/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/100310.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, March 10, 2010, Vol. 14, No. 68 Headlines 2151 HOTEL: Hearing on Dismissal or Conversion Set for April 5 2151 HOTEL: Section 341(a) Meeting Scheduled for March 17 ABITIBIBOWATER INC: Wants Removal Period Until July 10 ADAM HAMILON KLAYMAN: Case Summary & 14 Largest Unsec. Creditors AGE REFINING: Auction Set for May 1 to Sell Business ALONZO CHAMBLISS: Case Summary & 9 Largest Unsecured Creditors AMERICAN CAPITAL: Extends Lock Up Agreement to March 31 AMERICAN INT'L: ALICO Sale to MetLife Cues Fitch to Keep Ratings AMERICAN INT'L: To Base Bonuses on "Forced Ranking" System AMERICAN INT'L: Inks Deal With Prudential & Petrohue ALLIED SECURITY: Inks Rescission Agreement with AJW Partners AMACORE GROUP: Unit Accepts Termination of Marketing Agreements AMSTED INDUSTRIES: Moody's Assigns 'B1' Senior Unsecured Rating AMSTED INDUSTRIES: S&P Assigns 'BB-' Rating on $500 Mil. Notes ANNIE LEIBOVITZ: Colony to Take Over Debt, Help Market Photos ANTHRACITE CAPITAL: Obligations Under BofA Loan Accelerated APOLLO GOLD: Inks Business Combination Deal with Linear Gold ARVINMERITOR INC: Sells $250-Mil. of 10.625% Notes Due 2018 BI-LO LLC: Club Forest Disputes Assumption of Vacant Store Lease BOISE PAPER: Moody's Assigns 'B2' Rating on $300 Mil. Notes BOISE PAPER: S&P Assigns 'BB-' Rating on $300 Mil. Senior Notes BONEYARD LLC: Creditors Have Until May 1 to Files Proofs of Claim BRUCE NEVIASER: Files List of 16 Largest Unsecured Creditors BRUCE NEVIASER: Files Schedules of Assets & Liabilities BRUCE NEVIASER: Gets Okay to Hire Krekeler as Bankr. Counsel BRUCE NEVIASER: US Trustee Appoints 5 Members to Creditors Panel BRUNO'S SUPERMARKETS: Trustee Appeals Bankruptcy Sale Bonuses CABLEVISION SYSTEMS: Likely Won in Walt Disney Pact, Moody's Says CATALYST PAPER: To Close Exchange Offer for 8-5/8% Notes Today CATHOLIC CHURCH: Victims Fight Wilmington Diocese's Bid to Seal CELL THERAPEUTICS: Compensation Panel Approves Cash Incentives CELEBRITY RESORTS: Blames Rift Among Meyers Family for Bankruptcy CHRYSLER LLC: Chrysler Group Names Two New Executives CHRYSLER LLC: U.S. Trustee Wants Certain Fees Reduced CITADEL BROADCASTING: 7 Affiliates File Statement & Schedules CITADEL BROADCASTING: Radio Assets Files Statement & Schedules CITADEL BROADCASTING: In Talks with Unsec. Creditors on Plan CITIGROUP INC: Liptak to Lead Asia-Pacific Distressed Unit COACHMEN INDUSTRIES: Gabelli's GAMCO Nominates 3 Directors COATES INTERNATIONAL: Ends Coupon Bonds JV Deal with Third Party COMMUNITY EDUCATION: Moody's Withdraws 'B3' Senior Notes Ratings CONTINENTAL AIRLINES: Reports Feb. 2010 Operating Performance CORUS BANKSHARES: Mulling Bankruptcy, To Spar with FDIC on Refunds CYTOMEDIX INC: Posts $566,627 Net Loss in Q3 2009 DENNY HECKER: Lack of Funds Forces Two Defense Counsel to Resign DUANE READE: Denis Nayden Resigns from Board of Directors DUBAI WORLD: Unit Surrenders Former Knickerbocker Hotel to Lender DUBAI WORLD: Nakheel Valuation Delays Final Debt Plan DUBAI WORLD: Nakheel Valuation Delays Final Debt Plan E*TRADE FIN'L: Faces Lindsay Lohan Suit Over TV Ad EAST CAMERON: U.S. Trustee Amends Creditors Committee Composition ELA LLC: Voluntary Chapter 11 Case Summary EMMIS COMMUNICATIONS: Dimensional Holds 5.49% of Class A Shares EMMIS COMMUNICATIONS: Amalgamated Holds 9.3% of Class A Shares EMMIS COMMUNICATIONS: OppenheimerFunds No Longer Holds Shares ENDEAVOUR HIGHRISE: Wonmore Investing Nearly $2MM into Project ERICKSON RETIREMENT: Judge Denies Motion for Sec. 1104 Examiner ERICKSON RETIREMENT: Set for April 13 Plan Confirmation Hearing ERICKSON RETIREMENT: WestSide Wants Lift Stay to Foreclose on Lien EVERYDAY LOGISTICS: Files Schedules of Assets & Liabilities F&M CONSTRUCTION: Voluntary Chapter 11 Case Summary FAIRVUE CLUB: Wants Until June 30 to Propose a Chapter 11 Plan FEC LAFAYETTE: Case Summary & 15 Largest Unsecured Creditors FIRST AMERICAN: Moody's Assigns 'Ba2' Rating on $500 Mil. Loan FIRST MAGNUS: Court Dismisses Fraud & Racketeering Allegations FLINTKOTE CO: Aviva Can't Dodge Covering Flintkote Asbestos Suits FREEDOM COMMUNICATIONS: Court Approves Reorganization Plan GATEHOUSE MEDIA: Incurs $530.6 Million Net Loss for 2009 GENERAL GROWTH: Releases Operating Results for 2009 GENERAL GROWTH: Sees Bankruptcy Emergence by October GENERAL GROWTH: Stonestown Shopping, et al., Win Plan Approval GENERAL MOTORS: Campaigns Against Colorado Bill on Dealers GENERAL MOTORS: Lawmakers Call to Save Delphi Pensions GENERAL MOTORS: New GM May Drop Converj to Focus on Hybrids GENERAL MOTORS: Recalls 1.3 Million Compact Cars GENERAL MOTORS: Cadillac Distances to Avoid Bankruptcy Stigma HANA BIOSCIENCES: Posts $5.7 Million Net Loss in Q3 2009 HOVNANIAN ENT: Swings to $236.1-Mil. Profit in Jan. 31 Quarter INFOGROUP INC: S&P Puts 'BB' Rating on CreditWatch Negative INTERNATIONAL COAL: Moody's Affirms 'Caa1' Corp. Family Rating JCAV LLC: Case Summary & 20 Largest Unsecured Creditors JONES SODA: Inks LOI for Possible Merger with Reeds Inc. JONES SODA: Joth Ricci Resigns as President and CEO JOSE JORGE: U.S. Trustee Unable to Form Creditors Committee KAINOS PARTNERS: Former CFO Faces 15 Years in Prison for Theft KIEBLER SLIPPERY: Wants to Have Until May 24 to Propose a Plan KIWA BIO-TECH: Posts $516,933 Net Loss in Q3 2009 KPT ENTERPRISES: Court OKs Continued Access to Lenders' Cash LEHMAN BROTHERS: Elliot Management to Trade In Claims LEHMAN BROTHERS: LBI Trustee Proposes Barclays-HWA Deal LEHMAN BROTHERS: Seeks to Hire Deloitte as Tax Advisor LEHMAN BROTHERS: Wants to Employ Kleyr as Special Counsel LEHMAN BROTHERS: Wants to Hire Business Process Outsourcer LEHMAN BROTHERS: Wins Approval of GTH Settlement LEHMAN BROTHERS: Vernon Healy Files Investor Claim Against UBS LIFE FUND: Jeff Marwil Confirmed as Chapter 11 Trustee LINEAR TECHNOLOGY: Capital World Holds 11.1% of Common Stock LINEAR TECHNOLOGY: Growth Fund Holds 8.9% of Common Stock LINEAR TECHNOLOGY: State Farm Mutual Holds 7.35% of Common Stock LIONS GATE: S&P Changes Outlook to Negative; Affirms 'B-' Rating LOWER BUCKS: Has Access to Bondholders' Cash Until April 2 LYONDELL CHEMICAL: Parent Reports $317MM Operating Income for 2009 LYONDELL CHEMICAL: Proposes Lender Litigation Settlement LYONDELL CHEMICAL: Rejects Reliance's $14.5 Bil. Bid LYONDELL CHEMICAL: Revises Plan as Creditors Settlement Reached MAJESTIC STAR: Committee Seeks OK to Pursue Claims vs. Lenders MAMMOTH CORONA: Court OKs Stipulation Withdrawing Plan Outline MAMMOTH CORONA: Wants Access to U.S. Bank's Cash Collateral MARINE GROWTH: Earns $1.3 Million in Q3 2009 METRO-GOLDWYN-MAYER: To Pursue Debt-to-Equity Swap if Sale Fails METROPOLITAN LOFTS: Case Converted to Chapter 7 Liquidation MGM MIRAGE: Appoints William Bible as New Director MGM MIRAGE: To Sell $845 Mil. Senior Secured Notes Due 2020 MGM MIRAGE: Appoints William Bible as New Director MGM MIRAGE: To Sell $845 Mil. Senior Secured Notes Due 2020 MICHAEL WILLIAM CURTIS: Voluntary Chapter 11 Case Summary MOVIE GALLERY: Gets Nod for Sonnenschein as Counsel MOVIE GALLERY: Proposes Pachulski as Counsel MOVIE GALLERY: Wins Approval for Kutak Rock as Co-Counsel NEPHROS INC: Posts $711,000 Net Loss in Q3 2009 NEW LEAF BRANDS: David Tsiang Steps Down as Board Member NOVADEL PHARMA: Dec. 31 Balance Sheet Upside Down by $1.3MM ORLEANS HOMEBUILDERS: Gets Nod to Hire Garden City as Claims Agent ORLEANS HOMEBUILDERS: Sec. 341(a) Meeting Scheduled for April 14 ORLEANS HOMEBUILDERS: Taps Cahill Gordon as Bankruptcy Counsel ORLEANS HOMEBUILDERS: Wants FTI Consulting as Financial Advisor ORLEANS HOMEBUILDERS: Committee Organizational Meeting March 11 OVERSEAS SHIPHOLDING: Second Offering Won't Affect Moody's Ratings PACIFIC ETHANOL: Calif. State Court OKs Settlement with Socius PARKER DRILLING: S&P Assigns 'B+' Rating on $300 Mil. Senior Notes PHILOSOPHY INC: S&P Changes Outlook to Stable; Affirms 'B' Rating PNG VENTURES: Wants Exclusive Plan Filing Extended Until May 7 PREMIER GENERAL: Must Answer Involuntary Petition by March 17 PRINCETON OFFICE: Tax Sale Cert. Holder Didn't Hold Tax Claim PROVO CRAFT: S&P Assigns Corporate Credit Rating at 'B' PUREDEPTH INC: To Deregister Common Stock QUAD/GRAPHICS INC: Moody's Assigns 'Ba2' Corporate Family Rating QUAD/GRAPHICS INC: S&P Assigns 'BB' Corporate Credit Rating R STAR RESTAURANTS: Case Summary & 20 Largest Unsecured Creditors RAYMOND HERMAN MEHNER: Voluntary Chapter 11 Case Summary RC SOONER: Gets Interim Nod to Use Fannie Mae's Cash Collateral REGENT COMMUNICATIONS: Gets Court OK to Hire KCC as Claims Agent REGENT COMMUNICATIONS: Sec. 341(a) Meeting Scheduled for March 31 REGENT COMMUNICATIONS: Taps Young Conaway as Delaware Counsel REGENT COMMUNICATIONS: Wants Latham & Watkins as Co-Counsel REPUBLIC STORAGE: Court Closes Chapter 11 Reorganization Case REVLON INC: Proposes Refinancing of Credit Facilities RICHMOND HILLS: Case Summary & 16 Largest Unsecured Creditors ROBERT DUNHAM: Case Summary & 7 Largest Unsecured Creditors ROBERT NAGY: Case Summary & 14 Largest Unsecured Creditors ROSE LEE TAYLOR: Case Summary & 6 Largest Unsecured Creditors RQB RESORT: Files List of 20 Largest Unsecured Creditors RQB RESORT: Gets 35-Day Extension for Filing of Schedules RQB RESORT: Section 341(a) Meeting Scheduled for April 14 RQB RESORT: Taps Smith Hulsey as Bankruptcy Counsel RUBICON US: Noteholders Win Approval to File Rival Plan SARGENT RANCH: Court Establishes April 9 as Claims Bar Date SCHWAB INDUSTRIES: Wants to Hire Laurence Goddard as CRO SPA CHAKRA: Sale to Hercules Technology Approved ST LAWRENCE HOMES: Standard Pacific Acquires 110 Home Sites STANDARD MOTOR: Narrows Net Loss to $5 Mil. in Q4 TEAM NATION: Posts $293,864 Net Loss in Q3 2009 TEAM NATION: Settles Lawsuit Filed Vs. Professional Business Bank TELANETIX INC: Earns $78,407 in Third Quarter TIEGS FAMILY: U.S. Trustee Wants Reorganization Case Dismissed TOUSA INC: Proposes to Enter Into Remington Ranch JV Pacts TOUSA INC: Sets May 14 Administrative Claims Bar Date TOUSA INC: Sets May 14 Customer Claims Bar Date TOUSA INC: Starwood Completes Purchase of Florida Lots TUSCAWILLA HILLS: Case Summary & 12 Largest Unsecured Creditors TREY RESOURCES: Posts $325,402 Net Loss in Q3 2009 TRUMP ENTERTAINMENT: Aims on Shutting Off Payments to Lenders TRUMP ENTERTAINMENT: Icahn's Adviser Lambasts Restructuring Plan U.S. DRY CLEANING: Files for Bankruptcy Due to Capital Woes US FIDELIS: DIP Financing & Cash Collateral Use Get Interim OK US FIDELIS: Taps Scott Eisenberg as Chief Restructuring Officer US FIDELIS: Wants to Hire Lathrop & Gage as Bankruptcy Counsel VAUGHAN CO: To Create New Seven-Member Board of Directors VIANT HOLDINGS: Moody's Retains 'B2' Corporate Family Rating VIKING SYSTEMS: Registers 15 Mil. Shares for Resale VISTEON CORP: Autoliv Acquires Radar Systems Business VISTEON CORP: Calsonic Kansei Settlement Approved by Court VISTEON CORP: Closing of North Penn Facility Approved VISTEON CORP: Wins Approval to Sell AAC JV Assets for $3.1MM VULCAN ADVANCED: Organizational Meeting to Form Panel March 22 WASHINGTON MUTUAL: Court Approves Settlement With Media Vendors WASHINGTON MUTUAL: IRS Withdraws $2.326 Billion Claim WASHINGTON MUTUAL: Marathon Says Dismissal of Claims Premature WAVERLY GARDENS: Unsecured Creditors to Recover 2% of Claims WEBSTER BANK: Moody's Cuts Bank Financial Strength to C From C+ YRC WORLDWIDE: Receives Non-Compliance Notice from Nasdaq ZAYAT STABLE: Has Access to Fifth Third Cash Collateral Until May ZAYAT STABLES: Cleared by Calif. Board for Deals with Bookers * Senate Close to Deal on $50BB Fund to Wind Down Failed Firms * FDIC Plans to Sell $1.37-Bil. of Guaranteed Debt This Week * FDIC Seeks Upfront Bank Levy to Cover Costs of Failure * Banks Face Greater Demand to Repurchase Defective Loans * Upcoming Meetings, Conferences and Seminars ********* 2151 HOTEL: Hearing on Dismissal or Conversion Set for April 5 -------------------------------------------------------------- The U.S. Bankruptcy Court Central District of California will consider at a hearing on April 5, 2010, at 10:00 a.m., the U.S. Trustee's request to dismiss or convert 2151 Hotel Circle South, LLC's Chapter 11 case. The hearing will be held at Courtroom 302, 21041 Burbank Blvd, Woodland Hills, California. The U.S. Trustee for Region 16 sought for the dismissal or conversion of the case to one under Chapter 7 because: -- to date, the Debtor has not filed a disclosure statement and plan of reorganization; and -- the Debtor has failed to comply with the requirements of the U.S. Trustee Chapter 11 Notices and Guides and/or Local Bankruptcy Rules by failing to provide documents, financial reports or attend required meetings. In the alternative, the U.S. Trustee asked the Court to set dates certain for the Debtor to file a disclosure statement and plan, to obtain court approval of the adequacy of information in the disclosure statement, and to obtain court confirmation of a plan of reorganization. The U.S. Trustee also asked that the Court direct the Debtor to comply with the U.S. Trustee requirements. Woodland Hills, California-based 2151 Hotel Circle South, LLC, filed for Chapter 11 on January 4, 2010 (Bankr. C.D. Calif. Case No. 10-10065). The Law Offices of Alexander Lebecki assists the Debtor in its restructuring effort. In its petition, 2151 Hotel listed assets and liabilities both ranging from $10,000,001 to $50,000,000. 2151 HOTEL: Section 341(a) Meeting Scheduled for March 17 --------------------------------------------------------- The U.S. Trustee for Region 16 will convene a meeting of creditors in 2151 Hotel Circle South, LLC's Chapter 11 case on March 17, 2010, at 9:00 a.m. The meeting will be held at 21051 Warner Center Lane, No. 105, Woodland Hills, 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. Woodland Hills, California-based 2151 Hotel Circle South, LLC, filed for Chapter 11 on January 4, 2010 (Bankr. C.D. Calif. Case No. 10-10065). The Law Offices of Alexander Lebecki assists the Debtor in its restructuring effort. In its petition, 2151 Hotel listed assets and liabilities both ranging from $10,000,001 to $50,000,000. ABITIBIBOWATER INC: Wants Removal Period Until July 10 ------------------------------------------------------ AbitibiBowater Inc. and its units ask Bankruptcy Judge Kevin Carey to extend the time within which they may file notices of removal of civil actions and proceedings in state and federal courts to which they are or may become parties to, through and including July 10, 2010, with respect to claims and causes of action pending as of the Petition Date. The Debtors' current Removal Action Period is due to expire on March 12, 2010. Sean T. Greecher, Esq., at Young Conaway Stargatt & Taylor, LLP, in Wilmington, Delaware, relates that since the Second Extended Removal Period, the Debtors have focused principally on the continued rationalization of their operations, the disposition of burdensome assets and a thorough evaluation of their business operations. Moreover, during the past 120 days, the Debtors have established a cross border claims reconciliation protocol, successfully rejected many disadvantageous contracts and leases, and continue to work diligently with the Official Committee of Unsecured Creditors towards crafting a confirmable Chapter 11 plan. However, since the Debtors have paid significant attention to their restructuring efforts, they have not had an opportunity to fully investigate their outstanding litigation matters and adequately consider whether removal, pursuant to Rules 9006(b) and 9027 of the Federal Rules of Bankruptcy Procedure, is appropriate, Mr. Greecher points out. Further extending the Debtors' Removal Period will afford them the additional opportunity to consider removal of the various litigation matters in a fully informed manner and consistent with the best interests of the estates, Mr. Greecher insists. Absent the requested extension, the Debtors would lose a potentially key element of their overall ability to manage litigation during their Chapter 11 cases even before that litigation would reasonably have been evaluated, he asserts. The Court will convene a hearing on March 22, 2010, to consider approval of the Debtors' request. Objections, if any, must be filed by March 15. About AbitibiBowater Inc. Headquartered in Montreal, Canada, AbitibiBowater Inc. -- http://www.abitibibowater.com/-- produces a wide range of newsprint, commercial printing papers, market pulp and wood products. It is the eighth largest publicly traded pulp and paper manufacturer in the world. AbitibiBowater owns or operates 23 pulp and paper facilities and 28 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. Marketing its products in more than 90 countries, the Company is also among the world's largest recyclers of old newspapers and magazines, and has third-party certified 100% of its managed woodlands to sustainable forest management standards. AbitibiBowater's shares trade over-the-counter on the Pink Sheets and on the OTC Bulletin Board under the stock symbol ABWTQ. The Company and several of its affiliates filed for protection under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009 (Bankr. D. Del. Lead Case No. 09-11296). Judge Kevin J. Carey presides over the case. The Company and its Canadian affiliates commenced parallel restructuring proceedings under the Companies' Creditors Arrangement Act before the Quebec Superior Court Commercial Division the next day. Alex F. Morrison at Ernst & Young, Inc., was appointed CCAA monitor. Paul, Weiss, Rifkind, Wharton & Garrison LLP, serves as the Debtors' U.S. bankruptcy counsel. Stikeman Elliot LLP, acts as the Debtors' CCAA counsel. Young, Conaway, Stargatt & Taylor, in Wilmington, Delaware, serves as the Debtors' co-counsel, while Troutman Sanders LLP in New York, serves as the Debtors' conflicts counsel in the Chapter 11 proceedings. The Debtors' financial advisors are Advisory Services LP, and their noticing and claims agent is Epiq Bankruptcy Solutions LLC. The CCAA Monitor's counsel is Thornton, Grout & Finnigan LLP, in Toronto, Ontario. Abitibi-Consolidated Inc. and various Canadian subsidiaries filed for protection under Chapter 15 of the U.S. Bankruptcy Code on April 17, 2009 (Bankr. D. Del. 09-11348). Judge Carey also handles the Chapter 15 case. Pauline K. Morgan, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, in Wilmington, represent the Chapter 15 Debtors. As of Sept. 30, 2008, the Company had $9,937,000,000 in total assets and $8,783,000,000 in total debts. Bankruptcy Creditors' Service, Inc., publishes AbitibiBowater Bankruptcy News. The newsletter provides gavel-to-gavel coverage of the Chapter 11 proceedings and parallel proceedings under the Companies' Creditors Arrangement Act in Canada undertaken by Abitibibowater Inc. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). ADAM HAMILON KLAYMAN: Case Summary & 14 Largest Unsec. Creditors ---------------------------------------------------------------- Joint Debtors: Adam Hamilon Klayman Karla Ann Klayman 133 Bristol Place Ponte Vedra Beach, FL 32082 Bankruptcy Case No.: 10-01752 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Middle District of Florida (Jacksonville) Judge: Jerry A. Funk Debtors' Counsel: Brett A. Mearkle, Esq. Parker & Dufresne, P.A. 8777 San Jose Blvd Suite 301 Jacksonville, FL 32217 Tel: (904) 733-7766 Fax: (904) 7333-2919 Email: bmearkle@jaxlawcenter.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $50,000,001 to $100,000,000 According to the schedules, the Company has assets of $9,741,617, and total debts of $50,261,061. A list of the Company's 14 largest unsecured creditors is available for free at: http://bankrupt.com/misc/flmb10-01752.pdf The petition was signed by the Joint Debtors. AGE REFINING: Auction Set for May 1 to Sell Business ---------------------------------------------------- Bill Rochelle at Bloomberg News reports that Age Refining Inc. obtained approval from the Bankruptcy Court to commence a sale process for its business. It has set an April 15 deadline for initial bids in order to select the stalking horse bidder. Parties are to submit competing bids against the stalking horse bidder by May 1, and an auction will be held May 5 if bids are received. The sale will be approved as part of the process of confirming a Chapter 11 plan. A syndicate of lenders led by JPMorgan Chase Bank, N.A., as administrative agent, is providing the Debtor with $35 million of financing to fund the Chapter 11 case. The terms of the DIP financing, however, requires a quick sale. A plan is also required by March 31. About Age Refining Age Refining, Inc., based in San Antonio, Texas, manufactures, refines and markets jet fuels, diesel products, solvents and other highly specialized fuels. The Company's clients cover a variety of sectors, including commercial, local municipalities and the federal government. Founded in 1991 by Al Gonzalez, AGE is a family owned and operated business in the heart of the San Antonio community. Starting on a shoe-string budget and a bushel of determination, AGE is proud to have posted over 22% growth per year since 1991. The Company filed for Chapter 11 bankruptcy protection on February 8, 2010 (Bankr. W.D. Texas Case No. 10-50501). Aaron Michael Kaufman, Esq.; Carol E. Jendrzey, Esq.; and Mark E. 7Andrews, Esq., at Cox Smith Matthews Incorporated, assist the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. ALONZO CHAMBLISS: Case Summary & 9 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Alonzo Chambliss 3142 Cherry Rd. NE Washington, DC 20018 Bankruptcy Case No.: 10-00212 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court United States Bankruptcy Court for the District of Columbia (Washington, D.C.) Debtor's Counsel: William C. Johnson, Jr., Esq. Law Offices of William C. Johnson, Jr. 1229 15th St. NW Washington, DC 20005 Tel: (202) 525-2958 Fax: (202) 525-2961 Email: wjohnson@dcmdconsumerlaw.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 $1,021,650, and total debts of $1,166,028. A full-text copy of Mr. Chambliss' petition, including a list of his 9 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/dcb10-00212.pdf The petition was signed by Mr. Chambliss. AMERICAN CAPITAL: Extends Lock Up Agreement to March 31 ------------------------------------------------------- American Capital Ltd. disclosed that Wachovia Bank, N.A., as Administrative Agent under the Company's revolving credit agreement, agreed to extend the termination event date under a Lock Up Agreement involving the credit agreement to March 31, 2010. As previously announced, the Company and each of the lenders under the credit agreement entered into the Lock Up Agreement, which, among other things, provides that the parties will support an out- of-court restructuring of the loans outstanding under the credit agreement and of the Company's private and public unsecured notes. The parties may terminate the Lock Up Agreement if certain events do not occur by the termination event date. Any further extension of the termination event date will require the agreement of lenders holding a majority of the amount outstanding under the revolving credit agreement. Additional information on the Lock Up Agreement can be found in certain of the Company's recent reports on Form 8-K and Form 10-K filed with the Securities and Exchange Commission. The Company also announced, as required by NASDAQ Marketplace Rule 5250(b)(2), that while its previously filed consolidated financial statements for the fiscal year ended December 31, 2009, included in the Company's Form 10-K filed with the Securities and Exchange Commission on March 1, 2010, contained an unqualified opinion on the Company's consolidated financial statements from its independent registered public accounting firm, the opinion included a going concern explanatory paragraph as a result of the Company's covenant defaults under its unsecured debt agreements. NASDAQ Marketplace Rule 5250(b)(2) requires separate public disclosure of a previously issued audit opinion that contains a going concern explanatory paragraph. This announcement does not represent any change or amendment to the Company's fiscal year 2009 financial statements or its Form 10-K. About the Company Based in Bethesda, Maryland, American Capital, Ltd. is a publicly traded private equity firm and global asset manager. * * * Ernst & Young Llp, in McLean Virginia, expressed substantial doubt about the Company's ability to continue as a going concern. The independent auditors reported that the Company has incurred net losses of $910 milion and $3.11 billion for the years ended December 31, 2009 and December 31, 2008, respectively. In addition, the Company has received default notices from certain lenders and noteholders for its non-compliance with certain covenants of its unsecured borrowing arrangements, and the Company is generally restricted from issuing any new debt because it has not met the 200% minimum asset coverage requirement under the Investment Company Act of 1940. AMERICAN INT'L: ALICO Sale to MetLife Cues Fitch to Keep Ratings ---------------------------------------------------------------- Following the announcement by American International Group that it has agreed to sell subsidiary American Life Insurance Company to MetLife, Inc., Fitch Ratings has affirmed AIG's Issuer Default Rating and senior and hybrid securities ratings. Additionally, Fitch has revised the Rating Watch status of ALICO's 'A+' Insurer Financial Strength rating to Positive from Evolving. The transaction is valued at $15.5 billion and marks the second major divestiture disclosed by AIG this month. On March 1 AIG announced that it had entered into an agreement to sell its AIA Group Limited subsidiary to Prudential plc for $35.5 billion. Fitch affirmed AIG's IDR and related ratings and revised its Rating Watch status for AIA to Positive from Evolving when that transaction was announced. Fitch views the ratings impact of the ALICO and AIA sales similarly. As a result, the agency has taken equivalent rating actions after the two transactions were announced. AIG's ratings have considered the likelihood of a divestiture of ALICO since AIG formulated its restructuring plan with the federal government in the fourth quarter of 2008. Fitch views AIG's ability to execute on an anticipated transaction favorably but considers the impact of the transaction to largely be a ratings neutral event, thus prompting the affirmation of AIG's ratings. The movement to a Positive from an Evolving Rating Watch for ALICO reflects the company's likely acquisition by a higher rated entity. Fitch rates the IFS of MET's insurance subsidiaries 'AA-'. Fitch will assess the acquisition's ultimate impact on ALICO's ratings following additional analysis of MET's plans for ALICO including, among other items, the nature of the integration process and how ALICO's balance sheet will be managed. Fitch will provide additional commentary on ALICO as this analysis proceeds. Terms of the transaction call for AIG to receive approximately $6.8 billion of cash. Fitch's expectation is that the company will use these proceeds to redeem preferred interests in ALICO that are currently owned by the Federal Reserve Bank of New York. The transaction also calls for the special purpose vehicle formed by AIG and the FRBNY to hold the interests in ALICO to receive $8.7 billion of common equity and hybrid securities issued by MET. Fitch's expectation is that subject to market conditions and the expiration of a minimum-holding period, these proceeds will be monetized with the first $2.2 billion used to redeem the FRBNY's remaining interest in ALICO and the majority of the balance used to repay debt outstanding under AIG's credit facility with the FRBNY. At year-end 2009 AIG's consolidated long-term debt totaled $131 billion including $23 billion of debt outstanding under its credit facility with the FRBNY. As a result, Fitch believes that subsequent to the sale of ALICO and corresponding debt reductions, AIG's leverage while improved, will remain high due in part to high debt levels at the company's aircraft leasing and consumer finance subsidiaries. Fitch's ratings of AIG continue to be 'floored' by an assumption of government support, as AIG's debt leverage and coverage continue to fall outside of Fitch's guidelines for an investment grade credit. Fitch will consider whether it is appropriate to reassess the level of government support to be assumed for the rating as funds to the government are repaid. Fitch takes no action on any ratings of AIG's affiliated companies related to the divestiture of ALICO. This rating has been revised to Rating Watch Positive from Rating Watch Evolving: American Life Insurance Company -- IFS 'A+'. These ratings have been affirmed with an Evolving Rating Outlook: American International Group, Inc. -- Long-term IDR at 'BBB'; -- Senior debt at 'BBB'; -- 6.25% series A-1 junior subordinated debentures due March 15, 2087 at 'B'; -- 5.75% series A-2 junior subordinated debentures due March 15, 2067 at 'B'; -- 4.875% series A-3 junior subordinated debentures due March 15, 2067 at 'B'; -- 6.45% series A-4 junior subordinated debentures due June 15, 2077 at 'B'; -- 7.7% series A-5 junior subordinated debentures due Dec. 18, 2062 at 'B'; -- 8.175% series A-6 junior subordinated debentures due May 15, 2058 at 'B'; -- 8% series A-7 junior subordinated debentures due May 22, 2038 at 'B'; -- 8.625% series A-8 junior subordinated debentures due May 22, 2068 at 'B'; -- 5.67% series B-1 debentures due Feb. 15, 2041 at 'B'; -- 5.82% series B-2 debentures due May 1, 2041 at 'B'; -- 5.89% series B-3 debentures due Aug. 1, 2041 at 'B'. -- Short-term IDR at 'F1'. AIG Funding, Inc. -- Commercial paper at 'F1'. AIG International, Inc. -- Long-term IDR at 'BBB'; -- Senior debt at 'BBB'. AIG Life Holdings (US), Inc. -- Long-term IDR at 'BBB'; -- Senior debt at 'BBB'. American General Capital II -- 8.5% preferred securities due July 1, 2030 at 'B'; American General Institutional Capital A -- 7.57% capital securities due Dec. 1, 2045 at 'B'; American General Institutional Capital B -- 8.125% capital securities due March 15, 2046 at 'B'. AMERICAN INT'L: To Base Bonuses on "Forced Ranking" System ---------------------------------------------------------- The Wall Street Journal's Serena Ng, citing people familiar with the matter, reports that American International Group Inc. is basing its upcoming round of bonuses and incentive pay on its new "forced ranking" system that measures the performances of about 10,000 employees. The Journal says AIG is ranking employee performance from 1 to 5 to help it decide who will get raises and larger incentive awards. About 10% of the employees will receive a "top" ranking, 20% will be rated "excellent," and 50% will see their performance rated "solid." The bottom 20% will be considered to be "needing improvement," of which a small number could get a "performance warning." People familiar with the matter told the Journal AIG is aiming to pay bonuses for 2009 to eligible employees by the end of this month. Ms. Ng reports that the roughly 10,000 individuals whose 2009 performances are being ranked under the system comprised about a tenth of AIG's global work force of 96,000 at the end of 2009. The Journal says those ranked include managers and senior managers, and AIG expects to roll out the system to a bigger universe of employees in 2010. The Journal adds that U.S. compensation czar Kenneth Feinberg is finalizing 2010 pay packages for certain employees at AIG and other companies that have received large amounts of federal aid. Some of AIG's 100 most highly-paid employees, who are subject to Mr. Feinberg's jurisdiction, are among the "pilot group" participating in the forced-ranking system, an AIG spokesman said, according to the Journal. Mr. Feinberg is expected to announce his pay determinations this month, the Journal says. About AIG Based in New York, American International Group, Inc., is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. On September 16, 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. AMERICAN INT'L: Inks Deal With Prudential & Petrohue ---------------------------------------------------- American International Group Inc. and AIA Aurora LLC entered into a definitive agreement with Prudential plc and Petrohue Investments Limited, for the sale of AIA Group Limited to Petrohue, for $35.5 billion, including $25 billion in cash, $5.5 billion in face value of ordinary shares in the capital of Petrohue, $3 billion in face value of mandatory convertible securities of Petrohue, and $2.0 billion in face value of preferred stock of Prudential, subject to closing adjustments. The obligations of Petrohue under the Share Purchase Agreement are guaranteed by Prudential. The consummation of the Share Purchase Agreement is subject to certain conditions, including: (i) the passing of the requisite resolutions by Prudential shareholders; (ii) obtaining the requisite regulatory and antitrust approvals; (iii) the scheme of arrangement between Prudential and its shareholders by means of which Petrohue is expected to become the new holding company of Prudential, becoming effective; (iv) admission of Prudential shares, ordinary shares of Petrohue, mandatory convertible securities and preferred securities to be issued in connection with the transaction to listing on the official list of the United Kingdom Financial Services Authority and to trading on the London Stock Exchange; and (v) other customary conditions. The parties to the Share Purchase Agreement have agreed to use their best endeavors to cooperate to satisfy the conditions to the consummation of the Share Purchase Agreement, and, in particular, Prudential has agreed that the board of directors of Prudential will recommend that shareholders vote in favor of the requisite resolutions, subject always to the directors' fiduciary duties. If closing has not occurred and the Share Purchase Agreement has not been terminated by August 31, 2010, Petrohue has agreed to pay to Seller an additional amount of consideration equal to 5/1200ths of the cash consideration outstanding per month from September 1, 2010 to the closing date. The material termination provisions under the Share Purchase Agreement allow termination: (i) by AIG or Seller in the event that the board of directors of Prudential withdraws, modifies or qualifies the Board Recommendation in a manner adverse to AIG; (ii) by any party in the event that Prudential shareholders have not passed the requisite resolutions by August 1, 2010; (iii) by any party in the event that closing does not occur by March 1, 2011, subject to options for any party to extend in limited circumstances; (iv) by Petrohue or Prudential in the event of a breach of warranty by AIG giving rise to a material adverse change, subject to cure; (v) by Petrohue or Prudential in the event of a breach of covenant relating to the conduct of the business of AIA and its subsidiaries which is material in the context of the AIA Group taken as a whole, subject to cure; and (vi) by AIG or Seller in the event of a breach of warranty by Petrohue giving rise to a material adverse effect on the ability of it or Prudential to complete the transactions, subject to cure. Petrohue has agreed to pay to Seller a termination fee of GBP153 million if the Share Purchase Agreement is terminated as a result of certain conditions listed therein, including: (i) the requisite regulatory or antitrust approvals not having been obtained or the failure of the rights issue to be undertaken by Prudential in connection with the transaction, in either case by the Long Stop Date, (ii) Prudential shareholders not having passed the requisite resolutions by August 1, 2010, or (iii) the withdrawal, modification or qualification of the Board Recommendation. Petrohue's liability to AIG and Seller for breach of warranty terminates at closing, with the exception of warranties relating to fundamental transactional matters, such as capacity and title. AIG's liability to Petrohue for breach of warranty terminates at closing, with the exception of the warranties relating to (i) fundamental transactional matters, such as capacity and title, and (ii) the accuracy of information contained in the draft prospectus of AIA prepared in contemplation of the Hong Kong listing and initial public offering of AIA and of additional information provided to Prudential in connection with its preparation of a circular and prospectus. AIG's liability under the warranties relating to the accuracy of such information is capped at $7.5 billion and subject to a limitation period of 12 months. A full-text copy of the Sale Agreement is available for free at http://ResearchArchives.com/t/s?57c6 About American International Group Based in New York, American International Group, Inc., is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. On September 16, 2008, the Federal Reserve Bank created an $85 billion credit facility to enable AIG to meet increased collateral obligations consequent to the ratings downgrade, in exchange for the issuance of a stock warrant to the Fed for 79.9% of the equity of AIG. The credit facility was eventually increased to as much as $182.5 billion. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. ALLIED SECURITY: Inks Rescission Agreement with AJW Partners ------------------------------------------------------------ Allied Security Innovations Inc. entered into a rescission agreement with each of AJW Partners, LLC, AJW Master Fund, Ltd., New Millenium Capital Partners II, LLC, and AJW Offshore, Ltd., as holders of the Company's Callable Secured Convertible Notes. Under the terms of the Rescission Agreement, the parties agreed to rescind a recapitalization agreement dated May 16, 2008 among the Company and the Holders. Under the Recapitalization Agreement, certain convertible debt securities previously held by the Holders were exchanged for the Notes. Under the Rescission Agreement, the Notes are deemed void ab initio as if they were never issued by the Company to the Holders and the Old Notes were returned to the Holders as if they had never been exchanged for the Notes pursuant to the Recapitalization Agreement. As a result of the rescission, the Company is able to reduce its long term liabilities by approximately $8,000,000. A full-text copy of the rescission agreement is available for free at http://ResearchArchives.com/t/s?57c3 About Allied Security Innovations Based in Farmingdale, New Jersey, Allied Security Innovations, Inc. -- http://www.cgm-ast.com/-- provides homeland security products and proprietary criminal justice software to over 3,000 clients worldwide. It is composed of the original DDSI Company, a public company since 1995, and its wholly owned subsidiary, CGM- Applied Security Technologies, Inc., (established in 1978). With manufacturing in Staten Island, ASI is a manufacturer and distributor of Homeland Security products, including indicative and barrier security seals, security tapes and related packaging security systems, protective security products for palletized cargo, physical security systems for tractors, trailers and containers, as well as a number of highly specialized authentication products. Allied Security Innovations stock trades on the OTC Bulletin Board under the symbol "ADSV". * * * As of Sept. 30, 2009, the company has $3,114,181 in total assets and $53,271,783 in total liabilities resulting to a $50,157,602 stockholder's deficit. AMACORE GROUP: Unit Accepts Termination of Marketing Agreements --------------------------------------------------------------- Lifeguard Benefit Services Inc., a wholly owned subsidiary of The Amacore Group Inc., accepted the termination dated February 25, 2010 from Direct Medical Network Solutions Inc. and Consumer Assistance Services Association with respect to certain marketing and servicing agreements specific to Direct Medical products. Based in Tampa, Florida, The Amacore Group Inc. (OTC BB: ACGI) -- http://www.amacoregroup.com/-- provides health-related membership benefit programs, insurance programs, and other innovative and high-quality solutions to individuals, families and employer groups nationwide. Through its wholly owned subsidiary, LifeGuard Benefit Solutions Inc., Amacore has the ability to provide administrative and back- office services to other healthcare companies in addition to expanding its own call center capability through its wholly owned subsidiary, JRM Benefits Consultants LLC and US Heath Benefits Group Inc., a call center-based marketing company. Zurvita Inc., Amacore's newly formed, wholly owned subsidiary specializing in direct to consumer multi-level marketing, provides yet another channel for Amacore's ever-increasing range of healthcare and healthcare-related products. At September 30, 2009, the Company had $17,631,062 in total assets against $21,817,237 in total liabilities and $1,211,000 in Redeemable preferred stock -- Zurvita Holdings. At September 30, the Company had accumulated deficit of $129,443,586 and stockholders' deficit of $5,397,175. Going Concern Doubt McGladrey & Pullen, LLP, in Ft. Lauderdale, raised substantial doubt about the Company's ability to continue as a going concern after auditing the Company's financial results for the year ended December 31, 2008. The auditors pointed that the Company has suffered recurring losses from operations and has negative working capital. According to the Company's Form 10-Q report for the period ended September 30, 2009, filed with the Securities and Exchange Commission, the Company is in default under: -- a Promissory notes payable to investors and shareholders; bearing interest ranging from 8% to 10% per annum; due December 2006. About $415,000 was due under the notes payable as of September 30; -- a Convertible promissory note payable to investor; bearing interest at 7.5% per annum; due December 2006. About $100,000 was due under the notes payable as of September 30; -- a Promissory notes payable to investors and shareholders; bearing interest of 1.53% per annum; due through June 2004, increasing to 15% thereafter. About $114,950 was due under the notes payable as of September 30. AMSTED INDUSTRIES: Moody's Assigns 'B1' Senior Unsecured Rating --------------------------------------------------------------- Moody's Investors Service assigned a B1 senior unsecured rating to Amsted Industries Incorporated's (Amsted) new senior notes due 2018. At the same time, Moody's has affirmed all of Amsted's other ratings (corporate family rating of Ba3). The ratings outlook is stable. Proceeds from the new notes offering will be used to repay the company's existing term loan (rated Ba3, to be withdrawn on close) and a portion of the company's account receivables securitization notes (not rated by Moody's). The Ba3 corporate family rating reflects debt levels that are modest and manageable which is important considering the cyclical nature of the company's business. Although demand at the company's rail and trucking product lines has fallen significantly below peak levels experienced as recently as 2006, the company is expected to generate robust levels of free cash flow while maintaining a sound liquidity profile. In addition, contributions from Amsted's construction and industrial products segment, while similarly affected by weak macroeconomic factors, should continue to provide diversification benefits for the company. The ratings are also supported by the lead market positions held by most of Amsted's product segments, and credit metrics are consistent with the Ba3 rating. Amsted operates under an Employee Stock Ownership Plan, and calls on cash from the company's obligation to purchase ESOP shares in an on-going constraint on the ratings. While cash outlays for stock purchases are expected to be lower in 2010, they will likely represent a material use of the free cash flow that is generated in this period nonetheless. As such, ESOP repurchases could require incremental borrowing, which could constrain the pace of improvement in credit metrics. The stable outlook reflects Moody's belief that, despite the slow demand growth expected for most of Amsted's products, the company will be able to sustain credit metrics at levels that are in-line with those of Ba3-rated peers. The ability of the company to generate sufficient cash flow to cover any growth in ESOP redemptions with only modest and temporary reliance on the credit facility without a substantial increase in debt will be important to the maintenance of Amsted's Ba3 corporate family rating. Ratings or their outlook could be revised upwards if Debt/EBITDA of less than 3 times can be sustained over a prolonged period. Also, free cash flow should strongly exceed ESOP and Stock Appreciation Rights spending through all points in the market cycle, particularly as business levels pick up. Restoration of operating margins above 12% would also be important for upward rating consideration. The ratings may be downgraded if Amsted's product markets suffer a prolonged decline resulting in sustained negative free cash flow or if Amsted was to significantly rely on the revolver over a long period to meet ESOP, CAPEX, or working capital needs, resulting in a material deterioration in liquidity. Downwards rating pressure could also result if Debt/EBITDA is sustained above 4 times or EBIT/Interest is sustained below 2.5 times. Assignments: Issuer: Amsted Industries Incorporated -- Senior Unsecured Regular Bond/Debenture, B1 (LGD4 - 62%) The last rating action was on May 8, 2007, when Amsted's corporate family rating was upgraded to Ba3 from B2. Amsted Industries Incorporated, headquartered in Chicago, Illinois, is a diversified manufacturer of highly engineered industrial components of products used in the railroad, vehicular, construction and industrial sectors. AMSTED INDUSTRIES: S&P Assigns 'BB-' Rating on $500 Mil. Notes -------------------------------------------------------------- Standard & Poor's Ratings Services assigned a 'BB-' issue-level rating to Amsted Industries Inc.'s proposed new $500 million senior unsecured notes. S&P also assigned a recovery rating of '4' to this debt, indicating S&P's expectation of negligible (30%- 50%) recovery in a payment default scenario. In addition, S&P placed the senior secured revolving credit facility issue rating on CreditWatch with positive implications. The ratings on Amsted reflect the company's fair business risk profile, although the company's aggressive financial risk profile more than offsets this. The cyclical nature of its markets, as well as its obligations related to employee stock ownership plan redemptions, somewhat constrain credit quality. The outlook is stable. "While S&P expects the company's end markets to remain weak in 2010, Amsted's strong positions in its end markets are likely to allow it to continue to generate positive cash flow from operations," said Standard & Poor's credit analyst Robyn Shapiro. "However, the expected annual redemptions of the ESOP will limit cash generation for debt reduction," she continued. S&P could take a negative rating action if a worse- than-expected downturn in the company's end markets causes financial covenant compliance to become a concern. The sizable ESOP obligation limits the potential for Standard & Poor's to raise the ratings. ANNIE LEIBOVITZ: Colony to Take Over Debt, Help Market Photos ------------------------------------------------------------- Bloomberg News reports that Colony Capital LLC agreed to take over the debt of Annie Leibovitz after the celebrity photographer bought back control of her works and real estate from Art Capital Group. According to the report, Colony will help market her photos under the agreement. New York-based Art Capital, in a separate statement, said its loan to Ms. Leibovitz has been satisfied, without providing details. Art Capital Group, in September 2008, gave Ms. Leibovitz access to a $24 million loan, backed by rights to her photograph and real estate in New York. Their agreement was that Art Capital would be the "irrevocable, exclusive agent" for the sale of her works and property for the loan's length and for two years after she pays it off. Ms. Leibovitz was unable to pay off the loan. Art Capital later sued Ms. Leibovitz before the New York State Supreme Court, New York County, in Manhattan (Case No. 09-602334), for breach of contract, claiming that Ms. Leibovitz failed to cooperate with the sale of her photographs and did not grant access to the real estate backing the loans. Annie Leibovitz, 59, is the creator of famous photographs including a nude of John Lennon in a fetal position with Yoko Ono, and a portrait of a pregnant, naked Demi Moore published on the cover of Vanity Fair magazine. ANTHRACITE CAPITAL: Obligations Under BofA Loan Accelerated ----------------------------------------------------------- Anthracite Capital, Inc., reports that on February 24, 2010: -- in connection with the continuing events of default under a Master Repurchase Agreement and Annex I thereto, dated as of July 20, 2007, as amended, by and among Anthracite Capital BOFA Funding LLC, as seller, Bank of America, N.A., as a buyer, Banc of America Mortgage Capital Corporation as a buyer, and BANA as agent for the Buyers, the aggregate Repurchase Price as defined in the Repurchase Agreement, originally due on September 30, 2010 under the Repurchase Agreement, became immediately due and payable, and -- in connection with the continuing events of default under the Credit Agreement, dated as of March 17, 2006, as amended, by and among the Company as borrower agent, AHR Capital BofA Limited as a borrower, each of the Company's affiliates from time to time party thereto, and BANA as lender, the Company's borrowings under the Credit Agreement, originally due on September 30, 2010, were accelerated and became immediately due and payable. The Seller's obligations under the Repurchase Agreement were guaranteed by the Company under the Second Amended and Restated Parent Guaranty, dated as of May 15, 2009. On February 24, 2010, roughly $115 million of borrowings and restructuring fees were outstanding under the Repurchase Agreement and roughly $31 million of borrowings and restructuring fees were outstanding under the Credit Agreement. Pursuant to the terms of the Repurchase Agreement and the Credit Agreement and a consent entered into on February 24, 2010, among the BOA Creditors, the Seller, the Borrowers, the Company and its affiliates, (i) the Seller and its relevant affiliates agreed to irrevocably assign to the Buyers all of their right, title and interest in and to the Purchased Assets as defined in the Repurchase Agreement, in partial satisfaction of all amounts owing to the Buyers under the Repurchase Agreement, (ii) the Borrowers and their affiliates agreed to irrevocably assign to the Lender all of their right, title and interest in and to the Eligible Assets as defined in the Credit Agreement, in partial satisfaction of all amounts owing to the Lender under the Credit Agreement, and (iii) the BOA Creditors retained all its security interests under the Repurchase Agreement and the Credit Agreement except for the BOA Second Priority Liens. The Purchased Assets and the Eligible Assets consist of commercial real estate assets financed under the Repurchase Agreement and the Credit Agreement. The Company primarily invests in high yield commercial real estate debt and equity and historically financed its purchases of commercial real estate assets through several funding sources, including its secured facilities with Bank of America under the Repurchase Agreement and the Credit Agreement. After giving effect to the Purchased Assets Assignment and the Eligible Assets Assignment, (i) the BOA Creditors have assumed full ownership and control of the Purchased Assets and the Eligible Assets, (ii) any remaining legal or equitable interest or any voting or servicing rights of the Seller or its affiliates with respect to the Purchased Assets, along with any remaining right of the Seller to repurchase the Purchased Assets, have been terminated, (iii) any remaining legal or equitable interest or any voting or servicing rights of the Borrowers or their affiliates with respect to the Eligible Assets have been terminated, and (iv) roughly $78 million and $23 million currently remain outstanding under the Repurchase Agreement and the Credit Agreement, respectively. The BOA Creditors separately released any second priority liens it held on the Company's and the Company's affiliates' assets and Morgan Stanley Mortgage Servicing Limited and Morgan Stanley Principal Funding, Inc. released any second priority liens they held on the Purchased Assets and the Eligible Assets. As reported by the Troubled Company Reporter on February 23, 2010, Anthracite Capital said it did not make interest payments due on its outstanding: * $62.5 million aggregate principal amount of 0.75%-to-7.4975% Junior Subordinated Notes due 2035, issued in May 2009 * $31.25 million aggregate principal amount of 0.75%-to-7.4975% Junior Subordinated Notes due 2035, issued in July 2009; * $62.5 million aggregate principal amount of 0.75%-to-7.73% Junior Subordinated Notes due 2036 * EUR37.5 million aggregate principal amount of 0.75%-to- Floating Rate Junior Subordinated Notes due 2022; * EUR25.0 million aggregate principal amount of 0.75%-to- Floating Rate Junior Subordinated Notes due 2022 * $43.5 million aggregate principal amount of 1.25%-to-7.22% Senior Notes due 2016, and * $26.4 million aggregate principal amount of 1.25%-to-7.772%- to-Floating Rate Senior Notes due 2017. As previously disclosed in the Company's filings with the Securities and Exchange Commission, the Company did not make the interest payments due on December 30, 2009, on its outstanding $18.75 million aggregate principal amount of 7.20% Senior Notes due 2016, which was subject to a 30-day cure period before constituting an event of default. The Company failed to make the interest payments due on the 7.20% Notes within this 30-day period. As a result, an event of default occurred and is continuing under the indenture governing the 7.20% Notes. While the event of default is continuing, the trustee or the holders of at least 25% in aggregate principal amount of the 7.20% Notes may, by a written notice to the Company, declare the principal amount of the 7.20% Notes to be immediately due and payable. To date, the Company has not received any such written notice of acceleration. The event of default under the 7.20% Notes has also resulted in additional events of default under each of the Company's secured facilities with Bank of America, BlackRock Holdco 2, Inc. and Morgan Stanley due to cross defaults. Prior to January 30, 2010, events of default already existed under each of the Company's Secured Facilities, as previously disclosed in the Company's filings with the SEC. If any acceleration were to occur under any of the Company's Secured Facilities or any of the Company's other debt instruments in which events of defaults exist, the Company would not have sufficient liquid assets available to repay such accelerated indebtedness and the Company would be unable to continue to fund its operations or continue its business. About Anthracite Capital Anthracite Capital, Inc., is a specialty finance company focused on investments in high yield commercial real estate loans and related securities. Anthracite is externally managed by BlackRock Financial Management, Inc., which is a subsidiary of BlackRock, Inc., one of the largest publicly traded investment management firms in the United States with approximately $1.435 trillion in global assets under management at September 30, 2009. BlackRock Realty Advisors, Inc., another subsidiary of BlackRock, provides real estate equity and other real estate-related products and services in a variety of strategies to meet the needs of institutional investors. At September 30, 2009, the Company had $2,601,125,000 in total assets against $2,064,290,000 in total liabilities, $23,237,000 in 12% Series E-1 Cumulative Convertible Redeemable Preferred Stock, and $23,237,000 in 12% Series E-2 Cumulative Convertible Redeemable Preferred Stock, resulting in stockholders' equity of $490,361,000. APOLLO GOLD: Inks Business Combination Deal with Linear Gold ------------------------------------------------------------ Apollo Gold Corporation and Linear Gold Corp. signed a binding letter of intent to complete a business combination by way of a court approved plan of arrangement to create an emerging Canadian mid-tier gold producer. Under the agreement, Apollo has agreed to acquire all of the outstanding common shares of Linear in exchange for Apollo common shares at an agreed exchange ratio of 5.474 Apollo common shares per Linear common share. This represents a 20.0% premium to Linear shareholders based on the 20-day volume weighted average share price of both companies on the TSX as of March 8, 2010. Under terms of the agreement: -- Linear shareholders will receive 5.474 Apollo common shares per Linear common share which implies a price per Linear share of C$2.30 -- Following completion of the Merger, Apollo will be owned 52.2% by current Apollo shareholders and 47.8% by current Linear shareholders based on current shares issued and outstanding -- On a fully diluted basis, Apollo will be owned 57.1% by current Apollo shareholders and 42.9% by current Linear shareholders -- The Merger values Linear at approximately C$102 million based on current shares outstanding -- Post Merger, the Apollo Board will be comprised of: (i) four existing Apollo directors; (ii) two Linear directors, including the position of Chairman of the Board; and (iii) one new director to be mutually agreed upon -- Linear will purchase, by way of a private placement expected to close shortly after the date hereof (upon receipt of applicable stock exchange approvals), 62,500,000 Apollo common shares at a price of C$0.40 per share for gross proceeds of C$25,000,000 -- The Merger has been unanimously approved by the boards of directors of both companies, and the management and directors of both companies have entered into support agreements, representing approximately 3.7 million Apollo shares and 3.4 million Linear shares -- Apollo's project debt lenders have agreed, subject to a number of terms and conditions, to a standstill until September 30, 2010, in the event of certain events of default -- Following completion of the Merger, Apollo will undergo a rebranding which will result in a new company name -- The Merger will be completed by way of a court-approved plan of arrangement R. David Russell, President and CEO of Apollo, commented, "This is an exciting time for the shareholders of both Apollo and Linear as we take a very important step towards building one of Canada's premier mid-tier gold producers. The successful completion of this Merger will position the combined company to deliver both near and long-term value to its shareholders through existing production growth as well as significant development and exploration upside across a diverse portfolio of precious metal properties." Wade K. Dawe, President and CEO of Linear, said, "This merger allows Linear shareholders to rapidly transition from a development and exploration company to an established gold producer while continuing to participate in the exploration and development upside of the combined assets of the merged company." Upon completion of the Merger, the combined company will have the following compelling and dynamic profile: -- 2010 estimated production at Apollo's Black Fox Mine in the Timmins Mining District, Ontario of approximately 100,000 ounces of gold -- Expected medium-term production growth by 2013 of approximately 70,000 additional ounces of gold per year from Linear's Goldfields project in northern Saskatchewan -- Total reserves of approximately 2.3 million ounces of gold (within 31.2 million tonnes at an average gold grade of 2.3 grams per tonne) in Canada -- Excellent exploration potential within highly prospective land packages in multiple jurisdictions, mostly in Canada and Mexico -- Strengthened balance sheet with lowered debt burden and improved financial flexibility with cash and cash flows available for continued exploration and development -- Strong management team with complementary experience in exploration, development, operations, and financing Benefits to Apollo Shareholders -- After closing, allows Apollo to materially reduce project debt levels and provides immediate capital to fund the underground development at Black Fox as well as an aggressive exploration program at Grey Fox and Pike River to advance towards feasibility in the coming years -- Provides a near term development asset in the Goldfields project that will add low-cost production of approximately 70,000 ounces of gold per year by 2013 -- Expands portfolio of quality exploration assets to include the Chiapas area of southern Mexico and the Dominican Republic -- Delivers value to both current and new shareholders of the company Benefits to Linear Shareholders -- Attractive premium of 20% to Linear shareholders based on 20- day VWAP -- Transitions Linear from a development stage company to a growing gold producer, potentially garnering improved valuation multiples -- All-share Merger allows Linear shareholders to continue to participate in the exploration and development upside of a broad portfolio of properties -- Leverages Apollo's exploration and mine development team which can assist in advancing Linear's Goldfields project Summary of Merger The proposed business combination between Apollo and Linear is expected to be completed by way of a court approved plan of arrangement whereby each Linear common share will be exchanged for 5.474 Apollo shares and Linear will become a wholly-owned subsidiary of Apollo. The number of Apollo shares received upon exercise, and the exercise price, of Linear's outstanding options and warrants will be adjusted proportionately to reflect the share exchange ratio. After giving effect to the Merger, current Linear shareholders will own approximately 42.9% of Apollo (calculated on a fully-diluted basis). The Merger will be subject to the approval of holders of not less than 66 2/3% of the Linear common shares and of a majority of the Apollo common shares held by disinterested shareholders voted at special meetings of shareholders that will be called to approve the Merger. Full details of the Merger will be included in the Management Information Circular to be filed with the regulatory authorities and mailed to Linear and Apollo shareholders in accordance with applicable securities laws. A Special Committee comprised of independent members of Linear's Board was formed to consider the Merger. At a meeting of the Special Committee and Board of Directors of Linear held on March 6, 2010, CIBC World Markets Inc. delivered an oral opinion to the effect that as of the date thereof the Exchange Ratio is fair from a financial point of view to the shareholders of Linear. The Linear directors and officers have also agreed to vote their shares in favour of the Merger under the terms of support agreements with Apollo. A Special Committee comprised of independent members of Apollo's Board was also formed to consider the Merger. At meetings of the Special Committee and Board of Directors of Apollo held on March 8, 2010, Haywood Securities Inc. delivered an oral opinion to the effect that as of the date thereof the consideration to be paid under the Merger is fair from a financial point of view to the shareholders of Apollo. The Apollo directors and officers have also agreed to vote their shares in favour of the Merger under the terms of support agreements with Linear. The Binding Agreement entered into in connection with the Merger includes reciprocal commitments by Linear and Apollo not to solicit or initiate discussions concerning alternative transactions to the proposed Merger. If the Merger is not completed, the terminating party will pay the other party a termination fee, under certain circumstances, of C$4 million. The companies have also provided certain other customary rights, including a right to match competing offers. The Merger is subject to customary closing conditions including receipt of all necessary court and regulatory approvals, including the approval of the Toronto Stock Exchange and the NYSE Amex. The Merger is expected to close in the second quarter of 2010. Private Placement Financing & Apollo Project Debt Principal Reduction Repayment Linear will acquire, by way of a private placement, 62,500,000 Apollo common shares at a price of C$0.40 per share for gross proceeds to Apollo of approximately C$25,000,000 (the "Private Placement"). The Apollo shares issued in the Private Placement will be subject to the four-month hold period set out in NI 45-102 and will be "restricted securities" under United States federal and state securities law. Apollo will use the proceeds of the Private Placement to repay US$10,000,000 of indebtedness under its Black Fox project facility as described below. The balance of the proceeds will be used for working capital purposes. The Private Placement is not conditional upon the completion of the Merger. The closing of the Private Placement, which is subject to customary conditions precedent, including approval of relevant stock exchanges, is expected to occur on or about March 11, 2010. Following closing of the Merger, an additional US$10 million will be repaid to lower the project facility principal to US$50 million. Further repayments will reduce the principal to US$35 million by December 31, 2010, and a repayment schedule for the remaining balance is to be agreed by September 30, 2010. Black Fox Project Finance Facility Concurrently with the execution of the Binding Agreement, Apollo entered into a consent letter in respect of its US$70 million Project Facility Agreement (the "Facility Agreement") with Macquarie Bank Limited and RMB Australia Holdings Limited (together, the "Banks"). Pursuant to the consent letter, the Banks agreed to, subject to the terms and conditions contained in the consent letter, (i) consent to the Merger and the Private Placement, (ii) subject to completion of the Merger and satisfaction of various terms and conditions, not to accelerate repayment of any amounts owing under the Facility Agreement or to enforce any remedies in each case prior to September 30, 2010, in the event of certain "events of default" or "review events" (each as defined in the Facility Agreement), and (iii) make certain amendments to the Facility Agreement. The amendments to the Facility Agreement include amendments to the repayment schedule as discussed in the previous paragraph and an extension to September 30, 2010, of various covenants contained in the Facility Agreement including relating to the satisfaction of certain completion tests related to the Black Fox project and the obligation to fund a debt reserve account. Management Team and Board of Directors R. David Russell, President & CEO of Apollo, will continue to act in his current role within the new company. Wade Dawe, President & CEO of Linear, will assume the role of Chairman of the Board of Directors of Apollo post closing. The Board of Directors of Apollo will be comprised of seven members, including four current Apollo board members or Apollo nominees, two Linear nominees, including the Chairman, and one nominee who shall be a technical person mutually agreed upon by Apollo and Linear. Going Concern Doubt To date the Company has funded its operations through issuance of debt and equity securities and cash flow generated by the Montana Tunnels joint venture and the Black Fox mine. The Company's ability to continue as a going concern is dependent on its ability to continue to issue debt and/or equity securities, and/or continue to generate cash flow from the Black Fox mine. Currently, the Company is in discussions with the banks regarding rescheduling the quarterly repayment installments under the Black Fox Project Facility to better reflect the expected cash flows from production at Black Fox over the term of the loan. As of September 30, 2009, the Company has a working capital deficiency of $30.6 million and an accumulated deficit of $178.6 million. In addition, as at September 30, 2009, the Company held cash and cash equivalents of $4.5 million and had current debt obligations of $30.3 million consisting of (1) the current portion of the project financing facility of $23.4 million due in quarterly installments beginning on December 31, 2009, (2) the outstanding principal of the Series 2007-A convertible debentures of $4.5 million due in February 2010, and (3) $2.4 million for other current debt. Additionally, as of September 30, 2009, the Company has committed to make capital expenditures of approximately $1.2 million for the continued development of Black Fox. Based on the current cash balance, the projected cash flows from Black Fox and assuming the successful rescheduling of the quarterly installment payments of the Black Fox project facility, the Company expects to have sufficient funds to (1) meet its current debt obligations (after debt rescheduling), (2) fund the capital commitments for the development of Black Fox, and (3) fund corporate expenditures. "If the Company is unable to generate sufficient cash flow from Black Fox, unable to reschedule the quarterly installment payments under the Project Facility and/or secure additional financing, it may be unable to continue as a going concern and material adjustments would be required to the carrying value of assets and liabilities and balance sheet classifications used." About Apollo Gold Based in Greenwood Village, Colorado, Apollo Gold Corporation (TSX: APG; NYSE Amex: AGT) is a growing gold producer that operates the wholly owned Black Fox Mine and mill. Both the mine and mill are located in the Township of Black River-Matheson, near Timmins in Ontario. Apollo also is exploring the adjoining Grey Fox and Pike River properties, all in the greater Timmins gold district in Ontario, Canada, as well as the Huizopa Joint Venture (80% Apollo and 20% Minas de Coronado, S. de R.L. de C.V.), an early stage, gold-silver exploration project, approximately 10 miles southwest of Minefinders' Dolores gold-silver mine, in the Sierra Madres in Chihuahua, Mexico. ARVINMERITOR INC: Sells $250-Mil. of 10.625% Notes Due 2018 ----------------------------------------------------------- ArvinMeritor, Inc., last week issued $250 million aggregate principal amount of the Company's 10.625% Notes due 2018 pursuant to an underwriting agreement with Banc of America Securities LLC and J.P. Morgan Securities Inc., as representatives of the several underwriters. The net proceeds to the Company from the sale of the Securities, after deducting Debt Underwriters' discounts and commissions and other estimated offering expenses payable by the Company, were roughly $239 million. The Debt Underwriters are: Principal Amount Underwriter of notes ----------- ---------------- Banc of America Securities LLC 62,500,000 J.P. Morgan Securities Inc. 62,500,000 Citigroup Global Markets Inc. 37,500,000 RBS Securities Inc. 37,500,000 BNP Paribas Securities Corp. 12,500,000 Fifth Third Securities, Inc. 12,500,000 PNC Capital Markets LLC 12,500,000 Scotia Capital Inc. 12,500,000 ---------------- Total 250,000,000 Certain of the Debt Underwriters or their affiliates participated as equity underwriters of the Company's offering of 17,350,000 shares in an underwritten public offering that occurred concurrently with the offering of the Securities, and certain of the Debt Underwriters are acting as dealer managers for the Company's offer to purchase up to $175 million aggregate principal amount of the Company's 8-3/4% notes due 2012. Certain of the Debt Underwriters or their affiliates are holders of the Company's 8-3/4% notes due 2012 that are subject to such pending offer to purchase. In addition, certain of the Debt Underwriters or their affiliates are lenders under the Company's senior secured credit facility. The Equity Underwriters are: Underwriter Number of shares ----------- ---------------- J.P. Morgan Securities Inc. 6,072,500 Citigroup Global Markets Inc. 6,072,500 UBS Securities LLC 2,168,750 BNP Paribas Securities Corp. 1,388,000 RBS Securities Inc. 867,500 Comerica Securities, Inc. 780,750 ---------------- Total 17,350,000 From time to time in the ordinary course of their respective businesses, the Debt Underwriters and their affiliates have engaged in and may in the future engage in commercial banking, investment