. The Chapter 7 bankruptcy filing is a result of the regulatory actions. As a result of the FDIC being appointed receiver of Community Bank of Nevada and Community Bank of Arizona on August 14, 2009, and the planned Chapter 7 bankruptcy filing, the Company has ceased all business activity and operations since the Banks were the Company's only source of revenue. Upon filing of the petition, the court will appoint a bankruptcy trustee who will be responsible for liquidating the Company. COMSTOCK HOMEBUILDING: Royce Holds 1.99% of Class A Shares ---------------------------------------------------------- Royce & Associates, LLC, disclosed that it is the beneficial owner of 302,500 shares or 1.99% of the Class A Common Stock of Comstock Homebuilding Companies, Inc., as of September 9, 2009. Royce & Associates is an investment adviser registered under Section 203 of the Investment Advisers Act of 1940. Meanwhile, on September 8, Comstock filed with the Securities and Exchange Commission: -- Amendment No. 1 on Form 10-K/A to its Annual Report on Form 10-K for the year ended December 31, 2008. See http://ResearchArchives.com/t/s?4494 -- Amendment No. 1 on Form 10-Q/A to its Quarterly Report of Form 10-Q for the three months ended March 31, 2009. See http://ResearchArchives.com/t/s?4495 The Company filed an abbreviated Form 10-K/A to modify the disclosure regarding the evaluation of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to Items 308(T)(a)(4) and 308(T)(b) of Regulation S-K. "We have evaluated, with the participation of our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of December 31, 2008. Based on this evaluation, our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer have each concluded that our disclosure controls and procedures as of December 31, 2008 are functioning effectively to provide reasonable assurance that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and (ii) accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure," the Company said. The Company filed the Form 10-Q/A to incorporate additional disclosure in "Item 4. Controls and Procedures" and to correct certain errors and omissions in the Exhibit 31 certification required by Exchange Act Rule 3a-14(a) or Rule 15d-14(a). "As of the end of the period covered by this report, our Chairman and Chief Executive Officer and Chief Financial Officer have reviewed and evaluated the effectiveness of our disclosure controls and procedures, which included inquiries made to certain other employees. Based on their evaluation, our Chairman and Chief Executive Officer and Chief Financial Officer have each concluded that our disclosure controls and procedures are effective and sufficient to ensure that we record, process, summarize, and report information required to be disclosed by us in our periodic reports filed under the Securities Exchange Act within the time periods specified by the Securities and Exchange Commission's rules and forms and are also effective to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to management, including our Chief Executive and Chief Financial Officers, to allow timely decisions regarding required disclosure," the Company explained. About Comstock Homebuilding Based in Reston, Virginia, Comstock Homebuilding Companies, Inc. (NasdaqGM: CHCI) -- http://www.comstockhomebuilding.com-- develops, builds and markets single-family homes, townhouses and condominiums in the Washington D.C., Raleigh, North Carolina and Atlanta, Georgia metropolitan markets. The Company also provides certain management and administrative support services to certain related parties. As of June 30, 2009, the Company had $105,329,000 in total assets and $104,904,000 in total liabilities. The Company had accumulated deficit of $154,663,000 as of June 30, 2009. The Company retained external consultants in the second quarter of 2008 to act as a financial advisor to the Company in exploring debt restructuring and alternatives for raising additional capital for the Company. In connection with the exploration of available debt restructuring alternatives, the Company then elected to cease making certain scheduled interest or principal curtailment payments while it attempted to negotiate modifications or other satisfactory resolutions from its lenders. During 2008, the Company reported several loan covenant violations and notices of default from several of its lenders. The violations and notices led to foreclosures of certain assets and have resulted in certain guarantee enforcement actions being initiated against the Company where no foreclosures have taken place. Many of the Company's loan facilities contain Material Adverse Effect clauses which, if invoked, could create an event of default under those loans. In the event certain of the Company's loans were deemed to be in default as a result of a Material Adverse Effect, the Company's ability to meet its cash flow and debt obligations would be compromised. During the fourth quarter of 2008 the Company discontinued its relationship with its external advisory consultants. The Company has continued to negotiate with its lenders into 2009 and has continued to report default notices and debt restructurings as they occur. The Company may experience additional foreclosure actions in the future as a result of the continuing distress in the real estate and credit markets. The Company cannot at this time provide any assurances that it will be successful in its continuing efforts to work with its lenders on loan modifications. This inability to renegotiate debt could result in the Company's need to seek bankruptcy protections either for certain subsidiary entities or for the Company as a whole. CONCHO RESOURCES: S&P Assigns Corporate Credit Rating at 'BB' ------------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned its 'BB' corporate credit rating to independent exploration and production company Concho Resources Inc. S&P also assigned a 'BB' issue- level rating to the proposed $250 million senior unsecured notes due 2017. S&P assigned a '4' recovery rating to this debt, indicating expectations of average (30% to 50%) recovery in the event of a payment default. The outlook is stable. Midland, Texas-based Concho Resources Inc. intends to use the proceeds from the notes offering to partially repay outstanding borrowings under its credit facility and for general corporate purposes. "The ratings on Concho reflect good reserve replacement performance, solid production growth, a favorable production mix given the current hydrocarbon price environment, and a relatively low cost structure," said Standard & Poor's credit analyst Kenneth Cox. The ratings also reflect meaningful reserve and production concentration in the Permian Basin. Concho's business risk profile is weak. The company's proved reserve base totaled 823.7 million cubic feet equivalent at the end of 2008, consisting of 62.9% crude oil and 37.1% natural gas. CORUS BANKSHARES: Potential Investors Get OK to Form New Bank ------------------------------------------------------------- According to David Mildenberg at Bloomberg News, three executives of real-estate developer Related Cos., who are considering a bid for Corus Bankshares Inc., have received interim approval from regulators to charter a new bank that may buy assets from financial firms seized by regulators. Bloomberg relates that the Related executives Stephen Ross, Jeff Blau and Bruce Beal Jr. will own most of the voting shares, and Related won't have any ownership interest in the proposed SJB National Bank, according to an approval letter posted on the Comptroller of the Currency's Web site. The new bank will have at least $750 million of capital, according to the OCC notice. The Related executives are considering a bid for Corus Bankshares, Bloomberg said, citing people familiar with the situation. The Federal Deposit Insurance Corp. is working with potential bidders on selling all or part of Corus as the bank nears collapse, Bloomberg said. For three months ended March 31, 2009, Corus Bankshares posted a net loss of $301,003,000 compared with a net loss of $4,508,000 for the same period in 2008. Based in Chicago, Illinois, Corus Bankshares, Inc. (NASDAQ: CORS) is a bank holding company. Corus conducts its banking operations through its wholly-owned banking subsidiary Corus Bank, N.A. At March 31, 2009, the Company's balance sheet showed total assets of $7,673,845,000 and total liabilities of $7,698,794,000, resulting in a stockholders' deficit of $24,949,000. Going Concern Doubt As reported by the Troubled Company Reporter on April 28, 2009, Corus Bankshares' audited financial statements for the fiscal year ended December 31, 2008, included in the Company's Annual Report on Form 10-K, filed on April 7, 2009, contained a going concern qualification from Ernst & Young, LLP, its independent registered accounting firm. COYOTES HOCKEY: NHL's Bid May Be Unfair, Judge Baum Says -------------------------------------------------------- U.S. Bankruptcy Judge Redfield T. Baum said at a hearing September 10 that the National Hockey League's bid for Coyotes Hockey may violate bankruptcy law since its only proposes to pay "favored creditors." According to Steven Church at Bloomberg News, Judge Baum stated he needs to see a schedule of which claims the NHL is willing to pay. "I am not going to approve the NHL bid until I see those schedules," Judge Baum said. As reported by the TCR on September 10, 2009, Ice Edge Holdings confirmed that it has dropped out of bidding for the Phoenix Coyotes. The auction for the Phoenix Coyotes is now between James L. Balsillie's group PSE Sports and Entertainment -- which offers $242.5 million for the team -- and NHL, which bids $140 million for the team. Judge Baum said he is unlikely to rule on the winning bid until after September 14. Coyotes' owner Jerry Moyes, who has invested $300 million in the Coyotes, has filed a $104 million claim. The NHL's bid does not provide for any payment for Moyes, who has supported Balsillie's bid. About Coyotes Hockey 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. 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. CRESCENT CITY TAX: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Crescent City Tax Service, Inc. 5869 Louis XIV St. New Orleans, LA 70124 Bankruptcy Case No.: 09-12917 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Eastern District of Louisiana (New Orleans) Judge: Elizabeth W. Magner Debtor's Counsel: Lisa Merz Hedrick, Esq. One Shell Square 701 Poydras Street, Suite 4500 New Orleans, LA 70139 Tel: (504) 581-3234 Fax: (504) 566-0210 Email: merzld@arlaw.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/laeb09-12917.pdf The petition was signed by Barbara E. Hirsch, president of the Company. CURTIS DEMILLE CONSTRUCTION: Voluntary Chapter 11 Case Summary -------------------------------------------------------------- Debtor: Curtis DeMille Construction, Inc. 995 N. Lund Highway Cedar City, UT 84720 Bankruptcy Case No.: 09-29672 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court District of Utah (Salt Lake City) Debtor's Counsel: Michele P. Chambers, Esq. Rob Graham & Associates 1091 N. Bluff Street, Suite 306 St. George, UT 84770 Tel: (435) 986-8200 Fax: (435) 986-9720 Email: mchambers@lawyerswest.net Estimated Assets: $100,001 to $500,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Curtis DeMille, president of the Company. DA-LITE SCREEN: S&P Gives Negative Outlook; Affirms 'B' Rating -------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Warsaw, Indiana-based Da-Lite Screen Co. Inc. to negative from stable. At the same time, S&P affirmed all of the ratings on Da-Lite, including the 'B' corporate credit rating. "The outlook revision reflects a sizable reported decline in sales and EBITDA since the beginning of the year, which if continued, could strain Da-Lite's already limited liquidity," said Standard & Poor's credit analyst Jerry Phelan. The ratings reflect the company's narrow business focus, low barriers to entry, increasingly competitive environment, exposure to technology risk, and limited financial flexibility. These concerns exist despite the company's leading position in the niche projector screen industry and historically strong, albeit decreasing, profit margins. Da-Lite is a narrowly focused manufacturer and marketer of projection screens and related presentation products primarily sold to Business/IT, educational, hospitality, and other markets. The company indicates it is the leader in this niche product category in North America and Europe. About 85% of sales come from U.S. operations and 15% from European operations. S&P believes increased competition from low-cost foreign companies, as well as manufacturers of Plasma and Liquid Crystal Displays, which are becoming more competitive due to larger screen sizes, present challenges to the company. Da-Lite's EBITDA margin fell from about 30% in 2006 to 26% in 2008, in part reflecting increased competition. During the first half of 2009, Da-Lite's EBITDA margin declined to about 20%, primarily reflecting the steep 25% sales decline associated with weak demand, primarily from business/information technology, hospitality, and architectural customers. Standard & Poor's expects challenging economic conditions to continue, likely resulting in weak profitability and cash flow until the environment improves. The outlook is negative. S&P is concerned about the substantial decline in revenue and EBITDA, and ability to improve performance in this weak economic environment. S&P believes the company's use of its excess liquidity to repurchase senior notes in open market transactions could have potential implications for liquidity if economic conditions remain weak. S&P could lower the ratings if profitability declines further, which could result from continued weak demand for the company's products, and/or if liquidity weakens, perhaps due to continued senior note repurchases. An outlook revision to stable is unlikely over the next year given S&P's expectations for ongoing weak performance and limited financial flexibility. DELPHI CORP: Nears Bankruptcy Exit, Trims Workers ------------------------------------------------- David Shepardson at the Detroit News, Washington Bureau, reported that Delphi Corp. has laid off about 150 salaried workers in recent weeks as it nears emergence from Chapter 11. As of June 30, Delphi's U.S. employment was about 14,000, with approximately 7,300 hourly workers. Delphi said earlier it planned to have about 12,700 workers by the end of the year and four plants. Delphi, according to Detroit News, may not emerge from bankruptcy protection by September 30 as planned. The exit date may move to sometime in October. "We continue to work toward obtaining the necessary regulatory approvals that will allow Delphi to exit Chapter 11. We expect to exit on or around Oct. 1, however, the actual timing will ultimately be impacted by the receipt of the necessary regulatory approvals," spokesperson Lindsey Williams said. About Delphi Corp Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is a global supplier of mobile electronics and transportation systems, including powertrain, safety, steering, thermal, and controls & security systems, electrical/electronic architecture, and in-car entertainment technologies. Delphi technology is also found in computing, communications, consumer accessories, energy and medical applications. Delphi has approximately 146,600 employees and operates 150 wholly owned manufacturing sites in 34 countries with sales of $18.1 billion in 2008. The Company filed for Chapter 11 protection on October 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court confirmed Delphi's plan on January 25, 2008. The Plan was not consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. At the end of July 2009, Delphi obtained confirmation of a revised plan, build upon a sale of the assets to a entity formed by some of the lenders who provided $4 billion of debtor-in-possession financing, and General Motors Company. Bankruptcy Creditors' Service, Inc., publishes Delphi Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Delphi Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) DESERT DIAMOND: Involuntary Chapter 11 Case Summary --------------------------------------------------- Alleged Debtor: Desert Diamond Homes, LLC 9400 East Mountain View Road Scottsdale, AZ 85258 Case Number: 09-21707 Involuntary Petition Date: September 3, 2009 Court: District of Arizona (Phoenix) Judge: Randolph J. Haines Petitioners Nature of Claim Claim Amount ----------- --------------- ------------ Carole Pavelin secured loan $112,000 1946 E Kentucky Ln. Tempe, AZ 85284 Braden C. Pavelin secured loan $25,000 1946 E Kentucky Ln Tempe, AZ 85284 Jean Arthur Trust secured loan $150,000 1946 E Kentucky Ln. Tempe, AZ 85284 DORAL FINANCIAL: Possible Losses Prompt Moody's to Junk Rating -------------------------------------------------------------- Moody's Investors Service downgraded the senior unsecured rating of Doral Financial Corporation to Caa1 from B2. Doral Financial Corporation is the immediate holding company of Doral Bank, Puerto Rico and is a majority-owned subsidiary of Doral Holdings, LLC. Doral Bank, Puerto Rico is unrated. In the same rating action, the outlook on Doral Financial Corporation was changed to negative from stable. Doral Financial Corporation is referred to hereafter as 'Doral'. The downgrade and negative outlook reflects Moody's view that the company's Doral Bank subsidiary is likely to report losses for the foreseeable future, and that this bank subsidiary may not generate sufficient income in future periods to utilize its current tax loss carry-forwards. If this scenario were to come to pass, Doral Bank would not benefit from tax offsets that would otherwise serve to partially reduce the amount by which capital is depleted. Moody's recognizes that currently the bank subsidiary's regulatory capital ratios and ratio of tangible common equity to risk- weighted assets are relatively high. However, a protracted period of losses, particularly if the losses were not tax-affected, would erode the company's capital base, the rating agency added. This would put substantial stress on its parent, Caa1-rated Doral Financial Corporation. Moody's expectation of continuing losses at Doral is driven in part by the rating agency's anticipation of increased losses being incurred on the construction and commercial real estate mortgages, and the on-going recession in Puerto Rico that is now entering its fourth year. Downgrades: Issuer: Doral Financial Corporation -- Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1 from B2 Outlook Actions: Issuer: Doral Financial Corporation -- Outlook, Changed To Negative From Stable Doral Financial Corporation is headquartered in San Juan, Puerto Rico and reported total assets of $9.8 billion at June 30, 2009. The last rating action on Doral Financial Corporation was on March 17, 2009, when Moody's downgraded the company's senior unsecured rating to B2 from B1 and maintained the stable outlook on the company. EAST FOURTEEN GARDENS: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: East Fourteen Gardens Inc. 3317 Avenue N Brooklyn, NY 11234 Bankruptcy Case No.: 09-47792 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Carla E. Craig Debtor's Counsel: David Carlebach, Esq. 40 Exchange Place, Suite 1306 New York, NY 10005 Tel: (212) 785-3041 Fax: (212) 785-3618 Email: carlebac@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Yehuda Nelkenbaum, president of the Company. ENABLE HOLDINGS: June 30 Balance Sheet Upside-Down by $5 Million ---------------------------------------------------------------- Enable Holdings, Inc.'s balance sheet as of June 30, 2009, showed total assets of $6,531,000 and total liabilities of $11,590,000, resulting in a stockholders' deficit of $5,059,000. For three months ended June 30, 2009, the Company posted a net loss of $3,020,000 compared with a net loss of $2,977,000 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss of $5,693,000 compared with a net loss of $5,362,000 for the same period in 2008. The Company said that there is substantial doubt about its ability to continue as a going concern. The Company noted that as of June 30, 2009, it had accumulated a deficit of $51,366,000. The Company has incurred losses in the last 11 years, significantly so in the last two years, attributable to operations and the change in the business model. The Company has managed its liquidity during this time through a series of cost reduction initiatives and short-term financing transactions. However, the current credit market remains volatile which affects the Company's ability to raise long-term capital financing and inventory financing needed in its business. The Company added that if the Company has not been successful in securing financing, it may not be able to pay, or may delay payment of, accounts payables owed to our vendors which may adversely affect the Company's ability to procure additional materials and services needed to meet its customers' requirements. If the Company is unable to secure long-term financing or capital, the operations will be difficult to continue for the near term. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4487 Enable Holdings, Inc, (OTC:ENAB) fka uBid.com Holdings, Inc., operates online Websites that enable itself, certified merchants, manufacturers, retailers, distributors and small businesses to offer excess, new, overstock, close-out, refurbished and limited supply brand name merchandise to consumer and business customers. Through the Company's websites, located at http://www.uBid.com/ and http://www.RedTag.com/,the Company offers merchandise across a range of product categories, including but not limited to computer products, consumer electronics, apparel, housewares, watches, jewelry, travel, sporting goods, home improvement products and collectibles. The Company's marketplace employs a combination of auction style and fixed price formats. ENERGY XXI: Offers Buyback of Sr. Notes at 80 Cents on Dollar ------------------------------------------------------------- Energy XXI Gulf Coast, Inc. has commenced an exchange offer and consent solicitation in respect of its 10% Senior Notes due 2013. The company has commenced an offer to exchange up to $360 million principal amount outstanding Senior Notes properly tendered and accepted by the company for its newly issued 16% Second Lien Junior Secured Notes due 2014, subject to proration and reduction to $311 million principal amount of Senior Notes, depending on the aggregate principal amount of Second Lien Notes sold in a concurrent private placement. In conjunction with the exchange offer, the company is also soliciting consents from holders of the Senior Notes to certain proposed amendments to the indenture under which the Senior Notes were issued, which, if effected, would modify certain of the restrictive covenants in that indenture in order to permit the issuance of the Second Lien Notes. A tender of Senior Notes by any holder in the exchange offer will also constitute a consent by such holder in favor of the Proposed Amendments. The adoption of Proposed Amendments requires the consents of holders of a majority in principal amount of Senior Notes not held by the company and its affiliates. In exchange for each $1,000 principal amount of Senior Notes properly tendered and accepted by the Company: (i) by 5:00 p.m., New York City time, on September 18, 2009, participating holders of Senior Notes will receive $800 principal amount of Second Lien Notes, subject to proration, and (ii) after the Early Tender Date but prior to Midnight, New York City time, on October 2, 2009, participating holders will receive $750 principal amount of Second Lien Notes, subject to proration. Tendered Senior Notes may be withdrawn prior to 5:00 p.m., New York City time, on September 18, 2009, unless extended. The company has received indications from holders of an aggregate principal amount of approximately $345 million of Senior Notes of their intent to participate in the tender. The Total Consideration payable in the exchange offer for Senior Notes validly tendered prior to the Early Tender Date and not withdrawn and the Exchange Consideration payable in the exchange offer for Senior Notes validly tendered after the Early Tender Date and prior to the Expiration Date: For each $1,000 Amount of Senior Notes Exchanged ---------------------- Total Consider- Exchange ation Consider- if Tender ation Occurs if Tender Prior Occurs to or on After Maximum the Early the Early Outstanding Accept- Tender Date Tender Date Principal ance (Principal (Principal Senior Amount Amount Amount of Amount to be (in (in Second of Second Exchanged CUSIP # mil.) mil.) Lien Notes) Lien Notes) ------------ ------- --------- --------- ----------- ----------- 10% Senior Notes due 2013 29276KAC5 $621.7* $60.0 $800 $750 * Does not include $126.0 million aggregate principal amount of Senior Notes owned by the Company that will be delivered for cancellation concurrently with the closing of the exchange offer and $2.3 million aggregate principal amount of Senior Notes owned by the company's affiliates. Such Senior Notes will not be deemed to be outstanding for purposes of determining the consents required to approve the Proposed Amendments. The aggregate principal amount of Second Lien Notes that may be issued pursuant to the exchange offer in exchange for Senior Notes will be at least $248.8 million and up to a maximum of $288.0 million, depending on the aggregate principal amount of Second Lien Notes and common stock sold in a concurrent private placement. Concurrently with the closing of the exchange offer, the company will sell for cash in a private placement an aggregate principal amount of Second Lien Notes of at least $50.0 million and up to a maximum of $89.0 million. The Second Lien Notes issued in the exchange offer will be designated Series A and the Second Lien Notes issued in the private placement will be designated Series B. The two series initially will bear different CUSIP numbers but will otherwise have the same terms. The company will issue the Second Lien Notes in both the exchange offer and the private placement with an initial maximum aggregate principal amount of up to $338.0 million, as follows: * Series A Second Lien Notes issued pursuant to the exchange offer, in an aggregate principal amount of at least $248.8 million, and up to (a) $288.0 million, less (b) the excess of the Series B Second Lien Notes issued pursuant to the private placement of such notes and shares of Energy XXI (Bermuda) Limited's common stock over $50.0 million, and * Series B Second Lien Notes issued pursuant to the private placement, in an aggregate principal amount of at least $50.0 million and up to $89.0 million. The Second Lien Notes will bear interest at the rate of 16% per annum, consisting of (i) 14% payable in cash and (ii) 2% payable by either increasing the outstanding principal amount of the applicable series or by issuing additional Second Lien Notes of the applicable series, in each case payable on June 15 and December 15 of each year, beginning on December 15, 2009. The Second Lien Notes will mature on June 15, 2014. The obligations under the Second Lien Notes will be guaranteed by the: (i) a guarantee by Energy XXI USA, Inc., the company's direct parent, recourse under which is limited to its ownership of 100% of the Company's outstanding capital stock; (ii) the full and unconditional guarantee of Energy XXI (Bermuda) Limited, the Company's ultimate parent; and (iii) the full and unconditional guarantee of each of the Company's subsidiaries. The Second Lien Notes and the related Guarantees will be subordinated in right of payment to indebtedness under the Company's Amended and Restated First Lien Credit Agreement, as amended, restated, modified or refinanced from time to time. The Second Lien Notes and related Guarantees by the Subsidiaries and the Direct Parent will be secured on a second priority lien basis, subject to certain permitted liens, by the same assets that secure indebtedness on a first priority lien basis under the Company's Credit Agreement. If any party becomes a new guarantor under the Credit Agreement, such party will also become a Guarantor of the Second Lien Notes. As a result, the Second Lien Notes also will be subordinated in priority to the indebtedness under the company's Credit Agreement to the extent of the collateral securing such obligations. Under a proposed intercreditor agreement, under certain circumstances (including a bankruptcy or insolvency of the company or any of the Subsidiaries) payments to holders of Second Lien Notes, but not to holders of the Senior Notes, may be blocked. Notwithstanding any other provision of the exchange offer, the Company's obligation to accept for exchange, and to exchange, any of the Senior Notes validly tendered is subject to the satisfaction or waiver of the following conditions, among others, prior to the settlement date of the exchange offer: * there having been validly tendered and not withdrawn pursuant to the exchange offer Senior Notes having an aggregate principal amount of not less than $311.0 million; * the receipt of the Requisite Consents and execution of a supplemental indenture providing for the Proposed Amendments ; * the Company having closed or concurrently closing the sale of Series B Second Lien Notes in an aggregate principal amount of not less than $50.0 million in the private placement; and * the company having obtained an amendment or amendment and restatement to, or a waiver under, its existing Amended and Restated First Lien Credit Agreement, the effect of which is that the consummation of the exchange offer and concurrent private placement and the issuance of the Second Lien Notes and payments in respect of such notes will not be prohibited under such facility (the "Bank Condition"). About Energy XXI Energy XXI Golf Coast, Inc. -- http://www.energyXXI.com-- is a Houston-based independent energy company engaged in the acquisition, development, exploration and production of oil and natural gas reserves in the U.S. Gulf Coast and the Gulf of Mexico. The Company an indirect wholly owned subsidiary of Hamilton, Bermuda-based Energy XXI (Bermuda) Limited. * * * As reported in the Troubled Company Reporter on September 8, 2009, Moody's Investors Service affirmed Energy XXI Gulf Coast's Caa3 Corporate Family Rating, downgraded its Probability of Default Rating to 'Ca' from 'Caa3', and affirmed the 'Ca' rating on its senior notes due 2013. The rating outlook remains negative. The rating actions reflect Energy XXI's recently announced bond exchange offer for its senior unsecured notes due 2013. At the same time, Standard & Poor's Ratings Services lowered its long-term corporate credit rating on Energy XXI (Bermuda) Ltd. to 'CC' from 'B-', and senior notes of Energy XXI Gulf Coast to 'C' from 'CCC+'. S&P also placed the ratings on CreditWatch with negative implications. ESSAR STEEL: Term Loan Amendment Permits Covenant Compliance -------------------------------------------------------- Sault Ste. Marie, Ontario-based Essar Steel Algoma Inc. said lenders holding a majority of the Company's US$315.7 million Senior Secured Term Loan Credit Facility have approved a permanent amendment to the Facility enabling continued compliance with the Facility and providing the Company with increased operating flexibility going forward. Essar Steel Algoma has been compliant in its covenants to date, however, in view of the prevailing market conditions the Company felt it prudent to seek relaxation of the terms of the Facility. Among other things, the amendment waives compliance with maximum leverage and minimum interest coverage ratios for a four quarter holiday period beginning September 2009 through the quarter ended June 30, 2010, with revised covenant levels reinstated thereafter. The amendment became effective September 9, 2009. The Company's CEO, Armando Plastino, remarked on the waiver noting, "This amendment is an endorsement from our lenders, demonstrating their confidence in the Company's ability to effectively respond to these unprecedented market conditions. It further acknowledges our continued commitment to our employees and the community of Sault Ste Marie through capital investments of nearly CDN $400 million since the acquisition. Currently, steel markets have strengthened both in terms of price and volume allowing us to recall laid-off employees. We are confident that this amendment now provides the Company with the necessary flexibility and stability to continue to weather this market cycle with a view to long term sustainability." FAIRFAX FINANCIAL: Moody's Upgrades Senior Debt Rating to 'Ba1' --------------------------------------------------------------- Moody's Investors Service upgraded the senior unsecured debt rating of Fairfax Financial Holdings Limited to Ba1 from Ba2; upgraded the insurance financial strength ratings of Fairfax's subsidiary, Crum & Forster Holdings Corp., to Baa1 from Baa2 and Crum & Forster's senior debt rating to Ba1 from Ba2. In the same action, Moody's affirmed the IFS ratings of Odyssey Re Holdings Corp.'s main operating subsidiaries at A3 and Odyssey's senior unsecured debt rating of Baa3 and preferred stock rating of Ba2. Moody's also upgraded the preferred stock rating of TIG Capital Trust I, another Fairfax subsidiary, to Ba3 from B1. The outlooks for all ratings are unchanged: positive for Fairfax and TIG, and stable for Crum & Forster and Odyssey Re. This rating action follows Fairfax's announcement that it intends to repurchase the remaining 28% stake in Odyssey Re that it does not own. The upgrades of Fairfax and TIG reflect Fairfax's strengthening financial flexibility and the steady reduction in risk stemming from its run-off operations. The positive outlook reflects the company's long-term commitment to maintaining financial leverage at its current level and substantial holding company liquidity (in the range of $750 million to $1 billion). The upgrade of Crum & Forster reflects the improved financial profile and upgrade of Fairfax as Crum & Forster's ratings had previously been lower than their stand-alone credit profile because of the risks at Fairfax. The affirmation of Odyssey Re's ratings, with a stable outlook, reflects the rating agency's view that the company's underlying financial strength will not be materially altered by the Fairfax repurchase. Fairfax Upgrade Reflects Improved Financial Flexibility And The Stabilization Of Run-Off Businesses Moody's Senior Vice President, Peter Routledge, said "Moody's based the upgrade of Fairfax's senior debt on a substantial improvement in its financial flexibility, resulting from large realized gains in its investment portfolio, as well as diminishing losses in its run-off subsidiaries." Mr. Routledge went on to note that "this rating action marks the second upgrade of Fairfax in the past 18 months, reflective of the substantial gains the company earned on its investments in credit default swaps, equity market hedges, and U.S. treasuries." As a consequence, Fairfax's adjusted financial leverage (or debt-to-capital) ratio has dropped to approximately 31%, after giving effect to the Odyssey Re transaction and the related $1 billion Fairfax equity issue, from 44% in early 2007. According to Moody's, there is clear evidence that Fairfax's run- off operations have stabilized and pose less of a threat to consolidated earnings and holding company cash. More recently, the run-off operations have generated net operating losses of $80 million and $104 million in 2007 and 2008, respectively, versus a range of $214 million to $575 million between 2003 and 2005. The principal reason underlying the stabilization of this operation is the relatively successful strategy of aggressively paying insurance claims early, based on the theory that this is a least-cost method of extinguishing latent claims risk. The number of outstanding claims in the run-off operations is a fraction of what it was five years ago. Finally, the proposed Odyssey Re privatization will provide Fairfax with greater upstream dividend potential because it will no longer be subject to Odyssey Re's limited common share dividend policy. That said, Moody's believes that Fairfax itself has material liquidity and is unlikely to draw material amounts of cash from Odyssey Re in the foreseeable future. Further Moderation In Volatility Needed For Upgrade To Investment Grade With the rating action, Moody's has brought Fairfax's senior unsecured rating to the brink of investment grade, which prompts the question of what underlying factors could lead to an upgrade to investment grade. At the broadest level, such an upgrade would require a moderation in the volatility of Fairfax's overall performance and profile. Fairfax produced an unparalleled investment performance in 2008, realizing approximately $2.7 billion in net gains on an invested asset base of approximately $21 billion. Within that net gains number, however, was $2.2 billion in gross realized losses on its investments, suggesting the company was not entirely immune to the dramatic shifts in the financial markets last year, notwithstanding the fact that its protection against the downturn more than offset these losses. Moody's concern is that these figures are quite large in relation to the $5.5 billion of common shareholders' equity as at the end of the second quarter of 2009. Moody's concern arises because Fairfax's investments could produce future investment losses if the company is not as prescient as it was through the financial crisis. In addition, the holding company's cash position has varied dramatically over the past years, rising from a low of $328 million in 2002 to a high of $1.5 billion in 2008, with sizable annual inflows and outflows during that period. Given the high degree of volatility in financial markets for the foreseeable future, there remains a possibility, in Moody's view, that Fairfax's financial position could be materially weakened by events outside its control. Therefore, another way of moderating this exposure would be to bring down the company's consolidated financial leverage and raise its earnings coverage ratio. Notwithstanding the aforementioned progress, further neutralizing the company's run-off operations would also enhance financial flexibility as this unit remains a moderate consumer of capital, in Moody's view. In addition, Moody's also expects any future upgrade to be a product of healthy pre-tax operating income excluding realized gains, a characteristic of investment grade property & casualty and reinsurance holding companies. More specifically, one or more of these could lead to an upgrade of Fairfax's rating: (1) the stand-alone financial strength ratings of the company's lead operating P&C and/or reinsurance companies are upgraded, (2) adjusted financial leverage stayed below 30% for a sustained period and adjusted earnings coverage (excluding realized gains) remained above 3x; (3) the company maintains its commitment to substantial holding company liquidity (in the $750 million to $1 billion range); (4) a further reduction in risk from Fairfax's run-off operations; and / or (5) adverse claims development at Fairfax's subsidiaries remained below 1% of gross reserves. Conversely, the ratings could be downgraded if: (1) the financial strength ratings of the company's lead operating P&C and/or reinsurance companies are downgraded; (2) adjusted financial leverage rose above 35% and earnings coverage (excluding realized gains) dropped below 2x; (3) the company suffers substantial adverse reserve development in excess of 3% of gross reserves; and / or (4) run-off operations suffers unexpected material adverse reserve development. Upgrade Of Crum & Forster Reflects Easing Of Financial Pressure From Parent As noted above, Moody's also upgraded the senior debt rating of Crum & Forster Holdings Corp. to Ba1 from Ba2, as well as the IFS ratings of its main operating companies -- United States Fire Insurance Company and The North River Insurance Company -- to Baa1 from Baa2. Historically, Moody's had adjusted Crum & Forster's IFS ratings down by one notch from its stand-alone credit profile to reflect the risk associated with its parent, Fairfax -- specifically, its high consolidated financial leverage position and history of substantial adverse reserve development in its operating and run- off subsidiaries. Therefore, the upgrade of Crum & Forster's ratings to their stand-alone credit profile reflects the substantial improvement in Fairfax's financial position and the diminished risk associated with the parent. Moody's view of Crum & Forster's stand-alone credit profile remains unchanged. This view is based upon the operating companies' good position in the commercial middle market sector, diversified revenue streams by geography and product, and a centralized underwriting approach which has produced improved underwriting results over the last several years. Offsetting these strengths are intense competition in commercial middle markets from which the company sources a sizeable portion of its revenue, its sizeable common stock investment portfolio, exposure to both asbestos and environmental claims and to natural and man- made catastrophes, and debt servicing requirements at Crum & Forster Holdings Corp. Furthermore, as the pricing downturn continues, the company will need to maintain underwriting discipline in order to meet financial targets. Affirmation Of Odyssey Re Reflects Company's Underlying Financial Strength In a related action, Moody's affirmed Odyssey Re's ratings after Fairfax announced its offer to repurchase the 28% stake in Odyssey Re owned by minority shareholders. According to Moody's, Odyssey Re's ratings reflect the company's solid position within the competitive broker reinsurance marketplace, its high-quality investment portfolio and improving gross underwriting leverage and financial leverage metrics. These strengths are tempered by the inherent volatility of its catastrophe risk exposures and the potential for additional adverse loss reserve development on its casualty reserves. Financial flexibility at Odyssey Re may weaken because dividend payouts may increase, as a consequence of the company's 100% ownership by Fairfax. In addition, Odyssey Re's loss of access to the capital markets for equity issuances, as a result of its privatization, also weakens financial flexibility, in Moody's view. That said, Moody's does not view the reduced financial flexibility of Odyssey Re as a material change in the company's overall financial strength. In Moody's opinion, the transition to being a wholly-owned subsidiary of Fairfax should result in few changes from an operational perspective. However, Moody's currently has a negative outlook on the reinsurance sector and Moody's believe that core underwriting results at the company are likely to be subdued over the near-to-medium term due to soft pricing for casualty risks. Adverse loss reserve development could also continue to be a drag on earnings. Moody's also notes that Odyssey Re's catastrophe risk exposure has increased, which could subject the company's results and capital position to greater volatility. With regards to Fairfax, Moody's does not foresee a material change in the company's capital structure given Fairfax's commitment to fund the entire repurchase of Odyssey Re common shares via a secondary issuance of Fairfax common stock. As Moody's has previously considered the 28% minority interest position in Odyssey as capital, Fairfax's decision to buy out the minority interest and fund it with its own equity issue does not change Fairfax's consolidated financial leverage. This transaction will not have an impact on consolidated earnings coverage for fixed charges. These ratings were upgraded, while maintaining a positive outlook: * Fairfax Financial Holdings Limited -- senior unsecured debt rating to Ba1 from Ba2; * TIG Capital Trust I -- trust preferred stock to Ba3 from B1. These ratings were upgraded, with a stable outlook: * Crum & Forster Holdings Corp. -- senior unsecured debt rating to Ba1 from Ba2; * United States Fire Insurance Company -- insurance financial strength rating to Baa1 from Baa2; * The North River Insurance Company -- insurance financial strength rating to Baa1 from Baa2. These ratings have been affirmed, with a stable outlook: * Odyssey Re Holdings Corp. -- senior debt at Baa3; preferred stock at Ba2; * Odyssey America Reinsurance Corporation -- insurance financial strength at A3; * Clearwater Insurance Company -- insurance financial strength at A3. Moody's last rating action on Fairfax was on July 3, 2008, when the rating agency upgraded the company's senior unsecured debt rating to Ba2 from Ba3. Moody's last rating action on Crum & Forster was on October 10, 2007, when the rating agency upgraded the company's insurance financial strength ratings to Baa2 from Baa3. Moody's last rating action on Odyssey Re was on July 14, 2009 when Moody's affirmed the company's ratings as well as the IFS ratings of its operating subsidiaries. Fairfax is a financial services holding company which engages in property & casualty insurance, reinsurance, and investment management through its operating subsidiaries. Through June 30, 2009, Fairfax reported net premiums written of $2.2 billion and net income of $215 million for the six-month period, and quarter- end common shareholders' equity of $5.5 billion. Moody's insurance financial strength ratings are opinions of the ability of insurance companies to pay punctually senior policyholder claims and obligations. FAIRPOINT COMMUNICATIONS: CEO Confirms Potential Bankruptcy Filing ------------------------------------------------------------------ According to WMUR, FairPoint Communications Inc. CEO David Hauser said at a joint meeting of New Hampshire, Maine, and Vermont utility regulators in Derry, New Hampshire, that the Company is considering a bankruptcy filing as part of "necessary steps to put ourselves onto more stable financial footing including cutting costs, new revenue generation, and restructuring our debt." Mr. Hauser said the Company has initiated discussions with debt holders regarding a more comprehensive and permanent restructuring of its current capital structure to reduce indebtedness and debt service obligations. "We are considering all other restructuring alternatives available to us, which may include the commencement of an in-court resolution under chapter 11 of the U.S. Bankruptcy Code, with or without a pre-arranged plan of reorganization. If we have to restructure our debt through chapter 11, it's important to understand that our customers will not experience an interruption of service nor will we slow our efforts to improve those areas where improvement is still needed." Mr. Hauser had said in August, when the Company released second quarter results, that the Company may file for Chapter 11 if negotiations with bondholders are not successful. Executives at Fairpoint have appeared at a three-state joint hearing held to address complaints about phone and Internet service problems. Fairpoint took over Verizon Communications Inc. phone and Internet operations in Maine, New Hampshire, and Vermont last year. Complaints continue to pile up from consumers and telecommunications companies that rent FairPoint lines to serve their own clients, NECN states, citing Vendean V. Vafiades of the Maine Public Utilities Commission. About Fairpoint Communications Fairpoint Communications, Inc. (NYSE: FRP) -- http://www.fairpoint.com/-- is a provider of communication services to residential and business customers in rural and small urban communities in the United States. Its services include traditional telephone services, as well as other services, such as local and long distance voice, data, Internet, television, and broadband enabled services. FairPoint Communications is headquartered in Charlotte, North Carolina. Fairpoint had total assets of $3,235,604,000 against total debts of $3,234,372,000, for a stockholders' equity of $1,232,000. As reported by the Troubled Company Reporter on August 5, 2009, Standard & Poor's Ratings Services reassigned a 'CC' corporate credit rating, with a negative outlook to FairPoint from the previous 'SD'. FERRELLGAS LP: S&P Assigns 'B+' Rating on $250 Mil. Senior Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+' issue rating to Ferrellgas L.P.'s $250 million senior unsecured notes due 2017 and its '4' recovery rating to this debt. The '4' recovery rating indicates that lenders can expect average (30%-50%) recovery in the event of a payment default. Standard & Poor's also affirmed the 'B+' corporate credit rating on parent Ferrellgas Partners L.P. and its operating subsidiary Ferrellgas. The offering proceeds will redeem privately placed senior notes due 2010 and 2013 and partially reduce outstanding amounts under Ferrellgas's revolving credit facility. The outlook is stable. S&P expects Ferrellgas's financial profile to improve in fiscal 2009, as the company continues to benefit from wholesale volume growth, primarily driven by increased Blue Rhino volumes, and tuck-in acquisitions within the company's footprint. S&P view this transaction as supportive of credit because it will address future debt maturities and enhance liquidity. S&P expects the company to achieve funds from operations to total adjusted debt of about 15% for fiscal 2009 and total adjusted debt to EBITDA of about 5x, which is a meaningful improvement over fiscal 2008 ratios of about 13% and 5.8x, respectively. As a result, S&P has revised its financial risk profile score to 'aggressive' from 'highly leveraged'. While S&P continues to acknowledge the challenges that Ferrellgas and its rated peer group continue to face, specifically ongoing customer conservation and margin pressure, S&P believes that the Ferrellgas's flexible cost structure and its ability to manage through the commodity cycle partially mitigate S&P's concerns. As of April 30, 2009, retail and wholesale propane distributor Ferrellgas Partners (Ferrellgas L.P.'s parent) had consolidated debt, adjusted for capitalized operating leases, accounts receivable securitization, and accrued interest of $1.3 billion. FERRELLGAS PARTNERS: Moody's Gives Stable Outlook; Puts Ba3 Rating ------------------------------------------------------------------ Moody's Investors Service changed the rating outlook for Ferrellgas Partners, LP, to stable from negative. Moody's also assigned a Ba3 rating to Ferrellgas, LP's proposed offering of $250 million senior