management, investment banking, derivatives or financial advisory and other commercial transactions and services with the Company and its affiliates for which they have received or will receive customary fees and commissions. The Securities will mature on March 15, 2018 and bear interest at a fixed rate of 10.625% per annum. The Company will pay interest on the Securities from March 3, 2010 semi-annually, in arrears, on March 15 and September 15 of each year, beginning September 15, 2010. The Securities constitute senior unsecured obligations of the Company and will rank equally in right of payment with its existing and future senior unsecured indebtedness, and effectively junior to its existing and future secured indebtedness to the extent of the security therefor. The Securities are guaranteed on a senior unsecured basis by each of the Company's subsidiaries from time to time guaranteeing its senior secured credit facility, as it may be amended, extended, replaced or refinanced, or any subsequent credit facility (other than two subsidiaries that currently have minimal assets, which the Company plans to dissolve after obtaining all required approvals). A full-text copy of the Company's Prospectus Supplement related to the 10.625% Notes is available at no charge at: http://ResearchArchives.com/t/s?57ea A full-text copy of the Company's Prospectus Supplement related to the Common Stock is available at no charge at: http://ResearchArchives.com/t/s?57eb About ArvinMeritor Inc. Based in Troy, Michigan, ArvinMeritor, Inc. (NYSE: ARM) -- 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. As of September 30, 2009, ArvinMeritor had $2.508 billion in total assets and shareowners' deficit of $1.277 billion. As of September 30, 2009, short-term debt was $97 million; Accounts payable was $674 million; Other current liabilities were $411 million; Liabilities of discontinued operations were $107 million; Long-term debt was $1.080 billion; Retirement benefits were $1.077 billion; Other liabilities were $310 million, and Minority interests were $29 million. * * * According to the Troubled Company Reporter on Jan. 25, 2010, Moody's Investors Service affirmed the Corporate Family and Probability of Default ratings of ArvinMeritor, Inc., at Caa1. In a related action, the rating of the senior secured revolving credit facility was affirmed at B1, and the ratings of the senior unsecured notes were affirmed at Caa2. ArvinMeritor's Speculative Grade Liquidity Rating was raised to SGL-3 from SGL-4. The rating outlook is changed to stable. BI-LO LLC: Club Forest Disputes Assumption of Vacant Store Lease ---------------------------------------------------------------- netDockets reports that Bi-Lo LLC and its landlord, Club Forest Hudson Corners, LLC, filed motions for summary judgment on their dispute regarding Bi-Lo's proposed assumption of the lease for its store #393 in Greer, South Carolina. Bi-Lo operated a Food$mart-branded discount, "extreme value" grocery store. The store served as anchor tenant of the Hudson Corners Shopping Center. Bi-Lo decided to close the store in March 2005 but wants to assume the lease -- not to reopen a store but -- to keep Club Forest from reletting the premises to a competing grocery store. Bi-Lo attempted to sublease store #393 to a non-grocery retailer. netDocket says Bi-Lo claims that received interest from potential subtenants -- Fred's, Inc.; Lifestyle Family Fitness; Discover Church; PetStay; E.C. Barton; and an un-named bowling alley -- but each of the proposals was rejected by Club Forest. According to netDockets, Bi-Lo asserts that it has continued to pay the rent under the lease for the entire period and, further, that the lease contains no express requirement that the premises be maintained "open for business." netDockets says Bi-Lo also asserts that the lease does not require the premises to be operated as a grocery store, but rather allows Bi-Lo to use the premises for "any lawful purpose" except that the premises cannot be used as "a theatre, bowling alley, tavern, lounge, flea market, wholesale business, or place of recreation or amusement." According to netDockets, while Bi-Lo states that it intends to continue to attempt to find a non-grocery subtenant for the premises and that the "real dispute between the parties is whether these repeated refusals [to accept proposed subtenants] are consistent with Club Forest's obligation under the Lease not to withhold its consent unreasonably," Bi-Lo is not asking the bankruptcy court to address that specific issue. netDockets says Bi-Lo only seeks to have the court determine that its decision to keep the property dark does not constitute a default that would preclude assumption. netDockets says Club Forest argues that the lack of an operating anchor tenant is impacting the performance of the overall shopping center. Club Forest, according to netDockets, points to several leases with other tenants in the Hudson Corners Shopping Center which either give them the right to terminate their leases on short notice or entitle them to rent abatements if the Bi-Lo store premises remain dark. This demonstrates, according to Club Forest, that "should the demised premises remain a closed store location, not open to the public for business, the result will disrupt the tenant mix in and, therefore, rental income from the shopping center." netDocket says Club Forest also asserts that Bi-Lo is also failing to meet other obligations under Section 365 of the Bankruptcy Code that preclude assumption because of the risk that other tenants will terminate their leases if the store remains vacant. netDocket says Bi-Lo is represented in the dispute by Vinson & Elkins L.L.P. and Nelson Mullins Riley & Scarborough, LLP. Club Forest is represented by Driscoll Sheedy, P.A. About BI-LO LLC Headquartered in Mauldin, South Carolina, BI-LO LLC operates 214 supermarkets in South Carolina, North Carolina, Georgia and Tennessee, and employs approximately 15,500 people. Dallas-based Lone Star Funds bought the business in 2005 from Koninklijke Ahold NV, the Dutch supermarket operator. Lone Star also owns Bruno's Supermarkets LLC, a chain of 66 stores that filed under Chapter 11 in February in Birmingham, Alabama. BI-LO and its affiliates filed for Chapter 11 bankruptcy protection on March 23, 2009 (Bankr. D. S.C. Case No. 09-02140). George B. Cauthen, Esq., Frank B. Knowlton, Esq., at Nelson Mullins Riley & Scarborough, L.L.P; Josiah M. Daniel, III, Esq., Katherine D. Grissel, Esq., at Vinson & Elkins L.L.P. in Dallas; and Dov Kleiner, Esq., Alexandra S. Kelly, Esq., at Vinson & Elkins L.L.P., in New York, serve as counsel. Kurtzman Carson Consultants LLC serves as notice and claims agent. BI-LO listed between $100 million and $500 million each in assets and debts. BOISE PAPER: Moody's Assigns 'B2' Rating on $300 Mil. Notes ----------------------------------------------------------- Moody's Investors Service assigned a B2 rating to Boise Paper Holdings, L.L.C.'s proposed $300 million senior unsecured notes due 2020. Boise Paper Holdings, L.L.C., a wholly owned subsidiary of Boise Inc., intends to use existing cash and the proceeds from the proposed note offering to primarily repay the Tranche B term loan facility. Moody's also affirmed the B1 corporate family rating, upgraded the company's senior secured debt to Ba1 from Ba3, and upgraded the unsecured notes due 2017 to B2 from B3 -- refer to the list below. Following the close of the transaction, Moody's will withdraw the ratings on the Tranche B term loan facility. The outlook is stable. The B1 corporate family rating affirmation reflects the company's market position as the third largest producer of uncoated freesheet paper in North America and favorable pricing trends over the intermediate term. The ratings also incorporate weak product demand, high leverage during a slow economic recovery, high input cost exposure, and recent increases in raw material and energy costs. Boise's revolving credit facility and first lien term loan are guaranteed by operating subsidiaries and secured by all assets of the company. Thus, the secured debt ratings are notched up from the B1 corporate family rating to Ba1. The two-notch upgrade to the secured debt ratings to Ba1 from Ba3 reflects the increased amount of unsecured debt in the company's capital structure pro forma for the proposed note offering. The B2 senior unsecured notes have a one-notch differential from the B1 corporate family rating. This results from their lower rank and effective subordination to the first lien debt and potentially $250 million of revolver borrowings. The stable outlook considers the company's recent debt reduction, an improved liquidity position, and stabilizing demand trends in most of the company's paper grades. Despite the 12% decline of uncoated freesheet production in 2009, pricing has remained relatively stable as industry leaders have proactively taken downtime to match production with orders and manage inventory levels. Nonetheless, Moody's believes the company's operating performance will continue to be challenged by a slow economic recovery, unfavorable white collar employment figures, overall weak demand, challenges of shifting to higher margin specialty products and exposure to high fiber and energy costs. The ratings may be upgraded if Boise reduces leverage through a combination of improved paper and linerboard pricing and realization of higher margin specialty products. Specifically, should the company successively reduce debt through internally generated cash flow such that adjusted (RCF-Capex)/Debt exceeds 6% with adjusted Debt/EBITDA below 4.0x (on a sustainable basis), an upgrade may be considered. However, the ratings may be downgraded should the company face significant price and volume deterioration, persistent negative free cash flow, or a material deterioration in liquidity arrangements. Ratings Assigned: -- Senior Unsecured Notes due 2020, B2 (LGD5, 71%) Ratings Upgraded: First Lien Secured Revolver, Ba1 (LGD2, 17%) from Ba3 -- First Lien Secured Term Loan A, Ba1 (LGD2, 17%) from Ba3 -- Senior Unsecured Notes due 2017, B2 (LGD5, 71%) from B3 Ratings Affirmed: -- Corporate Family Rating, B1 -- Speculative Grade Liquidity Rating, SGL-2 Moody's last rating action was on October 16, 2009, when Moody's assigned a B3 rating to Boise's unsecured notes due 2017. Boise Paper Holding, L.L.C., a wholly owned subsidiary of Boise Inc., headquartered in Boise, Idaho, is the third-largest North American producer in uncoated free sheet paper and has a significant presence in the markets for linerboard, corrugated containers, and specialty and premium paper products. BOISE PAPER: S&P Assigns 'BB-' Rating on $300 Mil. Senior Notes --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its issue-level and recovery ratings to Boise Paper Holdings LLC's and Boise Co-Issuer Co.'s (co-issuer) proposed $300 million senior unsecured notes due 2020 based on preliminary terms and conditions. S&P assigned a 'BB-' issue-level rating (the same as the corporate credit rating) and a recovery rating of '3', indicating S&P's expectation of meaningful (50% to 70%) recovery in the event of a payment default. The issue-level and recovery ratings on Boise Paper's senior secured credit facilities remain unchanged at 'BB+' and '1', respectively, indicating S&P's expectation of very high (90%-100%) recovery in the event of a payment default. Similarly, the issue- level and recovery ratings on Boise Paper's existing $300 million 9.00% senior notes due 2017 remain unchanged at 'BB-' and '3', respectively. "The 'BB-' corporate credit rating on Boise Paper reflects the company's participation in cyclical paper and packaging markets, moderate size, customer-concentration risk, and aggressive debt leverage," said Standard & Poor's credit analyst Pamela Rice. The ratings also incorporate the company's moderate product diversity and a growing value-added product mix. Boise is the third-largest producer of uncoated freesheet in North America. It also manufactures containerboard, corrugated products, and newsprint. Ratings List Boise Paper Holdings LLC Corporate Credit Rating BB-/Stable/-- Ratings Assigned Boise Paper Holdings LLC & Boise Co-Issuer Co. (co-issuers) $300 mil snr unsec notes due 2020 BB- Recovery rating 3 BONEYARD LLC: Creditors Have Until May 1 to Files Proofs of Claim ----------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California has set May 1, 2010, as the deadline for any individual or entity and governmental units to file proofs of claim against Boneyard, LLC. Proofs of claim may be filed with: Clerk of the Bankruptcy Court, Santa Ana Division U.S. Bankruptcy Court 411 West Fourth Street Santa Ana, CA 92701 Copies of proofs of claim may be submitted to: Prescott Littlefield Morgan lewis & Bockius LLP 300 S. Grand Avenue, 22nd Floor Los Angeles, CA 90071-3132 Irvine, California-based Boneyard, LLC, is a limited liability company whose sole member is Le Plastrier Management Co., Inc. Boneyard filed for Chapter 11 bankruptcy protection on Dec. 14, 2009 (Bankr. C.D. Calif. Case No. 09-23930). Richard W. Esterkin, Esq., who has an office in Los Angeles, California, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. BRUCE NEVIASER: Files List of 16 Largest Unsecured Creditors ------------------------------------------------------------ Bruce D. Neviaser has filed with the U.S. Bankruptcy Court for the Western District of Wisconsin a list of his 16 largest unsecured creditors. A full-text copy of the list is available for free at: http://bankrupt.com/misc/wiwb10-10062.pdf Middleton, Wisconsin-based Bruce D. Neviaser filed for Chapter 11 bankruptcy protection on January 7, 2010 (Bankr. W.D. Wis. Case No. 10-10062). J. David Krekeler, Esq., who has an office in Madison, Wisconsin, assists the Debtor in his restructuring effort. According to the schedules, the Debtor had $28 million in assets against $24.5 million in debts as of the Petition Date. BRUCE NEVIASER: Files Schedules of Assets & Liabilities ------------------------------------------------------- Bruce D. Neviaser has filed with the U.S. Bankruptcy Court for the Western District of Wisconsin its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $2,701,000 B. Personal Property $25,434,366 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $7,694,417 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $16,783,559 ----------- ----------- TOTAL $28,135,366 $24,477,976 Middleton, Wisconsin-based Bruce D. Neviaser filed for Chapter 11 bankruptcy protection on January 7, 2010 (Bankr. W.D. Wis. Case No. 10-10062). J. David Krekeler, Esq., who has an office in Madison, Wisconsin, assists the Debtor in his restructuring effort. BRUCE NEVIASER: Gets Okay to Hire Krekeler as Bankr. Counsel ------------------------------------------------------------ Bruce D. Neviaser sought and obtained permission from the Hon. Robert D. Martin of the U.S. Bankruptcy Court for the Western District of Wisconsin to employ Krekeler Strother, S.C., as bankruptcy counsel. Krekeler Strother will assist in preparing the disclosure statement and plan of reorganization, collect any amounts due the Debtor, and act as a general counsel to the Debtor. Krekeler Strother will be paid based on the hourly rates of its personnel: J. David Krekeler $285 Other Shareholders $285 Associates $130-$225 Paralegals $85 The Debtor assured the Court that Krekeler Strother is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Middleton, Wisconsin-based Bruce D. Neviaser filed for Chapter 11 bankruptcy protection on January 7, 2010 (Bankr. W.D. Wis. Case No. 10-10062). J. David Krekeler, Esq., who has an office in Madison, Wisconsin, assists the Debtor in his restructuring effort. According to the schedules, the Debtor had $28 million in assets against $24.5 million in debts as of the Petition Date. BRUCE NEVIASER: US Trustee Appoints 5 Members to Creditors Panel ---------------------------------------------------------------- William T. Neary, the U.S. Trustee for Region 11, appoints five members to the Official Committee of Unsecured Creditors in Bruce D. Neviaser's Chapter 11 cases. The Committee members include: 1) Johnson Bank Attn: Anne Fink 525 Junction Road Madison, WI 53717 Tel: (608) 203-3907 Fax: (608) 203-3939 E-mail: afink@johnsonbank.com 2) Greenway Office Center L.L.C. Attn: Mickey N. Conrad P.O. Box 7700 Madison, WI 53707-7700 Tel: (608) 830-6311 Fax: (608) 662-0500 E-mail: mconrad@twallproperties.com 3) Park Bank Attn: Darwin Lynde 1815 Greenway Cross P.O. Box 8969 Madison, WI 53708-8969 Tel: (608) 278-2850 Fax: (608) 278-2854 E-mail: dlynde@parkbank.com 4) Timothy Downey Attn: Timothy Downey 475 E. Deerpath Lake Forest, IL 60045 Tel: (630) 606-9260 Fax: (847) 234-4824 E-mail: tdowney.ddc@gmail.com 5) West Pointe Bank Attn: J. Scott Sitter 1750 Witzel Avenue Oshkosh, WI 54901 Tel: (920) 232-2260 Fax: (920) 232-2266 E-mail: scotts@westptebank.com Middleton, Wisconsin-based Bruce D. Neviaser filed for Chapter 11 bankruptcy protection on January 7, 2010 (Bankr. W.D. Wis. Case No. 10-10062). J. David Krekeler, Esq., who has an office in Madison, Wisconsin, assists the Debtor in his restructuring effort. According to the schedules, the Debtor had $28 million in assets against $24.5 million in debts as of the Petition Date. BRUNO'S SUPERMARKETS: Trustee Appeals Bankruptcy Sale Bonuses ------------------------------------------------------------- The liquidating trustee for Bruno's Supermarkets LLC is appealing a court order giving the company the green light to distribute certain incentive and retention payments to top employees that were triggered by a sale of Bruno's assets, according to Law360. Bruno's Supermarkets LLC -- now known as BFW Liquidation, LLC -- is a privately held company headquartered in Birmingham, Alabama. Bruno's is the parent company of the Bruno's, Food World, and FoodMax grocery store chains, which includes 23 Bruno's, 41 Food World, and 2 FoodMax locations in Alabama and the Florida panhandle. Founded in 1933, Bruno's has operated as an independent company since 2007 after undergoing several transitions and changes in ownership starting in 1995. The current owner is Lone Star Funds, a Dallas-based investor. Bruno's filed for Chapter 11 relief on February 5, 2009 (Bankr. N.D. Ala. Case No. 09-00634). Burr & Forman LLP is the Debtor's lead counsel. Najjar Denaburg, P.C., is the Debtor's conflicts counsel. Greenberg Traurig, LLP, is the official committee of unsecured creditors' counsel. Alvarez & Marsal is the Debtor's restructuring advisor. When Bruno's filed for Chapter 11 protection from its creditors, it listed between $100 million and $500 million each in assets and debts. Bruno's has sold 56 of its stores to C&S Wholesale Grocers Inc., $45.8 million. C&S will operate 31 stores and liquidated the remainder. CABLEVISION SYSTEMS: Likely Won in Walt Disney Pact, Moody's Says ----------------------------------------------------------------- Moody's Investors Service said that a recent dispute between The Walt Disney Company (A2, stable) and Cablevision Systems Corporation (Ba2, stable) was resolved more quickly than expected (albeit not in time for viewers to catch the opening monologue of the Academy Awards), but that there are certain to be more public squirmishes amongst content providers, broadcasters and pay-TV distribution companies in the coming months and years. In yet another high profile contract negotiation between a cable company and a broadcaster (this time one whose owner also owns a major broadcast network and substantial programming content), Disney and Cablevision remained at an impasse for more than 20 hours yesterday before making "significant (enough) progress (in their negotiations)" to restore broadcast carriage of ABC-7 to almost 3.1 million Cablevision customers in and around the New York metropolitan area market. "In Moody's estimation, Moody's believe this translates into an Oscar win for Cablevision as the likely victor, this time around," said Senior Vice President Russell Solomon. Like News Corp (Baa1, stable) in its recent dispute with Time Warner Cable, Inc. (Baa2, stable) over retransmission fees for its owned Fox TV stations just prior to The Sugar Bowl earlier this year, Disney presumably ceded more ground than it would have liked in the settlement, albeit also likely on a short-term basis (one year vs. the more typical three). If not, Cablevision's track record suggests that a blackout of the ABC TV station programming would have almost certainly continued, and potentially on more than just a short-term basis (as evidenced in January when it failed to agree on carriage terms for Scripps Network Interactive Inc.'s (Baa1, stable) Food Network and HGTV channels, which went off the air for three weeks). Odds were high that Cablevision would have to pay something, but the relatively quick resumption of signal carriage (particularly during the broadcast of such a premiere television event and prior to a firm agreement being in place) suggests they are leaning towards something less (and potentially far less) than Disney's initial demand. Either way, the outcome of this very public dispute will be widely watched (even though final terms are usually kept very private) and has the potential to be precedent setting for the entire pay television industry. For Cablevision, the credit implication of losing ABC-7, particularly ahead of the Academy Awards show, is negative because at least some of the cable company's customers were given one more reason to consider joining their neighbors in defecting to an alternative pay-TV service provider, of which there several, as they undoubtedly have grown increasingly tired of these blackouts and threats of the same. Moody's believe that Cablevision's rivals may have modestly benefited from this latest stand-off -- principally Verizon Communications Inc. (A3, stable) with its advanced FiOS fiber optic TV service, although less so than if the programming had not been restored so quickly. For Disney, the credit implication remains largely neutral either way because the ABC network and its New York station are only a small part of Disney's overall business. Still, with another big carriage fee fight with Time Warner Cable Inc. (Baa2, stable) expected this summer, Disney wanted to set a precedent by "winning" the fight with Cablevision, collecting something and establishing at least a baseline pricing level for its high quality programming. And the ramifications for upcoming contract renewals with other pay-TV distributors, which now notably include telephone companies in addition to direct broadcast satellite companies, incumbent cable companies and their rivals, could be more far-reaching. At stake are hundreds of millions of dollars in fees each year that the station affiliates of ABC, CBS, NBC and Fox are demanding (and increasingly getting) from the pay-TV industry in exchange for carrying local and network-TV programming over cable-TV networks. In the latest dispute involving Cablevision, the fees Disney sought for the lone ABC-7 channel amounted to a reported $1 per subscriber, or some $40 million a year, according to Cablevision -- not a significant amount on its own but one that could add up over the long term if the major networks continue to gain momentum and begin winning more of these fights. "We think the major broadcast stations will be the bigger winners in their collective bid to build an incremental affiliate-fee revenue stream, which will serve to partially mitigate their exposure to the volatile advertising markets," noted Mr. Solomon. This is mainly because they have some of the most popular programming content that the cable- and other pay-TV companies need in order to keep subscribers and stay competitive. Ultimately, though, the biggest losers will be consumers as the pay-TV companies invariably raise prices for existing programming packages to offset the added fees. While the situation is far from new, this high-profile dispute has heightened awareness of all affected parties, with some politicians calling for regulatory intervention and others vowing to stay out of the fight, and consumers caught in the middle. Moody's says that there's more to come, for sure. CATALYST PAPER: To Close Exchange Offer for 8-5/8% Notes Today -------------------------------------------------------------- Catalyst Paper Corporation on Monday said its private exchange offer and consent solicitation of its 11% Senior Secured Notes due December 15, 2016, for its outstanding 8-5/8% Senior Notes due June 15, 2011, expired in accordance with its terms at midnight on March 5, 2010. The closing of the Exchange Offer is expected to take place on March 10, 2010, at which time US$280,434,000 in aggregate principal amount of New Notes will be issued. Catalyst has been advised by the exchange agent for the Exchange Offer that, as of the expiration of the Exchange Offer, the aggregate principal amount of Old Notes that had been validly tendered (and not validly withdrawn) and for which related consents had been validly delivered (and not validly revoked) was US$318,676,000, or 89.96% of the outstanding Old Notes. About Catalyst Paper Headquartered in Richmond, British Columbia, Catalyst Paper Corporation (TSX:CTL) manufactures diverse specialty printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With six mills strategically located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 2.5 million tones. At September 30, 2009, the Company had C$2.20 billion in total assets against C$1.29 billion in total liabilities. At September 30, 2009, the Company had liquidity of C$192.9 million, comprised of C$90.6 million cash, and availability of C$102.3 million on the Company's asset-based loan facility. * * * In March 2010, Standard & Poor's Rating Services said it kept its ratings, including its 'CC' long-term corporate credit rating, on Vancouver-based Catalyst Paper Corp. on CreditWatch with negative implications, where they were placed Nov. 25, 2009. Standard & Poor's said it will likely lower the ratings on Catalyst Paper to 'SD' (selective default) upon completion of the exchange offer. "Standard & Poor's views the offer as distressed because it represents a discount on the face value of the existing senior unsecured debt," said Standard & Poor's credit analyst Jatinder Mall. CATHOLIC CHURCH: Victims Fight Wilmington Diocese's Bid to Seal --------------------------------------------------------------- Law360 reports that sexual abuse victims and creditors have issued two letters saying they've reached a stalemate with Catholic Diocese of Wilmington Inc. affiliates over whether to seal the record in the diocese's bankruptcy proceedings, and they're urging the court not to close off all discovery proceedings to the public. The Diocese of Wilmington covers Delaware and the Eastern Shore of Maryland and serves about 230,000 Catholics. The Delaware diocese is the seventh Roman Catholic diocese to file for Chapter 11 protection to deal with lawsuits for sexual abuse. Previous filings were by the dioceses in Spokane, Washington; Portland, Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; and San Diego, California. The bankruptcy filing automatically stayed eight consecutive abuse trials scheduled in Delaware scheduled to begin October 19. There are 131 cases filed against the Diocese, with 30 scheduled for trial. The Diocese filed for Chapter 11 on Oct. 18, 2009 (Bankr. D. Del. Case No. 09-13560). Attorneys at Young Conaway Stargatt & Taylor, LLP, serve as counsel to the Diocese. The Ramaekers Group, LLC is the financial advisor. The petition says assets range $50,000,001 to $100,000,000 while debts are between $100,000,001 to $500,000,000. (Catholic Church Bankruptcy News; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). CELL THERAPEUTICS: Compensation Panel Approves Cash Incentives -------------------------------------------------------------- The Compensation Committee of the Board of Directors of Cell Therapeutics Inc. approved cash incentive awards for 2009 for each of the Company's named executive officers. In determining the cash incentive amounts, the Compensation Committee determined that the Company had achieved the maximum performance goal established under the program for operating capital raised in 2009 and had achieved the target performance goal for the tender of its then-outstanding notes due in 2010-2011 in its publicly registered tender offers for those notes. In addition, the Compensation Committee noted that the Company had completed its new drug application submission for pixantrone in 2009. Based on these achievements and its subjective assessment of each named executive officer's individual performance during fiscal 2009, the Compensation Committee determined to award cash incentives to each of the named executive officers in the following amounts: James A. Bianco, M.D., 90%; Craig W. Philips, 60%; Louis A. Bianco, 62%; Daniel G. Eramian, 57.5%; and Jack W. Singer, M.D., 35%. A full-text copy of the Summary Compensation Table Fiscal 2007- 2009 is available for free at http://ResearchArchives.com/t/s?57a0 About Cell Therapeutics Headquartered in Seattle, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company that develops an integrated portfolio of oncology products aimed at making cancer more treatable. Subsequent to the closure of its Bresso, Italy operations in September 2009, CTI's operations are conducted solely in the United States. Going Concern Doubt San Francisco-based Stonefield Josephson, Inc., has included an explanatory paragraph in their report on Cell Therapeutics, Inc.'s December 31, 2009, 2008 and 2007 consolidated financial statements regarding their substantial doubt as to the Company's ability to continue as a going concern. The independent auditors reported 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, 2009. Bankruptcy Warning In its Form 10-Q report for the period ended September 30, 2009, filed with the Securities and Exchange Commission, the Company warned it does not expect it will have sufficient cash to fund planned operations through the second quarter of 2010, which raises substantial doubt about its ability to continue as a going concern. The Company said if it fails to obtain capital when required, the Company said it may be required to delay, scale back, or eliminate some or all of its research and development programs and may be forced to cease operations, liquidate its assets and possibly seek bankruptcy protection. CELEBRITY RESORTS: Blames Rift Among Meyers Family for Bankruptcy ----------------------------------------------------------------- netDockets relates Celebrity Resorts, LLC, blamed its bankruptcy on three primary factors: -- General economic factors, which resulted in an "unprecedented decrease in revenues" for the timeshare industry beginning in September 2008. -- Disagreements between members of the Meyers family who control the debtors regarding the companies' business model, which resulted in the termination of two family members -- Neil Meyers (the father) and Steve Meyers (a son and the debtors' general counsel) and a lawsuit by Neil Meyers against several of the companies. A second son, Jared Meyers, remains as the chief executive officer of all of the debtors. -- The declaration of a default on a loan owing to Textron Financial Corporation. netDockets further relates the Debtors reported that they collectively have $12 million in unsecured debt and these secured debt: Amount ------ Textron Financial $10,900,000 Farmington Bank $5,500,000 RBC Bank (USA) $1,500,000 Resort Funding, LLC $1,700,000 Fifth Third Bank $2,900,000 Jared & Kristi Meyers $390,000 Celebrity Resorts LLC was founded in 2003 and the group of debtors own and operate 13 vacation timeshare resorts in Colorado, Florida, Hawaii, New Jersey, Nevada, and Pennsylvania. netDockets relates that the Debtors, in their bankruptcy pleadings, claim that they have been "one of the fastest growing timeshare companies in the nation" since their founding. Celebrity Resorts and 35 affiliates voluntarily filed for chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Middle District of Florida in Orlando, on March 5, 2010 (Bankr. M.D. Fla. Case No. 10-03550). Judge Arthur B. Briskman presides over the cases. R. Scott Shuker, Esq., at Latham Shuker Eden & Beaudine LLP, in Orlando, serves as bankruptcy counsel. Celebrity Resorts' petition disclosed estimated assets and debts to be both between $10,000,001 and $50,000,000. CHRYSLER LLC: Chrysler Group Names Two New Executives ----------------------------------------------------- In a continued effort to focus on core competencies and efficiencies, Chrysler Group LLC named two appointments within its executive ranks. Steve Williams has been named Head of Advance Engineering, Planning and Regulatory Affairs. In that role, Williams continues his responsibility for all advance engineering and assumes the Company's regulatory and planning activities. In addition, the Company appointed Stephen J. Bartoli Head of International Product Planning, Business Development and Integration. In this position, Bartoli will be responsible for leading Product Planning, Market, Brand and Business Strategy and Alliance Planning for International markets. Williams joined Chrysler in 1990 and has held a series of positions with increasing responsibility in engineering. He received both a master's degree in mechanical engineering and business administration from Wayne State University. He holds a bachelor's degree in mechanical engineering from Michigan Technological University. Bartoli holds a master's degree in business administration from Kellogg Graduate School of Management, Northwestern University and a bachelor's degree in mechanical engineering from the University of Notre Dame. He joined Chrysler in 1986 and has held various positions in product planning, marketing and international operations where he was the head of Chrysler's European sales, media relations and marketing. About Chrysler Group LLC Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. About Chrysler LLC Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CHRYSLER LLC: U.S. Trustee Wants Certain Fees Reduced ----------------------------------------------------- Diana G. Adams, the United States Trustee for Region 2, says that she has reviewed the fee applications of bankruptcy professionals employed and retained in the Debtors' Chapter 11 cases for the September to December 2009 period and asks the Court to reduce the interim fees allowed to certain of the Professionals. A. Jones Day Jones Day seeks $5,946,182 in fees and reimbursement of out-of- pocket expenses aggregating $137,229 for the September to December 2009 Fee Period. The U.S. Trustee notes that Jones Day agreed to defer $213,662 of the fees it incurred while preparing the Debtors' motion for authority to implement post closing modifications to Chrysler LLC's governance structure and release of certain officers and directors. There are objections to the Release Motion and it has been adjourned without a date and Jones Day agreed to the deferred consideration of its fees until the Release Motion is resolved. In addition, Jones Day agreed to further reduce its fees by $6,881 based on the firm's reduction of the fees of its law clerks consistent with those of the firm's non-attorney employees, the U.S. Trustee says. Jones Day has likewise agreed that its travel meal expense be reduced by $466 pursuant to the U.S. Trustee' request to limit Jones Day's lunch and dinner to $20 and $40 per person. B. Capstone Advisory Group Based upon discussions with the United States Trustee, Capstone Advisory Group has agreed to reduce its laundry expenses by one half, resulting in a $689 reduction. Capstone Advisory has also agreed to reduce certain car service related expenses by $417, representing one half of these car services expenses: * July 20, 2009 amounting to $281; * July 22, 2009 amounting to $319; and * December 1, 2009 amounting to $235. C. Cahill Gordon & Reindel LLP The U.S. Trustee notes that Cahill Gordon incurred fees totaling $38,152, which is approximately 16% of total fees incurred, on "Fee/Employment Applications and Objections" matters. The United States Trustee believes that the amount is excessive, under the circumstances. With regard to Cahill Gordon's previously incurred $687,482 fees for legal services regarding the Release Motion, the U.S. Trustee says that Cahill Gordon agreed to the deferred consideration by the Court of its fees for legal services attendant to the Release Motion, amounting to $68,482. In addition, the U.S. Trustee notes that Cahill seeks $2,031 in aggregate expenses for "word processing" services for the September to December 2009 Period. However, the U.S. Trustee argues that word processing is a clerical service that represents Cahill Gordon's overhead. Thus, the word processing fee should be disallowed. D. Kramer Levin and Mesirow Financial Consulting Kramer Levin has incurred fees totaling $148,730, or 23% of total fees incurred, on Fee Application matters and Mesirow Financial incurred fees totaling $29,412, or 19% percent of total fees incurred, on Fee Application matters. The United States Trustee argues that the amounts are excessive. * * * The Court has approved the interim fee applications of these professionals for the September to December 2009 period: Professional Fees Expenses ------------ ---- -------- Jones Day $5,939,300 $136,762 Capstone Advisory 3,479,643 285,056 Kramer Levin 640,804 43,589 Togut Segal & Segal LLP 544,998 1,724 About Chrysler Group LLC Chrysler Group LLC, formed in 2009 from a global strategic alliance with Fiat Group, produces Chrysler, Jeep(R), Dodge, Ram Truck, Mopar(R) and Global Electric Motorcars (GEM) brand vehicles and products. Headquartered in Auburn Hills, Michigan, Chrysler Group LLC's product lineup features some of the world's most recognizable vehicles, including the Chrysler 300, Jeep Wrangler and Ram Truck. Fiat will contribute world-class technology, platforms and powertrains for small- and medium-sized cars, allowing Chrysler Group to offer an expanded product line including environmentally friendly vehicles. About Chrysler LLC Chrysler LLC and 24 affiliates on April 30 sought Chapter 11 protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead Case No. 09-50002). Chrysler hired Jones Day, as lead counsel; Togut Segal & Segal LLP, as conflicts counsel; Capstone Advisory Group LLC, and Greenhill & Co. LLC, for financial advisory services; and Epiq Bankruptcy Solutions LLC, as its claims agent. Chrysler has changed its corporate name to Old CarCo following its sale to a Fiat-owned company. As of December 31, 2008, Chrysler had $39,336,000,000 in assets and $55,233,000,000 in debts. Chrysler had $1.9 billion in cash at that time. In connection with the bankruptcy filing, Chrysler reached an agreement with Fiat SpA, the U.S. and Canadian governments and other key constituents regarding a transaction under Section 363 of the Bankruptcy Code that would effect an alliance between Chrysler and Italian automobile manufacturer Fiat. Under the terms approved by the Bankruptcy Court, the company formerly known as Chrysler LLC on June 10, 2009, formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC. Fiat has a 20 percent equity interest in Chrysler Group. Bankruptcy Creditors' Service, Inc., publishes Chrysler Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Chrysler LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITADEL BROADCASTING: 7 Affiliates File Statement & Schedules ------------------------------------------------------------- Three debtor-affiliates of Citadel Broadcasting Corporation, reported assets ranging from $118,000,000 to $211,000,000: Debtor Assets Liabilities ------ ------ ----------- Citadel Broadcasting Company $210,753,748 $2,840,476,403 Alphabet Acquisition Corp. 188,197,145 2,916,555,441 Radio Networks LLC 118,631,128 2,333,009,963 DC Radio Assets LLC $77,292,028 $2,211,544,862 LA Radio LLC 22,261,781 2,174,458,197 NY Radio Assets LLC 12,257,783 2,166,692,256 Minneapolis Radio Assets LLC 10,385,509 2,179,789,183 The Debtor-affiliates also filed their statements of financial affairs. Randy L. Taylor, the Debtors' senior vice president and chief financial officer, relates that two of the Debtors earned net revenues from operation of their businesses: (a) Citadel Broadcasting: * $293,207,382 from Jan. 1 to Nov. 30, 2009; * $381,614,798 for 2008; and * $417,963,114 for 2007; (b) Radio Networks: * $111,024,492 from Jan. 1 to Nov. 30, 2009; * $179,149,350 for 2008; and * $107,203,014 for 2007. (c) NY Radio Assets * $20,065,393 from Jan. 1 to Nov. 30, 2009; * $22,230,960 for 2008; and * $13,238,049 for 2007; (d) Minneapolis Radio * $24,887,618 Jan. 1 to Nov. 30, 2009; * $32,115,075 for 2008; and * $19,629,189 for 2007; (e) LA Radio * $10,096,875 Jan. 1 to Nov. 30, 2009; * $15,551,293 for 2008; and * $9,525,214 for 2007; (f) DC Radio Assets * $27,879,628 from Jan. 1 to Nov. 30, 2009; * $36,965,056 for 2008; and * $26,090,696 for 2007. Citadel Broadcasting and Radio Networks also earned (lost) revenue from other sources: (a) Citadel Broadcasting: Amount Year & Source ------ ------------- $13,458 2009 - Interest Income - 3rd Party $32,672 2009 - Interest Income - Intercompany ($72,075) 2009 - Loss on Sale of Assets ($13,960) 2009 - Misc Expense $42,879 2008 - Interest Income - 3rd Party $947,526 2008 - Interest Income - Intercompany ($4,379,172) 2008 - Loss on Sale of Assets $57,692 2007 - Interest Income - 3rd Party $1,093,703 2007 - Interest Income - Intercompany ($5,143,113) 2007 - Loss on Sale of Assets (b) Radio Networks: ($23,654) 2008 - Loss on Sale of Assets (C) Minneapolis Radio Amount Year & Source ------ ------------- $2,000 2009 - Gain on Sale of Assets 11,652 2008 - Gain on Sale of Assets 1,050 2007 - Gain on Sale of Assets (d) LA Radio (820) 2007 - Loss on Sale of Assets (e) DC Radio (86,549) 2009 - Loss on Sale of Assets (796) 2008 - Loss on Sale of Assets $2,500 2007 - Gain on Sale of Assets Within 90 days immediately preceding the Petition Date, Citadel Broadcasting Company paid $67,210,757 to more than 3,000 creditors on account of debts which are not primary consumer debts while Radio Networks paid $44,084,847 to more than 380 creditors. The three Debtors made payments for the benefit of creditors who are insiders within one year immediately preceding the Petition Date. A schedule of the payments is available for free at: http://bankrupt.com/misc/Ctdl3CrdtrsIntC.pdf Within one year immediately before the Petition Date, the Debtors made payments to Radio Assets LLC, an insider: DC Radio $134,551,773 LA Radio 58,394,333 Minneapolis Radio 77,509,983 NY Radio 72,978,777 One year before the Petition Date, the three Debtors were parties to various suits and administrative proceedings. Citadel Broadcasting is a defendant of a litigation filed by Vigilant Insurance Company and Alphabet Acquisition is involved with an employee related matter in the New York State Department of Labor. Radio Networks is a party to five litigations, two of which are settled, and one arbitration with the American Arbitration Association. A list of the litigation and administrative proceeding to which Radio Networks is involved in is available for free at: http://bankrupt.com/misc/RadioNetLit.pdf Radio Networks closed its network disbursement account in Bank of America on August 24, 2009, while Citadel Broadcasting closed certain disbursement and depository accounts in Bank of America, Capital One, and Whitney Bank from August 7 to December 15, 2009. Citadel Broadcasting Company made charitable contributions to various institutions. The largest contribution is $100,000 to Imus Radiothon, a foundation run by an independent contractor. Mr. Taylor discloses that Citadel Broadcasting has already paid more than $14,000,000 in relation to debt and bankruptcy counseling. A schedule of the payments is available for free at: http://bankrupt.com/misc/CtdlBrDebtCounPay.pdf In addition, Citadel Broadcasting transferred three FCC licenses and related fixed assets aggregating more than $40,000,000 to The Last Bastion Station Trust LLC and Wasatch Radio LLC. Citadel Broadcasting, however, holds or controls FCC licenses and related fixed assets owned by Oak Ridge FM, Inc. and Champlain Broadcasting, Inc. The Debtor's books were kept or supervised by: Name Date ---- ---- Randy Taylor 04/01/1999 - Present Senior Vice President and Chief Financial Officer Joseph O'Brien 01/01/2004 - Present Controller Stephanie Lilly 07/01/2003 - Present VP Finance Robert G. Freedline 05/26/2006 - 01/31/2008 CFO Before 2007 up to the present, the Debtor's books were audited by Deloitte & Touche LLP. Mr. Taylor discloses that three of the Debtors are parties to certain suits and administrative proceedings. Minneapolis Radio is involved in an active employee related matter in the U.S. Equal Employment Opportunity Commission. NY Radio is involved in two litigations in the Superior Court of New Haven and the U.S. District Court for the Eastern District of New York. The New York case has been settled. LA Radio was involved in a litigation in the Superior Court of the State of California. NY Radio and LA Radio made charitable contributions to Imus Ranch for Kids With Cancer and various other organizations. The contributions aggregate $15,500. The Debtor's books were kept or supervised by: Name Date ---- ---- Randy Taylor 04/01/1999 - Present Senior Vice President and Chief Financial Officer Joseph O'Brien 01/01/2004 - Present Controller Stephanie Lilly 07/01/2003 - Present VP Finance Robert G. Freedline 05/26/2006 - 01/31/2008 CFO Before 2007 up to the present, the Debtor's books were audited by Deloitte & Touche LLP. About Citadel Broadcasting Citadel Broadcasting Corporation (OTC BB: CTDB) -- http://www.citadelbroadcasting.com/-- is the third largest radio group in the United States, with a national footprint reaching more than 50 markets. Citadel is comprised of 166 FM stations and 58 AM stations in the nation's leading markets, in addition to Citadel Media, which is one of the three largest radio networks in the United States. Citadel Broadcasting filed for Chapter 11 with 50 affiliates on Dec. 20, 2009, in Manhattan (Bankr. S.D.N.Y. Case No. 09-17422). The Company listed assets of $1.4 billion and debt of $2.5 billion in its Chapter 11 filing. Kirkland & Ellis LLP is serving as legal counsel and Lazard Freres & Co. LLC as financial advisor for the restructuring. Kurtzman Carson Consultants is serving as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Citadel Broadcasting Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Citadel Broadcasting Corp. and other affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITADEL BROADCASTING: Radio Assets Files Statement & Schedules -------------------------------------------------------------- A. Real Property $81,687 B. Personal Property B.1 Cash on Hand 0 B.2 Checking & Savings Accounts 2,827,281 B.3 Security Deposits 0 B.4 Household Goods 0 B.5 Books and other collectibles 0 B.6 Wearing apparel 0 B.7 Furs & Jewelry 0 B.8 Firearms 0 B.9 Insurance 0 B.10 Annuities 0 B.11 Education 0 B.12 IRA, ERISA, and other pension 0 B.13 Stock and Interests 0 B.14 Partnerships & joint ventures 0 B.15 Bonds 0 B.16 Accounts Receivable Trade 1,625,385 Intercompany 1,068,736,208 Allowance for bad debt (320,000) B.17 Alimony 0 B.18 Other Liquidated Debts Tax refund - Tennessee 12,413 Tax refund - Georgia 6,440 B.19 Future Interests 0 B.20 Death Benefit Plan 0 B.21 Other Contingent Claims 0 B.22 Patents Undetermined B.23 Licenses Undetermined B.24 Customer Lists 0 B.25 Automobiles 0 B.26 Boats 0 B.27 Aircrafts 0 B.28 Office Equipment 0 B.29 Machinery 221,825 B.30 Inventory 0 B.31 Animals 0 B.32 Crops 0 B.33 Farming 0 B.34 Farm Supplies 0 B.35 Other Personal Property 10,182,551 TOTAL SCHEDULED ASSETS $1,083,373,790 ======================================================= C. Property Claimed as Exempt None D. Secured Claims JPMorgan Chase Bank, N.A. $2,144,387,154 E. Unsecured Priority Claims Undetermined F. Unsecured Non-priority Claims Citadel Broadcasting Company 33,576,419 Citadel Broadcasting Corporation 1,237,001,001 KLOS Syndication Assets LLC 765,551 Others 43,604,375 See http://bankrupt.com/misc/RadioAssSkedF.pdf TOTAL SCHEDULED LIABILITIES $3,459,334,500 ======================================================= Statement of Financial Affairs Randy L. Taylor, Citadel Broadcasting Corporation's senior vice president and chief financial officer, relates that Radio Assets LLC earned net revenues totaling $5,104,249 from the operation of its business from January 1 to November 30, 2009. In addition, the Debtor also earned income other than operation of its business for these periods: Amount Period Source ------ ------ ------ $519,335 2009 Interest income - 3rd party $1,710,592 2008 Interest income - 3rd party $2,039,835 2007 Interest income - 3rd party With regard to debts that are not primary consumer debts, the Debtor paid $58,444,571 to more than 1,500 creditors within 90 days before they filed for bankruptcy protection. A list of the creditors is available for free at: http://bankrupt.com/misc/RadioAss3b.pdf Within one year before the Petition Date, the Debtor paid $61,265 to John M. Dolan who is an insider. The Debtor closed two accounts in Bank of America on August 24 and September 23, 2009. The two accounts were a station disbursement account and a depository account. Within two years immediately preceding the Petition Date, the Debtor's books were kept or supervised by these persons: Name Date ---- ---- Randy Taylor 04/01/1999 - Present Senior Vice President and Chief Financial Officer Joseph O'Brien 01/01/2004 - Present Controller Stephanie Lilly 07/01/2003 - Present VP Finance Robert G. Freedline 05/26/2006 - 01/31/2008 CFO Before 2007 up to the present, the Debtor's books were audited by Deloitte & Touche LLP. Messrs. Taylor and O'Brien and Ms. Lilly were in possession of the books of account and records of the Debtor at the Petition Date. The Debtor's stock is all owned by Alphabet Acquisition Corp. On February 6, 2009, the Debtor terminated its officer, John Mitchell Dolan. About Citadel Broadcasting Citadel Broadcasting Corporation (OTC BB: CTDB) -- http://www.citadelbroadcasting.com/-- is the third largest radio group in the United States, with a national footprint reaching more than 50 markets. Citadel is comprised of 166 FM stations and 58 AM stations in the nation's leading markets, in addition to Citadel Media, which is one of the three largest radio networks in the United States. Citadel Broadcasting filed for Chapter 11 with 50 affiliates on Dec. 20, 2009, in Manhattan (Bankr. S.D.N.Y. Case No. 09-17422). The Company listed assets of $1.4 billion and debt of $2.5 billion in its Chapter 11 filing. Kirkland & Ellis LLP is serving as legal counsel and Lazard Freres & Co. LLC as financial advisor for the restructuring. Kurtzman Carson Consultants is serving as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Citadel Broadcasting Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Citadel Broadcasting Corp. and other affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITADEL BROADCASTING: In Talks with Unsec. Creditors on Plan ------------------------------------------------------------ Don Jeffrey at Bloomberg News reports that Citadel Broadcasting Corp. said at a hearing on March 9 that it is in talks with its unsecured creditors about possible changes to its reorganization plan. "We're working through an agreement we hope to reach with the creditors committee and the lenders," Joshua Sussberg, an attorney for Citadel, told the bankruptcy judge. "We're hopeful over the next couple of days a resolution will be reached." The hearing on the disclosure statement, which explains the terms of the Plan, was adjourned until March 15. Citadel will send the Plan for voting following approval of the disclosure statement. Citadel Broadcasting and its debtor-affiliates submitted to the United States Bankruptcy Court for the Southern District of New York a Chapter 11 Plan of Reorganization and accompanying Disclosure Statement on February 3, 2010. The key terms of the Plan and the Debtors' overall restructuring are: * The Debtors' secured lenders will receive a pro rata share of (i) a new term loan with a $762,500,000 principal amount, with a five-year term and an interest rate of "LIBOR + 800" and a three-percent LIBOR floor and (ii) 90% of the new common stock of "Reorganized Citadel", subject to dilution for distributions of New Common Stock under Reorganized Citadel's Equity Incentive Program. * Holders of unsecured claims, including the deficiency claims of the Lenders, will have the option to receive either (i) a pro rata share of 10% of the New Common Stock or (ii) cash equal to five-percent of the Allowed unsecured claim, which is capped at $2,000,000, and distributed first to the smallest in dollar amount and last to the largest in dollar amount of electing Holders; provided that once the cap is exhausted, electing Holders that did not receive cash will be treated like all non-electing Holders and receive their pro rata share of the New Common Stock. * Shares of New Common Stock will be distributed pursuant to an allocation mechanism designed to ensure compliance with the attribution and foreign ownership rules and regulations of the FCC. * All equity interests in the Debtors will be cancelled or extinguished upon the Plan's effective date. Some shareholders have objected to the plan. Stockholders Virtus Capital LLC and the Kenneth S. Grossman Pension Plan, which hold about 7 million total shares, are objecting to the Plan, saying that the Plan undervalues the company and would enrich senior lenders and company management. They said a turnaround in the radio industry wasn't taken into account when financial projections and valuations were made. About Citadel Broadcasting Citadel Broadcasting Corporation (OTC BB: CTDB) -- http://www.citadelbroadcasting.com/-- is the third largest radio group in the United States, with a national footprint reaching more than 50 markets. Citadel is comprised of 166 FM stations and 58 AM stations in the nation's leading markets, in addition to Citadel Media, which is one of the three largest radio networks in the United States. Citadel Broadcasting filed for Chapter 11 with 50 affiliates on Dec. 20, 2009, in Manhattan (Bankr. S.D.N.Y. Case No. 09-17422). The Company listed assets of $1.4 billion and debt of $2.5 billion in its Chapter 11 filing. Kirkland & Ellis LLP is serving as legal counsel and Lazard Freres & Co. LLC as financial advisor for the restructuring. Kurtzman Carson Consultants is serving as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Citadel Broadcasting Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Citadel Broadcasting Corp. and other affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) CITIGROUP INC: Liptak to Lead Asia-Pacific Distressed Unit ---------------------------------------------------------- Citigroup Inc. hired John Liptak to head Asia-Pacific distressed and special situations on its regional credit trading team, Bloomberg News reported, citing an internal memo by the bank. Mr. Liptak, who most recently ran an Asian special situations fund at Hong Kong-based Tribridge Investment Partners Ltd., will join Citigroup's Asia-Pacific credit trading team. According to Bloomberg, Mr. Liptak, to be based in Hong Kong, will spearhead Citigroup's efforts to bolster its ability to find distressed and special situations investment opportunities, structure them, sell them to clients, trade and act as market makers. He will report to Naresh Narayan, head of Japan credit trading, for the Japan business and Rosa for the rest of the region. About Citigroup Based in New York, Citigroup Inc. (NYSE: C) -- is a global diversified financial services holding company whose businesses provide a broad range of financial services to consumer and corporate customers. Citigroup has roughly 200 million customer accounts and does business in more than 140 countries. Citigroup's businesses are aligned in three reporting segments: (i) Citicorp, which consists of Regional Consumer Banking (in North America, EMEA, Asia, and Latin America) and the Institutional Clients Group (Securities and Banking, including the Private Bank, and Transaction Services); (ii) Citi Holdings, which consists of Brokerage and Asset Management, Local Consumer Lending, and a Special Asset Pool; and (iii) Corporate/Other. As reported in the Troubled Company Reporter on November 25, 2008, the U.S. government entered into an agreement with Citigroup to provide a package of guarantees, liquidity access, and capital. The U.S. Treasury and the Federal Deposit Insurance Corporation agreed to provide protection against the possibility of unusually large losses on an asset pool of roughly $306 billion of loans and securities backed by residential and commercial real estate and other such assets, which will remain on Citigroup's balance sheet. As a fee for this arrangement, Citigroup issued preferred shares to the Treasury and FDIC. The Federal Reserve agreed to backstop residual risk in the asset pool through a non-recourse loan. Citigroup, the third-biggest U.S. bank, received $45 billion in bailout aid. Other bailed-out banks, including Bank of America Corp., Wells Fargo & Co., have pledged to repay TARP money. JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley, repaid TARP funds in June. Citigroup is selling assets to repay the bailout funds. Citigroup is one of the banks that, according to results of the government's stress test, need more capital. COACHMEN INDUSTRIES: Gabelli's GAMCO Nominates 3 Directors ---------------------------------------------------------- Mario Gabelli's GAMCO Asset Management Inc. is seeking the election of Glenn J. Angiolillo, Avrum Gray, and Robert S. Prather, Jr., as directors on Coachmen Industries, Inc.'s Board of Directors. GAMCO also said it will disclose the names of the Company's nominees for which GAMCO does not intend to vote once the Company files its proxy statement for the 2010 Annual Meeting. Coachmen Industries has not yet disclosed the record date for determining shareholders entitled to notice of and to vote at the 2010 Annual Meeting. Shareholders of record at the close of business on the record date will be entitled to vote at the 2010 Annual Meeting. In a Schedule 13D filing with the Securities and Exchange Commission on Monday, GAMCO and its affiliates disclosed that as of March 8, 2010, they hold in the aggregate 1,702,719 Coachmen shares, representing 10.52% of the shares outstanding. Mr. Angiolillo, 56, has been the President of GJA Corporation, a consulting and advisory firm specializing in wealth management since 1998 to present. Mr. Angiolillo is a Director of LICT Corp., formerly known as Lynch Interactive Corp. (2006 - present); Director of NYMagic, Inc. (2002 - present); Director of Trans-Lux Corporation (2009 - present), and a Director of Gaylord Entertainment Co. (2009 - present). Previously, Mr. Angiolillo was a partner and member of the Management Committee in the law firm of Cummings & Lockwood where he concentrated in the areas of corporate law, mergers and acquisitions and banking and finance. Mr. Gray, 73, is the Chairman and Founding Partner of G-Bar Limited Partnership, an independent options trading firms and a specialist in computer-based arbitrage activities in the derivative markets, a position he has held since 1982. Mr. Gray serves as a director of SL Industries, Inc., a manufacturer of power and specialized communication equipment, since 2000. Mr. Gray was Chief Executive of Alloy Consolidated Industries from 1956 through 1991, a privately held universal joint manufacturer and an automotive aftermarket company. Mr. Gray also served on the boards of Lynch Systems, Inc. (1995 - 2001), a capital equipment manufacturer where he was Chairman, Nashua Corporation (2000 - 2009), a manufacturer, converter and marketer of labels and specialty papers, Material Sciences Corporation, (2003 - 2009) a provider of material-based solutions for acoustical and coated applications and LGL Group, Inc. (formerly Lynch Corporation) (1999 - 2009), a diversified holding company. Mr. Gray was the Chairman of the Board of Spertus Institute, as well as a board member of the Illinois Institute of Technology, the Stuart School, and a number of philanthropic organizations, including the Lyric Opera of Chicago and Jewish Federation of Chicago. Mr. Prather Jr., 65, has been the President and Chief Operating Officer of Gray Television, Inc., a television broadcast company, since September 2002. He was an Executive Vice President of Gray Television from 1996 until September 2002. Mr. Prather is also a director of Gray Television, Inc. He has served as Chairman of the Board at Triple Crown Media, Inc., a publishing and communication company, since December 2005. He has also served as Chief Executive Officer and director of Bull Run Corporation, a sports and affinity marketing and management company from 1992 until its merger into Triple Crown Media in 2005. Mr. Prather is also on the Board of Directors of The Georgia World Congress Center (Chairman) from 1993 to present, Draper Holdings Business Trust from 2008 to present, Enterprise Bank from 2007 to present, Swiss Army Brands, Inc. from 1995 to present, and Gaylord Entertainment Company from 2009 to present. Since 2004 Mr. Prather also has been a member of the Board of Directors of GAMCO Investors, Inc., the public company that is the parent of GAMCO. A full-text copy of GAMCO's proxy statement is available at no charge at http://ResearchArchives.com/t/s?580f About Coachmen Industries Coachmen Industries, Inc., doing business as All American Group, is one of America's premier systems-built construction companies operating under the ALL AMERICAN BUILDING SYSTEMS(R), ALL AMERICAN HOMES(R) and MOD-U-KRAF(R) brands, as well as a manufacturer of specialty vehicles through a joint venture with ARBOC Mobility, LLC. All American Group is a publicly held company with stock quoted and traded on the over-the-counter markets under the ticker COHM.PK. All American Group includes All American Homes, LLC and Mod-U- Kraf, LLC, which combined are one of the nation's largest builders of systems-built residential homes. Models range from single- story ranches to spacious two-story colonials to beautifully rustic log homes, under the Ameri-Log(R) brand. A line of solar homes that can generate low to zero energy bills is available under the Solar Village(R) brand. All American Building Systems, LLC, builds large scale projects such as apartments, condominiums, dormitories, hotels, military and student housing. The Company's construction facilities are located in Colorado, Indiana, Iowa, North Carolina and Virginia. * * * In March 2009, Coachmen's independent public accounting firm, Ernst & Young LLP, said that despite the Company's sale of the assets related to its RV Segment, its recurring net losses and lack of current liquidity raise substantial doubt about its ability to continue as a going concern. Coachmen said its ability to continue as a going concern is highly dependent on its ability to obtain financing or other sources of capital. COATES INTERNATIONAL: Ends Coupon Bonds JV Deal with Third Party ---------------------------------------------------------------- Coates International Ltd. terminated its joint venture arrangement with an independent third party which was originally entered into for the purpose of undertaking a private offering of collateralized zero coupon bonds to institutional investors. After careful consideration of this proposed transaction, the board of directors concluded that this transaction should not be further pursued at this timed for these reasons: * The company expects to be in a better position to raise substantial equity at a lower cost and with less effort, once it completes production and delivery of its CSRV Units for installation in the oil and gas fields. * The Company believes it is in its best interest to pursue fund-raising activities with lower potential risk and cost to undertake. The company said is not obligated to incur any additional costs and there are no provisions for any penalties in connection with termination of the JV Agreement. A full-text copy of the company's joint venture arrangement is available for free at http://ResearchArchives.com/t/s?57c5 Going Concern The Company said it incurred net losses for the three and nine month periods ended September 30, 2009 and, except for the year ended December 31, 2008, has incurred recurring annual net losses since inception. As of September 30, 2009, the Company had a Stockholders' Deficiency of $299,000. At September 30, 2009, the Company had negative working capital of ($2,285,000), compared with negative working capital of ($34,000) at December 31, 2008. In addition, the current economic environment, which is characterized by tight credit markets, investor uncertainty about how to safely invest funds and low investor confidence, has introduced additional risk and difficulty in the Company's challenge to secure needed additional working capital. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management has instituted a cost control program intended to cut variable costs to only those expenses that are necessary to complete its activities related to entering the production phase of its operations, develop additional commercially feasible applications of the CSRV technology, seek additional sources of working capital and cover the general and administrative expenses in support of such activities. The Company has been actively undertaking efforts to secure new sources of working capital. During the nine months ended September 30, 2009, the Company received $690,000 from research and development fees and received proceeds of approximately $676,000 from the sale of common stock and warrants. The Company continues to actively seek out new sources of working capital; however, there can be no assurance that it will be successful in these efforts. Weiser LLP, in New York, expressed substantial doubt about Coates International's ability to continue as a going concern after auditing the financial statements for year ended December 31, 2008. The auditing firm said that the Company continues to have negative cash flows from operations, recurring losses from operations in prior years, and has a stockholders' deficiency. About Coates International Based in Wall Township, N.J., Coates International, Ltd. (OTC BB: COTE) -- http://www.coatesengine.com/-- was incorporated on August 31, 1988, for the purpose of researching, patenting and manufacturing technology associated with a spherical rotary valve system for internal combustion engines. This technology was developed over a period of 15 years by Mr. George J. Coates, who is the President and Chairman of the Board of the Company. The Coates Spherical Rotary Valve System (CSRV) represents a revolutionary departure from the conventional poppet valve. It changes the means of delivering the air and fuel mixture to the firing chamber of an internal combustion engine and of expelling the exhaust produced when the mixture ignites. COMMUNITY EDUCATION: Moody's Withdraws 'B3' Senior Notes Ratings ---------------------------------------------------------------- Moody's Investors Service announced that it has withdrawn this rating for business reasons. The proposed notes were not issued. These ratings were withdrawn: -- Community Education Centers' Proposed $210 million Senior Secured Notes The last rating action with respect to Community Education Centers was on February 3, 2010, when the proposed notes were assigned a B3 rating. Community Education Centers is a non-publicly traded company based in West Caldwell, New Jersey. The company currently operates 25 community-based residential facilities, and 60 in prison treatment and education programs. It also manages 17 secure detention facilities. The services provided by the community based facilities included the assessment of causes for criminal behavior; substance abuse counseling and treatment; and individual, group and family therapy. Services focus on education, employment training, and life skills training. In 2007, through an acquisition, the company expanded its services to include secure detention management and in-prison treatment programs. CONTINENTAL AIRLINES: Reports Feb. 2010 Operating Performance ------------------------------------------------------------- Continental Airlines reported a February consolidated (mainline plus regional) load factor of 77.7%, 5.2 points above the February 2009 consolidated load factor, and a mainline load factor of 78.1%, 5.2 points above the February 2009 mainline load factor. Both February load factors were records for the month. The carrier reported a domestic mainline February load factor of 80.6%, 2.9 points above the February 2009 domestic mainline load factor, and a record international mainline load factor of 75.9%, 7.5 points above February 2009. During February, Continental recorded a U.S. Department of Transportation on-time arrival rate of 75.0% and a mainline segment completion factor of 95.4%. Continental's operational results were adversely impacted by severe winter weather, particularly at its New York hub at Newark Liberty International Airport. In February 2010, Continental flew 6.1 billion consolidated revenue passenger miles (RPMs) and 7.8 billion consolidated available seat miles (ASMs), resulting in a consolidated traffic increase of 3.3% and a capacity decrease of 3.8% as compared to February 2009. In February 2010, Continental flew 5.4 billion mainline RPMs and 6.9 billion mainline ASMs, resulting in a mainline traffic increase of 3.2% and a mainline capacity decrease of 3.7% as compared to February 2009. Domestic mainline traffic was 2.7 billion RPMs in February 2010, down 0.5% from February 2009, and domestic mainline capacity was 3.3 billion ASMs, down 4.1% from February 2009. For February 2010, consolidated passenger revenue per available seat mile (RASM) is estimated to have increased between 7.5% and 8.5% compared to February 2009, while mainline RASM is estimated to have increased between 5.5% and 6.5%. Continental estimates that the suspension of operations at its New York hub on February 10, 2010, and February 26, 2010, due to severe winter weather in the New York area reduced its consolidated passenger revenue for the month by roughly $25 million. The combination of available seat mile reductions caused by the two February snowstorms and the company's re-accommodation of many customers who were impacted by its flight cancellations resulted in a year-over-year RASM benefit of roughly one percentage point, compared to the year-over-year RASM performance the company would have expected had the company flown the capacity it cancelled as a result of the storms. For January 2010, consolidated passenger RASM decreased 1.3% compared to January 2009, while mainline passenger RASM decreased 2.8% compared to January 2009. Continental's regional operations had a February load factor of 74.6%, 5.3 points above the February 2009 regional load factor. Regional RPMs were 657.0 million and regional ASMs were 880.2 million in February 2010, resulting in a traffic increase of 3.5% and a capacity decrease of 4.0% versus February 2009. A full-text copy of Continental's news release is available at no charge at http://ResearchArchives.com/t/s?57ed About Continental Airlines Continental Airlines Inc. (NYSE: CAL) -- http://www.continental.com/-- is the world's fifth largest airline. Continental, together with Continental Express and Continental Connection, has more than 2,400 daily departures throughout the Americas, Europe and Asia, serving 130 domestic and 132 international destinations. Continental is a member of Star Alliance, which provides access to more than 900 additional points in 169 countries via 24 other member airlines. With more than 41,000 employees, Continental has hubs serving New York, Houston, Cleveland and Guam, and together with its regional partners, carries roughly 63 million passengers per year. At December 31, 2009, Continental had total assets of $12.781 billion against total current liabilities of $4.389 billion; long-term debt and capital leases of $5.291 billion; deferred income taxes of $203 million; accrued pension liability of $1.248 billion; accrued retiree medical benefits of $216 million; and other liabilities of $844 million. At December 31, 2009, the Company had accumulated deficit of $442 million, accumulated other comprehensive loss of $1.185 billion and stockholders' equity of $590 million. The December 31 balance sheet showed strained liquidity: Continental had total current assets of $4.373 billion against total current liabilities of $4.389 billion. * * * As reported by the Troubled Company Reporter on September 4, 2009, Standard & Poor's Ratings Services lowered its issue-level ratings on all senior unsecured debt of Continental to 'CCC+' from 'B-' and revised the recovery ratings on certain unsecured debt issues, excluding industrial revenue bonds, to '6' from '5'. At the same time, S&P affirmed its 'B' corporate credit rating and secured debt ratings on Continental. The ratings on Continental's unsecured debt are based principally on declining aircraft values caused by the global aviation downturn. This could result in reduced asset protection for unsecured creditors if Continental were to file for bankruptcy. Continental continues to carry Moody's Investors Service's B2 corporate family and Fitch Ratings' 'B-' Issuer Default Rating and 'CC/RR6' from 'CCC/RR6' senior unsecured rating. CORUS BANKSHARES: Mulling Bankruptcy, To Spar with FDIC on Refunds ------------------------------------------------------------------ Corus Bankshares Inc. said in a March 8 regulatory filing that Chapter 11 or liquidation are among the alternatives being considered. Corus is a holding company whose bank was taken over by regulators and the Federal Deposit Insurance Corp. in September. In a filing with the Securities and Exchange Commission, Corus said, "Management is investigating alternatives for the Company's future, including, but not limited to, reorganization under Chapter 11, liquidation and the dissolution and winding up of the Company. Given the Company's outstanding obligations and other contingencies, the Company presently does not believe that there will be any assets remaining to be distributed to its common shareholders." Preliminary Results Corus Bankshares reported a preliminary net loss from continuing operations for the three months ended September 30, 2009 of $8.5 million, or $0.16 per diluted share, compared with a net loss from continuing operations of $6.9 million, or $0.13 per diluted share, for the same period of 2008. For the nine months ended September 30, 2009, the preliminary net loss from continuing operations was $17.7 million, or $0.33 per share on a diluted basis, compared to a net loss from continuing operations of $2.6 million, or $0.05 per share on a diluted basis in 2008. Due to a onetime, non-cash accounting gain of $251.9 million generated by writing off the Company's negative investment in the Bank, the Company reported preliminary net income for the three months ended September 30, 2009 of $210.0 million, or $3.91 per diluted share, compared with a net loss of $128.0 million, or $2.38 per diluted share, for the same period of 2008. For the nine months ended September 30, 2009, the preliminary net loss was $588.8 million, or $10.96 per share on a diluted basis, compared to a net loss of $139.7 million, or $2.57 per share on a diluted basis in 2008. Management expects that the Company will generate net losses going forward. Shareholders' deficit stood at $5.81 per share as of September 30, 2009. The Company has a $155 million taxes receivable on its balance sheet as of September 30, 2009. This amount represents tax refunds due from the IRS of $109 million for 2008 and $46 million for the first nine months of 2009. These refunds relate to the carryback of net operating losses to 2006 and 2007. On February 2, 2010, the Company filed amended returns for years 2006 and 2007 requesting the $109 million tax refund for 2008. Because the Company's consolidated tax loss in 2008 was generated principally by the Bank, the Company believes the Bank has a claim against the Company for the 2008 refund. Accordingly, the Company has recorded a payable to the FDIC, in its capacity as receiver of the Bank, for the 2008 refund, in the amount of $109 million. The Company will contest any claim by the FDIC for the 2008 refund because it believes that the tax refund will be generally subject to the claims of all of the Company's creditors, including the FDIC and is payable first to the Company, as the consolidated filer. The Company expects to accrue additional amounts due from the IRS of approximately $106 million in the fourth quarter of 2009 relating to the carryback of NOL's to 2004 and 2005. Recent carryback legislation was approved in November 2009 allowing taxpayers to carry back losses for five years instead of the current two years. Consequently, the Company anticipates requesting an aggregate tax refund of $152 million for 2009. Because the Company generated significant losses in 2009, the Company will contest any claim by the FDIC with respect to the 2009 refund, even though the Bank also generated significant losses in 2009. Where both the Company and the Bank have independent losses supporting independent claims for the entire refund, Treasury Regulations provide that the utilization of those losses should be apportioned based on each entity's respective loss. The Company expects the FDIC, in its capacity as receiver for the Bank, to assert a claim for some or all of the 2009 refund. Such claim could include an action by the FDIC to seek to have the IRS pay the refund directly to the FDIC. The Company believes that the tax refund will be generally subject to the claims of all of the Company's creditors, including the FDIC. The Company has not recorded a payable to the FDIC for any of the 2009 refund because of the independent loss by the Company giving rise to an independent claim for the entire 2009 refund. At this point in time, it cannot be reasonably determined how this matter will ultimately be resolved. A copy of a document containing the Company's preliminary financial statements is available for free at: http://researcharchives.com/t/s?5812 About Corus Bank Corus Bank, N.A., was the banking subsidiary of Chicago, Illinois- based Corus Bankshares, Inc. (NASDAQ: CORS). Corus Bank was closed September 11, 2009, by regulators and the Federal Deposit Insurance Corporation was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with MB Financial Bank, National Association, Chicago, Illinois, to assume all of the deposits of Corus Bank. As of June 30, 2009, Corus Bank had total assets of $7 billion and total deposits of approximately $7 billion. MB Financial Bank paid the FDIC a premium of 0.2% to assume all of the deposits of Corus Bank. MB Financial Bank agreed to purchase $3 billion of the assets, comprised mainly of cash and marketable securities. The FDIC retained the remaining assets for later disposition. CYTOMEDIX INC: Posts $566,627 Net Loss in Q3 2009 ------------------------------------------------- Cytomedix, Inc., filed its annual report on Form 10-Q, showing a net loss of $566,627 on $538,313 of revenue for the three months ended Septmeber 30, 2009, compared with a net loss of $802,969 on $499,371 of revenue for the same period of 2008. The Company's balance sheet as of September 30, 2009, showed $3.6 million in assets, $1.1 million of debts, and $2.6 million of stockholders' equity. Since inception, the Company has incurred, and continues to incur, significant losses from operations. The Company plans to obtain additional capital, to finance the development of its business operations, through strategic collaborations, issuance of its equity securities, grant funding, or any other means it deems appropriate. "There is no assurance that such capital will be available on acceptable terms or at all. As a result, there is substantial doubt as to the Company's ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?5798 Rockville, Md.-based Cytomedix, Inc. develops, sells, and licenses regenerative biological therapies, to primarily address the areas of wound care, inflammation, and angiogenesis. DENNY HECKER: Lack of Funds Forces Two Defense Counsel to Resign ---------------------------------------------------------------- Dee DePass at Star Tribune reports that Denny Hecker's two defense attorneys have resigned. "I don't have the money, so they both resigned," Mr. Hecker said, according to the report. Star Tribune says U.S. Magistrate Judge Susan Nelson executed an order Friday excusing Bill Mauzy from Mr. Hecker's criminal case. His other defense attorney, Marsh Halberg, also asked Judge Nelson to be removed from the criminal case Friday. According to Star Tribune, Mr. Hecker said he will have to get a public defender. Star Tribune also relates Mr. Hecker told the state judge handling his divorce case that he was having a hard time coming up with the cash to pay Ms. Mauzy. Mr. Hecker asked the divorce court if he could get back $100,000 of the $125,000 he recently used to replenish a 401(k) account he liquidated without the permission of the court or his ex-wife, Tamitha. The judge denied the request, the report says. About Denny Hecker Denny Hecker filed for Chapter 7 bankruptcy on June 4, 2009, before the U.S. Bankruptcy Court for the District of Minnesota. Mr. Hecker listed $18 million in assets and $767 million in debts owed to automakers, lenders, business partners and former employees. According to the Star Tribune in Minneapolis-St. Paul, the bankruptcy filing had been widely anticipated. Star Tribune noted Mr. Hecker has been forced to sell or close 25 of his 26 dealerships in recent months, and Chrysler Financial won a $477 million court judgment against him in April. The bankruptcy filing temporarily halted efforts by Chrysler and other creditors from collecting money they say they are owed. The Troubled Company Reporter on November 20 said Bankruptcy Judge Robert Kressel held Mr. Hecker in contempt of court for failing to turn over his financial records in a timely manner. William R. Skolnick, Esq., at Skolnick & Shiff, P.A., in Minneapolis, represents Mr. Hecker. DUANE READE: Denis Nayden Resigns from Board of Directors --------------------------------------------------------- Duane Reade Holdings Inc. received a letter from Denis J. Nayden informing the latter's resignation from the Board of Directors effective Feb. 24, 2010. Mr. Nayden had served as a Director on the Board and was Acting Chairman of the Compensation Committee of the Board of Directors. In tendering his resignation, Mr. Nayden did not express any disagreement with the Company on any matter relating to its operations, policies or practices. On March 4, 2010, the Board of Directors designated Tyler J. Wolfram to be the Chairman of the Compensation Committee and appointed Michael S. Green to serve as a member of the Compensation Committee. About Duane Reade Founded in 1960, Duane Reade is the largest drug store chain in New York City, offering a wide variety of prescription and over- the-counter drugs, health and beauty care items, cosmetics, convenience foods, greeting cards and photofinishing. As of June 27, 2009, the Company operated 253 stores. At September 26, 2009, Duane Reade Holdings, Inc., had $725,237,000 in total assets against $867,282,000 in total liabilities, resulting in stockholders' deficit of $142,045,000. * * * The Troubled Company Reporter said July 17, 2009, that Moody's Investors Service affirmed Duane Reade's Caa1 Corporate Family Rating and Ca Probability of Default Rating. Duane Reade's Caa1 CFR reflects the company's high leverage and weak coverage along with its geographic concentration in and disproportionate exposure to economic conditions in the intensely competitive New York metro market. The rating also incorporates Moody's expectation that free cash flow will be weak over the next 12 months due to relatively modest cash flow that is largely consumed by capital expenditures. DUBAI WORLD: Unit Surrenders Former Knickerbocker Hotel to Lender ----------------------------------------------------------------- The Wall Street Journal's A.D. Pruitt and Craig Karmin report that Istithmar World Capital, the private-equity arm of Dubai World, turned over the former Knickerbocker Hotel near the heart of Times Square to its lender, Danske Bank A/S, after defaulting on its $300 million mortgage. The report says the 300,000-square-foot building at 42nd and Broadway has been operated as an office building known as 1466 Broadway. The Journal says Istithmar emptied it of most of tenants as part of a plan to convert it back into a hotel. According to the report, Danske Bank has hired Jones Lang LaSalle to market the property and is getting a lot of interest, said Ben Singer a Jones Lang LaSalle broker. People familiar with the matter told the Journal among the interested bidders is Sitt Asset Management, the New York real-estate company that sold Istithmar the building in 2006. About Dubai World Dubai World -- http://www.dubaiworld.ae/-- is Dubai's flag bearer in global investments. As a holding company it operates a highly diversified spectrum of industrial segments and plays a major role in the emirate's rapid economic growth. Dubai World's investment spans four strategic growth areas of 21st Century commerce namely, Transport & Logistics, Drydocks & Maritime, Urban Development and Investment & Financial Services. Dubai World's portfolio includes DP World, one of the largest marine terminal operators in the world; Drydocks World & Dubai Maritime City designed to turn Dubai into a major ship-building and maritime hub; Economic Zones World which operates several free zones around the world including Jafza and TechnoPark in Dubai; Nakheel the property developer behind iconic projects such as The Palm Islands and The World among others; Limitless the international real estate master planner with current development projects in various parts of the world; Leisurecorp a global sports and leisure investment group, reshaping the industry by unlocking value across investment, development and brand opportunities; Dubai World Africa which oversees the regional development and portfolio of investments in the African continent; and Istithmar World, the group's investment arm that has a global footprint in finance, capital, leisure, aviation and various other business ventures. The Sun Never Sets on Dubai World, its Web site says. DUBAI WORLD: Nakheel Valuation Delays Final Debt Plan ----------------------------------------------------- Reuters reports bankers said on Sunday that Dubai World expects to put its debt plan to creditors as early as this week but the final proposal is being delayed by efforts to accurately value developer Nakheel's assets. According to Reuters, one of the bankers said Dubai World's plan for repaying $26 billion in debt will not include a proposal to raise capital or contain any surprises such as the repayment of Nakheel's Islamic bond in December after a last-minute bailout by Abu Dhabi. Reuters says valuing Nakheel's assets and determining the size of any financial help from the Dubai and Abu Dhabi governments would determine the size of the haircuts creditors would have to take. Reuters says Dubai is unable to contribute much while Abu Dhabi will be selective in its aid. Reuters notes Nakheel has a $980 million bond due in May, after the defacto standstill period announced in November ends, but is expected to be part of the broader Dubai World restructuring. The bond's underlying assets are the revenue stream that developed projects would eventually generate, and not the land it owns, Reuters adds. 6-Month Standstill In November 2009, the Troubled Company Reporter ran a story about Dubai World seeking a six-month standstill on its debt obligations. The government of Dubai said it would restructure Dubai World and has appointed Deloitte LLP to lead the restructuring effort, naming an executive at the consultancy as the group's "chief restructuring officer." Bloomberg News' Arif Sharif and Laura Cochrane said Dubai World has US$59 billion in liabilities. Bloomberg said Dubai accumulated US$80 billion of debt by expanding in banking, real estate and transportation before credit markets seized up last year. The Wall Street Journal said Standard & Poor's in an October report estimated Dubai World could be responsible for as much as 50% of Dubai's total government and corporate debt load of some US$80 billion to US$90 billion. Large Exposure As reported by the Troubled Company Reporter-Europe on Dec. 1, 2009, The Wall Street Journal's Chip Cummins, Dana Cimilluca and Sara Schaefer Munoz, citing a person familiar with the matter, said that U.K.'s Royal Bank of Scotland Group PLC, HSBC Holdings PLC, Barclays PLC, Lloyds Banking Group PLC, Standard Chartered PLC and ING Groep NV of the Netherlands, are among the international banks that have large exposure in Dubai World. RBS has lent roughly US$1 billion to Dubai World, another person said, according to the Journal. Sources also told the Journal Barclays's exposure to Dubai World is roughly US$200 million, and that exposure is effectively hedged. David Robertson at The (U.K) Times reported Credit Suisse has estimated that European banks could have EUR40 billion (GBP36 billion) in loans to Dubai and much of this could be at risk if the Gulf emirate defaults. The Journal, citing people familiar with the matter, said the banks with the greatest exposure to Dubai World are Abu Dhabi Commercial Bank and Emirate NBD PJSC, people familiar with the matter said. Dow Jones Newswires' Margot Patrick related that a report by the Emirates Banks Association said the top eight foreign banks in the United Arab Emirates by lending volume -- HSBC, Standard Chartered, Barclays, HSBC, Royal Bank of Scotland's ABN Amro, Citigroup Inc., BNP Paribas SA, Lloyds and Credit Agricole SA's Calyon, -- extended about US$36 billion in loans in 2008 throughout the federation, without breaking down the loans by emirate or type of borrower. About Dubai World Dubai World -- http://www.dubaiworld.ae/-- is Dubai's flag bearer in global investments. As a holding company it operates a highly diversified spectrum of industrial segments and plays a major role in the emirate's rapid economic growth. Dubai World's investment spans four strategic growth areas of 21st Century commerce namely, Transport & Logistics, Drydocks & Maritime, Urban Development and Investment & Financial Services. Dubai World's portfolio includes DP World, one of the largest marine terminal operators in the world; Drydocks World & Dubai Maritime City designed to turn Dubai into a major ship-building and maritime hub; Economic Zones World which operates several free zones around the world including Jafza and TechnoPark in Dubai; Nakheel the property developer behind iconic projects such as The Palm Islands and The World among others; Limitless the international real estate master planner with current development projects in various parts of the world; Leisurecorp a global sports and leisure investment group, reshaping the industry by unlocking value across investment, development and brand opportunities; Dubai World Africa which oversees the regional development and portfolio of investments in the African continent; and Istithmar World, the group's investment arm that has a global footprint in finance, capital, leisure, aviation and various other business ventures. The Sun Never Sets on Dubai World, its Web site says. DUBAI WORLD: Nakheel Valuation Delays Final Debt Plan ----------------------------------------------------- Reuters reports bankers said on Sunday that Dubai World expects to put its debt plan to creditors as early as this week but the final proposal is being delayed by efforts to accurately value developer Nakheel's assets. According to Reuters, one of the bankers said Dubai World's plan for repaying $26 billion in debt will not include a proposal to raise capital or contain any surprises such as the repayment of Nakheel's Islamic bond in December after a last-minute bailout by Abu Dhabi. Reuters says valuing Nakheel's assets and determining the size of any financial help from the Dubai and Abu Dhabi governments would determine the size of the haircuts creditors would have to take. Reuters says Dubai is unable to contribute much while Abu Dhabi will be selective in its aid. Reuters notes Nakheel has a $980 million bond due in May, after the defacto standstill period announced in November ends, but is expected to be part of the broader Dubai World restructuring. The bond's underlying assets are the revenue stream that developed projects would eventually generate, and not the land it owns, Reuters adds. 6-Month Standstill In November 2009, the Troubled Company Reporter ran a story about Dubai World seeking a six-month standstill on its debt obligations. The government of Dubai said it would restructure Dubai World and has appointed Deloitte LLP to lead the restructuring effort, naming an executive at the consultancy as the group's "chief restructuring officer." Bloomberg News' Arif Sharif and Laura Cochrane said Dubai World has US$59 billion in liabilities. Bloomberg said Dubai accumulated US$80 billion of debt by expanding in banking, real estate and transportation before credit markets seized up last year. The Wall Street Journal said Standard & Poor's in an October report estimated Dubai World could be responsible for as much as 50% of Dubai's total government and corporate debt load of some US$80 billion to US$90 billion. Large Exposure As reported by the Troubled Company Reporter-Europe on Dec. 1, 2009, The Wall Street Journal's Chip Cummins, Dana Cimilluca and Sara Schaefer Munoz, citing a person familiar with the matter, said that U.K.'s Royal Bank of Scotland Group PLC, HSBC Holdings PLC, Barclays PLC, Lloyds Banking Group PLC, Standard Chartered PLC and ING Groep NV of the Netherlands, are among the international banks that have large exposure in Dubai World. RBS has lent roughly US$1 billion to Dubai World, another person said, according to the Journal. Sources also told the Journal Barclays's exposure to Dubai World is roughly US$200 million, and that exposure is effectively hedged. David Robertson at The (U.K) Times reported Credit Suisse has estimated that European banks could have EUR40 billion (GBP36 billion) in loans to Dubai and much of this could be at risk if the Gulf emirate defaults. The Journal, citing people familiar with the matter, said the banks with the greatest exposure to Dubai World are Abu Dhabi Commercial Bank and Emirate NBD PJSC, people familiar with the matter said. Dow Jones Newswires' Margot Patrick related that a report by the Emirates Banks Association said the top eight foreign banks in the United Arab Emirates by lending volume -- HSBC, Standard Chartered, Barclays, HSBC, Royal Bank of Scotland's ABN Amro, Citigroup Inc., BNP Paribas SA, Lloyds and Credit Agricole SA's Calyon, -- extended about US$36 billion in loans in 2008 throughout the federation, without breaking down the loans by emirate or type of borrower. About Dubai World Dubai World -- http://www.dubaiworld.ae/-- is Dubai's flag bearer in global investments. As a holding company it operates a highly diversified spectrum of industrial segments and plays a major role in the emirate's rapid economic growth. Dubai World's investment spans four strategic growth areas of 21st Century commerce namely, Transport & Logistics, Drydocks & Maritime, Urban Development and Investment & Financial Services. Dubai World's portfolio includes DP World, one of the largest marine terminal operators in the world; Drydocks World & Dubai Maritime City designed to turn Dubai into a major ship-building and maritime hub; Economic Zones World which operates several free zones around the world including Jafza and TechnoPark in Dubai; Nakheel the property developer behind iconic projects such as The Palm Islands and The World among others; Limitless the international real estate master planner with current development projects in various parts of the world; Leisurecorp a global sports and leisure investment group, reshaping the industry by unlocking value across investment, development and brand opportunities; Dubai World Africa which oversees the regional development and portfolio of investments in the African continent; and Istithmar World, the group's investment arm that has a global footprint in finance, capital, leisure, aviation and various other business ventures. The Sun Never Sets on Dubai World, its Web site says. E*TRADE FIN'L: Faces Lindsay Lohan Suit Over TV Ad -------------------------------------------------- The Wall Street Journal's Ashby Jones reports that actress Lindsay Lohan has sued an arm of E*Trade Financial Corp. alleging the company misappropriated her name and personality in a recent television advertisement. The suit, filed in state court in Mineola, N.Y., on Monday, seeks $100 million in damages and demands that the company stop airing the ad, the Journal says. The Journal describers the 30-second commercial: "a baby boy chatting online through a Web cam with a baby girl, but in the voices and vernacular of a flirtatious much-older couple. After the boy explains why he failed to call the girl the night before, the girl asks the boy, accusingly: 'And that milkaholic, Lindsay, wasn't over?' That prompts a second baby girl, presumably 'Lindsay,' to jump in the frame on the boy's side. 'Milk-a-what?' she asks into the camera, her voice loud and shrill." According to the Journal, the lawsuit alleges that the depiction of the second girl "disregarded and violated" Ms. Lohan's right "to the exclusive control of the commercial use of her likeness, name, characterization and personality." It also alleges violations of two sections of New York's civil rights law. The Journal relates Ms. Lohan's lawyer, Stephanie Ovadia, Esq., said that since the filing of the suit, she's heard from many people willing to help her prove her case. "They've said that Lindsay [Lohan] was the first person they thought of when they saw the commercial," Ms. Ovadia said, according to the Journal. "People seem very willing to help." About E*TRADE The E*TRADE FINANCIAL (NASDAQ: ETFC) family of companies provides financial services including trading, investing and related banking products and services to retail investors. Securities products and services are offered by E*TRADE Securities LLC (Member FINRA/SIPC). Bank products and services are offered by E*TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries. * * * The Company's current senior debt ratings are Caa3 by Moody's Investor Service, CC/CCC-(3) by Standard & Poor's and B (high) by Dominion Bond Rating Service. The Company's long-term deposit ratings are Ba3 by Moody's Investor Service, CCC+ (developing) by Standard & Poor's and BB by DBRS. EAST CAMERON: U.S. Trustee Amends Creditors Committee Composition ----------------------------------------------------------------- R. Michael Bolen, the U.S. Trustee for Region 5, amended, for the second time, the members of the official committee of unsecured creditors in the Chapter 11 cases of East Cameron Partners, LP. The U.S. Trustee stated that Don Giallanza of Halliburton Energy Services, Inc. substituted Tony Singer, who is no longer employed by Halliburton. Teodoro Alban of Seahawk Drilling, Inc. substituted Steven Oldham of Pride Offshore, Inc. The change is a result of the reincorporation of Pride Offshore, Inc. into Seahawk Drilling, Inc. The Creditors Committee now consists of: 1. Halliburton Energy Services, Inc. Attn: Donald Giallanza 10200 Bellaire Blvd., 2SE-26A Houston, TX 77072-5299 Tel: (281) 988-2186 2. Abdon Callais Offshore, L.L.C. Attn: Bill Foret 1300 North Alex Plaisance Blvd. P.O. Box 727 Golden Meadow, LA 70357 Tel: (800) 632-3411 3. Seahawk Drilling, Inc. fka Pride Offshore, Inc. Attn: Teodoro Alban 5 Greenway Plaza, Suite 2700 Houston, TX 77046 Tel: (713) 369-7326 4. Candy Fleet Corporation Attn: Kenneth I. Nelkin P.O. Box 2444 Morgan City, LA 70381 Tel: (985) 384-5835 Fax: (985) 384-2721 5. Energy Cranes, LLC Attn: William R. Williams 6707 Northwinds Drive Houston, TX 77041 Tel: (713) 896-0002 Fax: (713) 896-5105 Official creditors' committees have the right to employ legal and accounting professionals and financial advisors, at the Debtor's expense. They may investigate the Debtor's business and financial affairs. Importantly, official committees serve as fiduciaries to the general population of creditors they represent. Those committees will also attempt to negotiate the terms of a consensual Chapter 11 plan -- almost always subject to the terms of strict confidentiality agreements with the Debtors and other core parties-in-interest. If negotiations break down, the Committee may ask the Bankruptcy Court to replace management with an independent trustee. If the Committee concludes reorganization of the Debtor is impossible, the Committee will urge the Bankruptcy Court to convert the Chapter 11 cases to a liquidation proceeding. Based in Lafayette, Louisiana, East Cameron Partners, LP -- http://www.eastcameronpartners.com/-- is an independent oil and gas exploration and production company. The Company filed for Chapter 11 relief on Oct. 16, 2008 (Bankr. W.D. La. Case No. 08-51207). Benjamin W. Kadden, Esq., Christopher T. Caplinger, Esq., and Stewart F. Peck, Esq., at Lugenbuhl, Wheaton, Peck, Rankin & Hubbard, represent the Debtor as counsel. Michael H. Piper, Esq., and William E. Steffes, Esq., at Steffes, Vingiello & McKenzie, L.L.C., represent the Official Committee of Unsecured Creditors as counsel. When the Debtor filed for protection from its creditors, it listed over $100 million each in assets and debts. ELA LLC: Voluntary Chapter 11 Case Summary ------------------------------------------ Debtor: ELA, LLC 5314 Baltimore Avenue Chevy Chase, MD 20815 Bankruptcy Case No.: 10-00213 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court United States Bankruptcy Court for the District of Columbia (Washington, D.C.) Debtor's Counsel: Steven H. Greenfeld, Esq. Cohen, Baldinger & Greenfeld LLC 7910 Woodmont Avenue, Ste. 1103 Bethesda, MD 20814 Tel: (301) 881-8300 Fax: (301) 881-8350 Email: steveng@cohenbaldinger.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Bekir Gunes, managing member of the Company. EMMIS COMMUNICATIONS: Dimensional Holds 5.49% of Class A Shares --------------------------------------------------------------- Austin, Texas-based Dimensional Fund Advisors LP disclosed that as of December 31, 2009, it may be deemed to hold 1,756,575 shares or roughly 5.49% of the Class A common stock of Emmis Communications Corporation. Headquartered in Indianapolis, Indiana, Emmis Communications Corporation owns and operates radio stations and magazine publications in the U.S. and in Europe. As of November 30, 2009, the Company had $513,406,000 in total assets against $497,070,000 in total liabilities and $140,459,000 in Series A Cumulative Convertible Preferred Stock. As of November 30, the Company had accumulated deficit of $697,805,000 and total shareholders' deficit of $173,894,000. * * * As reported by the Troubled Company Reporter on June 22, 2009, Moody's Investors Service changed Emmis Communications' senior secured term loan rating to Caa2 from Ca following the completion of a series of Dutch auction transactions pursuant to a March 3, 2009 credit facility amendment. The revised rating reflects the Company's capital structure, pro-forma for an roughly $78 million reduction of term loan debt which has resulted from these transactions. In addition, Moody's removed the "/LD" designation previously appended to the Probability of Default rating on April 27, 2009. In April, Moody's cut its corporate family rating on the Company to 'Caa2'. In May, S&P raised its corporate credit rating on the Company to 'CCC+'. In June, S&P withdrew the 'CCC+' Corp. Credit Rating at the Company's request. EMMIS COMMUNICATIONS: Amalgamated Holds 9.3% of Class A Shares -------------------------------------------------------------- Amalgamated Gadget, L.P., disclosed that as of December 31, 2009, it may be deemed to be the beneficial owner of 3,123,548 shares, which constitutes 9.3%, of the Class A common stock of Emmis Communications Corporation. Amalgamated said the shares held include 1,627,348 shares of Class A Common Stock obtainable upon conversion of 667,050 shares of 6.25% Series A Preferred Stock. The Preferred Stock has a conversion price of $20.495 per share and a liquidation value of $50.00 per share. Amalgamated said 1,496,200 of the shares were purchased for and on behalf of R2 Investments, LDC, pursuant to an Investment Management Agreement. Headquartered in Indianapolis, Indiana, Emmis Communications Corporation owns and operates radio stations and magazine publications in the U.S. and in Europe. As of November 30, 2009, the Company had $513,406,000 in total assets against $497,070,000 in total liabilities and $140,459,000 in Series A Cumulative Convertible Preferred Stock. As of November 30, the Company had accumulated deficit of $697,805,000 and total shareholders' deficit of $173,894,000. * * * As reported by the Troubled Company Reporter on June 22, 2009, Moody's Investors Service changed Emmis Communications' senior secured term loan rating to Caa2 from Ca following the completion of a series of Dutch auction transactions pursuant to a March 3, 2009 credit facility amendment. The revised rating reflects the Company's capital structure, pro-forma for an roughly $78 million reduction of term loan debt which has resulted from these transactions. In addition, Moody's removed the "/LD" designation previously appended to the Probability of Default rating on April 27, 2009. In April, Moody's cut its corporate family rating on the Company to 'Caa2'. In May, S&P raised its corporate credit rating on the Company to 'CCC+'. In June, S&P withdrew the 'CCC+' Corp. Credit Rating at the Company's request. EMMIS COMMUNICATIONS: OppenheimerFunds No Longer Holds Shares ------------------------------------------------------------- New York-based OppenheimerFunds, Inc., disclosed that as of December 31, 2009, it no longer held shares of Emmis Communications Corporation's Class A Common Stock. Headquartered in Indianapolis, Indiana, Emmis Communications Corporation owns and operates radio stations and magazine publications in the U.S. and in Europe. As of November 30, 2009, the Company had $513,406,000 in total assets against $497,070,000 in total liabilities and $140,459,000 in Series A Cumulative Convertible Preferred Stock. As of November 30, the Company had accumulated deficit of $697,805,000 and total shareholders' deficit of $173,894,000. * * * As reported by the Troubled Company Reporter on June 22, 2009, Moody's Investors Service changed Emmis Communications' senior secured term loan rating to Caa2 from Ca following the completion of a series of Dutch auction transactions pursuant to a March 3, 2009 credit facility amendment. The revised rating reflects the Company's capital structure, pro-forma for an roughly $78 million reduction of term loan debt which has resulted from these transactions. In addition, Moody's removed the "/LD" designation previously appended to the Probability of Default rating on April 27, 2009. In April, Moody's cut its corporate family rating on the Company to 'Caa2'. In May, S&P raised its corporate credit rating on the Company to 'CCC+'. In June, S&P withdrew the 'CCC+' Corp. Credit Rating at the Company's request. ENDEAVOUR HIGHRISE: Wonmore Investing Nearly $2MM into Project -------------------------------------------------------------- Houston-based Wonmore Ltd. is investing nearly $2 million to renovate and repair the Endeavour Clear Lake luxury high-rise. Wonmore, a single purpose entity and partnership created for the acquisition of the property, purchased the remaining 44 condominiums in the Endeavour luxury high-rise on Clear Lake, located at 4821 NASA Parkway in Pasadena, Texas, for $9.5 million on December 16, 2009. "We have thoroughly assessed the Clear Lake luxury condominium high-rise, including any remaining damage from Hurricane Ike. The building is soundly engineered and of the highest quality. Our investment is focused on exceeding market standards and delivering a high-end offering that homeowners can feel confident about," said John Gilmore, co-founder and managing principal of Richmore Properties, L.L.C, the general partner managing Wonmore's investment. The developer of the tower, Endeavour Highrise L.P., filed for bankruptcy in May of 2009. In addition to the $9.5 million paid for the remaining condominiums, Wonmore has also covered the existing 2010 homeowner assessments, as well as the outstanding taxes owed on the building for 2008 and 2009. Nearly 60 percent of the $2 million invested in the property will go toward re-skinning the building with a G.E. Elastomeric paint designed to expand up to 400 percent and seal the structure. The roof is being upgraded and covered with a rubberized coating to repair damage from Hurricane Ike and provide additional protection against outdoor elements. A variety of upgrades are being made to all of the common areas inside the building, including the movie theater, hallways and lobby in addition to other interior architecture-related improvements. For the exterior, plans include adding security cameras, improving the landscape and hard- scape features, repairing the lighting system, and making upgrades to the docks and marina. Wonmore will also finish-out the penthouse and the other remaining units. "The vast majority of the funds will be allocated to repairing the common areas and exterior in addition to other upgrades to the building. We are also excited to complete the penthouse -- it offers magnificent views and will be a spectacular home," continued Gilmore. The 30-story condominium tower, designed by Houston-based EDI Architects, has 80 units between 1,278 and 7,533 square feet. With expansive views of Clear Lake and the Gulf of Mexico, the development offers residents a number of high-end features including a large, infinity-edge pool and private boat slips. Interior features include luxury, European-style finishes, 12-foot ceilings and spacious balconies perfect for taking in the complex's sweeping views. Units in the Clear Lake high-rise are to be marketed from $350,000 to $2.9 million. Gilmore anticipates the majority of repairs and upgrades will be completed by late spring. Classified as a single-asset, real estate company, Endeavour Highrise, L.P., filed for Chapter 11 on May 4, 2009 (Bnakr. S.D. Tex. Case No. 09-33151). Matthew Hoffman, Esq., at Law Offices of Matthew Hoffman, p.c., represents the Debtor in its restructuring effort. The petition says assets and debts range from $10 million to $50 million. ERICKSON RETIREMENT: Judge Denies Motion for Sec. 1104 Examiner --------------------------------------------------------------- Several mezzanine lenders have asked the Bankruptcy Court to appoint an examiner in the Chapter 11 cases of Erickson Retirement Communities LLC. The mezzanine lenders say Erickson needs an examiner for "evaluating the merits of pursuing the proposed auction" where the first bid will come from Redwood Capital Investors LLC. They say the sale and the reorganization plan to implement the transfer are "perhaps wholly illegal." Various parties, including Erickson Retirement and senior lenders, objected. Judge Stacey Jernigan of the United States Bankruptcy Court for the Northern District of Texas said in a ruling that she agrees with PNC Bank, National Association, that certain subordination agreements are enforceable in the Debtors' Chapter 11 cases pursuant to Section 510 of the Bankruptcy Code. In light of those agreements, the Court finds that Strategic Ashby Ponds Lender LLC and Strategic Concord Landholder, LP, lack standing and have contractually waived the right to seek an examiner in the Debtors' Chapter 11 cases. The Court holds that the Subordination Agreements are governed by Maryland law, which provides that subordination agreements are fully enforceable. The Subordination Agreements involve these transactions: * Concord Campus, LP, owed its senior lenders $70,000,000 under a Construction Loan Agreement. Strategic Concord Landholder, LP, thus entered into a Ground Lessor Tri-Party Agreement, as a condition to the Concord Senior Lenders' consent to an alleged conveyance of the collateral Land to Strategic Concord for $25,000,000, and leaseback of the same land under a ground lease. * Ashburn Campus, LLC, owed its senior lenders $125,000 under a Construction Loan Agreement. Strategic Ashby Ponds Lenders, LLC, entered into a Subordination and Standstill Tri-Party Agreement as a condition to the Ashburn Senior Lenders' consent to subordinate financing by Strategic Ashby Ponds for $50,000,000. Judge Jernigan opines that the Strategic Entities are sophisticated commercial entities who knowingly waived all legal and statutory rights that would be in conflict with their obligation to "stand still" until the Ashburn and Concord Project Lenders' indebtedness is paid in full. The Strategic Entities agreed not to file any actions or pursue any remedies to collect on their claims or enforce their rights, unless PNC Bank consents, the Court notes. Judge Jernigan thus finds that the Examiner Motion is tantamount to both a pursuit of a remedy and the commencement of an action that is aimed, ultimately, at collection of the Strategic Entities' claims. "The Examiner Motion in the context of the Debtors' Chapter 11 cases at this time is unmistakably aimed at slowing down the confirmation process and gaining leverage to enhance or create recoveries for the subordinated creditors," Judge Jernigan opines. It is not in the interest of creditors or the Debtors' estates to appoint an examiner in the Debtors' Chapter 11 cases, the Court asserts. There are no allegations of wrongdoing on the part of the Debtors, Judge Jernigan points out. In light of the Strategic Entities' desire that an examiner investigate and report to the Court on appropriate value allocation among the estates as to the sale proceeds, Judge Jernigan says she will have to make findings of fact on the allocation of sale proceeds as part of the Plan confirmation process in order to preserve the integrity of the separate estates. "However, there is no reason, why the multitude of experts involved in the Debtors' Chapter 11 cases cannot testify as to value and let the Court decide whether the Debtor' proposed allocation of value is appropriate. Bankruptcy courts do this often, and it is not generally necessary to have an examiner employed to opine for the court," Judge Jernigan avers. For those reasons, Judge Jernigan denies the Examiner Motion. A full-text copy of an 18-page Examiner Motion Memorandum of opinion and order dated March 5, 2010, is available for free at: http://bankrupt.com/misc/ERC_Mar5Opinion.pdf About Erickson Retirement The Baltimore, Maryland-based Erickson Retirement Communities LLC owns 20 continuing care retirement communities in 11 states. Among Erickson's 20 communities, eight are completed, 11 are open although in construction, and one is in development. They have 23,000 residents in total. Erickson, along with affiliates, filed for Chapter 11 on Oct. 19, 2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US) serves as counsel to the Debtors. BMC Group Inc. serves as claims and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also serving as investment and financial consultant. Alvarez & Marsal is serving as restructuring adviser. As of September 30, 2009, on a book value basis, ERC had approximately $2.7 billion in assets, including $2.2 billion of property and equipment, and $3.0 billion in liabilities. Liabilities include $195.8 million on the revolving credit, $347.5 million on construction credit, $64 million in accounts payable, $47.8 million in subordinate debt, and $475 million in purchase option deposits. Bankruptcy Creditors' Service, Inc., publishes Erickson Retirement Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Erickson Retirement Communities LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ERICKSON RETIREMENT: Set for April 13 Plan Confirmation Hearing --------------------------------------------------------------- Judge Stacey Jernigan of the United States Bankruptcy Court for the Northern District of Texas approved the Disclosure Statement accompanying the Fourth Amended Joint Plan of Reorganization of Erickson Retirement Communities, LLC and its debtor affiliates on March 8, 2010. Shortly before Judge Jernigan entered his ruling, the Debtors filed with the Court their Fourth Amended Plan and Disclosure Statement, also on March 8, to reflect changes that resolve the objections asserted against the Disclosure Statement. Fourth Amended Plan ERC Executive Vice President and General Counsel Gerald Doherty explains that the Fourth Amended Plan contains is a global compromise among the Debtors; their lenders and agents; HCP, Inc., HCP ER2, LP, HCP ER3, LP, and HCP,ER6, LP; MSRESS III Dallas Campus, L.P., and MSRESS III Denver Campus, LLC; the Official Committee of Unsecured Creditors; and the U.S. Trustee for Region 6. If the Plan, as proposed, is not adopted, then those parties may not support an alternative plan, he says. Specifically, the 4th Amended Plan contains these additional disclosures: * The Debtors seek to entitle a $9 million auction fee to ERC Investment Holdings, LLC, an entity formed by affiliates of Coastwood Senior Housing Partners, LLC, Kohlberg Kravis Roberts & Co., and Beecken Petty O'Keefe & Company, LLC, as an administrative expense claim. The Debtors intend to seek approval of the Auction Fee at the confirmation hearing on the Amended Plan. * The allocation of the $365 million purchase price to be paid by Redwood-ERC Senior Living Holdings, LLC, for substantially all of the Debtors' assets represents a holistic deal among the Debtors, the Lenders and their Agents. The Lenders and their Agents previously said they will not vote to support a deal that provides for allocations that differ from those set forth under the Amended Plan. * Under the HCP Settlement, the Debtors intend to fund an $8.2 million settlement payment, $6 million of which will come a transaction implementation pool or TIP and the remaining $2.2 million will come from Initial Entrance Deposits and Cash available at Warminster Campus, L.P. * Pursuant a Second Amended and Restated Master Purchase and Sale Agreement among the Debtors, the Debtor Landowners and certain Redwood Entities, the Cash Collateral, including certificates of deposit securing Erickson Construction LLC's and ERC's Letters of Credit, issued by PNC Bank, National Association, will be transferred to the Redwood Entities, subject to existing liens. * PNC Bank's claims on account of Letters of Credit issued to Littleton Campus LLC and Warminster Campus LLC will be deemed allowed as of the Plan Effective Date. Moreover, PNC Bank will not release its liens on those certificates of deposit pledged as collateral for the Littleton Campus, Warminster Campus and Erickson Construction LOCs except to the extent those LOCs are returned, undrawn, to PNC Bank. With respect to Erickson Construction LOC, after the release of certificates of deposit, those certificates will be deemed purchased assets. * Redwood Holdings will provide replacement collateral to secure letters of credit issued by PNC Bank to Novi Campus in exchange for release of existing collateral. * Holders of Claims arising under ERC's Growth Participation Plan may not participate as beneficiaries under a Liquidating Creditor Trust because pursuant to the Growth Participation Plan, payments under the Amended Plan are deferred until all outstanding obligations owed to the Debtors' lenders are paid in full. * Tier A Subclass Trade Claims will include the general unsecured claims held by current and former employees of the Debtors. * Holders of Subordinated Taxable Adjustable Mezzanine Put Securities Series or STAMPS may have claims, including rights of recission under applicable securities laws, which may be released under the Plan. Holders of STAMPS are advised to consult counsel if they desire analysis of those claims. * The Debtors previously filed a motion, seeking authority to pay prepetition employee severance benefits. The payments, which would have been made under the Severance Motion, will be made under the Amended Plan. The Debtors say they are investigating whether other or further relief may be available. * To the extent any party holds valid consent rights with regards to New Management Agreements contemplated under the 4th Amended Plan, those rights will continue to be enforceable. Modified Claims Treatment The 4th Amended Plan modifies the class name, treatment and recovery of certain claims: * The recovery for ERC Class 3 Corporate Revolver Claims and Interest Rate Swap Claims are each reduced from 50.6% to 49.4%. * The treatment of Erickson Construction Class 3 Mechanic's Lien Claims is changed to impaired, such Class Claim is deemed to reject the Amended Plan. Moreover, the recovery for Erickson Construction Class 3 Mechanic's Lien Claims is amended from 100% to 0% under the Amended Plan. * A Class 6 Letters of Credit Claims is added to Erickson Construction's classes of claims, having an unimpaired status, and is deemed to accept the Amended Plan. Erickson Construction Class 6 Claims is expected to have a 100% recovery. * Erickson Construction Class 7 is designated as General Unsecured Claims and Erickson Construction Class 8 is designated as Interests in Erickson Construction. * Holders of Ashburn Campus and Concord Campus Junior Loan Claims may receive a participation interest in the recoveries of the Liquidating Creditor Trust. * Holders of Columbus Campus LLC Class 5 Construction Loan Claims will retain their deficiency claims and participate in the Liquidating Creditor Trust. * To the extent Allowed Mechanic's Lien Claims are not paid in full, the unpaid portions of the Allowed Mechanic's Lien Claims will be treated as General Unsecured Claims and receive a Tier A Trade Class interest in the Liquidating Creditor Trust and receive distributions of a Trade Dividend under the Amended Plan. * Holders of Dallas Campus Class 4 Construction Loan Claims will receive 84.4% of the gross recovery realized from any Section 505 of the Bankruptcy Code action brought against the ad valorem taxing authorities with respect to Dallas Campus' real property, and will be paid from those proceeds either (i) directly from the ad valorem taxing authorities or (ii) from the Debtor or its successor. All amounts received by Bank of America, National Association, will be distributed by BofA, to the holders in accordance with Dallas Campus' Construction Loan documents and the Lender Allocation. BofA will release its lien against the assets of Dallas Campus upon receipt of the required payment. * Holders of Dallas Campus Class 5 Texas A&M Note Claim will receive (i) Cash for $3,440,000 on the Plan Effective Date, and (ii) 15.6% of the gross recovery realized from any Section 505 action brought against the ad valorem taxing authorities with respect to the Dallas Campus Real Property. * In the event a holder of Littleton Campus Class 2 Secured Tax Claim opts to either receive proceeds of the sale of the collateral securing its Secured Tax Claim or leave unaltered the rights to which it is entitled, that holder will receive interest on that Claim at a statutory rate of 12% per annum. The 4th Amended Plan also appends an estimate of the amount of Administrative Expense Claims and a summary of the allocation of the administrative expense costs among the specific Debtor estates, a full-text copy of which is available for free at: http://bankrupt.com/misc/ERC_AdminCostsAnalysis.pdf The 4th Amended Plan incorporates a list of current officers and directors of the Debtors to be employed by Redwood Holdings on the Effective Date through the 90-day anniversary of it, other than John Erickson and members of the Erickson family. A list of the Redwood Retained Employees is available for free at: http://bankrupt.com/misc/ERC_RedwoodRetainedEmps.pdf Full-text copies of the Erickson Retirement Fourth Amended Plan and Disclosure Statement dated March 8, 2010 are available for free at: http://bankrupt.com/misc/ERC_4thAmPlan.pdf http://bankrupt.com/misc/ERC_4thAmDS.pdf Blacklined versions of the Fourth Amended Plan and Disclosure Statement are available for free at: http://bankrupt.com/misc/ERC_4thAmDS_blacklined.pdf http://bankrupt.com/misc/ERC_4thAmPlan_blacklined.pdf Adequacy of the Disclosure Statement Upon review, Judge Jernigan ruled that the Disclosure Statement contains "adequate information" within the meaning of Section 1125 of the Bankruptcy Code. Any objections to the adequacy of the information contained in the Disclosure Statement not otherwise consensually resolved are overruled, Judge Jernigan said. A full-text copy of the Disclosure Statement Order is available for free at http://bankrupt.com/misc/ERC_Mar8DSOrder.pdf Solicitation Schedule Judge Jernigan also authorized the solicitation of votes for the Amended Plan in accordance with approved plan solicitation procedures and schedule. Judge Jernigan fixed March 5, 2010, as the record date for the purposes of determining the creditors and equity interest holders entitled to a receive a solicitation package or a non-voting status notice and to vote on the Amended Plan. Judge Jernigan directed BMC Group, Inc., the Debtors' voting agent, to mail or caused to be mailed to Holders of Claims entitled to vote on the Amended Plan no later than March 15, 2010, a solicitation package. All Ballots must be properly executed, completed and delivered to BMC Group at these addresses: ERC Ballot Processsing c/o BMC Group, Inc. P.O. Box 3020 Chanhassen, Minnesota 55317-3020 ERC Ballot Processing c/o BMC Group, Inc. 18750 Lake Drive East Chanhassen, Minnesota 55317 Ballots for the Plan must be received no later than April 8, 2010, at 4:00 p.m. for general creditors entitled to vote on the Plan, and no later than April 13, 2010, at 4:00 p.m. for STAMP Holders or at a date set by the Court. The Court also approved the procedures for establishing cure amounts for contracts to be assumed under the Amended Plan. Judge Jernigan will convene a hearing to consider confirmation of the Amended Plan on April 15, 2010. Objections to confirmation of the Amended Plan are due April 9, 2010. Any party supporting the Amended Plan may file a reply to any objection to confirmation of the Amended Plan no later than April 13. About Erickson Retirement The Baltimore, Maryland-based Erickson Retirement Communities LLC owns 20 continuing care retirement communities in 11 states. Among Erickson's 20 communities, eight are completed, 11 are open although in construction, and one is in development. They have 23,000 residents in total. Erickson, along with affiliates, filed for Chapter 11 on Oct. 19, 2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US) serves as counsel to the Debtors. BMC Group Inc. serves as claims and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also serving as investment and financial consultant. Alvarez & Marsal is serving as restructuring adviser. As of September 30, 2009, on a book value basis, ERC had approximately $2.7 billion in assets, including $2.2 billion of property and equipment, and $3.0 billion in liabilities. Liabilities include $195.8 million on the revolving credit, $347.5 million on construction credit, $64 million in accounts payable, $47.8 million in subordinate debt, and $475 million in purchase option deposits. Bankruptcy Creditors' Service, Inc., publishes Erickson Retirement Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Erickson Retirement Communities LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) ERICKSON RETIREMENT: WestSide Wants Lift Stay to Foreclose on Lien ------------------------------------------------------------------ Westside Mechanical Group, Inc., and Debtor Erickson Construction, LLC, as general contractor of the "Sedgebrook Construction Projects", entered into contracts, whereby Westside agreed to perform certain "heat, ventilation and air conditioning systems" work and other material work on the Construction Projects. The Construction Projects are known as the Sedgebrook Renaissance Gardens, the Sedgebrook Residential Building 1.4, and the Sedgebrook Residential Building 1.5. The Projects are owned by non-debtor Lincolnshire Campus LLC, and are located at 800 Audobon Way, and other addresses, in Lincolnshire, Illinois. Westside asserts that the Debtor failed and refused to pay it $551,569 for full performance under the Contracts. In accordance with Illinois law, Westside timely served a notice of lien and recorded its Subcontractor's Claim for Mechanics Lien with the Recorder of Deeds of Lake County, Illinois, in August 2009. Westside subsequently filed a lawsuit against the Debtor and Lincolnshire Campus, seeking foreclosure of its lien before the Circuit Court of the Nineteenth Judicial Circuit, Lake County, Illinois. In this light, Westside asks the United States Bankruptcy Court for the Northern District of Texas to allow it to continue to prosecute the Illinois Lawsuit so that it may ultimately foreclose its lien against Lincolnshire Campus. Joseph A. Friedman, Esq., at Kane Russell Coleman & Logan PC, in Dallas, Texas, insists that there is a need for Westside to prosecute and liquidate its claim against the Debtor in the Illinois Lawsuit in order for Westside to foreclose on its mechanics lien against Lincolnshire Campus. Unless the automatic stay is lifted, Westside will suffer extreme prejudice as it will effectively be prevented from pursuing the foreclosure of its mechanics lien against Lincolnshire Campus, he argues. On the contrary, the Debtor and its estate will suffer no prejudice if the automatic stay is lifted, Mr. Friedman contends. He further assures the Bankruptcy Court that Westside is not seeking a modification of the automatic stay to execute on or enforce any judgment against the Debtor or to foreclose on any property of the Debtor. About Erickson Retirement The Baltimore, Maryland-based Erickson Retirement Communities LLC owns 20 continuing care retirement communities in 11 states. Among Erickson's 20 communities, eight are completed, 11 are open although in construction, and one is in development. They have 23,000 residents in total. Erickson, along with affiliates, filed for Chapter 11 on Oct. 19, 2009 (Bankr. N.D. Tex. Case No. 09-37010). DLA Piper LLP (US) serves as counsel to the Debtors. BMC Group Inc. serves as claims and notice agent. Houlihan, Lokey, Howard & Zoukin, Inc., is also serving as investment and financial consultant. Alvarez & Marsal is serving as restructuring adviser. As of September 30, 2009, on a book value basis, ERC had approximately $2.7 billion in assets, including $2.2 billion of property and equipment, and $3.0 billion in liabilities. Liabilities include $195.8 million on the revolving credit, $347.5 million on construction credit, $64 million in accounts payable, $47.8 million in subordinate debt, and $475 million in purchase option deposits. Bankruptcy Creditors' Service, Inc., publishes Erickson Retirement Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Erickson Retirement Communities LLC and its debtor-affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) EVERYDAY LOGISTICS: Files Schedules of Assets & Liabilities ----------------------------------------------------------- Everyday Logistics LLC has filed with the U.S. Bankruptcy Court for the Southern District of New York its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------ ----------- A. Real Property $7,000,000 B. Personal Property $30,000 C. Property Claimed as Exempt D. Creditors Holding Secured Claims $25,633,500 E. Creditors Holding Unsecured Priority Claims $0 F. Creditors Holding Unsecured Non-priority Claims $769,349 ----------- ----------- TOTAL $7,030,000 $26,402,849 Monsey, New York-based Everyday Logistics LLC filed for Chapter 11 bankruptcy protection on January 7, 2010 (Bankr. S.D.N.Y. Case No. 10-22026). Mark A. Frankel, Esq., at Backenroth Frankel & Krinsky, LLP, assists the Company in its restructuring effort. The Company listed $1,000,001 to $10,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. F&M CONSTRUCTION: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: F&M Construction, LLC 104 Blake Place Bridgeport, WV 26330 Bankruptcy Case No.: 10-00454 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Northern District of West Virginia (Clarksburg) Judge: BK Patrick M. Flatley Debtor's Counsel: Thomas H. Fluharty, Esq. 408 Lee Avenue Clarksburg, WV 26301 Tel: (304) 624-7832 Fax: (304) 622-7649 Email: THFDEBTATTY@wvdsl.net Estimated Assets: Not Stated Estimated Debts: Not Stated The Debtor did not file a list of its 20 largest unsecured creditors when it filed its petition. The petition was signed by Ken Massie. FAIRVUE CLUB: Wants Until June 30 to Propose a Chapter 11 Plan -------------------------------------------------------------- Fairvue Club Properties, LLC, asks the U.S. Bankruptcy Court for the Middle District of Tennessee to extend its exclusive period to propose a plan until June 30, 2010. Absent the extension, the Debtor's exclusive period will expire on March 30. The Debtor relates that it needs additional time to generate revenues in order to reorganize. A hearing on the requested exclusivity extension is scheduled for March 23, 2010, at 9:00 a.m. at Courtroom 2, Second Floor, Customs house, 701 Broadway, Nashville, Tennessee. Gallatin, Tennessee-based Fairvue Club Properties, LLC, filed for Chapter 11 bankruptcy protection on December 1, 2009 (Bankr. M.D. Tenn. Case No. 09-13807). William L. Norton, III, Esq., at Bradley Arant Boult Cummings LLP assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. FEC LAFAYETTE: Case Summary & 15 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: FEC Lafayette, LLC 1811 Bering, Suite 400 Houston, TX 77075 Bankruptcy Case No.: 10-50287 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Western District of Louisiana (Lafayette/Opelousas) Debtor's Counsel: Douglas S. Draper, Esq. 650 Poydras St #2500 New Orleans, LA 70130 Tel: (504) 299-3300 Fax: (504) 299-3399 Email: ddraper@hellerdraper.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 A list of the Company's 15 largest unsecured creditors is available for free at: http://bankrupt.com/misc/lawb10-50287.pdf The petition was signed by Lloyd R. French III, manager of the company. Debtor-affiliates that filed separate Chapter 11 petitions: Petition Debtor Case No. Date ------ -------- ---- FEC OKC MacArthur, LLC 10-50288 3/8/10 Assets: $1 million to $10 million Debts: $1 million to $10 million FEC Sugarland, LP 10-50289 3/8/10 FEC Pasadena, LP 10-50290 3/8/10 FEC Euless, LP 10-50291 3/8/10 FEC El Paso, LP 10-50292 3/8/10 FIRST AMERICAN: Moody's Assigns 'Ba2' Rating on $500 Mil. Loan -------------------------------------------------------------- Moody's Investors Service has assigned a (P)Ba2 rating to The First American Corporation's Information Solutions Company's proposed $500 million revolving credit facility. This follows Moody's press release of March 4, 2010, when Moody's assigned ISC first-time (P)Ba2 corporate family and probability of default ratings, along with a (P)Ba2 rating for its proposed $350 Senior Secured Term Loan. The company's stable outlook remains unchanged. The provisional (P) ratings are prospective in nature and are based on the assumption that The First American Corporation completes the planned spin-off of its financial services businesses (mainly its title insurance and specialty insurance reporting segments) into a separate public company during 2010. Upon completion of the spin-off, the remaining First American company will be comprised of the Information Solutions business (referred to as ISC). ISC will have a capital structure consisting of a proposed $500 million secured credit facility and $350 million secured term loan. Assignment of definitive ratings will be subject to completion of the spin-off, a review of the final capital structure (including more detailed terms and conditions of the proposed debt instruments), the company's liquidity position and an assessment of its ability to remain in compliance with all terms and conditions governing the credit agreement (including financial maintenance covenants), and near- term financial performance of the company in light of 2010 expectations. The (P)Ba2 CFR reflects the company's leading market position within the mortgage settlement services market, long-standing relationships with several of the largest financial institutions, solid financial performance through economic cycles, and an increasingly diversified business model consisting of proprietary data analytics (e.g., loan performance and fraud detection) and risk mitigation services (e.g., credit services, employer services, and litigation support). The rating is constrained, however, by the company's high revenue concentration (approximately 70% real estate related), high customer concentration (with its top 10 clients accounting for about half of total revenue), and low geographic diversity (with substantially all of its revenue generated in the U.S.). A short-term speculative grade liquidity rating of (P)SGL-1 has also been assigned, reflecting ISC's very good internal and external liquidity following the spin-off, including an expected cash balance of about $460 million and cash flow from operations that should be more than sufficient to fund necessary capital expenditures, working capital requirements and mandatory debt amortization over the next twelve months. The company is expected to have external liquidity in the form of its $500 million revolving credit facility that expires in 2012, of which approximately $100 million is expected to be drawn at closing. However, in connection with the potential purchase of the remaining Experian interest in the First American Real Estate Solutions LLC joint venture during 2010, the company may incur additional debt related to the $318 million purchase price. Moody's expects the company to be adequately within, and maintain, compliance with its two financial covenants (a debt-to-EBITDA leverage test and a minimum debt service coverage test) for at least the next twelve months. The stable rating outlook reflects the company's solid operating performance amidst the economic downturn and weak housing market, supported by the strength of the company's customer base, its proprietary data assets, significant operating leverage, and the growing diversity of revenue streams outside of mortgage originations. In addition, the stable outlook considers Moody's expectation that management will maintain conservative financial policies with a leverage target not exceeding 3x on a sustained basis. These first-time ratings/assessments were assigned: * $500 Million Senior Secured Revolving Credit Facility due 2012 - -- (P)Ba2 (LGD-3, 42%) The last rating action on First American Information Solutions Company took place on March 4, 2010, when Moody's assigned a first-time corporate family rating, probability of default rating and proposed $350 Senior Secured Term Loan rating of (P)Ba2. Information Solutions Company, headquartered in Santa Ana, California, is a leading provider of property and mortgage data and analytics products and solutions. The company provides outsource solutions in mortgage risk analytics; property, credit and employment information. Revenues for the twelve months ended December 31, 2009, were approximately $2 billion. FIRST MAGNUS: Court Dismisses Fraud & Racketeering Allegations -------------------------------------------------------------- The Hon. James M. Marlar of the U.S. Bankruptcy Court of Tucson dismissed fraud and racketeering allegations against former First Magnus executives Karl Young, Thomas Sullivan Sr., Thomas Sullivan Jr. and Gurpreet Jaggi sought by a trustee on behalf of the company's creditor, according to Dale Quinn at Arizona Daily Star. According to the report, not all of the claims against the Company were dismissed. The complaint still alleges that some of the defendants hindered or delayed payment of funds in ways that worked to their financial gain. About First Magnus Based in Tucson, Arizona, First Magnus Financial Corporation -- http://www.firstmagnus.com/-- purchases and sells prime and Alt-A mortgage loans secured by one-to-four unit residences. The company filed for chapter 11 protection on Aug. 21, 2007 (Bankr. D. Ariz. Case No. 07-01578). John R. Clemency, Esq., at Greenberg Traurig LLP serves as the counsel for the Debtor. The Official Committee of Unsecured Creditors has selected the firm Warner Stevens LLP as its counsel. When the Debtor filed for bankruptcy, it listed total assets of $942,109,860 and total debts of $812,533,046. As of Dec. 31, 2007, the Debtor had total assets of $178,737,936 and total liabilities of $142,241,111. The Debtor's chapter 11 liquidation plan was approved in February 2008. FLINTKOTE CO: Aviva Can't Dodge Covering Flintkote Asbestos Suits ----------------------------------------------------------------- Law360 reports that a federal judge has denied Aviva Insurance Co. of Canada's request to reconsider an order declaring The Flintkote Co. a named insured under a policy issued to two of the company's Canadian subsidiaries in its suit to recover for asbestos-related personal injury cases. Headquartered in San Francisco, California, The Flintkote Company is engaged in the business of manufacturing, processing and distributing building materials. Flintkote Mines Limited is a subsidiary of Flintkote Company and is engaged in the mining of base-precious metals. The Flintkote Company filed for Chapter 11 protection on April 30, 2004 (Bankr. D. Del. Case No. 04-11300). Flintkote Mines Limited filed for Chapter 11 relief of August 25, 2004 (Bankr. D. Del. Case No. 04-12440). James E. O'Neill, Esq., Kathleen P. Makowswki, Esq., Laura Davis Jones, Esq., Sandra G.M, Selzer, Esq., and Scotta Edelen McFarland, Esq., at Pachulski Stang Ziehl & Jones LLP, represent the Debtors in their restructuring efforts. Kathleen Campbell Davis, Esq., and Mark T. Hurford, Esq., at Campbell & Levine, LLC, represent the official committee of unsecured creditors as counsel. When Flintkote Company filed for protection from its creditors, it listed more than $100 million each in assets and debts. When Flintkote Mines Limited filed for protection from its creditors, it listed assets of $1 million to $50 million, and debts of more than $100 million. FREEDOM COMMUNICATIONS: Court Approves Reorganization Plan ---------------------------------------------------------- Freedom Communications disclosed that the U.S. Bankruptcy Court has confirmed its Plan of Reorganization. The Company is working to clear the remaining Plan items with a target to emerge from Chapter 11 by the end of March. The Plan, which was supported by the Steering Committee of the Company's secured lenders and the Official Committee of Unsecured Creditors, and approved by an overwhelming majority of its voting creditors, eliminates approximately $450 million of debt from Freedom's balance sheet, giving the Company the flexibility and financial strength it needs to best serve all of its stakeholders. Upon emergence from Chapter 11, the Company will receive a $25 million revolving credit facility from General Electric Capital Corporation, as agent. This facility will ensure that the Company has adequate back-up liquidity upon emergence to meet its working capital needs. "Navigating through Chapter 11 as rapidly as we have is a remarkable achievement, testifying to the hard work of all involved," said Chief Executive Officer Burl Osborne. "We have worked closely with our major constituents to implement a plan that treats our stakeholders fairly while deleveraging the Company and positioning it for future success and meeting the challenges of the new media environment." In a separate but related action, the Court also approved the Company's sale of its Phoenix-area operations to 1013 Communications, LLC, an affiliate of Thirteenth Street Media. The sale is expected to close by the end of March, subject to satisfaction of the closing conditions. About Freedom Communications Freedom Communications, headquartered in Irvine, California, is a national privately owned information and entertainment company of print publications, broadcast television stations and interactive businesses. The company's print portfolio includes approximately 90 daily and weekly publications, including approximately 30 daily newspapers, plus ancillary magazines and other specialty publications. The broadcast company's stations -- five CBS, two ABC network affiliates and one CW affiliate -- reach more than 3 million households across the country. The Company's news, information and entertainment Web sites complement its print and broadcast properties. Freedom Communications filed for Chapter 11 on Sept. 1, 2009 (Bankr. D. Del. Case No. 09-13046). Attorneys at Young Conaway Stargatt & Taylor, and Latham & Watkins LLP serve as Chapter 11 counsel. Houlihan, Lokey, Howard & Zukin, Inc., serves as financial advisor while AlixPartners LLC is restructuring consultant. Logan & Co. serves as claims and notice agent. Freedom Communications had $757,000,000 in assets against debts of $1,077,000,000 as of July 31, 2009. GATEHOUSE MEDIA: Incurs $530.6 Million Net Loss for 2009 -------------------------------------------------------- GateHouse Media Inc. released its full-year 2009 results, reporting a net loss of $530.6 million for the year ended Dec. 31, 2009, from a net loss of $673.3 million in 2008. The Company's balance sheet at Dec. 31, 2009, showed $591.2 million in assets and $1.3 billion in liabilities, resulting to a $753.0 million stockholders' deficit. Fourth Quarter 2009 Total reported revenues were $150.2 million for the fourth quarter, a decline of 10.3% over the prior year. The decline in same-store revenue was driven primarily by print local and classified advertising categories, which were down 10.2% and 16.6%, respectively. Circulation revenues declined 3.6% for the quarter on a same-store basis. Commercial printing and other revenues declined 23.1% in the quarter on a same-store basis. Reported operating costs and SG&A expense were $121.5 million, a decline of $17.1 million or 12.3% from the prior year. Same-store operating costs and SG&A expense declined by 11.7% in the quarter, led primarily by declines in compensation and newsprint. The decrease in compensation expense reflects permanent cost reduction initiatives. In addition, declines in newsprint pricing and consumption contributed to a 39.0% reduction in newsprint expense. Although newsprint prices have begun to increase, the Company anticipates it will continue to benefit from year over year price declines during the first quarter of 2010. Reported operating income for the quarter was $16.1 million, an increase of 50.8% over the prior year quarter, excluding impairment charges. As Adjusted EBITDA for the quarter was $29.3 million, a decline of $1.6 million or 5.3% on a same-store basis from the prior year. The minor decline in As Adjusted EBITDA was primarily due to the decline in revenue which was offset by expense reduction initiatives. Levered Free Cash Flow for the quarter was $13.7 million compared with $9.4 million for the prior year, a 46.8% increase. Non-cash compensation expense for Restricted Stock Grants in the fourth quarter was $0.7 million. One-time costs incurred and other non-cash expenses in the quarter were $1.6 million, and related primarily to reorganization and expense control initiatives introduced to realize permanent expense savings. Commenting on GateHouse Media's results, Michael E. Reed, GateHouse Media's Chief Executive Officer, said, "As the economy began to stabilize throughout the year, we experienced continued improvement in our year over year revenue trends. Our fourth quarter same-store revenue declines were 10.5% compared to 14.9% in the third quarter. This trend has continued into our first quarter. "We continue to focus on permanent cost reduction initiatives. These programs were a significant contributor to a 10.7% expense decline in 2009, driven by an 11.0% decline in compensation expense. We are in the process of implementing additional cost saving initiatives in order to better align our overall cost structure with current revenue trends. "The improvement in revenue trends and our cost saving initiatives, combined with controlled capital spending, have resulted in improved cash flow and liquidity. Our Levered Free Cash Flow per share increased from $0.19 in the third quarter to $0.24 in the fourth quarter, and represented a fifty percent increase from fourth quarter 2008. We have significantly improved our working capital position over the course of 2009, which positions us well going into 2010." Full Year 2009 Total reported revenues were $585.0 million for the full year 2009, a decrease of 13.8% over the prior year. As Adjusted Revenues for the full year 2009 were $582.4 million, a decline of 14.2% on a same-store basis from the prior year. The decline in same-store revenue was driven primarily by the local advertising and print classified categories, which were down 12.1% and 29.5%, respectively, on a year over year basis. Circulation revenues decreased 2.8% on a same-store basis benefiting from price increases as volumes declined slightly. Commercial printing and other revenues were down 19.6% for the year on a same-store basis. Full year 2009 reported operating costs and SG&A expense declined $68.0 million or 12.0% compared to the prior year. Same-store operating costs and SG&A expenses declined by 10.7%, driven by an 11.0% decline in compensation expense. Expense declines in 2009 reflect permanent cost reduction initiatives implemented primarily in the first half of the year. In addition, declines in newsprint pricing and consumption resulted in a 23.4% reduction in newsprint expense. Reported operating loss for the full year 2009 was $454.5 million. Excluding the impairment charge associated with goodwill, mastheads and other long-lived assets recorded in the second quarter, operating income in 2009 was $26.9 million, compared to $32.9 million in 2008. As Adjusted EBITDA for the year was $91.0 million, a decrease of $37.5 million or 29.2% on a same- store basis, primarily due to the loss of revenue partially offset by expense reduction initiatives. Levered Free Cash Flow for the full year 2009 was $20.1 million compared to $33.8 million in 2008. Non-cash compensation expense for Restricted Stock Grants was $3.4 million for the year. One-time costs incurred and other non-cash expenses in 2009 were $6.0 million, and related primarily to reorganization and expense control initiatives to realize permanent expense savings. A full-text copy of the Company's announcement on its 2009 results is available for free at http://ResearchArchives.com/t/s?57c7 About GateHouse Media GateHouse Media, Inc. -- http://www.gatehousemedia.com/-- headquartered in Fairport, New York, is one of the largest publishers of locally based print and online media in the United States as measured by its 97 daily publications. GateHouse Media currently serves local audiences of more than 10 million per week across 21 states through hundreds of community publications and local Web sites. At Sept. 30, 2009, the Company had $601,666,000 in total assets against $1,350,478,000 in total liabilities. As reported by the Troubled Company Reporter on Sept. 21, 2009, Moody's downgraded GateHouse Media Operating, Inc.'s Corporate Family rating to "Ca" from "Caa1" and its Probability of Default rating to "Ca" from "Caa2", reflecting Moody's view of very high default risk and weakened recovery prospects for debtholders in an event of default scenario which is exacerbated by lingering adverse current market conditions. GENERAL GROWTH: Releases Operating Results for 2009 --------------------------------------------------- General Growth Properties, Inc., announced its operating results for the three and 12 months ending December 31, 2009. "The operating results we reported today demonstrate we are successfully executing our business strategy to create long-term value for our stakeholders," said Adam Metz, chief executive officer of General Growth Properties, on March 1. "Our operational focus continues to be providing the best consumer experience in our malls by investing in a high-quality physical environment and supporting the sales of our tenants. We are very pleased with the success of our merchandising strategy which has enabled the Company to complete significant transactions in 2009 with many of the world's leading retailers. We have maintained our high occupancy rate in part due to renewal activity and exciting openings like the Macy's at Visalia Mall and Nordstrom at Fashion Place and Kenwood Towne Centre. "At the same time, we have made prudent financial decisions to respond to challenging market conditions, including reducing corporate overhead spending by over $48 million in 2009 and renegotiating vendor contracts, further reducing our operating costs. We have reinvested much of those savings to enhance the desirability of our properties to our retailers and our customers. Investment in our properties is critical to our ability to continue building long-term value in our Company. The modest decrease in comparable retail NOI for 2009 (4.4%) is consistent with our expectations, given current market conditions and the temporary impact of our restructuring and Chapter 11 proceedings. We are encouraged by the trends we saw in the second half of 2009, as occupancy rates and retail sales per square foot stabilized and retail sales trends began to recover. The steps we are taking now are building a stronger financial and operational foundation for GGP's future," Mr. Metz continued. A schedule showing adjustments and non-comparable income and expense items and their impact on 2009 and 2008 operating results is provided with this release. Readers of this release should also note, as with GGP's previous quarterly operational announcements for 2009, the 2008 fourth quarter and annual results have been restated from the amounts originally reported for such periods to reflect the adoption of two accounting pronouncements as of January 1, 2009 that required retrospective application. Concurrent with this release, the Company has also made available on its website its quarterly package of supplemental financial information that provides additional detail on its operational results. Operational Highlights GGP is focused on strengthening its assets and operational performance in order to maximize value over the long term. GGP invests in its properties to enhance their positions in the market and their appeal to shoppers and tenants and is committed to nurturing strong and long-lasting relationships with its retail partners. Among the operational highlights of 2009 are: * Towson Town Center (Baltimore, MD) -- Towson Town Center remains Baltimore's premiere retail destination. Following a remodel and 110,000 square foot expansion in 2009, the property opened Louis Vuitton, Crate & Barrel and Burberry stores and will be opening a Tiffany's in 2010. * Natick Collection (Natick, MA) -- GGP built on Natick Collection's unique upscale presence in the market by opening a "streetscape" addition and adding new dining options including Cheesecake Factory and California Pizza Kitchen. In addition, the property has attracted exclusive retailers such as a 33,000 square foot Crate & Barrel and New England's only American Girl store. * Christiana Mall (Newark, DE) -- GGP embarked on a large- scale renovation of this property, which historically generated one of the highest sales-per-square-foot in the nation. An interior renovation completed in 2009 attracted a significant number of new leases, including such retailers as H&M, Sephora, Urban Outfitters, Barnes & Noble, Forever 21 and Anthropologie. Over the next two years, the property will also finish leasing a new 700- seat food court and add a new Target store and a 122,000 -square-foot Nordstrom. Reductions in Recoverable Costs For the full year 2009, the Company achieved an 8.8% reduction in certain common area recoverable operating costs without reducing service levels by strategically containing costs and proactively managing contracted services. Savings from these cost reductions allowed the Company to increase its investment in property preservation and upkeep by approximately 5.9%, as illustrated in the table below, consistent with the Company's strategy of managing the business with a long-term outlook. Strategic Initiatives Financial Restructuring In April 2009, GGP and certain of its subsidiaries filed for relief under Chapter 11 of the Bankruptcy Code. The Chapter 11 case created the protection necessary for GGP to execute a restructuring to extend mortgage maturities and reduce corporate debt. GGP has pursued a deliberate two-stage strategy to establish a sustainable, long-term capital structure for the Company. The first step was to restructure its property-level secured mortgage debt. The Company believes it has achieved substantial progress with respect to the first phase of its restructuring strategy. As of March 1, 2010, it has restructured $10.65 billion of secured mortgage debt, and the GGP subsidiaries associated with such debt have emerged from bankruptcy. The restructuring of the additional $1.7 billion of secured mortgage debt for which we have filed consensual plans is expected to be completed and the related entities are expected to emerge from bankruptcy in the first quarter of 2010. GGP is continuing to pursue consensual restructurings for the remaining approximately $2.5 billion of secured mortgage debt and is prepared to pursue non-consensual resolution if necessary. The Company is now in the midst of the second phase: deleveraging its corporate capital structure and resolving its $6.5 billion of unsecured corporate debt. GGP has commenced a process to explore all potential alternatives for emergence from bankruptcy. As part of that process, GGP has announced an agreement in principle with Brookfield Asset Management Inc. ("Brookfield"), one of the world's largest real estate investors and asset managers, to invest $2.625 billion pursuant to a proposed recapitalization of GGP at a plan value of $15.00 per share with full recovery at par plus accrued interest to unsecured creditors. The proposed equity commitment from Brookfield is not subject to due diligence or any financing condition and is expected to create a floor value for the purpose of raising additional equity for the Company. The process to seek emergence alternatives is designed to maximize value for all GGP stakeholders. The Brookfield equity commitment, if consummated, would enable a restructured GGP to emerge from bankruptcy with a diverse portfolio of high-quality income- producing assets, strong cash flow and a solid balance sheet capitalized principally with long-term non-recourse debt. The agreement in principle with Brookfield is subject to definitive documentation, approval of the Bankruptcy Court and higher and better offers pursuant to a bidding process that GGP will request the Bankruptcy Court to approve. Operational Restructuring Along with the financial restructuring, GGP's management has initiated a significant operational restructuring to ensure the Company will be well-positioned to succeed following its emergence from bankruptcy. In 2009, the Company launched a corporate reengineering program, commenced a strategic planning process and executed an aggressive marketing strategy. These steps will ensure the Company remains focused on operational excellence and has an enhanced organizational structure to match the enhanced capital structure expected following emergence from bankruptcy. Corporate Reengineering Program -- GGP's corporate reengineering program created significant overhead cost savings in 2009 and is expected to generate additional material reductions in corporate overhead in 2010 and beyond. The program increases efficiency and allows individual properties to more quickly respond to and take advantage of evolving local market conditions. Strategic Planning -- GGP's Strategic Planning process ensures each center is well-positioned in its respective market by identifying specific key issues and developing customized strategic and tactical plans that encompass leasing, development, operations, marketing, and alternative revenue. Marketing Strategies -- Also in 2009, GGP implemented a reengineered marketing structure designed to meet the current and future needs of our Company, consumers and retailers. GGP unveiled the industry's most advanced integrated marketing program, combining traditional marketing with an aggressive online strategy including social and online media. This has created substantial efficiencies, further solidifying GGP's position as the industry leader in consumer engagement. Segment Results Retail and Other Segment NOI in this segment decreased to $606.9 million for the fourth quarter of 2009 from the $701.8 million reported for the fourth quarter of 2008 and was impacted by several one-time nonrecurring items. One-time items include $24.9 million of additional costs or reduced revenue related to bankruptcy-related claims and $15.5 million in additional property upkeep costs. These one-time items were partially offset by reductions in certain other common area recoverable costs. In addition, 2008 fourth quarter NOI included an insurance settlement of $11.9 million related to business interruption caused by hurricane Katrina in 2007. Excluding these items and other non-comparable items, NOI for 2009 declined 4.4% from 2008. GGP believes that NOI was further impacted by reduced leasing activity as a result of the Company's bankruptcy. Revenues from consolidated properties, excluding the hurricane Katrina settlement, declined $59.8 million, or approximately 7.5%, for the fourth quarter of 2009 to $768.8 million, primarily due to declines in tenant recoveries, overage rents and minimum rents, the latter as a result of declines in specialty leasing. Revenues from unconsolidated properties at the Company's ownership share were $161.9 million for the fourth quarter 2009, roughly flat from $162.2 million in the fourth quarter of 2008, reflecting continued solid performance and as a result of their isolation from the effects of GGP's bankruptcy filing. Comparable tenant sales, on a trailing 12 month basis, decreased 7.4% compared to the same period last year. Tenant sales per square foot, on a trailing 12 month basis, decreased 7.2% compared to the same period last year. Retail Center occupancy decreased to 91.6% at December 31, 2009 from 92.5% at December 31, 2008. Occupancy rates stabilized in the last four months of 2009, rising from 91.3% at the end of the third quarter to 91.6% at the end of the fourth quarter. Master Planned Communities Segment GGP's premier master planned community segment includes The Woodlands and Bridgeland, both in the Houston metropolitan area, Summerlin in Las Vegas and Columbia and Emerson in Maryland. On February 1, 2010, following a five-year coordinated community effort, local government authorities approved the Company's 30- year master plan for the town center at its Columbia, MD, master planned community, clearing a path to 13 million square feet of retail, commercial, residential, hotel and cultural development. Land sale revenues for the fourth quarter of 2009 were $7.2 million for consolidated properties and $11.7 million for unconsolidated properties, compared to $35.5 million and $18.1 million, respectively, for the fourth quarter of 2008. Decreases in land sale revenues reflect continued weak overall demand for individual lots. GGP believes conditions in this market are improving and expects 2010 sales to improve. NOI from the Master Planned Communities segment for the fourth quarter of 2009 was a loss of $1.6 million for consolidated properties and a positive $0.1 million for unconsolidated properties, compared to $5.7 million and $7.9 million, respectively, in the fourth quarter of 2008. Individual lot sales in 2009 were below 2008 levels and, together with 2009 bulk sales, did not exceed selling and community-specific general and administrative costs, which are largely fixed. GGP also filed with the Securities and Exchange Commission on March 1, 2010, a Annual Report on Form 10-K for the year ended December 31, 2010. GGP subsequently amended its Annual Report to correct a formatting error in a Report of Independent Registered Public Accounting Firm of Deloitte & Touch, which included in the Annual Report. General Growth Properties, Inc. Consolidated Balance Sheets Twelve Months Ended December 31, 2009 Assets: Investment in real estate: Land $3,327,447,000 Buildings and equipment 22,851,511,000 Less accumulated depreciation (4,494,297,000) Developments in progress 417,969,000 ---------------- Net property and equipment 22,102,630,000 Investment in and loans to/from Unconsolidated Real Estate Affiliates 1,979,313,000 Investment property and property held for development and sale 1,753,175,000 ---------------- Net investment and real estate 25,835,118,000 Cash and cash equivalents 654,396,000 Accounts and notes receivable, net 404,041,000 Goodwill 199,664,000 Deferred expenses, net 301,808,000 Prepaid expenses and other assets 754,747,000 ---------------- Total assets $28,149,774,000 ================ Liabilities and equity: Liabilities not subject to compromise Mortgages, notes and loans payable $7,300,772,000 Investment in and loans to/from Unconsolidated Real Estate Affiliates 38,289,000 Deferred tax liabilities 866,400,000 Accounts payable and accrued expenses 1,122,888,000 ---------------- Liabilities not subject to compromise 9,328,349,000 Liabilities subject to compromise 17,767,253,000 ---------------- Total liabilities 27,095,602,000 Equity: Common stock 3,138,000 Additional paid-in capital 3,729,453,000 Retained earnings (accumulated deficit) (2,832,627,000) Accumulated other comprehensive loss (249,000) Less common stock in treasury (76,752,000) ---------------- Total stockholders' equity 822,963,000 Noncontrolling interests in consolidated real estate affiliates 24,376,000 ---------------- Total equity 847,339,000 ---------------- Total liabilities and equity $28,149,774,000 ================ General Growth Properties, Inc. Consolidated Statements of Income Three Months Ended December 31, 2009 Revenues: Minimum rents $504,759,000 Tenant recoveries 208,845,000 Overage rents 26,092,000 Land sales 7,153,000 Management and other fees 15,651,000 Other 31,620,000 ---------------- Total revenues 794,120,000 ---------------- Expenses: Real estate taxes 70,452,000 Repairs and maintenance 70,714,000 Marketing 12,523,000 Other property operating costs 106,125,000 Land sales operations 8,761,000 Provision for doubtful accounts 5,226,000 Property management and other costs 46,391,000 General and administrative 6,171,000 Strategic initiatives - Provisions for impairment 749,390,000 Litigation benefit - Depreciation and amortization 179,059,000 ---------------- Total expenses 1,254,812,000 ---------------- Operating (loss) income (460,692,000) Interest income 1,567,000 Interest expense (328,086,000) ---------------- Loss before income taxes, noncontrolling interests and equity in income of Unconsolidated Real Estate Affiliates (787,211,000) Benefit from (provision for) income taxes 4,408,000 Equity in (loss) income of Unconsolidated Real Estate Affiliates (34,583,000) Reorganization items 193,705,000 ---------------- Loss from continuing operations (623,681,000) (Loss) Gain from discontinued operations (939,000) ---------------- Net (loss) income (624,620,000) Allocation to noncontrolling interests 12,261,000 ---------------- Net (loss) income attributable to controlling interests ($612,359,000) ================ General Growth Properties, Inc. Consolidated Statements of Income Twelve Months Ended December 31, 2009 Revenues: Minimum rents $1,992,046,000 Tenant recoveries 883,595,000 Overage rents 52,306,000 Land sales 45,997,000 Management and other fees 65,268,000 Other 96,602,000 ---------------- Total revenues 3,135,814,000 ---------------- Expenses: Real estate taxes 280,895,000 Repairs and maintenance 232,624,000 Marketing 34,363,000 Other property operating costs 416,332,000 Land sales operations 50,807,000 Provision for doubtful accounts 30,331,000 Property management and other costs 176,876,000 General and administrative 28,608,000 Strategic initiatives 67,341,000 Provisions for impairment 1,223,810,000 Litigation benefit - Depreciation and amortization 755,161,000 ---------------- Total expenses 3,297,148,000 ---------------- Operating (loss) income (161,334,000) Interest income 3,321,000 Interest expense (1,311,283,000) ---------------- Loss before income taxes, noncontrolling interests and equity in income of Unconsolidated Real Estate Affiliates (1,469,296,000) Benefit from (provision for) income taxes 14,610,000 Equity in (loss) income of Unconsolidated Real Estate Affiliates 4,635,000 Reorganization items 146,190,000 ---------------- Loss from continuing operations (1,303,861,000) (Loss) Gain from discontinued operations (966,000) ---------------- Net (loss) income (1,304,827,000) Allocation to noncontrolling interests 20,138,000 ---------------- Net (loss) income attributable to controlling interests ($1,284,689,000) ================ General Growth Properties, Inc. Consolidated Statements of Cash Flows Twelve Months Ended December 31, 2009 Cash flows from operating activities: Net (loss) income ($1,304,827,000) Adjustments to reconcile net (loss) income to net cash provided by operating activities: Equity in income of Unconsolidated Real Estate Affiliates (49,146,000) Provision for impairment from Unconsolidated Real Estate Affiliates 44,511,000 Provision for doubtful accounts 30,331,000 Distributions received from Unconsolidated Real Estate Affiliates 37,403,000 Depreciation 707,183,000 Amortization 47,978,000 Amortization of deferred finance costs and debt market rate adjustments 34,621,000 Amortization of intangibles other than in-place leases 833,000 Straight-line rent amortization (26,582,000) Deferred income taxes including tax restructuring benefit 833,000 Non-cash interest expense on Exchangeable Senior Notes 27,388,000 Non-cash interest expense resulting from termination of interest rate swaps (9,635,000) Loss (gain) on dispositions 966,000 Provisions for impairment 1,223,810,000 Participation expense pursuant to Contingent Stock Agreement (4,947,000) Land/residential development and acquisitions expenditures (78,240,000) Cost of land sales 22,019,000 Non-cash reorganization items (266,916,000) Glendale Matter deposit 67,054,000 Net changes: Accounts and notes receivable (22,601,000) Prepaid expenses and other assets (11,123,000) Deferred expenses (34,064,000) Accounts payable and accrued expenses and deferred tax liabilities 355,025,000 Other, net 9,590,000 ---------------- Net cash provided by operating activities 871,266,000 ---------------- Cash flows from investing activities: Acquisitions/development of real estate and property additions/improvements (252,844,000) Proceeds from sales of investment properties 6,416,000 Increase in investments in Unconsolidated Real Estate Affiliates (154,327,000) Distributions received from Unconsolidated Real Estate Affiliates in excess of income 74,330,000 Loans from (to) Unconsolidated Real Estate Affiliates, net (9,666,000) Decrease in restricted cash 6,260,000 Other, net (4,723,000) ---------------- Net cash used in investing activities (334,554,000) ---------------- Cash flows from financing activities: Proceeds from issuance of mortgages, notes and loans payable - Proceeds from issuance of the DIP Facility 400,000,000 Principal payments on mortgages, notes and loans payable (379,559,000) Deferred financing costs (2,614,000) Finance costs related to emerged entities (69,802,000) Cash distributions paid to common stockholders - Cash distributions paid to holders of Common Units (1,327,000) Cash distributions paid to holders of perpetual and convertible preferred units - Proceeds from issuance of common stock, including common stock plans 43,000 Other, net 1,950,000 ---------------- Net cash (used in) provided by financing activities (51,309,000) ---------------- Net change in cash and cash equivalents 485,403,000 Cash and cash equivalents at beginning of period 168,993,000 ---------------- Cash and cash equivalents at end of period $654,396,000 ================ 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: Sees Bankruptcy Emergence by October ---------------------------------------------------- General Growth Properties Inc. said in a court filing that it is pursuing the final phase of its emergence process during the next six months. Counsel to the Debtors, Marcia L. Goldstein, Esq., at Weil, Gotshal & Manges LLP, in New York, asserted that GGP's process to emerge from Chapter 11 has been deliberately staged in two parts: (1) The first part was to secure long-term, economically attractive mortgage debt financing allowing the market to establish an enterprise value of GGP; and (2) The second part includes a competitive capital raise and strategic sale process to maximize recoveries for stakeholders and fairly distribute the tremendous enterprise value created during the first 10 months of these highly complex cases. In light of this dualtrack process, Ms. Goldstein disclosed that GGP is proposing a timeline, which culminates in the confirmation of a plan of reorganization. The timeline has two parts: (i) selection of the best transaction to be incorporated in the plan and (ii) the confirmation process. The timeline is: March 19, 2010 * Debtors file motion to approve proposed bidding procedures/selection of plan transaction * GGP continues due diligence and capital raise process April 13, 2010 * Hearing on Bidding Procedures Motion May 18, 2010 * Deadline for potential bidders to submit bids May 18 to June * GGP negotiates final bids and determines 22, 2010 transaction to be included in a plan * GGP files plan and disclosure statement July 27, 2010 * Hearing on the Disclosure Statement August 6, 2010 * Deadline to commence solicitation September 20, 2010 * Plan Voting Deadline * Plan Confirmation Objection Deadline October 5, 2010 * Confirmation Hearing of the Plan To recall, GGP has reached an agreement in principle with Brookfield Asset Management Inc., one of the world's largest real estate investors and asset managers, to invest $2.625 billion in a proposed recapitalization of GGP at a plan value of $15.00 per share and provide par plus accrued interest to unsecured creditors. Although GGP has chosen Brookfield as its stalking horse, it expects interested parties to participate pursuant to the proposed timeline, Ms. Goldstein noted. GGP will share the final proposals with the Creditors' Committee, the Equity Committee, and the advisors to the ad hoc committees and will welcome appropriate coordination with the Committees to maintain the integrity of the competitive process to select the best transaction on which to base a plan, she added. Contrary to the Creditors' Committee's assertions, GGP has made exceptional progress in formulating and implementing its strategy to emerge with a stronger balance sheet, Ms. Goldstein argued. That plan has been communicated many times to the Creditors Committee, she said. She further pointed out that as any transaction will require the same time period to accomplish, as outlined by GGP's emergence timeline, there simply is no additional risk to creditors by GGP's process. Moreover, given GGP's current equity trading value and the ability of debt holders to sell their claims for a full cash recovery, it is incumbent on GGP to explore a recapitalization that involves sources of equity and/or debt capital that may provide the best outcome for stakeholders, she asserted. At best, Ms. Goldstein contended that the Creditors' Committee has adopted as its agenda a desire to usurp control of the emergence process in an effort to truncate any effort to realize the fair value of the enterprise for shareholders. Moreover, the Creditors' Committee's argument that GGP has failed to be transparent with respect to its capital raise process is wholly undermined by the fact that GGP has been transparent in all other aspects of its restructuring and has engaged with the financial advisors to the Creditors' Committee to describe the company's capital raise process. 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: Stonestown Shopping, et al., Win Plan Approval -------------------------------------------------------------- Judge Allan L. Gropper of the U.S. Bankruptcy Court for the Southern District of New York issued a formal order on March 3, 2010, confirming the Joint Plan of Reorganization, and approving, on a final basis, the accompanying Disclosure Statement as to these seven debtors: * Stonestown Shopping Center Holding L.L.C. * Stonestown Shopping Center L.L.C. * Stonestown Shopping Center, L.P. * GGP-Mall of Louisiana II, L.P. * GGP-Mall of Louisiana, Inc. * GGP-Mall of Louisiana, L.P. * Mall of Louisiana Holding, Inc. On behalf of the Plan Debtors, James A. Mesterharm, director of AlixPartners, LLP, as restructuring advisor to the Debtors, filed with the Court a declaration, as amended on March 2, 2010, appending an updated version of the Debtors' financial projections. The updated Financial Projections reflect recent performance, certain adjustments to reflect General Growth Properties, Inc.'s current outlook, and certain costs incurred with respect to closing and emergence costs for certain Plan Debtors. The Updated Financial Projections also forecast the Debtors' cash flow through the end of 2010, he noted. A table showing GGP's 13 Months Cash Forecast is available for free at http://bankrupt.com/misc/ggp_mar2cashforecast.pdf Mr. Mesterharm further noted that at the end of January 2010, the Debtors had $479.4 million of cash on hand. Through the end of 2010, the Plan Debtors will incur another $109.7 million of costs associated with their emergence from bankruptcy and capital obligations under the Plan, including funding real estate and other escrows and making catch-up amortization payments on the Plan Debtors' secured property-level loans, of which $32.5 million is related to the Plan Debtors whose confirmation hearing is scheduled for March 3, 2010, he related. The Plan Debtors will also incur $94.2 million by paying certain prepetition amounts, he said. As set forth in the Updated Financial Projections, the Debtors will have more than sufficient cash to cover these costs, he assured the Court. In addition, on the earlier of GGP and GGP Limited Partnership, collectively known as TopCo's emergence from Chapter 11 or December 2010, the Plan Debtors will incur additional obligations under the Plan: (a) a $137 million paydown on GGP Ala Moana L.L.C.'s property in Honolulu; and (b) a "vacant anchor" reserve equal to $2 per square foot reserve for total collateral gross leasable area but excluding out-parcels, currently estimated at $33 million. The Plan Debtors expect to fund these costs from their cash flows and, to the extent necessary, from GGP LP's centralized cash management system. By the end of December 2010, if TopCo has not yet emerged from bankruptcy, GGP LP is projected to have an available cash balance of $331.8 million after the Plan Debtors have satisfied all emergence costs and funding requirements under the Plan, Mr. Mesterharm added. The Plan Debtors also submitted to the Court on February 26, 2010, amended exhibits to their Joint Plan of Reorganization to supplement property-specific Exhibit "B" with respect to Beachwood Place Mall, LLC; GGP-Mall of Louisiana, Inc.; GGP-Mall of Louisiana, L.P.; GGP-Mall of Louisiana II, L.P.; Stonestown Shopping Center, L.P.; and Stonestown Shopping Center Holding, L.L.C. A full-text copy of property-specific Exhibit "B" for these six Plan Debtors is available for free at: http://bankrupt.com/misc/ggp_6PropExhibitB.pdf The Plan Debtors further amended and replaced on March 2, 2010, property-specific Exhibit "B" with respect to GGP-Mall of Louisiana, Inc.; GGP-Mall of Louisiana II, L.P.; GGP-Mall of Louisiana, L.P.; Stonestown Shopping Center L.P.; and Stonestown Shopping Center Holding L.L.C. A full-text copy of the property- specific Exhibit "B" for these five Plan Debtors is available for free at http://bankrupt.com/misc/ggp_5PropExhibitB.pdf Judge Gropper confirmed the Plan, as amended, and each of its provisions under Section 1129 of the Bankruptcy Code. All rulings and orders contained in the confirmation order dated December 15, 2009 are adopted as the rulings and orders for this confirmation order dated February 16, 2010, Judge Gropper said. By prior specific agreement with certain surety companies, Judge Gropper affirmed that the provision with respect to surety bonds under the Plan will apply to the Three Plan Debtors. The provision states that unless specifically rejected by order of the Bankruptcy Court, all of the Plan Debtors' surety bonds and any related agreements, documents or instruments, will continue in full force and effect. Nothing contained in the Plan will constitute or be deemed a waiver of any cause of action that the Plan Debtors may hold against any entity, including the issuer of the surety bond, under any of the Plan Debtors' surety bonds. A full-text copy of the Confirmation Order dated March 3, 2010, is available for free at: http://bankrupt.com/misc/ggp_Mar3ConfOrder.pdf Voting Results Travis K. Vandell, senior managing consultant at Kurtzman Carson Consultants LLC, filed with the Court on March 2, 2010, a supplemental tabulation of votes for the Joint Plan of Reorganization with respect to Plan Debtors GGP-Mall of Louisiana II, LP; GGP-Mall of Louisiana, Inc.; Stonestown Shopping Center Holding, LLC; GGP-Mall of Louisiana, LP, and Stonestown Shopping Center, LP. Five creditors grouped as Class B holding a total of $570,024,243 voted to accept the Plan. Class B is the only voting class under the Plan. Accept or Dollars Dollars Creditor Name Reject Accept Reject ------------- --------- --------- ------- Debt Holdings LLC Accept $62,601,732 $0 Debt Holdings LLC Accept $62,601,732 $0 Debt Holdings LLC Accept $57,620,173 $0 U.S. Bank NA, as Accept $171,600,606 $0 trustee for the registered holders and Debt Holdings, LLC Wells Fargo Bank NA Accept $215,600,000 $0 A full-text copy of the Tabulation Report on the votes on the Plan is available for free at: http://bankrupt.com/misc/ggp_5PlanDebtorsVotingResults.pdf Four Debtors Plan Adjourned Judge Gropper adjourns the hearing with respect to confirmation of the Joint Plan of Reorganization and final approval of the Disclosure Statement as to five Plan Debtors to a later date. The Plan Debtors subject to adjournment are: * 10000 West Charleston Boulevard, LLC * 1120/1140 Town Center Drive, LLC * 9901-9921 Covington Cross, LLC * Beachwood Place Mall, LLC * Beachwood Place Holding, LLC More Properties to be Restructured GGP said in its annual report on Form 10-K that during December 2009, January and February 2010, 231 units of GGP (the "Track 1 Debtors") owning 119 properties with $12.33 billion of secured mortgage debt filed consensual plans of reorganization (the "Track 1 Plans") with the Bankruptcy Court. As of December 31, 2009, 113 Debtors owning 50 properties with approximately $4.65 billion of secured mortgage debt restructured that debt and emerged from bankruptcy (the "Track 1A Debtors"). Through March 1, 2010, an additional 92 Debtors owning 57 properties with approximately $5.98 billion of secured mortgage debt restructured that debt and emerged from bankruptcy. Effectiveness of the plans of reorganization and/or restructuring of the $1.70 billion of secured mortgage debt of the remaining Track 1 Debtors (together with the Track 1 Debtors that have already emerged from bankruptcy in 2010, the "Track 1B Debtors") is expected to occur in the first quarter of 2010. GGP is continuing to pursue consensual restructurings for 31 Debtors (the "Remaining Secured Debtors") with secured loans aggregating $2.50 billion. The Chapter 11 Cases for the Remaining Secured Debtors and the other remaining Debtors (generally GGP, GGPLP and other holding company subsidiaries, the "TopCo Debtors" and together with the Remaining Secured Debtors, the "2010 Track Debtors") will continue until their respective plans of reorganization are filed, approved by the respective creditors, confirmed by the Bankruptcy Court and are effective. 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: Campaigns Against Colorado Bill on Dealers ---------------------------------------------------------- General Motors Co. is launching a campaign to slam a bill that would require it and Chrysler Group LLC to reimburse terminated dealers for required five-year upgrades, Businessweek reported. The legislation passed in the House by a 60-5 vote, and is awaiting Senate action, according to The Denver Post. "[It] threatens our ability to essentially run our business at the retail level," GM spokesman Greg Martin told Businessweek. GM is spending $60,000 for radio and ad campaigns against the bull that, according to the Company, bypasses an arbitration process approved by Congress. GM has said it is targeting to finish "within the next two months" an internal review of the 1,160 arbitration claims submitted by dealers that it closed in 2009. "We don't think our concerns are unreasonable," John Montford, a GM senior adviser for government relations said in a statement to The Denver Post. "Our focus remains on getting our taxpayer loans paid back," Mr. Monford emphasized. GM has informed 2,000 dealers about officially cutting ties in October 2010 as part of its restructuring efforts. Chrysler, for its part, had terminated 789 dealerships. Twenty-five GM dealers in Colorado are slated to be cut off, Colorado Automobile Dealers Association President Tim Jackson told Businessweek. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2009, GM had US$107.45 billion in total assets against US$135.60 billion in total liabilities. About Motors Liquidation 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: Lawmakers Call to Save Delphi Pensions ------------------------------------------------------ Nine U.S. senators and 23 representatives from seven states called on President Barack Obama to compel General Motors to ensure that salaried retirees at Delphi Corp. don't lose their pensions, reported The Buffalo News on February 27, 2010. In a letter sent February 26, the lawmakers said that GM's salaried retirees have received notices from the Pension Benefit Guaranty Corp. that they are facing cuts of up to 70 percent in their retirement benefits, the report said. "They will have a profoundly negative impact on the individual retirees, their families, and their communities, which are already struggling to survive the most severe economic downturn since the Great Depression," the letter noted. GM acquired the plants from Delphi Corporation in October 2009, to ensure that the supply of auto parts to GM won't be cut off. The Letter noted that GM agreed to protect Delphi's hourly workers who were members of the United Auto Workers, as part of an Agreement that allowed Delphi to emerge from bankruptcy with GM's financial aid. The Agreement, however, "did not apply to hourly employees represented by other unions or to the salaried managers, leaving 20,000 salaried retirees and 100 union retirees with no additional pension guarantee," the newspaper said. "As a 60 percent shareholder in GM, the federal government is in a position to do something to restore fairness for these retirees and to minimize the economic impact of the pension loss on their communities," the letter said, urging President Obama to bring GM to the negotiating table" to "work out a fair solution," according to the report. On March 4, 2010, hourly workers at GM's Lockport plant, formerly Delphi Thermal Systems, are protesting the Company's attempt to gain contract concessions from the United Auto Workers union and its members, the Houston Business Journal reported. Gordie Fletcher, president of UAW Local 686 Unit No. 1 at Lockport, told the newspaper that GM "wants members to forego a 3.75 percent cost-of-living raise that was scheduled to go into effect in January but which has not been paid." The Union also points to bonuses that salaried workers have not received. Moreover, the UAW members' "immense sense of frustration" is due to the absence of added work for employees at the Lockport plant, the report added. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2009, GM had US$107.45 billion in total assets against US$135.60 billion in total liabilities. About Motors Liquidation 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: New GM May Drop Converj to Focus on Hybrids ----------------------------------------------------------- General Motors Co. has halted work on the Cadillac Converj as of late January 2010, to focus on cheaper plug-in hybrids, two GM executives who refused to be named told Bloomberg News. GM concluded that the Converj, an electric-drive coupe similar to the Chevrolet Volt, "couldn't have enough amenities and electric range to be compelling to buyers and produce a profit," Bloomberg reports, citing the GM executives as saying. The Volt has lithium-ion batteries and a gasoline motor used only for recharging, not to power the wheels, and is designed to run 40 miles or 64 kilometers on electricity alone. GM plans to sell the Volt for $40,000 in November 2010, according to the report. Like the Volt, the coming generation of plug-in hybrids from GM will be able to replenish their batteries at household outlets, with range on electricity at 10 miles. GM may also add plug-in technology to other models in the line, the executives told Bloomberg, noting that the gasoline-powered Cadillac XTS sedan will be out in 2013. Vice Chairman Bob Lutz also confirmed during the Geneva Motor Show that GM has elected to cease production plans for the Converj, reported Reuters. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2009, GM had US$107.45 billion in total assets against US$135.60 billion in total liabilities. About Motors Liquidation 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: Recalls 1.3 Million Compact Cars ------------------------------------------------ General Motors Co. is recalling 2005 to 2010 Chevrolet Cobalts, 2007 to 2010 Pontiac G5s, 2005 and 2006 Pontiac Pursuits sold in Canada; and 2005 and 2006 Pontiac G4s sold in Mexico -- or about 1.3 million cars in total -- to fix power steering motors that can fail. While the compact vehicles are generally safe to drive, it may be prone to steering problems when traveling under 15 mph, says Reuters, citing a GM statement. GM will notify car owners when the parts are available from the Company's supplier, JTEKT Corp., GM spokesman Alan Adler told The Associated Press. The National Highway Traffic Safety Administration about the recall began an investigation into 905,000 of the GM models on January 27, 2010, after 1,100 complaints were filed regarding the the cars' loss of power steering assist. The complaints included 14 crashes and one injury, according to the report. "Recalling these vehicles is the right thing to do for our customers' peace of mind," Jamie Hresko, GM's vice president of quality, said in a statement. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2009, GM had US$107.45 billion in total assets against US$135.60 billion in total liabilities. About Motors Liquidation 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: Cadillac Distances to Avoid Bankruptcy Stigma ------------------------------------------------------------- Keith Naughton at Bloomberg News reports that Cadillac, the luxury brand General Motors Co. acquired in 1909, is distancing itself from GM to avoid the stigma of the parent company's $50 billion U.S.-backed bankruptcy last year. According to Bloomberg, spokesman Nick Twork said Cadillac is erasing the GM name from its marketing and dealerships, changing e-mail addresses to @cadillac.com from @gm.com and exiting companywide promotions such as the Red Tag Event, said Nick Twork, a spokesman. The separation strategy was "absolutely" driven by GM's restructuring, he said. About General Motors General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. With its global headquarters in Detroit, GM employs 209,000 people in every major region of the world and does business in some 140 countries. GM and its strategic partners produce cars and trucks in 34 countries, and sell and service these vehicles through these brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel, Vauxhall and Wuling. GM's largest national market is the United States, followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM acquired its operations from General Motors Company, n/k/a Motors Liquidation Company, on July 10, 2009, pursuant to a sale under Section 363 of the Bankruptcy Code. Motors Liquidation or Old GM is the subject of a pending Chapter 11 reorganization case before the U.S. Bankruptcy Court for the Southern District of New York. At September 30, 2009, GM had US$107.45 billion in total assets against US$135.60 billion in total liabilities. About Motors Liquidation 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) HANA BIOSCIENCES: Posts $5.7 Million Net Loss in Q3 2009 -------------------------------------------------------- Hana Biosciences, Inc., filed its quarterly report on Form 10-Q, showing a net loss of $5.7 million for the three months ended September 30, 2009, compared with a net loss of $5.2 million for the same period 2008. The Company's balance sheet as of September 30, 2009, showed $4.9 million in assets and $29.5 million of debts, for a stockholders' deficit of $24.6 million. "The Company does not generate any recurring revenue and will require substantial additional capital before it will generate cash flow from its operating activities, if ever." "Based on the anticipated use of cash resources of between $4.0 million and $5.5 million per quarter, which includes any milestones pursuant to the Company's license agreements, the Company estimates that its current cash resources are only sufficient to fund its planned research and development activities into mid-2010. However, if anticipated costs are higher than planned, or if the Company is unable to raise additional capital, it will have to significantly curtail its development activities to maintain operations through 2010 and beyond." The Company believes these factors raise substantial doubt as to its ability to continue as a going concern. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?5799 Hana Biosciences, Inc. is a South San Francisco, California-based biopharmaceutical company dedicated to developing and commercializing new and differentiated cancer therapies designed to improve and enable current standards of care. HOVNANIAN ENT: Swings to $236.1-Mil. Profit in Jan. 31 Quarter -------------------------------------------------------------- Hovnanian Enterprises Inc. filed its quarterly report on Form 10- Q, reporting a net income of $236.1 million on revenue of $319.6 million for the three months ended January 31, 2010, compared with a net loss of $178.4 million on revenue of $373.78 million in the same period during the prior fiscal year. The Company's balance sheet at Jan. 31, 2010, showed $2.10 billion in assets and $2.21 billion in total liabilities resulting to a $110.69 million stockholders' deficit. The Company said cash from housing and land sales, income tax refunds and other revenues will be sufficient through fiscal 2010 to finance working capital requirements and other needs, despite continued declines in total revenues, the termination of its revolving credit facility and the collateralization with cash in segregated accounts to support certain of its letters of credit. The Company may also enter into land sale agreements or joint ventures to generate cash from its existing balance sheet. Due to a change in tax legislation that became effective on November 6, 2009, the company is able to carryback its 2009 net operating loss five years to previously profitable years. As a result, the Company have received a $274.1 million federal income tax cash refund during its second quarter of fiscal 2010 and the expect to receive the remaining $17.2 million later in the year. A full-text copy of the Company's quarterly report on Form 10-Q is available for free at http://ResearchArchives.com/t/s?57c9 About Hovnanian Enterprises Hovnanian Enterprises, Inc. (NYSE: HOV), founded in 1959 by Kevork S. Hovnanian, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian(R) Homes(R), Matzel & Mumford, Brighton Homes, Parkwood Builders, Town & Country Homes, Oster Homes, First Home Builders of Florida and CraftBuilt Homes. As the developer of K. Hovnanian's(R) Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes. * * * Hovnanian carries S&P's "CCC" corporate credit rating; Moody's "Caa1" corporate family rating; and Fitch's "CCC" Issuer Default Rating. INFOGROUP INC: S&P Puts 'BB' Rating on CreditWatch Negative ----------------------------------------------------------- Standard & Poor's Ratings Services placed its 'BB' corporate credit rating for Omaha, Neb.-based infoGROUP Inc., along with all associated issue-level ratings, on CreditWatch with negative implications. "The CreditWatch listing reflects infoGROUP's announcement that it will be acquired by CCMP Capital Advisors LLC, a private equity group," said Standard & Poor's credit analyst Liz Fairbanks. "S&P expects the transaction to likely add leverage to the company's balance sheet." The transaction is valued at $635 million and includes the refinancing of infoGROUP's outstanding debt, which totaled $182 million as of December 2009. Common shareholders will receive $8 per share in cash, which is below last Friday's closing share price of $8.16. The transaction is subject to shareholder approval. Former CEO and Chairman Vinod Gupta owns approximately 36% of shares outstanding. infoGROUP expects the transaction to close early this summer. In resolving the CreditWatch listing, S&P will review the details of the transaction as they become available, the new owner's operating and financial strategies, and the pro forma capital structure. S&P's review will also focus on its expectations for the company's performance in 2010. INTERNATIONAL COAL: Moody's Affirms 'Caa1' Corp. Family Rating -------------------------------------------------------------- Moody's Investors Service affirmed the ratings of International Coal Group, including the corporate family rating of Caa1. Simultaneously, Moody's assigned a Caa1 (LGD 4; 57%) rating to the company's new $200 million second lien senior secured notes due 2018. The rating outlook remains stable. ICG is issuing approximately $200 million of new senior secured second lien notes and $75 million of new convertible notes (not rated by Moody's). Proceeds, in addition to approximately $100 million of new common equity, are expected to refinance $140 million of existing 9% convertible notes (not rated by Moody's) and $175 million of 10.25% senior unsecured notes. Upon completion of the transactions, Moody's anticipates withdrawing the ratings on the 10.25% senior unsecured notes. All rating actions described are contingent upon ICG's successful execution of the planned transactions and subject to review of final documentation. The affirmation of the Caa1 corporate family rating considers the $40 million reduction in expected debt levels, less interest expense, and improved maturity profile. Although the convertible notes have a maturity date one year ahead of the second-lien senior secured notes, the maturity profile has improved with the nearest maturity having been pushed to 2014 from 2012. However, the ratings continue to reflect ICG's elevated cost structure amidst an uncertain price environment, inherent operating risk at its mines, history of operating and financial challenges, significant capital spending requirements, and uncertainty regarding mine permitting obstacles particularly given the large percentage of surface mine production. The ratings remain supported by the company's adequate liquidity position, improved capital structure, significant owned coal reserves and minimal other liabilities (including reclamation, workers' compensation, black lung, and other legacy liabilities) relative to other rated coal producers. The ratings also consider the company's small, but growing production of higher value metallurgical coal used primarily by the steel industry. Ratings impacted by the actions include: -- Corporate Family Rating affirmed at Caa1 -- Probability of Default Rating affirmed at Caa1 -- $125 million asset based loan facility due 2014 affirmed at Ba3 (LGD 2; 18%) -- $200 million second lien senior secured notes due 2018 assigned Caa1 (LGD 4; 57%) -- Outlook remains stable -- SGL affirmed at SGL-3 These ratings will be withdrawn assuming successful completion of the anticipated transactions: -- $175 million 10.25% senior unsecured notes due 2014 of Caa2 (LGD 5; 70%) The last rating action was on March 2, 2010, when the ratings of ICG were raised, including the CFR which was upgraded to Caa1 from Caa2. International Coal Group, Inc., operates 13 coal mining complexes (8 in Central Appalachia, 4 in Northern Appalachia, and 1 in the Illinois Basin). ICG owns approximately two-thirds of its 1.0 billion tons of coal reserves. The company produced approximately 16.3 million tons of coal in 2009. JCAV LLC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------- Debtor: JCAV LLC PO Box 463 Fox Island, WA 98333 Bankruptcy Case No.: 10-41710 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Debtor's Counsel: Benjamin J. Riley, Esq. Brian L Budsberg PLLC 1801 West Bay Drive, Ste 301 Olympia, WA 98507 Tel: (360) 584-9093 Email: ben@budsberg.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 $7,663,780, and total debts of $3,896,831. 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/wawb10-41710.pdf The petition was signed by Jack Vander Waal, managing member of the Company. JONES SODA: Inks LOI for Possible Merger with Reeds Inc. -------------------------------------------------------- On March 9, 2010, Jones Soda Co. disclosed that it has entered into a letter of intent regarding a possible merger with Reed's, Inc., with Reed's as the surviving company. The combination would unite a number of leading premium soda brands, such as Reed's Ginger Brew, Virgil's, and Jones Soda. The non-binding provisions of the LOI contemplate a merger transaction in which Reed's would acquire Jones Soda for a combination of cash and Reed's common stock. The shareholders of Jones Soda would receive an aggregate of 4.5 million shares of Reed's common stock (or approximately 0.17 of a share of Reed's common stock per share of Jones Soda common stock based on current Jones Soda shares outstanding) and cash of $0.10 per share of Jones Soda common stock (or an aggregate of approximately $2.56 million based on current shares outstanding). There is no financing contingency as Reed's would use its best efforts to secure the cash portion of the consideration, and if it is unable to secure all or part of this cash, any deficit would instead be paid in additional shares of Reed's common stock, with the aggregate number of shares equal to the amount of the cash deficit divided by $1.70. Mr. Chris Reed, Founder, Chairman and CEO of Reed's stated, "We have watched Jones for years and have been impressed with its innovative marketing programs, strong brand recognition, and loyal customer following. I am confident that our portfolio of brands will benefit from Jones Soda's marketing savvy as well as its organization's deep mainstream distribution relationships. At the same time, we believe our strong infrastructure and operational capabilities will help drive important efficiencies through Jones Soda's supply chain. With minimal customer and demographic overlap between our combined brands, we believe this transaction also provides us with compelling merchandising and growth opportunities in the years ahead." Jones Soda retained North Point Advisors in February 2009 to assist in evaluating the company's strategic alternatives. Since that time, Jones has reviewed a broad range of strategic alternatives to enhance shareholder value. Rick Eiswirth, Chairman of the Board of Jones Soda Co., stated, "Over the past year we have taken numerous steps to reduce our expenses and reinvigorate our top line in order to return to profitability. Unfortunately, the challenging economic environment combined with our current capitalization has made it extremely difficult to operate on a standalone basis. After evaluating a range of strategies aimed at improving our outlook, our Board of Directors determined that the proposed merger with Reed's offers our shareholders the most compelling long-term benefits of the available alternatives. We believe the combination of Jones and Reed's will create a substantially larger beverage business with a more powerful operating platform and a brighter future. We are especially pleased that the Jones shareholders will be able to participate in the potential upside of the combined business, as a meaningful portion of the consideration is in the form of Reed's stock." Under the binding provisions of the LOI, Reed's and Jones Soda have until April 5, 2010, to negotiate a definitive agreement on an exclusive basis. If Jones Soda receives an unsolicited acquisition, financing or other strategic transaction proposal that the Board of Directors of Jones Soda determines is superior to the proposed merger transaction with Reed's, then Jones Soda may terminate the LOI and reimburse Reed's for its third party out-of-pocket expenses (not to exceed $75,000). Since the transaction terms of the LOI are non-binding, they are subject to the negotiation, execution and delivery of a definitive agreement approved by the respective Boards of Directors of each company. Accordingly, the proposed terms of the transaction are subject to change, and there can be no assurance that Reed's and Jones Soda will enter into a definitive agreement on the terms outlined above, if at all, or that any transaction between the parties will ultimately be consummated. The companies do not intend to disclose developments with respect to negotiation of the definitive agreement until their respective Boards of Directors deem it appropriate. The transaction would also be subject to approval of the shareholders of both Jones Soda and Reed's. A copy of the joint press release issued by the Company and Reed's, Inc. is available for free at: http://researcharchives.com/t/s?5811 About Reed's, Inc. Reed's, Inc. (NASDAQ: REED) -- http://www.reedsgingerbrew.com/-- makes top selling sodas in natural food markets nationwide and is currently selling in 10,500 supermarkets in natural foods and mainstream. In addition, the Company owns the Virgil's Root Beer product line, and the China Cola product line. Recently, Reed's added the Sonoma Sparkler brands to its line. Other product lines include: Reed's Ginger Candies and Reed's Ginger Ice Creams. Reed's products are sold through specialty gourmet and natural food stores, mainstream supermarket chains, retail stores and restaurants nationwide, and in Canada. About Jones Soda Headquartered in Seattle, Washington, Jones Soda Co. (NASDAQ: JSDA) -- http://www.jonessoda.com/-- markets and distributes premium beverages under the Jones Soda, Jones Pure Cane Soda(TM), Jones 24C(TM), Jones GABA(R), Jones Organics(TM), Jones Naturals(R) and Whoopass Energy Drink(R) brands and sells through its distribution network in markets primarily across North America. * * * The Company has incurred net losses of $6.1 million and $11.8 million for the nine months ended September 30, 2009, and 2008, respectively, and has used a significant amount of its cash resources during these periods to fund its net losses, working capital and capital expenditure requirements. The Company had accumulated deficits of $35.5 million and $29.4 million as of September 30, 2009, and December 31, 2008, respectively. Cash used in operations for the nine months ended September 30, 2009, and 2008 was $6.2 million and $11.5 million, respectively. As reported in the Troubled Company Reporter on November 24, 2009, the Company says that it may no longer have sufficient margin in its operating plan to absorb further material declines against the Company's expectations with regard to the economy or its business. The Company believes its revised operating plan already includes the majority of attainable cost cutting measures, which places greater emphasis on the need to meet its case sales projections in order to effectively operate its business. The Company said there is uncertainty regarding its ability to meet its revised case sales projections. The Company believes this uncertainty, together with its inability to implement further meaningful cost containment measures beyond those it undertook in the third quarter and the extremely difficult environment in which to obtain additional equity or debt financing, raise substantial doubt about its ability to continue as a going concern. JONES SODA: Joth Ricci Resigns as President and CEO --------------------------------------------------- Joth Ricci has resigned as President and Chief Executive Officer and a member of the Board of Directors of Jones Soda Co., effective April 2, 2010. In his resignation letter, Mr. Ricci stated that he is resigning to pursue new career opportunities and not because of any disagreement with the Company on any matter relating to the Company's operations, policies or practices. Mr. Ricci will continue to serve as the Company's President and Chief Executive Officer, and as a member of the Board of Directors, until the effective date of his resignation. About Jones Soda Headquartered in Seattle, Washington, Jones Soda Co. (NASDAQ: JSDA) -- http://www.jonessoda.com/-- markets and distributes premium beverages under the Jones Soda, Jones Pure Cane Soda(TM), Jones 24C(TM), Jones GABA(R), Jones Organics(TM), Jones Naturals(R) and Whoopass Energy Drink(R) brands and sells through its distribution network in markets primarily across North America. * * * The Company has incurred net losses of $6.1 million and $11.8 million for the nine months ended September 30, 2009, and 2008, respectively, and has used a significant amount of its cash resources during these periods to fund its net losses, working capital and capital expenditure requirements. The Company had accumulated deficits of $35.5 million and $29.4 million as of September 30, 2009, and December 31, 2008, respectively. Cash used in operations for the nine months ended September 30, 2009, and 2008 was $6.2 million and $11.5 million, respectively. As reported in the Troubled Company Reporter on November 24, 2009, the Company says that it may no longer have sufficient margin in its operating plan to absorb further material declines against the Company's expectations with regard to the economy or its business. The Company believes its revised operating plan already includes the majority of attainable cost cutting measures, which places greater emphasis on the need to meet its case sales projections in order to effectively operate its business. The Company said there is uncertainty regarding its ability to meet its revised case sales projections. The Company believes this uncertainty, together with its inability to implement further meaningful cost containment measures beyond those it undertook in the third quarter and the extremely difficult environment in which to obtain additional equity or debt financing, raise substantial doubt about its ability to continue as a going concern. JOSE JORGE: U.S. Trustee Unable to Form Creditors Committee ----------------------------------------------------------- Sara L. Kistler, the U.S. Trustee for Region 17, notified the U.S. Bankruptcy Court for the Eastern District of California that she was unable to appoint an official committee of unsecured creditors in the Chapter 11 case of Jose Jorge and Fatima Jorge. Gustine, California-based Jose Jorge -- dba Jose M. Jorge Dairy, dba Jorge Family Dairy -- operate two dairies as sole proprietor, one in California and one in Idaho. Jose Jorge filed for Chapter 11 bankruptcy protection on December 10, 2009 (Bankr. E.D. Calif. Case No. 09-62001). Hilton A. Ryder, Esq., who has an office in Fresno, California, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. KAINOS PARTNERS: Former CFO Faces 15 Years in Prison for Theft -------------------------------------------------------------- Claude Solnik at Long Island Business News reports that former chief financial officer Christopher Cortese has been charged with stealing $429,000 from Dunkin' Donuts franchise. Mr. Cortese faces up to 15 years in prison if convicted. About Kainos Partners Holding Company Greer, South Carolina-based Kainos Partners Holding Company, LLC - - http://www.kainospartners.com/-- operates the "donut-and- coffee" franchises. The Company and its affiliates filed for Chapter 11 on July 6, 2009 (Bankr. D. Del. Lead Case No. 09-12292). Two of its affiliates filed for separate Chapter 11 petitions on Sept. 15, 2009 (Bankr. D. Del. Case Nos. 09-13213 to 09-13214). An affiliate filed for separate Chapter 11 petition on Sept. 23, 2009 (Bankr. D. Del. Case No. 09-13285). Attorneys at the Law Offices of Joseph J. Bodnar represent the Debtors in their restructuring efforts. The Debtor did not file a list of 20 largest unsecured creditors. In its petition, the Debtors listed assets and debts both ranging from $10 million and $50 million. KIEBLER SLIPPERY: Wants to Have Until May 24 to Propose a Plan -------------------------------------------------------------- Kiebler Slippery Rock, L.L.C., asks the U.S. Bankruptcy Court for the Northern District of Ohio to extend its exclusive periods to propose and solicit acceptances of a proposed Chapter 11 plan until May 24, 2010. The Debtor relates that its exclusivity period expires on March 24, 2010. The Debtor needs additional time to negotiate with its secured lenders, the Official Committee of Unsecured Creditors, and other creditor constituencies, about a consensual plan. Chardon, Ohio-based Kiebler Slippery Rock LLC filed for Chapter 11 on Sept. 25, 2009 (Bankr. N.D. Ohio Case No. 09-19087). Andrew L. Turscak Jr., Esq., Mark A. Weintraub, Esq., and Robert C. Folland, Esq., at Thompson Hine LLP represent 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. KIWA BIO-TECH: Posts $516,933 Net Loss in Q3 2009 ------------------------------------------------- Kiwa Bio-Tech Products Group Corporation filed its quarterly report on Form 10-Q, showing a net loss of $516,933 on $1.4 million of revenue for the three months ended September 30, 2009, compared with a net loss of $567,770 on $2.3 million of revenue for the same period of 2008. The Company's balance sheet as of September 30, 2009, showed $4.7 million in assets and $10.9 million of debts, for a stockholders' deficit of $6.1 million. The Company had an accumulated deficit of $14.6 million and incurred net loss attributable to Kiwa shareholders of roughly $2.0 million during the nine months ended September 30, 2009. "This trend is expected to continue. These factors create substantial doubt about the Company's ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?579a Claremont, Calif.