notes and affirmed the Ba3 ratings on OLP's existing senior unsecured debt. Ferrellgas' Ba3 Corporate Family Rating and B2 rating on the partnership's notes were also affirmed. OLP is the wholly owned operating partnership subsidiary of Ferrellgas. The proceeds of the offering will be used to retire existing OLP notes and reduce borrowings on its bank credit facility. "The stable outlook reflects the significant progress Ferrellgas has made in reducing its leverage," commented Pete Speer, Moody's Vice-President. "The partnership issued equity to pay down debt and increased earnings during the past fiscal year." During this past fiscal year ended July 31, 2009, Ferrellgas issued $70 million in common units in challenging market conditions to pay down debt. The partnership also significantly increased EBITDA and thereby reduced Debt/EBITDA from 5.7x to around 4.7x. While Ferrellgas' earnings benefited from the rapid decline in propane prices this past heating season, it also achieved some organic customer and volume growth. If this trend is sustainable it would be a significant contrast to its large competitors who continue to experience volume declines excluding acquisitions. Ferrellgas' Ba3 CFR is supported by its leading market position and geographic diversification. The rating is constrained by its still higher leverage and weaker distribution coverage than its propane peers. The stable outlook is based on Moody's expectation that Ferrellgas will maintain its leverage around 4.5x, will fund large acquisitions with meaningful equity and not significantly change its distribution policy. If leverage increases above 5x then the outlook could be changed to negative or the ratings downgraded. The Ba3 rating for OLP's proposed and existing senior unsecured notes reflects both the overall probability of default of Ferrellgas, to which Moody's assigns a Probability of Default Rating (PDR) of Ba3, and a loss given default of LGD 4 (55%). The B2 rating for Ferrellgas' senior unsecured notes reflects the same Ba3 PDR and a loss given default of LGD 6 (91%). The Ferrellgas notes are structurally subordinated to the OLP's senior unsecured notes and the anticipated $400 million senior secured credit facility (unrated) and therefore the notes are rated two notches beneath the Ba3 CFR under Moody's Loss Given Default Methodology. Ratings assigned: * Ferrellgas, LP $250 million senior notes due 2017 - Ba3, LGD 4 (55%) Ratings affirmed: * Ferrellgas Partners, LP CFR and PDR - Ba3 * Ferrellgas Partners, LP $269 million senior notes due 2012 - B2, LGD 6 (91%) * Ferrellgas, LP $$450 million senior global notes due 2014 - Ba3, LGD 4 (55%) changed from LGD 3 (43%) The last rating action was on June 25, 2008, when Moody's assigned a Ba3 rating to OLP's issuance of $200 million of senior unsecured notes. Ferrellgas Partners, LP, is a publicly traded master limited partnership based in Overland Park, KS. The partnership is the second largest retail marketer of propane in the United States and services approximately one million propane customers from locations in all 50 states and Puerto Rico. Through its Blue Rhino brand, it is the largest retail distributor of propane cylinders for grills. FLOYD & BEASLEY: Gas Prices, Unpaid Invoices Causes Ch 11 Bankr. ---------------------------------------------------------------- Floyd & Beasley Transfer Company, Inc., has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of Alabama. Russell Hubbard at The Birmingham News relates that Floyd & Beasley blamed its collapse on gas prices and unpaid invoices. According to The Birmingham News, Floyd & Beasley listed $10.2 million in liabilities against $1.6 million in assets. Floyd & Beasley said in court documents that it has gotten new loans from a lender to make it through the reorganization. Sycamore, Alabama-based Floyd & Beasley Transfer Company, Inc., was founded in Talladega County in 1944 and still run by the one of the original families. The Company operates 175 trucks and 500 trailers hauling freight to 48 states. The Company is among Alabama's oldest and largest trucking companies. FOAMEX INT'L: Gets October 19 Extension for Bankruptcy Plan ----------------------------------------------------------- Foamex International Inc. and its affiliates obtained from the Bankruptcy Court an October 19 extension of its exclusive period to file a Chapter 11 plan. As reported in the Troubled Company Reporter on May 29, 2009, MatlinPatterson Global Advisers LLC and Black Diamond Capital Management LLC won the bidding for Foamex's business with a $155 million offer, along with the assumption of some liabilities. Wayzata Capital Investment Partners LLC won the first auction for the assets. However, the auction was reopened, and MatlinPatterson and Black Diamond emerged the winning bidder. About Foamex International Foamex International Inc. -- http://www.foamex.com/-- headquartered in Media, Pennsylvania, produces polyurethane foam- based solutions and specialty comfort products. The Company services the bedding, furniture, carpet cushion and automotive markets and also manufactures high-performance polymers for diverse applications in the industrial, aerospace, defense, electronics and computer industries. Foamex and eight affiliates first filed for Chapter 11 protection on September 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693). On February 2, 2007, the U.S. Bankruptcy Court for the District of Delaware confirmed the Debtors' reorganization plan. The Plan became effective and the Company emerged from Chapter 11 bankruptcy on February 12, 2007. Foamex missed $7.3 million in interest payments due at the end of the January 21 grace periods on the Company's $325 million first- lien term loan and the $47 million second-lien term loan. On February 18, 2009, Foamex International Inc. and seven affiliates filed separate voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 09-10560). The Hon. Kevin J. Carey presides over the cases. Ira S. Dizengoff, Esq., Phillip M. Abelson, Esq., and Brian D. Geldert, Esq., at Akin Gump Strauss Hauer, in New York, represent the Debtors as counsel. Mark E. Felger, Esq., and Jeffrey R. Waxman, Esq., at Cozen O'Connor, in Wilmington, Delaware, represent the Debtors as Delaware counsel. Investment banker is Houlihan Lokey; accountant is McGladrey & Pullen LLP; and claims and noticing agent is Epiq Bankruptcy Solutions LLC. Sharon L. Levine, Esq., at Lowenstein Sandler, is counsel to the Official Committee of Unsecured Creditors. David M. Fournier, Esq., Evelyn J. Meltze, Esq., and Leigh-Anne M. Raport, Esq., at Pepper Hamilton LLP, is the Committee's Delaware counsel. As of September 28, 2008, the Debtors had $363,821,000 in assets, and $379,710,000 in debts. FORD MOTOR: Canadian Union Wants Assembly Plant to Remain Open -------------------------------------------------------------- Greg Keenan at The Globe and Mail reports that the Canadian Auto Workers union has asked Ford Motor Co. to keep an assembly plant near St. Thomas, Ontario, open. According to The Globe and Mail, the plant is believed to be doomed. Ford said that it has no products to assemble at the plant after 2011, The Globe and Mail says, citing CAW President Ken Lewenza. "They haven't said it's closed, but when you don't have a product after 2011 you don't have to add it up," The Globe and Mail quoted Mr. Lewenz as saying. The Globe and Mail states that the plant's closure would result in the laying off of 1,600 workers, and reduction of Ford's manufacturing operations in Canada to less than 10% of its North American total, from 14%. Workers won't agree to concessions granted to Ford's rivals in Canada unless the Company maintains its Canadian operations, The Globe and Mail relates, citing CAW. According to the report, Mr. Lewenza said, "We told them very clearly that what workers are looking for as a result of sacrifices is enhanced job security, not reduced job security." 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. Ford Motor carries a 'Ca' issuer credit and a 'Caa3' long term corporate ratings, with negative outlook, from Moody's. Fitch Ratings said via Business Wire on August 26 that it has revised the Rating Outlook on Ford Motor Company and Ford Motor Credit Company to Stable from Negative. In addition, the Issuer Default Rating of Ford is affirmed at 'CCC'. FORMIDABLE LLC: Meeting of Creditors Scheduled for October 1 ------------------------------------------------------------ The U.S. Trustee for Region 19 will convene a meeting of creditors in Formidable, LLC's Chapter 11 case on Oct. 1, 2009, at 10:00 a.m. The meeting will be held at 405 South Main Street, Suite 250, Salt Lake City, Utah. 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. Salt Lake City, Utah-based Formidable, LLC, filed for Chapter 11 on Aug. 27, 2009 (Bankr. D. Utah Case No. 09-29087). Lon A. Jenkins, Esq., and Troy J. Aramburu, Esq., at Jones Waldo Holbrook & McDonough, represent the Debtor in its restructuring effort. In its petition, the Debtor listed $100,000,001 to $500,000,000 in assets and $10,000,001 to $50,000,000 in debts. FORMTECH INDUSTRIES: To Conduct Sept. 29 Auction for All Assets --------------------------------------------------------------- The Hon. Mary Walrath of the U.S. Bankruptcy Court for the District of Delaware approved procedures governing the sale of substantially all of assets of FormTech Industries LLC and FormTech Industries Holdings LLC. Deadline for submitting a qualified bid for the Debtors' assets is Sept. 28, 2009, at 4:00 p.m. An auction will take place on Sept. 29, 2009, at 10:00 a.m., followed by a sale hearing on Oct. 1, 2009, at 2:00 p.m. HHI Funding LLC has been named stalking-horse bidder for the Debtors' assets. HHI Funding is the Debtors' debtor-in-possession lender. The DIP lender agreed to provide $8.5 million in financing to the Debtor. A full-text copy of the assets sale agreement is available for free at http://ResearchArchives.com/t/s?4482 As part of the sale deal, HHI Funding will receive a $2 million break-up fee and expense reimbursement of up to $750,000, if the Debtors consummate the transaction with another party. Roberta A. DeAngelis, the U.S. Trustee for Region 3, and unsecured creditor Gerdau MacSteel Inc. objected to the proposed terms of the auction, noting that HHI Funding would be allowed to credit bid prepetition debt for all of the Debtors' assets without any marketing period and any meaningful opportunity to for other interested parties to conduct due diligence. About Formtech Industries Based in Royal Oak, Michigan, FormTech Industries LLC -- http://www.formtech2.com/-- is among the largest independent manufacturers of forged automotive parts in North America and the leader in high volume hot-formed manufacturing through its operations in Royal Oak, Michigan and Tonawanda, New York. FormTech was adversely impacted by the precipitous decline in automotive production in the first half of 2009. Through this time period, FormTech remained a highly reliable supplier and substantially restructured its operations. The company has over 400 employees, primarily in Michigan and Ohio and operates six manufacturing facilities. The Company and its affiliate, FormTech Industries Holdings LLC, filed for Chapter 11 protection on Aug. 26, 2009 (Bankr. D. Del. Case Nos. 09-12964 and 09-12965). Lynn M. Brimer, Esq., Meredith E. Taunt, Esq., and Andrew A. Ayar, Esq., at Strobl & Sharp, P.C., represent the Debtors in their restructuring efforts. The Debtors selected Steven M. Yoder, Esq., Jeremy W. Ryan, Esq., and, R. Stephen McNeill, Esq., at Potter Anderson & Corroon LLP, as co- counsel, and Kurtzman Carson Consultants LLC, as claims agent. In its petition, FormTech Industries LLC listed assets between $100 million and $500 million, and debts between $50 million and $100 million. FREMONT GENERAL: Hearing on Outline to Competing Plans Sept. 17 --------------------------------------------------------------- The Bankruptcy Court will convene a hearing on September 17 to consider approval of the disclosure statements to the competing plans filed by Fremont General Corp., its equity holders, and its unsecured creditors. Approval of a disclosure statement would allow the plan proponent to begin soliciting votes on, then seek confirmation of, its plan. The Official Committee of Equity Holders says the disclosure statement to the plan filed by the Official Committee of Unsecured Creditors does not provide "adequate information", including with respect to a proposed Plan Administrator. The Creditors Committee also raised its own objections to the Equity Committee's disclosure statement, saying that it contains a variety of provisions that "will ultimately make [the plan's] confirmation impossible." It says the interest rates proposed by the Equity Committee on deferred plan payments plainly violate the requirements of the Bankruptcy Code and Ninth Circuit law. Fremont says it won't oppose the use of either of the Committee Disclosure Statements for purposes of soliciting votes for or against the underlying plans. Fremont says that issues it will raise regarding underlying projections or other fact-intensive matters related to treatment of claims and interests under the plans are confirmation issues that should properly be considered at a confirmation hearing. 3 Competing Plans In June, the Company filed a proposed Chapter 11 plan that offers to pay 100 cents on the dollar to general unsecured creditors through pro rata distribution of cash, until the claim has been satisfied, including payment of post-petition interest, as applicable. Holders of equity interests will also receive interests under the Plan. A full-text copy of the disclosure statement with respect to Fremont's Chapter 11 Plan is available for free at http://bankrupt.com/misc/Fremont.DS.pdf In July, the Equity Committee filed a proposed Chapter 11 plan for the Company. The Plan promises to pay all creditors in full with interest, unless they elect to give up interest in return for quicker payment. Debt includes $63 million in unsecured claims plus almost $274 million to holders of debt securities. The shareholders' plan would be financed with $27.9 million in cash that Fremont has on hand plus cash held in a nonbankrupt subsidiary. After the plan becomes effective, the shareholders say Fremont will have $90 million available. The equity holders intend to buy banks and use Fremont's tax loss carryforwards. A copy of the disclosure statement explaining the equity committee's plan is available for free at: http://bankrupt.com/misc/Fremont_EquityHoldersDSCompetingPlan.pdf In July, the Creditors Committee also presented its own plan for Fremont. Under its Plan, holders of class 3 general unsecured claims are afforded the option of waiving their right to post- petition interest in exchange for payment in full of the amount owing to the holders on or before October 31, 2009, so long as sufficient cash is then available to make such payment. Holders of interests in the Debtor will retain those interests in the form of equity trust interests in an Equity Trust established under the Plan. A copy of the disclosure statement explaining the creditors' committee's plan is available for free at: http://bankrupt.com/misc/Fremont_CreditorsDSCompetingPlan.pdf About Fremont General Based in Santa Monica, California, Fremont General Corp. (OTC: FMNTQ) -- http://www.fremontgeneral.com/-- was a financial services holding company with $8.8 billion in total assets at September 30, 2007. Fremont General ceased being a financial services holding company on July 25, 2008, when its wholly owned bank subsidiary, Fremont Reorganizing Corporation (f/k/a Fremont Investment & Loan) completed the sale of its assets, including all of its 22 branches, and 100% of its $5.2 billion of deposits to CapitalSource Bank. Fremont General filed for Chapter 11 protection on June 18, 2008, (Bankr. C.D. Calif. Case No. 08-13421). Robert W. Jones, Esq., and J. Maxwell Tucker, Esq., at Patton Boggs LLP, Theodore Stolman, Esq., Scott H. Yun, Esq., and Whitman L. Holt, Esq., at Stutman Treister & Glatt, represent the Debtor as counsel. Kurtzman Carson Consultants LLC is the Debtor's noticing agent and claims processor. Lee R. Bogdanoff, Esq., Jonathan S. Shenson, Esq., and Brian M. Metcalf, at Klee, Tuchin, Bogdanoff & Stern LLP, represent the Official Committee of Unsecured Creditors as counsel. Fremont's formal schedules showed $330,036,435 in total assets and $326,560,878 in total debts. FRONTIER AIRLINES: Ch. 11 Plan Okayed; To Emerge as Republic Unit ----------------------------------------------------------------- Frontier Airlines Holdings, Inc., said September 10 that the Bankruptcy Court for the Southern District of New York has confirmed the Company's Plan of Reorganization. The Company successfully resolved the few objections to its Plan of Reorganization prior to the September 10, resulting in an uncontested confirmation hearing. Frontier, along with its legal advisors Davis Polk and Wardwell LLP and financial advisors Seabury Group, LLC, has worked throughout its stay in bankruptcy to achieve consensual resolutions with affected parties, which has become a hallmark of Frontier's entire Chapter 11 case. With the Bankruptcy Court's order confirming its Plan of Reorganization, Frontier will proceed to emerge from bankruptcy on or about October 1, 2009, as a wholly owned subsidiary of Republic Airways Holdings, Inc. (NASDAQ: RJET) "This is an extremely proud day for everyone in our Company," said Frontier President and CEO Sean Menke. "Many people doubted that we would even survive, let alone accomplish a successful reorganization, provide a recovery for our creditors and emerge a stronger competitor and company. Upon consummation of our Plan of Reorganization with Republic, we will be a successfully restructured airline, well positioned to be a competitive, successful, sustainable airline for years to come." Mr. Menke continued, "I must give a special thanks to all of our Frontier and Lynx employees. Their hard work, sacrifice and resiliency during the bankruptcy was key to our successful reorganization. They are the primary reason why Frontier Airlines and Lynx Aviation are where we are today." Frontier Airlines Holdings, Inc., and its debtor-affiliates submitted on September 8, 2009, to Judge Robert D. Drain a revised version of their Chapter 11 Joint Plan of Reorganization. A blacklined copy of the pages in the Plan containing the revisions is available for free at: http://bankrupt.com/misc/FAH_RevisedPlan.pdf About Frontier Airlines Frontier Airlines Holdings, Inc. (OTCBB: FRNTQ) is the parent company of Denver-based Frontier Airlines and Lynx Aviation. Currently in its 16th 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 is made up of one of the youngest Airbus fleets in North America offering 24 channels of DIRECTV(R) service in every seatback along with a comfortable all- coach configuration. In conjunction with a fleet of Bombardier Q400 aircraft operated by Lynx Aviation, Frontier offers routes to more than 50 destinations in the U.S., Mexico and Costa Rica. In addition, Frontier and Midwest Airlines have a codeshare partnership that allows passengers of both airlines access to 70 destinations in the U.S., Mexico and Costa Rica. Republic Airways Holdings, Inc. (NASDAQ: RJET) expects to close on its purchase of Frontier Airlines on or about Oct. 1, 2009, after which Frontier and Lynx will become subsidiaries of Republic, alongside Midwest Airlines and Republic's other wholly owned subsidiaries. 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. As reported by the TCR on August 14, Republic Airways Holdings, Inc. has been declared the winning bidder in the auction to acquire Frontier, beating Southwest Airlines. 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) GENERAL GROWTH: U.S. Trustee Forms 7-Member Equity Committee ------------------------------------------------------------ Pursuant to Section 1102 of the Bankruptcy Code, Diana G. Adams, United States Trustee for Region 2, appointed on September 8, 2009, seven creditors to serve as members of the Official Committee of Equity Security Holders in General Growth Properties, Inc., and its 387 debtor-affiliates' Chapter 11 cases: (1) Marshall Flapan, as trustee 3435 Southern Hills Drive Des Moines, Iowa 50321 (2) Warren & Penny Weiner, as tenants by the entirety 912 Spring Mall Road Villanova, Pennsylvania 19085 (3) Stanley B. Seidler Trust c/o Stanley B. Seidler 1030 South Fall Creek Road Wilson, Wyoming 83014 (4) William J. Goldsborough 22 West 131 Ahlstrand Road Glen Ellyn, Illinois 60137 (5) Platt W. Davis, III 7500 San Felipe, Suite 600 Houston, Texas 77063 (6) Mary Bucksbaum Scanlan P.O. Box 670 Woody Creek, Colorado 81656 (7) General Trust Company, as Trustee Attn: E. Michael Greaves, Vice President 300 North Dakota Avenue, Suite 202 Sioux Falls, South Dakota 5710 About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly ] 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No. 09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of December 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL GROWTH: To Auction Off Natick Condo Units October 4 ----------------------------------------------------------- According to Boston Globe, General Growth Properties is planning to auction off more than 40 high-end condominiums attached to the upscale Natick Collection with minimum bids starting at $160,000, about 70% below previous asking prices. The report relates that the 215-unit project, known as Nouvelle at Natick, opened last year and was supposed to usher in a new era of suburban living -- marrying shopping and luxury -- without the hassles and high prices of the city. Only 37 of the residences, however, have been sold or under contract. General Growth, according to Boston Globe, has hired Accelerated Marketing Partners to handle the auction of 42 units on Oct. 4 as a way to jump-start sales and get some desperately needed cash. About General Growth Based in Chicago, Illinois, General Growth Properties, Inc. -- http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals roughly ] 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. General Growth is a self- administered and self-managed real estate investment trust. The Company's common stock is trading in the pink sheets under the symbol GGWPQ. General Growth Properties Inc. and its affiliates filed for Chapter 11 on April 16, 2009 (Bankr. S.D.N.Y., Case No. 09-11977). Marcia L. Goldstein, Esq., Gary T. Holtzer, Esq., Adam P. Strochak, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, have been tapped as bankruptcy counsel. Kirkland & Ellis LLP is co-counsel. Kurtzman Carson Consultants LLC has been engaged as claims agent. The Company also hired AlixPartners LLP as financial advisor and Miller Buckfire Co. LLC, as investment bankers. The Debtors disclosed $29,557,330,000 in assets and $27,293,734,000 in debts as of December 31, 2008. Bankruptcy Creditors' Service, Inc., publishes General Growth Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Growth Properties Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Magna's EUR500 Million Offer for Opel Accepted -------------------------------------------------------------- Magna International Inc. (TSX: MG.A, NYSE: MGA) and Savings Bank of the Russian Federation (RTS: SBER, MICEX: SBER03) on September 10 announced that their joint offer to acquire a 55% interest in Adam Opel GmbH has been selected by both General Motors Company and the Opel Trust as the preferred solution to address the future of Opel. Under the offer, the acquired 55% interest in Opel would be owned 50:50 by a Magna/Sberbank consortium with GM retaining a 35% interest and Opel employees acquiring 10% as part of a new labour framework. The offer contemplates a total equity investment by the Consortium of Euro 500 million over time. "The Consortium is pleased that its plan for Opel has satisfied General Motors. Together with General Motors, Opel employees and Opel dealers, the Consortium will now work hard to lead Opel into a successful future," said Siegfried Wolf, Magna's Co-Chief Executive Officer and Herman Gref, Chairman of the Board and Chief Executive Officer of Sberbank. "Additionally, the Consortium is grateful to General Motors for the constructive atmosphere during the negotiations and to those parties which have provided their support for the Consortium's business plan, including in particular the German government." Added Frank Stronach, Magna's Chairman, "Upon the successful completion of the acquisition Magna will put in place appropriate "firewalls" in order to ensure a complete separation between its current auto parts business and Opel so that the confidential and proprietary information of its customers is fully protected." Completion of the purchase remains subject to finalization of definitive agreements and other conditions, including government- backed financing and regulatory approvals. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- as founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GENERAL MOTORS: Beijing Automotive Joins Koenigsegg's Saab Bid -------------------------------------------------------------- Niklas Magnusson and Toby Alder at Bloomberg News report that Chinese carmaker Beijing Automotive Industry Holdings Co. Ltd. joined Koenigsegg Group's offer to buy Saab Automobile from General Motors Co. Bloomberg relates Koenigsegg Group, set up by Swedish sports-car maker Koenigsegg Automotive AB, said in a statement yesterday Beijing Automotive will take a minority stake in the team bidding for Saab and help the unprofitable GM division find opportunities to expand in China. According to Bloomberg, Christian von Koenigsegg, the sports-car company's founder, said Beijing Automotive, a former suitor for GM's Opel and Vauxhall units, may share technology with Saab and offer some plant capacity. The stake sale to Beijing Automotive means the group has bridged the private-financing gap, Mr. von Koenigsegg, as cited by Bloomberg said, declining to comment on the Chinese company's planned holding or amount it's paying. On Sept. 8, 2009, the Troubled Company Reporter-Europe, citing The Financial Times, reported that a request from Mr. von Koenigsegg for an additional government loan was rejected by Sweden's center- right administration. The FT said even without further aid, the acquisition is still dependent on a EUR400 million-EUR500 million loan from the EU-backed European Investment Bank, guaranteed by Sweden. Creditor Protection The Troubled Company Reporter Europe, citing Bloomberg News, reported on Feb. 23, 2009, Saab filed for protection from creditors after parent GM said it will cut ties with the Swedish carmaker following two decades of losses. The Trollhaettan, Sweden-based company filed for reorganization with a Swedish district court to separate itself from GM and bring resources back to Sweden. On June 25, 2009, Troubled Company Reporter, citing The Wall Street Journal, reported creditors of Saab approved the automakers' proposal for settling its debts by paying a quarter of what it originally owed. Saab proposed to settle its debts by paying 25% of about US$1.34 billion it owed to more than 600 creditors, including auto suppliers and the Swedish government. The vast majority of the debt, almost SEK10 billion, was owed to GM. About Saab Automobile Saab Automobile AB -- http://www.saab.com-- is a wholly owned subsidiary of General Motors. With an annual production of up to 126,000 cars, Saab's current models include the 9-3 (available as a convertible or sport sedan), the luxury 9-5 sedan (also available in a sport wagon), and the seven-passenger 9-7X SUV. GENERAL MOTORS: Germany Can't Force Early Repayment of Opel Loan ---------------------------------------------------------------- Chris Reiter and Tony Czuczka at Bloomberg News report that General Motors Co. said Germany can't force an early repayment of a EUR1.5-billion (US$2.2 billion) loan for its Opel unit in Europe even if its board rejects a sale to a group led by Magna International Inc. Bloomberg relates Karin Kirchner, a GM spokeswoman in Zurich, said the loan, which kept Opel from collapsing, isn't tied to GM's decision over the future of the unit. According to Bloomberg, German Economy Minister Karl Theodor zu Guttenberg said yesterday that the lending is tied to "an investor solution." Germany has offered to provide EUR4.5 billion in loan guarantees to finance a Magna purchase, which is also supported by Opel unions. Citing Roland Koch, the premier of Opel's home state of Hesse, Bloomberg discloses the government's loan to Opel expires Nov. 30. Opel has "sufficient liquidity in the coming months," Carl-Peter Forster, GM's top executive in Europe, as cited by Bloomberg, said yesterday according to Auto Motor und Sport magazine. "The problem is we can't start our restructuring, because we still don't have financing." Options Bloomberg says GM's board is considering options including keeping Opel and accepting bids to acquire a majority stake in the unit from Belgian investment company RHJ International SA as well as from Canadian auto-parts supplier Magna and its Russian partner OAO Sberbank. Brian Parkin and Tony Czuczka at Bloomberg News reports political analysts said any decision by GM to shun Magna's bid for Opel and hold on to the German-based carmaker might hurt Chancellor Angela Merkel's bid to win re-election on Sept. 27. The German chancellor has repeatedly said she prefers Magna's plan to buy a majority stake in Opel over a rival bid by RHJ. Merkel's handling of Opel has been "anything but a showpiece of shrewd political bargaining," Bloomberg quoted Uwe Andersen, a politics professor at the University of Bochum, the western German city where Opel employs about 5,300 workers, as saying in an interview. "She swung behind Magna way too soon and has stuck with it since, even as realities at GM changed." Decision James Quinn at The Daily Telegraph reportst that the board of GM was last night on the brink of voting to retain ownership of its European Opel business. According to the Daily Telegraph, the decision, if approved, could be announced as early as today, Sept. 10, at a press conference in Berlin. Citing a source with knowledge of the board's discussions, the Daily Telegraph states that although a final decision had not been taken, the option of refinancing had come right up the agenda during GM's two-day board meeting in Detroit which was due to end last night. For Vauxhall, the implication of the decision, if it comes, is a positive one, as the Magna proposal had involved not closing any plants in Germany, putting the future of GM's UK operations at risk, the Daily Telegraph says. The refinancing option will still require plants to be closed and/or mothballed, however, as part of what one source described as a "far reaching" restructuring plan, the Daily Telegraph notes. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, is the Debtors' restructuring officer. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) GIBSON GUITAR: Moody's Gives Negative Outlook, Affirms 'B2' Rating ------------------------------------------------------------------ Moody's Investors Service revised it rating outlook for Gibson Guitar Corp to negative from stable while at the same time affirming Gibson's ratings, including its B2 corporate family rating and B2 senior secured credit facility rating. The negative outlook reflects Moody's view that Gibson's cushion under its financial leverage covenant may be very tight over the next few quarters, especially as the covenant contractually adjusts in Q1 2010. Covenant cushion has deteriorated due to the decline in revenue and earnings in Q1 and Q2 2009. The risk that these circumstances will continue in the near to mid term is also a factor in the negative outlook. "The negative outlook also reflects Moody's concern about the company's ability to issue its 2008 audited financial statements within the required waiver period" said Kevin Cassidy, Senior Credit Officer at Moody's Investors Service. Failure to complete the audit by the waiver deadline, any significant adjustments in previously audited financial statements or failure to comply with financial covenants, could result in a downgrade. The corporate family rating reflects the company's ability to generate free cash flow, its strong brand names and product diversification within guitars and its geographic diversification. In addition to the factors driving the negative outlook, the rating is constrained by Gibson's modest size with revenue approximated $300 million and increasing financial leverage. These ratings were affirmed/assessments revised: * Corporate family rating at B2; * Probability-of-default rating at B3; * $50 million senior secured revolving credit facility due 2011 at B2 (LGD 3, 32% from 31%); * $100 million senior secured term loan B due 2013 at B2 (LGD 3, 32% from 31%) Headquartered in Nashville, Tennessee, Gibson Guitar Corp. primarily manufactures and markets acoustic and electric guitars under the Gibson and Epiphone brand names. The company also sells other stringed instrument and instruments related accessories such as amplifiers, speakers, and picks/straps. Revenues for the twelve months ended June 28, 2009 were approximately $300 million. The last rating action was taken on July 28, 2008, when Moody's stabilized the outlook and affirmed all other ratings. GLOBAL CROSSING: To Raise $650MM in Private Placement of Sr. Notes ------------------------------------------------------------------ Global Crossing Limited intends to offer $650 million of its senior secured notes due 2015 in a private placement to qualified institutional buyers in accordance with Rule 144A and Regulation S under the Securities Act of 1933, as amended. A portion of the proceeds of the offering will be used to (i) repay Global Crossing's term loan facility in full, together with a prepayment penalty and unpaid interest to but not including the date of repayment and (ii) purchase any and all of GC Impsat Holdings I Plc's 9.875% senior notes due February 15, 2017 validly tendered and not withdrawn in the concurrent tender offer by GC Impsat Holdings I Plc, and to pay accrued and unpaid interest in connection therewith. The purpose of the offering is also to raise capital for general corporate purposes. The senior secured notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. In connection with the offering, the Company intends to deliver a confidential offering circular to certain qualified institutional buyers in reliance on Rule 144A under the Securities Act and to non-US persons in offshore transactions in reliance on Regulation S under the Securities Act. The offering circular includes information that is not included in the Registrant's previously filed SEC reports which may be of general interest to existing investors in the Company's other debt and equity securities currently outstanding. Excerpts of the offering circular are available at no charge at http://ResearchArchives.com/t/s?4490 As reported by the Troubled Company Reporter on August 7, 2009, Global Crossing Ltd. reported $2.32 billion in total assets and $2.61 billion in total liabilities, resulting in $28.5 million in stockholders' deficit at June 30, 2009. Global Crossing's balance sheet at June 30 also showed strained liquidity, with $749 million in total current assets, including $268 million in cash and cash equivalents, against $945 million in total current liabilities. About Global Crossing Global Crossing (NASDAQ: GLBC) is a global IP solutions provider with the world's integrated global IP-based network. The Company offers a full range of secure data, voice, and video products to roughly 40% of the Fortune 500, as well as to 700 carriers, mobile operators and ISPs. It delivers services to more than 690 cities in more than 60 countries and six continents around the globe. GREENWICH STREET: Case Summary & Largest Unsecured Creditor ----------------------------------------------------------- Debtor: Greenwich Street Developers, LLC 133 Greewich Street New York, NY 10006 Case No.: 09-15440 Type of Business: The Debtor operates a real estate business. Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Allan L. Gropper Debtor's Counsel: Kevin J. Nash, Esq. Goldberg Weprin Finkel Goldstein LLP 1501 Broadway 22nd Floor New York, NY 10036 Tel: (212) 301-6944 Fax: (212) 422-6836 Email: KJNash@Finkgold.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Jacob Sabo. Debtor's List of 1 Largest Unsecured Creditor: Entity Nature of Claim Claim Amount ------ --------------- ------------ Airtek Environmental Corp. Unknown 39 W. 38th St. New York, NY 10018 HAIGHTS CROSS: Has Lenders' Support for Chapter 11 Filing, Plan --------------------------------------------------------------- Haights Cross Communications, Inc., said that on September 3, 2009, it entered into a plan support agreement with holders of 100% of its senior secured term loan and holders of more than 80% of its 11.75% Senior Notes pursuant to which the Company will pursue, among other things, a restructuring of the Company's Credit Agreement, 11.75% Senior Notes and HCC's 12.5% Senior Discount Notes. The planned restructuring is intended to substantially reduce the Company's outstanding indebtedness and improve cash flows, including cash flows available for investing in the Company's products and other growth opportunities. As this transaction is planned to be solely a restructuring of the Company's funded debt, no changes in the Company's operating businesses, Triumph Learning and Recorded Books, are planned in the restructuring. As such, the Plan Support Agreement contemplates that the Company's obligations to its trade creditors and employees will be unimpaired and paid in full. Paul J. Crecca, HCC's President and Chief Executive Officer, commented, "We are pleased to have reached an agreement with such a significant portion of our term loan lenders and noteholders on a long-term solution to improve our capital structure. The overall effect of the planned restructuring will be to reduce our existing indebtedness from over $380 million to approximately $180 million of new secured term debt, and extending the maturity of our debt until no earlier than three years from the effectiveness of the Plan. We believe this deleveraging and maturity extension will enable the Haights Cross companies to pursue important growth opportunities notwithstanding the current difficult economic conditions. Triumph Learning and Recorded Books plan to continue operations as normal through the Haights Cross debt restructuring, during which we plan to continue to acquire rights and publish new products, market and sell all of our products to all customer segments, and provide excellent customer service as we always have." Under the terms of the Plan Support Agreement, the Company intends to implement its debt restructuring through a prepackaged or pre- negotiated Chapter 11 filing. The lenders and noteholders party to the Plan Support Agreement have agreed to support the restructuring. The Company had entered into a number of forbearance agreements pursuant to which the Lenders agreed to forbear exercising any rights and remedies under the Credit Agreement primarily relating to certain financial covenant and reporting defaults. Under the most recent forbearance agreement, as extended on September 3, 2009, the Lenders have agreed to forbear exercising any rights and remedies relating to certain specified forbearance items with respect to the Credit Agreement until the occurrence of the Termination Date under and as defined in the Plan Support Agreement, subject to the right of earlier termination in certain other limited circumstances. Terms of the Chapter 11 Plan According to a filing with the Securities and Exchange Commission, the proposed Plan contemplates that on its effective date: -- reorganized HCOC will issue new first lien notes in an aggregate principal amount of $100 million, with a term of three years and interest accruing at a rate of LIBOR plus 1,000 basis points per annum (with a floor of 300 basis points per annum); -- reorganized HCOC will issue new second lien notes in an aggregate principal amount of $80 million, with a term of four years and interest accruing at a rate of LIBOR plus 1,300 basis points per annum (with a floor of 300 basis points per annum); -- all amounts owed under the terms of the Credit Agreement will be an allowed claim and repaid in full; provided, however, that in the event the Company, notwithstanding its commercially reasonable best efforts, is unable to procure financing (on terms no less favorable than those offered by the Plan Support Parties in the form of the New First Lien Notes) in an amount sufficient to be able to make such cash payment, each Lender shall receive New First Lien Notes in an aggregate principal amount equal to such allowed claim amount; -- each holder of a Senior Note will receive its pro-rata share of (i) the New Second Lien Notes; (ii) 92% of the issued and outstanding common stock of the reorganized Company, subject to dilution for a Rights Offering, if consummated, and any Exit Warrants; plus (iii) the proceeds of the Rights Offering; -- so long as the class representing the Senior Discount Notes has voted to accept the Plan, each holder of a Senior Discount Note will receive its pro-rata share of: (i) 8% of the issued and outstanding New Common Stock, subject to dilution for the Rights Offering, if consummated, and any Exit Warrants; (ii) a right to purchase New Common Stock pursuant to the Rights Offering; and (iii) the Exit Warrants; -- each allowed general unsecured claim, including trade creditors, will remain unimpaired and will be paid in full; and -- holders of common stock or other equity interests will not receive any amounts on account of their equity interests, which will be cancelled. If applicable, the Rights Offering will entitle each holder of a Senior Discount Note to participate in a $32.5 million rights offering to acquire New Common Stock. The Exit Warrants will have a term of three years and allow the holders to purchase up to 10% of the Company's New Common Stock as of the Plan Effective Date. The per share strike price of the warrants and per share exercise price of the rights will be based on: (i) the aggregate principal amount of the New First Lien Notes, plus (ii) the aggregate principal amount of the Senior Notes, plus accrued but unpaid interest thereon through the filing of petitions under Chapter 11 of the Bankruptcy Code, less (iii) the net cash of the reorganized Company on the Plan Effective Date in excess of $15 million. All ownership percentages described above will be subject to dilution for management incentive equity awards, if any. A copy of the Plan Support Agreement is available for free at: http://researcharchives.com/t/s?4497 About Haights Cross Communications Founded in 1997 and based in White Plains, NY, Haights Cross Communications is a premier educational and library publisher dedicated to creating the finest books, audio products, periodicals, software and online services, serving the following markets: K-12 supplemental education, public and school libraries, and consumers. Haights Cross companies include: Triumph Learning, Buckle Down Publishing and Options Publishing, and Recorded Books. For more information, visit www.haightscross.com. Triumph Learning is HCC' s test-preparation and intervention business and is comprised of its Coach, Buckle Down, and Options brands. Recorded Books is a leading publisher of unabridged audiobooks and other audio media for libraries, schools, and consumers, with operations in the U.S., U.K. and Australia. Haights had total assets of $232,388,000 against total debts of $432,741,000 as of June 30, 2009. GRAND SEAS RESORT: Files Chapter 11 in Miami -------------------------------------------- Grand Seas Resort Partners filed a Chapter 11 petition on Sept. 8 in Miami (Bankr. S.D. Fla. Case No. 09- 28973). The Company owes $14.2 million to secured lender Textron Financial Corp. Grand Seas filed Chapter 11 when Textron declared a default and cut off financing, Bloomberg's Bill Rochelle said. Grand Seas Resort Partners is the owner of a 175-unit time- share condominium on the oceanfront in Ormond Beach, Florida. The project has 800 unsold time-share units. It claims that its condominium project is worth $19 million. GREENWICH STREET DEVELOPERS: Files Chapter 11 in Manhattan ---------------------------------------------------------- Greenwich Street Developers LLC and affiliate Tampa Enclave 52 LLC filed Chapter 11 petitions on Sept. 9 in Manhattan (Bankr. S.D.N.Y. Case Nos. 09-15440 and 09-15441) to protect their properties from foreclosure. According to Bloomberg's Bill Rochelle, Greenwich owns an 8,800- square-foot parcel at 133 Greenwich Street in Manhattan that was to be developed into a 203-room luxury hotel. Tampa Enclave has 144 unsold units in a condominium project in Tampa, Florida. The Bloomberg report relates that U.S. Bank NA has a $39 million mortgage on the New York property, which doesn't generate income. The initiation of foreclosure prompted the Chapter 11 filing. Compass Bank has an $18 million mortgage on the Tampa project. Greenwich Street and Tampa Enclave are controlled by OFEK International Real Estate Ltd., which is in insolvency proceedings in Israel following the death last year of its principal, Elie Berdugo. HARRAH'S ENTERTAINMENT: Unit Proposes to Issue $720MM of Sr. Notes ------------------------------------------------------------------ Harrah's Entertainment, Inc., said its direct, wholly owned subsidiary, Harrah's Operating Company, Inc., is proposing to issue $720 million aggregate principal amount of senior secured notes due 2017 in a private offering that is exempt from the registration requirements of the Securities Act of 1933, as amended. The Notes are to be issued under the same indenture governing the 11-1/4% Senior Secured Notes due 2017 that were issued on June 10, 2009. On September 8, 2009, the Company priced $720,000,000 aggregate principal amount of 11-1/4% senior secured notes due 2017 at an issue price of 100.0%, plus accrued interest from June 10, 2009. The transaction is subject to a number of closing conditions. Harrah's intends to use the net proceeds from this private offering to repay a portion of Harrah's existing term loan and revolving credit indebtedness under HOC's senior secured credit facilities. The Notes are being offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act, and outside the United States, only to non-U.S. investors pursuant to Regulation S. The Notes will not be initially registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent an effective registration statement or an applicable exemption from registration requirements or a transaction not subject to the registration requirements of the Securities Act or any state securities laws. The Company filed Offering Memorandum Excerpts with the SEC. A full-text copy of the Disclosure in connection with the distribution of the offering memorandum for $720,000,000 aggregate principal amount of 11-1/4% senior secured notes due 2017, is available at no charge at http://ResearchArchives.com/t/s?4491 About Harrah's Entertainment Las Vegas, Nevada-based Harrah's Entertainment, Inc. -- http://www.harrahs.com/-- operates nearly 40 casinos across the United States, primarily under the Harrah's(R), Caesars(R) and Horseshoe(R) brand names; Harrah's also owns the London Clubs International family of casinos and the World Series of Poker(R). Private equity firms Apollo Global Management and TPG Capital LP acquired Harrah's in January for $31 billion. As of June 30, 2009, the Company had $30.7 billion in total assets and total current liabilities of $1.71 billion, long-term debt of $19.3 billion, deferred credits and other of $718.2 million, deferred income taxes of $5.74 billion, and preferred stock of $2.46 billion. As of March 31, 2009, the Company's consolidated condensed balance sheets showed total assets of $31.9 billion, total liabilities of $31.1 billion and preferred stock of $2.3 million, resulting to stockholders' deficit of $1.5 million. * * * The Troubled Company Reporter said June 15, 2009, that Standard & Poor's Ratings Services raised its corporate credit ratings on Harrah's Entertainment and Harrah's Operating to 'CCC+' from 'CCC', reflecting S&P's assessment that the recent capital raise, combined with an amendment to certain terms of HOC's senior secured credit facilities, has alleviated S&P's concerns that given S&P's expectation for operating performance this year, HOC would not be able to remain in compliance with its senior secured leverage ratio covenant. In addition, S&P raised the issue-level rating on HOC's senior secured credit facilities to 'B' (two notches higher than the 'CCC+' corporate credit rating) from 'B-'. The recovery rating on these loans remains at '1', indicating S&P's expectation of very high (90% to 100%) recovery for lenders in the event of a payment default. HARRAH'S OPERATING: S&P Affirms 'B' Rating on Senior Secured Notes ------------------------------------------------------------------ Standard & Poor's Ratings Services affirmed its issue-level and recovery ratings on the 11.25% senior secured notes due 2017 of Harrah's Operating Co. Inc., a wholly owned subsidiary of Harrah's Entertainment Inc. The affirmation follows a $720 million add-on to the notes, bringing the total size of the issue to about $2.1 billion. The notes are rated 'B' (two notches higher than the 'CCC+' corporate credit rating on the company) with a recovery rating of '1', indicating S&P's expectation of very high (90% to 100%) recovery for noteholders in the event of a payment default. Proceeds from the notes will predominantly be used to repay existing debt outstanding under the senior secured credit facility. Under the conditions of an amendment executed in conjunction with the $1.375 billion capital raise completed in early June 2009, as long as 90% of the proceeds from this capital raise are used to permanently reduce bank debt, these notes will be excluded from the senior secured leverage ratio covenant calculation. At the same time, S&P affirmed all of its existing ratings on HET and HOC, including the 'CCC+' corporate credit rating. The rating outlook is developing. "The 'CCC+' corporate credit rating reflects Harrah's weak credit metrics and limited liquidity," said Standard & Poor's credit analyst Ben Bubeck. "In addition, the rating reflects S&P's expectation for continued negative