-based Kiwi Bio-Tech Products Group Corporation has have established two subsidiaries in China: (1) Kiwa Shandong in 2002, a wholly-owned subsidiary, engaging in bio-fertilizer business, and (2) Tianjin Kiwa Feed Co., Ltd. in July 2006, engaging in bio-enhanced feed business, of which the Company holds 80% equity. KPT ENTERPRISES: Court OKs Continued Access to Lenders' Cash ------------------------------------------------------------ The Hon. Marcia Phillips Parsons of the U.S. Bankruptcy Court for the Eastern District of Tennessee extended until March 16, 2010, KPT Enterprises, LLC's access to its lenders' cash collateral. The Debtor would use the money to fund its Chapter 11 case, pay suppliers and other parties. As reported in the Troubled Company Reporter on January 12, 2010, the Debtor leases the equipment to Morristown Driver's Service, Inc. In exchange for leasing the vehicles, MDS conducts all the maintenance on the equipment, pays the insurance and remits monthly payments to the Debtor. The Debtor is also authorized to continue using the tractors and trailers leased to MDS and the cash proceeds thereof and offers to provide adequate protection to the secured parties or purchase lessors. Insurance will be maintained on the equipment for the valuation currently at the level of $6,065,000. Insurance is generally reduced by an estimated valuation of $10,000 per month based on in-house evaluation. Adequate protection payments will be made in the amount of $20,000, which is in excess of two times the amount that the tractors and trailers are diminished in value, providing a continuing adequate protection payment to creditors. The Debtor proposes to increase payments in the same proportion to the extent that MDS increases rental payments to the Debtor. A replacement lien on the collateral and the equity cushion to the same extent, priority, and validity on the prepetition lien. Morristown, Tennessee-based KPT Enterprises, LLC, owns certain over-the-road tractors and trailer rigs which it utilizes in hauling freight on a commercial basis. The Company filed for Chapter 11 bankruptcy protection on December 30, 2009 (Bankr. E.D. Tenn. Case No. 09-53521). Dean B. Farmer, Esq., at Hodges, Doughty & Carson PLLC, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 in liabilities. LEHMAN BROTHERS: Elliot Management to Trade In Claims ----------------------------------------------------- Elliott Management Corp. seeks court approval to implement an information blocking process that would allow it to continue trading in claims against Lehman Brothers Holdings Inc. and its affiliated debtors. Matthew Gold, Esq., at Kleinberg Kaplan Wolf & Cohen PC, in New York, says the proposed process would ensure that Elliot would not violate its fiduciary duties as member of the Official Committee of Unsecured Creditors Committee even if it trades in securities and bank debt against the Debtors. "Although members of the [Creditors] Committee owe fiduciary duties to the creditors of these estates, Elliott also has fiduciary duties to maximize returns to its clients through trading securities," Mr. Gold says. He points out that Elliot may risk the loss of a beneficial investment opportunity for itself and its clients if barred from trading the claims during the pendency of the Debtors' bankruptcy cases. Mr. Gold adds the process would prevent Elliott's trading personnel from using or misusing nonpublic information obtained by its personnel who are engaged in Creditors Committee-related activities, and also would preclude them from receiving inappropriate information regarding Elliott's trading in the claims in advance of those trades. The proposed information blocking process is detailed in a declaration filed by Jonathan Pollock, Global Head of Situational Investing of Elliot, a copy of which is available for free at http://bankrupt.com/misc/LBHI_ElliotInfoBlockingProcess.pdf The Court will hold a hearing on March 17, 2010, to consider approval of the request. Deadline for filing objections is March 12, 2010. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: LBI Trustee Proposes Barclays-HWA Deal ------------------------------------------------------- James Giddens, the court-appointed trustee of Lehman Brothers Inc., asks the U.S. Bankruptcy Court for the Southern District of New York to approve a settlement between HWA 555 Owners LLC and Barclays Capital Inc. The deal was hammered out to settle the lawsuit HWA filed against LBI in 2009, which sought declaratory judgment that the LBI Trustee had assumed a lease agreement between the companies in connection with the sale of LBI's assets to Barclays. Under the deal, HWA will receive payment of $1 million from Barclays following approval of the settlement and will be granted an allowed administrative claim against LBI in the sum of $250,000. In return, HWA will dismiss the lawsuit against LBI. HWA, Barclays and the Trustee also agreed to release each other from all claims under the deal. The deal is formalized in a 9-page stipulation, a full-text copy of which is available without charge at: http://bankrupt.com/misc/LBHI_StipHWA&Barclays.pdf The Court will hold a hearing on March 23, 2010, to consider approval of the settlement. Deadline for filing objections is April 14, 2010. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Seeks to Hire Deloitte as Tax Advisor ------------------------------------------------------ Lehman Brothers Holdings Inc. and its affiliated debtors seek court approval to employ Deloitte Tax LLP as their tax services provider nunc pro tunc to November 1, 2008. As tax services provider, Deloitte is tasked to: (1) assist the Debtors in analyzing sales and use tax filings made for the years 2004 to 2008; (2) assist the Debtors in assessing returns and identifying instances of overpayment of either sales or use tax by the Debtors; (3) assist the Debtors in preparing claims for refund of any identified overpayments; (4) support the Debtors in reviewing these claims by interacting with the taxing authorities; (5) assist the Debtors in documenting their filing of a zero fixed base percentage with respect to their claim of a research and development credit on their tax return pursuant to Internal Revenue Code Section 41; (6) assist the Debtors in connection with tax matters related to their meal and entertainment expenditures for 2008; (7) assist the Debtors in connection with certain Internal Revenue Service and state examinations related to matters on which Deloitte has previously advised the Debtors; (8) assist the Debtors with respect to the maintenance of any licenses, registrations, or certificates with respect to a particular business line; (9) assist the Debtors with respect to tax matters related to FIN 48 issued by the Financial Accounting Standards Board; and (10) assist the Debtors with respect to tax matters related to specific transactions for which Deloitte had previously advised the Debtors. Deloitte will be paid of its services on an hourly basis and will be reimbursed for its expenses. The firm's professionals will be paid at these hourly rates: Professionals Hourly Rates ------------- ------------ Partner/Principal/Director $850 - $965 Senior Manager $675 - $825 Manager $550 - $700 Senior and Staff $200 - $560 The Debtors will also indemnify Deloitte for all claims excluding those stemming from gross negligence, bad faith or intentional misconduct of the firm. In a declaration, Samuel Lowenthal, a partner at Deloitte, assures the Court that his firm does not hold or represent any interest adverse to the Debtors The Court will hold a hearing on March 17, 2010, to consider approval of the proposed employment. Deadline for filing objections is March 12, 2010. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wants to Employ Kleyr as Special Counsel --------------------------------------------------------- Lehman Brothers Holdings Inc. and its affiliated debtors seek court approval to employ Luxembourg-based Kleyr Grasso Associes as their special counsel effective June 1, 2009. The Debtors tapped the firm to provide them legal assistance on matters concerning their subsidiaries or affiliates in Luxembourg. Prior to the proposed employment, Kleyr Grasso has served as "ordinary course" professional of the Debtors, assisting in particular their bankruptcy professionals in negotiations with the public prosecutor in Luxembourg to prevent compulsory liquidation of some Luxembourg-based Lehman units. Kleyr Grasso's fees and expenses, however, exceeded the $1 million compensation cap for ordinary course professionals, prompting the Debtors to retain the firm as a professional pursuant to Sections 327 and 328 of the Bankruptcy Code. Kleyr Grasso will be paid for its services on an hourly basis and will be reimbursed for its expenses. The firm's hourly rates are: Professionals Hourly Rates ------------- ------------ Partners EUR385 Senior Associates EUR275 Associates EUR235 Junior Associates EUR175 Marc Kleyr, Esq., at Kleyr Grasso, assures the Court that his firm does not hold or represent interest adverse to the Debtors or their estates. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wants to Hire Business Process Outsourcer ---------------------------------------------------------- Lehman Brothers Holdings Inc. and its affiliated debtors seek court approval to employ Omnium LLC as their business process outsourcer pursuant to Sections 105(a) and 363(b) of the Bankruptcy Code. The Debtors tapped the firm for their continued access to data processing and workflow automation support services. Currently, the Debtors depend on Barclays' personnel to help them access the information technology infrastructure to manage and service their assets pursuant to a transition services agreement, which is set to expire on March 22, 2010. The IT infrastructure was previously owned by the Debtors, which had been sold to Barclays Capital Inc. as part of the sale of their North American broker-dealer business. As business process outsourcer, Omnium will be tasked to provide data processing and workflow automation support services to the Debtors. Under a master services agreement with the Debtors, Omnium also agreed to provide technology to, among other things, support fund accounting and reporting, and to host a database that would serve as reference for information about certain classes of the Debtors' assets. Omnium will be paid for its services on an hourly basis and will be reimbursed for its expenses. The rate ranges from $225 an hour for staff members to $750 for managing directors during the implementation phase of the firm's services, and from $175 to $500 after the initial transition. The Debtors' attorney, Richard Krasnow, Esq., at Weil Gotshal & Manges LLP, in New York, says the proposed outsourcing would help the Debtors save about $13.5 million annually. Mr. Krasnow adds that Omnium's services will be limited to data processing and workflow automation, and that the firm is "not a professional person of the kind" contemplated by Section 327(a) of the Bankruptcy Code. The Court will hold a hearing on March 17, 2010, to consider approval of the proposed employment. Deadline for filing objections is March 12, 2010. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Wins Approval of GTH Settlement ------------------------------------------------ Lehman Brothers Holdings Inc. and its affiliated debtors obtained approval from Judge James Peck of the U.S. Bankruptcy Court for the Southern District of New York to enter into a settlement agreement with GTH LLC and GT Investment Company I, LLC. GT Investment is a wholly-owned, non-debtor subsidiary of LBHI established to hold membership interests in GTH LLC. GT Investment's only assets are its membership interests in GTH, and LBHI is its primary creditor. GT Investment initially acquired a membership interest in GTH in October 2007 and subsequently increased its interests pursuant to three additional investments. GT Investment has invested about $35 million and currently holds 3,429.71 Class A-1 Units or 20% of the equity of GTH. In October of 2008, GTH, a subprime mortgage loan servicer, raised an additional $70 million in capital by issuing five year convertible notes. While GT Investment was offered its contractually agreed-upon preemptive rights under the Limited Liability Company Agreement of GTH dated December 31, 2007, at that time, GT Investment declined to invest in the convertible notes based on concerns about GTH's long-term viability. The convertible notes contained a "full ratchet anti-dilution" provision, which was punitive to existing members of GTH, such as GT Investment, that did not exercise their pro rata participation rights to acquire convertible notes. GT Investment claimed it had a consent right under the Limited Liability Company Agreement and, pursuant to such claimed right, the company notified GTH that it did not consent to the issuance of the convertible notes, which was disputed by GTH. GT Investment did not pursue litigation with respect to the issuance of the convertible notes and, instead, initiated negotiations with GTH for, among other things, the acquisition by GTH of the Class A-1 Units. The Membership Interest Sale Transaction Subsequent to the Petition Date, the Debtors and their advisors identified these considerations in evaluating their options vis-a-vis GT Investment's interest in GTH: (1) Viability of GTH's business. As a general matter, market conditions for loan servicers will be challenging in the near term and the residual values for whole loan investments and securitizations have fallen and will continue to be unstable. Moreover, delinquency ratios have increased in GTH's portfolio and are expected to remain high in the near to medium term. Compounding these issues, the asset classes that GTH primarily focused on, manufactured housing loans, home equity lines of credit, and recreational vehicle loans, typically contain lower credit qualities. (2) Necessity of additional capital contribution. Based on a conservative estimate, GTH will require in excess of $100 million in additional capital in the near future to replace expiring debt facilities; replace a line of credit to cover margin calls on interest rate swaps; and acquire master servicing rights to grow its business. Given the full ratchet anti-dilution provision in the convertible notes, the Debtors would be forced to participate in the notes and provide additional funding to avoid having GT Investment's ownership interest in GTH significantly diluted. Based primarily on these considerations, the Debtors determined to seek a buyer for the Class A-1 Units, according to Lori Fife, Esq., at Weil Gotshal & Manges LLP, in New York. She points out, however, that the units are subject to certain transfer restrictions contained in the Limited Liability Company Agreement. Seeking to avoid the delay and expense inherent in challenging the transfer restrictions, the Debtors reached out to GTH to determine the company's interest in repurchasing the Class A-1 Units, Ms. Fife relates. Following negotiations, LBHI, GTH and GT Investment entered into a purchase agreement dated April 13, 2009, under which GT Investment consented to sell the Class A-1 Units to GTH for $17 million, and withdraw as a member of GTH. In turn, GTH will purchase the Class A-1 Units from GT Investment and will immediately cancel all such units, extinguishing any interests and obligations that GT Investment may have had in GTH. As a result, all rights, powers and privileges granted by the Limited Liability Company Agreement to LBHI, as sole member of GT Investment, will be terminated. The Purchase Agreement contains important provisions, one of which requires that GT Investment and LBHI deliver a release to GTH. The Release contemplates that GT Investment and LBHI will waive any claims that may have accrued to them pursuant to the issuance or the terms of the convertible notes. It does not release, however, any obligations of Lehman pursuant to Flow Subservicing Agreements that Lehman Capital and Lehman Brothers Bank, FSB signed with Green Tree Servicing LLC. The Purchase Agreement also contains certain provisions regarding the non-solicitation of alternative transactions and further assurances. Specifically, section 9.1(a) of the Purchase Agreement provides that GT Investment and LBHI should not directly or indirectly: (1) solicit, participate or continue to participate in any discussion or negotiations with any person other than GTH regarding the sale of the Class A-1 Units; the sale of the equity of GT Investment; the merger, reorganization, amalgamation, dissolution or similar transaction involving GT Investment; or any "alternative transaction" involving GT Investment or its assets that would impede, delay, impair or prevent, or be competitive with, the transactions contemplated by the Purchase Agreement; (2) enter into or agree to enter into any agreement with respect to any alternative transaction; or (3) furnish to any person any information, or take any other action to facilitate any inquiries or the making of any proposal, with respect to any alternative transaction. The Purchase Agreement also contains a "non-interference provision," which requires GTH, GT Investment and LBHI to execute and deliver all additional instruments and agreements, and to take such further actions in order to evidence or carry out the provisions of the Purchase Agreement or to consummate the transactions contemplated therein. According to Ms. Fife, each of the parties agrees not to take any action that would result in any of the conditions set in the Purchase Agreement not being satisfied or satisfaction of those conditions being materially delayed. From April 13, 2009, and following the closing of the sale of the Class A-1 Units, GT Investment and LBHI agree not to take, directly or indirectly, any action in the chapter 11 cases or otherwise that would adversely impact GTH with respect to the transactions contemplated by the Purchase Agreement, Ms. Fife relates. "In the case of a breach of the non-interference provision of the Purchase Agreement by LBHI, GTH's remedies are limited to equitable relief in the form of an injunction or specific performance," Ms. Fife says. By this motion, the Debtors seek the Court's authority to enter into the Release and the non-interference provision; and take all corporate actions necessary to comply with their other obligations under the Purchase Agreement. "From LBHI's perspective, the Release benefits its estate by eliminating the estate's exposure to GTH by terminating LBHI under the [Limited Liability Company Agreement]," Ms. Fife says. These obligations, Ms. Fife says, include LBHI's covenant to (i) own, directly or indirectly, 100% of the membership interests in GT Investment, and cause GT Investment to comply with its obligations under the Limited Liability Company Agreement. "The only prospective claims [GT Investment] and LBHI are aware that they will be giving up, pursuant to the Release, are claims related to the issuance of the [convertible notes]. Any resolution of that issue would likely entail litigation that would be costly, time consuming and, even if successful, damaging to the value of [GT Investment's] interest in GTH," Ms. Fife further says. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LEHMAN BROTHERS: Vernon Healy Files Investor Claim Against UBS -------------------------------------------------------------- The Vernon Healy investor advocacy law firm filed an $800,000 claim March 9 against UBS and accused the brokerage of committing gross misconduct when it marketed and sold $800,000 worth of Lehman principal protected notes to a Houston businessman as a safe and conservative "principal protected" investment in November 2007. UBS designed the Lehman structured product and marketed it to its customers as safe and 100 percent "principal protected" even though in reality, the principal protected notes were essentially an unsecured loan to now-bankrupt Lehman Brothers, according to the Vernon Healy claim filed. The claim, filed before FINRA, the Financial Industry Regulatory Authority, seeks compensatory and punitive damages against UBS on behalf of the investor. The Vernon Healy law firm has filed almost $2 million in claims against UBS on behalf of Lehman note investors in the past month alone. These UBS-designed investment products supplied Lehman Brothers (Pink Sheets:LEHMQ) with an infusion of unsecured loans from main street investors as Lehman Brothers' solvency became a concern, according to the claim. The Lehman Brothers bankruptcy in September 2008 left Lehman note holders standing essentially at the back of the line as unsecured creditors. After Lehman declared bankruptcy, the Texas investor received his October 2008 monthly statement, which dropped the value of the investment from $818,000 to zero, the claim states. This complete loss of valuation was contrary to the representation by UBS that the structured product was "principal protected," according to the claim. As the architect of these particular Lehman structured products, UBS knew or should have known of Lehman's precarious financial position, but UBS urged its financial advisors to sell Lehman principal protected notes as safe to their clients, according to the claim. Written material obtained by Vernon Healy as part of its pre- filing investigation shows that UBS disseminated misleading product descriptions to its financial advisors that portrayed the Lehman notes as investments that put none of the investor's principal at risk, the claim states. New Hampshire securities regulators have taken action against UBS for deceptive practices involving Lehman Brothers Asian Currency Basket Principal Protected Notes, the same product sold to the Texas investor filing today's claim. International investors, particularly from the UK, were pitched Lehman structured notes by affiliates of Credit Suisse, Citi Bank and UBS. Vernon Healy is a Naples, Florida law firm that represents investors who are victims of stock fraud and stock losses due to broker fraud and brokerage firm fraud and misconduct. Vernon Healy securities attorneys are experienced in securities arbitration and business litigation and assist clients in recovering losses caused by all manner of financial fraud and negligence. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LIFE FUND: Jeff Marwil Confirmed as Chapter 11 Trustee ------------------------------------------------------ Judge A. Benjamin Goldgar of the United States Bankruptcy Court in Chicago confirmed a creditors' election of Jeff Marwil as chapter 11 trustee in the consolidated cases of Life Fund, 5.1 LLC; Life Fund, 5.2, LLC; Houston Tanglewood Partners, LLC; A&O Resource Management, LP.; A&O Life Fund, LLC; A&O Bonded Life Assets, LLC; and A&O Bonded Life Settlement, LLC, overruling the objections of the U.S. Trustee's Office and of the original chapter 11 trustee, Patrick Collins, who was appointed by the U.S. Trustee's Office at the beginning of the bankruptcy case. Jeff Marwil is an attorney with Proskauer, Rose in Chicago. The cases involve over 722 investors in bonded, life settlement contracts who appear to have been defrauded in their investment. The bankruptcy estates, however, include sizeable interests in life insurance policies. Most of the investors live in Texas. The election of Mr. Marwil was invoked and won by a Group of Investors represented by Houston counsel Deborah J. Fritsche and Lori Hood with the Johnson, Trent, West & Taylor law firm, and local Chicago counsel Brian M. Graham of SmithAmundsen. Johnson Trent and SmithAmundsen are members of USLAW NETWORK, a national organization composed of over 60 independent, defense-based law firms with over 4,000 attorneys covering the United States and Mexico. At Johnson Trent, a successful legal practice is measured by the outcomes achieved for clients. Respecting client needs and understanding their business is at the heart of what we do. It is critical to immerse ourselves in our clients' businesses -- taking on complex matters in order to exceed client expectations. With more than 25 litigators, we have the depth to serve all civil litigation needs. LINEAR TECHNOLOGY: Capital World Holds 11.1% of Common Stock ------------------------------------------------------------ Capital World Investors in Los Angeles, California, disclosed that as of December 31, 2009, it may be deemed to beneficially own 24,835,174 shares or roughly 11.1% of the common stock of Linear Technology Corporation. Milpitas, California-based Linear Technology Corporation (NASDAQ- LLTC) -- http://www.linear.com/-- manufactures high performance linear integrated circuits, including high performance amplifiers, comparators, voltage references, monolithic filters, linear regulators, DC-DC converters, battery chargers, data converters, communications interface circuits, RF signal conditioning circuits, uModuleO products, and many other analog functions. Linear Technology reported $1.512 billion in total assets and $1.627 billion in total liabilities resulting to a $114 million in stockholders' deficit as of December 27, 2009. LINEAR TECHNOLOGY: Growth Fund Holds 8.9% of Common Stock --------------------------------------------------------- The Growth Fund of America, Inc., in Los Angeles, California, disclosed that as of December 31, 2009, it may be deemed to beneficially own 9,850,000 shares or roughly 8.9% of the common stock of Linear Technology Corporation. The Growth Fund of America is an investment company registered under the Investment Company Act of 1940. It is advised by Capital Research and Management Company. CRMC manages equity assets for various investment companies through two divisions, Capital Research Global Investors and Capital World Investors. These divisions generally function separately from each other with respect to investment research activities and they make investment decisions and proxy voting decisions for the investment companies on a separate basis. Milpitas, California-based Linear Technology Corporation (NASDAQ- LLTC) -- http://www.linear.com/-- manufactures high performance linear integrated circuits, including high performance amplifiers, comparators, voltage references, monolithic filters, linear regulators, DC-DC converters, battery chargers, data converters, communications interface circuits, RF signal conditioning circuits, uModuleO products, and many other analog functions. Linear Technology reported $1.512 billion in total assets and $1.627 billion in total liabilities resulting to a $114 million in stockholders' deficit as of December 27, 2009. LINEAR TECHNOLOGY: State Farm Mutual Holds 7.35% of Common Stock ---------------------------------------------------------------- Bloomington, Illinois-based State Farm Mutual Automobile Insurance Company and its affiliates disclosed that as of December 31, 2009, they may be deemed to beneficially own in the aggregate 16,736,064 shares or roughly 7.35% of the common stock of Linear Technology Corporation. Milpitas, California-based Linear Technology Corporation (NASDAQ- LLTC) -- http://www.linear.com/-- manufactures high performance linear integrated circuits, including high performance amplifiers, comparators, voltage references, monolithic filters, linear regulators, DC-DC converters, battery chargers, data converters, communications interface circuits, RF signal conditioning circuits, uModuleO products, and many other analog functions. Linear Technology reported $1.512 billion in total assets and $1.627 billion in total liabilities resulting to a $114 million in stockholders' deficit as of December 27, 2009. LIONS GATE: S&P Changes Outlook to Negative; Affirms 'B-' Rating ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its rating outlook on British Columbia-domiciled and Santa Monica, California- headquartered Lions Gate Entertainment Corp. and its subsidiary, Lions Gate Entertainment Inc., to negative from stable. At the same time, S&P affirmed ratings on Lions Gate, including the 'B-' corporate credit rating. "The outlook change is in response to the announcement of an unsolicited tender offer from Carl Icahn to acquire up to 13.2 million of Lions Gate's common shares," explained Standard & Poor's credit analyst Deborah Kinzer. Together with the stock Mr. Icahn already owns, this would increase his stake to about 29.9% of the company's outstanding common shares. Lions Gate's bank agreements contain a change-of- control event of default, in which a change of control is defined as ownership of more than 20% of the company's common shares. A successful tender offer by Mr. Icahn, therefore, could trigger an event of default, which Lions Gate's banks could decide not to waive. Conversely, the company could take actions to fend off his efforts but that could cause its credit measures to deteriorate from their already weak levels. S&P's 'B-' rating on Lions Gate reflects the company's high debt leverage and negative discretionary cash flow, volatile EBITDA, limited liquidity, and track record of growth through acquisition. Minimally offsetting these factors are the company's position as an important U.S. film producer, its film and TV library of about 12,000 titles, and some degree of business diversification provided by its TV production operations and fledgling media networks investments. For the 12 months ended Dec. 31, 2009, lease-adjusted EBITDA coverage of total interest was thin at 1.4x, and EBITDA coverage of cash interest was slightly better, at 1.8x. Lease-adjusted debt (excluding TV Guide Network mandatorily redeemable preferred stock) to EBITDA as of Dec. 31, 2009, was high, at 10x. When film financing is included in debt, lease-adjusted leverage rises to 17x. Discretionary cash flow was negative for the 12 months ended Dec. 31, 2009, because of film investments that operations could not finance. LOWER BUCKS: Has Access to Bondholders' Cash Until April 2 ---------------------------------------------------------- The Hon. Eric L. Frank of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania, in a second interim order, authorized Lower Bucks Hospital, et al., to use the cash securing repayment of loan with The Bank of New York Mellon Trust Company, N.A., until April 2, 2010. The Bank of New York Mellon Trust Company, N.A., is the trustee for the Borough of Langhorne Manor Higher Education and Health Authority Hospital Revenue Bonds, Series of 1992. A final hearing on the Debtors' access to the cash collateral will be held on March 31, 2010, at 11:00 a.m. Objections, if any, are due on March 29, 2010. The Debtors would use the money to fund their Chapter 11 case, pay suppliers and other parties. As of the petition date, the aggregate amount of prepetition indebtedness is $24,870,000, exclusive of any interest and other amounts that may be due and owing. In exchange for using the cash collateral, the Debtors will grant the prepetition lenders (i) a replacement lien in unrestricted gross revenues received by the Lower Buck Hospital subsequent to the Petition Date; (ii) a lien on and security interest in LBH's real estate, subject to that certain lien of the Township of Bristol in the principal amount of $133,000; and (iv) a superpriority claim. The liens and superpriority expense claims are subject to carve out covering fees payable to the U.S. Trustee and the Clerk of the Bankruptcy Court, and unpaid professional fees, among others. About Lower Bucks Hospital Bristol, Pennsylvania-based Lower Bucks Hospital is a nonprofit hospital based in Bristol, Pennsylvania. The Hospital is currently licensed to operate 183 beds. Together with affiliates Advanced Primary Care Physicians and Lower Bucks Health Enterprises, Inc., Lower Bucks owns a 36-acre campus with several medical facilities. The Hospital's emergency room serves approximately 30,000 patients annually. For the fiscal year ending June 30, 2009, Lower Bucks had $114 million in consolidated revenues. The Hospital filed for Chapter 11 bankruptcy protection on January 13, 2010 (Bankr. E.D. Pa. Case No. 10-10239). The Hospital's affiliates -- Lower Bucks Health Enterprises, Inc, and Advanced Primary Care Physicians also filed Chapter 11 petitions. Jeffrey C. Hampton, Esq., and Adam H. Isenberg, at Saul Ewing LLP, assist the Hospital in its restructuring effort. Donlin, Recano & Company, Inc., is the Hospital's claims and notice agent. The Hospital listed $50,000,001 to $100,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. LYONDELL CHEMICAL: Parent Reports $317MM Operating Income for 2009 ------------------------------------------------------------------ LyondellBasell Industries AF S.C.A. posted quarterly financial results and for full year ended December 31, 2009. The report was prepared on February 28, 2010, but was made available on LyondellBasell's Web site on March 1, 2010. LyondellBasell had a loss from continuing operations of $852 million in the fourth quarter 2009 compared to $649 million in the third quarter 2009 as lower underlying operating results were more than offset by the effects of lower reorganization and impairment charges. Underlying operating results were lower in the fourth quarter 2009 due to lower margins on chemical products and the effect of lower oxyfuels sales volumes and margins. The fourth quarter 2009 loss included after tax charges of $644 million and $11 million related to reorganization items and impairments, compared to $603 million and $140 million in the third quarter 2009. The fourth quarter 2009 impairment charges primarily related to emissions allowances, while the third quarter 2009 impairment charges related to the carrying value of certain equity investments as a result of weak current and projected market conditions. As to its full year 2009 results, LyondellBasell had operating income of $317 million in 2009 compared to an operating loss of $5,928 million in 2008. Results in 2009 compared to 2008 reflected the benefits of LyondellBasell's cost reduction program, offset by the unfavorable effects of lower product margins, sales volumes, and currency exchange rates on non-U.S. operating income. In contrast, results in 2008 were impacted by charges of $4,982 million and $225 million for impairment of goodwill related to the December 20, 2007 acquisition of Lyondell Chemical Company by Basell AF S.C.A., and the carrying value of the Berre Refinery; and a charge of $1,256 million to adjust LyondellBasell's inventory to market value. Moreover, LyondellBasell had a loss from continuing operations of $2,866 million in 2009 compared to a loss from continuing operations of $7,336 million in 2008. In 2009, the loss from equity investments for the O&P - EAI segment included charges of $228 million for impairment of the carrying value of LyondellBasell's equity investments in certain joint ventures. A full-text copy of LyondellBasell's Full Year 2009 Results is available for free at http://ResearchArchives.com/t/s?55b7 A full-text copy of LyondellBasell's discussion on the Full Year 2009 Results is available for free at: http://ResearchArchives.com/t/s?55b8 LyondellBasell Industries AF S.C.A Consolidated Balance Sheets As of December 31, 2009 Assets Current assets: Cash and cash equivalents $558,000,000 Short-term investments 11,000,000 Accounts receivable: Trade, net 3,092,000,000 Related parties 195,000,000 Inventories 3,277,000,000 Prepaid expenses and other current assets 1,133,000,000 ---------------- Total current assets 8,266,000,000 Property, plant and equipment, net 15,152,000,000 Investments and long-term receivables: Investment in PO joint ventures 922,000,000 Equity investments 1,085,000,000 Other investments and long-term receivables 112,000,000 Intangible assets, net 1,861,000,000 Other assets 363,000,000 ---------------- Total assets $27,761,000,000 ================ Liabilities and Equity Liabilities not subject to compromise: Current liabilities: Current maturities of long-term debt $497,000,000 Short-term debt 6,182,000,000 Accounts payable: Trade 1,627,000,000 Related parties 501,000,000 Accrued liabilities 1,390,000,000 Deferred income taxes 170,000,000 ---------------- Total current liabilities 10,367,000,000 Long-term debt 305,000,000 Other liabilities 1,361,000,000 Deferred income taxes 2,081,000,000 Commitments and contingencies - Liabilities subject to compromise 22,494,000,000 Stockholders' equity: Common stock 60,000,000 Additional paid-in capital 563,000,000 Retained deficit (9,313,000,000) Accumulated other comprehensive loss (286,000,000) ---------------- LBI's share of stockholders deficit (8,976,000,000) Non-controlling interests 129,000,000 ---------------- Total deficit (8,847,000,000) ---------------- Total liabilities and equity $27,761,000,000 ================ LyondellBasell Industries AF S.C.A. Unaudited Consolidated Statement of Income For the Year Ended December 31, 2009 Sales and other operating revenues: Trade $30,207,000,000 Related parties 621,000,000 ---------------- 30,828,000,000 Operating costs and expenses: Cost of sales 29,372,000,000 Inventory valuation adjustment 127,000,000 Impairments 17,000,000 Selling, general and administrative expenses 850,000,000 Research and development expenses 145,000,000 ---------------- 30,511,000,000 ---------------- Operating income 317,000,000 Interest expense (1,795,000,000) Interest income 18,000,000 Other income, net 325,000,000 ---------------- Income (loss) from continuing operations before equity investments, reorganization items and income taxes (1,135,000,000) Loss from equity investments (181,000,000) Reorganization items (2,961,000,000) ---------------- Loss from continuing operations before income taxes (4,277,000,000) Provision for (benefit from) income taxes (1,411,000,000) ---------------- Loss from continuing operations (2,866,000,000) Income from discontinued operations, net of tax 1,000,000 ---------------- NET LOSS ($2,865,000,000) ================ LyondellBasell Industries AF S.C.A. Consolidated Statement of Cash Flow For the Year Ended December 31, 2009 Cash flows from operating activities: Net income (loss) ($2,865,000,000) (Income) loss from discontinued operations, net of tax (1,000,000) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities - continuing operations: Depreciation and amortization 1,774,000,000 Asset impairments 17,000,000 Amortization of debt-related costs 347,000,000 Inventory valuation adjustment 127,000,000 Equity investments - Equity (income) loss 181,000,000 Distributions of earnings 26,000,000 Deferred income taxes (1,399,000,000) Reorganization items 2,961,000,000 Reorganization-related payments (340,000,000) Unrealized foreign currency exchange gains (193,000,000) Purchased in-process research and development - Changes in assets and liabilities that provided (used) cash: Accounts receivable (129,000,000) Inventories (40,000,000) Accounts payable 99,000,000 Repayment of accounts receivable securitization facility (503,000,000) Accrued interest (19,000,000) Prepaid expenses and other current assets (329,000,000) Other, net (661,000,000) ---------------- Net cash used in operating activities - continuing operations (788,000,000) Net cash provided by operating activities - discontinued operations 1,000,000 ---------------- Net cash used in operating activities (787,000,000) ---------------- Cash flows from investing activities: Expenditures for property, plant and equipment (779,000,000) Proceeds from insurance claims 120,000,000 Acquisition of businesses, net of cash and debt acquired - Contributions and advances to affiliates (4,000,000) Proceeds from disposal of assets 20,000,000 Short-term investments 23,000,000 Other 9,000,000 ---------------- Net cash used in investing activities (611,000,000) ---------------- Cash flows from financing activities: Net proceeds from issuance of DIP term loan facility 1,992,000,000 Proceeds from note payable 100,000,000 Repayment of note payable (100,000,000) Repayment of DIP term loan facility (6,000,000) Net borrowings under DIP revolving credit facility 325,000,000 Net borrowings (repayments) under prepetition revolving credit facilities (766,000,000) Net repayment on revolving credit facilities (298,000,000) Proceeds from short-term debt 42,000,000 Repayment of short-term debt (6,000,000) Issuance of long-term debt - Repayment of long-term debt (68,000,000) Payment of debt issuance costs (93,000,000) Changes in restricted cash - Dividends paid - Other, net (21,000,000) ---------------- Net cash provided by financing activities 1,101,000,000 ---------------- Effect of exchange rate changes on cash (3,000,000) ---------------- Decrease in cash and cash equivalents (300,000,000) Cash and cash equivalents at beginning of period 858,000,000 ---------------- Cash and cash equivalents at end of period $558,000,000 ================ LyondellBasell's selected financial data for the fourth quarter ended December 31, 2009 are: Sales and other operating revenues $5,900,000,000 Operating income (loss) (141,000,000) Income (loss) from equity investments (20,000,000) Reorganization items (948,000,000) Net income (loss) (1,016,000,000) About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. It is the global leader in polyolefins technology, production and marketing; a pioneer in propylene oxide and derivatives; and a significant producer of fuels and refined products, including biofuels. Through research and development, LyondellBasell develops innovative materials and technologies that deliver exceptional customer value and products that improve quality of life for people around the world. Headquartered in The Netherlands, LyondellBasell -- http://www.lyondellbasell.com/-- is privately owned by Access Industries. Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. On January 6, 2009, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc. filed for Chapter 11. In May 2009, one of the cases was dismissed -- Case No. 09-10068 -- because it is duplicative of Case No. 09- 10040 relating to Debtor Glidden Latin America Holdings. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Lyondell has obtained approximately US$8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a US$6.5 billion term loan, which comprises a US$3.25 billion in new loans and a US$3.25 billion roll-up of existing loans; and a US$1.57 billion asset-backed lending facility. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009, in order to seek protection against claims by certain financial and U.S. trade creditors. On May 8, 2009, LyondellBasell Industries added 13 non-operating entities to Lyondell Chemical Company's reorganization filing under Chapter 11 of the U.S. Bankruptcy Code. All of the entities are U.S. companies and were added to the original Chapter 11 filing for administrative purposes. The filings will have no impact on current business or operations as none of the entities manufactures or sells products. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LYONDELL CHEMICAL: Proposes Lender Litigation Settlement -------------------------------------------------------- In a joint request, Lyondell Chemical Co. and its units and the Official Committee of Unsecured Creditors ask the Court to approve a revised Lender Litigation Settlement they entered into with: (i) Financing Party Defendants consisting of Citibank, N.A.; Citibank International plc; and Citigroup Global Markets Inc.; Goldman Sachs Credit Partners, L.P. and Goldman Sachs International;, Merrill, Lynch, Pierce, Fenner & Smith and Merrill Lynch Capital Corporation; ABN AMRO Inc. and The Royal Bank of Scotland, N.V., f/k/a ABN Amro Bank N.V.; UBS Securities LLC and UBS Loan Finance LLC; LeverageSource III S.a.r.l.; Ares Management LLC; Bank of Scotland, DZ Bank AG; Kolberg Kravis Roberts & Co. (Fixed Income) LLC and UBS AG; (ii) Wilmington Trust Company as trustee for 8.375% senior notes due 2015 in the principal amounts of $615 million and EUR500 million issued pursuant to a 2015 Notes Indenture; and (iii) an ad hoc group of 2015 Noteholders composed of Arrowgrass Master Fund Ltd.; Arrowgrass Distressed Opportunities Fund Limited; Basso Credit Opportunities Holding Fund Ltd.; Basso Fund Ltd.; Basso Multi-Strategy Holding Fund Ltd.; Columbus Hill Partners, L.P.; Columbus Hill Overseas, Ltd.; CQS Directional Opportunities Master Fund Limited; Kivu Investment Fund Limited; Mariner LDC; Caspian Capital Partners, LP; Caspian Select Credit Master Fund, Ltd.; CVI GVF (Lux) Master S.a.r.l.; Fortelus Special Situations Master Fund Ltd., and Panton Master Fund, L.P. The Debtors and Creditors Committee note that their request supersedes the original Lender Litigation Settlement Motion dated December 24, 2009; the Creditors Committee's objection; and the Debtors' reply with respect to the Lender Litigation Settlement. Counsel to the Debtors, George A. Davis, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, relates that the Revised Settlement resolves all claims brought by the Creditors Committee in an action against the Financing Party Defendants as a result of a December 20, 2007 merger of Lyondell Chemical Company and Basell AF S.C.A. The Revised Settlement will provide eligible unsecured creditors with a significant guaranteed recovery and the opportunity to capture substantial additional recovery through future litigation against the defendants in the Committee Action who are not party to the Revised Settlement and other matters, he notes. Mr. Davis discloses that the Debtors, the Creditors Committee, the Financing Party Defendants, Wilmington Trust Company, and the 2015 Notes Ad Hoc Group engaged in extensive further negotiations and have made substantial progress toward resolution of the few issues that remained open at the time the Revised Settlement was announced on February 16, 2010. All major terms of the settlement appear to have been resolved and the parties are very close to execution of definitive documentation for the settlement agreement, he says. Until that definitive documentation is finalized, however, the parties to the Revised Settlement reserve all rights as to both the agreement and related proposed order, he relates. The salient terms of the Revised Settlement are: (a) dismissal of all claims asserted against the Financing Party Defendants and Secured Lenders in the Committee Action and in the complaint in intervention of Bank of New York Mellon, and releases of these claims; (b) dismissal of all claims asserted by Wilmington Trust in the adversary proceeding against LyondellBasell Industries AF S.C.A.; (c) $450 million in settlement consideration, to be distributed on the effective date of any plan of reorganization to holders of General Unsecured Claims against Debtors that are subject to the Financing Party Defendants' secured or unsecured claims, including to holders of 2015 Notes Claims. The $450 million consists of (i) $300 million in cash, and (ii) $150 million in Class A Shares of New Topco, funded by a $75 million reduction in the equity to be received by each of the Senior Secured Claim class and the Bridge Loan Claim class under the Debtors' Third Amended Joint Plan of Reorganization; (d) contribution to the Debtors' estates of the Financing Party Defendants' right to enforce all subordination and turnover provisions against the 2015 Noteholders pursuant to a December 20, 2007 Intercreditor Agreement; (e) discontinuance by the Debtors of claims asserted pursuant to Section 544 of the Bankruptcy Code in the Committee Action against former shareholders of pre-Merger Lyondell except for those claims against Access Industries and the director defendants in the Committee Action and abandonment by the Debtors of their rights to further pursue these claims. (f) a provision in the Amended Plan, for contribution by holders of General Unsecured Claims, the deficiency claims of the Secured Lenders and 2015 Notes Claims to a "Creditor Trust" of the state law claims of these holders for the avoidance of prepetition transfers by the Debtors; that Trust will be established for purposes of prosecution of the state law avoidance claims and distribution of proceeds of the claims; (g) transfer of (i) all remaining claims asserted in the Committee Action, and (ii) certain preference actions, to a "Litigation Trust" to be established under the Amended Plan for the purposes of prosecution and distribution of proceeds; (h) an order barring claims for contribution against settling defendants in the Committee Action and related provisions for the reduction of judgments against defendants who are not party to the Revised Settlement; (i) the agreement by holders of deficiency claims on account of Senior Secured Claims and Bridge Loan Claims that recoveries on account of these claims from settlement consideration are possible only from recoveries obtained by the Creditor Trust and the Litigation Trust, in the aggregate, in excess of the amounts needed to satisfy General Unsecured Claims and 2015 Notes Claims in full; (j) the grant of $20 million by the Debtors to fund the Creditor Trust and the Litigation Trust; (k) payment, as allowed administrative expenses, of certain fees and expenses of Wilmington Trust and the 2015 Notes Ad Hoc Group; (l) continued payment and reimbursement of the expenses of the prepetition agents; (m) indemnification of Deutsche Bank Trust Company as administrative agent under a Senior Secured Credit Agreement with the Debtors and Merrill Lynch Capital Corporation for actions taken to effectuate the transactions contemplated by the Revised Settlement; (n) elimination of the $250,000 limitation imposed by the DIP Financing Order upon the payment of the fees and expenses of the Creditors Committee in connection with investigating and prosecuting the claims asserted in the Committee Action, which will be payable subject to the compensation procedures established in the Debtors' Chapter 11 cases; (o) support, by the Creditors Committee, Wilmington Trust, and the 2015 Notes Ad Hoc Group, of the Amended Plan or any other plan proposed by the Debtors that is consistent with the Revised Settlement; and (p) withdrawal of any and all pending objections to the Amended Plan, its related disclosure statement, and the Debtors' motion to approve the Equity Commitment Agreement by the Creditors Committee, Wilmington Trust and the 2015 Notes Ad Hoc Group subject to refiling only in the event the order approving the Revised Settlement is vacated, reversed, modified or amended prior to the date of payment of the $450 million under the Revised Settlement. Mr. Davis asserts that approval of the Revised Settlement will permit the Debtors to obtain the benefits of Chapter 11 by moving on an expedited basis towards emergence from bankruptcy. He assures the Court that the Revised Settlement satisfies every relevant test for approval of compromise under Rule 2019 of the Federal Rules of Bankruptcy Procedure because it: * represents a reasonable balance between the risks of litigating the underlying disputes and the concrete benefits of settlement; * avoids multiple protracted litigations and provides certain recoveries; * benefits many different unsecured creditor constituencies as well as the Debtors' estates as a whole by advancing the reorganization process; * is supported by an overwhelming majority of the relevant parties-in-interest; and * is the product of arm's-length negotiations between the Debtors, the Creditors Committee, Wilmington Trust and the Financing Party Defendants, among others. The effectiveness of the Revised Settlement is subject to the entry by the Court of an order granting the Joint Motion and approving the Revised Settlement, Mr. Davis clarifies. The Court will convene a hearing to consider the Joint Motion on March 11, 2010. Objections are due March 9. About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. It is the global leader in polyolefins technology, production and marketing; a pioneer in propylene oxide and derivatives; and a significant producer of fuels and refined products, including biofuels. Through research and development, LyondellBasell develops innovative materials and technologies that deliver exceptional customer value and products that improve quality of life for people around the world. Headquartered in The Netherlands, LyondellBasell -- http://www.lyondellbasell.com/-- is privately owned by Access Industries. Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. On January 6, 2009, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc. filed for Chapter 11. In May 2009, one of the cases was dismissed -- Case No. 09-10068 -- because it is duplicative of Case No. 09- 10040 relating to Debtor Glidden Latin America Holdings. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Lyondell has obtained approximately US$8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a US$6.5 billion term loan, which comprises a US$3.25 billion in new loans and a US$3.25 billion roll-up of existing loans; and a US$1.57 billion asset-backed lending facility. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009, in order to seek protection against claims by certain financial and U.S. trade creditors. On May 8, 2009, LyondellBasell Industries added 13 non-operating entities to Lyondell Chemical Company's reorganization filing under Chapter 11 of the U.S. Bankruptcy Code. All of the entities are U.S. companies and were added to the original Chapter 11 filing for administrative purposes. The filings will have no impact on current business or operations as none of the entities manufactures or sells products. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LYONDELL CHEMICAL: Rejects Reliance's $14.5 Bil. Bid ---------------------------------------------------- LyondellBasell Industries rejected Reliance Industries, Ltd.'s $14.5 billion bid for the Company's assets, Bloomberg News reports, citing two people briefed on the matter. A creditor group led by Apollo Management, the private-equity firm founded by Len Blavatnik, was said to have rejected Reliance's bid, The New York Post reports, citing three Lyondell Chemical Company creditors. Rejection of Reliance's bid will help position Apollo Management to merge Lyondell with its Hexion Specialty Chemicals, The Post discloses. One Lyondell creditor commented that Apollo knows Lyondell is really valuable and Reliance is making a mistake by not offering more, The Post says. Similarly, another Lyondell creditor related that Reliance's offer values $8 billion of the most senior Lyondell debt about $2 billion less than where it's trading, The Post adds. Reliance previously increased its bid for LyondellBasell's assets from $13 billion to $14.5 billion, but Lyondell creditors think Reliance's bid is too low, The Post notes. "Reliance is a value buyer," said Telly Zachariades, partner of the Valence Group investment bank, The Post reports. "Indian billionaire Mukesh Ambani is not the kind of person to get caught up in deal frenzy," Mr. Zachariades added. Reliance will not Increase $14.5 billion bid, Says Source Reliance, however, does not intend to raise its bid again for LyondellBasell, Dow Jones Newswires reports, citing a person close to the deal who said that market conditions did not justify that. "Anything that erodes shareholder value is not good," Jigar Shah of research firm Kim Eng Securities, was quoted as saying. "It's better that the company goes for a more judicious acquisition rather than pay a hefty price," Mr. Shah added, Dow Jones Newswires relates. Mr. Shah relates that Reliance may now look toward other acquisitions, notes the report. Indeed, an Economic Times report discloses that Reliance is eyeing Canada's Value Creation, Inc. as its next possible acquisition. A source close to Reliance said that the company's bid for LyondellBasell "is proving to be expensive, The Economic Times says. Reliance has time to raise its bid but given the past record of seeking value in all its purchases, it may not raise the bid, says The Economic Times. About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. It is the global leader in polyolefins technology, production and marketing; a pioneer in propylene oxide and derivatives; and a significant producer of fuels and refined products, including biofuels. Through research and development, LyondellBasell develops innovative materials and technologies that deliver exceptional customer value and products that improve quality of life for people around the world. Headquartered in The Netherlands, LyondellBasell -- http://www.lyondellbasell.com/-- is privately owned by Access Industries. Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. On January 6, 2009, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc. filed for Chapter 11. In May 2009, one of the cases was dismissed -- Case No. 09-10068 -- because it is duplicative of Case No. 09- 10040 relating to Debtor Glidden Latin America Holdings. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Lyondell has obtained approximately US$8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a US$6.5 billion term loan, which comprises a US$3.25 billion in new loans and a US$3.25 billion roll-up of existing loans; and a US$1.57 billion asset-backed lending facility. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009, in order to seek protection against claims by certain financial and U.S. trade creditors. On May 8, 2009, LyondellBasell Industries added 13 non-operating entities to Lyondell Chemical Company's reorganization filing under Chapter 11 of the U.S. Bankruptcy Code. All of the entities are U.S. companies and were added to the original Chapter 11 filing for administrative purposes. The filings will have no impact on current business or operations as none of the entities manufactures or sells products. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) LYONDELL CHEMICAL: Revises Plan as Creditors Settlement Reached --------------------------------------------------------------- Lyondell Chemical Company and its debtor affiliates filed with the United States Bankruptcy Court for the Southern District of New York a modified Third Amended Joint Plan of Reorganization on March 6, 2010. The Modified 3rd Amended Plan was filed as an exhibit to the Debtors' revised lender litigation settlement with the Official Committee of Unsecured Creditors, Wilmington Trust Company, Financing Party Defendants, and a 2015 Noteholders ad hoc group. The Financing Party Defendants is composed of Citibank, N.A.; Citibank International plc; and Citigroup Global Markets Inc.; Goldman Sachs Credit Partners, L.P., and Goldman Sachs International; Merrill, Lynch, Pierce, Fenner & Smith and Merrill Lynch Capital Corporation; ABN AMRO Inc. and The Royal Bank of Scotland, N.V., f/k/a ABN Amro Bank N.V.; UBS Securities LLC and UBS Loan Finance LLC; LeverageSource III S...r.l.; Ares Management LLC; Bank of Scotland, DZ Bank AG; Kolberg Kravis Roberts & Co. (Fixed Income) LLC and UBS AG. Wilmington Trust Company is the trustee for 8.375% senior notes due 2015 in the principal amounts of $615 million and EUR500 million issued pursuant to a 2015 Notes Indenture. The ad hoc group of 2015 Noteholders is composed of Arrowgrass Master Fund Ltd.; Arrowgrass Distressed Opportunities Fund Limited; Basso Credit Opportunities Holding Fund Ltd.; Basso Fund Ltd.; Basso Multi-Strategy Holding Fund Ltd.; Columbus Hill Partners, L.P.; Columbus Hill Overseas, Ltd.; CQS Directional Opportunities Master Fund Limited; Kivu Investment Fund Limited; Mariner LDC; Caspian Capital Partners, LP; Caspian Select Credit Master Fund, Ltd.; CVI GVF (Lux) Master S.a.r.l.; Fortelus Special Situations Master Fund Ltd., and Panton Master Fund, L.P. Under the Modified Third Amended Plan, modifications were made in a manner consistent with the terms agreed to in the Revised Lender Litigation Settlement, relates counsel for the Debtors, George A. Davis, Esq., at Cadwalader, Wickersham & Taft LLP, in New York. Mr. Davis notes that the Revised Settlement resolves all claims brought by the Creditors Committee in an action filed against the Financing Party Defendants as a result of a December 20, 2007 merger of Lyondell Chemical Company and Basell AF S.C.A. In light of the filing of the Modified Third Amended Plan, the Court has rescheduled the hearing to consider the adequacy of the Disclosure Statement from March 8, 2010, to a date yet to be determined. The rescheduled hearing date will be announced in a further notice, Mr. Davis says. Modifications to the Plan The Modified Third Amended Plan provides that on or before the effective date of the Plan, Reorganized LyondellBasell will enter into an Exit Facility and grant all liens and security interests provided under that Exit Facility. The applicable Reorganized Debtors that are guarantors under the Exit Facility will issue the guarantees, liens and security interests. The Exit Facility will be on terms and conditions set forth in a Plan Supplement to be filed with the Court. In full and complete satisfaction of their claims against "Obligor Non-Debtors" and Debtor Basell Germany Holdings GmbH, if any, and pursuant to distributions in connection with a Global Restructuring and pursuant to the Amended Plan, each holder of Senior Secured Claims will receive its pro rata share of 100% of the Class A Shares allocable to the net value of Debtor LyondellBasell Industries AF S.C.A. and non-Debtor LyondellBasell Industries Holdings B.V. and any of their direct and indirect subsidiaries, subject to dilution on account of the Equity Compensation Plan and the New Warrants. LyondellBasell Industries N.V., referred to as New Topco will distribute any Class A shares and Cash payable to holders of Allowed 2015 Notes Claims under the Amended Plan. All references to Senior Secured Claims has also been revised to Senior Secured Facility Claims. Millennium Custodial/Environmental Trusts According to the Modified Third Amended Plan, by virtue of Lyondell Chemical's transfer of its equity interests in Debtor Millennium Chemicals, Inc. to the Millennium Custodial Trust, MCI's subsidiaries will be under the direct or indirect control of the trustee to the Millennium Custodial Trust. Each holder of an Allowed Claim against any other "Schedule III Obligor Debtor" will receive, in full and complete satisfaction of its Allowed Claim, Participation Rights, but excluding any amounts for postpetition interest of post-Effective Date interest. A list of Schedule III Obligor Debtors is available for free at: http://bankrupt.com/misc/Lyondell_SchedIIIObligorDebtors.pdf The Millennium Trust Trustee will appoint the directors of MCI and in turn, these directors will appoint the officers of MCI. Moreover, the Millennium Trust Trustee may establish a reserve on account of claims that are disputed with respect to MCI. The Millennium Trust Trustee may, for U.S. federal income tax purposes, (i) make an election pursuant to Section 1.468b-9 of the Internal Revenue Code to treat the MCI Reserve as a "disputed ownership fund," (ii) allocate taxable income or loss to the MCI Reserve, with respect to any given taxable year, and (iii) distribute assets from the MCI Reserve as, when, and to the extent, those Disputed Claims are resolved. An Environmental Custodial Trust will also be formed pursuant to an Environmental Custodial Trust Agreement. In the event the trustee under the Environmental Trust dies, is disabled, removed or resigns for any reason, the U.S. Environmental Protection Agency will designate a successor. Litigation Trust Mr. Davis notes that a Litigation Trust Agreement will be executed, and the claims of defendants in the Committee Action who are not party to the Revised Settlement and any preference claim to be waived or settled as part of the Revised Settlement, referred as "Assigned Preference Claims" will be assigned to a Litigation Trust. The Litigation Trust is authorized to prosecute the Assigned Preference Claims for the benefit of (i) holders of Allowed General Unsecured Claims and 2015 Notes Claim, who will receive a Settlement Pro Rata Share of 90% of any net recoveries on Assigned Preference Claims, and (ii) the Reorganized Debtors, who will receive 10% of any net recoveries on Assigned Preference Claims. After the Excess Recovery Trigger Date, all Assigned Preference Claims against present or former employees of the Debtors will be extinguished. To assist the Litigation Trust with respect to its initial analysis of Assigned Preference Claims, the Debtors will provide to the Creditors Committee and the Settling Defendants a "preliminary preference report" by March 20, 2010, identifying potential preference payments and recipients. Creditor Trust In addition, a Creditor Trust Agreement will be executed, notes Mr. Davis. On the Plan Effective Date, Abandoned Claims -- claims brought on behalf of the Debtors estates against former shareholders of Lyondell in the Committee Action under Section 544 of the Bankruptcy Code -- will be discontinued by the Debtors and the Debtors will be deemed to have abandoned any and all right to further pursue the Abandoned Claims. The Creditor Trust will be authorized to prosecute any and all claims against former shareholders of Lyondell and their successors or State Law Avoidance Claims that are contributed to the Creditor Trust for the benefit of Creditor Trust Beneficiaries, who will receive any recoveries on account of the State Law Avoidance Claims, which will distributed to Creditor Trust Beneficiaries in accordance with the Amended Plan and the Creditor Trust Agreement. The Creditor Trust will be operated by a trustee who will report to a three-member advisory board. The Creditor Trustee and the members of the Creditor Trust Advisory Board will be distinct individuals and will be appointed by the Creditors Committee in its sole discretion. Each of the trustee under the Litigation Trust or the Creditor Trust may establish a reserve on account of Claims that are Disputed. The Creditor Trustee or Litigation Trustee may, for U.S. federal income tax purposes, (i) make an election pursuant to Internal Revenue Code Section 1.468B-9 to treat a reserve fund under the Creditor Trustee of Litigation Trust as a disputed ownership fund, (ii) allocate taxable income or loss to the CT or LT Reserve, with respect to any given taxable year, and (iii) distribute assets from the CT or LT Reserve as, when, and to the extent, those Claims cease to be disputed. The Creditor Trust will be dissolved no later than five years from the Plan Effective Date. Upon dissolution of the Creditor Trust, any remaining Cash on hand and other assets will be distributed to the Creditor Trust Beneficiaries in accordance with the Creditor Trust Agreement. On the Plan Effective Date, the Debtors will fund, as a grant, an aggregate of $20 million to the Liquidation and Creditor Trusts to pay for the costs and fees of prosecution of claims by the Liquidation and Creditor Trusts and the costs of administration of these Trusts. Dissolution of Creditors Committee On the Effective Date, the Creditors Committee will be dissolved and the members will be released and discharged of and from all further authority and duties arising from and in connection with the Debtors' Chapter 11 cases, and the retention of the Creditors Committee's professionals will terminate. Modified Claims Treatment The Modified Third Amended Plan also provides modifications to treatment of certain claims: (1) Holders of Class 4 Senior Secured Claims will receive (i) pro rata share of 100% of Class A Shares based on the net value allocable to Debtor LyondellBasell Finance Company, and its subsidiaries, less the number of the Class A Shares provided to holders of Allowed Claims on account of distributions in Classes 5 and 7-C; (ii) a right to purchase its Rights Offering Pro Rata Share of Class B Shares, and (iii) a right to participate in Excess Recoveries from the Creditor Trust and the Litigation Trust. (2) Holders of Class 5 Bridge Loan Claims will receive, in full and complete satisfaction for their claims, (i) a Pro Rata Share of the number of Class A Shares equivalent to 5.0% of the combined Class A and Class B Shares, less the number of Class A Shares at Plan value equal to $75 million, (ii) a Pro Rata Share of the New Warrants and (iii) a right to participate in the Excess Recoveries from the Litigation Trust and Creditor Trust. (3) Holders of Class 7-A General Unsecured Claims against Non- Schedule III Obligor Debtors will receive Settlement Pro Rata Share of the Revised Settlement consideration. The portion of the Settlement Consideration consisting of Class A Shares will be distributed in its entirety to holders of General Unsecured Claims and 2015 Notes Claims that have been allowed as of the Effective Date. Non-Schedule III Obligor Debtors are the Obligor Debtors except the Schedule III Obligor Debtors. (4) Holders of Class 7-B General Unsecured Claims that will recover more than 0% and less than 100% of their Claims are impaired and will be entitled to vote to accept or reject the Amended Plan. Moreover, holders of Allowed General Unsecured Claims that will recover 100% of their Claims will be deemed to accept the Plan. Holders of Allowed General Unsecured Claims that will recover 0% of their Claims will be deemed to reject the Plan. A schedule of estimated recovery percentages for each Non-Obligor Debtor is available for free at: http://bankrupt.com/misc/Lyondell_EstRecNonObligorDebtor.pdf Non-Obligor Debtors are Debtors that are not Obligor Debtors or Schedule III Debtors. (5) Holders of Class 7-C General Unsecured Claims and Senior/Bridge Guarantee Claims against Debtors Millennium Petrochemicals, Inc., Millennium Specialty Chemicals, Inc. and Millennium US Op Co. LLC are impaired and entitled to vote on the Amended Plan. Each holder of an Allowed Senior/Bridge Guarantee Claim against MSC, MPI and MPCO will receive (i) in the aggregate, Class A Shares valued at no less than about $195 million and (ii) Class A Shares valued at no more than $90 million. The maximum value distributable to holders of Allowed General Unsecured Claims and Senior/Bridge Guarantee Claims against MPCO, MPI and MSC will be $0, $214,935,341 and $70,578,926. A schedule of estimated recovery percentages for each of MPI, MSC and MPCO is available for free at: http://bankrupt.com/misc/Lyondell_EstRecMPIDebtors.pdf (6) Holders of Class 7-D General Unsecured Claims and Senior/Bridge Deficiency Claims against Schedule III Obligor Debtors are impaired. Each holder of an Allowed General Unsecured Claim and Senior/Bridge Deficiency Claim against MCI will receive, in full and complete satisfaction of its claim against MCI, (i) beneficial trust interests in the Millennium Custodial Trust, which will entitle that holder to its Pro Rata Share of recoveries with respect to the assets of the Millennium Custodial Trust, including any recovery by MCI as a result of its direct or indirect ownership interest in its direct and indirect subsidiaries and (ii) its Settlement Pro Rata Share of the Settlement Consideration. (7) For holders of Class 8 2015 Notes Claims Distributions, if certain 2015 Notes Plan Conditions are satisfied or waived pursuant to the Revised Settlement, the holders of Allowed 2015 Notes Claims will receive their Settlement Pro Rata Share of the Settlement Consideration. The 2015 Notes Plan Conditions are: (a) (1) Class 8 2015 Notes Claims has voted to accept the Amended Plan, (2) neither Wilmington Trust nor any member of the 2015 Notes Ad Hoc Group has objected to or appealed the approval of the Revised Settlement, and (3) neither Wilmington Trust nor any member of the 2015 Notes Ad Hoc Group has objected to confirmation of the Plan, or appealed the Confirmation Order; (b) (1) Wilmington Trust has taken no further action, directly or indirectly, to prosecute the adversary proceeding against LBI and (2) neither Wilmington Trust nor any member of the 2015 Notes Ad Hoc Group has objected to any motions filed by the Debtors in the Debtors' injunction litigation against Wilmington Trust or taken any further action either in the Debtors' Injunction Litigation or in the Debtors' bankruptcy cases with regard to the Injunction Litigation; and (c) neither Wilmington Trust nor any member of the 2015 Notes Ad Hoc Group has breached the Revised Settlement. Compensation and Benefit Programs Except with respect to any Benefit Plan that has been terminated or rejected as of the Effective Date, all Benefit Plans and collective bargaining agreements will remain in full force and effect as of the Plan Effective Date. The Modified Amended Plan neither terminates nor impairs the Pension Plans, and for greater certainty, the U.S. Pension Plans and the U.K. Pension Plan will ride through the Debtors' Chapter 11 cases. Upon confirmation of the Amended Plan, the applicable Reorganized Debtors will assume and continue the U.S. Pension Plans in accordance with their terms and the provisions of Employee Retirement Income Security Act and the Internal Revenue Code and satisfy the minimum funding standards pursuant to Sections 412 and 430 of the ERISA and Section 1082 of the Labor Code. Conditions Precedent to Effectiveness of Plan The Plan will not become effective unless and until these conditions are satisfied or waived: (a) The Bankruptcy Court will have entered a Confirmation Order, in form and substance reasonably satisfactory to: (1) an ad hoc group of certain lenders under the Senior Secured Credit Agreement; (2) arrangers holding at least 50.1% in principal amount of the outstanding loans held by all Arrangers under the Bridge Loan Agreement; (3) ABN AMRO Incorporated; Citigroup Global Markets Inc.; Goldman Sachs Credit Partners L.P.; Merrill Lynch, Pierce, Fenner & Smith Incorporated and UBS Securities LLC, and their affiliates, as joint lead arrangers and bookrunners in all other capacities under the Senior Secured Credit Agreement and the Bridge Loan Agreement; (4) LeverageSource (Delaware) LLC, an affiliate of Apollo Management VII, L.P.; AI LBI Investment LLC, an affiliate of Access Industries; and Ares Corporate Opportunities Fund III, L.P., as rights offering sponsors, which will approve the Plan; (5) solely as it relates to matters relating to the Revised Settlement, the Creditors Committee; and (6) provided that the 2015 