trends in net revenues and EBITDA over the next few quarters, which could challenge the company's ability to service its debt obligations given extremely thin EBITDA coverage of interest. The company's ability to weather the current downturn relies on a continued moderation of revenue and cash flow declines, or a further restructuring of its debt obligations." S&P upgraded its corporate credit rating on Harrah's in June 2009 to 'CCC+' from 'CCC' following the completion of a $1.375 billion capital raise, which was completed in conjunction with an amendment to certain terms of HOC's senior secured credit facilities. Those transactions alleviated S&P's concerns around Harrah's ability to remain in compliance with its senior secured leverage ratio covenant, despite S&P's expectation for weak operating performance this year. The proposed $720 million notes would further increase the company's cushion relative to its senior secured leverage ratio covenant, while modestly increasing interest expense. However, Harrah's credit measures remain weak. At the HET level, S&P expects operating lease-adjusted debt leverage, including $6.5 billion of commercial mortgage-backed securities debt and $2.5 billion of payment-in-kind preferred equity (which S&P consider debt-like), to increase to more than 12x by the end of 2009, and EBITDA coverage of interest to track around 1.0x. This incorporates S&P's expectation that EBITDA will fall in the mid- teens percentage area this year, largely due to continued weak visitation and spending trends in the Las Vegas and Atlantic City markets. HD SUPPLY: Moody's Reviews 'B3' Corporate Family Rating ------------------------------------------------------- Moody's Investors Service placed the B3 Corporate Family Rating and Probability of Default Rating of HD Supply, Inc. under review for possible downgrades. Additionally, these debt instruments were placed under review for possible downgrade: senior secured revolving credit facility due 2012, rated Ba3; senior secured revolving credit facility due 2013, rated Ba3; senior unsecured notes due 2014, rated Caa1; and, senior subordinated PIK notes due 2015, rated Caa2. In a related rating action Moody's affirmed the senior secured term loan due 2012 at Baa1, reflecting the guarantee provided by the Home Depot, Inc. The speculative grade liquidity rating remains SGL-2. The review of HDS' ratings will focus on the degree to which the company can generate free cash flow and improve its credit metrics in the face of eroding demand and tight credit markets. The review will also concentrate on the potential for additional debt repurchases at deep discounts since the company has about $3 billion of committed facilities maturing in 2012. HDS is highly leveraged driven due primarily to the large amount of debt incurred in a leveraged buyout in August 2007. For the last twelve months through May 3, 2009, EBIT/cash interest was under 0.5x and debt/EBITDA was 10.1x (all ratios adjusted per Moody's methodology). Moody's notes that the leverage would have been about 10.5x if HDS did not repurchase $267 million of debt and accrued interest in 1Q 05/09. The prospect of lower earnings due to the downturn in HDS' end markets could result in credit metrics worsening over the intermediate term. HDS' SGL-2 speculative grade liquidity rating reflects Moody's belief that the company will maintain a good liquidity profile over the next twelve months. Even though operating cash flow may be adversely impacted by the current downturn in the domestic economy, significant cash balances and availability under the company's committed credit facility should be adequate to make up any potential shortfalls in funding the company's normal operating requirements and capital spending needs. At 1Q 05/09 cash on hand totaled $587 million and availability under the asset-based revolving credit was $376 million, aggregating to $963 million in combined liquidity. The last rating action was on October 6, 2008, at which time Moody's downgraded the Corporate Family Rating to B3. HDS' ratings were assigned by evaluating factors Moody's believes are relevant to the credit profile of HDS, such as i) the business risk and competitive position of the company versus others within its industry, ii) capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of HDS' core industry and HDS' ratings are believed to be comparable to those of other issuers of similar credit risk. HD Supply, Inc., headquartered in Atlanta, Georgia, is one of the largest wholesale distributors supporting primarily three market sectors including Infrastructure and Energy; Maintenance, Repair & Improvement; and, Specialty Construction. HDS operates through nearly 790 locations throughout the U.S. and Canada serving contractors, government entities, maintenance professionals, home builders and professional businesses. Revenues for the last twelve months through May 3, 2009, totaled approximately $9.2 billion. HERCULES CHEMICAL: Files Chapter 11 Plan With Asbestos Trust ------------------------------------------------------------ Hercules Chemical Co. will seek approval of the disclosure statement explaining its proposed reorganization plan at a hearing on Oct. 5, Bill Rochelle at Bloomberg News reports. Mr. Rochelle relates that the Chapter 11 plan is designed to rid the Company of present and future asbestos personal injury claims. The Plan will create a trust to pay all asbestos claims. Unsecured creditors with an estimated $1.8 million in claims are to split $720,000, resulting to a recovery of about 40%. The employee stock ownership plan trust is to remain the company's owner. Hercules Chemical Co., Inc., filed for Chapter 11 bankruptcy protection on September 18, 2008, with the U.S. Bankruptcy Court for the District of New Jersey (Case No. 08-27822), blaming the costs of asbestos-related lawsuits. The asbestos suits arose from a furnace cement product made between 1939 and 1983. The Debtor first filed for bankruptcy on August 22, 2008, in the U.S. Bankruptcy Court for the Western District of Pennsylvania (Case No. 08-25553)) but the case was transferred to New Jersey, where it is incorporated. Gregory L. Taddonio, Esq., and Paul M. Singer, Esq., at Reed Smith LLP, represent the Debtor. Meyer, Unkovic & Scott LLP represents the Debtor's Future Asbestos Personal Injury Claimants. When the Debtor filed for protection from its creditors, it listed assets and debts between $10 million and $50 million. IDEARC INC: To Begin Soliciting Votes on Amended Plan ----------------------------------------------------- Idearc Inc. (Pink Sheets: IDARQ) said that the U.S. Bankruptcy Court for the Northern District of Texas, Dallas Division, has approved the disclosure statement filed in connection with Idearc's proposed First Amended Joint Plan of Reorganization and has authorized Idearc to begin the process for soliciting approval from eligible creditors for the Plan. With these developments, Idearc is positioned to emerge from Chapter 11 protection before year end. A confirmation hearing for the Court to consider approval of the Plan has been scheduled for early December 2009. Idearc expects to emerge from its reorganization process with an appropriate capital structure to support its future strategic business plans and objectives. Under the proposed Plan, the Company's total debt will be reduced from approximately $9 billion to approximately $2.75 billion of secured bank debt, with the remainder of the Company's current bank debt and bonds converted to new equity. Upon emergence from Chapter 11, the Company will have a cash balance of approximately $150 million. "The Court's approval of the Disclosure Statement and its authorization to begin the process for soliciting approval of our Plan, signals the latest step toward emergence from Chapter 11," said Scott W. Klein, chief executive officer of Idearc Inc. "In addition to this Plan - which strengthens our organization financially - we have been continuing with our mission of becoming America's advertising agency for local businesses. New initiatives benefiting consumers and businesses like our SuperGuaranteeSM and SuperTradeExchangeSM programs, and our focus on applying a more strategic approach to every facet of our business, is transforming Idearc for the future," Mr. Klein said. Notices of the confirmation hearing will be mailed to parties in interest. Upon confirmation of the Plan, current holders of Idearc's common stock will not receive any distributions following emergence and their equity interests will be cancelled and have no value once the Plan becomes effective. About Idearc Inc Headquartered in DFW Airport, Texas, Idearc, Inc. (NYSE: IAR) -- http://www.idearc.com/-- formerly known as Directories Disposition Corporation, provides yellow and white page directories and related advertising products in the United States and the District of Columbia. Products include print yellow pages, print white pages, Superpages.com, Switchboard.com and LocalSearch.com, the company's online local search resources, and Superpages Mobile, their information directory for wireless subscribers. Idearc is the exclusive official publisher of Verizon print directories in the markets in which Verizon is currently the incumbent local exchange carrier. Idearc uses the Verizon brand on their print directories in their incumbent markets, well as in their expansion markets. Idearc and its affiliates filed for Chapter 11 protection on March 31, 2009 (Bankr. N.D. Tex. Lead Case No. 09-31828). Toby L. Gerber, Esq., at Fulbright & Jaworski, LLP, represents the Debtors in their restructuring efforts. The Debtors have tapped Moelis & Company as their investment banker; Kurtzman Carson Consultants LLC as their claims agent. William T. Neary, the United States Trustee for Region 6, appointed six creditors to serve on an official committee of unsecured creditors of Idearc, Inc., and its debtor-affiliates. The Committee selected Mark Milbank, Tweed, Hadley & McCloy LLP, as counsel, and Haynes and Boone, LLP, co- counsel. The Debtors' financial condition as of Dec. 31, 2008, showed total assets of $1,815,000,000 and total debts of $9,515,000,000. INLET RETAIL: Inlet Square Sold to Secured Lender Rait ------------------------------------------------------ Inlet Retail Associates LLC, the owner of the Inlet Square mall in Murrells Inlet, South Carolina, is being sold to the lender Rait Partnership LP, the holder of an $18.7 million secured claim, Bill Rochelle at Bloomberg reported. The transaction is to be carried out through a Chapter 11 plan confirmed at the end of August. Rait is exchanging $3.5 million of debt for the mall. Headquartered in Irvine, California, Inlet Retail Associates, LLC, filed for Chapter 11 protection March 20, 2009, (Bankr. Case No.: 09-02083). Ivan N. Nossokoff, LLC, represents the Debtor in its restructuring efforts. The petition says that the Debtor has assets and debts of $10 million to $50 million. INT'L AEROSPACE: Existence Dependent on Halting Recurring Losses ---------------------------------------------------------------- International Aerospace Enterprises Inc.'s balance sheet at June 30, 2009, showed total assets of $1,325,172 and total liabilities of $18,974,953, resulting in a stockholders' deficit of $17,649,781. For three months ended June 30, 2009, the Company posted a net loss of $28,667,861 compared with a net loss of $319,163 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss of $30,038,885 compared with a net loss of $2,364,909 for the same period in 2008. The Company said that there is substantial doubt about its ability to continue as a going concern. The Company noted that for the six-month periods ended June 30, 2009, and 2008, the Company incurred operating losses of $30,308,885 and $2,364,909, respectively. In addition, the Company has a deficiency in stockholders equity of $17,649,781 and $3,462,694 at June 30, 2009, and Dec. 31, 2008, respectively. The Company added that its existence is dependent upon management's ability to develop profitable operations. The management is devoting substantially all of its efforts to establishing its business and there can be no assurance that the Company's efforts will be successful. However, the planned principal operations have not fully commenced and no assurance can be given that management's actions will result in profitable operations or the resolution of its liquidity problems. In order to improve the Company's liquidity, the Company is actively pursuing additional equity financing through discussions with investment bankers and private investors. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?446b International Aerospace Enterprises, Inc. (OTC:IARO) fka LifeStem International, Inc., is a provider of military aircraft spare parts. IAE's provides military aircraft spare parts to the United States Defense Department and its International Allies for the end users requiring spare parts in order to maintain their military aircraft. The Company's assembly, inventory storage, and shipping facilities are located in Covina, California. IRIDIUM OPERATING: Court Sends Plan to Creditors for Voting ----------------------------------------------------------- Iridium Operating LLC obtained approval from Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York of the disclosure statement explaining its proposed Chapter 11 plan of liquidation. Iridium will now send its plan for voting, which could dictate the outcome of the Chapter 11 case. According to court documents, Iridium Operating will seek conversion of its case to Chapter 7 liquidation if creditors don't vote in favor of the plan. Under the Plan, general unsecured claims will get less than 1% while stockholders get nothing. Secured claims will get 100 cents on the dollar. According to Bloomberg News, deadline to submit ballots is on October 19. If the solicitation of votes is successful, Iridium Operating will present its plan for confirmation at a hearing on October 28. On May 20, 2008, the Hon. James M. Peck of the United States Bankruptcy Court for the Southern District of New York approved a global settlement of disputes between Motorola, Inc., and Iridium. Approval of this settlement resolves in Motorola's favor, at no out of pocket cost to Motorola, all pending claims against the Motorola arising out of Iridium's bankruptcy proceedings. Under the settlement, Iridium was to distribute $16 million to unsecured creditors on claims of $1.6 billion, or a 1 percent recovery. The accord gave $34 million to bank lenders, along with a 5 percent interest in a related company, Iridium Holdings LLC, a parent of successor Iridium Satellite LLC. The current plan, filed Sept. 4 in bankruptcy court, provides for the distribution of assets to creditors as called for in the 2008 settlement, Tiffany Kary at Bloomberg relates. Bloomberg recalls that Iridium creditors claimed $4.3 billion against Motorola, and Motorola had claims worth $1.5 billion against Iridium for pre-bankruptcy contracts as well as a $675 million claim for bankruptcy administrative costs. Iridium also was pursuing recoveries from Motorola that it said were worth $2 billion, under a trust funded with $47 million to cover legal costs. Some of its claims included allegations that Motorola officials breached their fiduciary duty or had known that Iridium's bulky satellite phones, which often didn't work indoors, were destined to fail. About Iridium Operating Iridium Operating LLC used to develop and deploy global wireless personal communication systems. Iridium was a spinoff from Schaumburg, Illinois-based Motorola. It was formerly a unit of Motorola Inc. On August 19, 1999, some holders of Iridium's senior notes filed an involuntary chapter 11 petition (Bankr. S.D.N.Y. Case No: 99-45005) against Iridium and its subsidiary Capital Corp. At that time, the Debtors were highly leveraged with $3.9 billion in secured and unsecured debt. On the same date, Iridium and 7 other subsidiaries filed voluntary chapter 11 petitions in Delaware. They consented to the jurisdiction of the N.Y. Court in Sept. 7, 1999. William J. Perlstein, Esq., and Eric R. Markus, Esq., at Wilmer, Cutler & Pickering represent the Debtors in their restructuring efforts. John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP represent the petitioning creditors: Magten Partners, Wall Financial Investments (USA) Ltd., and Canyon Capital Advisors LLC, as Fund Manager for The Value Realization Fund, L.P. Bruce Weiner, Esq., at Rosenberg, Musso & Weiner LLP, represent the Official Committee of Unsecured Creditors. Iridium's operating unit sold all of its operating assets in 2000 to Iridium Satellite. JAZZ PHARMACEUTICALS: June 30 Balance Sheet Upside-Down by $89,000 ------------------------------------------------------------------ Jazz Pharmaceuticals, Inc.'s balance sheet showed total assets of $108,574,000 and total liabilities of $197,472,000, resulting in a stockholders' deficit of $88,898. For three months ended June 30, the Company reported a net income of $2,171,0000 compared with a net loss of $51,880,000 For six months ended June 30, the Company posted a net loss of $10,817,000 compared with a net loss of $98,589,000 for the same period in 2008. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4485 On March 26, 2009, Ernst & Young LLP in Palo Alto, California, expressed substantial doubt about Jazz Pharmaceuticals, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for the fiscal years ended Dec. 31, 2008, and 2007. The auditor noted the Company's recurring losses from operations and net capital deficiency. About Jazz Pharmaceuticals, Inc. Jazz Pharmaceuticals, Inc. -- http://www.jazzpharmaceuticals.com/ -- is a specialty pharmaceutical company that identifies, develops and commercializes innovative treatments for important, underserved markets in neurology and psychiatry. J O AND SONS: Case Summary & 18 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: J O and Sons LLP 300 South Orange Grove Blvd., Unit 2 Pasadena, CA 91105 Bankruptcy Case No.: 09-34258 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Central District of California (Los Angeles) 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 18 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cacb09-34258.pdf The petition was signed by James Yang, manager of the Company. JAZZ PRODUCTS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Jazz Products, LLC fdba Ribi Tech Products, LLC 110 Ethel Road W Unit 2 Piscataway, NJ 08854 Bankruptcy Case No.: 09-33687 Chapter 11 Petition Date: September 8, 2009 Court: United States Bankruptcy Court District of New Jersey (Trenton) Judge: Raymond T. Lyons, Jr. Debtor's Counsel: Timothy P. Neumann, Esq. Broege, Neumann, Fischer & Shaver 25 Abe Voorhees Drive Manasquan, NJ 08736 Tel: (732) 223-8484 Email: tneumann@bnfsbankruptcy.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/njb09-33687.pdf The petition was signed by Jack Benun, manager & CEO of the Company. JON J. PETERSON: Inconsistent Bidding Procedures Not Approved ------------------------------------------------------------- WestLaw reports that due process required that the bidding procedures for the sale of a Chapter 11 debtor's assets be consistent with the notice provided to creditors. Therefore, the bidding procedures had to allow a sale subject to the satisfaction of the same contingencies related to financing, environmental issues, and the exercise of due diligence during a similar period of 45 days from the execution of the winning bidder's contract as were included in the asset purchase agreement serving as the model for competing bids. The deletion of the contingencies from the bidding procedures would change a material provision of what the debtor had noticed to creditors. Although the debtor's counsel warned that the secured creditors could refuse their consent for an auction with contingencies, the secured creditors had to accept bidding procedures which satisfied the mandate for fairness if they desired the benefits of a sale in Chapter 11. In re Jon J. Peterson, Inc., --- B.R. ----, 2009 WL 2768954 (Bankr. W.D.N.Y.) (Bucki, J.). Jon J. Peterson, Inc., d/b/a Holiday Harbor, d/b/a Holiday Harbor Marina, owns and operates a marina located on the shores of Lake Chautauqua in the town of Celeron, N.Y. Its business includes the sale, restoration, storage and servicing of boats. On November 14, 2008, the corporation filed a chapter 11 petition (Bankr. W.D.N.Y. Case No. 08-15082). Asserting that the interests of creditors might best be served through a liquidation of assets, the debtor obtained an order dated April 23, 2009, which authorized the appointment of a real estate broker. After showing the property to several prospects, the broker identified The Boatworks, LLC, as a purchaser of virtually all of the debtor's assets for $1.3 million. On June 30, 2009, Boatworks and the debtor signed a purchase agreement. On August 20, 2009, Judge Bucki ruled that the debtor's motion to approve bidding procedures will be denied unless the auction is subject to the same contingencies recited in the Asset Purchase Agreement, and unless the proposed breakup fee is limited to $6,000. To the extent that the debtor and Boatworks can accept these provisions, Judge Bucki says, they may incorporate them into a revised order setting the terms and conditions of the bidding process. Daniel F. Brown, Esq., and Beth Ann Bivona, Esq., at Damon Morey LLP, in Buffalo, N.Y., represent the Debtor. KEARNEY CONSTRUCTION: Taps Stichter Riedel as Counsel ----------------------------------------------------- Kearney Construction Co. LLC asks the U.S. Bankruptcy Court for the Middle District of Florida for permission to employ Stichter, Riedel, Blain & Prosser P.A., as its counsel. The firm has agreed to, among other things: a) render legal advice with respect to the Debtor's powers and duties as a debtor in possession, the continued operation of the Debtor's business, and the management of its property; b) prepare on behalf of the Debtor necessary motions, applications, orders, reports, pleadings, and other legal papers; c) appear before this Court, any appellate courts, and the United States Trustee to represent and protect the interests of the Debtor; d) take all necessary legal steps to confirm a plan of reorganization; and e) represent the Debtor in all adversary proceedings, contested matters, and matters involving administration of this case, both in federal and in state courts. Papers filed with the Court did not disclose the firm's hourly rates for its professionals. The Debtor assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Florida-based Kearney Construction Co. LLC is among the oldest and largest site developers in the Tampa Bay area. It was founded in 1956. It has done site development on many largest commercial projects in the region, including International Plaza at Bay Street and Citrus Park Mall. The Company filed for Chapter 11 bankruptcy protection on August 26, 2009 (Bank. M.D. Fla. Case No. 09-18848). Kearney Construction Company, Inc.; AVT Equipment, LLC; Florida Equipment Co., LLC; Florida Equipment Co., LLC; and Florida Trucking Company, Inc., also filed for bankruptcy. Stephen R. Leslie, Esq., at Stichter, Riedel, Blain & Prosser, assists in Kearney Construction's restructuring efforts. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. KEARNEY CONSTRUCTION: Wants to File Schedules by September 25 ------------------------------------------------------------- Kearney Construction Co., LLC, and its debtor-affiliates ask the U.S. Bankruptcy Court for the Middle District of Florida to extend until Sept. 25, 2009, the time to file their schedules of assets and liabilities and statements of financial affairs. Headquartered in Tampa, Florida, Kearney Construction Co., LLC, operates a construction business. The Company and certain of its affiliates filed for Chapter 11 on Aug. 26, 2009 (Bankr. M.D. Fla. Case No. 09-18848). Two if its debtor-affiliates filed for separate Chapter 11 on June 4, 2009. Stephen R. Leslie, Esq., at Stichter, Riedel, Blain & Prosser, represents the Debtors in their restructuring efforts. In their petition, Kearney listed assets and debts both ranging from $10,000,001 to $50,000,000. LANDRY'S RESTAURANTS: Taps Moelis as Financial Advisor; Sale Poss. ------------------------------------------------------------------ Landry's Restaurants, Inc., reported that on August 14, 2009, its Board of Directors appointed a special committee comprised of independent directors of the Company and authorized the Special Committee to review strategic alternatives for the Company, including a possible sale of the Company. The Special Committee has retained independent legal advisors and engaged Moelis & Company LLC as its financial advisor. On September 4, 2009, the Special Committee received a letter from Tilman J. Fertitta, Chairman, President and CEO, expressing his desire to enter into formal discussions with the Special Committee regarding a going-private transaction and a related tax-free spin- off of the Company's wholly-owned subsidiary, Saltgrass, Inc. In the transaction, Mr. Fertitta would acquire all of the shares of the Company's common stock that he does not currently own and the Company's stockholders, including Mr. Fertitta, would receive shares of Saltgrass in exchange for their shares of the Company's common stock. The stockholders other than Mr. Fertitta would receive a greater percentage of shares of Saltgrass than would Mr. Fertitta. It is expected that Saltgrass would be a reporting company under the Securities Exchange Act of 1934, as amended, and would be listed for trading on a national securities exchange as of the closing of the transaction. Mr. Fertitta further indicated that he would be willing to have approval of the transaction conditioned on the affirmative vote of the holders of a majority of the Company's common stock not owned by him. Mr. Fertitta also noted as part of the transaction that he anticipated refinancing the Company's outstanding debt and Saltgrass would have stand- alone debt at an appropriate level with terms supportive of higher unit growth. The Special Committee has informed Mr. Fertitta that it will not be prepared to make a recommendation regarding any transaction with him, if at all, unless and until such time that it has had the opportunity to explore alternative proposals and concludes that in its business judgment it believes that Mr. Fertitta's proposal is superior to any other proposal. There can be no assurance that any agreement on financial or other terms satisfactory to the Special Committee will be reached with Mr. Fertitta. There can be no assurance regarding the timing of or whether the Special Committee will elect to pursue any of the strategic alternatives it may consider, or that any such alternatives will result in changes to the Company's plans or will be consummated and there is no certainty that any strategic alternative will involve a transaction for shareholders at a share price equal to or above the current trading price of the Company's shares. About Landry's Restaurants Landry's Restaurants, Inc., is a national, diversified restaurant, hospitality and entertainment company principally engaged in the ownership and operation of full-service, casual dining restaurants, primarily under the names of Rainforest Cafe, Saltgrass Steak House, Landry's Seafood House, Charley's Crab, The Chart House, and the Signature Group of restaurants. The Company is also engaged in the ownership and operation of select hospitality businesses, including the Golden Nugget Hotel & Casino in Las Vegas and Laughlin, Nevada. As reported by the TCR on July 28, 2009, Standard & Poor's Ratings Services said that it revised the outlook on the Houston, Texas- based Landry's Restaurants Inc. to negative from stable. At the same time, S&P affirmed the 'B' ratings on Landry's. This action was taken in conjunction with S&P's lowering the rating on the Company's unrestricted subsidiary, the Las Vegas-based Golden Nugget Inc., to 'CC' from 'B-'. The outlook on Golden Nugget is negative. According to the TCR on July 28, 2009, Moody's Investors Service affirmed the B2 Corporate Family Rating and Probability of Default Rating of Landry's Restaurants Inc. and changed the outlook to negative. LANDRY'S RESTAURANTS: S&P Puts 'B' Ratings on CreditWatch Negative ------------------------------------------------------------------ Standard & Poor's Rating Services said that it placed all ratings, including the 'B' corporate credit rating, on Houston based- Landry's Restaurants Inc. on CreditWatch with negative implications. "We took this action after the company announced that a special committee comprised of independent directors will review strategic alternatives, which includes a possible sale of the company. The company's CEO and majority shareholder, Tilman Fertitta, sent a letter to the special committee indicating his interest to enter formal discussions regarding a going-private transaction, in which Fertitta would acquire all the common stock that he does not own and at the same time the company would spin-off its wholly owned subsidiary Saltgrass Inc. The letter also indicated that he anticipated refinancing the company's current debt as part of the transaction. The likely timeframe of the review of the strategic alternatives and the company's near-term maturity profile (its senior secured credit facility matures in May of 2011 and its senior notes in August of 2011) will likely necessitate that the debt be refinanced as part of any resulting transaction. Moreover, the company's current credit agreement and note indenture has asset sale provisions that S&P believes would inhibit a pure equity spin-off of Saltgrass Inc., which S&P feels increases the likelihood of refinancing. If the company raised additional debt to fund a going-private transaction or if new debt allowed for greater support to the company's unrestricted subsidiary, the Golden Nugget Inc. (CC/Negative/--), the ratings and the company's credit metrics could be strained. Once the Special Committee has reached a decision about the review of strategic alternatives and corresponding financing plans, S&P will examine the terms of the outcome and take the appropriate rating actions at the point. LEXICON UNITED: June 30 Balance Sheet Upside-Down by $1 Million --------------------------------------------------------------- Lexicon United Inc.'s balance sheet at June 30, 2009, showed total assets of $3,098,595 and total liabilities of $4,107,598, resulting in a stockholders' deficit of $1,009,003. For three months ended June 30, 2009, the Company posted a net loss of $107,824 compared with a net loss of $120,815 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss $349,109 compared with a net loss of $414,046 for the same period in 2008. The Company said that there is substantial doubt about its ability to continue as a going concern. The Company noted that it has an accumulated deficit of $3,279,266 and negative working capital of $3,175,147 at June 30, 2009. The management's plans include raising adequate capital through the equity markets to fund future operations and generating of revenue through its businesses. Failure to raise adequate capital and generate adequate sales revenues could result in the Company having to curtail or cease operations. Additionally, even if the Company does raise sufficient capital to support its operating expenses and generate adequate revenues, there can be no assurances that the revenue will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?446f Lexicon United Inc. was incorporated on July 17, 2001, in the state of Delaware. The company was a blank check company and had no operations other than organizational matters and conducting a search for an appropriate acquisition target until Feb. 27, 2006, when it completed an acquisition transaction with ATN Capital E Participacoes Ltda, a Brazilian limited company that had commenced business in April 1997. ATN is engaged in the business of managing and servicing accounts receivables for large financial institutions in Brazil. LIFE SCIENCES: Consolidated Amended Class Action Filed ------------------------------------------------------ Life Sciences Research, Inc., reports that, on August 29, 2009, a Consolidated Amended Class Action and Derivative Complaint was filed with respect to the proposed merger of the Company with and into Lion Merger Corp. -- Merger Sub -- an entity controlled by Andrew Baker, the Chairman and Chief Executive Officer of the Company, contemplated by the Agreement and Plan of Merger, dated July 8, 2009, by and among the Company, Lion Holdings, Inc. and Merger Sub. The complaint combines and supplements the two previously disclosed existing actions brought with respect to the Merger: Berger v. Life Sciences Research, et al., which was originally filed on March 9, 2009, and was amended on July 13, 2009, and Oakland v. Life Sciences Research, Inc., et al., which was filed on August 10, 2009. The consolidation of the two actions is subject to court approval. The Consolidated Complaint was filed in the Superior Court of New Jersey, Chancery Division, Somerset County (Civil Action No. SOM- C-12006-09) and names as defendants the Company, Mr. Baker and the other members of the Company's Board of Directors. The Consolidated Complaint, which makes both direct and derivative claims, alleges, among other things, that the directors breached their fiduciary duties in connection with the Merger by agreeing to sell the Company for an unfair price pursuant to an unfair process and by filing and circulating a proxy statement with materially misleading disclosures and omissions, that Mr. Baker controls the Company and its directors, that the directors were motivated to accept Mr. Baker's offer because of concerns that a public dispute with Mr. Baker would draw unwanted attention from animal rights activists, that certain terms of the merger agreement unfairly benefit Mr. Baker at the expense of the other stockholders, including the absence of appraisal rights and provisions providing for accelerated vesting of restricted stock, restrictions on the solicitation of negotiations with respect to third party proposals and termination fees, and that the Company, Mr. Baker and the Company's other directors each aided and abetted the other defendants' breach of their fiduciary duties. The complaint seeks injunctive and other unspecified relief. The Company is responding appropriately to the lawsuit. About Life Sciences Research Headquartered in East Millstone, New Jersey, Life Sciences Research Inc. (NYSE Arca: LSR) -- http://www.lsrinc.net/-- is a global contract research organization providing product development services to the pharmaceutical, agrochemical and biotechnology industries. LSR operates research facilities in the United States and the United Kingdom. As of June 30, 2009, the Company had $183,594,000 in total assets and $191,293,000 in total liabilities, resulting in $7,699,000 in stockholders' deficit. LINDALE PRIME LAND: Development Parcel Scheduled for Auction ------------------------------------------------------------ National Commercial Auctioneers, LLC, announced September 10 the auction of 14.577 +/- acre prime development parcel in Lindale, Texas, a suburb of the fast growing Tyler Metropolitan area, pursuant to a confirmed Chapter 11 plan in the Lindale Prime Land Source, L.P. Bankruptcy in the Eastern District of Texas. "The sale is free and clear of all liens, claims and encumbrances," noted Michael S. Thomas, the court-appointed Liquidating Agent. "This is one of the biggest benefits of buying property at a bankruptcy auction. When you buy it, you know it's yours since a federal judge gives you the title through a federal order." The property, located off of W. Centennial Blvd, is one of the hottest development areas near Tyler in the heart of the US69/Centennial Blvd corridor. Adjacent to the property is a Comfort Inn & Suites and a LaQuinta as well as a major Trinity Mother Frances Medical facility. Across the street is a new Lowe's, Wal-Mart, Chili's, Sonic and other major retail tenants. "Our property has frontage on two streets allowing for many different development options. With the major retail nearby, it would be a great site for additional retail, office or medical use," noted Stephen Karbelk, President of NCA. "East Texas Medical Center owns a large parcel across the street," commented Alan Y. Jones, Regional Vice President for NCA. "The particular area, known as the I-20 North Parallel Corridor and I- 20 and Highway 69 Gateway, continues to get private and public investment dollars. There are plans to extend Centennial Blvd to Loop 49 making this area even more accessible to consumers in the future." "If there were ever a time to buy exceptionally well-located commercial land, now would be the time. When the US Bankruptcy Court orders a property to be sold, the buyers need to participate. There is no telling how good of a deal they could get," commented Thomas. National Commercial Auctioneers -- http://www.natcomauctions.com/ -- is a nationwide real estate auction company that specializes in the sale of commercial real estate at auction for bankers, receivers and bankruptcy courts. For more information, please visit www.natcomauctions.com or call 877-895-7077. In Texas, National Commercial Auctioneers, LLC trades as NCA Auctioneers. About Lindale Prime Land Lindale Prime Land Source, L.P., filed for Chapter 11 on October 7, 2008 (Bankr. E.D. Tex. Case No. 08-60939). Jim Echols, Esq., at Saunders, Schmidt, Echols, Ring & Heck, P.C., represents the Debtor in its restructuring effort. The petition says that assets and debts are between $1 million and $10 million. LIZ CLAIBORNE: Liquidity More Than Sufficient, CEO Says ------------------------------------------------------- The Associated Press reports that Liz Claiborne Inc. shares rose 42 cents, or 10%, to $4.54 on Wednesday after CEO William L. McComb said that the Company's liquidity is more than sufficient. "We have more than sufficient liquidity and we are not concerned at this point about our liquidity metrics," The AP quoted Mr. McComb as saying. Liz Claiborne hired turnaround firm Alvarez & Marsal a short-term basis to help its business, but that doesn't signal anything else about the company's future, the report says, citing Mr. McComb. According to The AP, Mr. McComb expects 2010 to be an improvement on this year, as new behavior patterns become more firm. Mr. McComb, The AP relates, said, "I think we're a lot more bullish on the back half of 2010 than we are the first half that's for sure, but I think the theme that I would lay out is a more predictable pattern which will allow better planning." Liz Claiborne Inc. -- http://www.lizclaiborneinc.com/-- designs and markets a global portfolio of retail-based premium brands including Kate Spade, Juicy Couture, Lucky Brand and Mexx. The Company also has a refined group of department store-based brands with strong consumer franchises including the Liz Claiborne and Monet families of brands, Kensie, Kensiegirl, Mac & Jac, and the licensed DKNY Jeans Group. * * * As reported by the TCR on August 19, 2009, Standard & Poor's Ratings Services lowered its corporate credit rating on New York- based Liz Claiborne Inc. to 'B' from 'BB-'. The outlook is negative. S&P also lowered the senior unsecured debt rating to 'B-'. The recovery rating remains '5', indicating S&P's expectation of modest (10% to 30%) recovery in the event of a payment default. As of July 4, 2009, Liz Claiborne had about $1.6 billion of debt outstanding (including capitalized operating leases). According to the TCR on August 17, 2009, Moody's Investors Service lowered Liz Claiborne Inc's Corporate Family Rating and Probability of Default Rating to B2 from Ba3. The Company's EUR 350 million senior unsecured notes were lowered to Caa1 (LGD 5, 83%) from B2 (LGD 5, 85%). All of the Company's ratings were placed on review for further possible downgrade. LOCAL INSIGHT: S&P Assigns 'B' Rating on CreditWatch Negative ------------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B' rating on Englewood, Colorado-based Local Insight Regatta Holdings Inc. on CreditWatch with negative implications. "The CreditWatch listing reflects near-term refinancing risk surrounding approximately $134 million of debt outstanding (as of June 30, 2009), which matures Sept. 30, 2009, and is currently held at LIM Finance, an indirect subsidiary of Local Insight Media Holdings L.P.," said Standard & Poor's credit analyst Ariel Silverberg. There is also $108 million of debt outstanding at LIM Finance II, also an indirect subsidiary of LIMH, which matures in June 2010. It is S&P's belief the company would seek to refinance both pieces of debt at the same time. LIMH is owned by Welsh, Carson, Anderson & Stowe, Spectrum Equity Investors, and certain members of management. LIMH directly owns Caribe Media Inc., and, along with separate WCAS funds, owns Local Insight Media Holdings Inc., LIRH's indirect parent. Holdings also owns the whole business securitization, consisting of ACS Media (the incumbent yellow page publisher in Alaska), CBD Media (the incumbent yellow page publisher in Cincinnati), and HYP Media (the incumbent yellow page publisher in Hawaii). Given the strategic relationships between, and common management and ownership of, the various operating entities, S&P view the rating of each individual entity based on a global view of the creditworthiness of all other entities. S&P expects decisions in support of the owners' operating and financial strategies will be made with a view toward the collective group of companies. The refinancing risk at LIRH affiliate LIM Finance is of particular concern given S&P's expectation for a potential near- term breach of the leverage covenant under the WBS of Holdings. The WBS funds debt service at its intermediate holding company LIM Finance, which faces the refinancing risk. The WBS is collateralized by assets at ACS Media, CBD Media, and HYP Media. Lower retained collections, primarily from HYP and CBD, is the primary cause of the lower-than-expected net securitizable cash flow, which is used to determine leverage for purposes of the covenant. While S&P expects the company will utilize an equity cure to avoid a breach of the leverage trigger (which S&P expects will be funded through cash flow from LIRH and/or Caribe), S&P expects this near-term event could create challenges for LIMH to obtain external refinancing at favorable terms. While the LIM Finance and LIM Finance II debt is guaranteed by investment funds of owner WCAS, the guarantee would only likely be used in the event LIM Finance cannot attract sufficient external capital to refinance its maturing debt. In resolving S&P's CreditWatch listing, S&P will assess the terms of any new planned financing at LIM Finance and LIM Finance II. In the event management is unable to obtain external financing and requires support from owner WCAS, ratings would likely go lower by at least one notch given S&P's belief this would be indicative of an inability of the LIM companies to attract sufficient levels of external capital to support its capital structure. S&P will also address S&P's expectation for consolidated operating performance over the intermediate term in resolving the CreditWatch listing. LOEHMANN'S HOLDINGS: S&P Cuts Corporate Credit Rating to 'CC' ------------------------------------------------------------- Standard & Poor's Rating Services said that it lowered its corporate credit rating on New York City-based Loehmann's Holdings, Inc., to 'CC' from 'CCC+'. At the same time, S&P lowered the rating on subsidiary Loehmann's Capital Corp.'s $110 million senior secured notes to 'C' from 'CCC-'. The downgrade reflects further operational deterioration, continued erosion of the company's liquidity position, and expectations for continued poor performance. "The speculative-grade ratings on Loehmann's reflect participation in the highly competitive off-price apparel retailing market, small cash flow base, poor operating history, high debt leverage, and extremely weak liquidity position," said Standard & Poor's credit analyst David M. Kuntz. The rating also indicates that the company is vulnerable to default. Operating performance for Loehmann's remains poor. Standard & Poor's Ratings Services anticipates operations are likely to be increasingly challenged in the near term given the history of weak performance combined with the difficult retail environment. Revenues continue to fall on declines in comparable-store sales and store closures, and margins remain pressured by sustained operational deleveraging. The continued poor performance has resulted in very thin credit protection metrics. S&P expects the company's credit protection profile to remain extremely weak over the near term. At debt to EBITDA of 878.4x and interest coverage of less than 0.1x as of May 2, 2009, the credit metrics are not meaningful numbers. MAGNA ENTERTAINMENT: TRAC Wants to Bid for Santa Anita Park ----------------------------------------------------------- Janette Williams at Pasadena Star-News reports that the Thoroughbred Racing Association of California, a four-member track-acquisition committee, is trying to put together a bid for Magna Entertainment Corp.'s Santa Anita Park. Star-News relates that TRAC wants to run the park as its nonprofit arm. The report quoted TRAC chairperson Arnold Zetcher as saying, "Our whole objective is to preserve quality horse-racing in California. We've actually been working on this for several months. We're putting together a `not-for-profit,' which doesn't mean we don't want to make a profit -- we do. We want to take the money and put it into the purse structure." As reported by the TCR on September 9, 2009, the September 8 auction for the Santa Anita Park was postponed. Michael Wildish, a managing editor with Miller Buckfire, advisor to Magna, said that while there has been a "lot of interest" for the racetrack, no baseline bid was received by the July 31 deadline. Ron Charles, Santa Anita's president and CEO, said potential bidders were reluctant to initiate bidding, fearing that they would overpay for the property. A stalking horse bid could come in late October, and the bidding process would follow in about 30 days, Star-News states, citing Santa Anita Park President and CEO Ron Charles. According to the report, Mr. Charles said that he believes the TRAC committee is "very serious about trying to put together a bid," but no minimum offer had been discussed. Magna Entertainment Files 10th Default Status Report Magna Entertainment filed this news release as its 10th bi-weekly default status report under National Policy 12-203 of the Canadian Securities Administrators, pursuant to which Magna Entertainment announced that it would not be filing its Annual Report on Form 10-K for the fiscal year ended December 31, 2008, nor would it be filing quarterly reports on Form 10-Q, with the U.S. Securities and Exchange Commission or the Canadian securities regulators during the period it continues to operate its business as a debtor-in-possession under the U.S. Bankruptcy Code. Since announcing the original notice of default on March 26, 2009, and filing its first default status report on April 7, 2009, its second default status report on April 28, 2009, its third default status report on May 29, 2009, its fourth default status report on June 12, 2009, its fifth default status report on June 26, 2009, its sixth status report on July 10, 2009, its seventh status report on July 24, 2009, its eighth on August 7, 2009, and its ninth on August 25, 2009, there have not been any material changes to the information contained therein, nor any failure by Magna Entertainment to fulfill its intentions stated therein, and there are no additional defaults or anticipated defaults subsequent thereto. The Company intends to file its next default status report on September 23, 2009. About Magna Entertainment Based in Aurora, Ontario, Magna Entertainment Corp. is North America's largest owner and operator of horse racetracks based on revenue. The Company develops, owns and operates horse racetracks and related pari-mutuel wagering operations, including off-track betting facilities. MEC also develops, owns and operates casinos in conjunction with its racetracks where permitted by law. MEC owns and operates AmTote International, Inc., a provider of totalisator services to the pari-mutuel industry, XpressBet(R), a national Internet and telephone account wagering system, as well as MagnaBet(TM) internationally. Pursuant to joint ventures, MEC has a 50% interest in HorseRacing TV(R), a 24-hour horse racing television network, and TrackNet Media Group LLC, a content management company formed for distribution of the full breadth of MEC's horse racing content. Following its failure to meet obligations to lenders led by PNC Bank, National Association, and Wells Fargo Bank, National Association, and controlling shareholder MI Developments Inc.'s decision not to provide further financial backing, Magna Entertainment Corp. and 24 affiliates filed for Chapter 11 on March 5, 2009 (Bankr. D. Del. Lead Case No. 09-10720). Marcia L. Goldstein, Esq., and Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, have been engaged as bankruptcy counsel. Mark D. Collins, Esq., L. Katherine Good, Esq., and Maris J. Finnegan, Esq., at Richards, Layton & Finger, P.A., are the Debtors' local counsel. Miller Buckfire & Co. LLC is the Debtors' investment banker and financial advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent for the Debtors. Magna Entertainment Corp. had total assets of US$1.054 billion and total liabilities of US$947.3 million based on unaudited consolidated financial statements as of December 31, 2008. MANNEY REALTY: Case Summary & 19 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Manney Realty, Inc. 1608 East 12th Avenue Hibbing, MN 55746 Bankruptcy Case No.: 09-51197 Chapter 11 Petition Date: September 8, 2009 Court: United States Bankruptcy Court District of Minnesota (Duluth) Judge: Gregory F. Kishel Debtor's Counsel: Greg C. Gilbert, Esq. Gilbert Law Office Duluth Technology Village Suite 563, 11 East Superior Street Duluth, MN 55802 Tel: (218) 625-8777 Email: ggilbert@superiorlaw.net Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $2,496,000, and total debts of $1,916,824. 