Notes Plan Conditions have been satisfied, Wilmington Trust. However, the satisfaction of the parties will not be required to the extent that any modification to the proposed form of Confirmation Order with regard to specific terms under the Amended Plan is determined by the Bankruptcy Court to be required by applicable law; (b) The Plan approved by the Bankruptcy Court pursuant to the Confirmation Order will be in form and substance reasonably satisfactory to each of: (1) the Debtors, (2) the Ad Hoc Group, (3) the Rights Offering Sponsors, (4) the Majority Arrangers, (5) the Arrangers; (6) solely as it relates to matters relating to the Revised Settlement, the Creditors Committee; and (7) provided that the 2015 Notes Plan Conditions have been Satisfied. However, the satisfaction of the parties will not be required to the extent that any modification to the proposed form of Confirmation Order with regard to specific terms under the Amended Plan is determined by the Bankruptcy Court to be required by applicable law. (c) No stay of the Confirmation Order will be in effect at the time the other conditions set forth under the Amended Plan are satisfied or waived. (d) All documents, instruments and agreements provided for under, or necessary to implement, the Amended Plan will have been executed and delivered by the parties, in form and substance satisfactory to each of the Debtors, unless execution or delivery has been waived by the parties benefited and all those documents, Instruments and agreements will be effective on the Effective Date. (e) All of the payments to be made by the Debtors by or on the Effective Date will have been made or will be made on the Effective Date. (f) The Debtors or the Reorganized Debtors, as applicable, will have entered into an Exit Facility that satisfies the conditions set forth in an Equity Commitment Agreement between the Rights Offering Sponsors and the Debtors, and all conditions precedent to funding under the Exit Facility will have been satisfied or waived. (g) The Debtors will have raised $2.8 billion in cash pursuant to the Rights Offering and the direct purchase of 23,562,677 Backstop Consideration Shares by the Rights Offering Sponsors. (h) The Debtors or the Reorganized Debtors, as applicable, will have obtained all governmental and other regulatory approvals or rulings that may be necessary for consummation of the Amended Plan or that are required by law, regulation or order. (i) The Debtors will have sold the appropriate amount of Class B Shares to the Rights Offering Sponsors in accordance with the Equity Commitment Agreement, and will have paid the Rights Offering Sponsors' fees and expenses incurred under the Equity Commitment Agreement, in full in Cash, without the need for any of the members of the Ad Hoc Group or the Rights Offering Sponsors to file retention applications with the Bankruptcy Court unless otherwise required by order of the Bankruptcy Court; and (j) The Revised Settlement will have been approved by a Final Order of the Bankruptcy Court in form and substance reasonably satisfactory to the Debtors, the Creditors Committee, the Ad Hoc Group, the Arrangers, and Wilmington Trust, solely as it relates to any provision of the Revised Settlement that has a direct effect on Wilmington Trust and the 2015 Notes Ad Hoc Group. Mr. Davis says that in the event that one or more of the conditions precedent set can not be satisfied and the occurrence of this condition is not waived on or before the date that is 180 days after the Confirmation Date, the Debtors will file a notice of the failure of the Effective Date with the Bankruptcy Court and: (i) the Confirmation Order will be vacated by the Bankruptcy Court, (ii) the Amended Plan will be null and void in all respects, and no distributions under the Amended Plan will be made, (iii) the Debtors and all holders of Claims and Equity Interests will be restored to the status quo ante as of the day immediately preceding the Confirmation Date as though the Confirmation Date never occurred, and (iv) the Debtors' obligations with respect to Administrative Expenses, Claims and Equity Interests will remain unchanged. Nothing contained in the Amended Plan will constitute or be deemed a waiver or release of any Claims or Equity Interests by or against the Debtors or any other Person or will prejudice in any manner the rights of the Debtors or any Person in any further proceedings involving the Debtors. A full-text copy of the Third Amended Plan is available for free at: http://bankrupt.com/misc/Lyondell_3rdAmPlan.pdf A blacklined version of the Third Amended Plan is available for free at: http://bankrupt.com/misc/Lyondell_3rdAmPlan_blacklined.pdf About Lyondell Chemical LyondellBasell Industries is one of the world's largest polymers, petrochemicals and fuels companies. It is the global leader in polyolefins technology, production and marketing; a pioneer in propylene oxide and derivatives; and a significant producer of fuels and refined products, including biofuels. Through research and development, LyondellBasell develops innovative materials and technologies that deliver exceptional customer value and products that improve quality of life for people around the world. Headquartered in The Netherlands, LyondellBasell -- http://www.lyondellbasell.com/-- is privately owned by Access Industries. Basell AF and Lyondell Chemical Company merged operations in 2007 to form LyondellBasell Industries, the world's third largest independent chemical company. LyondellBasell became saddled with debt as part of the US$12.7 billion merger. On January 6, 2009, LyondellBasell Industries' U.S. operations and one of its European holding companies -- Basell Germany Holdings GmbH -- filed voluntary petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code to facilitate a restructuring of the company's debts. The case is In re Lyondell Chemical Company, et al., Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondell entities, including Equistar Chemicals, LP, Lyondell Chemical Company, Millennium Chemicals Inc., and Wyatt Industries, Inc. filed for Chapter 11. In May 2009, one of the cases was dismissed -- Case No. 09-10068 -- because it is duplicative of Case No. 09- 10040 relating to Debtor Glidden Latin America Holdings. The Hon. Robert E. Gerber presides over the case. Deryck A. Palmer, Esq., at Cadwalader, Wickersham & Taft LLP, in New York, serves as the Debtors' bankruptcy counsel. Evercore Partners serves as financial advisors, and Alix Partners and its subsidiary AP Services LLC, serves as restructuring advisors. AlixPartners' Kevin M. McShea acts as the Debtors' Chief Restructuring Officer. Clifford Chance LLP serves as restructuring advisors to the European entities. Lyondell Chemical estimated that consolidated assets total US$27.12 billion and debts total US$19.34 billion as of the bankruptcy filing date. Lyondell has obtained approximately US$8 billion in DIP financing to fund continuing operations. The DIP financing includes two credit agreements: a US$6.5 billion term loan, which comprises a US$3.25 billion in new loans and a US$3.25 billion roll-up of existing loans; and a US$1.57 billion asset-backed lending facility. Luxembourg-based LyondellBasell Industries AF S.C.A. and another affiliate were voluntarily added to Lyondell Chemical's reorganization filing under Chapter 11 on April 24, 2009, in order to seek protection against claims by certain financial and U.S. trade creditors. On May 8, 2009, LyondellBasell Industries added 13 non-operating entities to Lyondell Chemical Company's reorganization filing under Chapter 11 of the U.S. Bankruptcy Code. All of the entities are U.S. companies and were added to the original Chapter 11 filing for administrative purposes. The filings will have no impact on current business or operations as none of the entities manufactures or sells products. Bankruptcy Creditors' Service, Inc., publishes Lyondell Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lyondell Chemical Company and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) MAJESTIC STAR: Committee Seeks OK to Pursue Claims vs. Lenders -------------------------------------------------------------- BankruptcyData reports that the Official Committee of Unsecured Creditors in Majestic Star Casino's cases filed with the U.S. Bankruptcy Court for the District of Delaware a motion, pursuant to 11 U.S.C. 105(a), 1103(c) and 1109(b), seeking leave, standing and authority to prosecute and, if appropriate, settle claims on behalf of the Debtors' estates. The Committee requests authority to bring the claims because, at the onset of these cases, by virtue of the stipulations contained in the cash collateral order, the Debtors released and waived any ability to assert claims against the secured parties related to, among other things, the validity and enforceability of the secured parties' liens in the Debtors' assets. The Committee says that because the Debtors cannot pursue these actions, these valuable claims will not be prosecuted if its request is denied. About Majestic Star The Majestic Star Casino, LLC -- aka Majestic Star Casino, aka Majestic Star -- is based in Las Vegas, Nevada. It is a wholly owned subsidiary of Majestic Holdco, LLC, which is a wholly owned subsidiary of Barden Development, Inc. The Company was formed on December 8, 1993, as an Indiana limited liability company to provide gaming and related entertainment to the public. The Company commenced gaming operations in the City of Gary at Buffington Harbor, located in Lake County, Indiana on June 7, 1996. The Company is a multi-jurisdictional gaming company with operations in three states -- Indiana, Mississippi and Colorado. The Company filed for Chapter 11 bankruptcy protection on November 23, 2009 (Bankr. D. Delaware Case No. 09-14136). The Company's affiliates -- The Majestic Star Casino II, Inc., The Majestic Star Casino Capital Corp., Majestic Star Casino Capital Corp. II, Barden Mississippi Gaming, LLC, Barden Colorado Gaming, LLC, Majestic Holdco, LLC, and Majestic Star Holdco, Inc. -- also filed separate Chapter 11 petitions. Kirkland & Ellis LLP is the Debtors' bankruptcy counsel. James E. O'Neill, Esq., Laura Davis Jones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl & Jones LLP are the Debtors' Delaware counsel. Xroads Solutions Group, LLC, is the Debtors' financial advisor, while EPIQ Bankruptcy Solutions LLC are the Debtors' claims and notice agent. The Majestic Star Casino, LLC's balance sheet at June 30, 2009, showed total assets of $406.42 million and total liabilities of $749.55 million. When it filed for bankruptcy, the Company listed up to $500 million in assets and up to $1 billion in debts. MAMMOTH CORONA: Court OKs Stipulation Withdrawing Plan Outline -------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois approved the stipulation deeming Mammoth Corona 1 LLC's Disclosure Statement filed on January 12, 2010, withdrawn. The Debtor and its secured creditor, U.S. Bank National Association entered into a stipulation that provided for: -- the hearing on the Debtor's Disclosure Statement scheduled for February 24, is off the calendar; and -- the scheduling and case management conference scheduled for February 24, 2010, is continued to March 15, 2010, at 9:00 a.m. Based in San Juan Capistrano, California, Mammoth Corona 1 LLC filed for Chapter 11 on Oct. 16, 2009 (Bankr. C.D. Calif. Case No. 09-21220). Thomas C. Corcovelos, Esq., represents the Debtor. In its petition, the Debtor listed both assets and debts between $10 million and $50 million. MAMMOTH CORONA: Wants Access to U.S. Bank's Cash Collateral ----------------------------------------------------------- Mammoth Corona 1 LLC asks the U.S. Bankruptcy Court for the Northern District of Illinois for authorization to use the rents generated by its primary asset, a real property located at 4740 Green River Road, Corona, California. The real property rents are subject only to the security interest of the secured lender U.S. Bank, N.A. The Debtor needs money to fund its business operations. U.S. Bank has not consented to the Debtor's cash collateral use. The Debtor says that adequate protection exists when they use the cash collateral for the ordinary and necessary operating expenses as it maintains the value of the underlying collateral. Based in San Juan Capistrano, California, Mammoth Corona 1 LLC filed for Chapter 11 on Oct. 16, 2009 (Bankr. C.D. Calif. Case No. 09-21220). Thomas C. Corcovelos, Esq., represents the Debtor. In its petition, the Debtor listed both assets and debts between $10 million and $50 million. MARINE GROWTH: Earns $1.3 Million in Q3 2009 -------------------------------------------- Marine Growth Ventures, Inc., filed its quarterly report on Form 10-Q, showing net income of $1,260,053 for the three months ended September 30, 2009, compared with a net loss of $1,331,106 for the same period of 2008. Net income/(loss) was $753,485 and ($1,981,163) for the nine months ended September 30, 2009, and 2008, respectively. "The increase in net income of $2,734,648 is attributed to the settlement agreement with Greystone which released the vessel 'the Babe' to Greystone." Revenue was $0 for the nine months ended September 30, 2009, compared to $12,000 earned in the nine months ended September 30, 2008. In the nine months ended September 30, 2009, the Company had no revenue. The reduction in revenue was due to the discontinuation of the bareboat charter. The Company's balance sheet as of September 30, 2009, showed $1,510,168 in assets and $5,096,226 of debts, for a stockholders' deficit of $3,586,058. The Company currently does not have sufficient cash reserves to meet all of its anticipated obligations for the next twelve months and there can be no assurance that the Company will ultimately close on the necessary financing. "As we note in our consolidated balance sheets as of September 30, 2009, and December 31, 2008, as well as our related consolidated statements of operations, and cash flows for the year ended September 30, 2009, we have experienced, and expects to continue to experience, recurring net losses, negative cash flows from operations, limited amount of funds on our balance sheet. Accordingly, we have substantial doubt about our ability to continue as a going concern." A full-text copy of the quarterly report is available for free at http://researcharchives.com/t/s?579e Cape Canaveral, Fla.-based Marine Growth Ventures, Inc. is a holding company and conducts its current operations primarily through a wholly-owned subsidiary, Sophlex Ship Management, Inc. Sophlex, which was founded in 1999, provides ship crewing and management services to vessel owners and operators in the United States and abroad. METRO-GOLDWYN-MAYER: To Pursue Debt-to-Equity Swap if Sale Fails ---------------------------------------------------------------- The Wall Street Journal's Mike Spector and Lauren A. E. Schuker report that people familiar with the matter said Metro-Goldwyn- Mayer Inc. is readying a backup plan should bids for its assets come in too low. Binding offers for the studio are due March 19. Sources told the Journal, MGM creditors are increasingly willing to assume control over the studio. The sources said that under that scenario, MGM would likely pursue a "standalone" plan in which lenders would convert their debt to equity. People familiar with the backup plan told the Journal if creditors opt for the standalone debt-to-equity conversion plan, MGM would then sell stock to another investor. That investor, according to the Journal's sources, could come from among MGM's creditors, many of them hedge funds that have bought into the studio's bank debt and are more receptive to taking equity. According to the Journal, MGM is working to get a deal done quickly ahead of payment dates on its debt. People familiar with the situation said that a final decision on MGM's fate is likely by April. A leniency agreement on MGM's debt expires March 31, and the studio faces a $250 million revolving credit facility maturing about a week later, the Journal relates. The Journal notes that MGM's lending group, led by J.P. Morgan Chase & Co., at one point included more than 100 investors. The Journal says any change in control outside of bankruptcy would require unanimous approval. MGM creditors are owed nearly $4 billion, and have for months tried to drum up interest in the studio. MGM originally sought offers in the range of $2 billion or more. According to the Journal, people familiar with the situation said bidders are signaling they're willing to pay only around $1.5 billion, and possibly less, citing the sagging cash flow from the studio's film library. According to the Journal, some of the sources believe bids could even fall as low as $1 billion. The Journal also reports MGM's bank debt trades around 60 cents, valuing the studio at roughly $2.4 billion. The Journal says the amount is at odds with some suitors' assessments. MGM's creditors have "gotten a little bit more brazen about hanging onto this thing if the M&A process doesn't provide the results that they like," said a person familiar with the situation, the Journal relates. The Journal's sources said Warner Brothers studio parent Time Warner Inc. and Russian-born industrialist Len Blavatnik, who owns Access Industries, are among MGM's leading suitors. Liberty Media Corp.; Lions Gate Entertainment Corp.; and New York hedge-fund Elliott Management, a big investor in Ryan Kavanaugh's Relativity Media, have also looked at MGM's books. Other sources told the Journal News Corp. had offered to invest in MGM in exchange for an equity stake, but hasn't heard back from the studio. Those sources said News doesn't plan to buy MGM. The report also says Summit Entertainment has looked at MGM's books but it remained unclear whether they would bid. Qualia Capital, a media investment firm, has expressed interest in investing in MGM if the studio pursues a standalone restructuring, the report adds. About Metro-Goldwyn-Mayer Metro-Goldwyn-Mayer, Inc., is an independent, privately held motion picture, television, home video, and theatrical production and Distribution Company. The Company owns the world's largest library of modern films, comprising approximately 4,000 titles, and over 10,400 episodes of television programming. An investor consortium, comprised of Providence Equity Partners, TPG Capital, Sony Corporation of America, Comcast Corporation, DLJ Merchant Banking Partners and Quadrangle Group, owns MGM. As reported by the Troubled Company Reporter on Sept. 30, 2009, The New York Post, citing multiple sources, said discussions between debt holders and equity owners on a restructuring of Metro-Goldwyn-Mayer's massive debt load have begun on a contentious note, with both sides threatening to force MGM into bankruptcy in order to gain leverage and extract better terms from the other. Bloomberg also said that MGM is in talks to skip interest payments and restructure $3.7 billion in bank loans. MGM asked creditors to waive $12 million monthly interest payments until Feb. 15, 2010. METROPOLITAN LOFTS: Case Converted to Chapter 7 Liquidation ----------------------------------------------------------- The Hon. Eileen W. Hollowell of the U.S. Bankruptcy Court for the District of Arizona approved the conversion of the reorganization case of Metropolitan Lofts, L.L.C., to Chapter 7 liquidation. As reported in the Troubled Company Reporter on February 23, 2010, the Debtor sought the conversion on grounds due to a substantial or continuing loss or diminution of the estate and the absence of a reasonable likelihood of rehabilitation. Phoenix, Arizona-based Metropolitan Lofts, L.L.C., filed for Chapter 11 bankruptcy protection on December 10, 2009 (Bankr. D. Ariz. Case No. 09-31907). Jerry L. Cochran, Esq., at Cochran Law Firm, PC, assists the Company in its restructuring effort. The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. MGM MIRAGE: Appoints William Bible as New Director -------------------------------------------------- The Board of Directors of MGM MIRAGE on March 8, 2010, appointed William A. Bible as a new director of the Company, subject to gaming and other regulatory approvals, to serve as a member of the Company's Board of Directors until the Company's next annual meeting or until his successor is elected and qualified. Subject to Mr. Bible obtaining gaming and other regulatory approvals, the Company expects that he will be named to the Audit Committee. "We are honored to welcome Bill Bible as the newest member of our Board of Directors," said James J. Murren, MGM MIRAGE Chairman and Chief Executive Officer. "Bill's wealth of expertise and familiarity with a wide range of financial and regulatory matters in both hospitality and gaming will serve as a tremendous asset to our Company." Mr. Bible currently serves as the President of the Nevada Resort Association, the advocacy voice for Nevada's gaming and resort industry. Mr. Bible will tender his resignation to the Nevada Resort Association to be effective before the required gaming regulatory approvals or waivers are granted to avoid any conflicts inherent with concurrent service. From 1988 to 1998, he served as the Chairman of the Nevada State Gaming Control Board. His broad tenure as a state official includes his experience as Director of Nevada's Administration Department under Gov. Richard Bryan (1983-1988); Nevada Assembly Fiscal Analyst and Director of the Division of Fiscal Analysis of the Legislative Counsel Bureau (1977-1983); and Nevada Deputy Budget Administrator (1973-1977) and Nevada Chief Assistant Budget Administrator (1971-1973) under Gov. Mike O'Callaghan. Mr. Bible graduated from Stanford University in 1967 with a Bachelor of Arts Degree in History with a minor in Political Science, followed by a Masters Degree in Business Administration in 1971 from the University of Nevada, Reno. His Masters program emphasized capital budgeting, resource allocation, portfolio management and general financial management. There is no arrangement or understanding between Mr. Bible and any other persons pursuant to which he was selected as a director of the Company. Furthermore, the Company has not been since the beginning of the last fiscal year, and is not currently proposed to be, a participant in any related party transaction with Mr. Bible within the meaning of Item 404(a) of Regulation S-K. Upon receipt of the requisite gaming and other regulatory approvals, Mr. Bible, as a member of the Board of Directors of the Company, will be entitled to receive fees paid and stock appreciation rights granted by the Company to its directors who are not full-time employees of the Company. About MGM MIRAGE Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) -- http://www.mgmmirage.com/-- owns and operates 16 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, New Jersey, Illinois and Macau. CityCenter, an urban metropolis on the Las Vegas Strip scheduled to open in late 2009, is a joint venture between MGM MIRAGE and Infinity World Development Corp, a subsidiary of Dubai World. MGM MIRAGE Hospitality has entered into management agreements for future casino and non-casino resorts throughout the world. At September 30, 2009, MGM MIRAGE had $21.7 billion in total assets against total current liabilities of $1.15 billion, deferred income taxes of $3.14 billion, long-term debt of $12.9 billion, other long-term obligations of $221.70 million; resulting in stockholders' equity of $4.29 billion. * * * As reported by the Troubled Company Reporter on September 22, 2009, Moody's Investors Service affirmed MGM MIRAGE's Caa2 Corporate Family Rating and Caa3 Probability of Default Rating. Moody's also assigned a Caa2 rating to the company's new $475 million 11.375% senior unsecured notes due 2018. Moody's also affirmed MGM's SGL-4 Speculative Grade Liquidity rating. The rating outlook is negative. As reported by the TCR on September 24, 2009, Fitch Ratings has assigned a 'CCC/RR4' rating to MGM MIRAGE's $475 million 11.375% unsecured notes due 2018. The notes were priced at a 97.396% discount to yield 11.875%. The net proceeds will be used to reduce credit facility borrowings, and also for general corporate purposes. The offering attempts to chip away at the company's most significant credit hurdle: the maturity of its $5.8 billion credit facility in 2011, which had $4.1 billion outstanding as of June 30, 2009. MGM MIRAGE: To Sell $845 Mil. Senior Secured Notes Due 2020 ----------------------------------------------------------- MGM MIRAGE proposes to offer up to $845 million in aggregate principal amount of senior secured notes due 2020 in a private placement. The Company plans to use the net proceeds from the offering to repay a portion of the outstanding indebtedness under its senior credit facility and related fees and expenses. The notes will be secured by a mortgage on MGM Grand Las Vegas and substantially all existing and future property of MGM Grand Hotel, LLC, and, upon receipt of the necessary gaming approvals, a pledge of the limited liability company interests in MGM Grand Hotel, LLC. The notes will be general senior obligations of the Company, guaranteed by substantially all of the Company's domestic subsidiaries, which also guarantee the Company's other senior indebtedness, and equal in right of payment with, or senior to, all existing or future indebtedness of the Company and each guarantor. The notes proposed to be offered will not be registered under the Securities Act of 1933, as amended, or any state securities law and may not be offered or sold in the United States or to any U.S. persons absent registration under the Securities Act, or pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. The notes will be offered only to "qualified institutional buyers" under Rule 144A of the Securities Act or, outside the United States, to persons other than "U.S. persons" in compliance with Regulation S under the Securities Act. About MGM MIRAGE Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) -- http://www.mgmmirage.com/-- owns and operates 16 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, New Jersey, Illinois and Macau. CityCenter, an urban metropolis on the Las Vegas Strip scheduled to open in late 2009, is a joint venture between MGM MIRAGE and Infinity World Development Corp, a subsidiary of Dubai World. MGM MIRAGE Hospitality has entered into management agreements for future casino and non-casino resorts throughout the world. At September 30, 2009, MGM MIRAGE had $21.7 billion in total assets against total current liabilities of $1.15 billion, deferred income taxes of $3.14 billion, long-term debt of $12.9 billion, other long-term obligations of $221.70 million; resulting in stockholders' equity of $4.29 billion. * * * As reported by the Troubled Company Reporter on September 22, 2009, Moody's Investors Service affirmed MGM MIRAGE's Caa2 Corporate Family Rating and Caa3 Probability of Default Rating. Moody's also assigned a Caa2 rating to the company's new $475 million 11.375% senior unsecured notes due 2018. Moody's also affirmed MGM's SGL-4 Speculative Grade Liquidity rating. The rating outlook is negative. As reported by the TCR on September 24, 2009, Fitch Ratings has assigned a 'CCC/RR4' rating to MGM MIRAGE's $475 million 11.375% unsecured notes due 2018. The notes were priced at a 97.396% discount to yield 11.875%. The net proceeds will be used to reduce credit facility borrowings, and also for general corporate purposes. The offering attempts to chip away at the company's most significant credit hurdle: the maturity of its $5.8 billion credit facility in 2011, which had $4.1 billion outstanding as of June 30, 2009. MGM MIRAGE: Appoints William Bible as New Director -------------------------------------------------- The Board of Directors of MGM MIRAGE on March 8, 2010, appointed William A. Bible as a new director of the Company, subject to gaming and other regulatory approvals, to serve as a member of the Company's Board of Directors until the Company's next annual meeting or until his successor is elected and qualified. Subject to Mr. Bible obtaining gaming and other regulatory approvals, the Company expects that he will be named to the Audit Committee. "We are honored to welcome Bill Bible as the newest member of our Board of Directors," said James J. Murren, MGM MIRAGE Chairman and Chief Executive Officer. "Bill's wealth of expertise and familiarity with a wide range of financial and regulatory matters in both hospitality and gaming will serve as a tremendous asset to our Company." Mr. Bible currently serves as the President of the Nevada Resort Association, the advocacy voice for Nevada's gaming and resort industry. Mr. Bible will tender his resignation to the Nevada Resort Association to be effective before the required gaming regulatory approvals or waivers are granted to avoid any conflicts inherent with concurrent service. From 1988 to 1998, he served as the Chairman of the Nevada State Gaming Control Board. His broad tenure as a state official includes his experience as Director of Nevada's Administration Department under Gov. Richard Bryan (1983-1988); Nevada Assembly Fiscal Analyst and Director of the Division of Fiscal Analysis of the Legislative Counsel Bureau (1977-1983); and Nevada Deputy Budget Administrator (1973-1977) and Nevada Chief Assistant Budget Administrator (1971-1973) under Gov. Mike O'Callaghan. Mr. Bible graduated from Stanford University in 1967 with a Bachelor of Arts Degree in History with a minor in Political Science, followed by a Masters Degree in Business Administration in 1971 from the University of Nevada, Reno. His Masters program emphasized capital budgeting, resource allocation, portfolio management and general financial management. There is no arrangement or understanding between Mr. Bible and any other persons pursuant to which he was selected as a director of the Company. Furthermore, the Company has not been since the beginning of the last fiscal year, and is not currently proposed to be, a participant in any related party transaction with Mr. Bible within the meaning of Item 404(a) of Regulation S-K. Upon receipt of the requisite gaming and other regulatory approvals, Mr. Bible, as a member of the Board of Directors of the Company, will be entitled to receive fees paid and stock appreciation rights granted by the Company to its directors who are not full-time employees of the Company. About MGM MIRAGE Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) -- http://www.mgmmirage.com/-- owns and operates 16 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, New Jersey, Illinois and Macau. CityCenter, an urban metropolis on the Las Vegas Strip scheduled to open in late 2009, is a joint venture between MGM MIRAGE and Infinity World Development Corp, a subsidiary of Dubai World. MGM MIRAGE Hospitality has entered into management agreements for future casino and non-casino resorts throughout the world. At September 30, 2009, MGM MIRAGE had $21.7 billion in total assets against total current liabilities of $1.15 billion, deferred income taxes of $3.14 billion, long-term debt of $12.9 billion, other long-term obligations of $221.70 million; resulting in stockholders' equity of $4.29 billion. * * * As reported by the Troubled Company Reporter on September 22, 2009, Moody's Investors Service affirmed MGM MIRAGE's Caa2 Corporate Family Rating and Caa3 Probability of Default Rating. Moody's also assigned a Caa2 rating to the company's new $475 million 11.375% senior unsecured notes due 2018. Moody's also affirmed MGM's SGL-4 Speculative Grade Liquidity rating. The rating outlook is negative. As reported by the TCR on September 24, 2009, Fitch Ratings has assigned a 'CCC/RR4' rating to MGM MIRAGE's $475 million 11.375% unsecured notes due 2018. The notes were priced at a 97.396% discount to yield 11.875%. The net proceeds will be used to reduce credit facility borrowings, and also for general corporate purposes. The offering attempts to chip away at the company's most significant credit hurdle: the maturity of its $5.8 billion credit facility in 2011, which had $4.1 billion outstanding as of June 30, 2009. MGM MIRAGE: To Sell $845 Mil. Senior Secured Notes Due 2020 ----------------------------------------------------------- MGM MIRAGE proposes to offer up to $845 million in aggregate principal amount of its 9% senior secured notes due 2020 at par. The transaction is expected to close on March 16, 2010. The Company plans to use the net proceeds from the offering to repay a portion of the outstanding indebtedness under its senior credit facility and related fees and expenses. The notes will be secured by a mortgage on MGM Grand Las Vegas and substantially all existing and future property of MGM Grand Hotel, LLC, and, upon receipt of the necessary gaming approvals, a pledge of the limited liability company interests in MGM Grand Hotel, LLC. The notes will be general senior obligations of the Company, guaranteed by substantially all of the Company's domestic subsidiaries, which also guarantee the Company's other senior indebtedness, and equal in right of payment with, or senior to, all existing or future indebtedness of the Company and each guarantor. The notes proposed to be offered will not be registered under the Securities Act of 1933, as amended, or any state securities law and may not be offered or sold in the United States or to any U.S. persons absent registration under the Securities Act, or pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. The notes will be offered only to "qualified institutional buyers" under Rule 144A of the Securities Act or, outside the United States, to persons other than "U.S. persons" in compliance with Regulation S under the Securities Act. About MGM MIRAGE Headquartered in Las Vegas, Nevada, MGM MIRAGE (NYSE: MGM) -- http://www.mgmmirage.com/-- owns and operates 16 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, New Jersey, Illinois and Macau. CityCenter, an urban metropolis on the Las Vegas Strip scheduled to open in late 2009, is a joint venture between MGM MIRAGE and Infinity World Development Corp, a subsidiary of Dubai World. MGM MIRAGE Hospitality has entered into management agreements for future casino and non-casino resorts throughout the world. At September 30, 2009, MGM MIRAGE had $21.7 billion in total assets against total current liabilities of $1.15 billion, deferred income taxes of $3.14 billion, long-term debt of $12.9 billion, other long-term obligations of $221.70 million; resulting in stockholders' equity of $4.29 billion. * * * As reported by the Troubled Company Reporter on September 22, 2009, Moody's Investors Service affirmed MGM MIRAGE's Caa2 Corporate Family Rating and Caa3 Probability of Default Rating. Moody's also assigned a Caa2 rating to the company's new $475 million 11.375% senior unsecured notes due 2018. Moody's also affirmed MGM's SGL-4 Speculative Grade Liquidity rating. The rating outlook is negative. As reported by the TCR on September 24, 2009, Fitch Ratings has assigned a 'CCC/RR4' rating to MGM MIRAGE's $475 million 11.375% unsecured notes due 2018. The notes were priced at a 97.396% discount to yield 11.875%. The net proceeds will be used to reduce credit facility borrowings, and also for general corporate purposes. The offering attempts to chip away at the company's most significant credit hurdle: the maturity of its $5.8 billion credit facility in 2011, which had $4.1 billion outstanding as of June 30, 2009. MICHAEL WILLIAM CURTIS: Voluntary Chapter 11 Case Summary --------------------------------------------------------- Joint Debtors: Michael William Curtis Toni Dru Curtis 1535 Northridge Drive Prescott, AZ 86301 Bankruptcy Case No.: 10-06082 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court District of Arizona (Phoenix) Judge: Redfield T. Baum PCT Sr. Debtors' Counsel: Thomas Allen, Esq. Allen, Sala & Bayne, PLC Viad Corporate Center 1850 N. Central Ave., #1150 Phoenix, AZ 85004 Tel: (602) 256-6000 Fax: (602) 252-4712 Email: tallen@asbazlaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Debtors did not file a list of their 20 largest unsecured creditors when they filed their petition. The petition was signed by the Joint Debtors. MOVIE GALLERY: Gets Nod for Sonnenschein as Counsel --------------------------------------------------- Movie Gallery Inc. and its units obtained the Court's authority to employ Sonnenschein Nath & Rosenthal LLP, as counsel, nunc pro tunc to the Petition Date. The Debtors seek to employ Sonnenschein because of its expertise and extensive experience and knowledge in the field of business reorganizations under Chapter 11 of the Bankruptcy Code and the firm's particular knowledge of the Debtors and their 2007 Bankruptcy Case proceedings. The Debtors believe that Sonnenschein possesses the necessary familiarity with their businesses, as well as the necessary bankruptcy experience and expertise to handle the complex and novel issues that may arise within the reorganization proceedings. As their counsel, the Debtors expect Sonnenschein to perform these services: (a) provide legal advise with respect to the Debtors' powers and duties as Debtors-in-Possession in the continued operation of their businesses and management or disposition of their property; (b) all necessary action to protect and preserve the Debtors' estates, including the prosecution of actions on behalf of the Debtors, defense of any actions commenced against the Debtors, negotiations concerning any and all litigation in which the Debtors are involved and claims filed against the Debtors' estates; (c) attend meetings and negotiating with representative of the creditors and other parties-in-interest; (d) all necessary motions, answers, orders, reports and other legal papers in connection with the administration of the Debtors' estates; (e) represent the Debtors in connection with obtaining postpetition financing; (f) advise the Debtors in connection with any potential sale of the assets; (g) perform any and all other necessary legal services for the Debtors in connection with the Debtors' Chapter 11 cases; (h) all aspects of the confirmation process, including securing the approval of a disclosure statement and confirmation of a plan of reorganization at the earliest possible date; and (i) other related or necessary legal advice as may be appropriate in connection with the prosecution of the Debtors' Chapter 11 cases. The Debtors propose to pay Sonnenschein on its hourly rates plus the reimbursement of its reasonable necessary out of pocket expenses in representing the Debtors. Sonnenschein received $200,000 retainer in connection with its preparation for the filing of the Debtors' Bankruptcy Proceedings. The amount of the retainer has been reduced by the application of Sonnenschein's final prepetition charges. Sonnenschein's hourly rates are: Professional Hourly Rate ------------ ----------- Partners $295 to $890 Associates $190 to $525 Paraprofessionals $125 to $260 John A. Bicks, Esq., a partner of Sonnenschein, assures the Court that it does not hold or represent any interest adverse to the Debtors' estates in matters upon the firm is to be engaged. Furthermore, Sonnenschein is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code, as modified by Section 1107(b) of the Bankruptcy Code, Mr. Bicks maintains. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc. is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Movie Gallery Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Movie Gallery Inc. and affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) MOVIE GALLERY: Proposes Pachulski as Counsel -------------------------------------------- The Official Committee of Unsecured Creditors in Movie Gallery Inc.'s cases seeks the Court's authority to retain Pachulski Stang Ziehl & Jones LLP, in New York, as its lead counsel, nunc pro tunc to February 10, 2010. John Roussey, co-chair of the Creditors Committee and a representative of Universal Studios Home Entertainment, explains to the Court that the Creditors Committee believes that Pachulski is well qualified to act as lead counsel because of the firm's extensive experience representing creditors committees, debtors , creditors, trustees and others in a wide variety of bankruptcy cases. As lead counsel, Pachulski is expected to assist, advise and represent the Creditors Committee in: (a) its consultations with the Debtors regarding the administration of the Chapter 11 cases; (b) the analysis of the Debtors' assets and liabilities, investigation of the extent and validity of liens and participate in and review any proposed asset sales, any asset dispositions, financing arrangements and cash collateral stipulations or proceedings; (c) any manner relevant to the review and determination of the Debtors' rights and obligations under leases and other executory contracts; (d) the investigation of the acts, conduct, assets, liabilities and financial condition of the Debtors, the Debtors' operations and the desirability of the continuance of any portion of those operations, and any other matters relevant to the case or to the formulation of a plan; (e) its participation in the negotiation, formulation and drafting of a plan of liquidation or reorganization; (f) issues concerning the appointment of a trustee or examiner under Section 1104 of the Bankruptcy Code; (g) understanding its powers and its duties under the Bankruptcy Code and the Bankruptcy Rules and in performing other services as are in the interests of those represented by the Committee; and (h) the evaluation of claims and on any litigation matters, including avoidance actions. In exchange for its services, Pachulski will be paid based on its current hourly rates: Professional Hourly Rate ------------ ----------- Robert J. Feinstein, Esq. $855 Robert B. Orgel, Esq. $825 John A. Morris, Esq. $750 Beth E. Levine, Esq. $550 Gabrille A. Rohwer, Esq. $550 David A. Abadir, Esq. $425 Thomas J. Brown $205 Mr. Roussey informs the Court that Pachulski has not received a retainer to represent the Creditors' Committee in the Chapter 11 cases. Robert J. Feinstein, Esq., a partner at Pachulski, assures the Court that his firm does not hold or represent any interest adverse to the Debtors. Further. Mr. Feinstein states that Pachulski is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc. is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Movie Gallery Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Movie Gallery Inc. and affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) MOVIE GALLERY: Wins Approval for Kutak Rock as Co-Counsel --------------------------------------------------------- Movie Gallery Inc. and its units obtained the Court's authority to employ Kutak Rock LLP, in Richmond, Virginia, as their co-counsel. The Debtors have also obtained approval for employ Sonnenschein Nath & Rosenthal LLP, in New York as their attorneys in the Chapter 11 cases. Kutak Rock will serve as conflicts counsel in the Debtors' Chapter 11 cases, to handle matters in connection with matters that the Debtors may encounter that cannot be appropriately handled by Sonnenschein. Kutak Rock has been representing the Debtors in connection with the Debtors' 2007 Bankruptcy Cases. On January 22, 2010, the Debtors entered into the Engagement Letter with Kutak Rock regarding contingency planning and the preparation for the potential commencement and prosecution of their new Chapter 11 cases. As a result of Kutak Rock's prior and current representation of the Debtors, Kutak Rock has become familiar with the Debtors' business, legal and financial affairs. In addition, Kutak Rock is well qualified to represent the Debtors based on its significant bankruptcy practice. As co-counsel to the Debtors and in coordination with Sonnenschein, Kutak Rock will render these services: (a) advise the Debtors with respect to their powers and duties as debtors-in-possession in the continued management and operation of their business and properties; (b) advise consult on the conduct of the Chapter 11 cases, including all legal and administrative requirements of operating in Chapter 11; (c) taking all necessary action to protect and preserve the Debtors' estates, including prosecuting actions on the Debtors' behalf, defending any action commenced against the Debtors and representing the Debtors' interests in negotiations concerning all litigation in which the Debtors are involved, including objections to claims filed against the Debtors' estates; (d) prepare appropriate pleadings, including motions, applications, orders, reports and papers necessary or otherwise beneficial to the administration of the Debtors' estates; (e) act as conflicts counsel to the Debtors in connection with matters that cannot be appropriately handled by Sonnenschein because of a conflict-of-interest or otherwise; and (d) perform all other necessary or otherwise beneficial legal services for the Debtors in connection with the prosecution of the Debtors' Chapter 11 cases. The Debtors intend that the services of Kutak Rock will complement, and not duplicate, the services to rendered by Sonnenschein. The Debtors intend to pay Kutak Rock based on the firm's hourly rates, and reimburse the firm for their reasonable, necessary out-or-pocket expenses. Kutak Rock's hourly rates are: Professional Hourly Rate ------------ ----------- Partners $250 to $525 Of Counsel $200 to $450 Associates $150 to $295 Paraprofessionals $95 to $175 These are the professionals presently expected to have primary responsibility for providing services to the Debtors: Name Hourly Rate ---- ----------- Michael Condyles, Esq. $410 Loc Pfeiffer, Esq. $380 Peter J. Barrett, Esq. $355 Kimberly A. Pierro $260 Jeremy S. Williams, Esq. $240 Matthew J. Kurz, Esq., $230 Michael A. Condyles, Esq., a partner of Kutak Rock, assures the Court that Kutak Rock is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, and Kutak Rock does not hold or represent an interest adverse to the Debtors' estates. A full-text copy of Kutak Rock's Engagement Letter is available for free at http://bankrupt.com/misc/MG_kutakrockengltr.pdf About Movie Gallery Based in Wilsonville, Ore., Movie Gallery, Inc. is the second largest North American video and game rental company, operating stores in the U.S. and Canada under the Movie Gallery, Hollywood Video and Game Crazy brands. Movie Gallery first filed for Chapter 11 on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849 to 07-33853). Kirkland & Ellis LLP and Kutak Rock LLP represented the Debtors. The Company emerged from bankruptcy on May 20, 2008, with private-investment firms Sopris Capital Advisors LLC and Aspen Advisors LLC as its principal owners. William Kaye was appointed plan administrator and litigation trustee. Movie Gallery returned to Chapter 11 protection on February 3, 2009 (Bankr. E.D. Va. Case No. 10-30696). Attorneys at Sonnenschein Nath & Rosenthal LLP and Kutak Rock LLP represent the Debtors in their second restructuring effort. Kurtzman Carson Consultants serves as claims and notice agent. Bankruptcy Creditors' Service, Inc., publishes Movie Gallery Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Movie Gallery Inc. and affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) NEPHROS INC: Posts $711,000 Net Loss in Q3 2009 ----------------------------------------------- Nephros, Inc. filed its quarterly report on Form 10-Q, showing a net loss of $395,000 on $711,000 of revenue for the three months ended September 30, 2009, compared with a net loss of $1.3 million on $393,000 of revenue for the same period of 2008. The Company's balance sheet as of September 30, 2009, showed $3.3 million in assets, $867,000 of debts, and $2.4 million of stockholders' equity. The Company's recurring losses and difficulty in generating sufficient cash flow to meet its obligations and sustain its operations raise substantial doubt about the Company's ability to continue as a going concern. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?579b River Edge, N.J. based Nephros, Inc. has been engaged primarily in the development of hemodiafiltration, or HDF, products and technologies for treating patients with End Stage Renal Disease, or ESRD. NEW LEAF BRANDS: David Tsiang Steps Down as Board Member -------------------------------------------------------- New Leaf Brands Inc. reported that David Tsiang tendered and its Board of Directors accepted his resignation. Mr. Tsiang will remain in his position as the company's Chief Financial Officer. His compensation remains the same. Baywood International, Inc. changed its name effective October 16, 2009 to New Leaf Brands, Inc. to reflect the change in strategic direction with the sale of Baywood's nutraceutical businesses on October 9, 2009. The name change was effective in the market at the open of business October 19, 2009, at which time the Company's ticker symbol changed from BAYW.OB to NLEF.OB. On July 24, 2009, the Company entered into an Asset Purchase Agreement with Nutra, Inc., a subsidiary of Nutraceutical International Corporation. The Company sold substantially all of the rights and assets of Nutritional Specialties' business, including but not limited to its accounts, notes and other receivables, inventory, tangible assets, rights existing under assigned purchase orders, proprietary rights, government licenses, customer lists, records, goodwill and assumed contracts. Certain rights and assets were excluded from the purchased assets, including the right to market, sell and distribute beverages. The Company's new planned strategic direction is to build a beverage company around its New Leaf brand of ready-to-drink teas and other new functional beverages. Even with limited access to capital, the Company has grown the New Leaf brand. New Leaf beverages are sold in 24 states, through 75 distributors and 14 well-known retailers in over 8,000 outlets. The Company sold 118,820 cases of iced tea in the third quarter of 2009, up over 54% from 77,124 cases in the third quarter of 2008. The Company anticipates that, after its debts are repaid and renegotiated, it will be able to raise capital to grow its New Leaf brand as well as develop additional brands. In exchange, Nutra, Inc. agreed to pay an aggregate purchase price of $8,250,000 in cash, less payment of liabilities, a $250,000 retention and certain pre-closing working capital adjustments. Pursuant to the Agreement, the assets of Nutritional Specialties were evaluated at closing to see if they have a minimum net asset value as of the closing date, after giving effect to normal generally accepted accounting principles, adjustments for reserves and except for routine reductions related to normal amortization and depreciation, equal to $1,848,604. If the net asset value was greater or less than $1,848,604 at the closing, the purchase price payable at closing would be increased or decreased by the amount of such difference on a dollar-for-dollar basis. At closing, the net asset value was $2,176,411 and therefore the initial purchase price of $8,250,000 was increased by $327,807. The asset sale contemplated by the Agreement closed on October 9, 2009. The Company is currently in default on notes that mature before November 10, 2009. The Company said $1,364,219 of this debt was paid in October 2009 and the Company intends to convert the remaining debt into equity. In the subsequent period ended as of November 10, 2009, the related party debt holders agreed to convert an aggregate of $3,822,638 of debt and $492,704 of accrued interest into an aggregate of 17,261,368 shares of common stock at a conversion price of $0.25 per share. The effect of these conversion will be a expense of roughly $7,060,000 based on the intrinsic value of the company stock compared to the exercise price. As of November 16, 2009, the shares have not yet been issued. NOVADEL PHARMA: Dec. 31 Balance Sheet Upside Down by $1.3MM ----------------------------------------------------------- NovaDel Pharma Inc. released its annual report, disclosing a net loss of $7.6 million on license fees revenue of $422,000 for the year ended Dec. 31, 2009, compared with a net loss of $9.6 million on revenue of $361,000 a year earlier. The Company's balance sheet showed $4.4 million in total assets and $8.7 in total liabilities resulting to a $1.3 million stockholders' deficit at Dec. 31, 2009. Cash and cash equivalents totaled $2.7 million at Dec. 31, 2009. Highlights during the 2009 fiscal year included: * Entry into licensing agreements with Mist Acquisition, LLC and ECR Pharmaceuticals Company, Inc. to manufacture and commercialize NitroMist(TM) and ZolpiMist(TM), respectively. * Entry into an agreement with Seaside 88, LP to purchase up to 13.0 million shares of common stock. * Entry into an agreement with ProQuest Investments L.P. to convert the outstanding convertible notes and associated liquidated damages notes and accrued interest into shares of the Company's common stock. Steven B. Ratoff, the Company's Chairman and CEO, said "The licensing of Nitromist and Zolpimist as well as the strengthening of our balance sheet provides a solid foundation for accelerating our product development, particularly development of Duromist, a sildenafil citrate oral spray for erectile dysfunction. Furthermore, we look forward to the commercialization of our approved products with the expectation that our partners will formally launch Nitromist and Zolpimist in the second half of 2010." The Company strengthened its balance sheet at Dec. 31, 2009, with the conversion of $3.7 million of convertible notes and related accrued interest and the receipt of $4.0 million of non- refundable licensee fees during the fourth quarter. The license fees are reported as current portion of deferred revenue at Dec. 31, 2009. A full-text copy of the Company's press release on its 4th quarter and full year 2009 results is available for free at http://ResearchArchives.com/t/s?57c2 About NovaDel Pharma Flemington, New Jersey-based NovaDel Pharma Inc. (NYSE AMEX: NVD) -- http://www.novadel.com/-- is a specialty pharmaceutical company developing oral spray formulations for a broad range of marketed drugs. The Company's proprietary technology offers, in comparison to conventional oral dosage forms, the potential for faster absorption of drugs into the bloodstream leading to quicker onset of therapeutic effects and possibly reduced first pass liver metabolism, which may result in lower doses. Oral sprays eliminate the requirement for water or the need to swallow, potentially improving patient convenience and adherence. As of September 30, 2009, the Company had $2.27 million in total assets against $9.67 million in total liabilities, resulting in stockholders' deficit of $7.40 million. The Company filed with the Securities and Exchange Commission its Annual Report for the year ended December 31, 2008, which included an audit opinion with a "going concern" explanatory paragraph. The going-concern explanatory paragraph from NovaDel's independent registered public accounting firm -- J.H. Cohn LLP in Roseland, New Jersey -- expressed substantial doubt, based upon current financial resources, as to whether NovaDel can continue to meet its obligations beyond 2009 without access to additional working capital. ORLEANS HOMEBUILDERS: Gets Nod to Hire Garden City as Claims Agent ------------------------------------------------------------------ Orleans Homebuilders, Inc., et al., sought and obtained permission from the U.S. Bankruptcy Court for the District of Delaware to employ The Garden City Group, Inc., as claims, notice, and balloting agent. GCG will, among other things: a. serve required notices and other pleadings; b. prepare for filing with the Clerk's Office a certificate or affidavit of service that includes an alphabetical list of persons on whom the notice was served, along with their addresses and the date and manner of service; c. maintain copies of proofs of claim and proofs of interest filed in the Debtors' Chapter 11 cases; and d. maintain official claims registers in the Debtors' Chapter 11 cases by docketing proofs of claim and proofs of interest in a claims database. GCG will be compensated based on its agreement with the Debtor. A copy of the agreement is available for free at: http://bankrupt.com/misc/ORLEANS_HOMEBUILDERS_claimsagentpact.pdf Karen B. Shaer, the Executive Vice President and General Counsel of GCG, assured the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. About Orleans Homebuilders Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes, and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in the following 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10684). Curtis S. Miller, Esq., and Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, is the Company's Delaware and restructuring counsel. Cahill Gordon & Reindell LLP is the Company's bankruptcy and restructuring counsel. Blank Rome LLP is the Company's special corporate counsel. FTI Consulting Inc. is the Company's financial advisor. BMO Capital Markets is the Company's M&A advisor. Lieutenant Island Partners is the Company's M&A consultant. The Company estimated its assets and liabilities at $100,000,001 to $500,000,000. ORLEANS HOMEBUILDERS: Sec. 341(a) Meeting Scheduled for April 14 ----------------------------------------------------------------- Roberta A. Deangelis, the Acting U.S. Trustee for Region 3, will convene a meeting of creditors in Orleans Homebuilders, Inc. et al.'s Chapter 11 case on April 14, 2010, at 2:00 p.m. The meeting will be held at J. Caleb Boggs Federal Building, 2nd Floor, Room 2112, 844 King Street, Suite 2207, Lockbox 35, Wilmington, Delaware 19801. 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. Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes, and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in the following 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10684). Curtis S. Miller, Esq., and Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, is the Company's Delaware and restructuring counsel. Cahill Gordon & Reindell LLP is the Company's bankruptcy and restructuring counsel. Blank Rome LLP is the Company's special corporate counsel. FTI Consulting Inc. is the Company's financial advisor. BMO Capital Markets is the Company's M&A advisor. Lieutenant Island Partners is the Company's M&A consultant. The Company's claims and notice agent is Garden City Group Inc. The Company estimated its assets and liabilities at $100,000,001 to $500,000,000. ORLEANS HOMEBUILDERS: Taps Cahill Gordon as Bankruptcy Counsel -------------------------------------------------------------- Orleans Homebuilders, Inc., et al., have sought authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Cahill Gordon & Reindel LLP as bankruptcy and restructuring counsel. Cahill Gordon will, among other things: a. provide legal support with respect to necessary actions to protect and to preserve the estates and assets of the Debtors, including the prosecution of actions on the Debtors' behalf, the defense of any actions commenced against the Debtors, the negotiations of disputes in which the Debtors are involved, and the preparation of objections to claims filed against the Debtors' estates; b. prepare motions, applications, answers, orders, reports, and other papers in connection with the administration of the Debtors' estates; c. negotiate and draft any agreements for the sale or purchase of any or all of the Debtors' assets, if appropriate; and d. negotiate and draft any plan of reorganization and all documents related thereto, including, but not limited to, a disclosure statement, ballots, and other forms for voting thereon. Cahill Gordon will be paid based on the hourly rates of its personnel: Attorneys $360-$888 Paralegals $175-$280 Joel H. Levitin, a partner at Cahill Gordon, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes, and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in the following 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10684). The Company estimated its assets and liabilities at $100,000,001 to $500,000,000. ORLEANS HOMEBUILDERS: Wants FTI Consulting as Financial Advisor --------------------------------------------------------------- Orleans Homebuilders, Inc., et al., have asked for authorization from the U.S. Bankruptcy Court for the District of Delaware to employ FTI Consulting, Inc., as financial advisor. FTI Consulting will, among other things: a. assist the Debtors in the preparation of financial-related disclosures required by the Court, including the Schedules of Assets and Liabilities, the Statements of Financial Affairs, and Monthly Operating Reports; b. assist the Debtors with information and analyses required pursuant to debtor-in-possession financing including the preparation for hearings regarding the use of cash collateral and DIP financing; c. assist with the identification and implementation of short-term cash management procedures; and d. provide advisory assistance in connection with the development and implementation of key employee retention and other critical employee benefit programs. FTI Consulting will be paid based on the hourly rates of its personnel: Senior Managing Director $755-$885 Directors/Managing Directors $545-$725 Consultants/Senior Consultants $270-$515 Administration/Paraprofessionals $110-$225 William Nolan, senior managing director at FTI Consulting, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes, and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in the following 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10684). The Company estimated its assets and liabilities at $100,000,001 to $500,000,000. ORLEANS HOMEBUILDERS: Committee Organizational Meeting March 11 --------------------------------------------------------------- Roberta A. DeAngelis, Acting United States Trustee for Region 3, will hold an organizational meeting on March 11, 2009, at 10:00 a.m. in the bankruptcy case of Orleans Homebuilders, Inc., et al. The meeting will be held at Hotel DuPont, 11th & Market Streets, Wilmington, DE 19801. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. Orleans Homebuilders, Inc. -- aka FPA Corporation, OHB, Parker & Lancaster, Masterpiece Homes, Realen Homes, and Orleans -- develops, builds and markets high-quality single-family homes, townhouses and condominiums. From its headquarters in suburban Philadelphia, the Company serves a broad customer base including first-time, move-up, luxury, empty-nester and active adult homebuyers. The Company currently operates in the following 11 distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey; Orange County, New York; Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater, Virginia; Chicago, Illinois; and Orlando, Florida. The Company's Charlotte, North Carolina operations also include adjacent counties in South Carolina. Orleans Homebuilders employs approximately 300 people. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10684). Curtis S. Miller, Esq., and Robert J. Dehney, Esq., at Morris, Nichols, Arsht & Tunnell, is the Company's Delaware and restructuring counsel. Cahill Gordon & Reindell LLP is the Company's bankruptcy and restructuring counsel. Blank Rome LLP is the Company's special corporate counsel. FTI Consulting Inc. is the Company's financial advisor. BMO Capital Markets is the Company's M&A advisor. Lieutenant Island Partners is the Company's M&A consultant. The Company's claims and notice agent is Garden City Group Inc. The Company estimated its assets and liabilities at $100,000,001 to $500,000,000. OVERSEAS SHIPHOLDING: Second Offering Won't Affect Moody's Ratings ------------------------------------------------------------------ Moody's Investors Service said that the secondary offering by Overseas Shipholding Group, Inc., of 3.5 million shares of its common stock does not affect Moody's debt ratings of OSG. The last rating action on OSG was the August 3, 2009 downgrade, including of the corporate family rating to Ba2. Overseas Shipholding Group, Inc., headquartered in New York City, NY, is one of the largest publicly traded tanker companies in the world, engaged primarily in the ocean transportation of crude oil and petroleum products. PACIFIC ETHANOL: Calif. State Court OKs Settlement with Socius -------------------------------------------------------------- The Superior Court of the State of California for the County of Los Angeles approved a Stipulation for Settlement of Claim between Socius CG II Ltd. and Pacific Ethanol, Inc. The Order provides for the full and final settlement of Socius' $5,000,000 claim against Pacific Ethanol. Socius purchased the Claim from Lyles United LLC, a creditor of Pacific Ethanol, pursuant to the terms of a Purchase and Option Agreement dated effective as of March 2, 2010, between Socius and Lyles United. The Claim consists of the right to receive $5,000,000 of principal amount of and under a loan made by Lyles United to us pursuant to the terms of an Amended and Restated Promissory Note dated Nov. 7, 2008, in the original principal amount of $30,000,000. Pursuant to the terms of the Order, on March 5, 2010, we issued and delivered to Socius 5,800,000 shares of our common stock. The Settlement Shares represent approximately 9.99% of the total number of shares of our common stock outstanding immediately preceding the date of the Order. The total number of shares of our common stock to be issued to Socius or its designee in connection with the Order will be adjusted on the 6th trading day following the date on which the Settlement Shares are issued: * if the number of VWAP Shares exceeds the number of Settlement Shares initially issued, then we will issue to Socius or its designee additional shares of our common stock equal to the difference between the number of VWAP Shares and the number of Settlement Shares; and * if the number of VWAP Shares is less than the number of Settlement Shares, then Socius or its designee will return to us for cancellation that number of shares as equals the difference between the number of VWAP Shares and the number of Settlement Shares. The number of VWAP Shares is equal to * $5,000,000 plus Socius' reasonable legal fees, expenses, and costs; and * divided by 80% of the volume weighted average price of the company's common stock over the 5-day trading period immediately following the date on which the Settlement Shares were issued. In no event will the number of shares of our common stock issued to Socius or its designee in connection with the settlement of the Claim, aggregated with all shares of our common stock then owned or beneficially owned or controlled by, collectively, Socius and its affiliates, at any time exceed (x) 9.99% of the total number of shares of our common stock then outstanding , or (y) without our prior written consent, that number of shares of our common stock that would trigger a new limitation under Internal Revenue Code Section 382. In addition, in no event will the aggregate number of shares of our common stock issued to Socius or its designee in connection with the settlement of the Claim, aggregated with any other shares of our common stock issued to Socius and its designees by us, at any time exceed 19.99% of the total number of shares of our common stock outstanding immediately preceding the date of the Order unless we have obtained either stockholder approval of the issuance of more than such number of shares of our common stock pursuant to NASDAQ Marketplace Rule 5635(d) or a waiver from NASDAQ of our compliance with Rule 5635(d). A full-text copy of the Order Approving Stipulation of Claim is available for free at http://ResearchArchives.com/t/s?5794 A full-text copy of the Purchase and Option Agreement dated March 2, 2010 by and between Lyles United, LLC and Socius CG II, Ltd. containing an Acknowledgment by Pacific Ethanol Inc. is available for free at http://ResearchArchives.com/t/s?5795 A full-text copy of the Option/Purchase Agreement dated March 2, 2010 by and between Lyles Mechanical Co. and Socius CG II, Ltd. containing an Acknowledgment by Pacific Ethanol Inc. is available for free at http://ResearchArchives.com/t/s?5797 About Pacific Ethanol Pacific Ethanol Holding Co. LLC and four affiliates filed for Chapter 11 on May 17, 2009 (Bankr. D. Del. Case No. 09-11713). Judge Kevin Gross handles the case. Attorneys at Cooley Godward Kronish LLP represent the Debtors as counsel. Attorneys at Potter Anderson & Corroon LLP are co-counsel. Epiq Bankruptcy Solutions LLC is the claims agent. Pacific Ethanol Holding disclosed $50 million to $100 million in assets and $100 million to $500 million in debts in its petition. Pacific Ethanol Inc. and its marketing subsidiaries, Kinergy Marketing LLC, and Pacific Ag. Products, LLC, have not filed for Chapter 11 bankruptcy protection. The Company is expected to continue to manage the Plant Subsidiaries under an Asset Management Agreement and Kinergy and PAP are expected to continue to market and sell the Plant Subsidiaries' ethanol and feed production under existing Marketing Agreements. PARKER DRILLING: S&P Assigns 'B+' Rating on $300 Mil. Senior Notes ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'B+' issue-level rating (the same as the corporate credit rating on the company) to Parker Drilling Co.'s new $300 million senior unsecured notes due 2018. In addition, S&P assigned a recovery rating of '3' to this debt, indicating expectations of meaningful (50%-70%) recovery in a payment default. Parker Drilling will use proceeds from the new notes to repay its 9.625% senior notes and for general corporate purposes, including repayment of borrowings outstanding under the revolving credit facility. The corporate credit rating on Parker Drilling is 'B+' and the outlook is stable. "The ratings on Parker reflect the company's participation in a highly competitive, cyclical industry; its large capital spending program; its operations in international markets and areas that can expose it to geopolitical risks, and currently soft industry conditions, given weak gas prices," said Standard & Poor's credit analyst Aniki Saha-Yannopoulos. The ratings also account for the company's business and geographic diversity, its high-profile projects with integrated oil companies, and low debt leverage. Rating List Parker Drilling Co Corporate Credit Rating B+/Stable/-- Rating Assigned Parker Drilling Co $300 Mil. Sr Unsec. Notes Due 2018 B+ Recovery Rating 3 PHILOSOPHY INC: S&P Changes Outlook to Stable; Affirms 'B' Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Phoenix, Arizona-based philosophy Inc. to stable from negative. At the same time, S&P affirmed its ratings on the company, including the 'B' corporate credit rating. "The outlook revision reflects the company's improved operating performance and credit metrics, and S&P's expectation that the company will maintain credit measures close to current levels over the next year," said Standard & Poor's credit analyst Susan ding. The ratings on philosophy Inc. reflect its narrow business focus and participation in the highly competitive and fragmented cosmetics and personal care industries, relatively small sales and earnings base, and significant customer concentration. Philosophy has established good brand loyalty in its niche beauty, personal care, and cosmetic segments. However, the company maintains a narrow product focus in these segments, and competition remains intense. The company competes with other niche players such as Bare Escentuals Beauty Inc. (B+/Watch Positive) and continues to face increasing competitive pressure from larger beauty brands such as The Estee Lauder Cos. Inc. (A/Negative/A-1), in addition to personal care brands of consumer- product giants such as Procter & Gamble Co. (AA-/Stable/A-1+). Intensified competition from these players could adversely affect philosophy's profitability if it has to significantly increase advertising and promotional spending to compete more directly with these companies. Although philosophy has a multichannel-distribution model, there is still substantial channel and customer concentration through direct response television (primarily through QVC), which accounts for just under half of the company's sales. However, Standard & Poor's Ratings Services expects this concentration to decrease somewhat as the company expands sales in other channels, such as specialty retailers and department stores. Nevertheless, the company's revenue and earnings base remains relatively small compared with some of its peers, and its revenues are primarily concentrated in North America. No significant acquisition activity is expected over the intermediate term because the company expects to grow by increasing penetration through its existing channels and by capitalizing on opportunities to expand its business internationally. S&P expects that the company will continue to invest in upgrading its systems and infrastructure to achieve its growth objectives. The outlook is stable. S&P expects the company to maintain its credit metrics close to current levels. S&P would raise the ratings if the company is able to maintain stable operating results and margins remain in the low-to-mid 30% area. Alternatively, S&P would lower the ratings if the company's liquidity becomes constrained and covenant cushions tighten to less than 10%. PNG VENTURES: Wants Exclusive Plan Filing Extended Until May 7 -------------------------------------------------------------- PNG Ventures, Inc., et al., ask the U.S. Bankruptcy Court for the District of Delaware to extend their exclusive periods to file a Chapter 11 plan or plans of reorganization and solicit acceptances thereof until May 7, 2010, and July 6, 2010, respectively. The Debtors have already filed a proposed Chapter 11 Plan of Reorganization. However, out of an abundance of caution, the Debtors are seeking an extension. In the event that the Plan is not confirmed, a further extension will enable the Debtors to (i) negotiate a different plan, and (ii) avoid any possibility of unnecessary litigation and delay created by the filing of a competing plan. The Debtors propose a hearing on their proposed extension on April 9, 2010 at 1:00 p.m. Objections, if any, are due March 15, 2010, at 4:00 p.m. About PNG Ventures PNG Ventures, Inc., produces, distributes, and sells liquefied natural gas to customers within the transportation, industrial, and municipal markets in the western United States and parts of Mexico. The Company sells substantially all of its LNG to fleet customers, who typically own and operate their fueling stations. The Company also sells a small volume of LNG to customers for non- vehicle use. The Company owns one public LNG fueling station from which it sells LNG to numerous parties. The Company produces LNG at its liquefaction plant in Arizona, but also purchases, from time to time, LNG supplies from third parties, typically on spot contracts. The Company sells LNG principally through supply contracts that are normally on an index-plus basis, although it also occasionally enters into fixed-price contracts. The Company is headquartered in Dallas, Texas. The LNG business conducts its operations principally in Arizona and California. Through the Company's LNG business, the Company offers turnkey fuel solutions to its customers, including clean LNG fuel (99% methane gas) and 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. PREMIER GENERAL: Must Answer Involuntary Petition by March 17 ------------------------------------------------------------- ABI reports that the same creditors that put the affiliate of water well drilling company Premier General Holdings Ltd. into bankruptcy involuntarily eight months ago have done it again. In July 2009, Dean Davenport, which has filed a lawsuit against Premier, petitioned to force Premier into involuntary bankruptcy. A court filing by Premier before the Supreme Court of Texas said that in 1999, Mark Wynne, James Allen, and Dean Davenport formed a partnership named Water Exploration Co., Inc. Its purpose was to drill for water in the Middle Trinity Aquifer in Northern Bexar County, and to sell the water produced to the City of San Antonio and Bexar Metropolitan Water District. Each of the three partners owned a 33% interest in WECO through their respective limited partnerships: Premier General Holdings, Ltd. (Wynne), J. Allen Family Partners, Ltd. (Allen), and Dillon Water Resources, LP (Davenport). The remaining 1% interest in WECO was owned by a general partnership named WAD, Inc., an acronym for the partners' last names. Several years into the venture, the relationship between Wynne and Allen on the one hand and Davenport on the other became strained and they discussed getting a "divorce." Ultimately, the partners became embroiled in litigation involving multiple claims and counterclaims. The pertinent claim is the one by Davenport and his limited partnership, Dillon, alleging that Wynne and Allen, and their respective partnerships, "converted" Dillon's 33% partnership interest in WECO. A trial court awarded $70 million to Dillon as the purported "value" of Dillon's 33% interest in WECO. The trial court ultimately relied on that "value" in awarding $60 million in actual damages against Premier, after deducting a settlement credit. Davenport reasoned that if he could force Premier into involuntary bankruptcy, he could compel Premier to sell the very 33% interest Mr. Wynne and Premier refused to voluntarily give up. Following a hearing, the bankruptcy court entered an order on October 19, 2009 that "PREMIER GENERAL HOLDINGS, LTD., is not an appropriate candidate to have an Order for Relief entered against it as contemplated by 11 U.S.C. 303. PRINCETON OFFICE: Tax Sale Cert. Holder Didn't Hold Tax Claim ------------------------------------------------------------- An entity that acquired a tax sale certificate at a prepetition tax sale conducted in accordance with New Jersey law, by paying a governmental entity the delinquent property taxes owed by the debtor-limited partnership, did not qualify as the holder of a "tax claim," and was not protected by 11 U.S.C. Sec. 511(a)'s antimodification provision from having the debtor-limited partnership, as part of its proposed Chapter 11 plan, from reducing the interest rate payable on its claim from the 18% rate established by state statute to a market rate. Under New Jersey law, the entity did not hold a claim for taxes, which it had previously paid to the government entity, but merely a statutory lien, which could be satisfied by payment of the sum that it paid to acquire the tax sale certificate together with interest. Princeton Office Park, L.P., --- B.R. ----, 2010 WL 596500 (Bankr. D. N.J.) (Kaplan, J.). About Princeton Office Park Headquartered in Morristown, N.J., Princeton Office Park, LP, is a real estate development company that owns a 170,000 square-foot building on 37 acres located at 4100 Quakerbridge Road in Lawrence Township, N.J. The property has been re- zoned for multi-family residental use at 10 units per acre or 370 units. Princeton Office Park GP, L.P. holds a 50% equity interest in the Debtor. Princeton GP's general partner is United States Land Resources, L.P., a New Jersey limited partnership, whose general partner is United States Realty Resources, Inc., a New Jersey corporation. Lawrence S. Berger is the president of USRR. The Debtor's limited partners is Success Truehand GmbH, which holds a 31.67% equity interest in the Debtor. The Company sought Chapter 11 protection (Bankr. D. N.J. Case No. 08-27149) on September 9, 2008. Melissa A. Pena, Esq., at Norris, McLauglin & Marcus, in New York, and Morris S. Bauer, Esq., at Norris McLaughlin & Marcus PA, in Bridgewater, New Jersey, represent the Debtor. In its schedules, the Debtor disclosed total assets of $25,000,000 and total debts of $2,517,370. On June 10, 2009, the Debtor filed a Plan and Disclosure Statement, which provided for extended satisfaction of Plymouth Park's tax sale certificate claim and lowering the interest rate to 6% to reflect the market interest rate at the time. The Plan also proposed that Debtor would execute a note and mortgage to secure its obligation to Plymouth Park. That plan has been confirmed or is rapidly moving toward confirmation. PROVO CRAFT: S&P Assigns Corporate Credit Rating at 'B' ------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Spanish Fork, Utah-based Provo Craft and Novelty Inc. The outlook is stable. In addition, Standard & Poor's assigned its issue-level and recovery ratings to Provo's proposed $170 million senior secured credit facility, which is comprised of a $50 million five-year revolving credit facility and $120 million six-year term loan credit facility. The $170 million senior secured credit facility is rated 'B+', one notch higher than the corporate credit rating. The recovery rating is '2', indicating S&P's expectation that lenders will have substantial (70%-90%) recovery in the event of a payment default. "The ratings on Provo reflect the company's narrow business focus in a small segment of the overall crafts industry, small revenue base, high customer concentration, and limited operating history," said Standard & Poor's credit analyst Jacqueline Hui. The company benefits from well-recognized brands in the paper crafts industry and solid margins. Provo is a designer and marketer of craft products, marketed primarily under the Cricut brand. Cricut products include electronic cutting systems machines and supplemental cartridges and other crafts-related accessories. The company distributes the majority of its products through craft retail chains, mass merchants, warehouse retailers and independent specialty retailers. The Cricut brand has high brand awareness and Provo holds the market dominant position within the electronic cutting systems market, but the $270 million electronic cutting systems market is a small segment within the $4 billion paper crafts industry. Though the paper crafts industry grew at a compound annual growth rate of about 9% from 2005 to 2007, it is susceptible to discretionary consumer spending and experienced softness during the recent economic downturn. In addition, the company has high customer concentration, with the top three customers accounting for 43% of 2009 total revenues. The stable outlook reflects S&P's expectation that the company will maintain its strong market positions and solid operating performance over the near term despite the current weak economic environment. S&P could consider a rating upgrade if the company successfully further diversifies its business and strong operating performance continues, with leverage maintained in the mid-3x area. S&P estimate this could occur if EBITDA increases 10% (assuming debt levels do not significantly change from current levels). Alternatively, S&P could consider a downgrade if the company's operating results weaken, causing leverage to exceed 5x, liquidity to tighten, and covenant cushion levels to decrease below 10%. S&P estimates leverage could exceed 5x if EBITDA declined 30% (assuming debt levels do not significantly change from current levels). PUREDEPTH INC: To Deregister Common Stock ----------------------------------------- PureDepth Inc. said that it filed post-effective amendments to each of its outstanding registration statements to deregister remaining but unsold shares of common stock. The Company also said that it intends to voluntarily deregister its common stock on or about March 15, 2010, with the Securities and Exchange Commission. The Company's obligation to file certain reports with the SEC, including Forms 10-K, 10-Q, and 8K, will immediately be suspended. As a result of the filing, the company expects that its shares will no longer be quoted on the OTC Bulletin Board. However, PureDepth anticipates, but cannot guarantee, that its common stock may be quoted on the Pink Sheets after it delists. The Pink Sheets is a provider of pricing and financial information for the over-the-counter securities markets. It is a centralized quotation service that collects and publishes market maker quotes in real time primarily through its website, www.pinksheets.com, which provides stock and bond price quotes, financial news, and information about securities. PureDepth does not have plans to seeking the listing of its common stock on the OTCQX. CEO Wood to Reduce Hours PureDepth said that CEO Andy Wood will reduce his hours with the Company and begin working half-time, effective immediately. Mr. Wood stated, "After much consideration, our management team and board of directors determined that the benefits of continued registration no longer outweighed the financial and administrative burdens imposed by the reporting requirements. PureDepth was spending more than $750,000 per year and significant management time on compliance issues, money and time that would be better spent investing in our markets and technology. This need to conserve the company's cash resources is also the reason that I have agreed with the Board to work half-time, at half salary. "We believe that the actions we are announcing today will allow us to run our business most efficiently as we continue to promote and develop new applications and markets for MLD technology," Mr. Wood noted About PureDepth PureDepth, Inc., along with its wholly owned subsidiaries, PureDepth Limited, PureDepth Incorporated Limited, PureDepth Japan KK, and predecessor parent entity, Deep Video Imaging Limited, develops, markets, licenses, and supports multi-layer display technology. The Company also sells prototype MLD-enabled display devices and related components that it manufactures. The Company's technology has application in industries and markets where LCD monitors and displays are utilized including location based entertainment, computer monitors, telecommunications, mobile phones and other hand held devices. At October 31, 2009, the Company had total assets of $7,519,777 against total liabilities of $16,857,577, resulting in stockholders' deficit of $9,337,800. QUAD/GRAPHICS INC: Moody's Assigns 'Ba2' Corporate Family Rating ---------------------------------------------------------------- Moody's Investors Service assigned first time ratings to Quad/Graphics, Inc., of Ba2 corporate family rating, Ba2 probability of default rating and an SGL-3 speculative grade liquidity rating (indicating adequate liquidity arrangements); the rating outlook is stable. The company's senior secured credit facilities were rated Ba2, the same level as the CFR. Pending regulatory approval and normal pre-conditions including shareholder approvals, Quad will acquire World Color Press Inc. This is a transformational transaction. Although Quad has a reputation for being an efficient, low cost operator, Worldcolor's revenue base is just over 70% larger than Quad's and is accompanied by a much higher cost structure. Success depends on quickly and cost-effectively eliminating redundant operations so that the continuing entity's capacity utilization increases and it takes on Quad's cost structure. Moody's also anticipate that near term capital expenditures can be temporarily suppressed as capacity is rationalized. The friendly nature of the business combination has provided Quad with ample time to formulate credible integration plans, however, the differences in the scale and the magnitude of anticipated synergies (+/- 5% of pro forma Revenues) suggest that execution risks are material. Risks are amplified by secular pressures that significantly limit growth prospects for companies in the North American commercial printing industry. In turn, execution set-backs will not be masked by market growth. As well, liquidity planning is relatively aggressive; should the company suffer a material set-back, the liquidity cushion may be quickly eroded. Assignments: Issuer: Quad/Graphics Inc. -- Corporate Family Rating, Assigned Ba2 -- Probability of Default Rating, Assigned Ba2 -- Speculative Grade Liquidity Rating, Assigned SGL-3 -- Outlook, Assigned Stable -- Senior Secured Bank Credit Facility, Assigned Ba2 (LGD3, 46%) Quad has not previously been rated by Moody's; this action is the Moody's first for the company. Quad's ratings were assigned by evaluating factors Moody's believes are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Quad's core industries and Quad's ratings are believed to be comparable to those of other issuers of similar credit risk. Headquartered in Sussex, Wisconsin, Quad/Graphics, Inc. (Quad), is a leading North American commercial printing company. The company is in the process of acquiring World Color Press Inc., the second- largest commercial printer in North America, which is based in Montreal, Quebec, Canada. QUAD/GRAPHICS INC: S&P Assigns 'BB' Corporate Credit Rating ----------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' corporate credit rating to Sussex, Wisconsin-based Quad/Graphics Inc. in connection with its acquisition of print industry competitor, World Color Press Inc. At the same time, S&P assigned its issue-level and recovery ratings to the company's proposed $1.2 billion senior secured credit facility, consisting of an $800 million term loan due 2016 and a $400 million revolving credit facility due 2014, the proceeds of which will finance the acquisition. The credit facility is rated 'BB+' (one notch higher than the corporate credit rating on the company) with a recovery rating of '2', indicating S&P's expectation of substantial (70% to 90%) recovery for lenders in the event of payment default. "The 'BB' corporate credit rating reflects the highly competitive printing business in which Quad operates, significant revenue volatility over the economic cycle, uncertainties related to the sustainability of the emerging recovery in printing, and meaningful integration risks related to the acquisition of World Color," said Standard & Poor's credit analyst Michael Listner. "These factors are somewhat offset by S&P's expectation that the acquisition will expand Quad's geographic footprint and customer base, while enabling the company to realize a meaningful level of cost synergies over the next several years through the elimination of excess printing capacity and overlapping administrative functions." Although pro forma credit measures are good for the rating, S&P believes that the scale of the transaction presents integration risks, including potential lost sales from contract terminations, the potential for integration costs to exceed management's expectations, and timing delays in realizing synergies. Still, Quad maintains one of the most efficient operating platforms across the printing industry, as evidenced by one of the highest EBITDA margins (18% in 2009). Given expected good credit measures for the company, the rating can withstand a relatively high level of variability in the timing of synergies, as well as the costs incurred to realize those savings. S&P is projecting a mid-single-digit percentage decline in 2010 revenues compared to pro forma revenues of $4.9 billion in 2009. However, expect that EBITDA will grow in the mid-single-digit percentage area as a result of a modest amount of synergies realized during the second half of 2010 (assuming the acquisition closes in the summer of 2010). The 'BB' rating reflects its expectation that revenue will decline in the mid-single-digit percentage area in 2011, as a result of incremental lost sales and continued price degradation, but that the company will begin to realize a more significant level of synergies during that year, leading to growth in EBITDA in the low-teens percentage area. Based on these operating assumptions (as well as S&P's expectation that free cash flow will be used to prepay term debt), its measure of leverage (adjusted for underfunded pension obligations at World Color and operating leases) could improve to the low- to mid-2x range at the end of 2011 from about 2.7x expected at the end of 2010. Key risks to improving leverage are revenue variability and integration underperformance. R STAR RESTAURANTS: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: R Star Restaurants, Inc. dba Lone Star Steakhouse dba Lone Star Steakhouse & Saloon 1222 East Irvine Boulevard Tustin, CA 92780 Bankruptcy Case No.: 10-12892 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Central District of California (Santa Ana) Judge: Theodor Albert Debtor's Counsel: Thomas J. Polis, Esq. Polis & Associates, APLC 19800 MacArthur Blvd., Ste 1000 Irvine, CA 92612-2433 Tel: (949) 862-0040 Fax: (949) 862-0041 Email: tom@polis-law.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 $2,060,438, and total debts of $3,426,812. 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/cacb10-12892.pdf The petition was signed by Gregg H. Rotcher, president of the Company. RAYMOND HERMAN MEHNER: Voluntary Chapter 11 Case Summary -------------------------------------------------------- Debtor: Raymond Herman Mehner aka Ray Mehner 1416 Galaxy Drive Hinton, IA 51024 Bankruptcy Case No.: 10-80627 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court District of Nebraska (Omaha Office) Debtor's Counsel: Jenna B. Taub, Esq. Jenna Taub Law 11930 Arbor Street, Suite 202 Omaha, NE 68145 Tel: (402) 210-2335 Email: jenna@jennalaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $1,000,001 to $10,000,000 The Company says it does not have unsecured creditors who are non insiders when they filed their petition. The petition was signed by Mr. Mehner. RC SOONER: Gets Interim Nod to Use Fannie Mae's Cash Collateral --------------------------------------------------------------- RC Sooner Holdings, LLC, et al., sought and obtained interim authorization from the U.S. Bankruptcy Court for the District of Delaware to use the cash collateral of Federal National Mortgage Association, aka Fannie Mae. Christopher S. Chow, Esq., and Matthew G. Summers, Esq., at Ballard Spahr LLP, the attorneys for the Debtors, explain that the Debtors need the money to fund their Chapter 11 case, pay suppliers and other parties. The Debtors will use the collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/RC_SOONER_budget.pdf In exchange for using the cash collateral, the Debtors propose to grant Fannie Mae additional and replacement security interests and liens. The Debtors will provide Fannie Mae, within 20 days following the end of each prior month, a report summarizing income received by the Debtors and expenses paid by the Debtors during the prior month. The Court has set a final hearing for March 11, 2010, at 9:00 a.m., on the Debtors' request to use cash collateral. Wilmington, Delaware-based RC Sooner Holdings, LLC, filed for Chapter 11 bankruptcy protection on February 22, 2010 (Bankr. D. Delaware Case No. 10-10528). Christopher S. Chow, Esq., at Ballard Spahr Andrews & Ingersoll, LLP, assists the Company in its restructuring effort. The Company estimated its assets and debts at $10,000,001 to $50,000,000. REGENT COMMUNICATIONS: Gets Court OK to Hire KCC as Claims Agent ---------------------------------------------------------------- Regent Communications, Inc., et al., sought and obtained interim authorization from the Hon. Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware to employ Kurtzman Carson Consultants LLC as notice, claims and solicitation agent. KCC will, among other things: a. prepare and serve notices in the Chapter 11 cases; b. receive, examine, and maintain copies of proofs of claim and proofs of interest filed in the Debtors' Chapter 11 cases; c. maintain official claims registers in the Debtors' Chapter 11 cases by docketing proofs of claim and proofs of interest in a claims database; and d. record transfers of claims. KCC will be compensated for its services based on its services agreement with the Debtors. A copy of the agreement is available for free at http://bankrupt.com/misc/REGENT_COMM_servicespact.pdf Albert Kass, vice president of corporate restructuring services at KCC, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Headquartered in Cincinnati, Ohio, Regent Communications, Inc., is a radio broadcasting company that acquires, develops, and operates radio stations. There are 47 subsidiary entities with 62 radio stations in markets in Colorado, Illinois, Indiana, Kentucky, Louisiana, Michigan, Minnesota, New York, and Texas. Regent Communications focuses on radio stations in mid-sized market that are diversified in terms of geographic location, target demographics and format in order to minimize the effects of downturns in specific markets and changes in format preferences. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10632). Michael R. Nestor, Esq., at Young Conaway Stargatt & Taylor, assists the Company in its restructuring effort. As of January 31, 2010, the Company had $166,506,000 in assets and $211,282,000 in liabilities. REGENT COMMUNICATIONS: Sec. 341(a) Meeting Scheduled for March 31 ----------------------------------------------------------------- The U.S. Trustee for Region 3 will convene a meeting of creditors in Regent Communications, Inc., et al.,'s Chapter 11 case on March 31, 2010, at 11:00 a.m. The meeting will be held at J. Caleb Boggs Federal Building, 844 North King Street, 2nd Floor, Room 2112, Wilmington, Delaware 19801. 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 Cincinnati, Ohio, Regent Communications, Inc., is a radio broadcasting company that acquires, develops, and operates radio stations. There are 47 subsidiary entities with 62 radio stations in markets in Colorado, Illinois, Indiana, Kentucky, Louisiana, Michigan, Minnesota, New York, and Texas. Regent Communications focuses on radio stations in mid-sized market that are diversified in terms of geographic location, target demographics and format in order to minimize the effects of downturns in specific markets and changes in format preferences. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10632). Michael R. Nestor, Esq., at Young Conaway Stargatt & Taylor, assists the Company in its restructuring effort. As of January 31, 2010, the Company had $166,506,000 in assets and $211,282,000 in liabilities. REGENT COMMUNICATIONS: Taps Young Conaway as Delaware Counsel ------------------------------------------------------------- Regent Communications, Inc., et al., have sought authorization from the U.S. Bankruptcy Court for the District of Delaware to employ Young Conaway Stargatt & Taylor, LLP, as Delaware bankruptcy counsel, nunc pro tunc to the Petition Date. Younmg Conaway will, among other things: a. prepare and pursue confirmation of a plan and approval of a disclosure statement; b. prepare applications, motions, answers, orders, reports, and other legal papers; c. appear in Court and to protect the interests of the Debtors before the Court; and d. perform all other legal services for the Debtors which may be necessary and proper in the proceedings. The Debtors are also seeking to hire Latham & Watkins, LLP, as bankruptcy co-counsel. Young Conaway and L&W have discussed a division of responsibilities and will make every effort to avoid duplication of effort in the Debtors' bankruptcy cases. Younmg Conaway will be paid based on the hourly rates of its personnel: Michael R. Nestor, Partner $610 Kara Hammond Coyle, Associate $355 Michael S. Neiburg, Associate $285 Morgan L. Seward, Associate $265 Debbie Laskin, Paralegal $220 Michael R. Nestor, a partner at Young Conaway, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Headquartered in Cincinnati, Ohio, Regent Communications, Inc., is a radio broadcasting company that acquires, develops, and operates radio stations. There are 47 subsidiary entities with 62 radio stations in markets in Colorado, Illinois, Indiana, Kentucky, Louisiana, Michigan, Minnesota, New York, and Texas. Regent Communications focuses on radio stations in mid-sized market that are diversified in terms of geographic location, target demographics and format in order to minimize the effects of downturns in specific markets and changes in format preferences. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10632). As of January 31, 2010, the Company had $166,506,000 in assets and $211,282,000 in liabilities. REGENT COMMUNICATIONS: Wants Latham & Watkins as Co-Counsel ----------------------------------------------------------- Regent Communications Inc., et al., have asked for permission from the U.S. Bankruptcy Court for the District of Delaware to employ Latham & Watkins LLP as bankruptcy co-counsel, nunc pro tunc to the Petition Date. L&W will, among other things: a. attend meetings and negotiate with representatives of creditors, interest holders and other parties-in-interest; b. take necessary action to protect and preserve the Debtors' estates, including prosecuting actions on the Debtors' behalf, defending any action commenced against the Debtors and representing the Debtors' interests in negotiations concerning litigation in which the Debtors are involved, including objections to claims filed against the estates; c. prepare motions, applications, answers, orders, reports, and papers necessary to the administration of the Debtors' estates; and d. take necessary action on behalf of the Debtors to obtain approval of a disclosure statement and confirmation of a plan. The Debtors have also employed Young Conaway Stargatt & Taylor, LLP, as Delaware bankruptcy counsel. L&W has advised the Debtors that it will carefully monitor and coordinate with YCS&T and any other professionals retained by the Debtors and will clearly delineate their respective duties, to prevent duplication of effort. L&W will be paid based on the hourly rates of its personnel: Partners $750-$1,090 Counsel $695-$1,065 Associates $370-$740 Paraprofessionals $95-$430 Josef S. Athanas, a partner at L&W, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Headquartered in Cincinnati, Ohio, Regent Communications, Inc., is a radio broadcasting company that acquires, develops, and operates radio stations. There are 47 subsidiary entities with 62 radio stations in markets in Colorado, Illinois, Indiana, Kentucky, Louisiana, Michigan, Minnesota, New York, and Texas. Regent Communications focuses on radio stations in mid-sized market that are diversified in terms of geographic location, target demographics and format in order to minimize the effects of downturns in specific markets and changes in format preferences. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. D. Delaware Case No. 10-10632). As of January 31, 2010, the Company had $166,506,000 in assets and $211,282,000 in liabilities. REPUBLIC STORAGE: Court Closes Chapter 11 Reorganization Case ------------------------------------------------------------- The Hon. Russ Kendig of the U.S. Bankruptcy Court for the Northern District of Ohio has closed the Chapter 11 case of The Belden Locker Company, fka Republic Storage Systems Company, Inc. Based in Canton, Ohio, Republic Storage Systems Company Inc. nka The Belden Locker Company -- http://www.republicstorage.com/-- manufactured several lines of shelving and storage products including lockers, industrial storage products, custom designed mezzanine systems and engineered storage systems. The Company filed for Chapter 11 protection on March 14, 2006 (Bankr. N.D. Ohio Case No. 06-60316). James Michael Lawniczak, Esq., Karen A. Visocan, Esq., Lisa M. Yerrace, Esq., Nathan A. Wheatley, Esq., and Laura McBride, Esq, at Calfee, Halter & Griswold LLP, represent the Debtor in its restructuring efforts. Dov Frankel, Esq., Harry W. Greenfield, Esq., at Buckley King, LPA; and Wanda Borges, Esq., at Borges Donovan Attorneys at Law, LLC, represent the official committee of unsecured creditors. When the Debtor filed for protection from its creditors, it listed between $10 million and $50 million in assets and debts. REVLON INC: Proposes Refinancing of Credit Facilities ----------------------------------------------------- Revlon Consumer Products Corporation, the wholly owned operating subsidiary of Revlon Inc., said it is exploring refinancing of its existing credit facilities, including its term loan facility and revolving credit facility. A revised term sheet that RCPC is discussing with the potential lenders involved in refinancing RCPC's existing term loan facility is available for free at http://ResearchArchives.com/t/s?57c8 The proposed refinancing transactions are expected to close and fund in early- to mid-March 2010. Consummation of the refinancing is subject to market and other customary conditions, including, among other things, the execution of definitive documentation and perfection of security interests in collateral. There can be no assurances as to the terms and conditions on which the possible refinancing may be finalized and closed, nor that the possible refinancing will be finalized and closed. Headquartered in New York City, Revlon, Inc. (NYSE: REV) -- http://www.revloninc.com/-- is a worldwide cosmetics, hair color, beauty tools, fragrances, skincare, anti-perspirants/deodorants and personal care products company. The Company's brands, which are sold worldwide, include Revlon(R), Almay(R), Mitchum(R), Charlie(R), Gatineau(R), and Ultima II(R). At September 30, 2009, Revlon had $802.0 million in total assets against total current liabilities of $315.2 million, long-term debt of $1.147 billion, long-term debt - affiliates of $107.0 million, long-term pension and other post-retirement plan liabilities of $209.3 million, other long-term liabilities of $66.1 million, resulting in $1.04 billion in stockholders' deficiency. At September 30, 2009, the Company had a liquidity position of $173.2 million, consisting of cash and cash equivalents (net of any outstanding checks) of $59.7 million, as well as $113.5 million in available borrowings under the 2006 Revolving Credit Facility. RICHMOND HILLS: Case Summary & 16 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Richmond Hills Residential Partners, LLC 3317 Masonboro Loop Road, Ste 150 Wilmington, NC 28409 Bankruptcy Case No.: 10-01808 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Eastern District of North Carolina (Wilson) Judge: Stephani W. Humrickhouse Debtor's Counsel: Trawick H. Stubbs, Jr., Esq. Stubbs & Perdue, P.A. P.O. Drawer 1654 New Bern, NC 28563 Tel: (252) 633-2700 Fax: (252) 633-9600 Email: efile@stubbsperdue.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 16 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/nceb10-01808.pdf The petition was signed by Stephen D. Saieed, member-manager of the Company. ROBERT DUNHAM: Case Summary & 7 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Robert W. Dunham 6010 Restview Drive Harrisburg, PA 17112 Bankruptcy Case No.: 10-01801 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Middle District of Pennsylvania (Harrisburg) Judge: Mary D. France Debtor's Counsel: Craig A. Diehl, Esq. 3464 Trindle Road Camp Hill, PA 17011-4436 Tel: (717) 763-7613 Fax: (717) 763-8293 Email: cdiehl@cadiehllaw.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $0 to $50,000 A full-text copy of Mr. Dunham's petition, including a list of his 7 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/pamb10-01801.pdf The petition was signed by Mr. Dunham. ROBERT NAGY: Case Summary & 14 Largest Unsecured Creditors ---------------------------------------------------------- Joint Debtors: Robert S. Nagy Leah J. Therasse dba Therasse Rentals 13831 Edinboro Plank Road Cambridge Springs, PA 16403 Bankruptcy Case No.: 10-10404 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Western District of Pennsylvania (Erie) Judge: Thomas P. Agresti Debtors' Counsel: Gary V. Skiba, Esq. The McDonald Group, L.L.P. 456 West Sixth Street P.O. Box 1757 Erie, PA 16507 Tel: (814) 456-5318 Fax: (814) 456-3840 Email: gskiba@tmgattys.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 14 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/pawb10-10404.pdf The petition was signed by the Joint Debtors. ROSE LEE TAYLOR: Case Summary & 6 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Rose Lee Taylor 4945 Farmwood Drive Memphis, TN 38116 Bankruptcy Case No.: 10-22568 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Western District of Tennessee (Memphis) Judge: Paulette J. Delk Debtor's Counsel: Steven Lee Lefkovitz, Esq. Lefkovitz & Lefkovitz 618 Church Street, #410 Nashville, TN 37219 Tel: (615) 256-8300 Email: slefkovitz@lefkovitz.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $100,000 to $500,000 According to the schedules, the Company has assets of $1,236,900, and total debts of $383,261. A full-text copy of Ms. Taylor's petition, including a list of her 6 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/tnwb10-22568.pdf The petition was signed by Ms. Taylor. RQB RESORT: Files List of 20 Largest Unsecured Creditors -------------------------------------------------------- RQB Resort, LP, has filed with the U.S. Bankruptcy Court for the Middle District of Florida a list of its 20 largest unsecured creditors. A full-text copy of the list is available for free at: http://bankrupt.com/misc/flmb10-01596.pdf Ponte Vedra Beach, Florida-based RQB Resort, LP, aka Sawgrass Marriott Resort & Cabana Club, filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. M.D. Fla. Case No. 10-01596). The Company's affiliate -- RQB Development, LP, aka Sawgrass Marriott Golf Villas & Spa -- filed a separate Chapter 11 petition. Cynthia C. Jackson, Esq., at Smith Hulsey & Busey, assists the Company in its restructuring effort. The Company estimated its assets and debts at $100,000,001 to $500,000,000. RQB RESORT: Gets 35-Day Extension for Filing of Schedules --------------------------------------------------------- The Hon. Paul M. Glenn of the U.S. Bankruptcy Court for the Middle District of Florida has extended, at the behest of RQB Resort, LP, and RQB Development, LP, the deadline for the filing of consolidated creditor matrix, schedule of current income and expenditure, schedules of assets and liabilities, statements of financial affairs, and lists of unexpired leases and executory contracts until April 19, 2010. The Debtors combined have approximately 300 creditors. The Debtors said that given the size and complexity of their businesses, the Debtors require additional 35 days from the previous March 15 deadline to complete their schedules and statements. Ponte Vedra Beach, Florida-based RQB Resort, LP, aka Sawgrass Marriott Resort & Cabana Club, filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. M.D. Fla. Case No. 10-01596). The Company's affiliate -- RQB Development, LP, aka Sawgrass Marriott Golf Villas & Spa -- filed a separate Chapter 11 petition. Cynthia C. Jackson, Esq., at Smith Hulsey & Busey, assists the Company in its restructuring effort. The Company estimated its assets and debts at $100,000,001 to $500,000,000. RQB RESORT: Section 341(a) Meeting Scheduled for April 14 --------------------------------------------------------- The U.S. Trustee for Region 21 will convene a meeting of creditors in RQB Resort, LP's Chapter 11 case on April 14, 2010, at 12:00 p.m. The meeting will be held at FIRST FLOOR, 300 North Hogan St. Suite 1-200, Jacksonville, FL 32202. 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. Ponte Vedra Beach, Florida-based RQB Resort, LP, aka Sawgrass Marriott Resort & Cabana Club, filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. M.D. Fla. Case No. 10-01596). The Company's affiliate -- RQB Development, LP, aka Sawgrass Marriott Golf Villas & Spa -- filed a separate Chapter 11 petition. Cynthia C. Jackson, Esq., at Smith Hulsey & Busey, assists the Company in its restructuring effort. The Company estimated its assets and debts at $100,000,001 to $500,000,000. RQB RESORT: Taps Smith Hulsey as Bankruptcy Counsel --------------------------------------------------- RQB Resort, LP, and RQB Development, LP, have asked for authorization from the U.S. Bankruptcy Court for the Middle District of Florida to employ Smith Hulsey & Busey as bankruptcy counsel, nunc pro tunc to March 1, 2010. Smith Hulsey will represent the Debtors in their Chapter 11 cases. Smith Hulsey will be paid based on the hourly rates of its personnel: Attorneys $180-$455 Paralegals $155 The Debtors assure the Court that Smith Hulsey is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Ponte Vedra Beach, Florida-based RQB Resort, LP, aka Sawgrass Marriott Resort & Cabana Club, filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. M.D. Fla. Case No. 10-01596). The Company's affiliate -- RQB Development, LP, aka Sawgrass Marriott Golf Villas & Spa -- filed a separate Chapter 11 petition. The Company estimated its assets and debts at $100,000,001 to $500,000,000. RUBICON US: Noteholders Win Approval to File Rival Plan ------------------------------------------------------- Michael Bathon at Bloomberg News reported that U.S. Bankruptcy Judge Brendan Linehan Shannon terminated Rubicon US REIT Inc.'s exclusive period to propose a Chapter 11 plan, giving the noteholders owed $81.1 million the right to file a competing plan. "I acknowledge that terminating exclusivity is an extraordinary step," Judge Shannon said at a hearing on March 9. "There is a basic disagreement on what direction this case should go," and "the circumstances of this case merit termination of exclusivity," he said. The noteholders claim Rubicon is pursuing "a sale process where they would take a significant haircut" compared to a proposal they have crafted. A plan by noteholders would allow them to "take the equity and sell the assets over time," Joseph P. Davis, an attorney for the noteholders, told Judge Shannon. The Rubicon Noteholders consist of the holders of 100% of the global senior notes, which include affiliates of Starwood Capital Group Global, LLC, KJ Mandrake LLC, JPMorgan Chase Funding Inc. and N-Real Estate CDO IX, Ltd. Noteholders' Allegations A group of holders of notes issued by Rubicon US REIT filed -- only three weeks in to the case -- a motion for an order terminating the exclusive periods for Rubicon to propose and solicit acceptances of a plan. The Rubicon Noteholders say extraordinary circumstances warrant the immediate relief. They say the Debtors were forced to file for bankruptcy as a result of a series of "disastrous errors committed by their directors and their attorney." Rubicon, according to the Noteholders, entered into a one-sided, secret letter of intent with Global Asset Capital LLC that put "Rubicon and the other Debtors on a disastrous and value-diminishing course". According to counsel, Dennis A. Meloro, Esq., at Greenberg Traurig, LLP, as a result of entering into the LOI and its subsequent breaches, Rubicon found itself a defendant in the Chancery Court Litigation and the subject of the TRO which enjoined Rubicon from: (i) disclosing any of the contents of the LOI without prior written consent of GAC; (ii) soliciting or entertaining any third party offers involving any of the Sale Properties set forth in the LOI for the duration of the LOI; and (iii) asserting that the LOI had terminated pursuant to the termination provisions set forth therein. With the TRO in effect, Rubicon faced a dilemma: (i) remain out of bankruptcy to be embroiled in costly litigation with GAC while the terms of the TRO enjoined Rubicon from, inter alia, entertaining any alternative proposals for an out-of-court sales process or a workout, which would maximize the value of the enterprise; or (ii) negotiate a stalking horse agreement and settlement with GAC that would require a chapter 11 filings. Following entry of the TRO, without any negotiating leverage, Rubicon entered into settlement discussions with GAC, resulting in the execution of the Exclusive Negotiating Rights Agreement. Among other things, the Exclusivity Agreement (i) requires the Debtors to file for Chapter 11 by January 20, 2010; (ii) requires the Debtors to use their best efforts to negotiate a stalking horse agreement for the Sale Properties in accordance with onerous terms contained in an attached term sheet; and (iii) provides a 52 day "Exclusive Negotiation Period" during which the Debtors are prohibited from entertaining any other sale or restructuring proposals. Since Rubicon's financial problems began, the Rubicon Noteholders unanimously opposed the filing of bankruptcy cases by Rubicon and its subsidiaries. The Rubicon Noteholders did not consider a chapter 11 filing to be a viable option because (i) all the mortgages generate sufficient cash to service their debt and pay local operating expenses; (ii) collectively the mortgages generate sufficient free cash to pay Rubicon's operating expenses, (iii) a bankruptcy would be expensive and destroy value, and (iv) the fire sale liquidation value realized in bankruptcy would be less than the going-concern value that the company could obtain in an out- of-court sales process. In that regard, the Rubicon Noteholders did not enforce their remedies after the Notes went into default in September 2009 and consistently provided the company with the liquidity it required. To preserve the Debtors' going concern value, the Rubicon Noteholders are prepared to file a plan of reorganization. About Rubicon US REIT Rubicon US REIT Inc. is a Chicago-based real estate investment trust. Rubicon filed for Chapter 11 bankruptcy protection on January 20, 2010 (Bankr. D. Del. Case No. 10-10160). Attorneys at Phillips, Goldman & Spence, have been tapped as bankruptcy counsel. Phillips, Goldman & Spence, P.A. is Delaware bankruptcy counsel Grant Thornton LLP is the Company's financial advisor. Garden City Group is the claims and notice agent. In its petition, the Company listed $100,000,001 to $500,000,000 in assets and $100,000,001 to $500,000,000 in liabilities. The Company's affiliates -- Rubicon GSA II, LLC, et al. -- also filed Chapter 11 petitions. SARGENT RANCH: Court Establishes April 9 as Claims Bar Date ----------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of California has fixed April 9, 2010, as the deadline for individuals or entities to file proofs of claim against Sargent Ranch, LLC. Proofs of claim must be filed with the Clerk, U.S. Bankruptcy Court, 325 West "F" Street, San Diego, California, with a copy delivered to John L. Smaha, Esq., Smaha Law Group, APC, 7860 Mission Center Court, Suite 100, San Diego, California. La Jolla, California-based Sargent Ranch, LLC, a California Limited Liability Company, filed for Chapter 11 bankruptcy protection on January 4, 2010 (Bankr. S.D. Calif. Case No. 10- 00046). John L. Smaha, Esq., at Smaha Law Group, APC, assists the Company in its restructuring effort. The Company listed $500,000,001 to $1,000,000,000 in assets and $50,000,001 to $100,000,000 in liabilities. SCHWAB INDUSTRIES: Wants to Hire Laurence Goddard as CRO -------------------------------------------------------- Schwab Industries, Inc., et al., have asked for authorization from the U.S. Bankruptcy Court for the Northern District of Ohio to employ The Parkland Group, Inc., to provide restructuring services and designate Laurence V. Goddard as Chief Restructuring Officer, nunc pro tunc to the Petition Date. Parkland will, among other things: (a) actively manage, in consultation with the Board the restructuring efforts of Debtors; (b) assist the management with management of cash and accounts payable; (c) assist the Debtors with the collection of accounts receivable; and (d) assisting the Debtors in managing their assets, including both personal property and real property assets; Parkland will be paid based on the hourly rates of its personnel: Principals $325-$375 Directors $275-$325 Consultants $200-$275 Laurence V. Goddard, President of Parkland, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Ponte Vedra Beach, Florida-based RQB Resort, LP, aka Sawgrass Marriott Resort & Cabana Club, filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. M.D. Fla. Case No. 10-01596). The Company's affiliate -- RQB Development, LP, aka Sawgrass Marriott Golf Villas & Spa -- filed a separate Chapter 11 petition. Cynthia C. Jackson, Esq., at Smith Hulsey & Busey, assists the Company in its restructuring effort. The Company estimated its assets and debts at $100,000,001 to $500,000,000. SPA CHAKRA: Sale to Hercules Technology Approved ------------------------------------------------ Spa Chakra Inc. obtained approval from the Bankruptcy Court to sell its luxury spa business. According to Bloomberg's Bill Rochelle, U.S. Bankruptcy Judge Stuart M. Bernstein wrote a 10-page decision that while marketing efforts were "deficient" and "less than robust," he approved the sale because other bids were inhibited by the $15 million secured claim of the buyer Hercules Technology Growth Capital Inc. According to the judge, no other party was willing to compete at auction knowing that Hercules could submit a credit bid of up to $15 million with its secured claim. The report relates that Hercules will buy the business by exchanging $8 million of secured debt while assuming or paying another $4.9 million in liabilities. The Official Committee of Unsecured Creditors objected to the sale. The Creditors Committee had filed a motion converting the case to Chapter 7 liquidation. Spa Chakra, Inc., said it is proceeding towards a sale of substantially all of its assets to Hercules Technology Growth Capital. As part of the process to successfully complete the sale, Spa Chakra filed for protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 09-17260). ST LAWRENCE HOMES: Standard Pacific Acquires 110 Home Sites ----------------------------------------------------------- Amanda Jones Hoyle at Triangle Business Journal says Standard Pacific Corp. has acquired 110 home sites in the Northampton community in Wake Forest, a community formerly owned and developed by St. Lawrence Homes of Raleigh. St. Lawrence sold the property as part of its court-approved reorganization plan. The property has a tax value of more than $7 million, Ms. Jones notes. Founded in 1987, St. Lawrence Homes, Inc. -- http://www.stlh.com/ -- is a North Carolina based homebuilder with additional operations in Ohio. It claims to be recognized as one of the largest privately held builders in the country. St. Lawrence filed for Chapter 11 on February 2 (Bankr. E.D. N.C., Case No. 09-00775). The Company, in its bankruptcy petition, listed assets of $158.2 million against debt totaling $116.4 million as of October 31. STANDARD MOTOR: Narrows Net Loss to $5 Mil. in Q4 ------------------------------------------------- Standard Motor Products Inc. reported a net loss of $5.4 million for the three months ended Dec. 31, 2009, compared with a net loss of $33.6 million net loss for the same period a year ago. Net sales for the fourth quarter of 2009 were $160.1 million, compared with $148.9 million during the comparable quarter in 2008. Losses from continuing operations for the fourth quarter of 2009 were $5.2 million or 25 cents per diluted share, compared to losses of $34.1 million or $1.84 per diluted share in the fourth quarter of 2008. The Company's balance sheet at Dec. 31, 2009, showed $484.4 million total assets and $290.5 million in total liabilities. Consolidated net sales for 2009 were $735.4 million, compared to consolidated net sales of $775.2 million during the comparable period in 2008. Earnings from continuing operations for 2009 were $5.9 million or 31 cents per diluted share, compared to losses of $21.1 million or $1.14 per diluted share in the comparable period of 2008. Mr. Lawrence I. Sills, Standard Motor Products' Chairman and Chief Executive Officer, commented, "We are pleased with our results, both for the fourth quarter and the full year 2009. For the second quarter in a row, sales were ahead of the comparable quarter in 2008. "Fourth quarter 2009 sales were aided by new wire business to NAPA and new customers in Temperature Control. In addition, the aftermarket, which accounts for roughly 90% of our total sales, remains quite healthy. And while it is still early in the year, these trends appear to be continuing into 2010, as our volume through February is running ahead of 2009. "Gross margins continue to improve, as a result of increased volume and savings from our low cost Mexican operations. SG&A expenses remain under control, as a result of substantial cost cutting and the reduction of nearly 10% of our salaried work force. "Perhaps our biggest achievement in 2009 was in the area of cash flow. Over the 12 month period, we reduced our total debt by $117.8 million from $194.2 million to $76.4 million. This included the retirement of our July 2009 convertible debt obligations. Our debt to adjusted EBITDA ratio, excluding special items, went from 6.2 times to a very healthy 1.7 times. This improvement was aided by a successful equity offering in October, in which we received net proceeds of $27.5 million. All this took a tremendous effort throughout the company, and we are extremely proud of our people for what they have been able to accomplish. "In addition, based on our 2009 performance and our outlook for 2010, we reinstated our quarterly dividend that was suspended at the end of 2008. On March 1st we paid a dividend of 5 cents per share to stockholders of record on February 15th." About Standard Motor Standard Motor Products, Inc. (NYSE: SMP), headquartered in Long Island City, New York, is a manufacturer and distributor of replacement parts for the automotive aftermarket industry. The company is organized into two principal divisions: (i) Engine Management (ignition and emission parts; ignition wires; battery cables; and fuel system parts) and (ii) Temperature Control (air conditioning compressors; other air conditioning parts; and heater parts). Standard Motor's annualized revenues currently approximate $775 million. * * * As reported by the Troubled Company Reporter on July 17, 2009, Moody's Investors Service withdrew all ratings of Standard Motor Products' after the only rated debt having been redeemed upon maturity. Ratings withdrawn include the Corporate Family Rating at Caa1, and $32 million convertible subordinated debentures due July 2009 at Caa2. The last rating action occurred on June 30, 2009, when its CFR was upgraded to Caa1 from Caa2. On June 23, the TCR said Standard & Poor's Ratings Services withdrew its 'CC' corporate credit rating and other debt ratings on Standard Motor Products at the company's request. There is a small amount of rated debt remaining after the recently completed exchange offer. TEAM NATION: Posts $293,864 Net Loss in Q3 2009 ----------------------------------------------- Team Nation Holdings Corporation filed its quarterly report on Form 10-Q, showing a net loss of $293,864 on $614,919 of revenue for the three months ended September 30, 2009, compared with a net loss of $389,556 on $492,720 of revenue for the same period of 2008. The Company's balance sheet as of September 30, 2009, showed $3.2 million in assets and $4.9 million of debts, for a stockholders' deficit of $1.6 million. At September 30, 2009, the Company had negative working capital of $4.8 million, total liabilities of $4.9 million, and a stockholders' deficit of $1.6 million. Currently scheduled debt payment requirements for 2009 exceed the amount that can be expected to be generated from operations. "These conditions raise substantial doubt about the Company's ability to continue as a going concern." Additionally, the Company has approximately $3.3 million in debt which is in default. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?57a1 Newport Beach, Calif.-based Team Nation Holdings Corporation is a management and services company specializing in management solutions for title companies and title production services. TEAM NATION: Settles Lawsuit Filed Vs. Professional Business Bank ----------------------------------------------------------------- Team Nation Holdings Corporation has entered into a material agreement for settlement of a lawsuit and counter claims with Professional Business Bank ("PBB"). The agreement reached between the parties will result in dismissal of the court claims made against PBB, counterclaims made by PBB against TEAM and dismissal of the arbitration process between the parties. The Company says the lawsuit began as a set of claims made against PBB, by the Company for negligence per se, breach of fiduciary duty, breach of implied covenant of good faith and dealing, negligent interference with respect to business advantage, intentional interference with respect to business advantage, slander per se, public disclosure of private facts, violation of Business and Professional Code, and for declaratory relief. The case was filed in Orange County California Superior Court under Case No. 30-2008-00111650 on September 8, 2008. On or about October 2, 2009, PBB made counterclaims in a demand for Arbitration for Breach of Contract, Breach of Guaranty Agreements, Fraudulent Transfer and Fraudulent Obligation was made by PBB against TEAM and related parties. Under the agreement, TEAM will realize a net reduction of $1,031,842.00 from its payables, while entering into the settlement agreement. In the settlement, four officers and directors of TEAM agreed to surrender certain Certificates of Deposit held at PBB in the interest of TEAM that will be paid immediately upon performance of the actions under the Settlement Agreement. PBB agrees to provide financing that supersedes prior financing between the parties, in an amount to be $2.75 million dollars at a 5% interest rate with monthly payments of $20,000 per month, increasing by $5,000 per annum with a five year balloon payment due. This refinancing under the agreement will repay two notes, of $2,381,494.43 and $999,797.01. Personal Guaranties were executed by Dennis R. Duffy, Daniel Duffy, Janis Okerlund and Norman Francis for purposes of securing the settlement on behalf and for the benefit of TEAM. A stipulated judgment of $3,215,062.37 in favor of PBB shall be filed if any default occurs. Neither TEAM nor PBB made any concessions regarding the merits of the separate parties' claims and counterclaims in the settlement agreement. A full-text copy of the settlement agreement is available for free at http://researcharchives.com/t/s?57c4 About the Company Newport Beach, Calif.-based Team Nation Holdings Corporation is a management and services company specializing in management solutions for title companies and title production services. * * * At September 30, 2009, the Company had negative working capital of $4.8 million, total liabilities of $4.9 million, and a stockholders' deficit of $1.6 million. Currently scheduled debt payment requirements for 2009 exceed the amount that can be expected to be generated from operations. "These conditions raise substantial doubt about the Company's ability to continue as a going concern." TELANETIX INC: Earns $78,407 in Third Quarter --------------------------------------------- Telanetix, Inc. filed its quarterly report on Form 10-Q, showing net income of $78,407 on $8.1 million of revenue for the three monhts ended September 30, 2009, compared with a net loss of $619,498 on $8.5 million of revenue for the same period of 2008. The Company's balance sheet as of September 30, 2009, showed $30.5 million in assets and $36.4 million of debts, for a stockholders' deficit of $5.8 million. Mayer Hoffman McCann P.C. expressed substantial doubt about the Company's ability to continue as a going concern after auditing the Company's consolidated financial statements for the year ended December 31, 2008. The independent auditors noted that of the Company's recurring losses and net working capital deficit at December 31, 2008. This condition remains as of September 30, 2009. A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?579d Bellevue, Wash.-based Telanetix, Inc. is an IP communications company, offering a range of communications solutions from hosted IP voice and conferencing products, to text and data collaboration, to telepresence videoconferencing products. TIEGS FAMILY: U.S. Trustee Wants Reorganization Case Dismissed -------------------------------------------------------------- The U.S. Trustee for Region 19 asks the U.S. Bankruptcy Court for the District of Colorado to dismiss the Chapter 11 case of Tiegs Family Trust. The U.S. Trustee relates that the Debtor is not eligible for bankruptcy relief. The U.S. Trustee adds that the Debtor has had negligible income from the petition date on and has conducted no business activities of any kind. Colorado Springs, Colorado-based Tiegs Family Trust filed for Chapter 11 bankruptcy protection on November 23, 2009 (Bankr. D. Colo. Case No. 09-35050). According to the schedules, the Company has assets of $16,655,259, and total debts of $13,406,089. TOUSA INC: Proposes to Enter Into Remington Ranch JV Pacts ---------------------------------------------------------- Debtors Newmark Homes, L.P., and TOUSA Homes, Inc., seek the Court's authority to enter into certain agreements related to the sale of their interests in, and the unwinding of, a joint venture known as the "Remington Ranch JV" pursuant to Section 363 of the Bankruptcy Code. Remington Ranch JV, formally known as RR Houston Development, L.P., was created by RR Houston Developers, L.L.C., Newmark Homes and K. Hovnanian Homes of Houston L.P for the purpose of purchasing, developing, and selling about 450 acres of land within Remington Ranch, a master planned community located in Harris County, Texas. The Remington Ranch JV owns 556 lots within the Remington Ranch community, of which 407 lots are finished and 151 are unfinished. KB Homes Loan Star, Inc., purchased about 143 acres of the Remington Ranch lots and is developing portions of the community. In addition, RR Houston Investors, L.L.C., as general partner, together with Newmark Homes, K. Hovnanian Homes, KB Homes and J. Dickson Rogers formed a commercial partnership known as RR Houston Investment L.P. to acquire certain land within Remington Ranch. TOUSA Homes maintains a 22% membership interest in general partner RR Houston Investors and Newmark Homes maintains a 21.5% directly owned limited partnership interest in the Commercial Partnership. The Commercial Partnership owns 26 acres of land in Remington Ranch, which the Commercial Partnership is actively seeking to sell. Newmark Homes and K. Hovnanian Homes each entered into a contract with the Remington Ranch JV to buy lots within the Remington Ranch community. Through the purchases under its Contract of Sale, Newmark Homes owns seven lots within Remington Ranch. In connection with the development of Remington Ranch, the Remington Ranch JV entered into a "Joint Development and Funding Agreement" with KB Homes providing for the design and construction of certain infrastructure within the Community. The Joint Development Agreement included a cost sharing and reimbursement mechanism to both pay for the infrastructure development costs and also distribute among the Remington Ranch JV and KB Homes certain reimbursements made by the Harris County Municipal Utility District No. 96 for costs associated with infrastructure development, which costs were paid, in the first instance, by the Remington Ranch JV and KB Homes. With respect to the lots owned by KB Homes within Remington Ranch, the Remington Ranch JV, KB Homes, K. Hovnanian Homes and Newmark Homes entered into the "RR Development Right of First Refusal Agreement," whereby KB Homes granted a right of first refusal to Newmark Homes and K. Hovnanian Homes in and to the portion of land it developed. The Remington Ranch JV, KB Homes, K. Hovnanian Homes and Newmark Homes entered into the "KB Right of First Refusal Agreement," whereby the Remington Ranch JV, K. Hovnanian Homes and Newmark Homes each granted a right of first refusal in and to a property developed by the Remington Ranch JV within the Remington Ranch community. The Remington Ranch JV has access to a development loan agreement provided by Compass Bancshares, Inc., in the principal amount of $11 million. The current balance outstanding under the Lot Development Loan is about $2.2 million. Borrowings under the Lot Development Loan are secured by a deed of trust encumbering substantially all of the property owned by the Remington Ranch JV. In December 2009, KB Homes sued the Remington Ranch JV and the General Partner in the 295th Judicial District Court of Harris County, seeking payment of $1,905,724, alleged by KB Homes to have been improperly allocated by the Harris County MUD to the Remington Ranch JV in violation of the Joint Development Agreement. Paul Steven Singerman, Esq., at Berger Singerman, P.A., in Miami, Florida, relates that consistent with their wind-down strategy, the Debtors explored various possibilities that would result in a divestiture of their interests in the Remington Ranch JV. To that end, the Debtors have reached a global settlement of issues related to the Remington Ranch JV, comprised of these agreements: (1) A lot exchange under an Exchange Agreement between the Remington Ranch JV and KB Homes; (2) The sale of Newmark Homes' seven lots within Remington Ranch pursuant to the Contract of Sale between Newmark Homes and KB Homes; and (3) The sale of Newmark Homes' and TOUSA Homes' ownership interests in the Remington Ranch JV and the General Partner for $750,000 pursuant to a letter agreement between Newmark Homes, TOUSA Homes and K. Hovnanian Homes. The salient terms of the Agreements comprising the global resolution of the Remington Ranch JV issues are: A. Exchange Agreement (i) The Remington Ranch JV will convey the RR Property to KB Homes in exchange for 50 lots located at Woodcreek Reserve, City of Katy, in Fort Bend County. In addition, the Remington Ranch JV and KB Homes will exchange all of the warranties, guaranties, rights related to improvements, studies, drainage facilities, easement and utility facilities in connection with the RR Property and the KB Property. The Remington Ranch JV will also assign to KB Homes a Utility Development Agreement executed between the Remington Ranch JV and the Harris County MUD, and any and all rights under a Declaration of Covenants, Conditions and Restrictions for Remington Ranch. (ii) K. Hovnanian Homes, Newmark Homes and KB Homes agree that of the first $500,000 resulting from the sale of the Commercial Partnership property within Remington Ranch, (i) the first $100,000 will be paid by KB Homes to Newmark Homes, and (ii) the remaining $400,000 will be distributed pro rata to Newmark Homes and K. Hovnanian Homes. (iii) Pursuant to the Exchange Agreement, KB Homes will assume the unpaid principal balance of the Lot Development Loan of up to $1,991,500. At the Closing, the Remington Ranch JV will be responsible for any residual unpaid balance over the maximum amount to be assumed by KB Homes. With respect to the residual unpaid balance, Newmark Homes and K. Hovnanian Homes will each make an additional capital contribution of $150,000 to the Remington Ranch JV to cover the unpaid balance. (iv) The Remington Ranch JV and KB Homes will release each other from any and all claims arising under the Joint Development Agreement. KB Homes will dismiss the KB Homes Action against Remington Ranch JV and the General Partner. (v) The Remington Ranch JV, KB Homes, K. Hovnanian Homes and Newmark Homes will mutually release each other from the RR Right of First Refusal Agreement and the KB Homes Right of First Refusal. (vi) The Exchange Agreement provides that as a condition to Closing, Newmark Homes will have performed all of its obligations under the Purchase Agreement and the closing of the purchase and sale will occur concurrently with the exchange under the Exchange Agreement. (vii) The closing date is contemplated to occur no later than March 31, 2010. B. Purchase Agreement (i) KB Homes will acquire the seven lots owned by Newmark Homes for $70,000. (ii) The Closing of the sale is scheduled to take place Concurrently with the closing of the transactions pursuant to the Exchange Agreement and in no event later than March 31, 2010. C. Letter Agreement (i) K. Hovnanian Homes will purchase TOUSA Homes' 25% membership interest in the General Partner and Newmark Homes's 49% limited partnership interest in the Remington Ranch JV for $750,000. Newmark Homes and TOUSA Homes will execute and deliver to K. Hovnanian Homes an "Assignment of Interest." The Agreements allow the Debtors to completely unwind their position within Remington Ranch and divest all of their interests in the Remington Ranch JV, Mr. Singerman notes. The Debtors believe that the total net recovery to their estates resulting from the contemplated transactions, which total $900,000 after taking into account the contribution required by Newmark Homes with respect to the Lot Development Loan, is reasonable based on the value of the Remington Ranch JV's lots and Newmark Homes' and TOUSA Homes' share in the Remington Ranch JV and the General Partner. 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. TOUSA INC: Sets May 14 Administrative Claims Bar Date ----------------------------------------------------- TOUSA Inc. and its debtor affiliates sought and obtained a ruling from the U.S. Bankruptcy Court for the Southern District of Florida for the establishment of May 14, 2010, at 5:00 p.m., as the deadline for parties-in-interest to file proofs of claim with respect to administrative expenses for goods provided, services rendered or transactions providing a benefit to the Debtors for the period between January 29, 2008 and September 1, 2009. The Debtors believe that the successful consummation of a Chapter 11 Plan in their cases would be materially aided by establishing clear guidelines with respect to their potential liabilities, including setting an Administrative Claims Bar Date. The Debtors have thus decided, together with the Official Committee of Unsecured Creditors, to establish an Administrative Claims Bar Date with respect to the administrative claimants. The General Claims Bar Date exempted Administrative Claimants from the May 19, 2008 Bar Date, Paul Steven Singerman, Esq., at Berger Singerman, P.A., in Miami, Florida, points out. Thus, by filing the Administrative Claims Bar Date Motion, the Debtors want to clarify the current outstanding amount in Administrative Claims and obtain certainty with respect to the rights and requirements of the existing Administrative Claimants. Section 530(b) of the Bankruptcy Code provides for administrative expense treatment for "the actual, necessary costs and expenses of preserving the estate . . . for services rendered after the commencement of the case." The burden of establishing whether an expense is entitled to administrative priority falls on the claimant. All claims that are entitled to priority as an administrative expense must be paid in full on the effective date of the plan, unless the holder of the administrative claim consents to a different treatment. At the Debtors' request, the Court holds that the General Claims Bar Date Order will continue to govern the filing, form and other requirements governing each and every proof of claim submitted on account of the Administrative Claims Bar Date. The Administrative Claimants who have already filed a proof of claim against any of the Debtors, however, are not required to file a duplicate proof of claim pursuant to the Administrative Claims Bar Date. Each Administrative Claimant will be required to file an original, written proof of that Claim substantially in the form of the Proof of Administrative Claim proposed by the Debtors. All Proofs of Administrative Claim should be delivered by first- class mail, overnight delivery or hand delivery so as to be actually received on or before the Administrative Claims Bar Date by the TOUSA Claims Processing Center, c/o Kurtzman Carson Consultants, or the Clerk of the Bankruptcy Court. Proofs of Administrative Claims sent by facsimile or telecopy will not be accepted. Each Proof of Administrative Claim must: -- be written in English; -- include a claim amount denominated in U.S. dollars; -- state a claim against only one Debtor; -- clearly indicate the Debtors against which the creditor is asserting a claim; -- be signed by the Administrative Claimant, or if the Administrative Claimant is not an individual, by an authorized agent of the Administrative Claimant; and -- include supporting documentation or an explanation as to why documentation is not available. The Debtors will mail the Administrative Claims Bar Date Notice to the applicable parties on or before March 15, 2010. Moreover, the Debtors will give notice of the Administrative Claims Bar Date by the publication notice on or before March 15, 2010, to creditors for whom notice by mail is impracticable, including creditors whose identities are known but whose addresses are unknown by the Debtors pursuant to Rule 2002(l) of the Federal Rules of Bankruptcy Procedure. The Debtors will specifically publish the Administrative Claims Bar Date notice in the Wall Street Journal and in local newspapers identified by the Debtors. For the avoidance of doubt, the General Claims Bar Date remains in full force and effect, the Court clarifies. 