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/mnb09-51197.pdf The petition was signed by Timothy H. Manney, president of the Company. MCGRATH HOTEL: Involuntary Chapter 11 Case Summary -------------------------------------------------- Alleged Debtor: McGrath Hotels, LLC 6 Guthrie Place New London, CT 06320 Case Number: 09-22532 Involuntary Petition Date: September 4, 2009 Court: District of Connecticut (Hartford) Judge: Albert S. Dabrowski Petitioner Nature of Claim Claim Amount ----------- --------------- ------------ Lighthouse Group of mortgage/note $1,986,544 Connecticut 245 Long Hill Road Middletown, CT 06457 MERIDIAN RESOURCE: Gets Forbearance from Lenders; Milestones Set ---------------------------------------------------------------- The Meridian Resource Corporation is party to the Amended and Restated Credit Agreement, dated as of December 23, 2004, as amended by the First Amendment to Credit Agreement dated as of February 25, 2008, and further amended by the Second Amendment to Credit Agreement dated as of December 19, 2008, by and among the Company, as borrower, Fortis Capital Corp., as administrative agent, sole lead arranger and bookrunner, and the other lenders and agents party thereto. Under the Fortis Credit Facility, the Company's most recent scheduled redetermination of its borrowing base was effective April 30, 2009, at which time the borrowing base was reduced to $60 million from $95 million. As of the date of the redetermination, the Company had fully borrowed under itsborrowing base and had outstanding indebtedness of $95 million under the Fortis Credit Facility. The Fortis Credit Facility provides that outstanding borrowings in excess of the borrowing base must be repaid within 90 days after the redetermination. Accordingly, a $35 million payment to the Lenders under the Fortis Credit Facility for the borrowing base deficiency was due July 29, 2009. The Company did not have sufficient cash on hand on July 29 to repay the shortfall and do not have sufficient cash currently. Consequently, the Company has failed to pay when due the full amount of such borrowing base deficiency pursuant to the terms of the Fortis Credit Facility, and are in default. In addition to such default for failure to pay the borrowing base deficiency, there are other covenant defaults, including financial covenants, existing under the Fortis Credit Facility. On September 3, 2009, the Company and certain of its subsidiaries entered into a Forbearance and Amendment Agreement with Fortis and the other Lenders under the Fortis Credit Facility. The Fortis Forbearance Agreement provides that the Lenders will forbear from exercising any right or remedy arising as a result of the existing events of default under the Fortis Credit Facility that are listed in the Fortis Forbearance Agreement until the earlier of: (a) 5:00 p.m. (CST) on the earlier of (1) the date which is 91 days following the date of the Orion Forbearance Agreement (defined below) and (2) December 4, 2009; or (b) the date that any default occurs under the Fortis Forbearance Agreement. The forbearance does not constitute a waiver by the Lenders of any such events of default. The Fortis Forbearance Agreement will terminate, however, on September 30, 2009 if, by that date, the Company has not entered into (a) a merger agreement pursuant to which the Company will merge with or into or be acquired by or transfer all or substantially all of its assets to another person; (b) a capital infusion agreement pursuant to which one or more persons will contribute subordinated debt or equity capital to the Company in an amount sufficient to enable the Company to pay to the Lenders an amount equal to 100% of the borrowing base deficiency; or (c) a purchase and sale agreement pursuant to which the Company agrees to sell one or more oil and gas properties for net proceeds sufficient to enable the Company to pay to the Lenders an amount equal to 100% of the borrowing base deficiency, plus any incremental borrowing base deficiency resulting from such sales. In each case, the transaction must be consummated by October 30, 2009, unless such date is extended with the consent of Lenders representing 66-2/3% of its borrowings under the Fortis Credit Facility, but shall in no event be later than December 31, 2009. As required by the Fortis Forbearance Agreement, on September 3, 2009, the Company paid its Lenders an aggregate of $2.0 million of principal owed under the Fortis Credit Facility. On or before each of September 10, October 9, November 10 and December 10, 2009, it will be required to pay to the Lenders principal amounts of the greater of (a) 100% of its Excess Cash Flow for the months of August, September, October and November 2009, respectively, and (b) $1 million. The Company will also be required to pay its Lenders a forbearance fee of approximately $945,000, one-fourth of which, or $236,250, the Company paid on September 3, 2009, and one-fourth of which is payable on each of October 3, November 3 and at the end of the forbearance period. After the principal payments that were made on September 3, 2009, the Company owes $92.5 million under the Fortis Credit Facility and the borrowing base deficiency is $32.5 million. In addition, the Company will make a $1 million principal payment on September 10 in accordance with the Fortis Forbearance Agreement. The Fortis Forbearance Agreement places other restrictions on the Company with respect to capital expenditures, sales of assets, and incurrence and prepayments of other indebtedness and amends the Fortis Credit Facility in certain respects. Forbearance Agreement under Hedge Contracts As a result of the payment default for the borrowing base deficiency and financial covenant defaults under the Fortis Credit Facility, the Company is also in default under hedging agreements it has entered into with certain affiliates of Fortis Capital Corp. due to cross default provisions therein. Concurrently with the execution of the Fortis Forbearance Agreement, the Company and its subsidiaries entered into a Forbearance Agreement with Fortis Capital Corp. and Fortis Energy Marketing & Trading GP that provides that FEMT will forbear from exercising any and all of its rights or remedies arising as a result of the existing events of default under the Hedge Agreements that are listed in the Hedge Forbearance Agreement until the earlier of (a) 5:00 p.m. (CST) on the earlier of (1) the date which is 91 days following the date of the Orion Forbearance Agreement or (2) November 30, 2009 (subject to extension in certain circumstances with the consent of FEMT); or (b) the date that any default occurs under the Hedge Forbearance Agreement. Such forbearance does not constitute a waiver by FEMT of any such events of default. Forbearance and Amendment Agreement under CIT Credit Agreement One of the Company's subsidiaries, TMR Drilling Corporation, is a party to the Credit Agreement, dated as of May 2, 2008, among TMR Drilling, as borrower, The CIT Group/Equipment Financing, Inc., as administrative agent and lender, and the Company and The Meridian Resource & Exploration LLC, another of the Company's subsidiaries, as guarantors, pursuant to which TMR Drilling financed the purchase of a land based drilling rig designated as Rig No. 8, known as the "Triton Rig", from Orion Drilling Company, LLC. As a result of the payment default for the borrowing base deficiency and financial covenant defaults under the Fortis Credit Facility, the Company is also in default under the CIT Credit Agreement due to cross default provisions contained therein. Concurrently with the execution of the Fortis Forbearance Agreement, the Company, TMR Drilling and TMR Exploration entered into a Forbearance and Amendment Agreement with CIT that provides that CIT will forbear from exercising any and all of its rights and remedies arising as a result of the existing events of default under the CIT Credit Agreement that are listed in the CIT Forbearance Agreement until the earlier of (a) 5:00 p.m. (CST) on the earlier of (1) the date which is 91 days following the date of the CIT Forbearance Agreement or (2) December 4, 2009 (subject to extension in certain circumstances with the consent of CIT); or (b) the date that any default occurs under the CIT Forbearance Agreement. Such forbearance does not constitute a waiver by CIT of any such events of default. Pursuant to the CIT Forbearance Agreement, the Company paid to CIT on the date the Company executed the CIT Forbearance Agreement (a) a principal prepayment of $1 million and (b) a forbearance fee of 0.75% of the outstanding indebtedness under the CIT Credit Agreement, or $49,856. After the $1 million principal prepayment, the Company owes approximately $6.6 million under the CIT Credit Agreement. The Company will continue to make principal and interest payments of approximately $220 thousand per month in accordance with the CIT Credit Agreement. Forbearance and Amendment Agreement under Orion Drilling Contracts and the Equipment Lease TMR Drilling and Orion are parties to an Equipment Lease (Rig No. 8) dated as of February 12, 2007, as amended from time to time, pursuant to which TMR Drilling leased the Triton Rig and related equipment to Orion. In addition, TMR Exploration and Orion are parties to (a) the Drilling Bid Proposal and Daywork Drilling Contract -- U.S., dated as of February 12, 2007, as amended from time to time, relating to the Triton Rig and (b) the Drilling Bid Proposal and Daywork Drilling Contract -- U.S., dated as of August 9, 2007, as amended by letter, dated September 4, 2008, and further amended from time to time, relating to a drilling rig known as the "Taurus Rig", pursuant to which Orion agreed to provide daily drilling, equipment and labor services to TMR Exploration in connection with the operation of certain oil or natural gas wells operated by TMR Exploration. As a result of reductions in its drilling program and other cash constraints, coupled with its inability to continue utilization of the rigs in its current drilling operations, the Companyare also in default under the Equipment Lease and the Drilling Contracts, and as of July 31, 2009 have accrued and unpaid obligations under those agreements of approximately $2.0 million in the aggregate. Concurrently with the execution of the Fortis Forbearance Agreement, the Company, TMR Drilling and TMR Exploration entered into a Forbearance and Amendment Agreement with Orion that provides that Orion will forbear from exercising any and all of its rights or remedies arising as a result of the existing events of default under the Equipment Lease and the Drilling Contracts that are listed in the Orion Forbearance Agreement until the earlier to occur of (a) the date that is fifteen (15) days after the CIT Maturity Date, (b) the commencement of any bankruptcy or insolvency proceedings filed by or against the Company, (c) the expiration or termination of the CIT Forbearance Agreement or the commencement by CIT of the exercise of its remedies as a secured creditor, (d) a default by the Meridian Group under the Orion Forbearance Agreement or the related security agreement, (e) the failure or failures by TMR Drilling to perform or make when due cash payments exceeding, individually or in the aggregate, $50,000 with respect to obligations owing to any one or more of Orion or third parties (respectively) pursuant to the express terms of the Equipment Lease and which failure or failures remain uncured thirty (30) days after receipt of written notice thereof by Orion to TMR Drilling and (f) the date TMR Drilling transfers title to the Triton Rig assets to a person other than Orion or any subsidiary or affiliate of TMR Drilling. Such forbearance does not constitute a waiver by Orion of any such events of default. The Orion Forbearance Agreement also provides that (i) the Company, TMR Drilling and TMR Exploration will grant a security interest in the Triton Rig to Orion as security for the payment of amounts owed by the Meridian Group under the Equipment Lease and the Drilling contracts, (ii) the parties will extend the term of the Equipment Lease to be coterminous with the amortization period of the promissory note executed pursuant to the CIT Credit Agreement, (iii) amounts due by or through the Meridian Group to Orion, on the one hand, and by or through Orion to any of the Meridian Group, on the other hand, under the Equipment Lease and Drilling Contracts shall be offset, with the resulting net amount being accrued to the account of the relevant party but not payable until the maturity date of amounts the Company owes under the CIT Credit Agreement and, at such time, any positive balance of unpaid accrued obligations of either the Meridian Group or Orion may be satisfied by cash payments by the owing party or (in the case of obligations owing by the Meridian Group, at Meridian's option) transfer of title to the Triton Rig to Orion and (iv) upon final settlement of the offsetting payments described in (iii) above, Orion will release the Meridian Group from any and all obligations under, and terminate, the Drilling Contracts and the Equipment Lease. About Meridian Resource The Meridian Resource Corporation, incorporated in 1990, is an independent oil and natural gas company. The Company explores for, acquires and develops oil and natural gas properties. As of December 31, 2008, it had proved reserves of 80 billion cubic feet (Bcfe). Sixty-three percent of its proved reserves were natural gas and approximately 64% were classified as proved developed. It owns interests in 19 fields and 100 producing wells, and operated approximately 96% of its total production during the year ended December 31, 2008. The Company's wholly owned subsidiary, TMR Drilling Corporation (TMRD), owns a rig which is used primarily to drill wells operated by the Company. MERUELO MADDUX-845: Real Estate Collapse Causes Chapter 11 Bankr. ----------------------------------------------------------------- Meruelo Maddux-845 S. Flower Street LLC has filed for Chapter 11 bankruptcy protection. Daniel Miller at Los Angeles Business Journal reports that Meruelo Maddux-845, hurt by the collapse of commercial real estate market, failed to make payments on $266 million in debt. Court documents say that Meruelo Maddux-845's 20 largest unsecured creditors, mostly contractors that have worked on the project, are owed more than $7.5 million. According to Business Journal, Meruelo Maddux-845 first ran into troubles in January 2008, when the Company lost construction financing. Meruelo Maddux-845 secured a high-interest, $84 million replacement loan from Canyon Capital Realty Advisors LLC eight months later. Business Journal relates that Canyon Capital can take possession of Meruelo Maddux-845 if controller Meruelo Maddux Properties cannot reorganize the Company. Meruelo Chinatown LLC, another Meruelo Maddux entity, also filed for bankruptcy on September 3, Business Journal states. Meruelo Maddux-845 S. Flower Street LLC controls a development at 705 W. Ninth Street. It is a 36-story Los Angeles luxury rental building being built by beleaguered commercial real estate developer Meruelo Maddux Properties Inc. Meruelo Maddux-845 S. Flower Street LLC is controlled by Meruelo Maddux Properties, which filed Chapter 11 in March and remains in reorganization. Meruelo Maddux-845 was excluded from Meruelo Maddux's orginal bankruptcy filing. MIDCONTINENT EXPRESS: Moody's Assigns 'Ba1' Corp. Family Rating --------------------------------------------------------------- Moody's Investors Service assigned a first time Ba1 Corporate Family Rating and Ba1 (LGD 3; 49%) rating to Midcontinent Express Pipeline LLC's pending $800 million senior unsecured note offering. Proceeds will repay construction loan borrowings under a $1.4 billion unsecured facility guaranteed severally by MEP sponsors Kinder Morgan Energy Partners (Baa2, negative outlook) and Energy Transfer Partners (Baa3, stable). The loan facility will be reduced to $200 million to $250 million after the offering and remain guaranteed until a February 2011 maturity. The rating outlook is stable. MEP is a 50/50 joint venture between KMP and ETP, formed to build, own, and operate a 507 mile producing-region interstate natural gas pipeline. KMP is operator of the line. MarkWest Energy Partners, L.P. (B1, stable) has exercised an option to acquire, subject to its due diligence, a 10% interest in MEP. If the acquisition closes, ETP and KMP would own 45% of MEP each and MarkWest would own 10%. MEP's ratings are restrained by several factors distinguishing it from most investment grade pipelines. Exploration and production companies comprise 100% of MEP's firm contracted revenue. Reflecting E&P's present visibility and conviction on their regional production potential, some of the contracts begin to reduce after five years and altogether reduce by over 0.4 Bcfd (mostly Zone 1 capacity) after nine years. This contrasts with the long term visibility and conviction of most demand-driven shippers that back most investment grade standalone gas pipelines. Those demand-pull lines are backed by firm contracts from regulated mostly investment grade local distribution companies (LDC), electric utilities, and large transmission pipelines needing constant line access to serve steady-to-growing demand. The producer-push focus of the line may be a long-term rating restraint. While producers committed to sufficient firm capacity to fast track pipeline construction during great up-cycle optimism on gas prices and regional gas shale economics, the current outlooks for long-term prices and producer cash flows are more subdued, sustainable capital spending and regional production growth is likely to be lower than expected, and the growth outlook for two regional shale plays is more modest. In Moody's view, this increases the risk of excess regional line capacity after the pipeline expansion boom and implies that current firm tariffs, captured in boom times, may be lower when MEP remarkets maturing firm capacity between years five and ten of the current contracts. The region clearly contains prominent shale plays. However, all plays mature and eventually decline; MEP's region competes for drilling capital with many other key regions in which MEP's key shippers operate. Furthermore, MEP's composite shipper credit profile is considerably less durable than for investment grade lines. The shipper portfolio is predominately speculative grade E&P's that generate 75% of firm contracted revenue, two investment grade E&P's generate 25% of firm revenue, and one historically aggressive E&P comprises 47% of firm revenue. The E&P sector faces considerable liquidity and cash flow risk over the next three to nine months, with weak gas prices impacting both unhedged production and upcoming E&P borrowing base re-determinations this fall. Much of the E&P sector's protective hedging is also rolling into 2010 prices that may be much lower than current locked-in prices. Moody's understand from public information that MEP averaged approximately 1 Bcfd in August. Finally, MEP has only two of the five regulatory approvals needed to generate its forecasted 2011 cash flow. The pending note offering installs its standalone debt structure before final permitted available capacity is known. MEP remains restricted to run at standard industry operating pressure, yielding 1.247 Bcfd of available billable capacity. Leverage on cash flow would be substantially higher if MEP does not get both Pipeline and Hazardous Materials Safety Administration permission to run at high pressure and FERC permission to expand to 1.8 Bcfd of high pressure capacity. While MEP recently stated that it remains confident it will get all approvals by the end of this October, Moody's review has not been able to rule out that the situation may be more complicated than KMP assumes. After reviewing PHMSA's findings on sector lapses in construction and materiel quality during an unprecedented building boom, its slowdown in awarding high pressure permissions and extensive work within the sector on preventive protocols, and potential for lingering political overtones, for ratings purposes it appears premature to treat PHMSA approval as routine or inevitable. When and if approval is received the ratings would probably not be affected. Nevertheless, the ratings are also supported by several important factors. For at least the medium term, MEP serves an important regional role in moving gas shale production downstream towards long-haul transmission lines. Though the region was laced with existing gas lines serving declining regional conventional gas producing basins and plays, the gas shale plays tended to be located away from easy pipeline access or their production growth exceeded exiting export line capacity. Barring shipper default, firm revenue would be steady for five years and then decline materially over five years, with an average term of nine years. Under the intended 1.8 Bcfd of full high pressure available capacity, revenues would follow the same pattern. MEP is also currently owned and operated by large investment grade midstream operators that have invested substantially in the line. Both sponsors operate key portions of the nation's gas midstream infrastructure, with KMP running one of the largest pipeline and other midstream portfolios in the country. Furthermore, any further cost overruns would be funded with sponsor equity. As long as it remains in the sponsors' interest to do so, they appear able to add value to the line and influence its mix of firm and interruptible capacity usage as current contracts mature. However, part of this influence could include tariff rate competition and/or a greater proportion of interruptible and other non-firm services, depending on market opportunity and conditions at the time. Moody's also always assesses the potential implied sponsor support. In weighing where KMP might have sufficient strategic incentive within its large system to contribute significant remedial liquidity or long-term capital, MEP appears to us to be less of a strategic asset to KMP and the Kinder Morgan, Inc. group than other JV subsidiaries such as REX or the KMI/KMP operated NGPL system. However, Moody's do view MEP to be proportionately more strategic to ETP Neither sponsor has a strategic stake in gas production upstream from MEP or a strategic commitment downstream of MEP in infrastructure or gas supply commitments. While KMP is a very large diversified operator that holds a first class asset portfolio, Moody's also expect financial policy to remain aggressive and system-wide leverage including joint venture leverage to remain quite full for its current ratings. MEP's first full year of revenue will be 2010. MEP believes it will get full regulatory approvals for 2011 to be its first year operating at full high pressure expanded capacity and revenue. If the line operates during 2010 without PHMSA approval, MEP's revenue forecast, which includes a small amount of non-contracted ancillary revenue, would yield Debt/EBITDA of approximately 6.0x and FFO / debt of 9.3% in 2010 (adjusted for Moody's standard debt adjustments). Assuming PHMSA approval, with the increased 2010 cash flow Debt/EBITDA would decrease to approximately 5.1x and FFO / Debt would rise to 12.2%. Assuming FERC approval for the compression expansion and PHMSA approval for high pressure were obtained as planned, if construction completed as planned, and if the expansion was placed in service during December of 2010 as planned, 2011 Debt/EBITDA would approximate 4.4x and FFO / Debt would increase to approximately 15.4%. The sponsors had funded $829 million of equity through August 31, 2009, and report they will have contributed a total of $1.326 billion by October 31, 2009. A final $175 million equity contribution (for a total of $1.5 billion) would be made if FERC approves the expansion to 1.8 Bcfd. All free cash flow will be distributed to the partners on a quarterly basis. Heavy cost overruns render a weak return on assets. Midcontinent Express LLC is headquartered in Houston, Texas. The line originates near Bennington, Oklahoma, cuts across northeast Texas, northern Louisiana, central Mississippi, and terminates at Transco Station 85 near Butler, Alabama. MEP is directly and indirectly connected to growing a natural gas plays in Texas, Oklahoma and Louisiana and indirectly to conventional production already served by other lines. Downstream, MEP is connected to pipelines serving the Southeast, Mid-Atlantic, Northeast, Great Lakes and Chicago markets. MEP has six receipt and ten delivery points along the system. MITCHELL BRIDGE: Case Summary & 2 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Mitchell Bridge Partners LLC 741 Harry McCarty Rd, Suite 201 Bethlehem, GA 30620 Bankruptcy Case No.: 09-23746 Chapter 11 Petition Date: September 8, 2009 Court: United States Bankruptcy Court Northern District of Georgia (Gainesville) Debtor's Counsel: Michael D. Robl, Esq. Thomerson, Spears & Robl, LLC 104 Cambridge Avenue Decatur, GA 30030 Tel: (404) 373-5153 Email: mdrobl@tsrlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $1,230,000, and total debts of $1,079,036. A full-text copy of the Debtor's petition, including a list of its 2 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/ganb09-23746.pdf The petition was signed by John Haley, manager of the Company. MOHAWK INDUSTRIES: S&P Puts 'BB+' Rating on CreditWatch Negative ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it placed its ratings on Calhoun, Georgia-based Mohawk Industries Inc., including its 'BB+' corporate credit rating, on CreditWatch with negative implications. As of June 27, 2009, Mohawk had about $1.9 billion of total debt. "The CreditWatch listing reflects S&P's concerns about the company's difficult operating environment, increased leverage, and S&P's expectation for a further weakening in credit measures over the near term," said Standard & Poor's credit analyst Rick Joy. "Although the company has taken actions to reduce operating expenses and improve cash flow and liquidity, S&P believes Mohawk continues to face challenges from a weak economy and housing market," Mr. Joy added. The company has experienced substantially lower sales volumes in recent quarters, and S&P is concerned that operating performance is unlikely to meaningfully improve in the near term, given S&P's expectation for continued weak demand in the U.S. and European floor coverings markets. The CreditWatch placement means that S&P could lower or affirm the ratings following the completion of S&P's review, which will focus on the company's business strategy and prospects for improving performance and credit measures. Standard & Poor's will meet with management to further discuss Mohawk's operating trends and expectations in order to resolve the CreditWatch listing. MORTGAGEBROKERS.COM: June 30 Balance Sheet Upside Down by $1.2MM ---------------------------------------------------------------- MortgageBrokers.com Holdings Inc.'s balance sheet at June 30, 2009, showed total assets of total assets of $1,653,418 and total liabilities of $2,904,358, resulting in a stockholders' deficit of $1,250,940. For six months ended June 30, 2009, the Company reported a net income of $79,739 compared with a net income of $376,410 for the same period in 2008. For three months ended June 30, 2009, the Company reported a net income of $82,770 compared with a net income of $216,181 for the same period in 2008. The Company said that there is substantial doubt about its ability to continue as a going concern. The Company stated that its ability to continue as a going concern is contingent upon its ability to secure additional debt or equity financing, to continue to grow sales of its services and to achieve profitable operations. The management's plan is to secure additional funds through future debt or equity financings. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. The Company devoted substantially all of its efforts to establishing its current business. The management continues to develop and execute its business model, business plans and strategic marketing plans which includes: organization of the Company and divisions; identification of the Company's sales channels and associated supply chain; development of marketing strategic plans and sales execution strategies; preparation of a financial plan, risk and capital structure planning models, and mortgage origination book of business models; hiring mortgage sales agents to build its national sales force and continuing to develop our referral relationship; developing cash flow forecasts and an operating budget; identifying markets to raise additional equity capital and debt financing; embarking on research and development activities; performing employment searches and preparing agent contracts; and, recruiting and hiring technicians, management and industry specialists. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4486 MortgageBrokers.com Holdings, Inc. (OTC:MBKR), incorporated on Feb. 6, 2003, is a mortgage brokerage operation whose national agency sales force services the borrowing and refinancing needs of individual home buyers and owners. The Company has access to a range of mortgage lenders, in excess of 50 banks, trusts and private lender sources, and its agents source and negotiate the loan with rates, terms and features to meet each customer's needs. The Company acts as broker only and is not a lender. As a mortgage brokerage, it has access to lenders who lend mortgage funds. MOUSSA KARIMI: Case Summary & 13 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: Moussa Karimi dba Hemet East Center dba Walnut Unocal 43510 E Florida Ave Hemet, CA 92544 Bankruptcy Case No.: 09-31184 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Central District of California (Riverside) Judge: Thomas B. Donovan Debtor's Counsel: Donald W. Sieveke, Esq. 1113 N Spurgeon St Santa Ana, CA 92701 Tel: (714) 543-8419 Fax: (714) 558-7459 Email: ibmoola@yahoo.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $1,388,450, and total debts of $5,209,856. A full-text copy of the Debtor's petition, including a list of its 13 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/cacb09-31184.pdf The petition was signed by Moussa Karimi. MOVE WEST LLC: Case Summary & 5 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Move West LLC 7251 West Sahara Avenue Las Vegas, NV 89117 Bankruptcy Case No.: 09-26789 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court District of Nevada (Las Vegas) Judge: Mike K. Nakagawa Debtor's Counsel: David A. Riggi, Esq. 5550 Painted Mirage Road #320 Las Vegas, NV 89149 Tel: (702) 808-0359 Email: darnvbk@gmail.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 A full-text copy of the Debtor's petition, including a list of its 5 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/nvb09-26789.pdf The petition was signed by Tim Deters, manager of the Company. MTI GLOBAL: Has $7.4MM Sub Debt Facility From Wellington -------------------------------------------------------- MTI Global Inc. has entered into a new $7.4 million subordinated debt financing agreement with Wellington Financial LP, which complements the forbearance agreement entered into with its principal Canadian bank. "This represents a significant step forward in our recovery to profitability" said Bill Neill, MTI President and CEO. "Following our earlier agreement with our principal Canadian bank, we have successfully secured support and flexibility from our largest lender to set the corporation back on track." The financing amends the existing Series A Secured Debenture in the principal amount of $7 million. Under the terms of the agreement: -- All existing defaults have been waived and there are no financial ratio covenants in the new arrangement. -- Additional principal in the amount of $418,824 has been added to the principal balance of the Debenture as consideration for default interest. -- The debenture will continue bear interest at an annual rate of 12.75%. -- The Company will issue 2.6 million common shares and cancel 3,230,769 special warrants previously issued to Wellington Financial LP. -- The maturity date is June 3, 2011, or otherwise on demand or immediately prior to a change of control. The issuance of the common shares to Wellington constitutes a shares-for-debt private placement under the rules of the Toronto Stock Exchange. Wellington is an unrelated arm's-length party to the Company and the issuance of the common shares will not materially affect control of the Company. The number of common shares issuable pursuant to the Private Placement will represent in aggregate approximately 9.3% of the 27,808,334 currently issued and outstanding common shares of the Company on a non-diluted basis. Wellington, upon issuance of the common shares, will own approximately 8.5% of the issued and outstanding common shares of the Company. The Private Placement is subject to the approval of the TSX and since the Private Placement will provide for the issuance of additional common shares to Wellington rather than warrants pursuant to the Private Placement, the rules of the TSX require that the Company obtain approval of the Private Placement from the holders of a majority of the voting shares of the Company. However the rules of the TSX also provide that such approval may be obtained in writing from shareholders without the requirement to convene a shareholders' meeting for such purposes, and the Company intends to rely on this exemption in connection with the Private Placement. The closing of the Private Placement is anticipated to occur on or as soon as possible after September 16, 2009. Forbearance Agreement The Company signed a forbearance agreement with its bank on July 10, 2009, with an expiry date of September 30, 2009. Under the terms of the forbearance agreement, additional general covenants have been placed on the Company. However, the agreement did not waive the financial and general covenants and the Company continued to be in breach with its principal Canadian Bank and with its subordinated debt holder, a privately held specialty finance firm. The Company did not achieve its December 31, 2008 earnings before interest, taxes and depreciation, fixed charge coverage and funded debt to earnings before interest, taxes and depreciation covenants or its March 31, 2009, and June 30, 2009 fix charge coverage covenant. Furthermore, the Company is in breach of certain general covenants it was obligated to satisfy pursuant to waiver agreements entered into by the Company with its Bank and Lender based on its June 30, 2008, and subsequent interim monthly results. The covenant violation provides the Bank and the Lender with the right to demand repayment of their indebtedness. Subsequent to June 30, 2009, the Company continued discussions with the Lender seeking to obtain a waiver of the breaches including amended covenants. About MTI Global MTI Global Inc. (CA:MTI) -- http://www.mtiglobalinc.com/-- designs, develops and manufactures custom-engineered products using silicone and other cellular materials. The Company serves a variety of specialty markets focused on two main areas: Silicone and MTI Polyfab, comprising, Aerospace and Fabricated Products. MTI Global's primary markets are aerospace and mass transit. Secondary markets include sporting goods, automotive, industrial, institutional, electronics, and the medical market through a 51% interest in MTI Sterne SARL of Cavaillon, France. MTI Global's head office and Canadian manufacturing operations are located in Mississauga, Ontario, with international manufacturing operations located in Bremen, Germany, Milton, Florida and a contract manufacturer venture in Ensenada, Mexico. The Company also maintains engineering support centres in Brazil and Toulouse, France. MUZAK HOLDINGS: Files Chapter 11 Plan, Has Creditors' Support ------------------------------------------------------------- Muzak Holdings LLC and certain of its subsidiaries has filed a Plan of Reorganization and explanatory Disclosure Statement with the U.S. Bankruptcy Court for the District of Delaware. The Plan is supported by Muzak's largest secured and unsecured creditor, Silver Point Capital Advisors L.P., the official committee of unsecured creditors and an ad hoc committee of the Company's senior unsecured noteholders. As a result, the Plan is supported by an overwhelming majority of the Company's unsecured creditors. A hearing to consider approval of the Disclosure Statement is presently scheduled for October 27, 2009. Under the terms of the Plan, the Company's outstanding debt would be reduced by more than half to $230 million and the Company's annual interest expense would be significantly reduced. "The filing of our Plan represents a significant milestone and an important next step in our effort to restructure Muzak's balance sheet," said Stephen P. Villa, Chief Executive Officer of Muzak. "We look forward to reaching an agreement with all of Muzak's creditors and concluding this process as expeditiously as possible. Although there is still much work to be done, we have worked diligently over the last several months to address our capital structure and we are confident that, upon confirmation of our Plan and emergence from Chapter 11, Muzak will be well- positioned for long-term success." Mr. Villa added, "I want to thank our team members for their commitment to strengthening our business during this process, as well as our loyal clients, affiliates, supportive vendors and other stakeholders, all of whom played a significant role in helping us reach this important milestone." Additional terms of the Plan include: * the holders of secured bank debt claims will either receive payment in full in cash with the proceeds of an exit facility, subject to availability, or their pro rata share of a new term loan; provided that, in the absence of exit financing, and to the extent secured bank debt holders vote to accept the Plan, holders of secured bank debt claims other than Silver Point will receive their pro rata share of $20 million in cash as well as new term loans; * the holders of the $220 million 10% senior unsecured notes will receive new senior unsecured notes at $135 million face amount with 8% cash and 7% PIK coupon, as well as $85 million of payment-in-kind preferred stock; * the holders of the $115 million 9.875% senior subordinated unsecured notes will receive 100% of the new common stock of Reorganized Muzak (subject to dilution for a management incentive plan and the warrants issued to holders of discount note claims); * the holders of the $24 million 13% senior discount unsecured notes will receive warrants for 7.5% of the fully-diluted new common stock at market value based on an enterprise value to be determined with a term of 5 years; and * 100% cash recovery for holders of allowed general unsecured claims. The Disclosure Statement includes a historical profile of the Company, a description of proposed distributions to creditors, and an analysis of the Plan's feasibility, as well as many of the technical matters required for the solicitation process, such as descriptions of who will be eligible to vote on the Plan and the voting process itself. A copy of the Plan is available for free at: http://bankrupt.com/misc/Muzak_Chapter11Plan.pdf Copies of the Disclosure Statement, in three parts, are available for free at: http://bankrupt.com/misc/Muzak_PlanDS_1of3.pdf http://bankrupt.com/misc/Muzak_PlanDS_2of3.pdf http://bankrupt.com/misc/Muzak_PlanDS_3of3.pdf About Muzak Holdings Headquartered in Fort Mill, South Carolina, Muzak Holdings LLC -- http://www.muzak.com/-- creates a variety of music programming from a catalog of over 2.6 million songs and produces targeted custom in-store and on-hold messaging. Through its national service and support network, Muzak designs and installs professional sound systems, digital signage, drive-thru systems, commercial television and more. The Company and 14 affiliates filed for Chapter 11 protection on February 10, 2009 (Bankr. D. Del. Lead Case No. 09-10422). Moelis & Company is serving as financial advisor to the Company. Kirkland & Ellis LLP is the Debtors' counsel. Klehr Harrison Harvey Branzburg & Ellers has been tapped as local counsel. Epiq Bankruptcy Solutions LLC serves as claims and notice agent. Muzak's petition listed assets of $324 million against debt of $465 million, including $101 million owed on a senior secured credit facility, $220 million in senior notes and $115 million in subordinated notes. NAM JIK CHO: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Nam Jik Cho dba Western Metal Engraving 13530 Doty Avenue, Apartment 36 Hawthorne, CA 90250 Bankruptcy Case No.: 09-34035 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Central District of California (Los Angeles) Judge: Alan M. Ahart Debtor's Counsel: Jerome S. Cohen, Esq. 3731 Wilshire Blvd, Ste. 514 Los Angeles, CA 90010 Tel: (213) 388-8188 Fax: (213) 388-6188 Email: jsc@jscbklaw.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/cacb09-34035.pdf The petition was signed by Nam Jik Cho. NCOAT INC: June 30 Balance Sheet Upside-Down by $857 Million ------------------------------------------------------------ nCoat, Inc.'s balance sheet at June 30, 2009, showed total assets of $4,136,644 and total liabilities of $861,788,868, resulting in a stockholders' deficit of $857,652,224 . For the three months ended June 30, 2009, the Company posted a net loss of $30,210,753 compared with a net loss of $38,618,065 for the same period in 2008. For the six months ended June 30, 2009, the Company posted a net loss of $516,453,308 compared with a net loss of $51,558,543 for the same period in 2008. The Company said that there is substantial doubt about its ability to continue as a going concern. The Company noted that at June 30, 2009, it has a working capital deficiency of $860,661,557, an accumulated deficit of $879,965,602 and a stockholders' deficit. Based on current operations, cash flows from operations have become positive and must remain positive for the remainder of the year; however, the Company will likely face negative income for the first three quarters of the year ending Dec. 31, 2009. As of June 30, 2009, the Company's principal sources of liquidity were $74,626 of cash and $457,116 of trade accounts receivable, while current liabilities totaled $861,377,427 at that date, of which $700,623,427 relates to notes payable that are due currently. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?446e nCoat, Inc. (Other OTC: NCOA) -- http://www.ncoat.com/-- and its subsidiaries researches, licenses, commercializes, distributes, and applies nano and multiple non-nano surface coatings. The company's coatings are used by automotive, diesel engine, trucking, recreational vehicle, motorcycle, aerospace, and oil and gas industries for heat management, corrosion resistance, friction reduction, bond strength, abrasion protection, and appearance applications. It also develops and holds proprietary intellectual property, and focuses on executing its distributed production and licensing strategy. The company was founded in 2004 and is headquartered in Whitsett, N.C. Hansen, Barnett & Maxwell, P.C., in Salt Lake City raised substantial doubt about nCoat, Inc.'s ability to continue as a going concern after auditing the company's financial statements for the year ended Dec. 31, 2007. The auditing firm pointed to the Company's losses from operations, negative cash flows from operating activities, and working capital and stockholders' deficit. Auditors were not able to complete the audit for the Company's results for 2008 as nCoat failed to pay the audit fee. NAVISTAR INT'L: Posts $12 Million Net Loss for Fiscal Q3 -------------------------------------------------------- Navistar International Corporation reported its financial results for the fiscal third quarter ended July 31, 2009. Navistar reported a net loss for the current third quarter of $12 million, equal to $0.16 per diluted share, including increased provisions for income taxes, on $2.51 billion in revenues, compared with net income of $331 million, equal to $4.47 per diluted share, on $3.95 billion in revenues in the third quarter a year ago. Included in the results is the impact of the asset acquisition of the recreational vehicle (RV) manufacturing business of Monaco Coach Corporation, which resulted in an extraordinary gain of $23 million, or $0.33 per diluted share, in the third quarter. The gain is a result of the company being able to acquire the RV inventories out of bankruptcy and the effects of purchase accounting with the fair value of the acquired assets. For the nine months ended July 31, 2009, the company said it "demonstrated solid progress in its business strategy" by delivering net income of $234 million, equal to $3.27 per diluted share, on revenues of $8.28 billion, including the impact of the Ford settlement and related charges, compared with net income of $477 million, equal to $6.52 per diluted share, on revenues of $10.85 billion in the same period a year ago. Navistar reported manufacturing cash balances on July 31, 2009, of $751 million compared with $594 million in the prior quarter ended April 30, 2009. Cash flow from operations was positive, as were the net effect of other changes, including working capital, offset by capital investments and the purchase of Monaco. The company continues to project manufacturing cash balances ranging from $700 million to $800 million by year end. At July 31, 2009, the Company had $9.38 billion in total assets and $10.66 billion in total liabilities, resulting in $1.35 billion in stockholders' deficit. Navistar reported $9.65 billion in total assets and $11.09 billion in total liabilities as of April 30, 2009, resulting in $1.44 billion in stockholders' deficit. Navistar said its financial services segment made progress on its strategy to renew Navistar Financial Corporation's maturing facilities by completing the renewal of a $650 million dealer floor plan funding facility. The segment continues to demonstrate quarter-over-quarter improvements as it delivered a segment profit of $20 million in the latest quarter, compared with a segment loss of $1 million in the year-ago period. NFC entered into Amendment No. 4, dated August 25, 2009, to the Series 2000-VFC Supplement to the Pooling and Servicing Agreement, dated January 28, 2000, among Navistar Financial Securities Corporation, as Seller, NFC, as Servicer, and The Bank of New York Mellon, a New York banking corporation, as Master Trust Trustee. NFC also entered into Amendment and Extension to Amended and Restated Certificate Purchase Agreement, dated August 25, 2009, among Navistar Financial Securities Corporation, NFC, Kitty Hawk Funding Corporation, as a Conduit Purchaser, Liberty Street Funding LLC (f/k/a Liberty Street Funding Corp.), as a Conduit Purchaser, The Bank of Nova Scotia, as a Managing Agent and a Committed Purchaser, and Bank of America, National Association, as a Managing Agent, the Administrative Agent and a Committed Purchaser. Navistar reiterated the company will be profitable for its fiscal year ending Oct. 31, 2009, despite reporting a loss for the third quarter. Based on projections for increased income tax expenses and its forecast for the remainder of the year, Navistar lowered its guidance for net income for its fiscal year ending Oct. 31, 2009, to a revised range of $182 million, or $2.55 per diluted share, to $207 million, or $2.85 per diluted share, excluding the Ford settlement and related charges. Including the impact of the Ford settlement, net of related charges, earnings should be in the range of $4.95 to $5.25 per diluted share. "While we are lowering our guidance, we still expect to be strongly profitable at $4.95 to $5.25 per share and I am encouraged by the results of the company and our commitment to generate positive results for our shareholders during these challenging economic times," said Daniel C. Ustian, Navistar chairman, president and chief executive officer. "The third quarter is traditionally our most challenging quarter, but we remain focused on the long-term success of the company. Therefore, we elected not to implement drastic short-term cost cutting actions that would have impacted our ability to deliver long-term results." The company continues to project that total truck industry retail sales volume for Class 6-8 trucks and school buses in the United States and Canada for the fiscal year ending Oct. 31, 2009, will total between 165,000 and 185,000 units. Industry volumes reached a recent high of 454,700 units in 2006 due to accelerated purchases of trucks in anticipation of higher prices due to stricter emissions standards imposed by the Environmental Protection Agency in 2007. However, the industry is anticipating only a minimal pre-buy in 2009 ahead of 2010 emissions requirements. For 2010, the company anticipates that industry volumes will be in the range of 175,000 to 215,000 units. Continuing on its path to meet the latest emissions requirements through its advanced EGR (exhaust gas recirculation) MaxxForce(R) engines, the company said it is on track with its 2010 engine testing and will be prepared for a successful engine launch in the months ahead. A full-text copy of the Company's quarterly report on Form 10-Q is available at no charge at http://ResearchArchives.com/t/s?4492 Navistar presented via live web cast its fiscal 2009 third quarter financial results on September 10. A full-text copy of the slides containing financial and operating information used as part of the web cast is available at no charge at: http://ResearchArchives.com/t/s?4493 About Navistar Navistar International Corporation (NYSE: NAV) -- http://www.Navistar.com/-- is a holding company whose subsidiaries and affiliates subsidiaries produce International(R) brand commercial and military trucks, MaxxForce(R) brand diesel engines, IC Bus(TM) brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse(R) brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The company also provides truck and diesel engine parts and service. Another affiliate offers financing services. * * * Navistar carries Standard & Poor's Ratings Services' 'BB-' corporate credit ratings and Fitch Ratings' 'BB-' Issuer Default Ratings. NAVISTAR INT'L: Posts $12MM 3rd Quarter Loss, Lowers Guidance ------------------------------------------------------------- Confronted by hard economic conditions and the worst truck market since 1962, Navistar International Corporation reiterated that the Company will be profitable for its fiscal year ending Oct. 31, 2009, despite reporting a loss for the third quarter ended July 31, 2009. "While we are lowering our guidance, we still expect to be strongly profitable at $4.95 to $5.25 per share and I am encouraged by the results of the company and our commitment to generate positive results for our shareholders during these challenging economic times," said Daniel C. Ustian, Navistar chairman, president and chief executive officer. "The third quarter is traditionally our most challenging quarter, but we remain focused on the long-term success of the company. Therefore, we elected not to implement drastic short-term cost cutting actions that would have impacted our ability to deliver long-term results." Manufacturing segment profit was $110 million and $604 million, including the impacts of the Ford settlement, net of related charges, for the third quarter and first nine months of 2009, respectively, compared with $473 million and $881 million in the year-ago periods. Due to changes in production schedules between foreign entities, improved results in foreign operations, and other special items, the company has revised its full-year tax estimates, resulting in a $30 million charge in the third quarter. Navistar reported a net loss for the current third quarter of $12 million, equal to $0.16 per diluted share, including increased provisions for income taxes, on $2.51 billion in revenues, compared with net income of $331 million, equal to $4.47 per diluted share, on $3.95 billion in revenues in the third quarter a year ago. Included in the results is the impact of the asset acquisition of the recreational vehicle (RV) manufacturing business of Monaco Coach Corporation, which resulted in an extraordinary gain of $23 million, or $0.33 per diluted share, in the third quarter. The gain is a result of the company being able to acquire the RV inventories out of bankruptcy and the effects of purchase accounting with the fair value of the acquired assets. For the nine months ended July 31, 2009, the company demonstrated solid progress in its business strategy by delivering net income of $234 million, equal to $3.27 per diluted share, on revenues of $8.28 billion, including the impact of the Ford settlement and related charges, compared with net income of $477 million, equal to $6.52 per diluted share, on revenues of $10.85 billion in the same period a year ago. Navistar reported manufacturing cash balances on July 31, 2009, of $751 million compared with $594 million in the prior quarter ended April 30, 2009. Cash flow from operations was positive, as were the net effect of other changes, including working capital, offset by capital investments and the purchase of Monaco. The Company continues to project manufacturing cash balances ranging from $700 million to $800 million by year end. Based on projections for increased income tax expenses and its forecast for the remainder of the year, Navistar lowered its guidance for net income for its fiscal year ending Oct. 31, 2009, to a revised range of $182 million, or $2.55 per diluted share, to $207 million, or $2.85 per diluted share, excluding the Ford settlement and related charges. Including the impact of the Ford settlement, net of related charges, earnings should be in the range of $4.95 to $5.25 per diluted share. The Company continues to project that total truck industry retail sales volume for Class 6-8 trucks and school buses in the United States and Canada for the fiscal year ending Oct. 31, 2009, will total between 165,000 and 185,000 units. Industry volumes reached a recent high of 454,700 units in 2006 due to accelerated purchases of trucks (pre-buy) in anticipation of higher prices due to stricter emissions standards imposed by the Environmental Protection Agency in 2007. However, the industry is anticipating only a minimal pre-buy in 2009 ahead of 2010 emissions requirements. For 2010, the Company anticipates that industry volumes will be in the range of 175,000 to 215,000 units. Continuing on its path to meet the latest emissions requirements through its advanced EGR (exhaust gas recirculation) MaxxForce(R) engines, the company said it is on track with its 2010 engine testing and will be prepared for a successful engine launch in the months ahead. Navistar continues to invest in product leadership and remains focused on key growth initiatives that drive business value. The third quarter of 2009 saw the advancement of the company's 2010 emissions approach with the certification by the California Air Resources Board (CARB) and its plan to develop and manufacture an all-electric vehicle through its strategy of leveraging what the company has and what others have built. This period also saw the launch of several new products, such as the International(R) Husky Tactical Support Vehicle for the U.K. Ministry of Defense, and the progression of several initiatives that the company believes will be key contributors to its future success. Navistar International Corporation (NYSE: NAV) -- http://www.Navistar.com/-- is a holding company whose subsidiaries and affiliates subsidiaries produce International(R) brand commercial and military trucks, MaxxForce(R) brand diesel engines, IC Bus(TM) brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse(R) brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The company also provides truck and diesel engine parts and service. Another affiliate offers financing services. Navistar reported $9.65 billion in total assets and $11.09 billion in total liabilities as of April 30, 2009, resulting in $1.44 billion in stockholders' deficit. * * * Navistar carries Standard & Poor's Ratings Services' 'BB-' corporate credit ratings and Fitch Ratings' 'BB-' Issuer Default Ratings. NEPHROS INC: Posts $1 Million Net Loss in Six Months Ended June 30 ------------------------------------------------------------------ Nephros Inc. posted a net loss of $413,000 for three months ended June 30, 2009, compared with a net loss of $2,444,000 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss of $1,148,000 compared with a net loss of $4,084,000 for the same period in 2008. At June 30, 2009, the Company's balance sheet showed total assets of $2,340,000, total liabilities of $928,000 and stockholders' equity of $1,412,000. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4488 Headquartered in New York, Nephros Inc. (Amex: NEP) -- http://www.nephros.com/-- is a medical device company developing and marketing products designed to improve the quality of life for the End-Stage Renal Disease patient, while addressing the critical financial and clinical needs of the care provider. Nephros also markets a line of water filtration products, the Dual Stage Ultrafilter. With an initial focus on health care, the DSU is in a pilot-use program at a major U.S. medical center and has been selected for further development by the U.S. Marine Corps. Going Concern Doubt On March 27, 2009, Rothstein, Kass & Company, P.C., in Roseland, New Jersey expressed substantial doubt about Nephros Inc.'s ability to continue as a going concern after auditing the Company's financial statements for the fiscal years ended Dec. 31, 2008, and 2007. The auditor noted that the Company incurred negative cash flow from operations and net losses since inception. NETWORK COMMUNICATIONS: S&P Junks Corporate Credit Rating --------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit and bank loan issue-level ratings on Lawrenceville, Georgia-based Network Communications Inc. by one notch to 'CCC+' from 'B-', and the rating outlook is negative. At the same time, S&P lowered the issue-level rating on NCI's $15 million revolving credit facility due 2010 and $76.7 million term loan B due 2012 to 'CCC+' (the same as the 'CCC+' corporate credit rating on the company) from 'B+'. S&P also revised the recovery rating on this debt to '3' from '1'. The '3' recovery rating indicates S&P's expectation of meaningful (50% to 70%) recovery in the event of a payment default. S&P also lowered the issue-level rating on NCI's $175 million 10.75% senior notes due 2013 to 'CCC-' (two notches lower than the 'CCC+' corporate credit rating) from 'CCC+'. S&P also revised the recovery rating on this debt to '6' from '5'. The '6' recovery rating indicates S&P's expectation of negligible (0% to 10%) recovery in the event of a payment default. "The recovery rating revision reflects a change to S&P's estimated default EBITDA and emergence valuation under S&P's simulated default scenario," said Standard & Poor's credit analyst Jeanne Mathewson. Under S&P's revised default scenario, S&P assumes EBITDA at emergence will have declined significantly from S&P's 2010 fiscal year estimate, and that the assumed distressed EBITDA multiple would be in the 3x to 4x range. The change to S&P's default EBITDA assumption resulted in a lower gross emergence enterprise value than in S&P's previous analysis. The ratings downgrade reflects S&P's expectation that NCI's liquidity will become further strained, as S&P believes that declines in the company's remodeling, home improvement, and home sales segments will likely continue. Over the intermediate term, S&P expects the company's discretionary cash flow to be minimal and access to its revolving credit facility could be curtailed by covenant constraints. Lease-adjusted debt (including $42 million of holding company 12% pay-in-kind (PIK) notes) to EBITDA increased to 9.9x for the 12 months ended June 21, 2009, from 6.2x a year earlier. EBITDA coverage of total interest expense was very low at 1.0x, while EBITDA coverage of cash interest was slightly better at 1.2x, benefiting from the absence of cash interest payments on the PIK senior subordinated notes for the life of the notes. Discretionary cash flow for the 12 months ended June 21, 2009, fell into negative territory because of a negative swing in working capital. S&P expects discretionary cash flow to be minimal over the intermediate term. NEW FRONTIER BANK: Penny Worley Auctions Tow Trucks & Vehicles -------------------------------------------------------------- Penny Worley Auctioneers will conduct an online auction of tow trucks and vehicles from New Frontier Bank. "These tow trucks, pickup trucks and vehicles from New Frontier Bank will sell to the highest bidder," explained Penny Worley's Jerry Jenkins. "This is a great opportunity for small business owners to buy trucks at a great value, especially in a bad economy." Vehicles in this online bank auction comprise over 30 lots, including 13 tow trucks, plus several cars, SUV's, pickup trucks and a minivan. Jenkins said the vehicles are repossessed assets from New Frontier Bank and were ordered sold by the Federal Deposit Insurance Corporation (FDIC) as receivership of the bank. In 2008, Penny Worley Auctioneers was named an official auctioneer for the FDIC. The online auction is open to the public. Bidding ends September 27. Vehicles may be previewed in person on Saturday, September 26, from 11:00 a.m. to 5:00 p.m. Bidders must register prior to bidding. For more information, visit http://www.WorleyAuctioneers.com/, or call Jerry Jenkins at (513) 313-9178. Penny Worley Auctioneers conducts auctions throughout the United States, including over 100 auctions in 2008. The company is a member of the National Auctioneers Association, the Ohio Auctioneers Association and the Certified Appraisers Guild of America, National Association of Realtors & Ohio Association of Realtors and Members of the Cincinnati and Dayton Home Builders Association. About New Frontier New Frontier Bank was a bank based in Greeley Colorado. As of March 24, 2009, New Frontier had total assets of $2.0 billion and total deposits of about $1.5 billion. New Frontier Bank was closed April 10, 2009, by the State Bank Commissioner, by Order of the Banking Board of the Colorado Division of Banking, which then appointed the Federal Deposit Insurance Corporation as receiver. A Deposit Insurance National Bank of Greeley was created by the FDIC and opened for 30 days to allow depositors at New Frontier time to open accounts at other insured institutions. At the time of closing, there were approximately $150 million in insured deposits and $4 million in deposits that potentially exceeded the insurance limits. Uninsured deposits were not transferred to the DINB. NEWPAGE CORP: NP Investor Extends Debt Tender Offer Until Today --------------------------------------------------------------- NP Investor LLC, an affiliate of Cerberus Capital Management, L.P., the indirect controlling shareholder of NewPage Corporation, has extended the Withdrawal Deadline, Early Participation Time and Expiration Time for its previously announced cash tender offer to purchase certain of NewPage's outstanding Floating Rate Senior Secured Notes due 2012 and 10% Senior Secured Notes due 2012. The Second Lien Notes Offer is described in detail in the Offer to Purchase dated July 15, 2009, and the related Letter of Transmittal, as amended by the Supplement to the Second Lien Notes Offer dated August 10, 2009, and the previously distributed press releases dated August 10, 2009, and August 21, 2009. The Second Lien Notes Offer has been extended as follows: * NPI extended the Withdrawal Deadline, previously scheduled for 12:00 Midnight, New York City time, on Friday, September 4, 2009, to 12:00 Midnight, New York City time, on Friday, September 11, 2009, unless further extended; * NPI extended the Early Participation Time, previously scheduled for 12:00 Midnight, New York City time, on Friday, September 4, 2009, to 12:00 Midnight, New York City time, on Friday, September 11, 2009, unless further extended. All holders tendering their Second Lien Notes on or prior to the new Early Participation Time and whose Second Lien Notes are accepted for purchase will be eligible to receive the Early Participation Premium; and * NPI extended the Expiration Time, previously scheduled for 12:00 Midnight, New York City time, on Friday, September 4, 2009, to 12:00 Midnight, New York City time, on Friday, September 11, 2009, unless further extended. NPI also has terminated its previously announced cash tender offer to purchase certain of NewPage Holding Corporation's outstanding Floating Rate Senior Unsecured PIK Notes due 2013 and NewPage's outstanding 12% Senior Subordinated Notes due 2013. As a result of the termination of the Subordinated Notes Offer, no Subordinated Notes will be accepted for purchase in the Subordinated Notes Offer and NPI will not pay the tender offer consideration or the early participation premium with respect to any Subordinated Notes. Any Subordinated Notes that have been tendered will be promptly returned to the tendering holders. NewPage and NPI have retained Citi to serve as the lead dealer manager for the Second Lien Notes Offer and Banc of America Securities LLC, Credit Suisse Securities (USA) LLC and Goldman, Sachs & Co. are acting as additional dealer managers. Barclays Capital Inc. is acting as co-manager for the Second Lien Notes Offer. Questions regarding the Second Lien Notes Offer may be directed to Citigroup Global Markets Inc. at (212) 723-6106 (collect) or (800) 558-3745 (toll-free). Requests for documents in connection with the Second Lien Notes Offer may be directed to Global Bondholder Services Corporation, the information agent for the Second Lien Notes Offer at (212) 430-3774 or (866) 470-3700 (toll-free). As reported by the Troubled Company Reporter on August 24, 2009, NewPage said it is continuing discussions with lenders to obtain a waiver or amendment to its covenants. NewPage said it is in compliance with all covenants as of June 30, 2009. The required financial covenant levels and the actual levels as of June 30, 2009 are: Covenant Actual -------- ------ Maximum Leverage Ratio 5.75 5.65 Maximum Senior Leverage Ratio 3.25 3.04 Minimum Interest Coverage Ratio 1.75 2.14 Minimum Fixed Charge Coverage Ratio 1.10 1.36 NewPage noted the required financial covenant levels become more restrictive over the term of the senior secured credit facilities. By December 31, 2009, the leverage ratio declines to 5.00 with further decreases over the following three years to 3.75, the senior leverage ratio declines to 2.50 with further decreases over the following three years to 1.25 and the interest coverage ratio increases to 2.00 with a further increase to 2.50 the following year. In July 2009, NewPage said it was working with lenders on an amendment of certain provisions of its term loan senior secured credit facility and revolving senior secured credit facility. In addition, NP Investor LLC, an affiliate of Cerberus Capital Management, L.P., the indirect controlling shareholder of NewPage, announced in July 2009 an offer to purchase a portion of NewPage's floating rate senior secured notes, 10% senior secured notes and 12% senior subordinated notes. In addition, NPI announced an offer to purchase all of NewPage Holding's senior unsecured PIK notes that are validly tendered and not withdrawn. Furthermore, the size, terms and timing of NewPage's proposed offering of new senior secured notes due 2014 are still under consideration at this time. There can be no assurance that NewPage or NPI will complete any or all of the transactions on the terms previously announced or at all. "The economic environment continues to be challenging and uncertain, with limited visibility to the timing and strength of an economic recovery in North American coated paper. We continue to closely monitor market pricing and demand, but forecasting has become particularly difficult in this uncertain environment. A weak recovery in customer demand, coupled with continued price erosion, could jeopardize our ability to meet our financial covenants during the upcoming twelve-month period," NewPage said. NewPage also said its senior secured credit agreements allow the shareholders of NewPage Group to make an equity contribution to NewPage within 10 days of the delivery of the compliance certificate to the administrative agent. The equity contribution would be added to consolidated adjusted EBITDA to determine compliance. The aggregate amount of contributions cannot exceed $50 million and may be made up to two times in any 12 month period and four times over the life of the credit agreements. "We cannot provide assurance that waivers or amendments could be obtained or whether the shareholders of NewPage Group would make an equity contribution to cure a violation. If we did violate our financial covenants, and were not able to obtain a waiver or amendment to the covenants, and the shareholders of NewPage Group did not make an equity contribution to cure the violation, and the lenders so request, the debt would become immediately payable and would affect our ability to borrow amounts under the revolving credit facility for liquidity needs. We do not have sufficient cash on hand to satisfy such a demand. Accordingly, the inability to comply with our financial covenants or obtain waivers or amendments for non-compliance would have a material adverse effect on our financial position, results of operations, liquidity and cash flows," NewPage said. As of June 30, 2009, NewPage Holding had $4.141 billion in total assets; and total current liabilities of $475 million, long-term debt of $3.145 billion, and other long-term obligations of $618 million; resulting in $97 million total deficit. As of June 30, 2009, NewPage Corp. had $4.140 billion in total assets; and total current liabilities of $475 million, long-term debt of $2.953 billion, and other long-term obligations of $618 million; resulting in $94 million total deficit. About NewPage Corporation Headquartered in Miamisburg, Ohio, NewPage is the largest coated paper manufacturer in North America, based on production capacity, with $4.4 billion in net sales for the year ended December 31, 2008. The company's product portfolio is the broadest in North America and includes coated freesheet, coated groundwood, supercalendered, newsprint and specialty papers. These papers are used for corporate collateral, commercial printing, magazines, catalogs, books, coupons, inserts, newspapers, packaging applications and direct mail advertising. NewPage owns paper mills in Kentucky, Maine, Maryland, Michigan, Minnesota, Wisconsin and Nova Scotia, Canada. These mills have a total annual production capacity of approximately 4.4 million tons of paper, including approximately 3.2 million tons of coated paper, approximately 1.0 million tons of uncoated paper and approximately 200,000 tons of specialty paper. NEWPAGE CORP: S&P Raises Rating on Subordinated Notes to 'CC' ------------------------------------------------------------- Standard & Poor's Ratings Services raised its issue-level rating on NewPage Corp.'s (CC/Negative/--) 12% subordinated notes due 2013 to 'CC' from 'C'. The recovery rating on the notes remains a '6', indicating S&P's expectations for negligible recovery in the event of a payment default. S&P also lowered the issue-level rating on NewPage's secured term loan to 'CCC' from 'B+' and removed it from CreditWatch with negative implications. S&P revised the recovery rating on the term loan to '3', indicating S&P's expectation of meaningful (50% to 70%) recovery in the event of a payment default, from '1'. "We raised the rating on NewPage's subordinated notes following the disclosure by the company that NP Investor LLC [NPI], an affiliate of NewPage's controlling shareholder [Cerberus Capital Management L.P.], has terminated its previously announced cash tender offer for the subordinated notes," said Standard & Poor's credit analyst Andy Sookram. As a result of this termination, the notes are no longer subject to S&P's distressed exchange criteria. The revised rating on the notes is two notches below the 'CCC' corporate credit rating that S&P anticipates assigning upon completion of the second-lien notes tender offer. S&P revised the recovery rating on the term loan B to '3', indicating its expectation for meaningful (50% to 70%) recovery in the event of a payment default, from '1', given continued challenging end-market demand for coated papers and S&P's expectation for lower earnings and cash flow prospects in the default horizon. NPI has extended the expiration time for its previously announced cash tender offer for NewPage's floating rate and 10% second-lien notes due 2012, previously scheduled for Sept. 4, 2009, to Sept. 11, 2009, unless further extended. S&P continue to view this transaction as a distressed exchange and tantamount to a default, as S&P views NPI in the same light as NewPage itself acquiring the notes, given the shareholder's substantial ownership of NewPage and the company's highly leveraged financial risk profile. In addition, NPI terminated its previously announced cash tender offer for NewPage's holding company pay-in-kind notes, which S&P does not rate. NewPage is also seeking to amend its bank credit facilities, which consist of a $500 million asset-based lending facility due 2012 and a $1.5 billion term loan B maturing in 2014, to provide covenant relief. The proposed amendments include the elimination of certain financial covenants through March 31, 2010, including minimum interest coverage and maximum leverage tests, and allow the company to repurchase term loan and second-lien debt in the future, subject to certain exceptions. The company also cancelled its proposed offering of $595 million senior secured notes. Upon completion of the contemplated exchange, S&P will lower the corporate credit rating to 'SD' (selective default) and the issue- level rating on the second-lien notes to 'D'. S&P also expects to revise the recovery rating on the second-lien notes to '6' from '5', indicating S&P's expectation of negligible (0% to 10%) recovery for noteholders. As soon as possible thereafter, S&P expect, based on its preliminary analysis, that S&P will raise the corporate credit rating to 'CCC'. S&P believes that, while the financial covenant relief should ease liquidity pressures in the next few quarters, the company will continue to face substantial financial challenges because of its very heavy debt burden and its expectation that weak market conditions will continue through 2010, resulting in weak cash flow levels. The outlook is negative, reflecting S&P's expectation that S&P will lower the corporate credit rating on NewPage to 'SD' following the completion of the tender offer. NORTEL NETWORKS: Enterprise Auction Today, Verizon Notes of Pacts ----------------------------------------------------------------- Nortel Networks will conduct an auction for its Enterprise business today. Networks has confirmed that it received additional bids for its Enterprise Solutions unit in addition to Avaya Inc.'s $475 million offer, but did not provide any other details. According to Michael Bathon at Bloomberg, Verizon Communications Inc. said it intends to object if Avaya wins the auction, saying it would harm U.S. national security. Verizon lawyers said in court papers that Avaya has decided it will terminate support and service contracts that Verizon has with Nortel if it wins the auction. Verizon's customers include government agencies and offices in the U.S. Verizon relies on Toronto-based Nortel to provide maintenance, repairs, spare parts and support service to these customers. If Avaya pursues tits decision to exclude the Verizon contracts from the sale, federal departments and agencies would be at risk of disruption, Verizon said. In response to Verizon's motion, Avaya Inc. issued the following statement, saying "Avaya is committed to providing current and future customers of Avaya with the highest levels of service and support as we pursue the acquisition of Nortel Enterprise Solutions. Avaya is engaged in discussions with Verizon to attempt to negotiate suitable arrangements for the assumption of the contracts referenced in Verizon's motion filed September 9, 2009. Avaya continues to believe that the acquisition of Nortel's Enterprise Solutions unit by Avaya will deliver significant value for customers and other stakeholders of both companies." Avaya -- http://www.avaya.com/-- is a global leader in enterprise communications systems. Ericsson Offered 680 Jobs Ericsson AB, which is buying Nortel Networks Corp.'s wireless business, offered jobs to 680 Nortel employees, Bloomberg News said, citing a report by the Canadian Broadcasting Corporation. CBC, which cited Ericsson officials as saying, stated the move doesn't create any new jobs and the employees will remain in Ottawa where Nortel has facilities. The workers have until the end of the day to accept, CBC said. Nortel has already obtained approval from the courts in Canada and the United States to sell its CDMA business and LTE Access assets to Telefonaktiebolaget LM Ericsson for a purchase price of US$1.13 billion. The sale to Ericsson has not yet been closed. Completion of the sale is subject to regulatory and other customary closing conditions. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation (NYSE/TSX: NT) -- http://www.nortel.com/-- delivers next- generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. Nortel Networks Limited is the principal direct operating subsidiary of Nortel Networks Corporation. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young has been appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor also sought recognition of the CCAA Proceedings in the Bankruptcy Court under Chapter 15 of the Bankruptcy Code. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Chapter 15 case is Bankr. D. Del. Case No. 09-10164. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. Certain of Nortel's European subsidiaries have also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NORTEL NETWORKS: Cleary Gottlieb Charges $17.3MM for May-July ------------------------------------------------------------- Six professionals retained in Nortel Networks' Chapter 11 cases filed applications, seeking interim allowance of fees for services provided in the Debtors' cases and reimbursement of reasonable expenses incurred: Professional Fee Period Fees Expenses ------------ ---------- ---------- -------- Cleary Gottlieb Steen 05/01/09 to $4,189,301 $149,375 & Hamilton LLP 05/31/09 Cleary Gottlieb Steen 06/01/09 to $6,719,870 $260,256 & Hamilton LLP 06/30/09 Cleary Gottlieb Steen 07/01/09 to $6,401,447 $105,860 & Hamilton LLP 07/31/09 Jackson Lewis LLP 06/01/09 to $28,054 $1,276 06/30/09 Jackson Lewis LLP 07/01/09 to $11,173 $12 07/31/09 Huron Consulting Group 07/01/09 to $124,599 $16,025 07/31/09 Crowell & Moring LLP 05/01/09 to $7,900 $63 05/31/09 Crowell & Moring LLP 06/01/09 to $18,557 $6 06/30/09 Crowell & Moring LLP 07/01/09 to $11,208 $33 07/31/09 Morris Nichols Arsht 07/01/09 to $117,769 $53,27l & Tunnell LLP 07/31/09 Lazard Freres & Co. 05/01/09 to $250,000 $60,669 LLC 05/31/09 Palisades Capital 07/01/09 to $130,000 $0 Advisors LLC 07/31/09 Palisades Capital 08/01/09 to $130,000 $0 Advisors LLC 08/31/09 The aggregate amount of fees and expenses sought by each of these professionals employed by the Debtors for the period May 1 through July 31, 2009, are: Professional Fees Expenses ------------ ---------- --------- Cleary Gottlieb $17,310,618 $515,493 Huron Consulting $592,854 $75,612 True Partners Consulting LLC $340,573 $0 Palisades Capital Advisors LLC $360,645 $2,489 Morris Nichols $275,510 $121,241 Jackson Lewis LLP $62,996 $1,356 Shearman & Sterling $63,916 $2,356 Ernst & Young LLP $39,739 $0 Six other professionals retained by the Official Committee of Unsecured Creditors also filed monthly fee applications. They are: Professional Fee Period Fees Expenses ------------ ---------- ---------- -------- Akin Gump Strauss 07/01/09 to $1,042,206 $24,587 Hauer & Feld LLP 07/31/09 Capstone Advisory 06/01/09 to $454,508 $20,526 Group LLC 06/30/09 Capstone Advisory 07/01/09 to $447,305 $30,532 Group LLC 07/31/09 Ashurst LLP 07/01/09 to GBP16,941 GBP73 07/31/09 Jefferies & Company 05/01/09 to $200,000 $26,719 Inc. 05/31/09 Jefferies & Company 06/01/09 to $200,000 $30,053 Inc. 06/30/09 Richards Layton & 07/01/09 to $6,239 $1,883 Finger P.A. 07/31/09 Fraser Milner Casgrain 07/01/09 to C438,179 C4,857 LLP 07/31/09 About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation (NYSE/TSX: NT) -- http://www.nortel.com/-- delivers next- generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. Nortel Networks Limited is the principal direct operating subsidiary of Nortel Networks Corporation. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young has been appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor also sought recognition of the CCAA Proceedings in the Bankruptcy Court under Chapter 15 of the Bankruptcy Code. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Chapter 15 case is Bankr. D. Del. Case No. 09-10164. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. Certain of Nortel's European subsidiaries have also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NORTEL NETWORKS: Gets Court Nod to Enforce PBGC Retirement Pact --------------------------------------------------------------- Nortel Networks Inc. and its affiliated debtors sought and obtained the Court's permission to take all actions to effectuate an agreement between Pension Benefit Guaranty Corporation and the committee overseeing an NNI-sponsored retirement income plan. The Retirement Plan is a tax-qualified, single-employer, defined benefit pension plan, which is covered by the Employee Retirement Income Security Act. As of January 1, 2009, there are approximately 22,220 present and former employees of Nortel and and their beneficiaries who are entitled to receive pension benefits under the retirement plan. PBGC and the Retirement Plan Committee reached an agreement for the termination of the NNI-sponsored retirement plan as well as the appointment of the agency as the plan's trustee. Prior to the parties' agreement, PBGC filed a complaint in mid July 2009, in the Middle District of Tennessee, seeking the involuntary termination of the Retirement Plan effective July 17, 2009, and its appointment as trustee of the Retirement Plan. PBGC complained of the Retirement Plan's inability to pay the plan benefits and the possible loss PBGC may suffer in the long run if the Retirement Plan is not terminated. In a previously reported public statement, PBGC intend to take over the Retirement Plan assets and use insurance funds to pay guaranteed benefits under the Plan to retirees and beneficiaries. "The Debtors are not signatories to the agreement and have no clear obligations under the agreement, however, given that NNI is the pension plan's sponsor and was a named defendant in the termination proceeding, in an abundance of caution, NNI requests authorization to take all necessary or appropriate actions to effectuate the agreement and plan termination," says Chad Fights, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, Delaware. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation (NYSE/TSX: NT) -- http://www.nortel.com/-- delivers next- generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. Nortel Networks Limited is the principal direct operating subsidiary of Nortel Networks Corporation. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young has been appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor also sought recognition of the CCAA Proceedings in the Bankruptcy Court under Chapter 15 of the Bankruptcy Code. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Chapter 15 case is Bankr. D. Del. Case No. 09-10164. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. Certain of Nortel's European subsidiaries have also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NORTEL NETWORKS: Proposes Deal With Computer Science ---------------------------------------------------- Nortel Networks Inc. and its affiliated debtors seek the Court's authority to enter into an agreement with Computer Science Corporation to reconcile various prepetition accounts receivable owed by and to NNI and CSC. Under the parties' agreement, CSC agreed to setoff a sum of $3,549,446, which it owes to NNI against the $5,118,105, which CSC owes NNI. The claims stemmed from an Amended Master Information Technology Service Agreement, a Master Services Agreement, and a Master Reseller Agreement and related contractual documents CSC and NNI were parties to before the Petition Date. The Court will convene a hearing on September 15, 2009, to consider the Debtors' request. Creditors and other concerned parties have until September 8, 2009, to file their objections. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation (NYSE/TSX: NT) -- http://www.nortel.com/-- delivers next- generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel's technologies are designed to help eliminate today's barriers to efficiency, speed and performance by simplifying networks and connecting people to the information they need, when they need it. Nortel does business in more than 150 countries around the world. Nortel Networks Limited is the principal direct operating subsidiary of Nortel Networks Corporation. Nortel Networks Corp., Nortel Networks Inc., and other affiliated corporations in Canada sought insolvency protection under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List). Ernst & Young has been appointed to serve as monitor and foreign representative of the Canadian Nortel Group. The Monitor also sought recognition of the CCAA Proceedings in the Bankruptcy Court under Chapter 15 of the Bankruptcy Code. Nortel Networks Inc. and 14 affiliates filed separate Chapter 11 petitions on January 14, 2009 (Bankr. D. Del. Case No. 09-10138). Judge Kevin Gross presides over the case. James L. Bromley, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serves as general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The Chapter 15 case is Bankr. D. Del. Case No. 09-10164. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. Certain of Nortel's European subsidiaries have also made consequential filings for creditor protection. The Nortel Companies related in a press release that Nortel Networks UK Limited and certain subsidiaries of the Nortel group incorporated in the EMEA region have each obtained an administration order from the English High Court of Justice under the Insolvency Act 1986. The applications were made by the EMEA Subsidiaries under the provisions of the European Union's Council Regulation (EC) No. 1346/2000 on Insolvency Proceedings and on the basis that each EMEA Subsidiary's centre of main interests is in England. Under the terms of the orders, representatives of Ernst & Young LLP have been appointed as administrators of each of the EMEA Companies and will continue to manage the EMEA Companies and operate their businesses under the jurisdiction of the English Court and in accordance with the applicable provisions of the Insolvency Act. Several entities, particularly, Nortel Government Solutions Incorporated have material operations and are not part of the bankruptcy proceedings. As of September 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of September 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Bankruptcy Creditors' Service, Inc., publishes Nortel Networks Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Nortel Networks Corp. and its various affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) NUKOTE INTERNATIONAL: Sues Office Depot for $217 Million -------------------------------------------------------- Nukote International Inc. has sued Office Depot Inc. before the Bankruptcy Court, which handles Nukote's bankruptcy case, for $217 million, claiming that Office Depot's "egregious fraudulent misrepresentations" caused the Chapter 11 filing, Bloomberg's Bill Rochelle reported and The Associated Press reported. Nukote, according to the reports, contends in the suit that Office Depot was secretly planning to shift the private brand imaging supplies business to another supplier. Office Depot denied it breached any agreement and said "it is Nukote that is indebted to Office Depot," not the other way around. Brian Levine, a spokesman for Office Depot, said in a statement that Nukote stopped shipping in early April, "despite the fact that Office Depot continued to place orders." About Nukote International Headquartered in Franklin, Tennessee, Nukote International, Inc. - - http://www.nukote.com/-- makes ink and toner cartridges for laser and ink-jet printers, copiers, and fax machines. The Company and its affiliates filed for Chapter 11 on June 3, 2009 (Bankr. M. D. Tenn. Lead Case No. 09-06240). Barbara Dale Holmes, Esq., at Harwell Howard Hyne Gabbert & Manner, P., and Frank J. Wright, Esq., at Wright Ginsberg Brusilow PC represent the Debtors in their restructuring efforts. The Debtors have assets and debts both ranging from $10 million to $50 million. Nukote's secured lender CIT Group/Business Credit, Inc. is owed $30 million under a prepetition financing agreement. The $30 million is consists of a $6.3 million term loan and a $23 million revolving line of credit. About Office Depot Office Depot, Inc. is a global supplier of office products and services. The Company is organized into three business segments: North American Retail division, North American Business Solutions division and International division. Its sales are processed through multiple channels, consisting of office supply stores, a contract sales force, an outbound telephone account management sales force, Internet sites, direct marketing catalogs and call centers, supported by its network of crossdocks, warehouses and delivery operations. In April 2008, Office Depot, Inc. and Reliance Retail Limited, a subsidiary of Reliance Industries Limited, announced that they have entered into a joint venture to provide office products and services to business customers in India. Office Depot, Inc. and Reliance also announced the acquisition of eOfficePlanet, one of the dealers of office products and services to corporate customers in India. Standard & Poor's Ratings Services said in June 2009 that its ratings and outlook on Boca Raton, Florida-based Office Depot Inc. (B/Negative/--) are not immediately affected by the company's announcement that it sold $350 million of perpetual convertible preferred stock to BC Partners Inc. NV BROADCASTING: Gets Plan Confirmation After 60 Days ----------------------------------------------------- New Vision Television said September 10 its Plan of Reorganization has been approved by the U.S. Bankruptcy Court for the District of Delaware. The Court's decision signals an imminent end to New Vision's restructuring process. New Vision began its restructuring process on July 13, 2009, with the support of the company's first and second lien debt holders, and New Vision's debt holders today unanimously supported the company's Plan of Reorganization. New Vision owns or provides services to 14 major network-affiliated television stations across the United States. Under the Plan, as approved by the Court, all of New Vision's debt and guaranteed obligations of more than $400 million will be eliminated. New Vision will be provided with sufficient capital to ensure the company's uninterrupted business operations, and New Vision's existing management and employees will remain in place. "New Vision has reached an important milestone," said Jason Elkin, New Vision's founder and Chief Executive Officer. "As we began this restructuring process, we promised our employees, our viewers and our advertisers that New Vision wouldn't miss a beat, and we haven't. Our daily business hasn't been impacted at all: Jobs and benefits for our employees are intact; advertisers have continued to receive top customer service; and our stations have continued to invest in best-of-class news coverage and other programming. Now, with the Court's approval of our reorganization plan, the way is clear for New Vision to emerge from this restructuring process in the very near future -- as a financially strong and agile company, with great employees, loyal advertisers, committed local audiences, and valuable geographic and network diversification among our stations." New Vision's restructuring is subject to the prior consent of the Federal Communications Commission. New Vision has sought such consent and expects approval shortly. "New Vision's tremendous progress in just 60 days is a tribute to everyone who has been involved," concluded New Vision CEO Jason Elkin. "We are grateful for the tremendous faith our debt holders have shown in New Vision's business model and future prospects, and we are thankful for the dedication and loyalty of our employees, advertisers and viewers." New Vision Television is the third station ownership group led by Jason Elkin and an experienced management team. Mr. Elkin's first two station groups were both highly successful. New Vision 3 was formed in July 2006. Moelis & Company is serving as financial advisor to New Vision Television, and Locke Lord Bissell & Liddell is serving as legal counsel for the restructuring. Terms of Plan NV Broadcasting, LLC, and its affiliates filed a disclosure statement to accompany their joint Chapter 11 plan of reorganization, dated as of July 31, 2009, with the U.S. Bankruptcy Court for the District of Delaware. The Plan provides for a restructuring of the Debtors' financial obligations, which will result in a significant deleveraging of the Debtors to better compete in the broadcasting market. Distributions under the Plan will be sourced from an exit secured term loan. The Exit Secured Term Loan is a 3-year first priority senior secured multi-draw term loan facility in an aggregate principal amount of $28,000,000. Pursuant to the Plan, holders of First Lien Loan Claims, allowed in an amount not less than $274,021,842, will receive a transfer of their ratable proportion of 100% of the membership interests in NVT Holdings. Projected recovery under the Plan is 33%. The projected recovery under the Plan for holders of general unsecured trade claims against NV Media, LLC, with allowed amounts of $9,719,803, is 100%. Each allowed NV general unsecured trade claim will (a) be reinstated as an obligation of NVT Networks; (b) receive such treatment as to which NVT Networks will have agreed to in writing; or (c) be treated in any other manner so that such NV general unsecured trade claim will otherwise be rendered unimpaired. Holders of general unsecured claims against PBC, with allowed amount of $600,850, will receive the same treatment as the NV general unsecured trade claims. Holders of the Second Lien Loan Claims who vote to accept the Plan will receive a transfer of its ratable proportion of the Second Lien Equity upon execution of NVT Holdings' amended and restated operating agreement by the members thereof, and holders of the Second Lien Loan Claims who vote to reject the Plan will not receive any transfers of property on account of such holder's Second Lien Loan Claim and the aggregate amount of Second Lien Equity to be transferred pursuant to section 4.7 of the Plan will be reduced by the percentage determined by dividing (x) the aggregate face amount of the Rejecting Second Lien Claims by (y) the total Second Lien Loan Claims. The projected recovery under the Plan for second lien loan claims, which are allowed in the amount of $94,972,735, is 3%. Holders of interests will receive no distribution of property under the Plan, and holders thereof are not entitled to vote, and conclusively presumed to reject the Plan. A full-text copy of the disclosure statement explaining the Debtors' joint Chapter 11 plan is available for free at: http://bankrupt.com/misc/nvbroadcasting.DS.pdf About NV Broadcasting NV Broadcasting, LLC, is a wholly owned subsidiary of NV Television, LLC, which in turn is wholly owned by NV Media, LLC, whose parent is New Vision Television, LLC, who is not a debtor in these cases. PBC Television Holdings is a privately-held limited liability company that owns 100% of PBC Broadcasting, LLC. Todd Parkin owns 100% of the issued and outstanding limited liability company units of PBC Television Holdings. The NV Debtors own and operate 11 television stations that are affiliated with major networks, together with several satellite stations and additional low power television stations that retransmit the signals of the affiliated television stations, and through joint sales or share services agreements, provide sales, operational, and other services to two major network affiliated stations owned by the PBC Debtors. The NV and PBC stations are located in nine diverse markets across the southern, midwestern and nortwestern United States. The NV Debtors and the PBC Debtors filed separate petitions for Chapter 11 relief on July 13, 2009 (Bankr. D. Del. Lead Case No. 09-12473). In its petition, NV Broadcasting, LLC, listed between $10 million and $50 million in assets, and between $100 million and $500 million in liabilities. Locke Lord Bissell & Liddell LLP is the counsel for the NV Debtors. Polsinelli Shughart PC is the Delaware counsel. The PBC Debtors selected Womble Carlyle Sandridge & Rice, PLLC, as their counsel. Moelis & Company is the proposed financial advisor and investment banker to the Debtors. BMC Group Inc. is the Debtors' claims, noticing and balloting agent. OFFICE DEPOT: Sued by Nukote Int'l for $217 Million --------------------------------------------------- Nukote International Inc. has sued Office Depot Inc. before the Bankruptcy Court, which handles Nukote's bankruptcy case, for $217 million, claiming that Office Depot's "egregious fraudulent misrepresentations" caused the Chapter 11 filing, Bloomberg's Bill Rochelle and The Associated Press reported. Nukote, according to the report, contends in the suit that Office Depot was secretly planning to shift the private brand imaging supplies business to another supplier. Office Depot denied it breached any agreement and said "it is Nukote that is indebted to Office Depot," not the other way around. Brian Levine, a spokesman for Office Depot, said in a statement that Nukote stopped shipping in early April, "despite the fact that Office Depot continued to place orders." About Nukote International Headquartered in Franklin, Tennessee, Nukote International, Inc. - - http://www.nukote.com/-- makes ink and toner cartridges for laser and ink-jet printers, copiers, and fax machines. The Company and its affiliates filed for Chapter 11 on June 3, 2009 (Bankr. M. D. Tenn. Lead Case No. 09-06240). Barbara Dale Holmes, Esq., at Harwell Howard Hyne Gabbert & Manner, P., and Frank J. Wright, Esq., at Wright Ginsberg Brusilow PC represent the Debtors in their restructuring efforts. The Debtors have assets and debts both ranging from $10 million to $50 million. Nukote's secured lender CIT Group/Business Credit, Inc. is owed $30 million under a prepetition financing agreement. The $30 million is consists of a $6.3 million term loan and a $23 million revolving line of credit. About Office Depot Office Depot, Inc. is a global supplier of office products and services. The Company is organized into three business segments: North American Retail division, North American Business Solutions division and International division. Its sales are processed through multiple channels, consisting of office supply stores, a contract sales force, an outbound telephone account management sales force, Internet sites, direct marketing catalogs and call centers, supported by its network of crossdocks, warehouses and delivery operations. In April 2008, Office Depot, Inc. and Reliance Retail Limited, a subsidiary of Reliance Industries Limited, announced that they have entered into a joint venture to provide office products and services to business customers in India. Office Depot, Inc. and Reliance also announced the acquisition of eOfficePlanet, one of the dealers of office products and services to corporate customers in India. Standard & Poor's Ratings Services said in June 2009 that its ratings and outlook on Boca Raton, Florida-based Office Depot Inc. (B/Negative/--) are not immediately affected by the company's announcement that it sold $350 million of perpetual convertible preferred stock to BC Partners Inc. ONE LAND: Amends List of 20 Largest Unsecured Creditors ------------------------------------------------------- One Land LLC filed with the U.S. Bankruptcy Court for the Central District of California an amended list of 20 largest unsecured creditors. The Debtor's Largest Unsecured Creditors: Entity Claim Amount ------ ------------ Yong 11 Yoon $850,000 1622 Island Drive Fullerton, CA 92833 Country Inns & Suites $172,177 PO Box sds 12-0586 Minneapolis, MN 55486-0586 Southern California Edison $19,157 P.O. Box 600 Rosemead, CA 91771-0001 US Food Service $7,625 LVMWD $6,861 Delta Mechanical $3,645 The Gas Company $3,053 Lodgenet Interac Corporation $2,607 Contract Design $2,500 KNR Accounting Pro $2,000 Guest Supplies $1,768 Micros Leasing $1,172 COVAD Communications $1,005 Gi Industries $797 Micros Leasing $747 Muzak Craft $598 Orkin Pest Control $489 HD Supply Facilities $405 Maintenance USA Today $260 AT&T Mobility $218 Headquartered in Calabasas, California, One Land LLC operates a hotel named County Inn & Suites at Calabasas. The Company filed for Chapter 11 on Aug. 24, 2009 (Bankr. Case C.D. Calif. No. 09- 20989). Robert M. Yaspan, Esq., at Law Offices of Robert M. Yaspan, represents the Debtor in its restructuring effort. In its petition, the Debtor listed total assets of $15,000,000 and total debts of $15,196,799. ORAGENICS INC: June 30 Balance Sheet Upside-Down by $1.2 Million ---------------------------------------------------------------- Oragenics, Inc.'s balance sheet at June 30, 2009, showed total assets of $2,127,074 and total liabilities of $3,414,745, resulting in a stockholders' deficit of $1,287,671. For three months ended June 30, 2009, the Company posted a net loss of $869,048 compared with a net loss of $1,095,112 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss of $2,849,398 compared with a net loss of $1,886,748 for the same period in 2008. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?448d Headquartered in Alachua, Florida, Oragenics, Inc. (AMEX: ONI) -- http://www.oragenics.com/-- fka Oragen, Inc., operates as an early-stage biotechnology company in the United States. It primarily focuses on developing technologies associated with oral health, broad-spectrum antibiotics, and other general health benefits. The company develops SMaRT Replacement Therapy, which is a painless topical treatment for protection against tooth decay; and Mutacin 1140, an antibiotic with anti-microbial activity against gram-positive bacteria, including methicillin- resistant and vancomycin-resistant Staphylococcus aureus. The company was founded in 1996. Going Concern Doubt On March 31, 2009, Kirkland Russ Murphy & Tapp, PA in Clearwater, Florida expressed substantial doubt about Oragenics, Inc.'s ability to continue as a going concern after auditing the Company's financial statements for the fiscal years ended Dec. 31, 2008, and 2007. The auditor noted that the Company incurred recurring operating losses, negative operating cash flows and has an accumulated deficit. PACIFIC RIM: Says Requirements Cast Doubt on Going Concern ---------------------------------------------------------- Pacific Rim Mining Corp. (TSX:PMU)(NYSE Amex:PMU) said that for the three-month period ended July 31, 2009, it recorded a loss for the period of US$881,000 or US$0.01 per share, compared to a loss of US$3,269,000 or US$0.03 per share for the three month period ended July 31, 2008. The US$2.4 million decrease in net loss for Q1 2010 compared to Q1 2009 is primarily related to significantly lower direct exploration and general and administrative expenses combined with a small gain on the sale of bullion, offset in part by expenses related to the CAFTA action during Q1 2010 for which there is no comparable item in Q1 2009. It had total assets of US$7,147,000 against total debts of US$1,679,000 as of July 31, 2009. Cash was at US$627,000 as of July 31, 2009. The Company said it will require additional funding to maintain its ongoing exploration programs and property commitments as well as for administrative purposes and CAFTA arbitration and negotiation. These requirements, among existing conditions and risks, cast substantial doubt on the validity of the going concern assumption. The Company's ability to continue operations and exploration activities as a going concern is dependent upon its ability to obtain additional funding. The Company will need to raise sufficient funds to pursue ongoing exploration and administration expenses as well as its costs under its CAFTA arbitration. While the Company has been successful in obtaining its required funding in the past, there is no assurance that sufficient funds will be available to the Company in the future. The Company has no assurance that such financing will be available or be available on favourable terms. Factors that could affect the availability of financing include the progress and results of the El Dorado project and its permitting application, the resolution of international arbitration proceedings over the non-issuance of permits in El Salvador, the state of international debt and equity markets, investor perceptions and expectations and the global financial and metals markets. The Company will have to obtain additional financing through, but not limited to, the issuance of additional equity. About Pacific Rim Canada based Pacific Rim Mining Corp. is an environmentally and socially responsible exploration company focused exclusively on high grade, environmentally clean gold deposits in the Americas. Pacific Rim's primary asset and focus of its growth strategy is the high grade, vein-hosted El Dorado gold project in El Salvador. The Company owns several similar grassroots gold projects in El Salvador and is actively seeking additional assets elsewhere in the Americas that fit its project focus. Pacific Rim's shares trade under the symbol PMU on both the Toronto Stock Exchange and the NYSE Amex. Pacific Rim's U.S. and Salvadoran subsidiaries are Pac Rim Cayman LLC, Pacific Rim El Salvador, S.A. de C.V, and Dorado Exploraciones, S.A. de C.V. Pac Rim Cayman LLC, a wholly-owned subsidiary of Pacific Rim Mining Corp. in April 2009 filed international arbitration proceedings against the Government of El Salvador under the Central America-Dominican Republic-United States of America Free Trade Agreement ("CAFTA"). Since 2002 PRES and then later DOREX have been exploring, discovering and delineating gold deposits in El Salvador. The Company's claims under CAFTA are based on alleged breaches of international and Salvadoran law arising out of the Government's improper failure to finalize the permitting process as it is required to do and to respect the Company's and the Enterprises' legal rights to develop mining activities in El Salvador. The Company has retained the Washington, DC-based international law firm of Crowell & Moring, LLP to represent it in the arbitration. PANADERIA RAMOS: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Panaderia Ramos, Limited Liability Company 1817 Eastern Avenue Baltimore, MD 21231 Bankruptcy Case No.: 09-26953 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court District of Maryland (Baltimore) Judge: Robert A. Gordon Debtor's Counsel: Robert B. Greenwalt, Esq. Greenwalt & Sigler 2926 E. Cold Spring Lane Baltimore, MD 21214 Tel: (410) 426-1690 Email: attyrsigler@aol.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $500,001 to $1,000,000 The Company says it does not have unsecured creditors who are non insiders when they filed their petition. The petition was signed by Daisy Ramos, trustee of the Company. PHILADELPHIA NEWSPAPERS: Hearing Delayed on Ad Campaign Dispute --------------------------------------------------------------- Christopher K. Hepp at The Philadelphia Inquirer reports that Chief Bankruptcy Judge Stephen Raslavich convinced lawyers of Philadelphia Newspapers LLC and the Official Committee to forgo a hearing on the Debtor's "Keep It Local!" ad campaign until next week. According to The Inquirer, Judge Raslavich said that the conflict over the publicity campaign was a distracting sideshow. "I have a difficult time seeing how . . . large, sophisticated lenders are going to be deterred by those ads," the report quoted Judge Raslavich as saying. Judge Raslavich said that the dispute might be easily resolved if the buyers paid for the ads. Meanwhile, Philadelphia Newspapers issued a stinging rebuke of its Official Committee of Unsecured Creditors' motion to keep the publisher from advertising the sale of its assets to local owners, saying the Bankruptcy Court has no jurisdiction to grant such an order, according to Law360. As reported by the TCR on September 9, 2009, Philadelphia Newspapers was scheduled to appear before the Bankruptcy Court to defend itself against a motion by the Committee to stop the Company's "Keep It Local" advertising campaign designed to drum up support for selling the business to a group of insiders including Bruce E. Toll, vice chairman of homebuilder Toll Brothers Inc. The Creditors Committee said that Philadelphia Newspapers' using of its own pages to tout its reorganization plan was "highly inappropriate" and describe the move as a publicity campaign in favor of the sale to the stalking-horse bidder [a group of local investors led by homebuilder Bruce Toll]". The Committee said that the public relations campaign is an inappropriate use of company resources "meant to demonize 'out-of-town' buyers" and favor corporate insiders. About Philadelphia Newspapers Philadelphia Newspapers -- http://www.philly.com/-- owns and operates numerous print and online publications in the Philadelphia market, including the Philadelphia Inquirer, the Philadelphia Daily News, several community newspapers, the region's number one local Web site, philly.com, and a number of related online products. The Company's flagship publications are the Inquirer, the third oldest newspaper in the country and the winner of numerous Pulitzer Prizes and other journalistic recognitions, and the Daily News. Philadelphia Newspapers and its debtor-affiliates filed for Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D. Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors' bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth Paxson LLP is the local counsel. The Debtors' financial advisor is Jefferies & Company Inc. The Garden City Group, Inc. serves as claims and notice agent. Philadelphia Newspapers listed assets and debts of $100 million to $500 million in its bankruptcy petition. PHILADELPHIA NEWSPAPERS: Reciprocal Injunction Applies to Everyone ------------------------------------------------------------------ WestLaw reports that a reciprocal injunction, barring not only the defendants in an adversary proceeding brought by the Chapter 11 debtor-newspaper company and related entities, but also the non- debtor chief executive officer, reporters, editors, and other employees of the debtors from actively pursuing discovery or otherwise participating in underlying state-court litigation against them, was in the best interest of the estate, a Pennsylvania bankruptcy court ruled. Because the debtors were indemnifying their employees in the underlying litigation, the debtors and the employees had an identity of interest such that the debtors could be said to be the real party defendant. The size and complexity of the case, together with the number of employees being sued, presented the unusual circumstance of a debtor needing the time and space of an injunction extended to non-debtor employees. Permitting one-sided litigation to proceed could have collateral estoppel effects, the court noted. Moreover, key employees would be diverted from the debtors' reorganization efforts if the underlying litigation were not stayed completely as it related to the debtors. Finally, the court reasoned, although the litigants were understandably frustrated at the delay, the duration of the injunction would be brief. In re Philadelphia Newspapers LLC, --- B.R. ----, 2009 WL 2749598, 51 Bankr. Ct. Dec. 259 (Bankr. E.D. Pa.). Philadelphia Newspapers brought an adversary proceeding (Bankr. E.D. Pa. Adv. Pro. No. 09-0085) in which they moved for extension of automatic stay to certain non-debtors and for injunctive relief barring plaintiffs in state-court civil actions from pursuing relief against non-debtors that included debtors' chief executive officer and reporters, editors, and employees. The Debtors' request for a preliminary injunction was granted and, on appeal, the District Court, 407 B.R. 606, affirmed. While the appeal was pending, the debtors moved for clarification, seeking to make clear that the preliminary injunction was a reciprocal injunction. The Plaintiff who had brought state-court action against reporter employed by debtor opposed the motion. The Honorable Jean K. FitSimon granted the debtors' motion and held that (1) pursuant to the section of the Bankruptcy Code authorizing the court to issue any order necessary or appropriate to carry out the provisions of title 11, bankruptcy courts may enjoin non-debtor third parties from participating in discovery, and (2) here, a reciprocal injunction, enjoining the defendants in this adversary as well as non-debtor CEO, reporters, editors, and other employees in the underlying litigation, was in the best interest of the estate. Philadelphia Newspapers -- http://www.philly.com/-- owns and operates numerous print and online publications in the Philadelphia market, including the Philadelphia Inquirer, the Philadelphia Daily News, several community newspapers, the region's number one local Web site, philly.com, and a number of related online products. The Company's flagship publications are the Inquirer, the third oldest newspaper in the country and the winner of numerous Pulitzer Prizes and other journalistic recognitions, and the Daily News. Philadelphia Newspapers and its debtor-affiliates filed for Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D. Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors' bankruptcy counsel, and Lawrence G. McMichael, Esq., at Dilworth Paxson LLP is local counsel. The Debtors' financial advisor is Jefferies & Company Inc. T he Garden City Group, Inc. serves as claims and notice agent. Philadelphia Newspapers listed assets and debts of $100 million to $500 million in its bankruptcy petition. PHILMONT SQUARE: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Philmont Square Inc. 3317 Avenue N Brooklyn, NY 11234 Bankruptcy Case No.: 09-47793 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Eastern District of New York (Brooklyn) Judge: Jerome Feller Debtor's Counsel: David Carlebach, Esq. 40 Exchange Place, Suite 1306 New York, NY 10005 Tel: (212) 785-3041 Fax: (212) 785-3618 Email: carlebac@aol.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Yehuda Nelkenbaum, president of the Company. PLAINFIELD APARTMENTS: Connection With Connolly Properties Probed ----------------------------------------------------------------- Mark Spivey at MyCentralJersey.com reports that Connolly Properties Inc. President and CEO David M. Connolly was questioned by the Office of the U.S. Trustee trial attorney Mitchell Hausman on Plainfield Apartments LLC's bankruptcy filing and on his firm's relationship with the Debtor. MyCentralJersey.com states that Mr. Connolly cited occupancy as reason for the bankruptcy filing of Plainfield Apartments, for which he is the trustee. Citing Mr. Connolly, MyCentralJersey.com says that there "cash flow problems stemming from high vacancy". Mr. Connolly said that he purchased the nine properties owned by Plainfield Apartments six years ago for about $13 million, but they haven't been appraised within the last two years, MyCentralJersey.com states. Mr. Hausman asked Mr. Connolly how he will boost revenue to start paying off some of his creditors, MyCentralJersey.com reports. Citing Mr. Connolly, MyCentralJersey.com states that Connolly Properties has been increasing advertising, hiring new staff, and running specials as ways to create an "even better standard." MyCentralJersey.com relates that Spencer Savings Bank attorney Vincent J. Massa III also questioned Mr. Connolly on Connolly Properties' relationship with Plainfield Apartments. Connolly Properties "doesn't really generate income," but "exists to serve the various entities that it manages," the report says, citing Mr. Connolly. A bankruptcy plan for Plainfield Apartments will be submitted to U.S. Bankruptcy Judge Morris Stern by December 7, MyCentralJersey.com states. According to MyCentralJersey.com, Mr. Connolly told Mr. Hausman that he is reducing his Connolly Properties salary to $250,000, from $380,000, effective September 18, citing "budgeting reasons". According to MyCentralJersey.com, the combined debts listed in the bankruptcy cases of companies affiliated with Connolly Properties approach $50 million, and almost 1,000 of the 3,000 apartment units managed by Connolly Properties are either tied up in bankruptcy proceedings or are listed for sale. Plainfield, New Jersey-based Plainfield Apartments, LLC, filed for Chapter 11 on Aug. 7, 2009 (Bankr. D. N.J. Case No. 09-30679). Richard D. Trenk, Esq., at Trenk, DiPasquale, Webster, Della Fera & Sodono, P.C., represents the Debtor in its restructuring efforts. In its petition, the Debtor listed total assets of $14,181,853 and total debts of $17,587,846. An affiliate, Fulton-Harrison LLC, filed for protection in the same court on July 29, 2009 (Case No. 09-29666). PLAINS EXPLORATION: Moody's Affirms 'Ba3' Corporate Family Rating ----------------------------------------------------------------- Moody's Investors Service affirmed Plains Exploration and Production's Ba3 Corporate Family Rating and Probability of Default Rating, rated its new $300 million senior unsecured notes B1 (LGD 4; 64%), and changed the LGD point estimate on its existing senior unsecured notes to LGD 4; 64% from LGD 4; 65%. The ratings outlook remains negative. This action follows PXP's announced $300 million senior unsecured note offering. Proceeds from the offering will be used for general corporate purposes, including funding a portion of the payment of the remaining drilling carry under its agreement with Chesapeake Energy Corporation. On August 12, 2009 PXP completed a $400 million ($397 million net proceeds) equity offering as part of the funding for its $1.1 billion buyout of drilling carry under the agreement with Chesapeake. Adjusted debt / average daily production, for June 30, 2009 pro-forma the $1.1b buyout, the $400 million equity offering, and the $300 million note offering will be approximately $30,286/boe with adjusted debt / proved developed reserves of $11.67. The negative outlook reflects the ratings' dependence on substantial improvement in underlying reserve replacement costs, delivery of sound production growth going into 2010 commensurate with capital spending, stronger oil prices, and leverage reduction. Moody's believe 2009 finding and development costs will be very high due to the cost of the Chesapeake carried interest during 2009 and then prepaying $1.1 billion of the remaining burden later this year. After netting out such costs to estimate underlying conditions heading into 2010, normalized reserve replacement costs will need to be competitive. The ratings are further supported by scale still compatible with the ratings; sound liquidity and covenant clearance; a long-lived base of California reserves needing low levels of capital spending to sustain production; a so far promising large Haynesville acreage position; and potentially sizable asset monetization, including potential Gulf of Mexico discoveries and prospects. Key support for the ratings also comes from a strong hedging program with 80% of anticipated 2009 and 70% of anticipated 2010 production hedged at favorable prices. Important determinants of PXP's outlook and ratings will be whether PXP substantially reduces its 2009 reserve replacement costs, the quality of the underlying components of those metrics, and production momentum going into 2010. PXP posted very weak drillbit reserve replacement rates, and unsustainably high replacement costs during 2008. Though this was mostly due to major negative oil price-related reserve revisions at year-end 2008 and the $1.65 billion front-end outlay for the Haynesville JV, net of those factors drillbit replacement costs were still high, in the range of $30/boe. Leverage on proven developed reserves and on production is high for the ratings, reflecting the 2008 front-end cost of buying into 50% of 20% of Chesapeake's Haynesville acreage, the related carried interest costs, and heavy Gulf of Mexico capital outlays, and will need to decline during 2010. Leverage on reported year- end 2009 reserves could decline if higher oil prices remain significantly above the year-end 2008 levels used to set the economic threshold of reserves. Moody's last rating action for PXP was on August 10, 2009, at which time Moody's affirmed its Ba3 Corporate Family Rating, Ba3 Probability of Default Rating, and B1 senior unsecured note ratings with a negative outlook. Plains Exploration & Production Company is headquartered in Houston, Texas. PNG VENTURES: Files Chapter 11 With Restructuring Plan ------------------------------------------------------ PNG Ventures, Inc., and its wholly owned subsidiaries, New Earth LNG, LLC, Arizona LNG, LLC, Applied LNG Technologies USA, LLC, Fleet Star, Inc., and Earth Leasing, Inc., on September 10 filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The filings were made to facilitate a broad-based debt restructuring plan which contemplates conversion of a majority of the Company's outstanding debt to new common equity, and to mitigate the impact of certain onerous contracts inherited as part of the Company's June 30, 2008 Share Exchange Transaction with Earth Biofuels, Inc. Throughout the reorganization process, the Company will continue to operate its business in the ordinary course and does not expect that the Chapter 11 filing will have any adverse effect on its day-to-day operations or delivery of products or services to its customers. Cem Hacioglu, President and CEO of PNG Ventures, said, in a September 10 statement, "Restructuring and recapitalizing our balance sheet is a critical step in positioning the Company to take advantage of the tremendous growth opportunities in the alternative fuels market. Today's action will allow us to secure long-term relief from some of the debilitating legacy debt and operational impediments we inherited when the Company acquired its baseline LNG operations from Earth Biofuels in June 2008 and maintain our leadership position in providing innovative natural gas based fueling solutions to our customers. We will emerge from this process with substantially less debt and a dramatically improved capital structure which, in turn, will position us to be a stronger competitor and further support our long-term objective of becoming the preeminent provider of cleaner burning fuels for the domestic and international markets." In conjunction with its Chapter 11 petitions and standard and customary first day motions, the Company's filing included a proposed Plan of Reorganization that contemplates, among others: (i) settlement of the majority of the Company's senior credit facility for approximately 66% of the common stock of the newly reorganized Company, with the balance being settled for a combination of cash and a new four-year term loan; (ii) settlement of the Company's trade debt and unsecured debt for approximately 28% of allowable claim amounts and 7.5% of the common stock of the newly reorganized Company; and (iii) securing financing of approximately $8.4 million to fund the Plan, for a combination of a new four-year term loan and approximately 26.5% of the new common stock of the newly reorganized Company. Under the proposed Plan, existing equity would be eliminated, including all options, warrants and other derivative instruments that are linked to the Company's existing equity. About PNG Ventures, Inc. Through its Applied LNG Technologies and other subsidiaries, the Company engages in the production, distribution, and sale of liquefied natural gas to customers consisting of public utilities, industrial end-users and other fleet customers within the transportation, manufacturing, distribution, and municipal markets, primarily in California, Arizona, and Nevada. The Company also offers turnkey fuel solutions, including delivery, equipment storage, fuel dispensing equipment, and fuel loading facilities. PNG Ventures and its affiliates filed for Chapter 11 on September 10, 2009 (Bankr. D. Del. Case No. 09-13162). Attorneys at Fox Rothschild LLP represent the Debtors in their restructuring effort. Logan & Co. serves as claims and notice agent. As of June 30, 2009, PNG had total assets of $41,416,000 against total debts of $47,519,000. PRIMARIS REIT: DBRS Confirms Issuer Rating at 'BB' -------------------------------------------------- DBRS has confirmed the BB (high) Issuer Rating of Primaris Retail Real Estate Investment Trust, as the Trust continues to maintain a reasonable credit profile with support from its conservative balance sheet, good operating metrics and significant liquidity position to meet its modest near-term capital requirements. The rating confirmation reflects the fact that Primaris continues to operate with a significant liquidity position consisting of $58.7 million of cash on hand and an unused $120 million revolving credit facility (matures on July 31, 2010) as at Q2 2009. In addition, DBRS believes Primaris has appropriately managed its balance sheet, with conservative debt levels. For the last 12 months (LTM) ended Q2 2009, the Trust had a debt-to-gross book value assets ratio of 49.5% (54.5% including convertible debentures) and EBITDA interest coverage of 2.41 times, which compares favourably with other DBRS-rated REITs. While the Trust's financial flexibility is reduced by its relatively high payout ratio of 116.4% (DBRS adjusted for maintenance capital and leasing costs) for the LTM Q2 2009, DBRS believes this shortfall is manageable in the near term and has good support from the Trust's conservative balance sheet and strong liquidity position. The Trust also has little or no exposure to refinancing risk over the next couple of years, with only $3.7 million of principal repayments (the balance is in the form of mortgage amortization) for the remainder of 2009 and no principal repayments in 2010. The rating confirmation also takes into consideration that the Trust has a mid-sized portfolio consisting of primarily enclosed shopping malls, which are generally well-maintained and diversified in secondary and primary markets across Canada. Despite the challenging broader economic conditions, Primaris' portfolio continues to perform reasonably well and achieve higher rental rates on lease renewals with a 3.3% increase in average rental rates over expiring rates (lease renewals represented 79% of the 332,729 square feet (sq. ft.) of leased space during Q2 2009). The Trust's properties also continue to achieve high occupancy levels (96.4% as at Q2 2009), which is in line with the Trust's retail REIT peers and its historical range of 96% to 98%. Nevertheless, DBRS expects broader economic and retailing conditions to remain challenging for 2009 and into 2010, which could put pressure on the Trust's cash flow levels and the performance of its tenants. DBRS notes that Primaris' same-tenant sales have declined for two consecutive quarters in 2009, which could have a negative impact on future rental rates. While tenant disruptions have been very manageable to date, the Trust's focus on enclosed shopping malls exposes it to tenants who concentrate on discretionary goods/services and to the performance of large anchor tenants, including The Bay and Zellers and Sears Canada. As at Q2 2009, HBC and Sears Canada represented approximately 28.4% of total leasable square feet. Given this significant concentration, DBRS notes that loss of an anchor tenant could have a negative impact on overall performance of the anchored property, including existing ancillary tenants. DBRS does note, however, that Primaris has been able to accommodate changes in anchor tenants from store closures in recent years, which has generally produced higher overall net rental income. Overall, DBRS believes that this risk is manageable in the near term and expects Primaris' credit profile to remain stable, with support from its balance sheet flexibility and significant liquidity position. In addition, Primaris has modest lease maturities for the remainder of 2009, which should provide reasonable support to cash flow levels and limit exposure to the difficult leasing conditions expected throughout 2009. Primaris Retail Real Estate Investment Trust -- http://www.primarisreit.com/-- owns 26 income-producing properties comprising approximately 9.3 million square feet located in Canada. As of August 31, 2009, the REIT had 62,453,740 units issued and outstanding. QUEBECOR WORLD: Centerbridge Has 12% Stake in Reorganized Company ----------------------------------------------------------------- In connection with the reorganization and financial restructuring of World Color Press Inc., formerly Quebecor World Inc., Centerbridge Credit Partners Master, L.P., together with its affiliates acquired ownership of, in the aggregate, 6,810,885 common shares, 1,318,684 Class A convertible preferred shares, 503,687 series I common share purchase warrants and 503,687 series II common share purchase warrants, of WCPI pursuant to the Plans. The Centerbridge Entities subsequently disposed of 18,000 Common Shares to hold, in the aggregate, 6,792,885 Common Shares. The security holdings of each of the Centerbridge Entities are disclosed in their early warning report dated September 9, 2009. Each Preferred Share is convertible at the option of the holder into one Common Share. Subject to certain conditions set out in the warrant indenture under which the Warrants were issued, each Warrant is exercisable into one Common Share on or before July 20, 2014. The 1,318,684 Preferred Shares represent approximately 10.54% of the issued and outstanding Preferred Shares. Assuming the conversion of all of the Preferred Shares held by the Centerbridge Entities into Common Shares and the exercise of all of the Warrants held by the Centerbridge Entities, the Centerbridge Entities' aggregate securityholding percentage in the Common Shares is approximately 12.06% of the Common Shares that would then be outstanding, calculated on a partially diluted basis. The Preferred Shares, Common Shares and Warrants were issued as a result of the implementation of a plan of reorganization and compromise of Quebecor, as amended and modified, pursuant to the provisions of the Companies' Creditors Arrangement Act (Canada) and a U.S. joint plan of reorganization of Quebecor World (USA) Inc., as amended, pursuant to the provisions of Chapter 11 of the US Bankruptcy Code. Pursuant to and in accordance with the Plans, the Securities were issued as settlement of certain indebtedness of Quebecor held by the Centerbridge Entities. The Securities acquired by the Centerbridge Entities include (i) Securities received by the Centerbridge Entities from escrow on August 26, 2009 and September 3, 2009 in accordance with the Plans, and (ii) Securities acquired in connection with the acquisition of certain indebtedness of Quebecor, which acquisitions have not yet settled. The Securities were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of WCPI. Depending on market and other conditions, the Centerbridge Entities may, from time to time, acquire additional securities of WCPI or may dispose of the Securities, in whole or in part. READER'S DIGEST: Sec. 341 Meeting of Creditors Set for October 2 ---------------------------------------------------------------- Diana G. Adams, U.S. Trustee for Region 2, will convene a meeting of creditors of The Reader's Digest Association, Inc., and its 47 debtor affiliates on October 2, 2009, at 3:00 p.m., at the Office of the U.S. Trustee at 80 Broad Street, 4th Floor, in New York. This is the first meeting of creditors required under Section 341(a) of the Bankruptcy Code in the Debtors' bankruptcy cases. Attendance by the Debtors' creditors at the meeting is welcome, but not required. The Section 341(a) meeting offers the creditors a one-time opportunity to examine the Debtor's representative under oath about the Debtor's financial affairs and operations that would be of interest to the general body of creditors. About The Reader's Digest Association RDA is a global multi-brand media and marketing company that educates, entertains and connects audiences around the world. The company builds multi-platform communities based on branded content. With offices in 44 countries, it markets books, magazines, and music, video and educational products reaching a customer base of 130 million in 78 countries. It publishes 94 magazines, including 50 editions of Reader's Digest, the world's largest-circulation magazine, operates 65 branded Web sites generating 22 million unique visitors per month, and sells 40 million books, music and video products across the world each year. Its global headquarters are in Pleasantville, N.Y. Reader's Digest said that as of June 30, 2009, it had total assets of $2.2 billion against total debts of $3.4 billion. Reader's Digest, together with its 47 affiliates, filed for Chapter 11 on August 24 (Bankr. S.D.N.Y. Case No. 09-23529). Kirkland & Ellis LLP has been engaged as general restructuring counsel. Mallet-Prevost, Colt & Mosle LLP has been tapped as conflicts counsel. Ernst & Young LLP is auditor. Miller Buckfire & Co, LLC, is financial advisor. AlixPartners, LLC, is restructuring consultant. Kurtzman Carson Consultants is notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Reader's Digest Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Reader's Digest and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) READER'S DIGEST: Proposes AlixPartners as Advisor ------------------------------------------------- The Reader's Digest Association Inc. and its affiliates seek authority from Judge Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York to employ AlixPartners LLP as their restructuring advisor, nunc pro tunc to the Petition Date, and in accordance with the terms and conditions set forth in an Engagement Letter dated April 17, 2009, between the Debtors and AlixPartners, as amended on September 1, 2009. As advisor, AlixPartners has agreed to: (a) assist the Debtors in developing a global operating plan and long term business plan, which will facilitate the development of potential cost reduction opportunities, management financial matrices, and key reporting matrices for the Debtors; (b) assist the Debtors in developing and implementing a global cash management system, processes and procedures that provide management visibility across operations; (c) advise the Debtors' senior management with respect to the negotiation and implementation of restructuring initiatives; (d) assist the Debtors in managing the "working group" professionals, who are assisting the Debtors in the reorganization process or who are working for the Debtors' various stakeholders to improve coordination of their effort and individual work product to be consistent with the Debtors' overall restructuring goals; (e) assist in obtaining and presenting information required by parties-in-interest in the Debtors' bankruptcy process, including official committees appointed by the Court and the Court itself; (f) assist the Debtors in other business and financial aspects of a Chapter 11 proceeding, including development of a disclosure statement and plan of reorganization; (g) assist in preparing for and filing a Bankruptcy Petition and coordinating and providing administrative support for the proceeding; (h) assist with the preparation of the statement of financial affairs, schedules and other regular reports required by the Court as well as providing assistance in areas as testimony before the Court on matters that are within AlixPartners' areas of expertise; (i) manage the claims and claims reconciliation processes; (j) assist in developing and implementing contingency plans outside of the United States of America; and (k) assist the Debtors with other matters as may be requested by management that fall within AlixPartners' expertise and are mutually agreeable. The Debtors and AlixPartners agree that all of the services that AlixPartners will provide to the Debtors will be (i) appropriately directed by the Debtors so as to avoid duplicative efforts among the other professionals retained in the cases, and (ii) performed in accordance with applicable standards of the profession. Thomas A. Williams, Chief Financial Officer and Senior Vice President of The Reader's Digest Association, Inc., tells Judge Drain that if AlixPartners finds it desirable to augment its professional staff with independent contractors in the Debtors' Chapter 11 cases: -- AlixPartners will file declarations disclosing the Independent Contractors' relationships, if any, with any parties-in-interest, and indicating that the Independent Contractor is disinterested; -- the Independent Contractor will remain disinterested during the time that it is involved in providing services on behalf of the Debtors; and -- the Independent Contractor will represent that he or she will not work for the Debtors or other parties-in-interest during the time AlixPartners is involved in providing services to the Debtors, except as an Independent Contractor of AlixPartners. AlixPartners will charge the Debtors for an Independent Contractor's services at the rate charged to AlixPartners by the Independent Contractor. Mr. Williams says AlixPartners' compensation arrangements under the Engagement Letter -- hourly-based or performance-based compensation, indemnification and reimbursement -- are consistent with and typical of compensation arrangements entered into in respect of similar services provided under similar circumstances to companies undergoing restructuring. Pursuant to the Engagement Letter, the Debtors and AlixPartners have agreed to this hourly-based compensation: United United Germany/ Position States Kingdom France/Italy -------- ------ ------- ------------ Managing Dir. $685-$995 GBP525-GBP620 EUR675-EUR800 Director $510-$685 GBP420-GBP500 EUR525-EUR630 Vice President $395-$505 GBP290-GBP380 EUR420-EUR520 Associate $260-$365 GBP210-GBP280 EUR315-EUR420 Analyst $235-$260 GBP140-GBP155 EUR275 Paraprofessional $180-$200 GBP125 EUR210 AlixPartners typically works for compensation that includes hourly-based fees and performance-based contingent incentive compensation earned upon achieving meaningful results, Mr. Williams tells the Court. In this Chapter 11 proceeding, the Debtors and AlixPartners have agreed on success fee compensation based on several specific metrics upon consummation of a Chapter 11 plan of reorganization. The Debtors understand and acknowledge that the Contingent Success Fee is an integral part of AlixPartners' compensation for the engagement. The Debtors and AlixPartners acknowledge that payment of the Contingent Success Fee will require approval of the Court and that post-effective date payment of the Success Fee will require assumption of the Engagement Letter in connection with confirmation of a plan. Hence, the Debtors will seek assumption of the Engagement Letter as part of a plan. The Contingent Success Fee is based on these metrics: (a) time to exit from Chapter 11, or the "Timing Metric"; (b) improvements above the pre-bonus EBITDA, or the "EBITDA Improvement Metric"; and (c) Restructuring of certain liabilities, or the "Project California Metric." The Contingent Success Fee will have been earned when the success objective or objectives have been achieved with respect to specific metrics. To the extent that a specific metric is achieved on or before the effective date of a plan of reorganization, AlixPartners will file an application for Court approval of that portion of the Contingent Success Fee, which may be subject to a standard of reasonableness and which will be paid upon consummation of a plan and approval by the Court. The Debtors do not owe AlixPartners any amount for services performed or expenses incurred prior to the Petition Date, and thus, AlixPartners is not a prepetition creditor of the Debtors. However, Mr. Williams says that according to the Debtors' books and records, during the 90 days prior to the commencement of the bankruptcy cases, AlixPartners invoiced the Debtors $7,760,121 for professional services performed and expenses incurred up to and as of the Petition Date. Of the invoiced amounts, AlixPartners received payments totaling $7,760,121. "AlixPartners continues to hold a retainer of $500,000. Subsequent to the Commencement Date, AlixPartners will true-up all pre-petition fees and expenses and the retainer will be accordingly adjusted," Mr. Williams relates. "All payments have been applied to outstanding invoices on account of fees and expenses incurred in providing services to the Debtors in connection with their prepetition restructuring activities. AlixPartners will continue to hold any remaining retainer for application to any additional fees and expenses incurred during the bankruptcy proceedings," he adds. Mr. Williams also inform the Court that the Engagement Letter contains standard indemnification language with respect to AlixPartners' services including an agreement by the Debtors to indemnify AlixPartners, its affiliates, partners and other employees from and against all claims and liabilities arising out of or in connection with the firm's engagement. The Debtors intend that the services of AlixPartners will complement and not duplicate the services rendered by any other professional retained in the cases, Mr. Williams asserts. He notes that AlixPartners understands that the Debtors have retained and may retain additional professionals, and agrees to work cooperatively with the other professionals to integrate any respective work conducted by the professionals. Lawrence Young, a managing director of AlixPartners, assures Judge Drain that AlixPartners is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. In another request, the Debtors sought and obtained the Court's authority to file under seal a certain exhibit related to the September 1 Amendment to the Engagement Letter. The Amendment establishes the terms of the Contingent Success Fee, and defines additional tasks not previously set forth in the original Engagement Letter. The Debtors subsequently filed with the Court the confidential Amendment. A hearing will be held on September 17, 2009, to consider the application. Objections are due September 14. About The Reader's Digest Association RDA is a global multi-brand media and marketing company that educates, entertains and connects audiences around the world. The company builds multi-platform communities based on branded content. With offices in 44 countries, it markets books, magazines, and music, video and educational products reaching a customer base of 130 million in 78 countries. It publishes 94 magazines, including 50 editions of Reader's Digest, the world's largest-circulation magazine, operates 65 branded Web sites generating 22 million unique visitors per month, and sells 40 million books, music and video products across the world each year. Its global headquarters are in Pleasantville, N.Y. Reader's Digest said that as of June 30, 2009, it had total assets of $2.2 billion against total debts of $3.4 billion. Reader's Digest, together with its 47 affiliates, filed for Chapter 11 on August 24 (Bankr. S.D.N.Y. Case No. 09-23529). Kirkland & Ellis LLP has been engaged as general restructuring counsel. Mallet-Prevost, Colt & Mosle LLP has been tapped as conflicts counsel. Ernst & Young LLP is auditor. Miller Buckfire & Co, LLC, is financial advisor. AlixPartners, LLC, is restructuring consultant. Kurtzman Carson Consultants is notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Reader's Digest Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Reader's Digest and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) READER'S DIGEST: Proposes Ernst & Young as Auditor -------------------------------------------------- The Reader's Digest Association Inc. and its affiliates seek the Court's permission to employ Ernst & Young LLP as their independent auditor and tax services provider, nunc pro tunc to the Petition Date, and in accordance with the parties' engagement letters. As auditor, E&Y has agreed to: (a) audit and report on the consolidated financial statements of the Debtors for the year ended June 30, 2009; (b) perform tax services as set forth in each specific Statement of Work issued under the parties' Master Tax Services Agreement; (c) work with the Debtors in developing an understanding of the tax issues and options related to the Debtors' Chapter 11 filings, taking into account the Debtors' specific facts and circumstances, for U.S. federal, international and state and local tax purposes. The analysis may include, among other things: * understanding reorganization and restructuring alternatives the Debtors are evaluating with existing bondholders and other creditors that may result in a change in the equity, capitalization and ownership of the shares of the Debtors or their assets, including an analysis of the Debtors' current internal equity and indebtedness structure; * assisting and advising the Debtors in developing an understanding of the tax implications of its bankruptcy restructuring alternatives and post-bankruptcy operations including, research and analysis of treatises, Internal Revenue Code sections, Treasury regulations, case law and other relevant tax authority, and in securing rulings from the Internal Revenue Service or applicable state and local or foreign tax authorities with respect to income taxes and operating and above-the-line taxes; and * providing tax advisory services regarding availability, limitations and preservation of tax attributes, like net operating losses and alternative minimum tax credits, analyzing impact of cancellation of indebtedness income on those attributes, reduction or deferral of tax costs in connection with stock or asset sales; (d) will respond to general federal, state and local and international tax questions and assignments that are expected, at the beginning of the project, to involve total professional time not to exceed, with respect to the specific project, $25,000 in professional fees; (e) will: * review the Master Services Agreement between The Reader's Digest Association, Inc., and Printmanagement GmbH from a Value Added Tax and Customs perspective; * identify and discuss VAT and Customs issues that are affected by the new agreement; * as appropriate, propose changes to the Master Services Agreement from a VAT and Customs perspective; and * review and provide VAT and Customs advice on other arrangements entered into by the Debtors as new contracts arise and as requested by the Debtors; (f) provide these tax services: * assist with preparation of Puerto Rico Personal Property tax returns for CompassLearning, Inc., Puerto Rico Branch, for years 2004 to 2008; * assist with registration with the Municipality of San Juan and preparation of the required Municipal License Tax Declarations for CompassLearning, Puerto Rico Branch; and * provide the Debtors with routine tax advice related to assistance in obtaining necessary tax compliance certificates from various Puerto Rico fiscal agencies; and (g) provide Global Tax Operations Outsourcing Services to the Debtors and their subsidiaries through tax years ended June 30, 2010 with respect to the varying local country tax year end. E&Y will be paid for its audit services rendered in the cases (i) at a flat fee of $400,000 for up to 3,600 hours of those services, and (ii) at an hourly billing rate of $200 per hour for any Audit Services in excess of 3,600 hours. For its Bankruptcy Tax Services, E&Y will be paid on its hourly rates for those services at: Professional/Position Hourly Rate --------------------- ----------- Partners/Principals $600 Executive Directors $515 Senior Managers $480 Managers $420 Seniors $300 Staff $210 E&Y will be paid for its Routine On-Call Tax Services and VAT and Customs Tax Services, as well as any out of scope services under the Puerto Rico Tax Services Agreement, at these hourly rates: Professional/Position Hourly Rate --------------------- ----------- Partners/Principals $547 Executive Directors $517 Senior Managers $487 Managers $426 Seniors $304 Staff $213 Client Serving Associates $109 The Debtors will also pay E&Y for any Routine On-Call Tax Services provided by certain Ernst & Young Global Limited foreign member firms based on the applicable hourly rates for the E&Y Entities as set forth in the parties' Routine On-Call Tax Services Agreement. Pursuant to the terms and conditions of the parties' Audit Services Agreement, E&Y will be paid for its Puerto Rico Tax Services on these flat rates: Personal Property Tax Returns $4,500 each Municipality Licenses Tax Declarations $7,500 each Tax Certifications $17,858 each Under the Audit Services Agreement, the Global Tax Operations Outsourcing Services will be billed by the various E&Y Entities providing services directly to the corresponding Local Client Entities, which are non-debtor entities. Neither E&Y LLP nor any E&Y Entities will charge the Debtors for any Global Tax Operations Outsourcing Services rendered. The E&Y Entities will assist E&Y LLP in the provision of services under the Routine On Call Tax Services Agreement, the Puerto Rico Tax Services Agreement, the VAT & Customs Tax Services Agreement and the Global Tax Operations Outsourcing Services Agreement -- an arrangement that is beneficial to the Debtors' bankruptcy estates because through an integrated approach to the provision of professional services, E&Y LLP and the E&Y Entities will be able to efficiently provide a cohesive network of quality services to the Debtors, among other reasons, Thomas A. Williams, Chief Financial Officer and Senior Vice President of The Reader's Digest Association, Inc., tells Judge Drain. As of the Petition Date, the Debtors owe $8,281 to E&Y for services provided by the firm prepetition. Upon approval of E&Y's retention in the bankruptcy cases, the firm will waive its right to receive any fees incurred on the Debtors' behalf prior to the Petition Date, Mr. Williams discloses. He further reveals that during the 90 days immediately preceding the commencement of the cases, the Debtors paid to E&Y fees totaling $807,694. He adds that E&Y is currently holding a retainer totaling $1,723, which will be applied by E&Y in payment of compensation and reimbursement of expenses incurred in the future. Martin G. Shannon, a partner at E&Y LLP, assures Judge Drain that his firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, as required by Section 327(a) of the Bankruptcy Code. The Court will commence a hearing on September 17, 2009, to consider the application. Objections are due September 14. About The Reader's Digest Association RDA is a global multi-brand media and marketing company that educates, entertains and connects audiences around the world. The company builds multi-platform communities based on branded content. With offices in 44 countries, it markets books, magazines, and music, video and educational products reaching a customer base of 130 million in 78 countries. It publishes 94 magazines, including 50 editions of Reader's Digest, the world's largest-circulation magazine, operates 65 branded Web sites generating 22 million unique visitors per month, and sells 40 million books, music and video products across the world each year. Its global headquarters are in Pleasantville, N.Y. Reader's Digest said that as of June 30, 2009, it had total assets of $2.2 billion against total debts of $3.4 billion. Reader's Digest, together with its 47 affiliates, filed for Chapter 11 on August 24 (Bankr. S.D.N.Y. Case No. 09-23529). Kirkland & Ellis LLP has been engaged as general restructuring counsel. Mallet-Prevost, Colt & Mosle LLP has been tapped as conflicts counsel. Ernst & Young LLP is auditor. Miller Buckfire & Co, LLC, is financial advisor. AlixPartners, LLC, is restructuring consultant. Kurtzman Carson Consultants is notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Reader's Digest Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Reader's Digest and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) READER'S DIGEST: Still Optimistic Despite Bankruptcy ---------------------------------------------------- Despite being under the Chapter 11 bankruptcy protection, 87-year- old Reader's Digest magazine has remained optimistic. "It's business as usual," Peggy Northrop, Reader's Digest editor- in-chief since 2007, said in an interview with the Associated Press. She added that "all the stories I read about the death of print are in print!" on issues about the demise of print media. "We are quite healthy," The Pittsburgh Post-Gazette quoted Ms. Northrop as saying. "Eighty percent of our debt-holders have agreed to restructure our debt. It gives us a lot of freedom to breathe. It's like refinancing a house mortgage," she added. "We're still the biggest, best-read magazine in the world," Ms. Northrop said about Reader's Digest declining circulation. Reader's Digest's circulation has been declining every year since the 1990s according to Joyce Gannon of the Post-Gazette. The decline is mostly due to the digital age and the Internet. Reader's Digest, however, has turned to make use of the digital technology. According to tracking firm comScore, Reader's Digest's Web site's average unique visitor per month rose 23% year-over-year in July 2009 to 1.2 million, AP reported. Ms. Northrop told AP that there is an electronic version of Reader's Digest on Amazon's Kindle electronic reading device, and an iPhone app is coming soon. Ms. Northrop also told AP that Reader's Digest has reduced its work force by 8% across the United States of America. As previously announced by the company, Reader's Digest will reduce its U.S. base rate circulation and its annual issues will be cut from 12 to 10 starting February 2010. "[A]ll the giant magazines have made as an investment less in paper and more in the Internet," Ms. Northrop is quoted by Post- Gazette on the drop on circulation and monthly issues. "It's a sign we are managing the business very well and very profitably," she continued. About The Reader's Digest Association RDA is a global multi-brand media and marketing company that educates, entertains and connects audiences around the world. The company builds multi-platform communities based on branded content. With offices in 44 countries, it markets books, magazines, and music, video and educational products reaching a customer base of 130 million in 78 countries. It publishes 94 magazines, including 50 editions of Reader's Digest, the world's largest-circulation magazine, operates 65 branded Web sites generating 22 million unique visitors per month, and sells 40 million books, music and video products across the world each year. Its global headquarters are in Pleasantville, N.Y. Reader's Digest said that as of June 30, 2009, it had total assets of $2.2 billion against total debts of $3.4 billion. Reader's Digest, together with its 47 affiliates, filed for Chapter 11 on August 24 (Bankr. S.D.N.Y. Case No. 09-23529). Kirkland & Ellis LLP has been engaged as general restructuring counsel. Mallet-Prevost, Colt & Mosle LLP has been tapped as conflicts counsel. Ernst & Young LLP is auditor. Miller Buckfire & Co, LLC, is financial advisor. AlixPartners, LLC, is restructuring consultant. Kurtzman Carson Consultants is notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Reader's Digest Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Reader's Digest and its affiliates (http://bankrupt.com/newsstand/or 215/945-7000) RENAISSANCE RESIDENTIAL: Must File Chapter 11 Plan by December 24 ----------------------------------------------------------------- The Hon. John H. Squires of the U.S. Bankruptcy Court for the Northern District of Illinois required Renaissance Residential of Countryside LLC to file a Chapter 11 plan of reorganization and disclosure statement explaining the plan by Dec. 24, 2009. Based in Palatine, Illinois, Renaissance Residential of Countryside LLC filed for Chapter 11 protection on Aug. 26, 2009 (Bankr. N.D. Ill. Case No. 09-31460). Richard H. Fimoff, Esq., Robbins, Salomon & Patt Ltd., represents the Debtor in its restructuring efforts. In its petition, the Debtor listed assets between $50 million and $100 million, and debt between $10 million and $50 million. RENAISSANCE RESIDENTIAL: Section 341(a) Meeting Set for October 1 ----------------------------------------------------------------- The U.S. Trustee for Region 10 will convene a meeting of creditors in Renaissance Residential of Countryside, LLC's Chapter 11 case on Oct. 1, 2009, at 1:30 p.m. The meeting will be held at 219 South Dearborn, Office of the U.S. Trustee, 8th Floor, Room 802, Chicago, Illinois. 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. Palatine, Illinois-based Renaissance Residential of Countryside, LLC filed for Chapter 11 on Aug. 26, 2009 (Bankr. N.D. Ill. Case No. 09-31460.) Richard H. Fimoff, Esq. at Robbins, Salomon & Patt Ltd. represents the Debtor in its restructuring effort. The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. In its petition, the Debtor listed $50,000,001 to $100,000,000 in assets and $10,000,001 to $50,000,000 in debts. RENAISSANCE RESIDENTIAL: Selects Robbins Salomon as Attorney ------------------------------------------------------------ Renaissance Residential of Countryside LLC asks the U.S. Bankruptcy Court for the Northern District of Illinois for permission to employ Robbins, Salomon and Patt Ltd. as its attorney. The firm has agreed to, among other things: a) advise the Debtor with respect to its powers and duties as debtor-in-possession in the continued management and operations of its business and properties; b) meet and negotiate with representative of creditors and other parties in interest; and c) advise and consult on the conduct of the case including all of the legal and administrative requirements of operating in a Chapter 11. The firm will bill the estates based on its standard hourly rates: Partners $300-$450 Associates $140-$270 Paralegals $105-$155 The Debtor assures the Court that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Based in Palatine, Illinois, Renaissance Residential of Countryside LLC filed for Chapter 11 protection on Aug. 26, 2009 (Bankr. N.D. Ill. Case No. 09-31460). Richard H. Fimoff, Esq., Robbins, Salomon & Patt Ltd., represents the Debtor in its restructuring efforts. In its petition, the Debtor listed assets between $50 million and $100 million, and debt between $10 million and $50 million. RICHARD LACK: Meeting of Creditors Scheduled for September 14 ------------------------------------------------------------- The U.S. Trustee for Region 17 will convene a meeting of creditors in Richard John Lack's Chapter 11 case on Sept. 14, 2009, at 11:00 a.m. The meeting will be held at the Office of the U.S. Trustee, 1301 Clay Street, Suite 680 N. Oakland, California. 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. Alamo, California-based Richard John Lack filed for Chapter 11 on Aug. 22, 2009 (Bankr. N.D. Calif. Case No. 09-47791). Marc Voisenat, Esq., at the Law Offices of Marc Voisenat, represents the Debtor in his restructuring effort. In his petition, the Debtor listed $10,000,000 to $50,000,000 in assets and $1,000,000 to $10,000,000 in debts. RICHARD LACK: Wants Schedules Filing Extended Until September 24 ---------------------------------------------------------------- Richard John Lack asks the U.S. Bankruptcy Court for the Northern District of California to extend until Sept. 24, 2009, the time to file his schedules of assets and liabilities and statement of financial affairs. Alamo, California-based Richard John Lack filed for Chapter 11 on Aug. 22, 2009 (Bankr. N.D. Calif. Case No. 09-47791). Marc Voisenat, Esq., at the Law Offices of Marc Voisenat, represents the Debtor in his restructuring effort. In his petition, the Debtor listed $10,000,000 to $50,000,000 in assets and $1,000,000 to $10,000,000 in debts. RICHARD LACK: Wants to Hire Voisenat Law Office as Counsel ---------------------------------------------------------- Richard John Lack asks the U.S. Bankruptcy Court for the Northern District of California for authority to employ Law Offices of Marc Voisenat as his general counsel to assist him in preparing and filing a plan of reorganization and disclosure statement. The Debtor agreed to pay $300 per hour for the services of Marc Voisenat, Esq. To the best of Debtor's knowledge, Mr. Voisenat does not hold or represent an interest adverse to this estate and does not have any connections with the debtors, creditors, or any other party in interest in this case. Based in Alamo, California, Richard John Lack filed for Chapter 11 protection on Aug. 22, 2009 (Bankr. N.D. Calif. Case No. 09-47791). In his petition, the Debtor posted assets between $10 million and $50 million, and debts between $1 million and $10 million. ROAN VALLEY LLC: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Roan Valley, LLC 900 Westpark Dr., Suite 300 Peachtree City, GA 30269 Case No.: 09-13229 Type of Business: The Debtor operates a real estate business. Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Northern District of Georgia (Newnan) Debtor's Counsel: Jimmy C. Luke II, Esq. Foltz Martin, LLC Suite 750, 5 Piedmont Center Atlanta, GA 30305 Tel: (404) 231-9397 Fax: (404) 237-1659 Email: jluke@foltzmartin.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Ronald Williamson, the company's manager. Debtor's List of 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Group VI Management, LLC Loan $1,382,956 900 Westpark Drive, Suite 300 Peachtree City, GA 30269 Dogwood Assisted Living, LLC Loan $534,456 900 Westpark Drive, Suite 300 Peachtree City, GA 30269 Group VI Services, Inc. Loan $498,246 900 Westpark Drive, Suite 300 Peachtree City, GA 30269 Group VI Construction, LLC General $376,678 900 Westpark Drive, Suite 300 contractor claim Peachtree City, GA 30269 Foley Design Associates Design services $249,592 Architects, Inc. Tennessee Department Taxes $61,283 of Revenue Johnson County Trustee Taxes $60,001 PTC Aviation, LLC $27,987 CCMR Limited Partnership Loan $18,266 Carmel & Carmel, PC Legal services $12,920 Frazier & Deeter Tax services $12,559 Precision Printing Group Trade debt $10,230 Charles L. Bretz $9,000 AIS Computers Computer/IT services $8,659 Lamar $8,350 Liquid Advertising Advertising $7,500 Carolina Property Management $4,500 The Autopilot Magazine $4,500 IAMG, LLC $3,600 dba WorldGolf.com AT&T Advertising & Publishing $2,699 SHERIDAN APARTMENTS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Sheridan Apartments, LLC 8445 Springtree Drive Sunrise, FL 33351 Bankruptcy Case No.: 09-28965 Chapter 11 Petition Date: September 8, 2009 Court: United States Bankruptcy Court Southern District of Florida (Fort Lauderdale) Judge: John K. Olson Debtor's Counsel: Ronald G. Neiwirth, Esq. 1395 Brickell Ave 14 Fl. Miami, FL 33131 Tel: (305) 789-9200 Email: rgn@fowler-white.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $0, and total debts of $6,314,784. A full-text copy of the Debtor's petition, including a list of its 20 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flsb09-28965.pdf The petition was signed by Constantin Ardelean, managing member of the Company. SHERMAG INC: Creditors Accept Plan of Arrangement ------------------------------------------------- Shermag Inc. and its subsidiaries said its plan of arrangement has been duly accepted by its creditors during a meeting of creditors held September 10 in conformity with the Companies' Creditors Arrangement Act. The Plan provides that, pursuant to a transaction to take place no later than October 16, 2009, approved by the Quebec Superior Court on August 12, 2009, le Groupe Bermex Inc., will, in furtherance to the approval of the Plan by the creditors and by the Court, invest the settlement amount of $1,250,000. On September 15, 2009, the Company will present a motion to sanction the Plan before the Quebec Superior Court. This is a very important step for the reorganization of the Company. Shermag has been operating under the protection of the CCAA since May 5, 2008 and obtained from the Quebec Superior Court an extension of the stay of proceedings against Shermag and its subsidiaries until October 16, 2009. RSM Richter Inc. is the Court appointed Monitor for the CCAA proceedings. Shermag Inc. (TSX:SMG), headquartered in Sherbrooke, Quebec, designs, produces, markets and distributes high-quality residential furniture. Shermag presently has 219 active employees and is a manufacturer and importer with its manufacturing operations and global sourcing division. SKINNY NUTRITIONAL: Posts $1.2MM Net Loss in Qtr. Ended June 30 --------------------------------------------------------------- Skinny Nutritional Corp. posted a net loss of $1,257,893 for three months ended June 30, 2009, compared with a net loss of $606,985 for the same period in 2008. For six months ended June 30, 2009, the Company posted a net loss of $2,105,720 compared with a net loss of $1,001,966 for the same period in 2008. At June 30, 2009, the Company's balance sheet showed total assets of $1,862,928, total liabilities of $1,098,016 and stockholders' equity of $764,912. The Company said there is substantial doubt about its ability to continue as a going concern. The Company noted that it has incurred losses since its inception and has not yet been successful in establishing profitable operations. In this regard, the management is proposing to raise any necessary additional funds through sales of its common stock or through loans from shareholders. Based on its current levels of expenditures and its business plan, the Company believes that its existing cash and cash equivalents will only be sufficient to fund its anticipated levels of operations for a period of less than twelve months and that without raising additional capital, the Company will be limited in it's projected growth. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?448c About Skinny Nutritional Corp. Headquartered in Bala Cynwyd, Pennsylvania, Skinny Nutritional Corp. is the exclusive worldwide distributor of Skinny Water(R), a zero-calorie, zero-sugar, zero-sodium and zero-preservative multi- functional water that helps aid in weight loss. SMURFIT-STONE: Given Plan Exclusivity Until Jan. 21 --------------------------------------------------- Smurfit-Stone Container Corp. and its affiliates obtained an extension of their exclusive period to file a Chapter 11 plan until January 21, 2010, and the period to solicit acceptances thereof until March 23, 2010. In the Company's request for an extension, James F. Conlan, Esq., at Sidley Austin LLP, in Chicago, Illinois, said that the Debtors have focused substantial time and effort to stabilize their operations in a very difficult and uncertain economic environment while also ensuring a smooth transition into Chapter 11, which includes obtaining final approval of the DIP Facility. Mr. Conlan further noted that the Debtors have also spent considerable time and extensive resources coordinating with their affiliates in Canada regarding CCAA proceedings and the implementation of a cross-border insolvency protocol. "The Debtors have not been dilatory in these cases. Rather, the Debtors have worked expeditiously to address critical issues and move these cases forward," Mr. Conlan said. He noted that the Debtors have substantially completed developing a long-term operational plan, which has already been shared with the advisors of the Official Committee of Unsecured Creditors and will be shared with the entire Committee on September 14, 2009. The Operational Plan, along with tax, pension and other considerations, will form the basis for discussions regarding the Debtors' plan of reorganization. Additionally, with the claims bar date coming in the immediate future, the Debtors will actively undertake their claims reconciliation process, which will provide an important stepping stone to the development of a Plan, Mr. Conlan told the Court. He pointed out that an extension of the current Exclusivity Periods will allow the reconciliation process to continue in an orderly fashion. Courts considering whether to extend a debtor's exclusive periods may also assess whether the debtor is paying its debts when they come due. Mr. Conlan tells the Court that together with funds on hand as of the Petition Date, funds generated through the Debtors' regular business operations and the $750 million DIP Facility, the Debtors have sufficient liquidity to pay, and are paying, their undisputed postpetition obligations as the debts come due. As of June 30, 2009, the Debtors had approximately $584.4 million in cash on hand and the Debtors believe they will have sufficient cash to fund their Chapter 11 cases. Mr. Conlan asserted that the Debtors are not seeking the extension to delay administration of the Chapter 11 cases or to exert pressure on their creditors but to maintain a framework conducive to an orderly, efficient and cost-effective restructuring process. He notes that the Debtors' Chapter 11 cases have been pending for just seven months and the Debtors have accomplished a substantial amount in a relatively short period of time. In light of the relatively short duration and complexity of the Chapter 11 Cases and the progress that the Debtors have made, the Debtors submit that an extension of the Current Exclusive Periods is warranted. Mr. Conlan pointed out that if the Court were to deny the Debtors' request, any party-in-interest would be free to propose a plan of reorganization for each of the Debtors, denying the Debtors a fair opportunity to formulate and negotiate a confirmable plan of reorganization. He argued that the result would not advance the rehabilitative objectives of the Chapter 11 process and would be destabilizing, potentially fostering a chaotic environment at the very time the Debtors are focusing their efforts on a successful reorganization of their businesses. About Smurfit-Stone Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard and paper-based packaging in North America and one of the world's largest paper recyclers. The Company operates 162 manufacturing facilities that are primarily located in the United States and Canada. The Company also owns roughly one million acres of timberland in Canada and operates wood harvesting facilities in Canada and the United States. The Company employs approximately 21,250 employees, 17,400 of which are based in the United States. For the quarterly period ended September 30, 2008, the Company reported approximately $7.450 billion in total assets and $5.582 billion in total liabilities on a consolidated basis. Smurfit-Stone and its U.S. and Canadian subsidiaries filed for Chapter 11 protection on January 26, 2009 (Bankr. D. Del. Lead Case No. 09-10235). Certain of the company's affiliates, including Smurfit-Stone Container Canada Inc., a wholly owned subsidiary of SSCE, and certain of its affiliates, filed to reorganize under the Companies' Creditors Arrangement Act in the Ontario Superior Court of Justice in Canada. Smurfit-Stone joined pulp- and paper-related bankruptcies as rising Internet use hurts magazines and newspapers. Corporacion Durango SAB, Mexico's largest papermaker, sought U.S. bankruptcy in October. Quebecor World Inc., a magazine printer and Pope & Talbot Inc., a pulp-mill operator, also sought cross-border bankruptcies for their operations in the U.S. and Canada. James F. Conlan, Esq., Matthew A. Clemente, Esq., Dennis M. Twomey, Esq., and Bojan Guzina, Esq., at Sidley Austin LLP, in Chicago, Illinois; and Robert S. Brady, Esq., and Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor in Wilmington, Delaware, serve as the Debtors' bankruptcy counsel. PricewaterhouseCooper LLC, serves as the Debtors' financial and investment consultants. Lazard Freres & Co. LLC acts as the Debtors' investment bankers. Epiq Bankruptcy Solutions LLC acts as the Debtors' notice and claims agent. Bankruptcy Creditors' Service, Inc., publishes Smurfit-Stone Bankruptcy News. The newsletter tracks the Chapter 11 proceeding and ancillary foreign proceedings undertaken by Smurfit-Stone Container Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) STAMFORD CENTER: Wins Approval of Plan, Sees Emergence in Weeks --------------------------------------------------------------- The Stamford Center for the Arts' Plan of Arrangement was officially accepted to move the organization forward and rebuild as a more financially sound performing community arts center. The U.S. Bankruptcy Court for the District of Connecticut confirmed the Plan of Reorganization of The Stamford Center for the Arts, Inc. (SCA), allowing the Company to emerge from Chapter 11 in the next several weeks. Stamford Center for the Arts Chairman Michael Widland said, "The SCA is once again poised to serve as a leading cultural arts center for Stamford, Fairfield County and beyond. This is a very important day and a giant step forward in the rebirth of SCA. Now that the financial elements are in place we welcome this opportunity as we rebuild for the future of arts in this community." Under the Plan, which was approved with the unanimous support of all of its creditors, the SCA will emerge from bankruptcy protection with all of its financial obligations satisfied, with sufficient state and private funding to support its on-going operations, and with the full support and cooperation of its creditors, the State of Connecticut, the City of Stamford, and the arts community in general. Headquartered in Stamford, Connecticut, Stamford Center for the Arts Inc. fkn Stamford Theatre Partnership -- http://www.stamfordcenterforthearts.org/-- was created by Champion International Corp., Pitney Bowes Inc. and F.D. Rich Company Inc. The Debtor filed for bankruptcy protection on Aug. 22, 2008 (Bankr. D.C. Case No.: 08-50773). Patrick J. McHugh, Esq., at Finn Dixon and Herling is the Debtor's counsel. When the Debtor filed for bankruptcy, it listed assets of $10,000,000 to $50,000,000 and debts of $1,000,000 to $10,000,000. STANDARD PACIFIC: Moody's Assigns 'Caa1' Rating on $200 Mil. Notes ------------------------------------------------------------------ Moody's Investors Service assigned a Caa1 rating to the proposed $200 million senior unsecured note offering of Standard Pacific Corp., proceeds of which will be used to repurchase certain outstanding notes of the company through tender offers, with the balance, if any, used to repay other indebtedness. At the same time, Moody's affirmed the company's existing ratings, including its corporate family rating and probability of default rating at Caa1, the ratings on its existing senior unsecured notes at Caa1, and the ratings on its senior subordinated notes at Caa3. Standard Pacific's speculative grade liquidity rating was affirmed at SGL-3. The rating outlook remains negative. The Caa1 corporate family rating reflects Moody's expectation that Standard Pacific's cash flow performance will weaken during the remainder of 2009 and be followed by an even weaker 2010, as the benefits of inventory liquidation play themselves out. In addition, the company continues to face the additional challenge of having to collapse certain of its joint ventures and bring onto its books both the land and the debt of these joint ventures, although this pressure appears to be abating. Standard Pacific also faces debt maturities for each of the next seven years, although the contemplated tender offers, if successful, may help mitigate some of the immediate pressure. The ratings further consider that while the company's revenue run rate has deteriorated by about 65% since 2005 and net worth by even more, total homebuilding debt has fallen by far less over this time period, thus driving adjusted debt leverage to approximately 80%. Moody's anticipates that the company's thin stockholders' equity balance of $348.6 million will be further reduced by continuing impairment charges during the year. At the same time, the ratings acknowledge Standard Pacific's performance in its second quarter that ended June 30, 2009, during which it generated a modest profit before charges (making it one of less than a handful of homebuilders to achieve this), reduced inventories, and continued to reduce its joint venture exposure. In addition, the ratings are supported by the company's unrestricted current cash position of nearly $570 million and absence of any material covenant compliance requirements in its recently amended bank credit agreement. The negative rating outlook reflects risks associated with general economic weakness that may continue to hamper new household creation and new home purchases, industry-wide lack of pricing power, and large inventory of unsold homes, including foreclosures in most markets. Going forward, the ratings could be lowered if the company were to deplete its cash reserves either through sharper-than-expected operating losses or through a sizable investment or other transaction. The outlook could stabilize if the company were to continue generating reasonably healthy free cash flow, reduce debt leverage to less than 70%, or continue to generate and grow its pre-impairment earnings. These rating actions were taken: * Caa1 (LGD4, 52%) assigned to the proposed $200 million senior unsecured notes due 2016; * Corporate family rating affirmed at Caa1; * Probability of default rating affirmed at Caa1; * Senior unsecured notes ratings changed to Caa1 (LGD4, 52%) from Caa1 (LGD4, 51%); * Senior subordinated notes ratings affirmed at Caa3 (LGD6, 95%); * Speculative grade liquidity affirmed at SGL-3. All of Standard Pacific's debt is guaranteed by its principal operating subsidiaries. Headquartered in Irvine, California and begun in 1966, Standard Pacific Corp. constructs and sells single-family attached and detached homes, with homebuilding operations located in California, Texas, Arizona, Colorado, Florida, North and South Carolina, and Nevada. Homebuilding revenues and consolidated net income for the trailing twelve months ended June 30, 2009 were approximately $1.3 billion and ($793) million, respectively. STANFORD GROUP: Former Director Indicted for Obstructing Probe -------------------------------------------------------------- Thomas Raffanello, a former global director of security at the Fort Lauderdale, Fla., office of Stanford Financial Group (SFG), has been charged September 10 in a three-count superseding indictment with conspiracy to obstruct a U.S. Securities and Exchange Commission (SEC) proceeding and to destroy documents in a federal investigation; obstruction of a proceeding before the SEC; and destruction of records in a federal investigation. The initial indictment in the case was unsealed by the U.S. District Court for the Southern District of Florida on June 19, 2009, and charged Bruce Perraud, 42, of Weston, Fla., a former global security specialist at the Fort Lauderdale SFG office, with one count of destruction of records in a federal investigation. In addition to charging Raffanello, 61, of Coral Gables, Fla., today's superseding indictment charges Perraud with an additional count of conspiracy as well as one count of obstruction of a proceeding before the SEC. Raffanello and Perraud are scheduled to make their initial appearances at the U.S. District Court in Fort Lauderdale at 11 a.m. ET on Friday, Sept. 11, 2009. According to court documents, SFG, headquartered in Houston, was the parent company of numerous affiliated financial services entities, including the Stanford International Bank Ltd. (SIBL). According to the superseding indictment, SIBL, an offshore SFG bank affiliate located in St. John's, Antigua, allegedly lured U.S. investors to buy into its certificates of deposit (CDs) by touting high investment returns not available through domestic banks. SIBL is alleged to have misrepresented that it held $8 billion in client funds that had been invested primarily in its CDs. The SEC filed a complaint in the U.S. District Court for the Northern District of Texas against SIBL and its affiliated entities on Feb. 16, 2009, in which it alleged that the SIBL CD program was the mechanism by which the principals of SIBL orchestrated a "massive, ongoing fraud." Also on Feb. 16, 2009, a receiver was appointed to assume exclusive control of all SFG-related entities in order to protect SIBL assets from potential waste and depletion by SIBL's principals. The U.S. District Court for the Northern District of Texas additionally issued an order instructing that all SFG and SIBL employees preserve all company documents and records, protecting them from destruction. The indictment alleges that the receiver sent an e-mail on Feb. 17, 2009, to all SFG employees describing the contents of the court order mandating document and record preservation. It is alleged that the e-mail further instructed SFG employees that they had been ordered to preserve "any and all documents, notes and records," and that they may not "hide, destroy or alter any document or electronic record relating to the company." According to the allegations in the superseding indictment, Perraud placed a telephone call to Raffanello on Feb. 17, 2009, in which he discussed the court order mandating the preservation of documents. Six days later, on Feb. 23, 2009, the indictment alleges Raffanello directed that the documents housed at SFG's Fort Lauderdale office be shredded. Perraud allegedly contacted a commercial shredding company on that same day and requested that it destroy a large quantity of SFG documents at the Fort Lauderdale office, in violation of the Feb. 16 court order. The indictment alleges that a representative of the commercial shredding company arrived at SFG's Fort Lauderdale offices on Feb. 25, 2009, where he was met by Perraud. Perraud then allegedly supervised as a 95-gallon bin was packed with documents and was hauled to the shredder's vehicle, where its contents were shredded. The indictment also alleges that many more documents and records were brought to the shredding truck for destruction. In a related case, SFG corporate officers Robert Allen Stanford, Laura Pendergest-Holt, Gilberto Lopez and Mark Kuhrt, as well as Leroy King, a former Antiguan bank regulator, were each charged in an indictment unsealed on June 19, 2009, in the Southern District of Texas with conspiracy to commit mail, wire and securities fraud; wire fraud; mail fraud; and conspiracy to commit money laundering stemming from an alleged massive investment fraud scheme involving CDs held by SIBL. Stanford, Pendergest-Holt and King were also charged with conspiracy to obstruct an SEC investigation and obstruction of an SEC investigation. In another related case, James Davis, SFG's former chief financial officer, pleaded guilty on Aug. 27, 2009, in the Southern District of Texas to conspiracy to commit mail, wire and securities fraud; mail fraud; and conspiracy to obstruct a proceeding of the SEC. Davis was initially charged in a criminal information filed with the court on June 18, 2009. The case is being investigated by the FBI's Houston Field Office and the U.S. Postal Inspection Service. It is being prosecuted by Fraud Section Senior Litigation Counsel Jack Patrick and Trial Attorney Matthew Klecka of the Criminal Division's Fraud Section. About Stanford Group Stanford companies operated by selling certificates of deposit in more than 100 discrete locations spanning 15 states in the United States and 13 countries in Europe, the Caribbean, Canada and Latin America. Stanford claimed to have more than 30,000 clients located in 133 countries. Domiciled in Antigua, Stanford International Bank Limited -- http://www.stanfordinternationalbank.com/-- is a member of Stanford Private Wealth Management, a global financial services network with US$51 billion in deposits and assets under management or advisement. Stanford Private Wealth Management serves more than 70,000 clients in 140 countries. On February 16, 2009, the United States District Court for the Northern District of Texas, Dallas Division, signed an order appointing Ralph Janvey as receiver for all the assets and records of Stanford International Bank, Ltd., Stanford Group Company, Stanford Capital Management, LLC, Robert Allen Stanford, James M. Davis and Laura Pendergest-Holt and of all entities they own or control. The U.S. Securities and Exchange Commission, on Feb. 17, charged before the U.S. District Court in Dallas, Texas, Mr. Stanford and three of his companies for orchestrating a fraudulent, multi- billion dollar investment scheme centering on an US$8 billion Certificate of Deposit program. A criminal case was pursued against him in June before the U.S. District Court in Houston, Texas. Mr. Stanford pleaded not guilty to 21 charges of multi-billion dollar fraud, money-laundering and obstruction of justice. Assistant Attorney General Lanny Breuer, as cited by Agence France-Presse News, said in a 57-page indictment that Mr. Stanford could face up to 250 years in prison if convicted on all charges. Mr. Stanford surrendered to U.S. authorities after a warrant was issued for his arrest on the criminal charges. The criminal case is U.S. v. Stanford, H-09-342, U.S. District Court, Southern District of Texas (Houston). The civil case is SEC v. Stanford International Bank, 3:09-cv-00298-N, U.S. District Court, Northern District of Texas (Dallas). See http://www.usdoj.gov/criminal/vns SUN-TIMES MEDIA: Sale to Tyree Needs Paycuts for Non-union Workers ------------------------------------------------------------------ Sun-Times Media Group CEO Jeremy Halbreich said that non-union employees will get pay cuts. According to The Associated Press, Mr. Halberich said that non-union workers making between $25,000 and $100,000 will take an 8% pay cut, while those making over $100,000 will have their pay reduced by 11%. Mr. Halbreich said that the advertising sales staff is exempted because their pay has already fallen significantly, The AP states. According to The AP, Sun-Times Media spokesperson Tammy Chase said that the pay cuts will affect 1,270 of the Company's 1,900 employees. The AP notes that union members are likely to feel the cost cutting as well, as Mr. Chase said that Sun-Times Media is handing a list of concessions STMG Holdings -- the stalking horse bidder for Sun-Times Media's assets -- wants from the Company's 18 unions. Without the concessions, STMG Holdings will withdraw from the deal, says the report. As reported by the Troubled Company Reporter on September 9, 2009, Sun-Times Media Group said it has entered into a "stalking horse" asset purchase agreement with STMG Holdings, LLC, a private investor group led by Chicago businessman James C. Tyree, for substantially all assets of Sun-Times Media Group. The buyer will acquire substantially all assets of the Company for $5 million in cash, subject to a working capital adjustment, and will assume certain liabilities of Sun-Times Media Group estimated to total approximately $20 million. Sun-Times says that, after five months of marketing efforts by Rothschild Inc., only James C. Tyree-led STMG Holdings submitted an offer to purchase assets on a going concern basis. About Sun-Times Media Sun-Times Media Group, Inc. -- http://www.thesuntimesgroup.com/-- (Pink Sheets: SUTM) owns media properties including the Chicago Sun-Times and Suntimes.com as well as newspapers and Web sites serving more than 200 communities across Chicago. The Company and its affiliates conduct business as a single operating segment which is concentrated in the publishing, printing, and distribution of newspapers in greater Chicago, Illinois, metropolitan area and the operation of various related Web sites. The Company also has affiliates in Canada, the United Kingdom, and Burma. Sun-Times Media's balance sheet at September 30, 2008, showed total assets of $479.9 million, total liabilities of $801.7 million, resulting in a stockholders' deficit of roughly $321.8 million. The Company and its affiliates filed for Chapter 11 bankruptcy protection on March 31, 2009 (Bankr. D. Del. Case No. 09-11092). James H.M. Sprayregan, P.C., James A. Stempel, Esq., David A. Agay, Esq., and Sarah H. Seewer, Esq., at Kirkland & Ellis LLP, assist the Debtors in their restructuring efforts. Kurtzman Carson Consultants LLC is the Debtors' claims agent. As of November 7, 2008, the Debtors listed $479,000,000 in assets and $801,000,000 in debts. SUNRISE SENIOR: SCA Lenders Extend Loan Maturity, Relax Covenants ----------------------------------------------------------------- Sunrise Connecticut Avenue Assisted Living L.L.C., a subsidiary of Sunrise Senior Living, Inc., which owns and operates Sunrise's Connecticut Avenue property, on September 1, 2009, entered into amendments to: (i) two Loan Agreements, dated as of August 28, 2007, by and among SCA and Chevy Chase Bank, a division of Capital One, N.A., as agent for the lenders party thereto; and (ii) certain notes executed in connection with the entry into the Loan Agreements. The Amendments, among other matters, (i) extended the maturity date of the Loan Documents from August 28, 2009, to December 2, 2009, (ii) suspended the measurement of certain financial and operating covenants through the Extended Maturity Date, (iii) included waivers with respect to certain defaults under certain operating covenants, and (iv) provided for certain additional financial reporting requirements. Additionally, the Amendments increased the interest rates applicable to (i) $29.6 million of outstanding borrowings under one of the Loan Agreements to one- month LIBOR plus 5.00% per annum and (ii) $10.0 million of outstanding borrowings under the second of the Loan Agreements to one-month LIBOR plus 5.50% per annum. Pursuant to the Amendments, SCA will pay Chevy Chase, for the benefit of the lenders, a $50,000 one-time amendment fee. SCA's projections indicate that SCA will generate sufficient internal funds from the operation of the Connecticut Avenue property to pay all interest and fees through the Extended Maturity Date. SCA's obligations under the Loan Documents are secured by a mortgage on the real property owned by SCA and located in Washington, DC and are guaranteed by Sunrise. Bankruptcy Warning Sunrise Senior Living said it has no borrowing availability under its bank credit facility, and it has significant scheduled debt maturities in 2009 and significant long-term debt that is in default. Sunrise is endeavoring to extend debt maturity dates, re-finance debt and obtain waivers from applicable lenders. It is engaged in discussions with various venture partners and third parties regarding the sale of certain assets with the purpose of increasing liquidity and reducing obligations to enable the Company to continue operations. Sunrise expects that its cash balances and expected cash flow are sufficient to enable it to meet operating obligations through December 2, 2009. If it is not able to achieve these objectives, it will not have sufficient financial resources to meet financial obligations and it could be forced to seek reorganization under the U.S. Bankruptcy Code. On April 28, 2009, Sunrise Senior Living entered into a Twelfth Amendment to the Bank Credit Facility. The significant terms include waiver of all existing financial covenants through December 2, 2009, the maturity date of the Bank Credit Facility; requirement to maintain minimum cash balance as of the last day of each month and of not less than $5 million at any time; a cash sweep as of the last day of October and November 2009 to reduce principal equal to the greater of consolidated cash in excess of $35 million or $2 million; and a permanent reduction of the commitment after an agreed-upon repayment of the outstanding balance from dispositions consented to by our lenders, federal income tax refunds of $20.8 million and payments received from the cash sweep. As of June 30, 2009, the Company had $1.14 billion in total assets and $1.09 billion in total liabilities. Sunrise had $37.0 million and $29.5 million of unrestricted cash at June 30, 2009 and December 31, 2008, respectively. As of June 30, 2009, Sunrise and its consolidated subsidiaries had debt of $614.5 million, of which $99.1 million of debt is scheduled to mature in 2009, along with $69.2 million of draws on the Bank Credit Facility. Long-term debt that is in default totals $360.4 million, including $190.2 million of debt that is in default as a result of the failure to pay principal and interest to the lenders of Sunrise's German communities, and $170.2 million of debt that is in default as a result of Sunrise's failure to meet certain financial covenants. About Sunrise Senior Living Sunrise Senior Living, Inc., a McLean, Va.-based company -- http://www.sunriseseniorliving.com/-- employs roughly 40,000 people. As of June 30, 2009, Sunrise operated 415 communities in the United States, Canada, Germany and the United Kingdom, with a combined unit capacity of roughly 42,750 units. Sunrise offers a full range of personalized senior living services, including independent living, assisted living, care for individuals with Alzheimer's and other forms of memory loss, as well as nursing and rehabilitative services. Sunrise's senior living services are delivered by staff trained to encourage the independence, preserve the dignity, enable freedom of choice and protect the privacy of residents. T.J. GIESEKER TRUCKING: Case Summary & Largest Unsecured Creditor ----------------------------------------------------------------- Debtor: T.J. Gieseker Trucking, LLC 35424 Audrain Road 708 Martinsburg, MO 65264 Bankruptcy Case No.: 09-20463 Chapter 11 Petition Date: September 8, 2009 Court: United States Bankruptcy Court Eastern District of Missouri (Hannibal) Debtor's Counsel: Spencer P. Desai, Esq. Capes, Sokol, Goodman and Sarachan, P.C. Pierre Laclede Center 7701 Forsyth Boulevard, 12th Floor St. Louis, MO 63105 Tel: (314) 721-7701 Fax: (314) 721-0554 Email: desai@capessokol.com Estimated Assets: $0 to $50,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor identified Missouri Deparment of Agriculture with a disputed debt claim for $4,835,000 as its largest unsecured creditor. A full-text copy of the Debtor's petition, including a list of its largest unsecured creditor, is available for free at: http://bankrupt.com/misc/moeb09-20463.pdf The petition was signed by Cathy Gieseker. TAHOE FRIDAY: U.S. Trustee Sets Meeting of Creditors for October 5 ------------------------------------------------------------------ The U.S. Trustee for Region 17 will convene a meeting of creditors in Tahoe Friday, LLC's Chapter 11 case on Oct. 5, 2009, at 1:00 p.m. The meeting will be held at 300 Booth Street, Room 2110, Reno, Nevada. 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 Carson City, Nevada, Tahoe Friday, LLC, operates a real estate business. The Company filed for Chapter 11 on Aug. 26, 2009, (Bankr. D. Nev. Case No. 09-52910). Nick A. Moschetti Jr., Esq., represents the Debtor in its restructuring effort. In its petition, the Debtor listed total assets of $12,225,000 and total debts of $5,261,381. TAMPA ENCLAVE: Case Summary & 3 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Tampa Enclave 52 LLC dba The Promenade at Tampa Palms 7200 W. Camino Real Road, Suite 302 Boca Raton, FL 33433 Case No.: 09-15441 Type of Business: The Debtor operates a real estate business. Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Allan L. Gropper Debtor's Counsel: Kevin J. Nash, Esq. Goldberg Weprin Finkel Goldstein LLP 1501 Broadway, 22nd Floor New York, NY 10036 Tel: (212)-301-6944 Fax: (212) 422-6836 Email: KJNash@Finkgold.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Jacob Sabo. Debtor's List of 3 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ HotWire Corporation $33,718 Premium Assignment Corporation $10,314 Wilmar Industries Inc. $2,614 TAVERN ON THE GREEN: Files Chapter 11 After Losing Lease -------------------------------------------------------- Tavern on the Green LP filed for Chapter 11 in Manhattan after it lost its lease for its restaurant in New York's Central Park to a higher bidder. According to Bloomberg News, the restaurant's name, valued at $19 million and in place since its founding by Parks Commissioner Robert Moses in 1934, now will be sold to the highest bidder in bankruptcy court, according to Keith Costa, a lawyer for the bankrupt partnership. Bloomberg relates that the lease for Tavern on the Green, the second-highest-grossing restaurant in the U.S. last year, had been held since 1974 by the family of Warner LeRoy, which owns the Tavern on the Green name. The city last month, according to Bloomberg, awarded the lease for 20 years starting at the end of Dec. 31 to restaurateur Dean Poll, who runs the Central Park Boathouse Restaurant. Tavern on the Green LP is the operator of the 75-year-old restaurant in New York's Central Park. The Company filed for Chapter 11 on September 9, 2009 (Bankr. S.D.N.Y. Case No. 09- 15450). It listed assets and debts of as much as $50 million each. TALECRIS BIOTHERAPEUTICS: Moody's Upgrades Corp. Rating to 'B2' --------------------------------------------------------------- Moody's Investors Service upgraded the ratings of Talecris Biotherapeutics, Inc. (Corporate Family Rating to B2 from B3) and changed the outlook to positive. The rating upgrade reflects better than expected operating performance aided largely by improved plasma supply and strong Gamunex sales. The B2 rating also considers better covenant cushions because of higher EBITDA and slightly lower debt levels. Although Talecris should be able to comply with its covenants over the next several quarters, ongoing quarterly step-down provisions provide some risk. That said, Moody's assignment of a positive outlook considers the company's planned IPO transaction that could result in significant debt reduction. Diana Lee, a Senior Credit Officer at Moody's said, "If Talecris is able to achieve and sustain lower debt levels and comfortable covenant cushions, further rating improvement is possible." However, in order to support higher capital spending needs associated with manufacturing facilities, the company will need to see improvements in operating cash flow and address existing constraints on its capital spending levels as dictated by terms under its current bank agreements. The last credit action for Talecris occurred on December 2, 2008, when the company's Corporate Family Rating was upgraded to B3 from Caa1. Ratings upgraded with a positive outlook: Talecris Biotherapeutics, Inc. * Corporate Family Rating to B2 from B3 * First lien term loan to B1, LGD3, 38% from B2, LGD3, 38% * Second lien term loan to Caa1, LGD5, 89% from Caa2, LGD5, 89% * PDR to B2 from B3 Talecris Biotherapeutics, Inc., is a leading global manufacturer of plasma-derived, protein-based products for individuals suffering from life-threatening diseases. Talecris began operations on April 1, 2005, when the U.S. assets of Bayer AG's worldwide plasma derived products business were acquired by financial sponsors, Cerberus Capital Management and Ampersand Ventures. TERRY GRAY: Case Summary & Largest Unsecured Creditor ----------------------------------------------------- Debtor: Terry D. Gray 309 W. 118th Street, #1A New York, NY 10026 Bankruptcy Case No.: 09-15434 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Judge: Stuart M. Bernstein Debtor's Counsel: Peter F. Anderson, Esq. Law Offices of Peter F Anderson 370 East 149th Street, Suite C 10455 Bronx, NY 10455 Tel: (718) 993-2336 Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor identified Flagstar Bank with an unliquidated debt claim for $298,360 as its largest unsecured creditor. A full-text copy of the Debtor's petition, including a list of its largest unsecured creditor, is available for free at: http://bankrupt.com/misc/nysb09-15434.pdf The petition was signed by Terry D. Gray. TEXANS CUSO INSURANCE: Case Summary & 11 Largest Unsec. Creditors ----------------------------------------------------------------- Debtor: Texans CUSO Insurance Group, LLC dba Heartland Specialty Insurance dba Curley Insurance Group dba Heartland Marketing Group dba CEIS Management dba KMC Insurance Services dba Construction Equipment Insurance Services dba National Construction Insurance Services dba Texans Premium Finance Group dba CEIS dba NCIS dba NCIS Management 5050 Quorum, Suite 500 Dallas, TX 75254 Case No.: 09-35981 Type of Business: The Debtor operates an insurance company. Chapter 11 Petition Date: September 5, 2009 Court: United States Bankruptcy Court Northern District of Texas (Dallas) Judge: Barbara J. Houser Debtor's Counsel: Scott Mark DeWolf, Esq. Rochelle McCullough L.L.P. 101 E. Park Blvd., Suite 951 Plano, TX 75074 Tel: (972) 735-9143 Fax: (972) 735-9780 Email: sdewolf@romclawyers.com Estimated Assets: $10,000,001 to $50,000,000 Estimated Debts: $10,000,001 to $50,000,000 The petition was signed by Mike Haselden, the company's president. Debtor's List of 11 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Budget Print Center trade debt $131 Konica Minolta trade debt $66 Lone Star Overnight trade debt $10 Muzak trade debt $119 Purchase Power trade debt $1,050 Pitney Bowes trade debt $1,072 Recall Total Information trade debt $210 Marsh Berry trade debt $1,050 EBIX, Inc. trade debt $100 Insurance Service Office trade debt $140 Cogent Communication trade debt $974 Work Flow One trade debt $974 TIMOTHY HARRISON MORGAN: Case Summary & 8 Largest Unsec. Creditors ------------------------------------------------------------------ Joint Debtors: Timothy Harrison Morgan Katherine O'connor Morgan 103 Kimberly Court Hendersonville, TN 37075 Bankruptcy Case No.: 09-10279 Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Middle District of Tennessee (Nashville) Judge: Keith M. Lundin Debtors' Counsel: Steven L. Lefkovitz, Esq. Law Offices Lefkovitz & Lefkovitz 618 Church St., Ste. 410 Nashville, TN 37219 Tel: (615) 256-8300 Fax: (615) 255-4516 Email: slefkovitz@lefkovitz.