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. TOUSA INC: Sets May 14 Customer Claims Bar Date ----------------------------------------------- TOUSA Inc. and its units sought and obtained a Court order establishing May 14, 2010, at 5:00 p.m., as the supplemental bar date with respect to: -- each Claim of a customer arising from or related to a signed agreement to purchase a home from, or a home closed with, the Debtors before January 29, 2008; and -- each Claim of a customer arising from or related to a signed agreement to purchase a home from, or a home closed with, the Debtors after January 29, 2008, to the extent the Debtors have not paid or honored that Claim during their Chapter 11 cases. Paul Steven Singerman, Esq., at Berger Singerman, P.A., in Miami, Florida, relates that the General Claims Bar Date Order entered by the Court on March 17, 2008 exempted Customer Claimants from the Bar Date. Specifically, claims of any customer who has signed a contract or has closed on a home with the Debtors to the extent that the Debtors were authorized by the Court to honor those claims were not required to file a proof of claim by the May 19, 2008 General Claims Bar Date. The Debtors thus sought the establishment of a Customer Claims Bar Date, with the intent of ensuring a fair opportunity for Customer Claimants to submit a proof of claim that will be evaluated for allowance and distribution purposes. The Customer Claims Bar Date will not apply to claimants whose claims were not subject to the Prepetition Customer Claim Carve- Out and are currently barred from filing their claims by the Bar Date. Specifically, as provided by the Original Bar Date Order, those claimants whose claims related to (i) a known warranty claim or other obligation that the Debtors had contested at the time of the Original Bar Date, or (ii) damages arising from claims for breach of contract, breach of warranty or misrepresentation or any other litigation or pre-litigation claim, were indeed subject to the original Bar Date and had to file their proof of claim by the Original Bar Date. In addition, Customer Claimants who already filed a proof of claim by the Original Bar Date are not required to file a duplicate proof of claim pursuant to the Customer Claims Bar Date. At the Debtors' behest, the Court ruled that the General Claims Bar Date continue to govern the filing, form and other requirements governing each and every proof of claim submitted on account of the Customer Claims Bar Date. All Customer Proofs of Claim should be delivered by first class mail, overnight delivery or hand delivery so as to be actually received on or before the Customer Claims Bar Date by the Debtors' claims agent or the Clerk of the Court. Each Customer Proof of Claim must be written in English, include a claim amount denominated in U.S. dollars, state a claim against only one Debtor, clearly indicate the Debtor against which the creditor is asserting a claim, and include supporting documentation. The Debtors will serve a Customer Claims Bar Date Notice on or before March 15, 2010, on the applicable parties-in-interest. In addition, the Debtors will provide notice of the Customer Claims Bar Date on or before March 15, 2010, as provided under Rule 2002(l) of the Federal Rules of Bankruptcy Procedure, to creditors to whom notice by mail is impracticable, including creditors whose identities are known but whose addresses are unknown by the Debtors. 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. TOUSA INC: Starwood Completes Purchase of Florida Lots ------------------------------------------------------ Starwood Land Ventures LLC finalized its acquisition of 5,499 residential lots from TOUSA, Inc., in late February 2010, Dow Jones Newswires reports. As previously reported, Starwood emerged as the successful bidder for the TOUSA Assets at a January 22, 2010 auction, with an improved bid of $81 million for 5,499 of TOUSA's unstarted lots and 36 model homes in the Florida Region. The United States Bankruptcy Court for the Southern District of Florida approved the sale on January 29, 2010. Subsequently, Lennar Corporation and Starwood entered into a deal in late February, whereby Lennar closed a deal to acquire or be entitled to an option to acquire from Starwood more than 2,700 homesites in 38 communities across Florida. The homesites were part of TOUSA's Florida assets that Starwood acquired in late January 2010. 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. TUSCAWILLA HILLS: Case Summary & 12 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Tuscawilla Hills Development, Inc. 635 NW 13th Street, Suite C Gainesville, FL 32601 Bankruptcy Case No.: 10-10106 Chapter 11 Petition Date: March 8, 2010 Court: United States Bankruptcy Court Northern District of Florida (Gainesville) Debtor's Counsel: Sharon T. Sperling, Esq. Law Office of Sharon T. Sperling P.O. Box 358000 Gainesville, FL 32635-8000 Tel: (352) 371-3117 Fax: (352) 377-6324 Email: sharon@sharonsperling.com Estimated Assets: $1,000,001 to $10,000,000 Estimated Debts: $500,001 to $1,000,000 According to the schedules, the Company has assets of $1,406,203, and total debts of $553,476. A full-text copy of the Debtor's petition, including a list of its 12 largest unsecured creditors, is available for free at: http://bankrupt.com/misc/flnb10-10106.pdf The petition was signed by Wiley D. Wood, president of the Company. TREY RESOURCES: Posts $325,402 Net Loss in Q3 2009 -------------------------------------------------- Trey Resources, Inc. filed its quarterly report on Form 10-Q, showing a net loss of $325,402 on $1.9 million of revenue for the three months ended September 30, 2009, compared with a net loss of $126,110 on $1.8 million of revenue for the same period of 2008. The Company's balance sheet as of September 30, 2009, showed $1.2 million in assets and $5.6 million of debts, for a stockholders' deficit of $4.5 million. The Company has suffered recurring operating losses and current liabilities exceeded current assets by approximately $4.7 million, as of September 30, 2009. "These matters raise substantial doubt about the Company's ability to continue as a going concern." A full-text copy of the quarterly report is available for free at: http://researcharchives.com/t/s?4b0c Livingston, N.J.-based Trey Resources, Inc. operates as a business consultant, and value-added reseller and developer of financial accounting software in the United States. TRUMP ENTERTAINMENT: Aims on Shutting Off Payments to Lenders ------------------------------------------------------------- Bill Rochelle at Bloomberg News reports that at the ongoing plan confirmation hearings, Trump Entertainment Resorts Inc., and the first-lien lenders proposing the competing plan agreed that the company is worth less than the senior secured debt. As a result, the Company filed a motion asking the Bankruptcy Court to recharacterize some of the $52.1 million in payments made to the lenders during the course of the case. According to the report, Trump Entertainment asserts that the lenders weren't entitled to payments of interest, principal and fees given that the collateral is now indisputably worth less than the debt. Trump Entertainment made the payments as adequate protection to lenders for any diminution in value of their collateral. Trump wants $45.8 million in previous payments recharacterized as reductions of principal so the loan balance would be reduced to $443 million. The Company also wants an order allowing it to stop payments to the lenders for the duration of the case. The contested confirmation hearing to determine who will end up owning Trump Entertainment's casinos began February 23. The company and holders of 8.5% senior notes are proponents of one plan. Carl Icahn and Beal Bank, holders of prepetition secured claims, are proponents of the other. Under the plan proposed by the Beal Bank and Icahn Partners, dated January 5, 2010, second lien lenders owed $1.25 billion and general unsecured claim, who are out-of-the money would conditionally receive a $14 million cash as "gift" from the secured lenders. Under the plan, majority of the first lien debt will be converted to 62.971% of the equity in the reorganized Debtors. The remaining 33.326% will be available for sale to second lien noteholders in a $225 million rights offering. Mr. Icahn has bought 51% of Beal's $485 million first lien secured claim and holds $154.9 million of the second lien claims. Mr. Icahn already has an existing controlling stake in the Tropicana Atlantic City Hotel & Casino, one of the Debtors' largest competitors. Under the plan proposed by the Ad hoc committee of holders of second lien notes, the noteholders and unsecured creditors will recover just under 1% in the form of stock (5% of the stock of the reorganized Debtor is allocated for distribution) or in cash. They would also have rights to acquire 70% of the new common stock. The second lien noteholders committee is backstopping the $225 million rights offering. Secured lenders and Mr. Icahn will be paid in full by paying Mr. Icahn $125 million in rights offering proceeds, 100% of net sale proceeds from any sale of the Trump Marina and new debt. Mr. Trump and the bondholders have offered to put up $225 million in fresh cash and new loans. Mr. Icahn and Beal Bank are ready to provide $488 million in secured loans. A full-text copy of the disclosure statement explaining Beal & Icahn's plan is available for free at: http://bankrupt.com/misc/TrumpEntertainment_5thABealDS.pdf A full-text copy of the disclosure statement explaining the Noteholders' and Debtors' plan is available for free at: http://bankrupt.com/misc/Trump_6thANoteholdersDS.pdf About Trump Entertainment Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the Company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC, and other affiliates filed for Chapter 11 on February 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. Garden City Group is the claims agent. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of December 31, 2008. Trump Hotels & Casino Resorts, Inc., filed for Chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No. 04-46898 through 04-46925). Trump Hotels' obtained the Court's TRUMP ENTERTAINMENT: Icahn's Adviser Lambasts Restructuring Plan ---------------------------------------------------------------- Donald Wittkowski, staff writer at Press of Atlantic City, reports that Carl Icahn's financial adviser, Neil Augustine, said the restructuring plan of Trump Entertainment Resorts Inc. is unrealistic and fatally flawed. According to Mr. Augustine, Trump's management team ignored the negative impact that new table games at the rival Pennsylvania casinos will have on the Atlantic City gaming company's revenue and profits. The Company will hurt itself even more by slashing $52.6 million of capital spending for upgrades that are critical for attracting customers to the aging Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino and Trump Marina Hotel Casino. About Trump Entertainment Resorts Based in Atlantic City, New Jersey, Trump Entertainment Resorts Inc. (NASDAQ: TRMP) -- http://www.trumpcasinos.com/-- owns and operates three casino hotel properties in Atlantic City, New Jersey, which include Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino, and Trump Marina Hotel Casino. The Company conducts gaming activities and provides customers with casino resort and entertainment. Donald Trump is a shareholder of the Company and, as its non- executive Chairman, is not involved in the daily operations of the Company. The Company is separate and distinct from Mr. Trump's privately held real estate and other holdings. Trump Entertainment Resorts, TCI 2 Holdings, LLC, and other affiliates filed for Chapter 11 on February 17, 2009 (Bankr. D. N.J., Lead Case No. 09-13654). The Company has tapped Charles A. Stanziale, Jr., Esq., at McCarter & English, LLP, as lead counsel, and Weil Gotshal & Manges as co-counsel. Ernst & Young LLP is the Company's auditor and accountant and Lazard Freres & Co. LLC is the financial advisor. Garden City Group is the claims agent. The Company disclosed assets of $2,055,555,000 and debts of $1,737,726,000 as of December 31, 2008. Trump Hotels & Casino Resorts, Inc., filed for Chapter 11 protection on Nov. 21, 2004 (Bankr. D. N.J. Case No. 04-46898 through 04-46925). Trump Hotels' obtained the Court's confirmation of its Chapter 11 plan on April 5, 2005, and in May 2005, it exited from bankruptcy under the name Trump Entertainment Resorts Inc. U.S. DRY CLEANING: Files for Bankruptcy Due to Capital Woes ----------------------------------------------------------- U.S. Dry Cleaning Services and seven wholly owned subsidiaries filed for Chapter 11 protection on March 4 (Bankr. C.D. Calif. Case No. 10-12748). Garrick A. Hollander, Esq., at Winthrop Couchot, represents the Company in its restructuring effort. The petition says that assets are under $10 million while debts are between $10 million and $50 millin. Headquartered in Palm Springs, California, U.S. Dry Cleaning Corporation (OTC BB: UDRY) -- http://www.usdrycleaning.com/-- operates in the laundry and dry cleaning business and is geographically concentrated in Hawaii and Southern California. According to a corporate release, "The decision to pursue reorganization under Chapter 11 came after extensive efforts to refinance or extend maturing debt outside of Chapter 11. Over many months, the Company has searched for capital, and endeavored to negotiate with its unsecured and secured creditors to obtain the time needed to develop a long-term solution to the small business credit crisis facing the Company. Unable to reach an out-of-court consensus, the Company reluctantly concluded that restructuring under the protection of the bankruptcy court was necessary. During the Chapter 11 cases the Company will continue to explore strategic alternatives and search the markets for available sources of capital." US FIDELIS: DIP Financing & Cash Collateral Use Get Interim OK --------------------------------------------------------------- US Fidelis, Inc., sought and obtained interim approval from the Hon. Charles E. Rendlen, III, of the U.S. Bankruptcy Court for the Eastern District of Missouri to obtain postpetition secured financing from Mepco Finance Corporation, and use cash collateral. The DIP lenders have committed to provide up to $3,000,000. The Debtor will borrow up to an aggregate of $788,000, pending the final hearing. Robert E. Eggmann, Esq., and Crystanna V. Cox, Esq., at Lathrop & Gage LLP, the attorneys for the Debtor, explained that the Debtor needs the money to fund its Chapter 11 case, pay suppliers and other parties. The DIP facility will mature on June 30, 2010. As security for Debtor's obligations under the credit agreement, The Lender is granted valid, perfected and continuing, replacement security interests in and liens on present and after-acquired property of the Debtor. Mr. Eggmann and Ms. Cox said that the Debtor will also use the cash collateral to provide additional liquidity. The Debtor will use the collateral pursuant to a budget, a copy of which is available for free at: http://bankrupt.com/misc/US_FIDELIS_budget.pdf The Court has set a final hearing for March 31, 2010 at 10:00 a.m., Central Time, on the Debtor's request to obtain DIP financing. Wentzville, Missouri-based US Fidelis, Inc., is a marketer of vehicle service contracts developed by independent and unrelated companies. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. E.D. Mo. Case No. 10-41902). Robert E. Eggmann, Esq., at Lathrop & Gage, assists the Company in its restructuring effort. According to the schedules, the Company has assets of $74,386,836, and total debts of $25,770,655. US FIDELIS: Taps Scott Eisenberg as Chief Restructuring Officer --------------------------------------------------------------- US Fidelis, Inc., has asked for authorization from the U.S. Bankruptcy Court for the Eastern District of Missouri to employ Amherst Partners, LLC, as financial consultant, and the firm's Scott Eisenberg as Chief Restructuring Officer. Mr. Eisenberg will, among other things: (a) direct financial functions and related employees of the Debtor; (b) oversee the Debtor's operations; (c) assist the Debtor in meeting with its lender(s) and presenting the revised financial plan and of maintaining their support; and (d) file a petition for Chapter 11 in the Eastern District of Missouri. Amherst Partners will be paid $300 to $350 per hour for its services. Scott Eisenberg, a member at Amherst Partners, assures the Court that the firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Wentzville, Missouri-based US Fidelis, Inc., is a marketer of vehicle service contracts developed by independent and unrelated companies. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. E.D. Mo. Case No. 10-41902). Robert E. Eggmann, Esq., at Lathrop & Gage, assists the Company in its restructuring effort. According to the schedules, the Company has assets of $74,386,836, and total debts of $25,770,655. US FIDELIS: Wants to Hire Lathrop & Gage as Bankruptcy Counsel -------------------------------------------------------------- US Fidelis, Inc., has sought permission from the U.S. Bankruptcy Court for the Eastern District of Missouri to employ Lathrop & Gage LLP as bankruptcy counsel. Lathrop & Gage will, among other things: a. assist and advise the Debtor in its consultations with any appointed committee relative to the administration of this case; b. assist the Debtor in analyzing the claims of creditors and negotiate with the creditors; c. assist the Debtor with investigation of the assets, liabilities and financial condition of the Debtor and reorganizing the Debtor's businesses in order to maximize the value of the Debtor's assets for the benefit of creditors; and e. advise the Debtor in connection with the sale of assets or business. Robert E. Eggmann, a partner in Lathrop & Gage, says that the firm will be paid based on the hourly rates of its personnel: Attorneys $175-$500 Legal Assistants $105 Mr. Eggman assures the Court that Lathrop & Gage is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. Wentzville, Missouri-based US Fidelis, Inc., is a marketer of vehicle service contracts developed by independent and unrelated companies. The Company filed for Chapter 11 bankruptcy protection on March 1, 2010 (Bankr. E.D. Mo. Case No. 10-41902). According to the schedules, the Company has assets of $74,386,836, and total debts of $25,770,655. VAUGHAN CO: To Create New Seven-Member Board of Directors --------------------------------------------------------- According to Business Weekly of New Mexico, Vaughan Co. Realtors is creating a new seven board of directors including three investors recruited by former chief executive officer Doug Vaughan. The new board members include Michael Dreskin, interim CEO, president Jim Salazar, and Michael Arruti, a qualifying broker. Report notes that Mr. Vaughan will continue to be on the board. Based in Albuquerque, New Mexico, The Vaughan Company Realtors filed for Chapter 11 protection on Feb. 22, 2010 (Bankr. N.M. Case No. 10-10759). George D. Giddens, Jr., Esq., represents the Debtor in its restructuring efforts. The company listed both assets and debts of between $1 million and $10 million. VIANT HOLDINGS: Moody's Retains 'B2' Corporate Family Rating ------------------------------------------------------------ Moody's commented that there are no changes to any of Viant's or Multiplan's ratings following the announcement that Multiplan had been granted early termination of the Hart-Scott-Rodino waiting period and will proceed with the acquisition of Viant. The last rating action on Viant and Multiplan was December 15, 2009, when Moody's affirmed Multiplan's and Viant's B2 Corporate Family Ratings and rated the financing of the proposed transaction. Viant Holdings, Inc. is a leading national provider of outsourced cost management services to the managed care industry. Viant offers a broad array of services that are designed to decrease medical and administrative costs for its customers. Founded in 1990, Viant currently serves over 650 customers, including large national and regional managed care companies, third party administrators, Taft-Hartley sponsored plans and government agencies such as the Centers for Medicare and Medicaid Services. Viant's primary service offerings include Preferred Provider Organization network services, non-network services and post- payment audit services. In 2008, Viant processed approximately 22 million medical bills totaling over $50 billion in billed charges and achieved gross customer savings of approximately $25 billion. Multiplan Inc., based in New York, New York, operates principally in the health care benefits field as a PPO, providing health care cost management via contract arrangements between health care providers and insurance carriers, HMO's, third party administrators and Taft-Hartley benefit funds throughout the United States. Fees are generated from discounts provided for payers that access the company's network. Multiplan's network includes 5,000 acute care hospitals, 625,000 practitioners and 115,000 ancillary facilities nationally. VIKING SYSTEMS: Registers 15 Mil. Shares for Resale --------------------------------------------------- Viking Systems, Inc., filed with the Securities and Exchange Commission a prospectus relating to the offer and resale of up to 15,000,000 shares of Viking common stock, par value $0.001 per share, by selling stockholder, Dutchess Opportunity Fund, II. Dutchess has agreed to purchase the shares pursuant to an investment agreement the parties entered into on January 5, 2010. Viking has the right to "put," or sell, up to $5.0 million in shares of its common stock to Dutchess. Viking will not receive any proceeds from the resale of the shares of common stock offered by Dutchess. Viking will, however, receive proceeds from the sale of shares to Dutchess pursuant to the Equity Line. "When we put an amount of shares to Dutchess, the per share purchase price that Dutchess will pay to us in respect of such put will be determined in accordance with a formula set forth in the Investment Agreement. Generally, in respect of each put, Dutchess will pay us a per share purchase price equal to 96% of the volume weighted average price, or "VWAP," of our common stock during the five consecutive trading day period beginning on the trading day immediately following the date Dutchess receives our put notice," Viking explains. Dutchess may sell the shares of common stock from time to time at the prevailing market price on the Over-the-Counter Bulletin Board, or OTCBB, or on an exchange if Viking's shares become listed for trading on such an exchange, or in negotiated transactions. Dutchess is an "underwriter" within the meaning of the Securities Act of 1933, as amended, in connection with the resale of our common stock under the Equity Line. Viking's common stock is quoted on the OTCBB under the symbol "VKNG.OB". A full-text copy of the prospectus is available at no charge at http://ResearchArchives.com/t/s?5810 The report from Viking Systems, Inc.'s independent registered public accounting firm, Squar, Milner, Peterson, Miranda & Williamson, LLP, dated February 22, 2010, includes a going concern explanatory paragraph which states that factors relating to the Company's net losses and working capital concerns raise substantial doubt the Company's ability to continue as a going concern. Viking Systems said it will need to generate significant additional revenue to achieve profitability and it may require additional financing during 2010. "The going concern explanatory paragraph in the independent auditor's report emphasizes the uncertainty related to our business as well as the level of risk associated with an investment in our common stock," Viking Systems said. The Company reported a net loss applicable to common shareholders of $1,074,319 for fiscal year 2009 from a net loss of $5,752,057 for 2008. At December 31, 2009, the Company had total assets of $2,952,664 against total liabilities, all current, of $2,048,970. At December 31, 2009, the Company had an accumulated deficit of $26,297,978 and stockholders' equity of $903,694. At December 31, 2008, stockholders' equity was $1,385,663. About Viking Systems Based in Westborough, Massachusetts, Viking Systems, Inc. (OTCBB: VKNG.OB) -- http://www.vikingsystems.com/-- is a developer, manufacturer and marketer of visualization solutions for complex minimally invasive surgery. The Company partners with medical device companies and healthcare facilities to provide surgeons with proprietary visualization systems enabling minimally invasive surgical procedures, which reduce patient trauma and recovery time. VISTEON CORP: Autoliv Acquires Radar Systems Business ----------------------------------------------------- Autoliv Inc. (NYSE: ALV) said in a statement that it has acquired Visteon's radar system business. This acquisition in Active Safety Systems follows upon the Company's 2008 acquisition of the leading automotive radar business from Tyco Electronics. "While this acquisition is small, with less than $5 million in sales and five highly skilled engineers, it fits very well our own existing radar business," said the Autoliv CEO Jan Carlson. "Our radar specialists have worked together with the Visteon team over the past few years. This partnership has resulted in industry-leading Blind Spot and Rear Cross Traffic Detection Systems that are currently in production at multiple OEM customers." "The acquisition not only ensures that this productive cooperation continues, it also gives us opportunities to further strengthen our position in Active Safety Systems." Autoliv offers a broad range of Active Safety functions based on high performance Radar, Night Vision and Mono/Stereo Vision Systems. "We have the technologies in a market that many predict is about to take off," explained Jan Carlson. "The Visteon transaction includes physical assets, intellectual property, order book and engineers with expertise in radar-based Driver Assistance and Active Safety functions. About Autoliv Autoliv Inc., the worldwide leader in automotive safety systems, develops and manufactures automotive safety systems for all major automotive manufacturers in the world. Together with its joint ventures, Autoliv has 80 facilities with approximately 38,000 employees in 29 vehicle-producing countries. In addition, the Company has technical centers in ten countries around the world, with 21 test tracks, more than any other automotive safety supplier. Sales in 2009 amounted to US $5.1 billion. The Company's shares are listed on the New York Stock Exchange (NYSE: ALV) and its Swedish Depository Receipts on the OMX Nordic Exchange in Stockholm (ALIV sdb). About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of $4,561,000,000 and debts of $5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Calsonic Kansei Settlement Approved by Court ---------------------------------------------------------- Visteon Corporation, VC Regional Assembly & Manufacturing, LLC, and GCM Visteon Automotive Systems, LLC, obtained the Court's authority to enter into a settlement agreement with Calsonic Kansei North America, which resolves claims between the parties and facilitates the transition of certain Visteon plants to a third party. The Settlement Agreement also resolves Calsonic Kansei's adversary complaint it initiated against the Debtors. Pursuant to the Settlement Agreement, (i) Calsonic Kansei will be allowed to execute certain setoffs, (ii) the Debtors will make a payment to Calsonic Kansei to resolve the balance of Calsonic Kansei's claim pursuant to Section 503(b)(9), and (iii) Calsonic Kansei will cooperate with the Debtors regarding tooling and other matters necessary for the Debtors to fulfill their obligations to their customers. Calsonic Kansei filed, on June 19, 2009, an Adversary Proceeding, alleging that the Debtors owed it a total of $2,249,000 for shipment of goods delivered to the Debtors prior to the Petition Date. Of this amount, Calsonic Kansei claimed that $622,781 was an administrative priority claim. The Adversary Proceeding also sought authority to setoff Calsonic Kansei claim against amounts that Calsonic Kansei owed to the Debtors for parts delivered by the Debtors to Calsonic Kansei before the Petition Date amounting to $552,725. The parties' Settlement Agreement contemplates these setoff and payment: (a) Calsonic Kansei will execute a setoff pursuant to Section 553 of the Bankruptcy Code in the amount of (i) $303,995 of the Visteon Claim against the general unsecured portion of the Calsonic Kansei claim; and (ii) $248,730 of the Visteon Claim against the Section 503(b)(9) portion of the Calsonic Kansei Claim, in full satisfaction of the Visteon Claim. (b) The Debtors will pay the remaining $374,541 of the Calsonic Kansei 503(b)(9) claim. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of $4,561,000,000 and debts of $5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Closing of North Penn Facility Approved ----------------------------------------------------- Visteon Corp. and its units obtained the Court's authority to enter into a closure agreement with the International Union United Automobile, Aerospace and Agricultural Implement Workers of America and Local Union 1695 in connection with the closing of their North Penn plant located in Lansdale, Pennsylvania. Prior to the Petition Date, the Debtors executed an aggressive restructuring initiative to eliminate many of their non-core or underperforming facilities, improve their engineering and manufacturing competitiveness, and seek a sustainable and competitive cost structure, says Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware. Consistent with this strategy, the Debtors entered into an accommodation agreement with Ford Motor Company to govern, among other things, the wind-down of the North Penn Plant. The closure of the North Penn Plant will effectuate the accommodation agreement approved by the Court and further the progress already made towards transforming the Debtors' operational footprint, Mr. Billion avers. The terms of the Closure Agreement include (1) the termination of the North Penn CBA, and (2) the Debtors' provision of benefit payments to active employees: A. North Penn CBA Termination The North Penn CBA will expire upon the cessation of operations at the North Penn Plant on February 28, 2010, instead of the current expiration date of March 13, 2010. The North Penn CBA is that certain agreement entered into by Visteon Systems LLC and UAW, dated April 2, 2005, as amended by the North Penn Manufacturing Operations Extension Agreement, dated October 13, 2008. Under the North Penn CBA, the Debtors are obligated to provide unionized employees with, among other things: (a) one to five weeks of vacation time; (b) paid holiday time; (c) certain performance bonus awards; (d) cost-of-living adjustments; and (e) certain post-employment health care benefits to hourly employees represented by the UAW. The obligations of the Debtors under the North Penn CBA will cease once the agreement expires and the Debtors' obligations with respect to the North Penn Plant's union employees will be limited to those obligations specified in the Closure Agreement. B. Payment of Benefits to Active Employees The Closure Agreement requires the Debtors to provide certain severance and other benefit payments to active employees, none of whom are insiders, as well as health care coverage to active employees for a period of four months after the expiration of the North Penn CBA -- the costs for which are much less than the Debtors' current obligations under the North Penn CBA. Specifically, the Closure Agreement obligates the Debtors to provide: * a one time severance payment to all active employees; * a $2,000 performance bonus to all active employees for their efforts in effectuating the plant wind-down and closure; * payment of a health care welfare bonus of $1,000 and four months of health care benefits for active employees beyond the expiration of the North Penn CBA; * payment on account of all active employees' unused vacation allowance; * three months' notice of changes to post-employment medical benefits for those who retired under the North Penn CBA and current active employees that are retirement eligible; and * an agreement not to contest unemployment claims filed by employees resulting from the plant closure. A full-text copy of the Closure Agreement is available for free at http://bankrupt.com/misc/Visteon_NorthClosureAgmt.pdf Furthermore, pursuant to the Court-approved Ford Accommodation Agreement, Ford has agreed to reimburse the Debtors for the vast majority of the costs under the Closure Agreement. The Debtors assert that the Closure Agreement allows them to exit the North Penn Plant in the most efficient manner possible; resolves any disputed or unresolved issues under the North Penn CBA; and provides for reduced labor costs. The Debtors aver that the Closure Agreement will generate savings as a result of the discontinuation of post-employment health care benefits for retirees that were governed by the North Penn CBA based on its accelerated expiration date. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of $4,561,000,000 and debts of $5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VISTEON CORP: Wins Approval to Sell AAC JV Assets for $3.1MM ------------------------------------------------------------ Visteon Corp. and its units obtained the Court's authority to enter into a sale agreement with JVIC Manufacturing LLC and a member payment agreement with VIC Management LLC. The Debtors intend to exit their interiors line of business in the United States. In connection with the resourcing of certain of the Debtors' interior component production under certain accommodation agreements, certain of the Debtors' customers have indicated their intent to resource the production of interiors components by Atlantic Automotive Components, LLC -- a 70/30 joint venture between Visteon Corporation and VIC Management LLC, an affiliate of Mayco International, LLC. As an alternative to liquidating the Atlantic Automotive JV prior to or in connection with the planned resourcing, the Debtors have agreed to pursue the sale of their interest in the Atlantic Automotive JV to JVIC Manufacturing LLC, as purchaser. JVIC is also an affiliate of Mayco International. Accordingly, pursuant to a purchase and sale agreement dated January 28, 2010, Visteon Corp., Atlantic Automotive JV and JVIS Manufacturing intend to enter into these contemplated transactions: -- JVIS Manufacturing will purchase substantially all assets of Atlantic Automotive JV for $3.1 million; -- JVIS Manufacturing will assume substantially all of the liabilities of Atlantic Automotive JV; -- To facilitate the sale transition, the Debtors will assign certain contracts to JVIS Manufacturing as well as provide certain transition services and sourcing of certain parts, previously sourced to Atlantic Automotive JV, to JVIS Manufacturing; -- A $50,000 payment in exchange for the Debtors' assignment to JVIS Manufacturing of certain purchase orders and supply contracts entered into by Visteon Corp. related to the Atlantic Automotive JV production; -- A release from all obligations to the Atlantic Automotive JV related to accounts payable for goods delivered or services provided prior to the Petition Date, which obligations are estimated to equal about $3.9 million; -- Reimbursement of certain transition services to be provided to JVIS Manufacturing upon the request of JVIS; -- The resourcing of certain Atlantic Automotive JV business to a Visteon facility in Mexico. A full-text copy of the Sale Agreement is available for free at: http://bankrupt.com/misc/Visteon_JVISSaleAgmt.pdf The Member Payment Agreement The Debtors also seek to enter into a Member Payment Agreement with VIC Management, the other member of the Atlantic Automotive JV. The Member Payment Agreement accomplishes the second step in the Debtors' exit from Atlantic Automotive JV, which is the distribution of the remainder of Atlantic Automotive assets. The salient terms of the Member Payment Agreement are: -- The Debtors will receive equipment with an estimated liquidation value of approximately $700,000 to $900,000 and cash in the amount of $2.95 million in satisfaction of the Atlantic Automotive Loans, which total $14 million; and -- VIC Management would receive $150,000 in cash in satisfaction of certain loans to Atlantic Automotive JV. Assumption & Assignment Procedures Moreover, the Debtors believe that it is necessary to establish an orderly and fair process (i) by which cure amounts related to the assignment of executory contracts related to the Atlantic Automotive JV business can be established, and (ii) by which contract counterparties can request additional information regarding adequate assurance of future performance. The Debtors thus propose these Assignment Procedures: (a) The Debtors are to serve, by February 1, 2010, a Cure Notice to each of the counterparties to a Transferred Visteon Executory Contract, notifying each Contract Counterparty of the Debtors' intent to assume and assign the applicable Transferred Visteon Executory Contracts and of the aggregate Cure Amount the Debtors believe is necessary to be paid to that Contract Counterparty in connection with that assumption and assignment. (b) Any Contract Counterparty seeking to (i) assert a Cure Amount based on defaults, conditions, or pecuniary losses under a Transferred Visteon Executory Contract different from that set forth on the Applicable Cure Notice, or (ii) object to the potential assumption and assignment on any other grounds, will be required to file and serve a written objection. (c) To be considered timely, a Cure Objection must be filed with the Bankruptcy Court no later than February 11, 2010. (d) If a Contract Counterparty timely files a Cure Objection alleging a Cure Amount other than the amount set forth on the Cure Notice, the relevant Transferred Visteon Executory Contracts will nevertheless be assumed and assigned to the Purchaser on the Closing Date, the Debtors will pay the undisputed portion of the Cure Amount on or as soon as reasonably practicable after the Closing Date, and the disputed portion of the Cure Amount will be determined and paid as reasonably practicable by the Debtors following resolution of that disputed Cure Amount. (e) Unless a Cure Objection opposing the assumption and assignment of a Transferred Visteon Executory Contract on a basis other than the proposed Cure Amount is timely filed by the Cure Objection Deadline, the Bankruptcy Court will enter an order authorizing or effecting the assumption and assignment of the applicable Transferred Visteon Executory Contract at the omnibus hearing scheduled for February 18, 2010. (f) Contract Counterparties that fail to file Cure Objections will be deemed to have waived and released any and all cure obligations, and will be forever barred and estopped from asserting or claiming against the Debtors, the Purchaser, or any other assignee of the relevant Transferred Visteon Executory Contract that any additional amounts are due or defaults exist, or prohibitions or conditions to assignment exist or must be satisfied, under that Transferred Visteon Executory Contract for the period prior to the assumption and assignment of that Transferred Visteon Executory Contract. About Visteon Corp. Headquartered in Van Buren Township, Michigan, Visteon Corporation (NYSE: VC) -- http://www.visteon.com/-- is a global automotive supplier that designs, engineers and manufactures innovative climate, interior, electronic and lighting products for vehicle manufacturers, and also provides a range of products and services to aftermarket customers. The company has corporate offices in Van Buren Township, Michigan (U.S.); Shanghai, China; and Kerpen, Germany. It has facilities in 27 countries and employs roughly 35,500 people. The Company has assets of $4,561,000,000 and debts of $5,311,000,000 as of March 31, 2009. Visteon Corporation and 30 of its affiliates filed for Chapter 11 protection on May 28, 2009, (Bank. D. Del. Case No. 09-11786 through 09-11818). Judge Christopher S. Sontchi oversees the Chapter 11 cases. James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., and James J. Mazza, Jr., Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, represent the Debtors in their restructuring efforts. Laura Davis Jones, Esq., James E. O'Neill, Esq., Timothy P. Cairns, Esq., and Mark M. Billion, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, serve as the Debtors' local counsel. The Debtors' investment banker and financial advisor is Rothschild Inc. The Debtors' notice, claims, and solicitation agent is Kurtzman Carson Consultants LLC. The Debtors' restructuring advisor is Alvarez & Marsal North America, LLC. Bankruptcy Creditors' Service, Inc., publishes Visteon Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Visteon Corp. and its debtor-affiliates. (http://bankrupt.com/newsstand/ or 215/945-7000) VULCAN ADVANCED: Organizational Meeting to Form Panel March 22 -------------------------------------------------------------- Roberta A. DeAngelis, Acting United States Trustee for Region 3, will hold an organizational meeting on March 22, 2009, at 1:30 p.m. in the bankruptcy case of Vulcan Advanced Mobile Power Systems, L.L.C. The meeting will be held at J. Caleb Boggs Federal Building, 844 King Street, Room 2112, Wilmington, DE 19801. The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' cases. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. New York-based Vulcan Advanced Mobile Power Systems, L.L.C., filed for Chapter 11 bankruptcy protection on February 12, 2010 (Bankr. D. Delaware Case No. 10-10442). William David Sullivan, Esq., at Sullivan Hazeltine Allinson LLC, assists the Company in its restructuring effort. The Company listed $1,000,001 to $10,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. WASHINGTON MUTUAL: Court Approves Settlement With Media Vendors --------------------------------------------------------------- The Bankruptcy Court approved the settlement agreement between Washington Mutual, Inc., and its advertising agent TBWA Worldwide Inc., doing business as TBWA\Chiat\Day, to resolve claims of certain media vendors pursuant to an Advertising Agency Agreement dated October 17, 2007. The Media Vendors consist of Cox Radio Houston, Cox Radio Inc., The Tampa Tribune, Antelope Valley Press, BRV Inc., doing business as Ventura County Star, Denver Newspaper LLP, California Newspapers, Cape Publications Inc., doing business as Florida Today, Southcoast Newspapers Inc., doing business as North County Times, KFOG Radio San Francisco, LaFromboise Newspapers hlC doing business as The Chronicle and The Dallas Morning News. Under the Settlement Agreement, WaMu acknowledges that certain payments received by TBWA from Washington Mutual Bank with respect to WMB advertising do not represent transfers of the Debtors' property. WaMu also agrees not to pursue any action against TBWA seeking disgorgement of the funds, in exchange for TBWA's agreement to pay to the Vendors all outstanding amounts and to assist WaMu with obtaining claim withdrawals from the Vendors. According to the Debtors, they did not receive objections to Settlement Agreement. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WASHINGTON MUTUAL: IRS Withdraws $2.326 Billion Claim ----------------------------------------------------- Washington Mutual Inc., the Internal Revenue Service and the United States of America entered into a stipulation providing for the IRS' withdrawal, without prejudice, of Claim No. 8 for $2,326,611,411. The IRS' Claim No. 8 asserted amounts for WaMu's corporate income taxes for tax years 1994 to 1995, 1998 to 2007, and 2009. Judge Walrath previously denied the request of the United States, through the IRS, for a modification of the automatic stay under Section 362(d) of the Bankruptcy Code to allow setoff of a $55,028,000 payment to Washington Mutual, Inc., against the Claim. The $55 million payment was authorized by Senior Judge Loren A. Smith of the U.S. Court of Federal Claims on December 19, 2008, in the federal action captioned American Savings Bank, F.A., et al. v. United States, No. 98-872 C. The Debtors, the Official Committee of Unsecured Creditors and the Washington Mutual, Inc. Noteholders Group previously contended that the IRS Claim is based on taxes that "are yet to be assessed" and therefore, holds no merit. Pursuant to the Stipulation, the Debtors reserve all their rights with respect to the IRS Claim, including the right to object to the Claim and any of its future amendments or supplements. The Stipulation will not constitute in any way an acceptance or admission of the validity, in whole or in part, of the Claim. Similarly, the IRS and the United States reserve all their rights with respect to the IRS Claim, including the right to reduce, amend, or supplement the Claim, and the right to respond to any related objections. The Debtors, the IRS, and the United States contend that they continue to seek to resolve consensually outstanding issues regarding the Debtors' potential liability to the IRS. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WASHINGTON MUTUAL: Marathon Says Dismissal of Claims Premature -------------------------------------------------------------- To recall, Washington Mutual Inc. is asking the Bankruptcy Court to expunge three claims filed by bondholders, aggregating $5.5 billion: Claimant Claim. No. Claim Amount -------- ---------- ------------ Marathon Credit Opportunity 3710 $1.8 billion Master Fund, Ltd. Marathon Credit Opportunity 3711 $1.8 billion Master Fund, Ltd. Washington Mutual Bank 2480 $1.9 billion Noteholder Group The Bondholder Claims were essentially filed on account of: * corporate veil-piercing, alter ego and similar principles, * substantive consolidation, * improper claim to purported deposits, * undercapitalization of, or failure to support, Washington Mutual Bank, * misrepresentations and omissions, * conditional exchange for preferred securities, * tax refunds and losses, * mismanagement and breach of fiduciary duties, * goodwill litigation award, and * fraudulent transfer. Objecting to each of the allegations under the Claims, the Debtors assert that the Claims are defective because, among other things, they fail to (i) assert any factual allegations to support the claim that WaMu's directors and officers owed WMB and its creditors any fiduciary duties, and (ii) allege plausible allegations that treatment of WMB and WaMu as separate entities would perpetrate a fraud on the Claimants. Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington, Delaware, points out that the Claims asserted by both the WMB Noteholders and the Marathon Credit Claimants are common to all of WMB's creditors. Because claims that are shared by all of WMB's creditors belong to the Receivership, the Federal Deposit Insurance Corporation, as receiver for WMB, has "exclusive standing" to assert claims that generalized harm to WMB, as delegated to it under the Financial Institutions Reform Recovery and Enforcement Act. Marathon Claimants & Noteholder Group React The Marathon Credit Claimants, who filed Claim Nos. 3710 and 3711 on behalf of the holders of senior notes issued by Washington Mutual Bank, contend that it is "premature" for the Court to dismiss the Claims before any discovery has been completed and while it still remains unclear whether and to what extent the Federal Deposit Insurance Corporation, as Receiver of WMB, will pursue the Claims to final resolution. The Court simply does not have the information necessary to resolve issues on whether the Claims are direct or derivative, and whether the Marathon Claimants may have standing to pursue those Claims if they are derivative, Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP, in Wilmington, Delaware, asserts, on behalf of the Marathon Claimants. "At the very least, the [Marathon Claimants] are entitled to discovery . . . and thereafter an evidentiary hearing, regarding the disputed facts that the Debtors concede are at issue," Ms. Jones insists. "To the extent that the FDIC has asserted similar claims . . . will not make the [Marathon Claimants'] Claims go away, will not obviate the need to resolve the issues raised by the Claims, and will not obviate the possibility that the Claims will need to be paid," Ms. Jones emphasizes. Paulson & Co. Inc. filed a joinder to the Noteholders' response. Paulson's objection relates to Claim No. 2480, which was filed as a consolidated claim on behalf of the Company and other similar Noteholders. Also representing the Marathon Claimants, Nancy L. Manzer, at Wilmer Cutler Pickering Hale and Dorr LLP, in Washington, D.C., submitted to the Court a declaration of facts relating to, and in support of, Claim Nos. 3710 and 3711. On the other hand, the WMB Noteholders Group insists that the Debtors' allegations regarding the Group's failure to comply with Rule 12(b)(6) of the Federal Rules of Civil Procedure, with respect to Claim No. 2480 "is at its best, premature." Representing the WMB Noteholders Group, Andrew C. Kassner, Esq., at Drinker Biddle & Reath LLP, in Wilmington, Delaware, argues that Claim No. 2480 "is not a complaint" and needs only to comply with Rule 3001 of the Federal Rules of Bankruptcy Procedure and the Official Form No. 10 through which the Claim must be filed. Moreover, contrary to the Debtors' arguments, if a claim fails to adequately allege facts, it merely loses presumptive validity and the burden of proof remains on the claimant to prove its claims, he asserts. "The Debtors cannot seek dismiss the Claim without first providing the Noteholders Group with an opportunity to prove its Claim through the evidentiary process. This attempt of the Debtors 'to short circuit' this process should not be condoned," Mr. Kassner says. Mr. Kassner further explains that the measure of the Noteholders Claim's asserted damages is based on the difference between the price they paid for their WaMu Bank Notes and the value of those Securities -- and not on some compensable injury to WMB itself. "Thus, the Claim is plainly direct, not derivative." The Debtors' false and misleading statements, Mr. Kassner maintains, served to deceive holders of WMB securities concerning WaMu's financial condition, internal controls, underwriting standards, and appraisal process. "Had the WMB Noteholders known the truth about WaMu's 'weak financial condition' and about its 'dangerous business practices,' they would have sold, rather than continued to hold, their WaMu Bank securities and could have avoided portion of the damages they sustained," he tells the Court. JPMorgan Reserves Rights JPMorgan Chase Bank, National Association, wants to clarify that the Debtors' Objection to the Marathon Claims does not put at issue the question of its ownership or other rights or interests in the disputed assets involved in the Adversary Proceedings initiated by the Debtors and JPMorgan with respect to $4 billion in funds held by JPMorgan. JPMorgan reminds the Court that ownership of the other Disputed Assets within the Marathon Claims has not yet been substantively litigated as among JPMorgan, the Debtors and the FDIC. As a result, JPMorgan's rights or interests with respect to any of the Disputed Assets should not be prejudiced by Debtors' Objection, Adam G. Landis, Esq., at Landis Rath & Cobb LLP, in Wilmington, Delaware, asserts. Against this backdrop, JPMorgan reserves all of its rights in relation to the Claim Objection. JPMorgan further reserves its right to oppose any or all of Debtors' legal theories, including (i) the Debtors' interpretations of any portion of the Federal Reserve Act, or with respect to its requirements, (ii) the obligations of WaMu or WMB under the "source of strength" doctrine, and (iii) the scope of the Bankruptcy Court's subject matter jurisdiction. About Washington Mutual Based in Seattle, Washington, Washington Mutual Inc. -- http://www.wamu.com/-- is a holding company for Washington Mutual Bank as well as numerous non-bank subsidiaries. The Company operates in four segments: the Retail Banking Group, which operates a retail bank network of 2,257 stores in California, Florida, Texas, New York, Washington, Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada, Utah, Idaho and Connecticut; the Card Services Group, which operates a nationwide credit card lending business; the Commercial Group, which conducts a multi-family and commercial real estate lending business in selected markets, and the Home Loans Group, which engages in nationwide single-family residential real estate lending, servicing and capital markets activities. Washington Mutual Bank was taken over September 25 by U.S. government regulators. The next day, WaMu and its affiliate, WMI Investment Corp., filed separate petitions for Chapter 11 relief (Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns 100% of the equity in WMI Investment. Weil Gotshal & Manges represents the Debtors as counsel. When WaMu filed for protection from its creditors, it listed assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment listed assets of $500,000,000 to $1,000,000,000 with zero debts. Bankruptcy Creditors' Service Inc. publishes Washington Mutual Bankruptcy News. The newsletter tracks the Chapter 11 proceedings of Washington Mutual Inc. (http://bankrupt.com/newsstand/or 215/945-7000). WAVERLY GARDENS: Unsecured Creditors to Recover 2% of Claims ------------------------------------------------------------ The U.S. Bankruptcy Court for the Western District of Tennessee will consider at a hearing on March 30, 2010, at 11:00 a.m, the approval of a disclosure statement explaining the proposed Plan of Reorganization. The hearing will be held at Room 630, Memphis, Tennessee. The Plan proponents are Waverly Gardens of Memphis, LLC, and Kirby Oaks Integra, LLC (the Debtors,) and First Tennessee Bank National Association. The Debtors will begin soliciting votes on the Plan following approval of the adequacy of the information in the Disclosure Statement. According to the Disclosure Statement, the Plan provides the Reorganized Debtors sufficient time to sell assets in an orderly manner or to refinance with another lender to repay Debtors' loans to First Tennessee, as modified in the Plan. The Plan preserves the Debtors' ability to operate its independent living facilities while at the same time establishing a new, independent management team under the leadership of the chief restructuring officer to protect the interests of all interested parties. The Plan provides for 3 classes of secured claims; 2 classes of unsecured claims; and 1 class of equity security holders. General unsecured creditors holding allowed claims will receive payments equal to 2% of their Allowed Claim. The Plan also provides for the payment of administrative and priority claims. First Tennesssee will make a revolving loan to the Reorganized Debtor in an amount not to exceed $500,000 to satisfy the payment of administrative claims, other than administrative claims, and to provide post-confirmation working capital and approved capital expenditures. A full-text copy of the Plan is available for free at: http://bankrupt.com/misc/WaverlyGardens_JointPlan.pdf In a separate order, the Court ordered that their disclosure statement and plan of reorganization dated as of June 5, 2009, are deemed withdrawn. About Waverly Garden Memphis, Tennessee-based Waverly Gardens of Memphis, LLC and Kirby Oaks Integra, LLC -- http://www.waverlygardens.com/-- operate two senior living facilities consisting of a total of 248 units. Waverly Gardens consists of 196 rental units and is located at 6539 Knight Arnold Road, Memphis, Tennessee 38115. Kirby Oaks consists of 52 rental units and is located at 6551 Knight Arnold Road, Memphis, Tennessee 38115. The Debtors filed separate petitions for Chapter 11 relief on Oct. 2, 2008 (Bankr. W.D. Tenn. Lead Case No. 08-30218). Michael P. Coury, Esq., and Robert Campbell Hillyer, Esq., at Butler, Snow, O'Mara, Stevens & Cannada, represent the Debtors as counsel. When Waverly Gardens filed for protection from its creditors, it listed assets of between $10 million to $50 million, and debts of $1 million to $10 million. When Kirby Oaks filed for protection from its creditors, it listed between $1 million and $10 million each in assets and debts. WEBSTER BANK: Moody's Cuts Bank Financial Strength to C From C+ --------------------------------------------------------------- Moody's Investors Service downgraded the ratings of Webster Financial Corporation (senior debt to Baa1 from A3) and the ratings of its lead bank subsidiary, Webster Bank, N.A. (bank financial strength to C from C+; long- term deposits to A3 from A2; and short-term deposits to Prime-2 from Prime-1). This concludes the review for possible downgrade initiated on November 19, 2009. Following the downgrade, the rating outlook is stable. Webster Financial Corporation and its subsidiaries are referred to hereafter as 'Webster'. The downgrade resulted from Webster's protracted weakness in profitability and asset quality. Webster's core profitability has been weighed down by a lower net interest margin and higher expenses, combined with elevated credit costs. In Moody's view, higher credit costs associated with the company's commercial and industrial and real estate lending activities are likely to persist for several periods. Webster has made progress in addressing core pre-provision profitability issues through a series of strategic initiatives, including ceasing new originations in its more problematic portfolios. However, Moody's does not expect these improvements to be sufficient to generate more robust profitability. Following the downgrade, the rating outlook is stable as a result of Webster's capital and liquidity resources, which should enable it to manage through the economic cycle, even if conditions worsen. The rating agency noted the improvement in Webster's capital position, particularly its tangible common equity relative to risk-weighted assets. TCE has been strengthened by approximately $312 million of common equity obtained through investments from Warburg Pincus and the exchange of preferred securities in 2009. Liquidity at both the bank and holding company is robust. The balance sheet is primarily core funded. The holding company maintains liquid assets to meet several years of obligations without dividends from the bank. The rating agency also commented on the implications of the company's potential repayment of the remaining $300 million of preferred stock outstanding under the TARP Capital Purchase Program. Moody's said that repayment, if not accompanied by some common equity issuance, could reduce the ample liquidity and capital cushions of Webster, which currently temper the likelihood of downward rating action. Therefore, repayment of TARP without a capital issuance could lead to a change in Moody's stable outlook or its ratings. Moody's last rating action on Webster was on February 17, 2010 when its hybrid securities and shelves were downgraded as part of the implementation of Moody's updated guidelines for rating bank hybrid securities. Webster Financial Corporation is a bank holding company headquartered in Waterbury, Connecticut, with reported assets of $17.7 billion as of December 31, 2009. Downgrades: Issuer: Webster Bank N.A. -- Bank Financial Strength Rating, Downgraded to C from C+ -- Issuer Rating, Downgraded to A3 from A2 -- OSO Rating, Downgraded to P-2 from P-1 -- Deposit Rating, Downgraded to P-2 from P-1 -- OSO Senior Unsecured OSO Rating, Downgraded to A3 from A2 -- Subordinate Regular Bond/Debenture, Downgraded to Baa1 from A3 -- Senior Unsecured Deposit Rating, Downgraded to A3 from A2 Issuer: Webster Capital Trust IV -- Preferred Stock Preferred Stock, Downgraded to Baa3 from Baa2 -- Preferred Stock Shelf, Downgraded to (P)Baa3 from (P)Baa2 Issuer: Webster Capital Trust V -- Preferred Stock Shelf, Downgraded to (P)Baa3 from (P)Baa2 Issuer: Webster Capital Trust VI -- Preferred Stock Shelf, Downgraded to (P)Baa3 from (P)Baa2 Issuer: Webster Financial Corporation -- Issuer Rating, Downgraded to Baa1 from A3 -- Multiple Seniority Shelf, Downgraded to (P)Baa1, (P)Baa2, (P)Baa3, (P)Baa3, (P)Ba1 from (P)A3, (P)Baa1, (P)Baa2, (P)Baa2, (P)Baa3 -- Senior Unsecured Regular Bond/Debenture, Downgraded to Baa1 from A3 Outlook Actions: Issuer: Webster Bank N.A. -- Outlook, Changed To Stable From Rating Under Review Issuer: Webster Capital Trust IV -- Outlook, Changed To Stable From Rating Under Review Issuer: Webster Capital Trust V -- Outlook, Changed To Stable From Rating Under Review Issuer: Webster Capital Trust VI -- Outlook, Changed To Stable From Rating Under Review Issuer: Webster Financial Corporation -- Outlook, Changed To Stable From Rating Under Review YRC WORLDWIDE: Receives Non-Compliance Notice from Nasdaq --------------------------------------------------------- YRC Worldwide Inc. was notified by The Nasdaq Stock Market on March 3, 2010 that it is not in compliance with Nasdaq Marketplace Rule 5450(a)(1) because shares of its common stock closed at a per share bid price of less than $1.00 for 30 consecutive business days. In accordance with Nasdaq Marketplace Rule, the company has until August 30, 2010, to regain compliance. This notification has no effect on the listing of the company's common stock at this time. To regain compliance with the Nasdaq Marketplace Rules, the closing bid price of YRC Worldwide common stock must close at or above $1.00 per share for ten consecutive business days. About YRC Worldwide YRC Worldwide Inc., a Fortune 500 company headquartered in Overland Park, Kan., -- http://yrcw.com/-- is one of the largest transportation service providers in the world and the holding company for a portfolio of successful brands including YRC, YRC Reimer, YRC Glen Moore, YRC Logistics, New Penn, Holland and Reddaway. YRC Worldwide has the largest, most comprehensive network in North America with local, regional, national and international capabilities. Through its team of experienced service professionals, YRC Worldwide offers industry-leading expertise in heavyweight shipments and flexible supply chain solutions, ensuring customers can ship industrial, commercial and retail goods with confidence. At September 30, 2009, the Company had $3.281 billion in total assets against total current liabilities of $1.687 billion, long- term debt, less current portion of $892.0 million, deferred income taxes, net of $131.4 million, pension and post retirement of $384.9 million, and claims and other liabilities of $410.2 million, resulting in shareholders' deficit of $225.5 million. According to the Troubled Company Reporter on Feb. 26, 2010, Fitch Ratings has assigned a rating of 'C/RR6' to YRC Worldwide's new 6% senior unsecured convertible notes due 2014. The first tranche of new notes, totaling $49.8 million, was issued on Feb. 23, 2010. Proceeds from this tranche will be used to repay the $45 million in remaining outstanding principal on YRC Regional Transportation Inc.'s 8.5% senior secured notes (known as the USF notes). ZAYAT STABLE: Has Access to Fifth Third Cash Collateral Until May ----------------------------------------------------------------- The Hon. Donald H. Steckroth of the U.S. Bankruptcy Court in New York authorized Zayat Stable to use cash collateral of Fifth Third Bank in accordance until May 1, 2010. Fifth Third is owed $34 million on a secured loan. The use of cash is subject to a budget. Ron Mitchell at BloodHorse.com says the cash collateral will not be used to pay three premium payments totaling $214,553 for mortality insurance on the Company's inventory of horses. According to Bloomberg's Bill Rochelle, the agreement for the cash collateral use provides for a structure for selling two-year-old horses and others in claiming races. Proceeds would be held in an escrow account. The agreement, according to the Bloomberg report, also requires the stables to file a Chapter 11 plan by April 16. The bank is required to accept or make a counter-offer by March 12 to a plan term sheet submitted by the Debtor March 9.. If the parties cannot agree on continued use of cash beyond May 8, the judge will hold another hearing May 4. According to the Company, the use of cash collateral is necessary for the racing entity to maintain and preserve the assets and continue operations of its business including payroll and payroll taxes, payments to trainers and boarders of the company's horses, and insurance expenses. About Zayat Stables Hackensack, New Jersey-based Zayat Stables owns of 203 thoroughbred horses. The horses, which are collateral for the bank loan, are worth $37 million, according an appraisal mentioned in a court paper. Ahmed Zayat said in a court filing that he personally invested $40 million in the business. The Company filed for Chapter 11 bankruptcy protection on February 3, 2010 (Bankr. D. N.J. Case No. 10-13130). The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. ZAYAT STABLES: Cleared by Calif. Board for Deals with Bookers ------------------------------------------------------------- Ron Mitchell at BloodHorse.com reports that the California Horse Racing Board looked into the relationship between Ahmed Zayat owner of Zayat Stables and bookmakers Jeffrey and Michael Jelinsky, and determined there is nothing to indicate that Ahmed Zayat owner of Zayat Stable has violated terms of his license in the state. The Company had said that Messrs. Jelinsky owed Mr. Zayat more than $605,000. Mr. Zayat said the Jelinsky brothers owed him for loans he made to them in 2006 and 2007. Messrs. Jelinsky are serving prison sentences of 15 months and 21 months, respectively, after pleading guilty to illegal bookmaking in 2009. About Zayat Stables Hackensack, New Jersey-based Zayat Stables owns of 203 thoroughbred horses. The horses, which are collateral for the bank loan, are worth $37 million, according an appraisal mentioned in a court paper. Ahmed Zayat said in a court filing that he personally invested $40 million in the business. The Company filed for Chapter 11 bankruptcy protection on February 3, 2010 (Bankr. D. N.J. Case No. 10-13130). The Company listed $10,000,001 to $50,000,000 in assets and $10,000,001 to $50,000,000 in liabilities. * Senate Close to Deal on $50BB Fund to Wind Down Failed Firms -------------------------------------------------------------- Bloomberg News reports that the Senate is closing in on a deal to create a $50 billion trust fund that will be used to wind down failing institutions. Citing a Senate aide and two people familiar with the talks, Bloomberg reported that Senator Mark Warner, a Virginia Democrat, and Senator Bob Corker, a Tennessee Republican, are near agreement to create a mechanism that will dissolve companies in an orderly way without using taxpayer funds. The fund will be funded from fees on large U.S. financial firms that likely will include Goldman Sachs Group Inc. and Citigroup Inc., Bloomberg said. * FDIC Plans to Sell $1.37-Bil. of Guaranteed Debt This Week ------------------------------------------------------------ Jody Shenn at Bloomberg News, citing unidentified people, reports that the Federal Deposit Insurance Corp. is planning to sell $1.37 billion of notes it is guaranteeing. According to the report, the debt may be sold as soon as this week. The zero coupon notes have a weighted average projected life of 1.62 years to 3.62 years, the person familiar with the offering said. The FDIC has been planning to sell bonds backed by its interest in Corus Bank assets with zero coupons, Bloomberg said. * FDIC Seeks Upfront Bank Levy to Cover Costs of Failure -------------------------------------------------------- The Financial Times reported that Sheila Bair, the chairman of the U.S. Federal Deposit Insurance Corp., wants an upfront levy on big financial institutions to cover the costs of possible failures. Ms. Bair told FT she still advocates a pre-funded "resolution authority" for such cases. According to the newspaper, the FDIC chair envisages an aggregate levy of about $10 billion a year, in addition to the $90 billion tax already announced by President Barack Obama. A total of 45 banks with combined assets of $65.0 billion failed during the fourth quarter of 2009, at an estimated cost of $10.2 billion to the FDIC. For all of 2009, 140 FDIC-insured institutions with assets of $169.7 billion failed, at an estimated cost of $37.4 billion. This was the largest number of failures since 1990 when 168 institutions with combined assets of $16.9 billion failed. In its quarterly banking profile, the Federal Deposit Insurance Corp. said that the number of institutions on its "Problem List" rose to 702 at the end of 2009, from 552 at the end of the third quarter and 252 at the end of 2008. The Deposit Insurance Fund decreased by $12.6 billion during the fourth quarter to a negative $20.9 billion (unaudited) primarily because of $17.8 billion in additional provisions for bank failures. * Banks Face Greater Demand to Repurchase Defective Loans --------------------------------------------------------- Lenders such as Bank of America Corp., JPMorgan Chase & Co., Wells Fargo & Co. and Citigroup Inc. will brave stiff headwinds this year as they face demands to buy back defectively underwritten mortgages, according to ABI. * Upcoming Meetings, Conferences and Seminars --------------------------------------------- Mar. 4, 2010 AMERICAN BANKRUPTCY INSTITUTE Nuts and Bolts - Florida Hyatt Regency Tampa, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 4-6, 2010 AMERICAN BANKRUPTCY INSTITUTE SUCL/Alexander L. Paskay Seminar on Bankruptcy Law and Practice Hyatt Regency Tampa, Tampa, Fla. 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Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 29, 2010 (tentative) AMERICAN BANKRUPTCY INSTITUTE International Insolvency Symposium The Savoy, London, England Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. __, 2010 AMERICAN BANKRUPTCY INSTITUTE Delaware Views from the Bench and Bankruptcy Bar Hotel du Pont, Wilmington, Del. Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. 11, 2010 AMERICAN BANKRUPTCY INSTITUTE Detroit Consumer Bankruptcy Conference Hyatt Regency Dearborn, Dearborn, Mich. Contact: 1-703-739-0800; http://www.abiworld.org/ Dec. 9-11, 2010 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference Camelback Inn, a JW Marriott Resort & Spa, Scottsdale, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ Dec. 2-4, 2010 AMERICAN BANKRUPTCY INSTITUTE 22nd Annual Winter Leadership Conference Camelback Inn, Scottsdale, Arizona Contact: 1-703-739-0800; http://www.abiworld.org/ Jan. 20-21, 2011 AMERICAN BANKRUPTCY INSTITUTE Rocky Mountain Bankruptcy Conference Westin Tabor Center, Denver, Colo. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 31-Apr. 3, 2011 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ June 9-12, 2011 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort and Spa, Traverse City, Mich. Contact: http://www.abiworld.org/ July 21-24, 2011 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Hyatt Regency Newport, Newport, R.I. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 4-6, 2011 (tentative) AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hotel Hershey, Hershey, Pa. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 14, 2011 AMERICAN BANKRUPTCY INSTITUTE NCBJ/ABI Educational Program Tampa Convention Center, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 25-27, 2011 TURNAROUND MANAGEMENT ASSOCIATION Hilton San Diego Bayfront, San Diego, CA Contact: http://www.turnaround.org/ Dec. 1-3, 2011 AMERICAN BANKRUPTCY INSTITUTE 23rd Annual Winter Leadership Conference La Quinta Resort & Spa, La Quinta, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ Apr. 19-22, 2012 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ July 14-17, 2012 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz-Carlton Amelia Island, Amelia Island, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 2-4, 2012 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ Nov. 29 - Dec. 2, 2012 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference JW Marriott Starr Pass Resort & Spa, Tucson, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ The Meetings, Conferences and Seminars column appears in the Troubled Company Reporter each Wednesday. Submissions via e-mail to conferences@bankrupt.com are encouraged. Last Updated: February 21, 2010 ********* 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. Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Howard C. Tolentino, 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 2010. 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 ***