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 According to the schedules, the Company has assets of at least $1,415,746, and total debts of $1,656,530. A full-text copy of the Debtors' petition, including a list of their 8 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/tnmb09-10279.pdf The petition was signed by the Joint Debtors. TLC VISION: Obtains Credit Facility Waiver Until September 30 ------------------------------------------------------------- TLC Vision Corporation on September 10 said it has secured from its lenders holding a majority amount of its secured credit facility, an extension to September 30, 2009, of the limited waiver and forbearance with respect to its credit facility that was set to expire on September 9. The credit agreement, dated June 21, 2007, as amended, provides for a US$85 million term loan and a US$25 million revolving credit line. As of August 31, 2009, the principal amount outstanding under the credit facility was US$100.1 million. The extension and forbearance agreement is contained in an amendment to the limited waiver no. 4 and amendment no. 5 to the credit agreement, dated as of September 8, 2009, which, among other things, provides a limited waiver through September 30, 2009 of specified defaults and provides that the lenders will, until October 1, 2009, forbear from exercising their rights arising out of the non-payment of certain principal, interest and other payments previously due. The agreement also provides for the Company to negotiate in good faith and use its best efforts to agree by September 28, 2009 to (i) a term sheet reflecting terms of proposed additional financing acceptable to lenders representing a majority of the outstanding debt under the credit agreement, and (ii) a term sheet reflecting terms of a debt or equity restructuring acceptable to those lenders required to approve such debt or equity restructuring under applicable law. TLC Vision Corporation (NASDAQ:TLCV; TSX:TLC) -- http://www.tlcv.com/and http://www.lasik.com/-- is North America's premier eye care services company, providing eye doctors with the tools and technologies needed to deliver high-quality patient care. Through its centers' management, technology access service models, extensive optometric relationships, direct to consumer advertising and managed care contracting strength, TLCVision maintains leading positions in Refractive, Cataract and Eye Care markets. TOTAL SAFETY: S&P Changes Outlook of 'B-' Rating to Stable ---------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Total Safety U.S. Inc. to stable from negative. At the same time, S&P affirmed the ratings, including the 'B-' corporate credit rating, on the company. "The outlook revision reflects the fact that safety spending is nondiscretionary and S&P's view that Total Safety should continue to generate a modest amount of free cash flow from upcoming projects," said Standard & Poor's credit analyst Kenneth Cox. S&P also expect that the company would favorably amend any possible covenant violations. The ratings on Total Safety reflect the company's aggressive financial leverage and narrow business position in the fragmented market for safety equipment and maintenance services for cyclical end markets. The ratings also reflect a diversified customer base, recession-resistant demand for product and services, and low capital requirements. As of June 30, 2009, Total Safety had about $137.4 million in debt, adjusted for operating leases. Standard & Poor's Ratings Services views Total Safety's business profile as vulnerable because of its limited market share and the cyclical nature of the oil and gas industry. The company operates in three business segments: safety equipment rentals, equipment sales, and safety systems and services. The company's in-plant service centers provide full safety services for customers' facilities and are an important component of the company's growth strategy. Management has implemented a strategy of improving operational efficiencies, increasing customer outreach, and leveraging current customer relationships to diversify into new services. Financial performance has continually improved since 2004. S&P expects that Total Safety's upcoming projects should allow the company to continue to generate adequate free cash flow for the remainder of 2009. Covenants could become tight given that leverage and interest coverage requirements continue to step down in coming quarters. However, the company should have sufficient cash flow and liquidity to alleviate such concerns. S&P could revise S&P's outlook to negative if the company begins to have negative cash flow or if leverage approaches 5x or EBITDA interest coverage deteriorates to near 1.5x. A revision to a positive outlook is unlikely given limitations of the business scope and scale. TOUSA INC: Exclusivity Period Will End by Sept. 15 -------------------------------------------------- TOUSA Inc., Citicorp North America, Inc., as administrative agent under the Debtors' prepetition secured First Lien Term Loan; the First Lien Term Loan Lenders; Wells Fargo Bank, N.A., as administrative agent under the Debtors' prepetition secured Second Lien Term Loan; the Second Lien Term Loan Lenders; and the Official Committee of Unsecured Creditors have entered into a stipulation regarding the exclusive periods. The parties agree that they will not propose a Chapter 11 plan nor vote in favor of any Chapter 11 plan until after 30 days from the earlier of (i) the conclusion of the action commenced by the Committee against the Secured Lenders, or (ii) the entry of any order for the settlement or disposition of the Committee Action, but in any event no later than September 15, 2009. According to Bill Rochelle at Bloomberg, following completion of the trial lasting more than two weeks, the parties to the suit submitted their post-trial papers just before the Labor Day holiday. In the lawsuit, the Creditors Committee is contending that security interests given by subsidiaries were fraudulent transfers because the subsidiaries were made insolvent and received no benefit from the loans. Mr. Rochelle relates, the outcome of the trial will decide how much, if anything, unsecured creditors can recover under a Chapter 11 plan. TOUSA has deferred its proposed Chapter 11 plan to await the outcome of the trial. About Tousa Inc. Headquartered in Hollywood, Florida, TOUSA Inc. (Pink Sheets: TOUS) -- http://www.tousa.com/-- fka Technical Olympic U.S.A. Inc., dba Technical U.S.A., Inc., Engle Homes, Newmark Homes L.P., TOUSA Homes Inc. and Newmark Homes Corp. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. The Debtor and its debtor-affiliates filed for separate Chapter 11 protection on January 29, 2008 (Bankr. S.D. Fla. Case No. 08- 10928). The Debtors have selected M. Natasha Labovitz, Esq., Brian S. Lennon, Esq., Richard M. Cieri, Esq., and Paul M. Basta, Esq., at Kirkland & Ellis LLP; and Paul Steven Singerman, Esq., at Berger Singerman, to represent them in their restructuring efforts. Lazard Freres & Co. LLC is the Debtors' investment banker. Ernst & Young LLP is the Debtors' independent auditor and tax services provider. Kurtzman Carson Consultants LLC acts as the Debtors' Notice, Claims & Balloting Agent. TOUSA's direct subsidiary, Beacon Hill at Mountain's Edge LLC dba Eagle Homes, filed for Chapter 11 Protection on July 30, 2008 (Bankr. S.D. Fla. Case No. 08-20746). It listed assets between $1 million and $10 million, and debts between $1 million and $10 million. The Official Committee of Unsecured Creditors hired Patricia A. Redmond, Esq., and the law firm Stearns Weaver Weissler Alhadeff & Sitterson, P.A., as its local counsel. TOUSA Inc.'s balance sheet at June 30, 2008, showed total assets of $1,734,422,756 and total liabilities of $2,300,053,979. Bankruptcy Creditors' Service, Inc., publishes TOUSA Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by TOUSA Inc. and its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) TREY RESOURCES: June 30 Balance Sheet Upside-Down by $4.5 Million ----------------------------------------------------------------- Trey Resources Inc.'s balance sheet at June 30, 2009, showed total assets of $1,222,750 and total liabilities of $5,708,049, resulting in a stockholders' deficit of $4,485,299. For six months ended June 30, 2009, the Company reported a net income applicable to common shares of $569,727 compared with a net loss of $1,743,577 for the same period in the previous year. For three months ended June 30, 2009, the Company reported a net income applicable to common shares of $542,682 compared with a net loss of $1,547,826 for the same period in 2008. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4484 Headquartered in Livingston, New Jersey, Trey Resources Inc. (OTC BB: TYRIA) -- http://www.treyresources.com/-- operates as a business consultant, value-added reseller, and developer of financial accounting software to small and medium-sized businesses in the United States. It also publishes its own proprietary electronic data interchange software, MAPADOC, which is used to automate existing processes. Going Concern Doubt On March 27, 2009, Bagell, Josephs, Levine & Company, LLC, in Marlton, New Jersey, expressed substantial doubt about Trey Resources' ability to continue as a going concern after auditing the Company's financial statements for the fiscal years ended Dec. 31, 2008, and 2007. The auditor noted that the Company incurred substantial accumulated deficits and operating losses. TRIPLE CROWN: Gabelli Funds, et al., Hold 8.6% Equity Stake ----------------------------------------------------------- Mario J. Gabelli's Gabelli Funds, LLC; GAMCO Asset Management Inc.; and Teton Advisors, Inc., are the beneficial owners of 480,656 shares, representing 8.60% of the 5,591,626 shares of Triple Crown Media, Inc. Common Stock, as of August 25, 2009. About Triple Crown Headquartered in Lawrenceville, Georgia, Triple Crown Media Inc. (Nasdaq: TCMI) -- http://triplecrownmedia.com/-- owns and operates six daily newspapers and one weekly newspaper in Georgia. As of March 31, 2009, the Company had $36,431,000 in total assets; and $88,296,000 in total liabilities and $17,581,000 in Series A redeemable, convertible preferred stock; resulting in $69,446,000 in stockholders' deficit. As of December 31, 2008, the Company had negative working capital of roughly $68 million and it failed to meet certain financial loan covenants contained in its loan agreements. On January 3, 2009, subsequent to the quarter ended December 31, 2008, the Company failed to make a $1.1 million interest payment, which constitutes an additional violation of its loan covenants. As a result of not being in compliance with its loan facility covenants as of December 31, 2008, the Company classified all of its loan facility debt as a current liability to reflect the option its lenders have to call its debt at any time. "These factors raise substantial doubt as to our ability to continue as a going concern," Mark G. Meikle, executive vice president and chief financial officer, said. TRIPLE CROWN: In Talks With Lenders on Possible Restructuring ------------------------------------------------------------- Triple Crown Media, Inc., on March 31, 2009, entered into Amendment No. 5 to its Second Lien Senior Secured Credit Agreement and Note by and among Triple Crown Media, LLC, as Borrower; the Company as Parent and Guarantor; Wilmingto Trust FSB as Administrative Agent and Collateral Agent; BR Acquisition Corp., BR Holding, Inc., DataSouth Computer Corporation, Gray Publishing, LLC and Capital Sports Properties, Inc., as Guarantors; Wachovia Bank, National Association, as administrative agent for lenders party to the First Lien Facilities; and Global Leveraged Capital Credit Opportunity Fund I, GoldenTree 2004 Trust, GoldenTree Capital Solutions Fund Financing, GoldenTree Capital Solutions Offshore Fund Financing, GoldenTree Capital Opportunities, LP, GoldenTree MultiStrategy Financing, Ltd., Greyrock CDO, Ltd., Landmark III CDO Limited, Landmark IV CDO Limited, Landmark V CDO Limited, Landmark VI CDO Limited, and Landmark VII CDO Limited as Lenders. Pursuant to the Amendment to the Second Lien, the Company was required (among other things) to take certain action within 120 days after the effective date of the amendment, including without limitation, the issuance of certain warrants to the lenders under the Second Lien Credit Agreement, the execution of certain equity agreements with management, and steps necessary to result in the Company no longer being required to file periodic reports with the SEC under the Securities and Exchange Act of 1934. The Company subsequently entered into agreements with the lenders under the Second Lien Credit Agreement extending the deadline for the Company to comply with the requirements of Sections 8-10 of the Amendment to the Second Lien through August 18, 2009. On August 18, 2009, the Company entered into an agreement further extending the deadline until the earliest to occur of (i) September 8, 2009 at 6:00 p.m. (EST); (ii) the filing by the Borrower of a petition for relief under Chapter 11 of the United States Bankruptcy Code; and (iii) 24 hours after delivery to Borrower of a notice terminating the agreement by the Administrative Agent or the lenders. The extension was granted in consideration for the Company's agreement to continue its ongoing discussions with the lenders regarding strategic alternatives that may be available to the Company, including a possible capital restructuring. The Company is currently engaged in discussions with its lenders regarding a possible Restructuring and has, pursuant to this Agreement, agreed to coordinate certain matters relating to a possible Restructuring with its lenders. On September 4, 2009, the Company's deadline was further extended until the earliest to occur of (i) September 15, 2009 at noon (EST); (ii) the filing by the Borrower of a petition for relief under Chapter 11 of the United States Bankruptcy Code; and (iii) 24 hours after delivery to Borrower of a notice terminating the agreement by the Administrative Agent or the lenders. As of March 31, 2009, the Company had $36,431,000 in total assets; and $88,296,000 in total liabilities and $17,581,000 in Series A redeemable, convertible preferred stock; resulting in $69,446,000 in stockholders' deficit. About Triple Crown Headquartered in Lawrenceville, Georgia, Triple Crown Media Inc. (Nasdaq: TCMI) -- http://triplecrownmedia.com/-- owns and operates six daily newspapers and one weekly newspaper in Georgia. As of December 31, 2008, the Company had negative working capital of roughly $68 million and it failed to meet certain financial loan covenants contained in its loan agreements. On January 3, 2009, subsequent to the quarter ended December 31, 2008, the Company failed to make a $1.1 million interest payment, which constitutes an additional violation of its loan covenants. As a result of not being in compliance with its loan facility covenants as of December 31, 2008, the Company classified all of its loan facility debt as a current liability to reflect the option its lenders have to call its debt at any time. "These factors raise substantial doubt as to our ability to continue as a going concern," Mark G. Meikle, executive vice president and chief financial officer, said. TXCO RESOURCES: Lien Holders Cry Foul to Transfer of Rights ----------------------------------------------------------- An ad hoc group of mineral lien holders has objected to TXCO Resources Inc.'s proposal to transfer certain oil exploration and production rights in three Texas counties to Redemption Oil & Gas LLC, saying the proposal does not protect the lien holders' interests, according to Law360. TXCO Resources is already facing opposition on its request for an extension of its exclusive period to file a Chapter 11 plan. The official committee of unsecured creditors for TXCO contends that the second-lien term loan lenders, owed $100 million, currently have control over the plan process -- including an October deadline for a plan -- by virtue of the terms of the DIP financing they provided. The creditors committee wants exclusivity terminated so that it can pursue an alternative for the Debtor. About TXCO Resources TXCO Resources Inc. is an independent oil and gas enterprise with interests in the Maverick Basin, the onshore Gulf Coast region and the Marfa Basin of Texas, and the Midcontinent region of western Oklahoma. TXCO's business strategy is to acquire undeveloped mineral interests and internally developing a multi-year drilling inventory through the use of advanced technologies, such as 3-D seismic and horizontal drilling. It accounts for its oil and gas operations under the successful efforts method of accounting and trades its common stock on Nasdaq's Global Select Market under the symbol "TXCO." The Company and its affiliates filed for Chapter 11 protection on May 17, 2009 (Bankr. W.D. Tex. Case No. 09-51807). The Debtors hired Deborah D. Williamson, Esq., and Lindsey D. Graham, Esq., at Cox Smith Matthews Incorporated, as general restructuring counsel; Fulbright and Jaworski, L.L.P., as corporate counsel & conflicts counsel; Albert S. Conly as chief restructuring officer and FTI Consulting Inc. as financial advisor; Goldman, Sachs & Co. as financial advisor for assets sale; Global Hunter Securities, LLC, as financial advisors and investment bankers; and Administar Services Group LLC as claims agent. Gardere Wynne Sewell LLP represents the Committee. As reported in Troubled Company Reporter on July 6, 2009, in their schedules of assets and liabilities, the Debtors have $357,855,952 in total assets and $331,422,792 in total liabilities. UBS AG: Must Set Aside $35.5MM for Pursuit Partners Lawsuit ----------------------------------------------------------- Carrick Mollenkamp and Serena Ng at The Wall Street Journal reports Connecticut Court Judge John F. Blawie has ruled that UBS AG set aside $35.5 million to cover a potential judgment against it in a case involving debt securities that employees called "crap" and "vomit". The Journal relates that hedge fund Pursuit Partners LLC claims that UBS sold investment-grade debt securities to the firm in 2007, though the Company knew that the securities were about to be downgraded by ratings agencies. Judge Blawie's ruling cited UBS e-mails that showed UBS workers discussing possible Moody's rating downgrades in July 2007 before the Company sold the securities to Pursuit Partners, The Journal states. According to The Journal, Pursuit Partners agreed to invest in the debt securities between July and October 2007. The Journal says that in October, Moody's Ratings Service downgraded billions of dollars of CDOs, including those that the hedge fund bought, and a few months later, Pursuit Partners' securities defaulted and it lost its entire investment. Citing Judge Blawie, The Journal states that Pursuit Partners had "presented sufficient evidence to satisfy the probable cause standard with respect to their claim that UBS was in possession of superior knowledge that was not readily available" to the company. UBS said in a statement that the decision is "preliminary" and that it believes it would "prevail on the merits of the case." According to UBS' statement, Judge Blawie's decision was a "preliminary procedure to require defendants to post security while a case is pending, nothing more. The decision is not a decision on the merits or a prediction of the outcome of the case. UBS is confident that it will prevail on the merits of the case." Based in Zurich, Switzerland, UBS AG (VTX:UBSN) -- http://www.ubs.com/-- is a global provider of financial services for wealthy clients. UBS's financial businesses are organized on a worldwide basis into three Business Groups and the Corporate Center. Global Wealth Management & Business Banking consists of three segments: Wealth Management International & Switzerland, Wealth Management US and Business Banking Switzerland. The Business Groups Investment Bank and Global Asset Management constitute one segment each. The Industrial Holdings segment holds all industrial operations controlled by the Group. Global Asset Management provides investment products and services to institutional investors and wholesale intermediaries around the globe. The Investment Bank operates globally as a client-driven investment banking and securities firm. The Industrial Holdings segment comprises the non-financial businesses of UBS, including the private equity business, which primarily invests UBS and third-party funds in unlisted companies. As reported in the Troubled Company Reporter-Europe, UBS has amassed more than US$53 billion in writedowns and losses since the credit crisis began. The bank expects to post a loss in the second quarter of 2009. The bank's net loss for full-year 2008 widened to CHF19.697 billion from of CHF5.247 million in the prior year. Net losses from continuing operations totaled CHF19.327 billion, compared with losses of CHF5.111 billion in the prior year. UBS attributed the losses to negative revenues in its fixed income, currencies and commodities (FICC) area. For the 2008 fourth quarter, UBS incurred a net loss of CHF8.100 billion, down from a net profit of CHF296 million. Net loss from continuing operations was CHF7.997 billion compared with a profit of CHF433 million. The Investment Bank recorded a pre-tax loss of CHF7.483 billion, compared with a pre-tax loss of CHF2.748 billion in the prior quarter. This result was primarily due to trading losses, losses on exposures to monolines and impairment charges taken against leveraged finance commitments. An own credit charge of CHF1.616 billion was recorded by the Investment Bank in fourth quarter 2008, mainly due to redemptions and repurchases of UBS debt during this period. UBS said it will further reduce its headcount to 15,000 by the end of the year. UBS's personnel numbers reduced to 77,783 on December 31, 2008, down by 1,782 from September 30, 2008, with most staff reductions at its investment banking unit. VALIDUS: AM Best Affirms BB+ Rating on Subordinated Debt -------------------------------------------------------- A.M. Best Co. has removed from under review with negative implications and affirmed the financial strength ratings of A- (Excellent) and issuer credit ratings (ICR) of "a-" of Validus Reinsurance, Ltd. (Bermuda) as well as IPCRe Limited (Bermuda) and IPCRe Europe Limited (Dublin, Ireland). A.M. Best also has removed from under review with negative implications and affirmed the ICR of "bbb-" and the indicative ratings for securities available under the shelf registration of "bbb-" on senior debt, "bb+" on subordinated debt and "bb" on the preferred stock of Validus Holdings, Ltd. (Validus Holdings) (Bermuda). The outlook assigned to the above ratings is stable. Concurrently, A.M. Best has withdrawn the ICR of "bbb-" and the indicative ratings of "bb+" on preferred stock, "bbb" on senior unsecured debt and "bbb-" on subordinated debt for securities available under the former shelf registration of IPC Holdings Ltd. (IPCRe Holdings) as these ratings have been merged out of existence. On September 4, 2009, Validus Holdings completed the acquisition of IPCRe Holdings in exchange for a .9727 common voting share of Validus Holdings for each IPCRe common share and cash consideration of $7.50 per share. This effectively put IPCRe into run off as all renewal business going forward will be written by Validus. Management has indicated its intention to move capital from IPCRe to Validus commensurate with the movement of risk as business renews. A.M. Best will closely monitor this process to ensure capital is kept at levels that support the current ratings. The ratings contemplate the prospective benefits that will be realized through the acquisition due to the larger capital base and market profile. However, it will take time to truly gauge these prospective benefits' impact on the Validus franchise. Partially offsetting these strengths is Validus' susceptibility to low frequency, high severity events as a property catastrophe focused reinsurer and the increased uncertainty over the short term due to the business that was previously underwritten by IPCRe. The stable outlook reflects the expectation that operating performance and risk-adjusted capitalization will continue to remain supportive of the current rating levels. Validus Holdings, Ltd., through its principal operating subsidiary Validus Reinsurance, Ltd. -- http://www.validusre.bm/-- is a global provider of short-tail lines of reinsurance including property catastrophe, property pro-rata and property per risk, marine and energy, and other specialty lines. Validus was formed in December 2005 following the significant natural catastrophes of 2005 with an experienced management team and an unencumbered capital base of approximately $1 billion. As reported in the Troubled Company Reporter on July 15, 2009, A.M. Best Co. has placed the financial strength rating of A- (Excellent) and issuer credit rating (ICR) of "a-" of Validus Reinsurance Ltd. (Validus) (Bermuda) under review with negative implications. A.M. Best also has placed the ICR of "bbb-" and the indicative ratings of "bbb-" on senior debt, "bb+" on subordinated debt and "bb" on the preferred stock of Validus Holdings, Ltd (Validus Holdings) (Bermuda) [NYSE:VR] under review with negative implications. VERENIUM CORP: 1-for-12 Reverse Stock Split Becomes Effective ------------------------------------------------------------- Verenium Corporation said the 1-for-12 reverse split of the Company's common stock became effective at 5:00 p.m. September 9, 2009. Verenium's shares will continue to trade on the NASDAQ Global Market under the symbol "VRNM", with the letter "D" added to the end of the trading symbol for a period of 20 trading days to indicate the reverse stock split has occurred. The Company's symbol will revert back to its original symbol "VRNM" October 7, 2009. Verenium's common stock has been assigned the new CUSIP number 92340P 209. Verenium filed a Certificate of Amendment of Restated Certificate of Incorporation to effect the reverse stock split. The 1-for-12 reverse stock split will automatically convert 12 shares of the Company's common stock into one share of common stock, reducing the number of shares of the Company's common stock outstanding from roughly 111.3 million to roughly 9.3 million shares. Shares of the Company's common stock, underlying stock options, warrants and convertible debt instruments that are outstanding immediately prior to the effective date of the reverse stock split will be affected proportionately. Cash will be paid in lieu of any fractional shares resulting from the reverse stock split. Verenium's transfer agent, American Stock Transfer, is the exchange agent for the reverse split and will distribute a letter of transmittal to record holders with instructions for the surrender of old stock certificates. For beneficial holders of pre-reverse split shares, the brokerage firm where the beneficial shares are held will make the appropriate adjustment to the number of shares held following the effective date of the reverse split. Bankruptcy Warning The Company has indicated that based on its operating plan its existing working capital may not be sufficient to meet cash requirements to fund planned operating expenses, capital expenditures, required and potential payments under its 2007 Notes and 2008 Notes, and working capital requirements beyond 2009 without additional sources of cash or the deferral, reduction or elimination of significant planned expenditures. The Company said these factors raise substantial doubt about the Company's ability to continue as a going concern. As of June 30, 2009, the Company had total assets of $157.3 million; and total liabilities of $168.4 million, resulting in stockholders' deficit of $11.13 million. The Company has a working capital deficit of $16.8 million and an accumulated deficit of $630.2 million as of June 30, 2009. The Company has said if it cannot obtain sufficient additional financing in the short-term, it may be forced to restructure or significantly curtail its operations, file for bankruptcy or cease operations. About Verenium Cambridge, Massachusetts-based Verenium Corporation (NASDAQ: VRNM) -- http://www.verenium.com/-- develops and commercializes cellulosic ethanol, an environmentally friendly and renewable transportation fuel, as well as high-performance specialty enzymes for applications within the biofuels, industrial, and animal health markets. VIASYSTEMS INC: New Bank Facility Won't Affect S&P's 'B+' Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services said that Viasystems Inc.'s (B+/Stable/--) announcement that it has arranged for a new bank credit facility in China does not affect the ratings on the company. Through one of Viasystems' China subsidiaries, the company and a branch of China Construction Bank have entered into an approximately $29 million revolving credit facility secured by a mortgage on the company's Guangzhou factory. The revolver is renewable annually, contains covenants customary in China but contains no financial covenants. Viasystems is terminating its existing Hong Kong-based credit agreement and will prepay its outstanding balance with a draw on the Chinese revolver. Viasystems is also exploring refinancing its outstanding $200 million senior subordinated notes due 2011. The China facility provides Viasystems with a moderate degree of additional financial flexibility. The 2011 notes represent a degree of risk which would be mitigated by the proposed refinancing. Still, Viasystems faces substantial operating pressures, as EBITDA is about half of year-ago levels, and leverage is now in the 5x area. WINDSTREAM CORP: $141 Mil. Deal Won't Affect S&P's 'BB+' Rating --------------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings on Little Rock, Arkansas-based incumbent local exchange carrier Windstream Corp. (BB+/Negative/--) are not affected by the company's definitive agreement to acquire Lexcom Inc. for $141 million in cash, which is likely to close in the fourth quarter of 2009. As of June 30, 2009, Windstream had about $245 million of cash and $493 million of revolver availability, which should be sufficient to cover the purchase of Lexcom as well as the $73 million cash consideration of the pending acquisition of D&E Communications. S&P does not expect the acquisition of Lexcom to materially change Windstream's business or financial risk profile. Lexcom has about 23,000 access lines, representing less than 1% of Windstream's current access-line base. The company's total leverage was 3.6x as of June 30, 2009, which is still high for the current rating, but is unlikely to change from the acquisitions. WINDSTREAM CORP: Lexcom Merger Won't Affect Moody's Ba2 CFR ----------------------------------------------------------- Moody's Investors Service says that Windstream Corporation's announced acquisition of Lexcom, Inc., for about $141 million does not materially alter Windstream's credit profile, including its Ba2 corporate family rating, as the company has ample liquidity to fund the acquisition. The rating outlook remains stable. Moody's most recent rating action for Windstream was on May 11, 2009. At that time Moody's affirmed Windstream's Ba2 corporate family rating, the individual debt ratings and the SGL-1 liquidity rating following the company's announcement that it would buy D&E Communications, Inc. Windstream, headquartered in Little Rock, AR, provides telecommunications services in 16 states and generated about $3.2 billion of annual revenue in 2008. Lexcom, Inc., is a local telephone company headquartered in Lexington, NC. WILLIAM DEL BIAGGIO: Sentenced to More Than 8 Years in Prison ------------------------------------------------------------- Paul Elias at The Associated Press reports that U.S. District Court Judge Charles Breyer has sentenced William James Del Biaggio III, also known as Boots Del Baggio, to more than eight years in prison for fraud. As reported by the TCR on February 10, 2009, that Mr. Del Baggio pleaded guilty to fraud. Mr. Del Biaggio is under investigation by U.S. federal authorities, and is facing several lawsuits which claim that he defrauded lenders when he was obtaining financing to purchase his share of the team last winter. According to The AP, Judge Breyer ordered Mr. Del Biaggio to pay back eight banks and the two National Hockey League owners a total of $47.5 million. The AP relates that Heritage Bank of Commerce, which Mr. Del Biaggio co-founded with his father and which was also a victim in the fraud, would get $4.8 million. Merriman Curhan Ford Group Inc. chief financial officer Henry Tang told Judge Breyer on Tuesday that Mr. Del Baggio's scam cost the company some $10 million in legal fees and forced it to cut its staff from 188 employees to 85, The AP states. The U.S. Securities and Exchange Commission has also filed a lawsuit against Mr. Del Baggio, seeking to recover $20 million of individual investments that the agency claims Mr. Del Biaggio used for personal expenses, The AP says. Judge Breyer, according to The AP, ordered Mr. Del Biaggio to pay back several other victims, including childhood friends and longtime business associates. Mr. Del Biaggio has to repay a total of $67.4 million, the report states. Menlo Park, California-based BDB Management LLC and its affiliates filed for Chapter 11 protection on June 7, 2008 (Bankr. N.D. Calif. Lead Case No. 08-31001). William J. del Biaggio, III, an interest holder of the companies, filed for personal chapter 11 bankruptcy on June 6, 2008. Judith Whitman, Esq., at Diemer Whitman and Cardosi LLP, represents the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed $50 million to $100 million in assets and $50 million to $100 million in debts. The TCR reported on July 9, 2008, that Sara L. Kistler, acting U.S. Trustee for Region 17, appointed R. Todd Nelson as the chapter 11 trustee in BDB Management LLC and its debtor- affiliates' bankruptcy cases. Sand Hill Capital Partners III, the investment fund that Mr. Del Biaggio co-founded, also filed for chapter 7 bankruptcy. Sand Hill disclosed $10.6 million in debts. Established in 1996, Sand Hill Capital has four debt funds under management, of which two are actively investing. Sand Hill has provided debt financing and equity co-investing in multiple portfolio companies of top-tier venture capital firms, including Broadcom, a semiconductor company specializing in VoIP, wireless networking, and broadband communications solutions; Commerce One, a provider of On-Demand Supplier Relationship Management solutions and The Open Supplier Network; IBahn, a provider of secure broadband-to-go at premium hospitality locations; and Odwalla, maker of fruit drinks and snacks. WL HOMES: Sale of Assets to Emaar Expected to Closed by Sept. 30 ---------------------------------------------------------------- Michael Shaw at Sacramento Business Journal reports that the sale of WL Homes/John Laing Homes' assets is expected to close by September 30, 2009. Builder Magazine relate that EJL Homes, the newly created entity formed by WL Homes/John Laing Homes' parent Emaar America Corp., is angling to acquire many of the assets, including those in Northern California. Court documents say that EJL Homes will take over the assets for $7 million. Builder Magazine states that EJL Homes will assume secured debt obligations of $23.6 million, development obligations of $5 million, and lien obligations of $2.1 million associated with the properties. Headquartered in Irvine, California, WL Homes LLC is a homebuilder doing business as John Laing Homes. John Laing traces its history to 1848, when its predecessor was a U.K. homebuilder. WL Homes was formed in 1998 when John Laing merged with Watt Homes. WL Homes and five of its affiliates filed for Chapter 11 protection on February 19, 2009 (Bankr. D. Del. Lead Case No. 09- 10571). Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtors' in their restructuring efforts. Ashby & Geddes represents the Official Committee of Unsecured Creditors. In its bankruptcy petition, WL Homes listed assets of more than $1 billion, and debts between $500 million and $1 billion. As reported in the TCR on June 10, 2009, the Bankruptcy Court converted WL Homes LLC and its debtor affiliates' Chapter 11 cases to cases under Chapter 7 liquidation, at the request of the official committee of unsecured creditors. WOLVERINE FIRE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Wolverine Fire Apparatus Co. of Sherwood Michigan dba Wolverine Fire Apparatus Co., Inc. N6160 County Road D Tilleda, WI 54978 Bankruptcy Case No.: 09-32985 Chapter 11 Petition Date: September 8, 2009 Court: United States Bankruptcy Court Eastern District of Wisconsin (Milwaukee) Debtor's Counsel: Joseph M. Engl, Esq. Krekeler Strother, S.C. 15 North Pinckney Street, Suite 200 P.O. Box 828 Madison, WI 53701-0828 Tel: (608) 258-8555 Fax: (608) 258-8299 Email: jengl@ks-lawfirm.com Estimated Assets: $500,001 to $1,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/wieb09-32985.pdf The petition was signed by Shane Williams, president of the Company. XIOM CORP: June 30 Balance Sheet Upside-Down by $912,000 -------------------------------------------------------- Xiom Corp.'s balance sheet at June 30, 2009, showed total assets of $1,961,561 and total liabilities of $2,874,092, resulting in a stockholders' deficit of $912,531. For the three months ended June 30, 2009, the Company posted a net loss of $847,755 compared with a net loss of $421,447 for the same period in the previous year. For the nine months ended June 30, 2009, the Company posted a net loss of $2,181,379 compared with a net loss of $2,118,139 for the same period in 2008. The Company said that there is substantial doubt about its ability to continue as a going concern. The Company stated that it has a stockholders' deficit as of June 30, 2009, and incurred a net loss for the three and nine months then ended. However, the Company has seen steady sales orders for the patented industrial thermal spray technology and related powder formulas. Furthermore, the Company plans to continue raising capital through a series of private placement transactions during the next 12 months. It also plans to continue to expand sales by significantly increasing domestic marketing efforts, including pursuing major contracts through its network of strategic alliance relationships. As a result of these factors, management believes it will have sufficient resources to meet the Company's cash flow requirements for at least twelve months. A full-text copy of the Company's Form 10-Q is available for free at http://ResearchArchives.com/t/s?4470 Headquartered in West Babylon, New York, Xiom Corp. (OTC BB: XMCP) -- http://xiom-corp.com/-- manufactures industrial based thermal spray coating systems in the United States. It offers XIOM 1000 Thermal Spray system, which is used to apply plastic powder coatings on steel, aluminum, and non-ferrous substrates, as well as on wood, plastic, masonry, and fiberglass. The company also offers plastic powders designed specifically for thermal spraying. XIOM Corp. sells its spray systems directly to commercial customers and coating contractors. The company has introduced a new high production rate spray gun, the XIOM 5000, which sprays up to five times as fast as the current Xiom 1000 gun and has many benefits over the present technology. YL WEST 87TH HOLDINGS: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: YL West 87th Holdings I. LLC 101 West 87th Street, Fifth Floor New York, NY 10024 Case No.: 09-15445 Type of Business: The Debtor operates a real estate business. Chapter 11 Petition Date: September 9, 2009 Court: United States Bankruptcy Court Southern District of New York (Manhattan) Debtor's Counsel: Gary M. Kushner, Esq. Forchelli, Curto, Schwartz, Mineo, et al 330 Old Country Road P.O. Box 31 Mineola, NY 11501 Tel: (516) 248-1700 Ext. 287 Fax: (516) 248-1729 Email: gkushner@fcsmcc.com Estimated Assets: $50,000,001 to $100,000,000 Estimated Debts: $10,000,001 to $50,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. * FDIC to End Debt Guarantee Program on October 31 -------------------------------------------------- The Federal Deposit Insurance Corporation Board has adopted a Notice of Proposed Rulemaking that reaffirms the expiration of the debt guarantee component of the Temporary Liquidity Guarantee Program on October 31, 2009. Under the NPR, the FDIC will seek comment on whether a temporary emergency facility should be left in place for six months after the expiration of the current program. "The TLGP has been very effective at helping financial institutions bridge the uncertainty and dysfunction that plagued our credit markets last fall," said FDIC Chairman Sheila C. Bair. "As domestic credit and liquidity markets appear to be normalizing and the number of entities utilizing the Debt Guarantee Program (DGP) has decreased, now is an important time to make clear our intent to end the program. It is also important to note that the FDIC has collected over $9 billion in fees associated with this program. The FDIC will be using some of this money to off set resolution costs associated with bank failures." There are two alternatives contemplated under the NPR. Under Alternative A, the DGP would expire as provided for by the FDIC's existing regulation on October 31, 2009, with FDIC's guarantee for such debt expiring no later than December 31, 2012. Under Alternative B, the DGP will expire as provided for in the current regulation, however, the FDIC would establish a six-month emergency guarantee facility to be made available in emergency circumstances to insured depository institutions and certain other entities participating in the DGP upon application to the FDIC and with the approval of the Chairman, after consultation with the Board. In October 2008, the FDIC adopted the TLGP as part of a coordinated effort by the FDIC and other federal agencies to address disruptions in credit markets and the resultant inability of financial institutions to obtain funding and make loans to creditworthy borrowers. The NPR passed by the FDIC Board today will be published in the Federal Register and subject to a 15-day comment period. Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures deposits at the nation's 8,195 banks and savings associations and it promotes the safety and soundness of these institutions by identifying, monitoring, and addressing risks to which they are exposed. The FDIC receives no federal tax dollars -- insured financial institutions fund its operations. * Pre-Pack Restructurings Rise After Lehman, Says Allen & Overy --------------------------------------------------------------- One year on from the collapse of Lehman Brothers the global financial markets are taking a back-to-basics approach of cautious deal making and risk analysis, according to a report published September 10 by Allen and Overy. The report, which surveys Allen & Overy partners in 20 countries around the world on changes in market practices in their jurisdictions, indicates: * a tightening of covenants in lending documentation; * significant firming up of legal risk management practices both in banks and by regulators; * increased emphasis on counterparty risk in capital markets structures, but with the preservation of sound market conventions; and * that in restructurings there has been an increase in the use of pre-packs and debt-for-equity conversions, as well as disputes over valuation models. In essence, people are negotiating harder and prudently assessing and managing their risks in a still uncertain market environment. The report was compiled by Allen & Overy Special Global Counsel Philip R. Wood QC (Hon) and shows that while regulators and politicians continue to debate reform of the financial system, the market has responded to recent events and is conducting business with a far more cautious approach to transactions and deals - albeit with a greatly reduced flow of deals in some areas. Commenting, Philip Wood said, "Our report indicates that, in addition to higher pricing and reduced leverage, there has been a significant tightening up of the terms of legal documents. But recent events have not resulted in a revolution in the coverage of the documents for syndicated credits or bond issues or a fundamental reappraisal of non-financial terms. "Legal risk management by banks in relation to their dealings with counterparties in the market and by their regulators has intensified, as one would expect. Aside from much nervousness in credit analysis, the focus has been on the three major risk mitigants: set-off (and its companion close-out netting), security interests and trusts (usually in the form of custodianship of securities). "As to restructurings and reorganisations of companies in dire straits, there are obviously more of them. That means that many more people are now facing all the complications, mess and time that restructurings entail. Our report reviews the market trends in relation to prepackagings, debt-equity conversions and whether the presence of credit default swaps complicates restructurings." The firm's key findings of the analysis were broken down by Lending, Risk Management, Capital Markets, and Restructuring. With respect to Resctructuring, findings are: * Increase in debt-for-equity swaps: Our survey reveals, somewhat unsurprisingly, that there has been a sharp increase in most countries in debt-equity swaps. * CDS holders are not distorting restructurings: Our survey seems to indicate that this situation has been less common than perhaps is currently thought. One reason may be that many restructurings have involved highly leveraged transactions which have not enjoyed CDS protection. Another reason is that sometimes the reorganisation has been pitched so that the CDS protection is technically triggered with the result that the CDS holder is happy. A third reason appears to be that sometimes the CDS holder has got other unprotected exposures which it wishes to rescue by participating in the reorganisation. * Increased use of pre-packs: On the whole there has been an increase in the use of pre-packs in the countries which allow them. The dominance of private deals out of court as a method of resolving financial problems seems to be confirmed. * BOOK REVIEW: An Entrepreneurial History of the United States -------------------------------------------------------------- Author: Gerald Gunderson Publisher: Beard Books Softcover: 286 pages Price: $34.95 Review by Henry Berry The first American colonists were the earliest entrepreneurs in this country. Bearing a positive outlook and pursuing dreams of success, they were the model for generations of entrepreneurs to follow. Yet, unlike their predecessors who found fortune in Europe and other regions of the world, these "Founding Entrepreneurs . . . . had to create a viable operation out of local resources, which had yet to yield anywhere near a competitive return," says Mr. Gunderson in An Entrepreneurial History of the United States. These first capitalists played a critical role in the development of the United States into a global economic power and a country that has, on the whole, created an exemplary standard of living for its citizens. As Mr. Gunderson notes, these early entrepreneurs were successful in "redeploying resources . . . creating exports that were competitive in international trade, and devising organizations that encouraged participants to harness their personal interests toward those of the colony." An Entrepreneurial History of the United States, first published in 1989, chronicles the story of the nation's economic beginning, and makes the story compelling by including profiles of famed business figures and companies. The stories of such entrepreneurs as Robert Fulton, John Jacob Astor, Andrew Carnegie, Thomas Edison, and Henry Ford and such companies as AT&T, DuPont, and Sears Roebuck are told. However, the book is more instructive than that. The author breaks down entrepreneurship into phases tied to ever-changing business conditions and social circumstances. In some cases, entrepreneurship helped to usher in new phases; in other cases, it seized on opportunities for new products or services arising at a particular time. The interplay between entrepreneurs and colonial society is thus a recurrent theme. This book also looks at the personal attributes shared by entrepreneurs, such as a special knowledge or ability in some field, a drive to apply this knowledge or ability to a business market in a novel way, and a combination of practicality and vision in applying the new idea. However, despite their creativity and drive, the author points out that few entrepreneurs were overnight successes. Their accomplishments were earned after a long, persistent period of trial and error. The successful entrepreneur was not an especially ingenious individual who took a big risk and saw it pay off. "A major misconception is that entrepreneurs assume particularly large risks," says Mr. Gunderson. Rather, "a development usually unfolds as continuing, small problems, where mismanagement of an individual opportunity often can be corrected and then recouped by persistence." Entrepreneurs are convinced they are on to something even in the face of obstacles and mismanagement in the early stages of their venture. Mr. Gunderson notes that, "As an entrepreneurial venture grows, its members learn about the niche that the product serves. Frequently the firm becomes recognized as the best source of such expertise in the world." Thus is the formula for success unveiled. Anyone wishing to apply history to their own entrepreneurial dreams should read this book. Gerald Gunderson has held academic positions at Trinity College, the University of Massachusetts, Mount Holyoke College, and North Carolina State University. He is currently editor of the Journal of Private Enterprise. ********* 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. Danilo Munnoz, Joseph Medel C. Martirez, Denise Marie Varquez, Philline Reluya, 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 **